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As thousands continue waiting for unemployment, Maine’s labor commissioner is grilled over the system’s problems

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Maine Dept. of Labor Commissioner Laura Fortman appears before the Legislature's Labor and Housing Committee on Wednesday, May 6, 2020. Maine Dept. of Labor Commissioner Laura Fortman appears before the Legislature's Labor and Housing Committee on Wednesday, May 6, 2020. (edge photo by Mike Fern)

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AUGUSTA – Maine lawmakers returned to the state capitol Wednesday to hold a hearing with Department of Labor Commissioner Laura Fortman to address the ongoing problems with the state’s unemployment system and the Mills administration’s response to it. Fortman, who appeared along with Deputy Commissioner Kim Smith, spent the entirety of the hearing answering lawmakers’ pointed questions ranging from front-end website issues and denials of unemployment to the inability of Mainers being able to reach a live person.

Fortman began the Legislature’s Labor and Housing Committee hearing by describing the breadth and depth of the problem – a total of 110,000 people have filed for unemployment insurance benefits in the past seven weeks after Gov. Janet Mills placed the state in lockdown under a state of emergency in March. Fortman noted somberly that the figure was more than the total filings in the past three full years. So far, she said the bureau has paid more than $240 million in benefits since the pandemic began.

“The scale and speed of the response to COVID-19 has no comparison,” she told lawmakers during her opening statement. “We have expedited thousands of state unemployment claims while concurrently launching new federal programs created by the CARES act.”

So far, nearly 73,000 claims have been processed and benefits are being paid. About 37,000 are still waiting, including 19 who have been on hold since the beginning of the pandemic. Fortman said many who originally applied for unemployment were not eligible due to monetary eligibility and/or work search requirements.

“This situation has been frustrating for everyone,” she added.

Technology, meet pandemic

While members of the labor committee applauded the efforts of Maine Labor Department employees to try to handle the problems, many from both political parties took issue with the unemployment system – and the website interface itself – while others took on how the department and the Mills administration have responded to the state’s pandemic crisis.

Sen. Stacey Guerin, R-Glenburn, challenged Fortman out of the gate on whether the state could have handled information technology problems sooner with another vendor such as Amazon or Google, technology companies more accustomed to front-end website solutions.

“Today we are addressing the response,” she began. “I have heard from hundreds of Mainers who see the department’s and Mills administration’s responses completely inadequate and an utter failure.  Thousands of Mainers have gone seven weeks without a paycheck. To me, this is completely unacceptable.”

Citing Rhode Island, which is part of the ReEmployUSA platform consortium along the Maine, Connecticut and Mississippi, Guerin said state officials there saw many of the same systemic issues and contracted with Amazon to build a front-end interface – the online retail giant was able to accomplish it in 10 days. Similarly, Guerin referenced Google creating a new unemployment system for New York, which saw its system crash in mid-March, in about a week. Florida, Georgia and Texas have since contracted Google to tweak their respective user-facing systems using the architecture built for New York.

As the Labor Department’s delays continued and the backlog in cases grew, Guerin asked Fortman if the administration or her department reached out to any technology companies for help. While Fortman pushed back in comparing Rhode Island’s unemployment system to Maine’s and said the state’s actual processing system is sound despite the backlog, she said she had not reached out to anyone.

Google’s account manager for Maine confirmed that during a conference call Tuesday attended by The Edge, and she said Google was unable to reach any state or department officials to offer help based on their success with other states. During that call, a Google engineer said the company could scale a portal front-end system to throttle and route call traffic, manage the application process and archive related forms for the process including the Pandemic Unemployment Assistance (PUA) program, and do it in about a week for around $1.5 million. Integrating with the state’s back-end systems, however, would take a bit longer.

‘User experience’

Rep. Michael Sylvester, D-Portland, the Maine House co-chair of the committee, piled on about the website’s design, following up Guerin’s comments in saying residents of his district have described the website as confusing, unintuitive and arcane. He said users have experienced everything from not being able to find the actual ReEmployME portal (an icon to the left of the page) to even getting kicked out mid-process.

“The system itself doesn’t have built-in help as you’re going through it,” he said. “So, it’s not maybe as intuitive as it could be.”

Fortman admitted there are things that should be improved from a user experience perspective, including communication with users regarding changes, and putting more information on the DOL website.

Sen. Shenna Bellows, D-Manchester, who co-chairs the panel, recited a long list of headlines dating back to 2018 that showcased a litany of on-going issues with the ReEmployME site, which began as a project in Mississippi’s Department of Employment Security and has since grown into the multi-state, cloud-based unemployment insurance system named ReEmployUSA. She inferred that state officials knew intimately of the system’s problems the past two years and, as the pandemic was unfolding, begged the question of why the department didn’t seek out ways to reinforce it.

