January 27, 2015

Audit reveals unemployment benefit overpayments, blocked calls

Learfield file photo

Learfield file photo

An audit shows the Department of Workforce Development blocked almost 1.7 million calls from people trying to claim unemployment benefits in the year that ended June 30.

The Legislative Audit Bureau report shows the vast majority of blocked calls were made between December 2013 and January 2014, when the phone system was overloaded. Senator Rob Cowles of Green Bay says it was a long-running problem.

“One year period 60 percent of the calls were blocked and another year it was almost 80 percent of the calls were blocked. Now, since February 2014, and up until this past June 14th, it’s down to 10 percent.”

The co-chair of the Joint Legislative Audit Committee says changes to the agency’s computer system helped.

The audit also found the DWD overpaid nearly $168 million in unemployment benefits during the three year period that ended in June.

“I’m very interested in tracking that overpayment and getting that money back. it’s not easy to get it back. So, it’s something that we have to continue to monitor.”

About 85 percent of the overpayments were the result of accidental errors. About 9.5  percent were likely fraud.



Wisconsin overpaid nearly $168 million in unemployment benefits, audit shows

Learfield file photo

Learfield file photo

The Department of Workforce Development (DWD) has identified 681,400 overpayments over the past three years, totaling $167.9 million. That’s the result of individuals intentionally (9.5 percent) and unintentionally (84.7 percent) providing inaccurate information.

The Legislative Audit Bureau (LAB) released the findings of this audit today (Tuesday). The report shows the total amount of overpayments recouped by DWD declined steadily in the previous three years, from $51.7 million to $42.3 million. It typically takes years to fully recoup overpayments that DWD identifies. The $42.3 million recouped in FY 2013-14 included overpayments that DWD had identified over the prior 26 years.

Individuals file initial claims through an automated telephone system, online, or by contacting one of DWD’s two call centers. LAB found that almost 1.7 million calls to the call centers, or 60.2 percent of the total, were blocked in fiscal year 2013-14 because call center staff were busy and the telephone queues were full. From December 2013 through January 2014, when call volumes were high, LAB found that more than 80 percent of calls to the telephone line for filing initial claims were blocked. However, from February 2014 through June 2014, less than 10 percent of such calls were blocked

DWD attributed the high call volume to the December 2013 expiration of federal emergency unemployment benefits and indicated other individuals called to file initial claims after their holiday-related jobs ended or after their work hours were reduced because of harsh winter weather. LAB reports that DWD is taking steps to reduce the likelihood that large numbers of calls will be blocked in December 2014 and January 2015, when many individuals may attempt to file claims. These steps include the implementation of a new computer system in November 2014, hiring of additional limited-term employees, and tasking additional DWD staff to help answer calls.

LAB recommends DWD report to the Joint Legislative Audit Committee in March 2015 on its experience over the next several months.

Report highlights concerns about Wisconsin tax burden

Lt. Gov. Rebecca Kleefisch and DOR Sec. Rick Chandler at a tax round table event.

Lt. Gov. Rebecca Kleefisch and DOR Sec. Rick Chandler at a tax round table event.

A new report outlines a wide range of concerns about Wisconsin’s tax system, although it offers no specific suggestions on how to address those issues.

The report from Lieutenant Governor Rebecca Kleefisch and State Revenue Secretary Rick Chandler is the result of 23 roundtable hearings held around the state over the past year, along with comments submitted online. It says residents and members of the business community expressed concerns during those meetings about the high property and income taxes, along with a desire for a simpler tax code.

However, it concludes without offering any specific paths to address those issues, only saying there’s a need to continue the tax conversation and to “propose budgets that will lower property taxes in Wisconsin, allow more discretionary income for our citizens, and create a tax climate that will not only encourage existing businesses to move to our state, but will also provide the setting necessary for new start-ups to grow and succeed in Wisconsin.”

In a statement, Kleefisch said that she and Chandler “went as observers, not advocates, looking for the best ideas and honest input of Wisconsin’s taxpayers.” While Chandler said “We received a lot of very thoughtful input about tax reform from citizens all across Wisconsin. People clearly appreciate the tax relief they’ve seen in the last four years and want to see continued tax reduction and tax reform.”

Chandler and Kleefisch embarked on the statewide tour at the request of Governor Scott Walker.

Wisconsin Rep. Tom Petri proposes federal gas tax increase

petriblumenauerWhen it comes to pushing policy, perhaps nothing works like a cardboard cutout of President Ronald Reagan. Wisconsin Republican, congressman Tom Petri and Oregon Democrat Earl Blumenauer had the Gipper on hand as they proposed an increase in the federal gasoline tax.

“Ronald Reagan supported raising the gas tax back in 1982 because he believed in funding American infrastructure in a responsible way. I think he was right, and it’s the best course of action we can take at this time,” said Petri, who was first elected in 1979 – the year before Reagan won the 1980 presidential election. Petri chose not to seek reelection in November.

Craig Thompson with Wisconsin’s Transportation Development Association said the federal gas tax has not been raised in twenty years. “It’s been the same since 1993. It hasn’t been adjusted since then. Most of us, if we’re driving cars that get better gas mileage than we did twenty years ago, are paying less than we were 20 years ago in the federal gas tax,” Thompson said.

Federal gas tax revenues make up about twenty-five percent of Wisconsin’s transportation spending, so even a modest increase would help. But – President Reagan notwithstanding – that’s unlikely. “It’s a little hard to picture this congress and president coming together to solve something like this right now, and if they don’t it’s going to be left up to the states to come up with answers on their own,” Thompson said.

Wisconsin is facing a projected $680 million shortfall to fund transportation needs, and the state DOT recently proposed a funding plan that includes an increase in state fuel taxes, something that could be a tough sell in the legislature.

Tax cuts to be a priority for Governor Scott Walker

There’s a tax cut in your future – although the specifics are still a work in progress. Governor Scott Walker is making it pretty clear that tax cuts will be a high priority as he begins his second term.

“I think our overall goal is to lower both property and income taxes, if we keep chipping away over the next four years” Walker said in Green Bay on Thursday. “It’s not something you can do all at once, but I think we can continue to lower the burden on the hardworking taxpayers of this state.”

That combination of income and property tax reductions is a likely scenario – although Senate Majority Leader Scott Fitzgerald says it’s the latter which seems to irk voters the most. “Just coming off the campaign trail, it’s still something that people bring up all the time,” Fitzgerald said.

Fitzgerald said the size of the state budget deficit, and the potential impact any tax reductions would have on it, will be a major consideration as Republican majorities in the Senate and Assembly consider what type of tax cut package they can support.