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Tale of two benefits: Maryland’s unemployment insurance failed, while direct relief payments worked. Here’s what one can learn from the other | COMMENTARY

Chrissy Holt of Anne Arundel County speaks at a protest of unemployed Maryland workers in front of the Maryland Department of Labor last year. They want help from the Hogan administration for the problems they are experiencing as they attempt to collect unemployment benefits during the COVID 19 crisis. (Barbara Haddock Taylor/Baltimore Sun)
Chrissy Holt of Anne Arundel County speaks at a protest of unemployed Maryland workers in front of the Maryland Department of Labor last year. They want help from the Hogan administration for the problems they are experiencing as they attempt to collect unemployment benefits during the COVID 19 crisis. (Barbara Haddock Taylor/Baltimore Sun) (Barbara Haddock Taylor / Baltimore Sun)

One week ago, Gov. Larry Hogan signed into law a $1 billion COVID-19 relief bill that guaranteed low-income Maryland taxpayers a direct payment to help them survive these difficult times. Four days later, an estimated 98% of those eligible for payments of $300 to individuals and $500 to families had received their funds, in a majority of cases directly deposited into their bank accounts. The $175 million disbursement didn’t happen by accident. Comptroller Peter Franchot is justifiably proud of the planning and preparation that went into the task, as state employees prepared for the pandemic relief payments before the law authorizing them even existed. And, as his staff is quick to note, all this took place during the beginning of income tax season, the busiest time of year for Maryland’s chief tax collector.

Now, contrast that to those unfortunate residents of this state who have struggled to receive unemployment benefits from the Maryland Department of Labor. The delays have become legend from those who can’t get through the state’s call center to laid off workers stuck in denials and appeals. Thousands have been trapped in this bureaucratic hell, created when a system that clearly wasn’t designed to function smoothly and efficiently confronted historic increases in claims, as whole industries were temporarily shuttered by the pandemic beginning nearly one year ago. Lawmakers in Annapolis report that they continue to receive desperate calls from people struggling to collect what is rightfully due to them.

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Here’s what they hear: “Help. I’ve applied online for unemployment insurance benefits. I’ve been told they’ve been approved but no money has shown up and now I can’t get through by phone to anyone who can help me.” That was almost exactly the complaint received just weeks ago by a Baltimore legislator. The woman who reached out has been waiting for benefits since July 13. That is seven months. Now, multiply her miserable experience by 4,000, which is the number of calls lawmakers have reportedly received in recent weeks. And that’s believed to be only one-tenth of the number of Marylanders still stuck in benefits limbo.

Granted, it’s undoubtedly easier to send out checks to people who received an earned income tax credit in 2019, as the comptroller’s office did last week, than to arrange for unemployment benefits. Exactly when someone lost their job, why they lost a job, how much they earned, and whether they have outside income today all can play a role. Sometimes there are disputes between employer and employee over those specifics. And the money involved is substantially larger, too. Over the past year, the Labor Department has processed 1.4 million new unemployment insurance claims and paid out more than $9 billion in benefits. Agency officials claim the vast majority are handled without a hitch.

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But even allowing for the greater challenges of responding to unemployment claims, the state appears to have done a miserable job with the task. One of the problems is that the Department of Labor just wasn’t prepared for an emergency like COVID-19, when layoffs spiked in a manner that no one had seen before. Clearly, officials were caught flat-footed. They did not have a plan to quickly expand the system for reviewing applications. That was a mistake but one that can be rectified now: Among the proposals in a sweeping package of reforms pending before the General Assembly is a requirement that the Department of Labor have a disaster plan for the future.

Legislators have come up with some other welcome ideas, too. They include providing unemployment benefits by direct deposit, requiring caller ID at the call center (so applicants know a returned call regarding benefits is legitimate), and permanently increasing the amount beneficiaries can receive in outside income, from $50 per week to $150, before it lowers their benefits check. Further, lawmakers would create a better system for tracking laid off workers, as well as metrics to determine how well applicants are being served (or not served).

Gov. Larry Hogan would be smart to endorse any or all of these ideas and stop treating criticism of how badly the unemployment benefits system has performed as a political attack by Democrats against a Republican governor. Here’s a better response: A lot of states have struggled with unemployment claims this past year; Maryland just needs to stop being one of them. Perhaps he could hire some of the comptroller’s staff.

The Baltimore Sun editorial board — made up of Opinion Editor Tricia Bishop, Deputy Editor Andrea K. McDaniels and writer Peter Jensen — offers opinions and analysis on news and issues relevant to readers. It is separate from the newsroom.

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