Execs with company offered contract for Ky. unemployment system upgrade indicted by feds

Execs with company offered contract for Ky. unemployment system upgrade indicted by feds
Published: Sep. 16, 2022 at 10:58 AM EDT
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FRANKFORT, Ky. (WKYT) - It’s back to the drawing back for Kentucky’s unemployment system.

Upgrades to the system that were shown to be inadequate to handle tens of thousands of claims during the pandemic will have to wait even longer.

This comes after labor cabinet officials told lawmakers the company thought to be handling the massive $47 million project has suddenly gone unresponsive.

Cabinet officials told lawmakers the company has not responded to multiple attempts to contact them about the status of that order. To make matters worse, labor cabinet officials have learned several people with that company were recently indicted by the feds.

Our partners with the Herald Leader say the company is Minnesota-based Sagitec Solutions.

“Well, it is certainly disappointing. And it should be disappointing to the people of the Commonwealth of Kentucky. We are three years, two cabinets, three cabinet secretaries, several program administrators, hundreds of millions of dollars, two RFPs and we are not one step closer on the unemployment insurance debacle,” said Rep. Russell Webber, R-Shepherdsville.

The Kentucky Labor Cabinet is going to seek more requests for proposals. That is basically the same as bidding out a contractor to build the system and they hope to have that done by the end of this month.

State officials believe the earliest that a new system can be online now is 2025.

Governor Andy Beshear’s communications director issued a statement Friday afternoon that said, in part, that Gov. Beshear inherited, in his third month in office, an underfunded, understaffed and out-of-date system. She says Governor Beshear has also taken action to increase staff to process claims more quickly.