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Tennessee's Unemployment Insurance Program
2013-2014
Joint Fiscal Review Committee June 10, 2014
Chair – Senator Bill Ketron
Vice Chair – Representative Mark White
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Single Audit In Perspective
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Perspective
Most Recent Audit Period July 2012 – June 2013
Prior Audit Period July 2011 – June 2012
Current Department Administration April 2013 - Present
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Headlines Jobless Benefits Paid To:
84 Felons Behind Bars (.0002% of 390,000 claims)
16 (19) State Workers (.00004% of 390,000 claims)
3 Dead People (.000007% of 390,000 claims)
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Overpayments FY 07-08 thru FY 12-13
$81,500,000 in overpayments (based on USDOL definition of overpayment)
Or
$181,000,000 in overpayments (includes $94.5 million COT estimated potential )
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Antiquated System
43 Years Old Mainframe System COBOL
(Common Business Oriented Language) 120 Programs
(Leaky Dam) Multiple Undocumented Additions and
Work Arounds 6
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Leaky Dam
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Fraud Prevention
SAS (Fraud Detection Software)
Weekly Cross Matching
(Individuals Incarcerated)
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Citizens Properly Served
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Currently Approximately 29,500 Drawing TN Unemployment
72.3% of the Approved Claims are Paid within
Federal Guideline of 21 Days or Less (2013 average)
21 Days or Less - May 2014 65%, June 2014 68.6%
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Overriding Priorities
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Customer Service Experience
Effective/Efficient Program Delivery
Acquire/Implement New Modern System
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SCUBI
After Extensive Due Diligence Tennessee Removed Itself From the
SCUBI Consortium July 29, 2013
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Going It Alone Sought “off-the-shelf” Solution
(no “from scratch” creation)
Competitive Bid - RFP Contract Awarded Contract Signed
18-24 Months Implementation $38 Million Cost Avoidance
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IT Failures 2013-14 • Nevada – four years planning - $38 million • Pennsylvania - $107 + $60 million overruns
– 42 months past due • Florida - $63 million + $6 million overrun –
10 months overdue • California - $188 million • Massachusetts - $46 million + $6 million
overruns, 2 year overdue 13
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So Where is Tennessee? Incremental Improvements to Old
System
-While-
Implementing New Modern System
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What You Hear From Constituents
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“The message said to call but I can’t get anyone on the phone!”
“I was approved but was locked out when I tried to
certify!”
“Why is it taking so long to get my decision (payments)?”
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Call Reduction
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January 2014 – 803,786 (5 to 1 original callers)
February 2014 – 402,184 March 2014 – 299,948 April 2014 – 298,955 May 2014 – 249,829
(2 to 1 Original Callers)
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0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
Jan Feb Mar Apr May Jun Jul
Call Attempts to Claim Center
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21 Day Adjudication
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Converted Paper and Manual Centric Process to Digital Process
Effect on Backlog To Date;
Approximately 45% decline since January 2014
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Certification – PIN Resets
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80% of Issues Revolve Around These
Very Recent Modifications Realizing Immediate Positive Results
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New Customer Service System
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Interactive
30 Day Trial Through March 2014
Fully Implemented April 2014
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Contract Signed for Modernization
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Contract signed May 1, 2014 for a New UI system to Replace the Mainframe System
Full Implementation Within 18-24 Months
$38 Million Cost Avoidance
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Implementation Task Force
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UI/Employment Security Workforce Development
IT Fiscal Services
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Automated Employer Tax Payment
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Automated system for employers to pay quarterly taxes
Since July 17th, 2013 implementation:
44,705 payments totaling $48,821,845.33
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Trust Fund Health
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Tennessee in Top Eleven States with Trust Fund Balances in Excess of $700,000,000 as of March 2014
May 2014 Balance
$874,542,999
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Solvency of States UI Funds
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U.S. Department of Labor – Trust Fund Solvency Report - May 2014
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Questions
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