On the Legislative Audit Council's report released today, we'd say three things:
One, the report again highlights the gross incompetence and lack of accountability that have infested the Employment Security Commission. As we've made clear for more than a year and a half now, these shortcomings have real world consequences. Over roughly the last decade the ESC has, contrary to federal guidance, drained its Unemployment Trust Fund to the tune of $600,000 per day * creating an almost billion dollar deficit for which the state's businesses and taxpayers are ultimately responsible. Indeed, if this Fund had been managed in the private sector, this level of ineptitude could well merit criminal charges.
Two, it's worth noting that if the ESC had made a few targeted changes to the way they do business, this collapse could have been in part averted. For example, the ESC stopped filtering out fraudulent unemployment claims back in 2008 * costing taxpayers more than $7 million. Moreover, the ESC inexplicably paid out over $171 million to people who were fired for good reasons * including actually being sent to jail, and abuse * over just the last three years. This stands in stark contrast to many of our neighboring states' refusal to send checks to those who were fired for appropriate reasons.
Finally, the plain fact is that state government's first line of defense against unemployment has fallen down on the job, and we'd again encourage the General Assembly to take this report and pass legislation to institute accountability into the system. Specifically, we'd thank Senators Ryberg, Setzler and Lourie, as well as Speaker Harrell and Representative Bingham, for their leadership on this front dating back to last year. The LAC's report adds some urgency to the question, and in that regard we look forward to getting a final bill that includes a Cabinet-level Department of Workforce on our desk this session.