When will Ohio, Kentucky forgive Pandemic Unemployment Assistance overpayments?

Congress authorized waivers in December
Posted at 5:00 AM, Jan 21, 2021
and last updated 2021-01-21 18:40:50-05

CINCINNATI — The symphony of complaints about Ohio’s handling of pandemic-related unemployment claims has struck a chord with Bridgetown musician James Martino.

Nicknamed “Mick” by friends because of his love for “The Stones,” Martino kept things rolling by playing and teaching music after retiring from the U.S. Postal Service two years ago.

“This is just what I wanted to do, and then COVID hit,” Martino said.

When bars and restaurants closed, the gigs dried up for Martino, who traded his piano keyboard for a computer keyboard to request jobless benefits.

In May, Martino received notice from the Ohio Department of Job and Family Services stating he was eligible for Pandemic Unemployment Assistance (PUA) in the amount of $18,720.

In mid-December, Martino received a “Notice of Corrected Determination” stating that the maximum PUA benefit amount available during Martino’s benefit year was $8,694. The notice said his $10,000 overpayment would be deducted from future benefits. Martino said he has not received any benefits since.

“We can’t just send a letter to people and say, ‘We screwed up so you make it right.’ No, you screwed up. You make it right,” he said.

As the WCPO I-Team has previously reported, more than 162,000 Ohioans are in the same boat as Martino – after Ohio overpaid nearly 28% of the roughly 600,000 PUA recipients it served through the end of September. State officials said the overpayments were caused by a variety of factors, including huge demand from people who didn’t qualify for traditional unemployment and federal guidelines that encouraged states to let applicants self-certify their income and eligibility for the program.

Until last month, states were required by the CARES Act to collect all overpayments after gathering tax documents and other materials to verify their original eligibility decisions. That changed with the Continued Assistance for Unemployed Workers Act of 2020, signed into law Dec. 27.

“We are planning to take advantage of that,” Ohio Job and Family Services director Kimberly Henderson said. “All of the states are coming together to work with the Department of Labor to fully grasp what it means.”

Lawmakers authorized states to waive repayment of PUA benefits if overpayments happened through no fault of the recipient or “repayment would be contrary to equity and good conscience.” That means a failure to forgive overpayments would cause harm to the debtor.

Henderson said states are close to developing a consensus on how to implement federal guidelines so there is “consistent application” of the rules for determining which claims are eligible for repayment waivers. In the meantime, she said, Ohio PUA claimants should appeal any repayments they think state officials have incorrectly demanded.

“There is an appeal process,” Henderson said. “They should not fail to avail themselves of all their due-process rights. Continue moving through that path. That will be very important.”

Ohio and Indiana have an advantage over some states because they already have laws that allow for repayment waivers due to agency mistakes involving traditional unemployment, said Andrew Stettner, a senior fellow for The Century Foundation, a progressive think tank based in New York.

“They should be able to move relatively quickly,” Stettner said. “Obviously, they have to set up the procedures.”

Kentucky, on the other hand, will require a change in state law before it can issue repayment waivers, Amy Cubbage, general counsel in the office of Kentucky’s governor, told reporters in a media briefing Jan. 8.

“We are hoping the General Assembly gives us the flexibility to waive those payments,” Cubbage said. “I know they have announced a willingness to do that."

A bill to authorize repayment waivers was introduced in the Kentucky House Jan. 9. But no vote has been scheduled for the measure, which has four co-sponsors. No corresponding bill has been introduced in the Kentucky Senate. The Kentucky General Assembly’s current session runs through March 30.

States that already allow payment waivers still must comply with new federal guidelines, and that could slow down the processing of payment waivers, Stettner said.

“I think people need to be prepared to be waiting three months, six months,” Stettner said. “Even if Ohio knows they made the same mistake for a thousand people, they can’t just waive those thousand people with the push of a button. They have to treat each case individually. That may even mean that each unemployed worker has to make a request for the waiver of the overpayment.”

Martino said, for him, that sounds miserable.

“When you call, you’re on hold for literally hours, or the phone is busy,” he said. “And if someone picks up, they don’t know what they’re doing, or they’ll hang up on you.”

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