“To Senator Guerin’s point, is it possible that there could be improvements made to the system that would help Mainers? Is it possible that we could seek additional technical support regardless of which company we use?” she asked. “Is it possible that there could be systemic improvements to the system?”

In her reply Fortman said there is always room for improvement, but she bucked Bellow’s sentiment and said she thought the system’s stability was good enough. She added later in the hearing that the state considers ReEmployUSA more as a partner than a vendor, although having changes made to the system is not easy.

“It was my judgement that we were better, that Maine people would be better served to get benefits out to them than to try to recreate a system during a crisis,” she said.

Caught unprepared

In defending her department’s overall response, Fortman said the bureau’s capacity to handle calls since mid-March increased when the bureau added 100 workers to its tier-1 call center. Yet problems have continued, and she blamed understaffing and underfunding as part of the current crisis. Smith said the department is planning to add another 138 positions that have been newly created.

“We’ll be posting those [positions] within the next few days,” Smith said. “We have been working with LL Bean to help us hire and train those staff.”

The move to partner with LL Bean was born out of the fact that DOL simply does not have the staff to onboard and train the department’s new employees. Yet in responding to a follow-up question by Rep. Scott Cuddy, D-Winterport, Fortman admitted the department was caught largely unprepared despite the pandemic unfolding across the country in January and February – Maine didn’t have its first case until March 13 and the emergency declaration was made less than a week later.

She added that systems had to be redesigned to allow for working remotely - although she didn’t reveal when those plans were developed and put in place – and she told Cuddy that staff was not cross-trained.

“I’m open to suggestions,” she said.

Rising frustration all around

Maine has also been behind in implementing the PUA program, a federally funded program under the CARES act that helps business owners and those who are self-employed.

Mills said during the Maine Center for Disease Control and Prevention (Maine CDC) daily press briefing Wednesday that the administration has engaged the private sector to help solve the ongoing issues with the unemployment insurance program. While she wouldn’t respond to what senators were discussing during the hearing, she did have sympathy for what Mainers were going through.

“We’ve hired about 100 private contractors to help respond to the more than 100,000 unemployment claims under the four or five different, new unemployment paradigms,” she said. “We’re working on the newest, the federal Pandemic Unemployment Assistance program, as fast as we can.”

In addressing the PUA that Mills referenced, Fortman said the state received official instructions for the program April 25 and the program kicked off May 1. She also said the department will be automatically converting past denials and enrolling some in the Pandemic Extended Unemployment Compensation (PEUC) for those who have exhausted existing state benefits, and any approved claims under both programs will be retroactive to the appropriate dates. Fortman said Maine was in the “middle of the pack” in rolling out the new programs.

Still, there was a sense among lawmakers that many problems exist with the whole unemployment system, from user responses that people are entitled to zero benefits to some responses that completely confuse filers or give them anxiety. Then, there’s the issue of actually getting through to someone, including legislators’ own frustrations in trying to get answers from the Department of Labor.

Robin Knight in Brunswick was one such filer who filed for unemployment insurance after her employer furloughed her. Her company, a manufacturer in Maine, gave their employees two weeks of paid time off upon the emergency order in mid-March. However, she eventually got the call at the end of March where she was told that production was being cut indefinitely at their two locations until COVID-19 was more under control.

When she filed for unemployment, she initially made some errors and was soon kicked off the system. Upon trying to reenter the website, she was locked out after forgetting her password and couldn’t get it resolved until well over a week later.

“I did get help briefly from someone at one of the Career Centers to reset my password, but that was all,” she said Wednesday.

However, when she entered her PTO information the system said she was eligible but was given the status of “Issue on file.” To this day, she still has not received any payments from Maine.

“I was on the phone just about every day, calling the Unemployment toll-free number, attempting to contact a person to speak with them and have the issue cleared so I could get paid,” she said. “One day – between my cell and the home phone – I actually dialed that number over 75 times. Each time it rang once, twice, then hung up or went to busy signal.”

Knight said she finally got a call Wednesday morning but missed it. After trying that number back, all she got was voicemail. It would take her three more tries to finally get through and speak with someone and now she’s waiting until at least next week to see if her issue is truly resolved. Regardless, the whole experience has kept her up at night as her husband still works but their income has been severely reduced.

“I worked for a DHHS agency in [New Hampshire] in a clerical support role for nearly nine years prior to our move to Maine seven years ago,” she said. “As a former civil servant, I have been appalled at the lack of help to the needy [that] I have encountered here in Maine during this crisis.”

Fraud is another issue that is front and center for many lawmakers, coinciding with the frustrating inability to reach the department to combat it. Guerin said her company received a fraudulent unemployment claim and she couldn’t get through to the bureau to let them know about it.

