Treasury Offset

New York’s Experience and

Lessons Learned

2012 UI Integrity Summit

UI Integrity – YOU Make it Happen!

Willful overpayment• Title 7 of New York’s Unemployment Insurance Law covers all claim

issues.  A copy is available here: http://www.labor.state.ny.us/ui/dande/article18.shtm. 

• Section 597(2)(c)(3) states: Notwithstanding paragraph (b) of this subdivision, adjustments to the claimant's benefit rate and adjustment to the experience rating charges to the employer's accounts will be retroactive to the beginning of the benefit claim in the following circumstances:

• (3) the amount of the previously established benefit rate was based upon the claimant's willful false statement or representation.

Willful overpayment• Section 597(4) states: Whenever a new determination in

accordance with the preceding subdivision or a decision by a referee, the appeal board, or a court results in a decrease or denial of benefits previously allowed, such new determination or decision, unless it shall be based upon a retroactive payment of remuneration, shall not affect the rights to any benefits already paid under the authority of the prior determination or decision provided they were accepted by the claimant in good faith and the claimant did not make any false statement or representation and did not willfully conceal any pertinent fact in connection with his or her claim for benefits.

• Therefore: Any failure to act in good faith, or any false statement or representation, or any concealment of pertinent facts would be considered fraud!

Debtors• Yes, they are debtors, not claimants• Before TOP

– Benefit offset– Cash– State Offset (taxes, employee wages)– Judgments– Criminal convictions

• How to enable better debt collection?

The Road to TOP

• YOU make it happen (with the help of friends)• Planning• Initial Steps – quick hit letters and $$$• Programming, Testing, Programming,

Testing, Testing, Testing• IRS compliance

IRS Compliance• Quick primer on working with the IRS

• It is worth it – both for tax and benefit purposes• Basic agreement, Implementing agreement• Safeguard Procedures and Activity Reports

(Documentation)• Audits, Reviews, Corrective Action Plans• Need and Use• Training

• The concept of blurring• Data confidentiality

The New York Model• Who to refer and how much to refer?• Staffing• Simple and cheap (if archaic) transfers of

data• Small tools - big reward

The Model

Add-ons and lessons

• Communicating with Treasury– Always there to help– Have the right contact for the issue

• Communicating with debtors– Have backup– Encourage compliance– Right balance

Speed bumps and process snags

• Offset refunds• Bankruptcies• Address updates/due diligence• Hearings and appeals• System issues (leave time)

Results• As of February 22, 2012 –

– Voluntary compliance.• $7.5 million.

– Benefit Offsets.• $1.1 million.

– TOP recoveries.• $32.2 million.

• Total: $40.9 million.• From every state.• 43,800 telephone calls handled by 11 staff.

Moving forward

• New Penalties under TAA• Keeping files current• Fixing bugs

• Data model• TOP Letter samples

Handouts

Thank you!

James A. Konicki, ManagerNYS Department of LaborUnemployment Insurance DivisionTax Program Analysis and Support518-457-5713james.konicki@labor.state.ny.us

We are here to help and are available