WED: State May Have Overpaid $250M In Jobless Benefits, Navajo Nation Now Largest Tribe, + More
Pandemic Emptied Unemployment Trust, Left Fraud Unchecked – By Morgan Lee Associated Press
New Mexico probably overpaid unemployment insurance benefits by an estimated $250 million during the coronavirus pandemic amid a backlog of investigations into potentially fraudulent claims, the budget and accountability office of the Legislature announced Wednesday in a research report.
Analysts briefed members of the Legislature’s lead budget writing committee on the trajectory of record-setting unemployment claims during pandemic.
New Mexico has paid out more than $3 billion in unemployment claims through the state’s Workforce Solutions Department since the local outset of the pandemic in March 2020. That put the state unemployment trust fund into insolvency and in debt to the federal government.
The Workforce Solutions Department last year reassigned staff to help keep pace with a tide of claims as jobs and personal income dried up and drafted workers from other state agencies to answer phones from people who lost jobs and were desperate to sign up for unemployment payments.
“The surge and staffing reassignments exacerbated already rising rates of improper payments,” financial analysts at the Legislative Finance Committee found. “Staff estimate the state has made $250 million in benefit overpayments since the start of the pandemic.”
Analysts attribute $133 million of the estimated overpayments to fraud, including $16 million linked to support intended for gig workers and self-employed contractors. The remainder was linked to a variety of overpayments not involving intentional deception.
The revelations arrive amid turbulence at the Workforce Solutions Department, where Bill McCamley departed as agency secretary a month ago and a review is underway of inflated tax rates on employers for unemployment insurance.
Acting Workforce Solutions Secretary Ricky Serna said the agency was in a bind as it struggled to keep up with an unprecedented tide of legitimate unemployment claims amid brazen fraud schemes by criminals trying to get payouts. Serna said fraud schemes also tied up phone lines with robocalls and appropriated the identities of state unemployment regulators.
“You don’t have enough time to certify that everyone who applied meets the program requirements because you don’t want those people to wait five or six weeks for their money,” he said. “But then five or six weeks later, after they’ve been receiving their money, you realize that wasn’t right, or this was inaccurate or you didn’t provide this. So we need to revisit eligibility. And to be sure, in some instances, it resulted in overpayments.”
Serna, who is performing double-duty as director of the State Personnel Office, said the challenges of limiting overpayments was compounded by new federal pandemic initiatives.
The federally subsidized program that extended unemployment benefits to previously ineligible gig workers and contractors presented huge challenges in terms of verifying applicants’ past income without the help of employers. And the federal paycheck protection program provided bursts of backpay to people already receiving unemployment benefits.
Serna said two specialists are re-evaluating that agency’s workflow, including the backlog in investigations. He said unemployment officials had an emergency plan in place for a possible economic recession that was overwhelmed by the financial downturn of the pandemic.
The state’s rate of unemployment claims peaked in July 2020 with a record 197,000 applications for assistance in New Mexico, which has a population of about 2.1 million residents.
The state has borrowed $278 million so far from the federal government to meet unemployment insurance obligations.
Lawmakers are wrestling with strategies for paying off the debt and restoring trust balance without triggering a sharp tax increase on employers. More than 100,000 people statewide continue to draw unemployment benefits as the economy gradually reopens.
Gov. Michelle Lujan Grisham in April vetoed a plan to funnel $600 million in new federal pandemic relief to the state’s unemployment payments trust — citing uncertainty about spending restrictions. She allowed a separate $100 million contribution to the trust from the state’s general fund.
The U.S. Treasury is allowing states to replenish unemployment funds to pre-pandemic levels — a $460 million balance in New Mexico’s case.
Lujan Grisham, a Democrat, has not yet provided a specific unemployment trust solvency plan. Serna said the state’s unemployment debt would eventually have a compounding effect on tax rate increases for businesses.
New Mexico last week reinstated a requirement that people receiving unemployment benefits show they are actively searching for work.
The state has no plan to end a $300 weekly federal supplement going to roughly 96,000 jobless residents. A growing number of states are halting the $300 payments.
Sarah Dinces, a program evaluator on income support with the Legislature’s accountability office, said that current unemployment benefits in New Mexico may provide a strong disincentive for people to return to work. That is a consequence low median household incomes and robust wage replacement.
