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Oregon unemployment problems under microscope at legislative hearing

State lawmakers got their first chance in months to publicly question the head of the embattled Oregon Employment Department on Tuesday. Acting director David Gerstenfeld’s testimony kicked off several days of hearings on the state’s unemployment crisis. Those hearings culminate Thursday morning, when lawmakers plan to hear directly from out-of-work Oregonians.

Gerstenfeld sought to tell a story of both dire need and systemic progress — progress that he recognized meant little to people still waiting for benefits.

“We know that it’s a crisis. It’s horrible. We know that it’s not fair to those people,” he said.

But he also pointed to the $4 billion in benefits the state has paid out since the pandemic hit.

“That is more than seven and a half years’ worth of benefits being paid out since March,” he said. If that were payroll, he noted, OED would now be the largest employer in the state.

Unemployment benefits would be the largest industry.

The four-hour video hearing from the Senate Interim Committee on Labor and Business was largely an informational meeting.

Gerstenfeld updated lawmakers on the numbers. Since March 15, roughly 538,000 people have filed for regular unemployment benefits and about 345,000 have received them. About 21,000 people are still waiting, he said. The rest were found ineligible or did not continue filing weekly claims.

The backlog is greater among people who have filed for Pandemic Unemployment Assistance benefits. More than 46,000 people have been paid PUA benefits, according to Gerstenfeld, leaving roughly 32,000 people still waiting for their claims to be resolved. Other PUA applicants ended up receiving regular benefits.

Sen. Tim Knopp, R-Bend, asked for timing updates on federal and state changes affecting unemployment benefits. Gerstenfeld said Oregon has received funding to provide five weeks of the Trump administration’s supplemental $300 weekly payment, retroactive to the week starting July 26. He said payments should go out in September but couldn’t provide an exact date.

The implementation of Senate Bill 1701 would be pushed to December, Gerstenfeld said. He described that measure, which would allow part-time workers to earn more and still get full benefits, as less of a priority than another IT-intensive fix — waiving the so-called “waiting week.”

Sen. Mark Hass, D-Beaverton, reprised a line of questioning from June, when Gerstenfeld first appeared before lawmakers as OED’s director.

Hass again pressed Gerstenfeld on the agency’s failure to modernize its archaic computer system, despite receiving more than $85 million from the federal government in 2009, as well as audit warnings from the state. Gerstenfeld said earlier that the heat of the Great Recession was no time to start an immense modernization project. The agency took pains — and time — he said, to avoid a failed upgrade.

“Reminds me of tsunami warnings to coastal towns who just kind of shrug their shoulders,” Hass said. “And then when the tsunami hits, there’s a lot of explaining.”

Then the senator read an email that he said he had received just minutes before. It was from a person who said they were making money by selling their plasma while waiting for unemployment to come through. They needed help.

“I appreciate the overview,” Hass told Gerstenfeld, “but we still have a battle to fight here on the ground that I don’t think we’re winning.”

The hearings resume at 8 a.m. Wednesday. Gerstenfeld is expected to speak about lessons learned and economic recovery moving forward.

Copyright 2020 Oregon Public Broadcasting