UI help in July, warning on virus, benefit expansion, budget cut alarm

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FRAKFORT, Ky. (WTVQ) – Kentucky has hired accounting giant Ernst and Young to provide immediate help processing unemployment claism with a goal of clearing the final 56,000 cases still pending from March, April and May by the end of July.

It was one a wide range of updates Tuesday from Gov. Andy Beshear, including an expansion of benefits for the needy, a jobs and economic development update, and some cautious words about the cronavirus and the state compared to some others where surges are shutting down business again.

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“Today were going to talk about not just the present, which we spend a lot of time talking about, but were going to start talking about the future. Last week when we were able to talk about AgriTech, an exciting area that we are going to lead in in the future, I think it was something people need to see, that we are not going to be battling this virus forever,” Beshear said in opening what has now become a weekly briefing.

“There is a tomorrow, we are planning for the tomorrow and we have an opportunity in creating that tomorrow to change our economy, to make Kentucky a leader, to focus on areas that are going to lead for the next 30 years and give us a brighter future with better jobs.”

He then went into the latest update on processing unemployment claims, announcing the hiring of Ernst & Young, to help overcome years of funding and personnel cuts to the Office of Unemployment Insurance and begin immediately processing outstanding claims that resulted from the COVID-19 global pandemic.

“After years of cuts, we were left with a starved Office of Unemployment Insurance and an antiquated system that was not up to the task that COVID-19 dealt,” Beshear said. “Our Kentucky families cannot wait any longer and this is the most affordable, quickest and efficient way to resolve remaining claims. We expect to have 200 E&Y staffers that will begin processing claims on Monday, with another 100 coming soon. Our goal is to process all unresolved claims between March 6 and May 31 in July.

About 56,000 initial claims from March, April and May have not been processed.

Starved system

  • The system created in 2000 was designed to tell Kentuckians filing a claim no.
  • The states unemployment office budget went from $41 million in 2010 to $25 million in 2018.
  • The former administration in 2017 cut 22 of 51 local unemployment offices and 95 employees.
  • These changes either forced Kentuckians to drive longer distances to the few remaining regional offices or call the Frankfort office, which had 12 employees.

These financial, geographic and staffing challenges have made it impossible for the office and system to react to the demands of 900,000 to 1 million claims filed because of the COVID-19 economic shutdown, but the Governor said he was determined to find a path forward.

Hiring Ernest and Young is one of the latest steps to overcome the problems. He also said the state has issued a request for proposals to secure a new unemployment computer system to replace the state’s 20-year-old machines.

As for why Erest and Young, the governor listed several reasons:

  • Globally respected firm, with a large presence in the commonwealth.
  • Recent experience processing unemployment claims in Colorado.
  • While the commonwealth has processed 90% of claims, paying out more than $2.7 billion since March, the firm can provide 300 employees to resolve outstanding claims quickly. In comparison, the state would have to pull some existing employees from working claims to help train not nearly as many more adjudicators, which could take up to four to six months.
  • The ready-to-go experts save more than $15 million in annual costs that would be associated with payroll, benefits, equipment and training.
  • Additional assistance covered under federal CARES Act funding.

“We must fix this right, right now. I am taking decisive action because we must get this matter resolved for our Kentucky families,” Beshear said.

The state’s deal with Ernst & Young begins July 1 and runs for four weeks. Its workers will help process claims both in person and over the phone. Officials estimate the contract staffers will be able to process at least 50,000 claims. Ernst & Young also will review the state unemployment insurances processes, data and technology architecture.

Some 100 workers will start this week and eventually as many as 300 from the company or new state trainees will be n the job, not only to take care of the backlog but to also start rebuilding the state’s system, Beshear said.

To learn more about in-person services announced last week, click here.

The governor announced 282 new coronavirus cases Tuesday, pushing the state’s total to 15,624.

“While we are not seeing the type of very concerning spike like in so many other states, we are seeing ourselves continuing to be in that plateau area between about 150 and 300 cases,” the governor said. “It’s something we’ve got to watch carefully.”

Unfortunately, Gov. Beshear reported five new deaths Tuesday, raising the total to 565 Kentuckians lost to the virus.

The deaths reported Tuesday include a 70-year-old man from Campbell County; a 71-year-old man from Hardin County; and two women, ages 77 and 86, and a 92-year-old man from Jefferson County.

Of the new cases, 49 were in Jefferson, 46 in Fayette and 12 in Laurel.

The state has 408 COVID-19 patients in the hospital and 75 in ICU. The numbers mean only about 60 percent of the state’s hospital beds are full, and not all those are coronavirus. The same for ICU, which is about 73 percent occupied. Only about 27 percent of the state’s ventilator capacity is being used, he said.

As of Tuesday, there have been at least 404,781 coronavirus tests performed in Kentucky. At least 3,990 Kentuckians have recovered from the virus.

For additional information, including up-to-date lists of positive cases and deaths, as well as breakdowns of coronavirus infections by county, race and ethnicity, click here.

Dr. Steven Stack, commissioner for the Department for Public Health, spoke Tuesday about where Kentucky and the rest of the U.S. stand after months of efforts to limit the spread of the coronavirus.