Republican state Rep. Jack Chatfield, a rancher and restaurant owner from Mosquero, said businesses, including his own, are struggling to find workers.
“We just can’t get anybody. We can’t get people to come to work,” he said.
Serna said Workforce Solutions is studying the issues and that some parents still can’t return to work because of a daycare shortages, combined with lingering fears of the contagion.
New Mexico Officials Cite Progress In Vaccinating Students – By Susan Montoya Bryan Associated Press
The head of the New Mexico Public Education Department said Wednesday that progress is being made when it comes to vaccinating the state’s middle and high school students now that eligibility has been expanded to include those 12 and older.
Education Secretary Ryan Stewart said during a briefing with reporters that more than 27,000 children between the ages of 12 and 18 are now fully vaccinated. Nearly 13,800 students have received at least one shot and more are scheduled.
Stewart pointed to the decline in new COVID-19 cases being reported each week among students and teachers, saying the vaccination effort is working as the number of schools on the state’s watch list is down by half from just two week ago. Only two schools — a high school in Albuquerque and a middle school in Clovis — were forced to close because of newly reported cases over the last 14 days.
Schools are not driving community spread, Stewart said. Requirements call for unvaccinated students or staff who were exposed outside of school to be quarantined. Close contacts also are being tracked as a way to limit spread.
“Even in those instances where COVID has shown up in a school, we’ve got the right systems in place to keep that from spreading to others,” he said.
Overall, the percentage of New Mexicans 16 and older who are vaccinated neared 53% on Wednesday. While the pace has slowed somewhat, state officials expressed confidence that New Mexico would meet its 60% goal by the end of June. That will trigger the end of its color-coded system for determining risk in each county and the removal of most pandemic-related restrictions on commercial activities.
Currently, all but one county is classified as turquoise. That level includes the fewest restrictions on commercial and day-to-day activities.
As part of the effort to sway more New Mexicans to get vaccinated, state health officials warned that those who have not been vaccinated are about 10 times more likely to be infected as the virus mutates. State officials said more than 98% of newly confirmed COVID-19 cases are in unvaccinated people.
Nearly 530 infections have been reported among people who have been vaccinated in what officials call breakthrough cases, with a few dozen of them being hospitalized. State officials confirmed one death was attributed to COVID-19 while confirmation of another was pending.
Human Services Secretary Dr. David Scrase said there’s still more to learn about these cases as many of the patients showed no symptoms.
“The pandemic is not over,” Scrase repeated. “We have to keep up the full-court press here — vaccinated and unvaccinated individuals — to keep cases down.”
Kickback Trial For Former New Mexico Mayor Is Underway – Associated Press
A trial started this week for a former mayor in New Mexico after she was accused of using her position to give her then-boyfriend city contracts in exchange for kickbacks.
Fourth Judicial District Judge Abigail Aragon is presiding over the trial of former Las Vegas Mayor Tonita Gurule-Giron, which is expected to last until Friday in Las Vegas, about 100 miles northeast of Albuquerque.
Gurule-Giron, 63, pleaded not guilty last year to multiple criminal charges including engaging in an official act for personal financial gain, soliciting or receiving an illegal kickback, conspiracy to commit making or permitting a false public voucher and demanding or receiving a bride by a public officer or employee.
A criminal complaint claimed Gurule-Giron pressured city employees to give contracts to her boyfriend’s construction company without going through the proper process. The complaint also alleged that the invoices were made out in amounts that exceeded the company’s original bid without additional approval.
Charges were filed in December 2019. The case was delayed several times because of the coronavirus pandemic and for other reasons.
Defense attorney JoHanna C. Cox argued in her opening statement that Gurule-Giron was innocent, saying the only thing she did wrong was have a bad relationship with her boyfriend.
“A single woman dating a single man is not a crime in New Mexico, rather the Attorney General is going to put their tumultuous relationship on trial for you,” Cox said. “You’re going to hear that it was not the best relationship. Even not having the best relationship, ladies and gentlemen, is not a crime in New Mexico.”
Assistant Attorney General Andrew Coffing said the prosecution plans to prove Gurule-Giron used her position, information and influence to unlawfully sway the bidding process to help her boyfriend and that she received financial benefits in exchange.
