School officials are expressing concern about rapidly increasing unemployment insurance costs in the midst of the COVID-19 pandemic, including a rise in fraudulent claims.
Hartford Superintendent Andrew Cook said that. because of the dramatic reduction in the number of jobs in the area, unemployment insurance was a major cost driver in school budgets last year.
“Legitimate claims were more costly than they otherwise would have been due to the enhanced unemployment benefits,” he said at a virtual meeting between school superintendents and state lawmakers on Friday.
The event was organized by the Washington-Hamilton-Warren-Saratoga-Essex BOCES.
In addition, Cook said school districts are experiencing an increasing number of cases that have been improperly filed.
The state has worked hard to send out unemployment checks as quickly as possible during the pandemic. However, many claims were paid without prior verification by the employing district.
Claims that might otherwise have not been paid were approved and the funds charged to school districts, according to a fact sheet on the issue.
“We are disputing any claims that we believe are fraudulent, but the resolution of these charges has been very slow and inconsistent,” he said.
Cook said the state is introducing a bill to fix the issue.
He said afterward he received word that the state Department of Labor is also looking into the problem.
Unemployment insurance is one of the three priorities that the Chief School Officers Advocacy Committee is focusing on this year.
Cook, who is chairman of the committee, said the group usually has five or more priorities. However, because of the pandemic, the committee wanted to pare down the list to three.
The other two include funding school aid to the greatest extent possible and providing a long-term fix to the problem of small school districts not being able to stay enrolled in small group insurance plans.
Cook said school aid should be distributed equitably based upon a district’s ability to pay and student need. The state should provide Foundation Aid based upon the formula to target the neediest districts.
He also wants the state to provide school districts with baseline figures, so they can properly budget for the next year. The state has withheld some aid payments in the current year because of revenue shortfalls.
“We’ve really had no guidance as to what our final aid allocations are going to be this year,” he said.
Providing a predictable funding stream would allow districts to plan, he said.
The other issue is one that has vexed the committee for years. In 2016, the state changed the definition of a small group for health insurance purposes from having 50 or fewer full-time equivalent employees to having 100 or fewer. As a result, a number of small school districts would have been forced to leave their health insurance consortium through BOCES and get insurance on the open market.
The cost would be dramatically higher and the plans would be of lower quality, according to Cook.
“We would have an increased cost of over $200,000, which would require a 6% increase to the tax levy,” he said.
The Legislature has passed short-term exemptions, according to Cook. He would like a permanent fix. The current exemption is set to expire in 2022. While that may seem like a long way off, he said districts have to negotiate health insurance changes with their employees.
The issue has become more relevant as districts have trimmed staff through attrition and not rehired people, dropping more of them below the 100-employee threshold.
Because the event was held virtually, the BOCES culinary students were not able to serve breakfast to the elected and school officials. However they packaged up some baked goods to deliver the previous day.
The event normally recognizes businesses who have partnered with BOCES. In lieu of that, a panel discussion with students, about coping with the pandemic, was held.
Participating were: Fort Edward senior Heather Miller, Hartford sixth-grader Landon Cook, Queensbury senior Eliza Lockwood, Queensbury third-grader Mitchell Muldner and Schuylerville senior Ara-Noelle Ramos.