Reform legislation requiring the state’s Employment Development Department (EDD) to meet deadlines for fixing how it handles claims and implements fraud prevention has been unanimously passed by a Senate committee and is scheduled for another hearing next week.
SB 232 is meant to address the litany of problems at the EDD, which has failed to serve Californians, many of whom lost their jobs through no fault of their own, the bill’s sponsor, Sen. Jim Nielsen, R-Tehama, told the Northern California Record by email.
“Criminals received billions of dollars, while unemployed Californians waited for hours on the phone only to be disconnected or receive no help at all,” Nielsen said. “Over a year into the pandemic, and more than a million Californians are still waiting. SB 232, if passed into law, will implement statutory permanent changes to EDD to prevent future delays and fraud.”
SB 232, which unanimously passed the Senate Labor Committee on April 26, now heads to the Senate Appropriations Committee.
An estimated $10 to $30 billion has been lost to EDD fraud. The hearing included testimony from impacted claimants, ABC10 reported.
“The impact of this fraud at EDD is a tremendous loss to California citizens,” Nielsen told the Record. “The money lost could have been spent on revitalizing businesses and other worthy causes. The exact cost of this debacle is not yet known. Billions went to criminals and fraudsters.”
The fraud has weighed on California’s economic recovery.
“These monies should have gone to help those who are truly in need,” Nielsen said. “Those unemployed would have received their benefits quicker and allowed them to pay for rent and utilities.”
The nonpartisan State Auditor has recommended legislative action to ensure that the EDD implements fraud prevention measures.
“To protect taxpayers’ hard-earned dollars, SB 232 must become law to force permanent and substantive changes at EDD,” Nielsen said. “The state will experience another recession. Government must prepare now to serve the people in their time of great need and stress, and not wait until the next recession to hit.”