“The types of gifts that we’re talking about are going to seem occasionally like everyday items. It’s roses, it’s an expensive dinner, it’s a phone, it’s occasionally help with utilities,” Coffing said. “These are all items that you might consider would be part of a normal dating relationship.”
The boyfriend, Marvin Salazar, 53, faces multiple charges including offering or paying an illegal kickback and making or permitting a false public voucher. A trial has yet to be scheduled, and Salazar’s attorney, Alan Maestas, declined to comment on the case.
Congressional Candidates Clash On Financial Disclosures – Associated Press
Republican congressional candidate Mark Moores on Tuesday criticized Democratic rival Melanie Stansbury for voting in 2019 for a budget bill in the state Legislature that benefited a one-time client of her consulting practice, in a news release.
A spokeswoman for Stansbury called the criticism a baseless political attack and highlighted Moores’ refusal to file a disclosure about his personal finances as a U.S. House candidate. A spokesman for Moores said that this year’s delayed federal tax deadlines have stood in the way of the financial disclosure requirement.
Early in-person and absentee voting is well underway ahead of the June 1 special election to fill the 1st Congressional District seat held by Deb Haaland before her confirmation as Secretary of the Interior under President Biden.
Campaigning for the seat has cast scrutiny on past legislative votes and personal finances for Moores, a third-term state senator, and Stansbury, who unseated a Republican incumbent from the state House in 2018.
Moores through his campaign notes that Stansbury voted as a state representative for a spending bill that provided $50,000 to the the Utton Transboundary Resources Center that performs public research on water, natural resources and environmental issues, among hundreds of programs at state agencies and universities. A prior state financial disclosure statement from Stansbury lists the Utton Center at the University of New Mexico as a major area of specialization or source of income for her as a consultant.
“These are baseless political attacks. Mark Moores is trying to distract from his failure to comply with federal law — refusing to disclose his financials to New Mexico voters,” Stansbury campaign spokeswoman Jessie Damazyn said in an email.
She says Stansbury has championed reforms to modernize the nation’s only unsalaried legislature and provide greater transparency.
Stansbury filed a financial disclosure statement this year with the U.S. House of Representatives that lists consulting clients including the Wildlife Conservation Society.
The Albuquerque-based congressional seat also is being pursued by for state Land Commissioner independent candidate Aubrey Dunn Jr. and Libertarian nominee Chris Manning.
Can Monthly Cash Payments Cut Child Poverty By Nearly Half? – By Ashraf Khalil Associated Press
The check won’t arrive until mid-July, but Katrina Peters already knows what she’ll do with her Child Tax Credit payments. The 20-year-old mother of three has applied to work as a driver with a food delivery app, and the extra cash is earmarked for repairing, registering and insuring her car.
“I just need to make sure it’s 100% and then I can start working and get an income,” Peters said, cradling her 3-week-old son, Armani. “That’s where it starts.”
The payments are a key part of Democrats’ COVID-19 aid bill passed in March, but for policymakers they are more than just an attempt to help families recover from the pandemic. The monthly checks of up to $300 per child for millions of families are part of an ambitious attempt to shrink child poverty and rethink the American social safety net in the process.
With an emphasis on direct, no-strings cash support, the payments are a deliberate departure from a system that for decades has tried to control how Americans spend their government assistance by funneling it to food, housing or child care. Peters is as free to use the cash on her car as she is to spend it on diapers.
“There’s something huge happening with the idea that the lowest-income people need cash assistance the most,” said Teague Gonzalez, public benefits director with the New Mexico Center on Law and Poverty. “The pandemic opened up a connection to the idea of giving people cash and letting them decide how to use it.”
The expanded CTC payments, which are due to begin going out July 15, are only meant to last a year, but architects and proponents aren’t trying to hide the fact that they want to make this permanent. The coronavirus pandemic, they say, laid bare the inadequacies of America’s support system and provided the political momentum to make lasting changes.
“If implemented well, this could be transformative,” said Emma Mehrabi, director of poverty policy at the Children’s Defense Fund. “This could cut child poverty in nearly half.”
Part of the American Rescue Plan, the Child Tax Credit provisions will increase the payments and greatly expand the number of families eligible. The practical result will be direct payments for each child to families ranging from impoverished to solidly middle class — $3,600 per year for children under age 6 and $3,000 per year for older children. Roughly 39 million households will receive at least partial payments, covering an estimated 88 percent of American children.
