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October 14, 2013
Editorial: Agency failed in its duty to jobless Californians

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(Oct. 14 -- By the Editorial Board)

A good rule of thumb for any major project is to hope for the best, but prepare for the worst. Those in charge of California's unemployment insurance program failed to do so.

As a result, the Employment Development Department has another embarrassing black eye, but more importantly, tens of thousands of Californians had to wait far too long for their benefits.

As The Sacramento Bee's David Siders laid out in undeniable detail Monday, EDD officials knew that a major computer upgrade was vulnerable to glitches and they badly underestimated how many people would be affected by any hiccups.

Before the launch over Labor Day weekend, officials had been working for months to overhaul the 30-year-old payment processing system - part of a $188 million project that is supposed to eventually let claimants submit required certifications for jobless benefits online or by telephone. Internal records, obtained through a public records request, show that officials had ample warning of potential problems. After the launch, officials celebrated success prematurely and initially downplayed how serious the flaws were.

It took a month to finally clear the backlog, but by then the damage had been done. Nearly 150,000 Californians - about 19 percent of all those in the state receiving jobless benefits - had their unemployment checks delayed. Many suffered hardships and some even ran out of cash. Eventually, the Brown administration ordered EDD to pay delayed claims immediately and determine eligibility later. The numbers were so big that they skewed the U.S. Labor Department's unemployment reports.

The department maintains that tests indicated that any problems would be manageable. If they had suggested otherwise, a spokeswoman says, the department would have delayed the conversion.

Top officials have apologized to the public, but that isn't enough. This lapse is even more disappointing given the history of costly failures in state government technology projects and the department's own past computer troubles.

In 2009 and 2010, EDD struggled to keep up with an explosion of claims during the Great Recession, unable to send checks on time to the long-term unemployed. The department also suffered cost overruns and delays in past computer modernization projects. Hearing from frustrated constituents, fed-up legislators grilled top officials and criticized what they described as technological and administrative mismanagement.

It looks like time for another hearing to try to get to the bottom of why the department still can't get its act together. At the least, it would force top EDD officials to hear again how their failings hurt people. Sometimes, public shame is not such a bad thing.

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