Audit criticizes NM unemployment system computer

July 19, 2013 • State News

SANTA FE, N.M. (AP) — A newly implemented computer system for unemployment taxes and claims is so complex that it’s difficult to use for New Mexicans seeking jobless benefits and the computer’s cost has more than doubled to $48 million, legislative auditors said Friday.

The audit report released Friday by the Legislative Finance Committee faulted state oversight of the Workforce Solution Department’s computer system, which was financed by federal money and went into operation in January.

The audit criticisms were echoed by members of the committee and the Center on Law and Poverty, which said it’s received numerous complaints about the computer system from unemployed people.

The center’s staff told lawmakers about a man whose jobless benefits were cut off because of problems with the computer and his electricity service eventually was shut off at this home after he couldn’t pay his bills.

“These are the real world [auth] effects, the real implications for New Mexican workers when they do not receive a benefit that they are absolutely entitled to at a time when they are most vulnerable,” said Loni Hodge, a staff attorney with the Albuquerque-based group.

Democratic Sen. George Munoz, a Gallup developer and contractor, said his business has been plagued with problems trying to electronically file reports required of employers. One of his office workers spent 2 ½ hours on the phone with the department trying to resolve a problem, he said.

“There should, I guess, be a lemon law for this program. Either that or we should just go straight back to paper because the system doesn’t work,” said Munoz.

Workforce Solutions Secretary Celina Bussey described the computer modernization project as a success but said the agency was continuing to try to make it more user-friendly.

“I do believe wholeheartedly that six months into this system we have made great strides since January. No accusation that we are perfect. We still have challenges,” Bussey said.

She acknowledged, as the audit pointed out, that it takes more time for someone to submit an application for unemployment benefits using the computer. However, she said that’s because more information is gathered now, such as an 18-month work history rather than just data about someone’s most recent job. The extra information, she said, is to help improve the processing of an unemployment claim. There used to be a lengthy exchange of paper documents after a claim was first filed, she said.

The cost of the computer has grown, Bussey said, partly because the federal government required states to automate more of their unemployment compensation systems.

The computer was initially developed during former Gov. Bill Richardson’s administration and was first planned for handling the taxes paid by employers. It was expanded to cover the processing of unemployment claims by workers, managing overpayments and checking for fraud.

The state awarded a $17 million contract to a vendor in 2010, but that has been amended five times and the contract is now valued at nearly $39 million. Two other companies have been hired for project management and for programming support. The combined contracts for the three companies are nearly $48 million although not all of the money has been spent yet.

The rising costs, the audit said, caused the department to reduce the warranty for the computer system from one year to four months. Auditors said there should have been independent outside oversight of the project.

“Unemployed individuals with limited computer knowledge may be overwhelmed with the data input process of filing benefit claims,” the audit said.

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