California EDD recipients may see reduction in benefits
SAN JOSE, Calif. (KTVU) - The constant drip of unwelcome news from California’s Employment Development Department is drowning out slight success fighting fraud.
On Thursday, the department sent a letter that said nearly 110,000 jobless Californians could see their benefits reduced in the coming days.
"Unemployment assistance is the most complex of the state benefit programs," said former EDD director Michael Bernick.
The department said a change in requirements of federal relief funds means upwards of 217,000 recipients must be moved from a state system into two federal payment systems. More than half of those beneficiaries will see their payments reduced.
Bernick said the problem is the department’s outdated computer system. He explained it must be reprogramed anytime there’s a change in benefit amount, duration, or eligibility. That ends up hurting the people it’s designed to help.
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"There’s no quick fix now. It’s nothing EDD can do. This is a rebuild of a system that’s going to take a couple of years. It’s not going to take a couple of weeks," said Bernick.
Frustration with the EDD is running high. Newly elected state Sen. Dave Cortese, D-San Jose, wants the department and its banking partner, Bank of America, to undergo regular auditing due to the slew of missteps. And it’s not just Californians that suffer from these types of problems.
"I live in Connecticut. Stuff like this happens every now and again here too," said University of New Haven economics professor John Rosen.
Rosen said the problem with state-run social service agencies is a lack of competition to compel better performance for the end-user — the public.
He believes it’s similar to how competition makes the best delivery services thrive, while the lesser performers fall by the wayside.
"There’s no incentive to treat your customers with dignity, care and concern. In other words, FedEx would be out of business if they had this level of problems," said Rosen.
There’s no competition for unemployment relief coming to the aid of Californians. Now it’s a waiting game to see how deep the reduction in benefits will be, as the ill effects of a COVID-infected economy continue making the masses sick in every way possible.