Hector Barajas & Mike Vallante
It’s no secret California’s Employment Development Department is a disaster.
During the coronavirus pandemic, the struggling state agency has lost billions to fraud and has been under constant fire from state lawmakers who say the agency isn’t doing enough to help those hit hardest by the economic downturn.
Millions of calls from Californians looking for unemployment benefits are going unanswered.
Things have gotten so bad that America’s second largest banking institution – Bank of America, which has had an exclusive state contract with EDD since 2010 – announced it no longer wants anything to do with servicing EDD accounts. The EDD’s situation is so untenable that the bank is seeking to exit the partnership as soon as possible.
Things have gotten so bad for EDD and its continually jammed phone lines that the Legislature is stepping in and has permitted state lawmakers to hire staffers dedicated solely to respond to the flood of requests from their constituents struggling to receive unemployment benefits.
“The good news is legislative offices are going to get extra help so we can serve more people who have still not been paid what they are owed,” said State Assemblymember Jim Patterson (R-Fresno), a harsh critic of the EDD. “Many of these people have already gone back to work and are trying to recoup funds that EDD never paid them.”
BofA expressed to lawmakers that it lost “’hundreds of millions of dollars on the contract last year as it scrambled to respond to California’s rampant unemployment fraud,” according to CalMatters. Experts say that the fraud could total to upward of $31 billion.
Unfortunately—but most likely—the fraud cost will fall on taxpayers yet again.
Hector Barajas is a communications expert with decades of political, legislative and media experience. Nationally recognized for his work on political campaigns, ethnic media outreach, and public affairs from Capitol Hill to Sacramento.
Mike Vallante has extensive experience in communications and public relations. Mike served as the Regional Administrator for U.S. Small Business Administration’s Region IX. He previously served as Chief Staff to the Co-Chairman of the Republican National Committee in Washington, DC. Before that, he was Chief Operating Officer of the California Republican Party from 2003 to 2007.