Good news for Pennsylvania jobless, with a troubling shadow

Checked in this morning with John Dodds, head of the Philadelphia Unemployment Project, about the state of the Pennsylvania unemployment compensation phone system. Actual good news!

"The phones have been cleaned up," Dodds wrote back. "We are no longer getting complaints and our contacts at the state are reporting that the problem is now in the past.  We are not sure how they did it, but are glad that they did." There had been complaints about being on hold for hours, days and being unable to get questions answered. People resorted to going to their legislators' office and getting help through constituent services. Not efficient, but perhaps effective in getting the problem resolved.

What prompted my call to Dodds was a press release from the state's Department of Labor and Industry last week. On June 13, Labor Secretary Julia Hearthway received the 2013 Unemployment Integrity Award from the National Federation for Unemployment Compensation and Workers Compensation at its convention in Arlington, Va.

I really wasn't willing to write much about the award without finding out what was happening on the phone front, which was also her responsibility. So many people lost benefits or struggled to gain them or simply gave up because they couldn't get past endless busy signals or outrageously long waits on hold to talk to a representative. Many state workers in that department were laid off, which certainly did help. At least they knew how to work the system so they could collect their unemployment benefits. Many of Pennsylvania's jobless weren't as capable. The state's response was to direct unemployed callers to the web site, which was confusing to many. It is good news to hear that the situation has improved. 

Now back to the award, given to Hearthway for her work in shoring up the state's unemployment trust fund.

Like many states, Pennsylvania's unemployment fund had been deeply in debt to the federal government when payments made to the jobless during the recession cleaned out fund's coffers. The repayment plan mandated by the federal government isn't easy on states and on the employers who have to pay more to make up difference. The longer the loan lingered, the tougher the terms.

Hearthway essentially refinanced that debt through a private bond sale, borrowing at a 1.29 percent interest rate through a private bond sale. Employers will save $150 million over the life of the loan, the press release said.

Even Hearthway's critics agreed at the time that refinancing the debt to the feds was a good move, and it is gratifying that her colleagues in her field saw it that way as well at their National Unemployment Insurance Issues Conference last week. 

In the press release, Hearthway credits Gov. Corbett, saying, "It's because of the governor's leadership in the passage of Act 60 in 2012 that we restructured the state's UC system, restoring the fund to ensure that benefits will be available for years to come to those who need them."

Most of the provisions of Act 60 were roundly criticized by advocates for the unemployed. They said that the unemployment system was shoring up its insurance fund primarily "by tightening eligibility and reducing benefits to those that are eligible," lawyers from Community Legal Services of Philadelphia  wrote last year in a report on Act 60.  The changes made it more difficult for people to qualify for unemployment benefits -- and by squeezing people out, the state saved an estimated $300 million, the report said.