Columbia University’s Center on Poverty and Social Policy estimates the cash infusions could lift 45% of children living in poverty above the poverty line — cutting Black child poverty by 52%, Hispanic child poverty by 45% and Native American child poverty by 62%.
In places like New Mexico, a state with one of the highest rates of children living in poverty, this is a potential crossroads. One in 4 New Mexican children is considered impoverished, compared with 1 in 7 nationally.
With three kids under age 6, Peters is due to receive up to $900 per month, and all of it is welcome. Her construction worker boyfriend has been out of work due to the pandemic, she said, her government subsidized housing voucher has expired and only the national eviction moratorium has protected her. Armani requires a special kind of baby formula that she can’t buy with her government nutrition program benefits.
“Sixteen dollars a can, and he goes through it in two or three days,” she said.
Democratic New Mexico Sen. Martin Heinrich said the philosophy behind the payments is to treat child poverty as an avoidable traumatic event — one that has been proved to impact future academic performance, emotional stability, earning power and legal record.
“It affects your ability to have positive relationships, both professionally and in your home life. … The more of these stack up, you’re more likely to have problems with the legal system, unsuccessful relationships, lower lifetime income,” Heinrich said.
Besides a basic acknowledgement by the government that raising children is expensive for almost anybody, advocates said the payments are an expression of faith in the judgment of struggling families.
“It’s an issue of trust. We need to trust these families to do what’s right,” said Jeffrey Hoehn, executive director of Cuidando Los Ninos, an Albuquerque charity that provides housing, child care and financial counseling for mothers transitioning from homelessness. “We find that our single moms, they know where every single penny goes. It’s just that they don’t have enough pennies.”
Hoehn said different families will have shifting needs and resources from month to month, putting the cash toward rent, utilities or even therapeutic leisure activities. In a sprawling town like Albuquerque, it’s hard to find work without a car, and Hoehn said many families his group works with are looking to the extra cash to acquire or fix a vehicle.
For Margarita Mora, the money is earmarked to help cushion her family’s transition to stability. The 36-year-old mother of three had been staying in an Albuquerque motel converted into a family shelter and would soon be getting her own subsidized apartment through Cuidando Los Ninos.
“I’ll be able to pay my utilities and basic supplies, plus gas to go look for work,” said Mora, an unemployed caregiver. “And I need to work on my debt. My credit score isn’t so great.”
The money isn’t only going to the neediest. Carissa Oswald, a stay-at-home mom in Albuquerque whose partner works with the local railroad, counts herself as middle class. But having given up her work as a caregiver to raise her 11-month-old daughter, she finds that money is frequently tight.
“Kids are expensive, right? It would let us breathe a little bit easier,” she said. “The tension is real. The stress is real.”
New Mexico state Rep. Javier Martinez, a Democrat from Albuquerque, calls the CTC a “philosophical shift from mid-20th century programs” like Medicaid and food stamps.
“And I don’t think we’re going back,” he said.
Martinez highlights the fact that CTC payments will be monthly, instead of some annual balloon payment, as a crucial distinction. The smaller monthly boosts, he said, are more likely to be incorporated into the household budget and “create certainty in a family.”
The expanded CTC expires in 2022, although President Joe Biden has proposed extending it through 2025. Whether that happens may depend on whether advocates can demonstrate a positive impact — and whether opponents, primarily Republicans, find evidence of waste.
Heinrich said he expects that opponents will have no problem gathering examples of parents spending money on things deemed unnecessary and he is braced for a revival of the Ronald Reagan-era “welfare queen” trope. The future of the program may well be riding on the outcome of the 2022 congressional elections, when Democrats will seek to retain their slim majorities in both the House and the Senate.
For now, CTC supporters are counting on enough positive examples to counter the criticisms, plus the fact that monthly cash should be popular with both Democratic and Republican families up and down the income ladder.
“There will be plenty of compelling anecdotes on either side of it,” Heinrich said. “At the same time we will have the data by then to show what a difference it has made. I want to see the data, and I suspect that in New Mexico, this will have an enormous impact.”
Associated Press writer Susan Montoya Bryan contributed to this report.
Navajo Nation Tops Cherokee To Become Largest Tribe In US – By Felicia Fonseca, Associated Press
The Navajo Nation has by far the largest land mass of any Native American tribe in the country. Now, it’s boasting the largest enrolled population, too.
