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Audit shows backlog of unread emails at unemployment office

Kentucky capitol
Posted at 12:36 PM, Feb 09, 2021

FRANKFORT, Ky. (AP) — A massive backlog of unread emails piled up in computers at Kentucky’s unemployment insurance office as it struggled to process claims in the pandemic-battered economy, according to an audit released Tuesday.

More than 400,000 emails archived by the beleaguered office were unread as of last Nov. 9, state Auditor Mike Harmon said in releasing the report. Those emails from claimants included problems needing to be resolved as well as general questions from unemployed Kentuckians, he said.

“It breaks my heart to think of those Kentuckians included in the 400,000 unopened emails who so desperately wanted their voices heard and yet were ignored,” the Republican auditor said.

The review revealed a “systemic failure of leadership on all levels” in the state’s response to record-setting waves of claims for jobless assistance caused by the coronavirus, said Harmon, who is being mentioned as a possible GOP candidate for governor in 2023.

In response, Gov. Andy Beshear called it a “challenging balance” for state workers responding to unprecedented numbers of jobless claims and multiple emails from people desperate for assistance.

“Our hope is that we can get through all of these emails in a way that does not take our people who are on the front lines, getting these people the benefits they need, off of that really important work,” the Democratic governor said at his coronavirus-related briefing Tuesday.

Tens of thousands of Kentuckians found themselves in limbo for months as they waited for their jobless claims to be processed. Beshear’s administration eventually hired an outside company to help work through the claims backlog.

The issue put the governor on the defensive even as he continued to point to budget and staffing cuts that hobbled the unemployment insurance system well before he took office. In his budget plan to lawmakers, Beshear proposed more funding to update the antiquated system.

More than 1.6 million unemployment insurance claims have been filed in Kentucky in less than a year, with the state paying out more than $5.6 billion in benefits since March, the state Labor Cabinet said Tuesday.

Any lawmakers or past administration that allowed the state’s unemployment insurance staffing to be cut deserves some of the blame, Beshear said. But the governor acknowledged that “there are things that I wish that we would have done better.”

“People have needed our help,” he said. “We’ve been able to help the vast majority of them. And anybody out there who still needs help that we haven’t gotten to, that’s our failure.”

Multiple problems in the unemployment insurance office were found during a comprehensive audit of Kentucky government, the auditor said. Those problems should be “deeply concerning” to taxpayers and those who filed for benefits, Harmon said.

Many of the audit’s findings revolved around one common issue: “the decision to remove controls that provided better oversight on verification and payment of UI (unemployment insurance) benefits,” Harmon said.

Due to the volume of claims and new pandemic-related federal programs, the state office made decisions that “sacrificed program integrity” in trying to speed jobless payments, Harmon said.

One of the changes, referred to as “Auto-Pay,” allowed unemployment benefits to be paid automatically without requiring claimants to report weekly wage information needed to determine whether they were eligible for benefits, the audit said.

Due to a lack of controls over payments in the weeks while Auto-Pay was in effect, auditors could not precisely estimate total overpayments or underpayments, the audit said.

The federal government rolled out pandemic-related programs last year without offering full guidance at the start for states to implement, said Amy Cubbage, the governor’s general counsel. She called it a “learning curve” for states, and said that by last fall Kentucky was deemed to be in compliance with those guidelines.

Harmon’s report was the latest audit to reveal problems in the unemployment insurance office. An audit released in late 2020 showed the state didn’t know how much money was still owed to Kentuckians who filed for jobless benefits and pointed to internal control issues in the office.