Bozelko column: Blame for unemployment boondoggle belongs to wardens
Columns share an author’s personal perspective.
Last week several newspapers reported that California’s administration of the Pandemic Unemployment Assistance program paid, ostensibly, about $400 million in benefits to California inmates who weren’t eligible for unemployment payments. Much of it won’t be recouped.
Inmates collecting government benefits is hardly a new story. In California alone, they collected $3.5 million in Social Security payments in 2016, according to the Social Security Administration’s Office of the Inspector General - money they didn’t qualify for. Before the news of the California problems, investigators had uncovered similar misuse of the PUA in Pennsylvania and Maine, and more will undoubtedly be uncovered in other states.
This was a chronic problem when I was incarcerated. Women who collected Social Security disability benefits and Supplemental Security Income would continue to receive checks until a record of their status as an inmate reached the Social Security Administration. Then they would lose them but face an overpayment assessment, which is basically a debt a beneficiary owes the government for getting checks they weren’t eligible for.
This isn’t all the inmates’ fault. An extensive data-sharing infrastructure designed to stop such a multi-perp heist exists. Jail and prison administrators simply aren’t using it properly.
It’s the Social Security Administration’s Prisoner Update Processing System, established by the 1996 Personal Responsibility and Work Requirement Act (better known as President Bill Clinton’s welfare reform bill). It updates an inmate’s Social Security profile with their incarcerated status.
It’s not isolated from other systems. President Barack Obama’s 2017 budget required states’ Unemployment Insurance systems - offices like California’s Employment Development Department, the office responsible for administering unemployment benefits in the state.
Connecting unemployment administration to PUPS should have sufficed to stop the most recent unemployment payments from going to inmates but, as several investigations have revealed, the entry of information by corrections officials is inadequate.
For instance, in New York, an Inspector General’s investigation found that, for about half of inmates who received Social Security payments while incarcerated, the New York Department of Corrections and Community Supervision never updated their status as being in custody. In California, information on over a third of the inmates who collected that $3.5 million in 2016 was never entered into PUPS. Countless more weren’t updated - we just don’t know how many because the audit examined only those who actually received the benefits.
At first glance, these omissions appear like good faith errors by overworked public employees. But the Social Security Administration financially incentivizes reporting by prison administrators. If they update an inmate’s status within 30 days of admission, the facility receives $400. It shrinks to $200 after 30 days and down to nothing after 90 days. It doesn’t seem like a lot, but the year that $3.5 million in Social Security payments went to inmates, the California Department of Corrections and Rehabilitation received $258,000 from the Social Security Administration for 698 prisoners whose benefits they froze.
That seems low. Those 698 inmates constitute one-tenth of 1% of the 368,000 people who enter custody in California every year. About 32% of prisoners are considered disabled prior to entering, although there’s no firm data on whether they collected Social Security disability benefits or not.
While we can’t assume that around a third of new admissions are Social Security beneficiaries, even if just half of that third are, that would lead to approximately $2.4 million incentive payments from the Social Security Administration if all new admissions to custody were all reported on time, making the $258,000 look like what it probably is: a reflection of underperformance when it comes to updating inmates’ profiles.
It’s not limited to California. Many facilities don’t share this information with the Social Security Administration at all. Early on, only about 60% of correctional facilities entered into contracts with the SSA to share this data.
Beefing up reporting requirements for PUPS might seem like the solution here, but this type of waste and abuse won’t stop until lawmakers acknowledge that there’s a bigger incentive for prisons to assure that inmates have expendable resources.
For one, commissaries rake in about $1.6 billion every year from a population whose pre-incarceration income is, on average, 41% less than people in society. The state and various employees receive kickbacks - both legal and illegal - from these companies.
Secondly, the drugs and contraband in prisons aren’t always generated inside. They enter the compounds and buildings when guards smuggle it in - for a price. The average inmate pay of $0.63 per hour won’t entice many of them to engage in illegal acts.
Once we understand that it behooves the system and the bad actors within it to keep its wards flush with cash, a chronic failure to inform the Social Security Administration of new admissions to confinement takes on a different context.
Every economic downturn in this country also included extra efforts to make sure inmates didn’t thrive while society flailed.
During the Great Depression, the Hawes-Cooper Act and the Ashurst-Sumners Act basically stopped prison labor so as to assure inmates had no more employment opportunities than the people staring down a 25% unemployment rate. To stop stimulus payments from going to inmates, President Obama signed the No Social Security for Prisoners Act of 2009. The IRS fought dissemination of stimulus checks to inmates.
Yet still these benefits get paid. The common denominator in all the money that slips past is whether the processing system knows if a recipient is incarcerated or not. The problem here is PUPS and its missing data, which means the problem here is correctional staff.
Of course, sometimes PUPS is up to date and benefits still go out. And prisoners who capitalize on this weakness for fraud - as opposed to those who are victims of identity theft - should have known better.
But certain practices in prisons and jails enable this theft, and they have for a while. It isn’t entirely the prisoners’ fault.
Chandra Bozelko writes the award-winning blog Prison Diaries. You can follow her on Twitter at @ChandraBozelko and email her at firstname.lastname@example.org.