Colorado unable to trace cash paid into unemployment fund

DENVER (AP) – A Colorado unemployment insurance audit failed to validate the accounting for hundreds of millions of dollars inside and outside the Colorado Department of Labor and Employment.

“The state of Colorado did not have an adequate method of establishing the estimated amount of claims and liabilities within the unemployment insurance fund,” the audit said.

The audit means the state has not been able to track $ 510 million received from the Department’s employer rewards and coronavirus aid assistance, nor has it tracked $ 872 million in unemployment claims until the end of June reported KUSA-TV on Tuesday.

“Yes, our books on it were a little lousy to the reviewers, and we’ve gone back and spoken, and we’re working to keep that from happening,” said division chief of staff Daniel Chase.

The audit also found that the department provided financial information that was inaccurate after the audit deadline.

“We made retroactive adjustments to our books of accounts, but that was late, and again they were using a method that the auditors just didn’t quite approve of,” Chase said.

The department received 548,000 unemployment claims from July 2019 to June 2020, equivalent to about five years of work, compared to the average 109,000 claims over the past three years. Of the more recent claims, 337,000 – or 60% – were filed between March 15 and April 30, 2020.

Chase attributed the discrepancies in part to changes in finance management and efforts to reorganize and reorganize the department. The department lost its controller, its deputy controller, and several subordinates. A new system was also introduced which was delayed, leading to more fraudulent claims.

The state has borrowed $ 930 million to support its unemployment insurance and continues to borrow loans to meet unemployment claims.

The fund is expected to be replenished through higher premium rates for employers, and Chase estimates his balance will be positive in 2026.

“I don’t think employers will ever feel good about giving us more money,” said Chase. “I think that with all of the measures we were taking at this point, we started in August before this exam and have been moving forward since then, giving us confidence in what we will do in the future. ”