Navajos clamored to enroll or fix their records as the tribe offered hardship assistance payments from last year’s federal Coronavirus Aid, Relief and Economic Security Act. That boosted the tribe’s rolls from about 306,000 to nearly 400,000 citizens.
The figure surpasses the Cherokee Nation’s enrollment of 392,000. But it, too, has been growing, said tribal spokeswoman Julie Hubbard. The Oklahoma tribe has been receiving about 200 more applications per month from potential enrollees, leaving Navajo’s position at the top unstable.
The numbers matter because tribes often are allocated money based on their number of citizens. Each of the 574 federally recognized tribes determines how to count its population. Navajo, for example, requires a one-quarter blood quantum to enroll. Cherokee primarily uses lineal descent.
Tribal governments received $4.8 billion from the CARES Act based on federal housing population data for tribes, which some said was badly skewed. The Treasury Department recently revised the methodology and said it would correct the most substantial disparities.
The Shawnee Tribe of Oklahoma, one of three tribes that sued the Treasury Department over the payments, said it’s satisfied with an additional $5.2 million it’s set to receive. The Miccosukee Tribe of Indians in Florida and the Prairie Band Potawatomi Nation in Kansas would get $825,000 and $864,000 under the new methodology. Both said those amounts didn’t make sense when broken down to a per-person figure. They plan to continue their fight in court.
“We just cannot accept this as it is,” Carol Heckman, an attorney for Prairie Band, said in a court hearing last week. “We’re happy to keep talking about it, but Treasury would have to sweeten the pie.”
The Miccosukee Tribe amended its lawsuit Wednesday to reflect the latest arguments.
The Treasury Department will avoid much of the problems it encountered with CARES Act funding in the distribution of the $20 billion for tribes under the American Rescue Plan Act. The department said it will use tribally certified enrollment figures to pay out $12.35 billion and tribal employment data for $6.65 billion.
Another $1 billion will be divided equally among eligible tribal governments, the Treasury Department said. Alaska Native corporations, which own much of the Native land in Alaska under a 1971 settlement, aren’t eligible for any of the $20 billion in funding. The U.S. Supreme Court is deciding whether the corporations will get a slice of the CARES Act money.
The Treasury Department set a Monday deadline for tribal governments to submit their enrollment information online for the American Rescue Plan funding. It acknowledged that no formula perfectly can capture the needs of tribes, which have suffered disproportionately during the pandemic.
Tribes also won’t be under as tight of a deadline to spend the money as they were for the CARES Act and will have more flexibility. They can spend the money to replace lost revenue and improve water, sewer and broadband infrastructure that often lags behind the rest of the U.S.
The Navajo Nation is on track to get the largest share of the enrollment-based funding. About half of its members live on the vast 27,000-square-mile (70,000-square-kilometer) reservation that extends into New Mexico, Arizona and Utah.
The tribe opened the hardship assistance program in November, up against an initial deadline to spend federal virus assistance by the end of the year. It required that applicants be enrolled as Navajo citizens. The response was huge, with the tribe paying out more than $322 million to more than 293,000 applicants, the tribal controller’s office said. Adults received up to $1,350 and children up to $450.
On the American Rescue Plan Act funding, Navajo Nation President Jonathan Nez questioned the fairness of awarding more money to tribes that enroll people with less than one-fourth blood quantum.
“Here on Navajo, we verify blood quantum, and that’s a requirement,” he told The Associated Press. “If they had that same requirement, one-quarter Cherokee, just imagine.”
The U.S. Census reflects higher numbers for Native Americans than tribes’ enrollment records because it allows people to self-identify as Native American and Alaska Native and report ties to multiple Indigenous groups across North America, Central America and South America. Not all of those 5.2 million people are eligible to enroll in tribes. The 2010 count put the Cherokee Nation around 820,000 and Navajo at 332,000.
Cherokee Native Principal Chief Chuck Hoskin Jr. said the recent higher enrollment figure from the Navajo Nation government shows Natives are strong and an important force for economies, education and environment.
“It’s truly a positive anytime our citizenship grows and thrives,” he said in a statement.
Navajo Nation Reports 18 New COVID-19 Cases, 2 More Deaths – Associated Press
The Navajo Nation on Tuesday reported 18 new confirmed COVID-19 cases and two more deaths.
