Tennessee's $311 million bill

Tennessee's $311 million bill

December 11th, 2011 in Opinion Free Press

It is hardly a secret that Tennessee, like most other states, has struggled over the past few years to make ends meet. So recent news of costly problems in Tennessee's jobless benefits program is alarming.

The problems are twofold:

* First, Tennessee has among the highest rates in the country for improper payments of jobless benefits.

* Second, the overwhelming majority of Tennesseans receiving unemployment benefits do not have to provide proof that they are actively seeking jobs.

The rate of improper payments of unemployment benefits has been pegged at about 14.5 percent in our state.

What does that mean in dollar terms?

Well, according to a report from the U.S. Department of Labor, it means that over a three-year period, Tennessee overpaid almost $311 million in benefits -- money that comes from both businesses and taxpayers.

We doubt that anyone believes Tennessee has $311 million to be throwing away on improper benefits of any sort in this weak economy.

What caused the overpayments? There are several causes, but one of the more significant reasons is the continued payment of benefits to people after they get work. Nearly a quarter of workers kept claiming -- and getting -- benefits even after they had landed jobs. Some of that is the result of ignorance on the part of the workers, and some is the result of outright fraud.

In addition, some -- though certainly not all -- of the unemployed are gaming the system.

Gov. Bill Haslam and Lt. Gov. Ron Ramsey alike have heard from numerous employers that have offered jobs to jobless workers, only to be turned down.

"[T]hey'll say, 'Well, my benefits don't run out for six more weeks, eight more weeks, and I don't want to be hired until then,'" Ramsey said.

He was careful not to minimize the real pain of unemployment.

"I know it is tough times," he said. "I'm not downplaying that at all. But I also know that in some cases there are jobs available if people would be willing to do it."

The other big problem is the lack of verification that unemployed people receiving jobless benefits are making a good-faith effort to find work.

About 120,000 people in the state are currently getting unemployment benefits, but only 12,000 to 13,000 of those -- about 10 percent -- are required to submit weekly forms specifically naming two employers whom they have contacted. The others need only "certify" that they are seeking jobs. They don't have to give specific information. By no means does that prove that they are not seeking work, but it obviously creates a path to undeserved benefits for those who may not be actively looking for jobs.

The Chattanooga area and Tennessee as a whole have a strong heritage of helping those in need. But when either private or public dollars are at stake, there should be reasonable verification that those receiving benefits are legitimately entitled to them.