“I had somebody apply for unemployment through my business who we never heard of,” she said. “I called the fraud line and was on hold for over an hour and then it just disconnected.”

Fortman said fraud is one of DOL’s concerns and while the state has integrity measures to help root out such cases, she agreed having a line available for employers is necessary.

Where’s the money?

Fortman explained during the hearing that the unemployment insurance program is funded through the state unemployment insurance (SUI) tax that businesses pay as a percentage of their payroll. The rate schedules, which are tables the state uses to determine exactly what percentage, vary depending on the health of the state’s unemployment fund and the experience rating of the employer.

If employers experience low turnover of employees that results in few or no claims over a given time, they pay less tax. Conversely, employers that have high turnover rates or many unemployment insurance claims, they will pay a higher percentage according to the table in the schedule.

Emergency legislation signed by Mills in March suspended that experience rating process during the pandemic.

The state has been using Schedule A – the lowest of the tax tables – for four years now since unemployment hasn’t been very high in Maine and the fund has been relatively stable. During the hearing, however, Fortman said that could change causing employers to pay higher SUI taxes in the future in order to resupply the fund.

When the state began paying claims seven weeks ago, Fortman said Maine had about $500 million, or 15.8 months’ worth of benefits, in state’s unemployment trust fund. When factoring in the sudden surge of claims, that naturally changes the equation.

Today, the state’s unemployment trust fund stands at around $378 million, according to Smith.

Some of those funds may come back through federal reimbursements. The first week, which is normally a waiting period for new unemployment claims, was waived so that tab is being picked up the federal government as well as the additional $600 assistance and the PUA and PEUC programs, according to Fortman. But at some point, state resources may diminish more quickly.

“Unlike some other states, we are not in imminent danger of needing to borrow,” Fortman said. “But we are also incredibly cognizant of the fact that we need to replenish any of the federal dollars that we are able to put back into the trust fund.”

To further complicate matters, there’s the aspect of less workers earning a check in Maine – especially among summer workers tied to tourism – and some employees are making more through unemployment insurance than from their actual jobs. That situation was the result of the federal CARES act that gave unemployment recipients the additional $600 per week.

Fortman said benefits should end for anyone who is able to be called back to work. She couldn’t provide answers how seasonal workers would be affected, since their employment cycle hasn’t yet occurred and likely may not even happen as some businesses won’t open until July and others have since closed permanently.

‘We need to make this better’

Given the frustrations expressed by just about all committee members during the hearing, it was obvious the hearing was the first time in nearly two months that lawmakers had a direct opportunity to challenge the response of the Mills administration given the severity of the problems at DOL’s unemployment bureau.

Much of it has to do with archaic federal rules and the 90-year-old design of a system that was never meant to be used during a pandemic or in the way it is being used now to cover sole proprietors and independent contractors.

“The design of unemployment was designed in the ’30s. It left out an enormous amount of the new economy,” said Sylvester, referring to those kinds of workers. “As we look going forward, is there any discussion or movement that you’ve heard in terms of thinking into the future to include the new economy?”

In her reply, Fortman said there are obvious cracks in the current system and the federal programs helped fill them. Still, it’s a system that was never designed to do what state and federal authorities need it to do with so much human interaction still needed to move cases through the system.

And as more of those claims are filed from people who are now eligible, along with claims from those businesses that close permanently because they cannot make it to stage 2 or 3 in Mills’ four-phase plan to reopen, and even seasonal businesses that may end up losing too much of the summer choosing not close but rather suspend their seasons, the system may again be overwhelmed.

Another source of claims may come from businesses that participated in the Payroll Protection Program – the Trump administration’s federal program offered to businesses through the Small Business Administration. Department of Economic and Community Development Commissioner Heather Johnson acknowledged that concern at a previous Maine CDC press conference in that there may be a surge in new or reopened unemployment insurance claims in June from employees of businesses that applied for the program and fall under stage 3. Stage 3 businesses that received the funds early and are unable to reopen until July under the plan may run out of those funds in late May or early June before being able to reopen on July 1. That may force them to layoff or re-layoff their employees.

At the end of the hearing, many lawmakers continued to applaud the efforts of the Department of Labor’s employees but Bellows and Guerin both summed up the frustration of those Mainers who are still waiting for benefits.

Guerin offered an apology to Mainers “for the lack of response in their time of need.” She said many of the stories revolving around the situation brought tears to her eyes.

Bellows expressed a similar sentiment, noting that legislators need to be more involved collaboratively in the process with Mills’ administration, which so far has been calling all the shots.

“There are people in need and we all have to work together to make this work. It’s unacceptable that people have gone on so long without the support that they need,” she said. “We need to make this better.”

Last modified on Tuesday, 12 May 2020 15:50

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