“We have tried to be gradual and phased, so we didn’t get into trouble quickly and we could make adjustments if we needed to,” Dr. Stack said.

“Early, decisive actions by Gov. Beshear and the compassion and sacrifices of all Kentuckians have led to declining case numbers and deaths, positioning the commonwealth to safely restart the economy here. As of Monday, all businesses in Kentucky are able to operate in some capacity,” he added.

“Ladies and gentleman, we have undeniably blunted the curve in the state of Kentucky. Over the last 120 days or so, since we started this on March 6, we have undeniably kept that curve flat. This is a success in the middle of a very, very difficult situation.”

In contrast, Dr. Stack spoke about surging cases in the South and Southwest that followed an easing of restrictions. Coronavirus cases in Arizona, South Carolina and Florida have spiked sharply in recent days, leading officials in those states to pull back on reopening economic activities amid renewed fears of hospital capacity shortages.

Dr. Stack emphasized Team Kentucky’s mantra for a safe reopening: hands, face, space and testing. Frequent hand washing and sanitization, along with wearing cloth masks and maintaining six feet of distance from others are the frontline measures everyone can take to slow COVID-19. In addition, Kentuckians can fight the deadly pandemic by taking advantage of testing opportunities and cooperating with contact tracers if they call.

Beshear also asked Kentuckians to remain vigilant over the Fourth of July weekend.

“Because we will not have another one of these briefings unless something comes up before the Fourth of July, we need you to be safe. Safe not just for you, but your actions create safety for the people around you and that you may interact with 10 days after the Fourth of July,” the governor said. “Remember, so many people can be asymptomatic. If you put yourself in a dangerous place, you get the virus, you could feel fine. It can be five, seven, 10 days after and you can spread it to someone who wont be fine. So, hands, face, space over the Fourth of July. Overall we did pretty good job over Memorial Day weekend. Lets make sure we continue to protect one another.”

On benefits for the needy, Eric Friedlander, secretary of the Kentucky Cabinet for Health and Family Services, provided information Tuesday about an extension of benefits aimed at keeping children healthy and properly fed.

The deadline to apply for Pandemic-Electronic Benefits Transfer (P-EBT) has been extended until the end of August. P-EBT provides equivalent funding for meals that students would have been provided in school this spring without the closures due to COVID-19. If people have questions about how to access these benefits, go to chfs.ky.gov and search for PEBT, email PEBT.info@ky.gov or call 855-306-8959.

“We’ve seen a recent upsurge in folks who are trying to get the P-EBT benefits, and there still remains some questions from folks who are trying to get through,” said Friedlander. “So with this big upsurge, we’ve signed up over 516,000 individuals. We know there are another 100,000 out there. So we want to give everybody the opportunity to sign up.”

Kentuckians who are uninsured can apply for short-term coverage through Medicaid Presumptive Eligibility.

Families can apply online at chfs.ky.gov or benefind.ky.gov, by contacting an application assister at healthbenefitexchange.ky.gov or by calling 855-459-6328. Initial coverage ends two months after the application month, unless the person applies for regular Medicaid or Presumptive Eligibility is extended due to a continued COVID-19 state of emergency.

The state is extending Presumptive Eligibility benefits for three months for anyone who already applied and whose coverage was previously set to end June 30.

Beshear also warned the state could face dire cuts without federal financial help like it did a decade ago.

“I’ve told you before that this virus is decimating every state budget across the country and that if we do not have additional stimulus from the federal government, another CARES Act, that we would be facing devastating cuts,” Beshear said. “I believe I told you before that I think that they would be the largest cuts that we’ve seen in our history.”

According to the most recent estimates, the 2021 budget is likely to face a shortfall of $1.1 billion. Beshear said that will require cuts of 16% to 29% across state departments.

“This would be like letting Kentucky go bankrupt, which we cannot allow to happen. So let’s continue to push our federal delegation, we’ve had good communication with them, and say that we cant let this happen in Kentucky because this hurts education, it hurts social services, its going to hurt our ability to provide UI, unemployment claims. It’s going to hurt every single thing we do and further starve the systems that people are relying on,” he said, noting the state workers and every state resident would shoulder the cuts if they have to occur.

On economic development, Beshear said since December when he took office, the state has announced 135 new projects, expected to secure nearly 4,700 new full-time jobs for Kentuckians and represent about $1.35 billion in new investments.

Among the new projects is a $9 million hemp processing facility being created by Shyne Labs in Simpson County. Shyne Labs relocated from California and already employs about 20 Kentuckians. The new facility is expected to bring 60 more full-time jobs in the commonwealth as the company expands its CBD oil-extraction business.

We know there is going to be a continuing market, though it looks like it is smaller than people thought it was three or four years ago, for CBD products. And we know how many hemp farmers are out there right now that need a hemp processor, need someone who can buy that crop and we want to make sure that we support Shyne Labs,” Beshear said.

Another major project is a $2 million plan by Richmond-based Truck Equipment & Body Co. of Kentucky Inc. to build out a facility in Powell County. The new facility is expected to create 43 full-time jobs.