Tribal health officials say the latest figures pushed the total number of cases since the pandemic began more than a year ago to 30,740 on the vast reservation that covers parts of Arizona, New Mexico and Utah.
The known death toll is now 1,295. Navajo Nation President Jonathan Nez said more than half of the reservation’s adult population has been vaccinated.
Nez visited vaccination sites in Kayenta and Chinle on Tuesday to offer his support for health care workers and to encourage local residents to receive the COVID-19 vaccine, which now is available to individuals who are 12 years of age and older.
“The vaccines are key to pushing back on the virus and continuing to bring down the numbers of new infections and deaths,” Nez said. “Please continue to limit travel, wear a mask in public at all times, practice social distancing and wash your hands often.”
Some New Mexico Farms Apply For Pilot Project To Save Water – By Susan Montoya Bryan, Associated Press
More than two dozen farms in southern New Mexico have applied for a program that will pay them not to plant their fields as water managers look for new ways to stretch resources in the drought-stricken state.
It’s the first phase of a multiyear pilot project being managed by the Office of the State Engineer. State Engineer John D’Antonio has described the program as essential for ensuring the aquifers in the lower Rio Grande remain at sustainable levels in the future.
The Legislature approved funding for the effort last year and the state began accepting applications from farmers in the fall. The Interstate Stream Commission is now processing 27 contracts totaling more than $900,000 and covering just over 2 square miles of farmland.
While that represents just a fraction of the agricultural real estate that stretches from Elephant Butte Reservoir south to the Texas border, state officials are looking to develop more tools that can be used to better manage water, especially during extended drought. New Mexico also is on the hook for ensuring a certain amount of water is delivered via the Rio Grande to Texas each year as part of a decades-old water sharing agreement.
Officials pointed to the mega-drought that’s persisted since the late 1990s, suggesting everything from rotating which fields are not planted to recharging underground water reserves and infrastructure improvement should be considered because agriculture is the biggest water user in the state. It represents about three-quarters of all water withdrawals in New Mexico.
The lower Rio Grande Valley has received about one-tenth of an inch of precipitation since the beginning of the year, according to the National Weather Service. That has exacerbated the conditions that have resulted from back-to-back dismal summer monsoon seasons across the southwestern U.S. and limited snowpack over the winter.
Like New Mexico, large swaths of the Southwest are dealing with extreme and exceptional drought — the two worst categories — as water managers are warning of limited supplies from the region’s major rivers, the Rio Grande and Pecos to the Colorado River.
Farmers in central Arizona’s Pinal County already have been fallowing land amid the drought and improving wells to pump groundwater in anticipation of reductions that could come if a federal shortage is declared on the Colorado River. Most operations there are family farms that are among Arizona’s top producers of livestock, dairy, cotton, barley, wheat and alfalfa.
In New Mexico, shrinking rivers and reservoirs also put more strain on regional aquifers as farmers are forced to pump more to irrigate their crops.
Under the pilot program, farmers will receive grants from $400 to $800 per acre to stop pumping groundwater for a year. The Office of the State Engineer will monitor the use of water through site visits, photos, remote sensing and meter readings.
Agency staff are scheduled to brief lawmakers on the effort during a meeting later this week.
Santa Fe Woman Who Fatally Shot At House Party Faces Trial – Santa Fe New Mexican, Associated Press
The trial of a Santa Fe woman accused of firing a gun into her neighbor’s yard, killing a young man, is set to begin this week.
The Santa Fe New Mexican reports that 65-year-old Beverly Melendez was found competent to stand trial for one count of second-degree murder.
According to prosecutors, Melendez, angry over her neighbor’s house party, grabbed a .22-caliber rifle and got up on a stool. She opened fire over a wall separating them.
Authorities say one bullet struck 19-year-old Rodrigo Enriquez-Garay in the back. People at the party rushed him to the hospital where he died.
Defense attorneys as recently as last month filed a motion that Melendez have a second psyche evaluation. According to her legal team, a social worker observed her being forgetful and paranoid.
State prosecutors criticized the motion as an “11th-hour play.”
The motion was denied.
Melendez also faces two counts of negligent use of a deadly weapon. If convicted on all charges, she faces up to 16 years in prison.