State cuts $4M for revamp of unemployment benefits portal

Funds would have rebuilt unemployment portal; competing priorities cited

Don't miss the big stories. Like us on Facebook.  

MONTPELIER — When the Legislature appropriated much of Vermont's $1.25 billion share of federal CARES Act funding last week, a $4 million line item to help the state's antiquated unemployment insurance system make needed user interface improvements was no longer part of the spending plan — despite state Labor Commissioner Michael Harrington's warnings that it would leave that fragile and antiquated system without improvements for the rest of 2020.

"It is important to note that without this [$4 million] allocation, there will be no modernization work that will occur between now and the end of the 2020 calendar year, as no additional federal funds have been allocated to the department outside of monies specifically designated for the administering of the new federal programs (i.e. PUA and PEUC)," Harrington wrote in a letter to lawmakers before they voted to approve the bill without that funding.

But legislators said their priority was to move as much money into the hands of struggling businesses as possible. They're still hoping that the federal government will ease restrictions on CARES Act funds and fund unemployment system improvements, as many other states experienced system meltdowns.

The funding was included in the House of Representatives' version of the bill, H. 966. It was stripped out in the state Senate version, and the House agreed to the change as the legislative session neared adjournment on Friday.

House Speaker Mitzi Johnson on Tuesday said the administration believes the update is critical, "they can work with the Joint Fiscal Committee to get it done as they have on many other emergency funding projects."

There is still about $44 million left in a jointly allocated fund for the administration to use for emergency items without a bill process, Johnson said. "They can do that right now (and have been able to since March if they felt this was critical)," she said in an email. She also credited state Rep. Laura Sibilia, I-Dover, the vice-chair of the House Energy and Technology Committee, for taking the lead in initiating House member support for claimants who could not get through.

State Sen. Richard Sears, D-Bennington, who sits on the Senate Appropriations Committee, is open to revisiting the $4 million request from the Labor Department and the Agency of Digital Services, which manages the state's computer technology, when the Legislature returns August 25. There's still about $140 million remaining in Vermont's share of federal coronavirus relief funds.

"Our goal was to get as much [funding] out to businesses as possible," Sears said Tuesday. "I just became convinced that was our number one goal."

Harrington remains concerned that a second wave of COVID-19 will lead to a repeat of the claims system's well-publicized woes. He's not convinced that Congress will come through, and he's worried that a late August or early September funding approval would leave but four months to build, test and launch a new user portal.

"It’s disappointing," Harrington said Tuesday. "We all can agree we’d love to provide a better experience to claimants, particularly if a second wave of claimants comes along. The improvements we would have made using that $4 million would have been realized by that group of impacted people."

"I don't disagree with [Harrington]," Sears said Tuesday. "It's just that we felt like the House hadn't done enough, and that was a place we could move money.... Something has to give. That's what happens in every appropriations process."

Article Continues After Advertisement

"We still believe there's a good chance Congress will provide something," Sears added.

U.S. Sen. Patrick Leahy, D-Vt., ranking member of the Senate Appropriations Committee, said he's been in regular contact with the state's elected leaders on Vermont's pandemic needs.

"Given the huge numbers of Vermonters who have had to file for unemployment, and the challenges this presented for the State, modernization of the State’s UI system has been part of that discussion," Leahy's office said in a prepared statement. "Senator Leahy has pushed [Senate Majority Leader Mitch] McConnell to bring another Congressional relief package to the Senate floor and would support assistance for states to address processing unemployment benefits as part of this legislation.”


The state's unemployment insurance system, housed on an antiquated mainframe computing system and written in an all-but-forgotten programming language, buckled under the weight of unprecedented claim volume in March as thousands of Vermonters lost their jobs. Phone calls went unanswered as overwhelmed staffers struggled to keep up. The state increased staffing, and finally, flabbergasted by delays, cut thousands of checks for $1,200 each to applicants who had still not gotten through.

Article Continues After These Ads

The $4 million sought by the Department of Labor would have built a new user portal, replacing the current 15-year-old version, which Harrington described as "not user-friendly, hard to work with and very limited." The update, he said, would "not only ... provide better service and communication but also expedite issues and move people through the system more quickly."

That is separate from efforts to replace the computer system altogether. That task is estimated at $40 million, and the federal funding promised for the effort requires states to partner with each other to avoid duplication of services. Vermont had just backed away from a potential partnership with two other states when the pandemic forced Gov. Phil Scott to declare a state of emergency and left Harrington, then interim commissioner, to deal with the system's meltdown.

"I believe we also have currently federal money available for ... system improvement on the table left over from the Obama administration that requires partnership with other states," Johnson, the House speaker, said Monday of the situation. "The deciding factor on this $4 million was the Legislature wanted to prioritize more into business aid and supporting our health care system."

The House version of H.966 passed 143-1 on June 19. The Senate version was introduced on June 22, and sent to the Appropriations committee, which includes Sears and Senate President Pro Tempore Timothy Ashe, D-Chittenden. To meet the Legislature's goal of adjourning by June 26, they had five days to work out their version of the bill, pass it, and then return to the House to hash out differences.

In the first day of discussion, Sears said he wanted to prioritize funding for direct assistance to struggling businesses. "I want to give this to some poor soul who's running a hotel in Bennington that's barely surviving," he told the committee.

Two days later, the committee's chair, Sen. Jane Kitchell, D-Caledonia, reviewed a version of the bill and noted that the $4 million had been stripped out. She said that with states across the country experiencing similar unemployment claims issues, there was reason to hope for targeted federal aid.

Article Continues After Advertisement

"Modernization, which might be desirable, was not as important as some of the other areas," she told the committee. "That's where some money [for other line items in the bill] came from, to be honest. "

That night, Harrington, a Bennington native, and Quinn wrote to the committee, explaining that new federal funding was not yet on the horizon.

"To date, the Department of Labor has received only $1.9 million of undesignated funds from the US government to assist with general UI operations during this pandemic. This includes modernization efforts," the letter said. "At the same time, there have been no indications that additional funding will be provided to the states specifically for modernization efforts beyond the implementation of the new federal programs like Pandemic Unemployment Assistance."

A new user portal, the letter said, "allows us to process massive amounts of claims at a time and allows staff to effectively manage claims and resolve issues. Our current claimant portal is over 15 years old and has many limitations (including some significant security weaknesses)."

Harrington said he had not heard back from the committee or been invited to testify by the time a final vote was taken.

Johnson, in a news conference Monday highlighting the House's actions during the 2020 session, said leadership expects the federal government will provide additional funding to address the system's shortcomings, here and in other states.

In an email Tuesday, she expressed frustration with the entire situation.

"Yes, I think it’s very important — the UI/PUA rollout and customer service has been a disaster. I still have constituents waiting for their first check," Johnsion said. "Yes, I’m willing to take a look at this in August.

"Yes, I’m very frustrated that three days after adjournment, the Administration saying the legislature could have helped when we have been saying since March, 'What do you need? Our constituents are not getting help. You need more call takers. Can we upgrade the software like Rhode Island? Can we assign other people from around state government to simply call people back to tell them we hear you and are working on your case? Can we set up a simple interface for people to at least send an electronic SOS to [the Department of Labor?]' And all we heard was “We got this. It’s getting better. This next step is going to fix the problem.”

Greg Sukiennik covers Vermont state government and politics for New England Newspapers. Reach him at


If you'd like to leave a comment (or a tip or a question) about this story with the editors, please email us. We also welcome letters to the editor for publication; you can do that by filling out our letters form and submitting it to the newsroom.

Powered by Creative Circle Media Solutions