LOUISVILLE, Ky. (WDRB) -- During the COVID-19 pandemic, thousands of Kentuckians found themselves suddenly out of work, including Scott Clark from Oldham County, a handyman who turned to unemployment benefits to help his family survive.
"We filled out for unemployment," Clark said. "My wife got approved first, then I got approved."
But Kentucky's unemployment system, which relies on computer software dating back to the 1970s, struggled to handle the surge in claims during the pandemic.
"The only reason I did it was, during pandemic, I had to pay bills, and they offered it," Clark said. "You can apply for the Pandemic Relief Fund, so that's what we did. Now, they want it all back and then some."
Clark has received more than 10 letters from the state of Kentucky saying he was overpaid unemployment benefits and must repay the money or face a lien on his property.
One letter says the overpayment was discovered because of "an office error." Another bill says Clark was overpaid $4,200 in 2021, while a separate notice says he was overpaid an additional $3,900. Clark said the amount has continued to grow.
"It's doubled," he said. "Now, it's $23,000."
The letters say interest and penalties are zero.
State officials declined requests for an interview. However, WDRB Investigates has learned the state sent 38,476 overpayment letters to Kentuckians related to pandemic-era unemployment benefits.
"Of the 38,476 overpayment letters that were sent, 34,704 letters were found not at fault and the payment was waived," said Rosalind Harvey, a spokesperson for the Kentucky Education and Labor Cabinet.
She wrote, "UI identified a total of $31,667,274 in overpayments that must be paid back under state and federal law. This time of year, it’s typical to see a seasonal rise in the number of unemployment claims. OUI is reporting higher call volumes which is leading to longer wait times. The agency is taking proactive steps to help Kentuckians submit claims without waiting in line to speak with a customer service representative."
Clark said his wife received one of those waivers. Her letter said she didn't have to repay $2,464 because the overpayment was the result of a "departmental error."
Harvey said the pandemic placed extraordinary strain on unemployment systems nationwide.
"Like every state across the country, the COVID pandemic put unprecedented stress on unemployment systems, the majority of which were federally funded through temporary pandemic relief programs," Harvey said in a written statement. "Due to the unprecedented circumstances of the pandemic … the federal Department of Labor issued guidance following the pandemic instructing states that many of these types of overpayments may be waived if the claimant was not at fault for the overpayment, and paying it back would be against equity and good conscience, meaning it would be unfair to the claimant and cause unnecessary financial hardship."
Clark said state officials told him the overpayment was due to missing tax records.
"They said the reason I owed it was because they never got my 2020 taxes," Clark said. "So I said 'If I send my 2020 taxes, will that take care of it?' They said 'Oh yeah, that'll take care of it.' So we sent it in. They sent us a letter back saying it's not going to take care of it."
Attempts to reach the unemployment office by phone often end with an automated message.
"We apologize, but we're currently experiencing a high call volume," the recording says. "Please try your call again."
"That's how it is. You can't get ahold of them," Clark said. "You can't get a hold of them you can't get any answers. Yet they tell you you owe all this money. It's kind of like 'show me proof.' They've never sent me any proof."
Kentucky has a $55.5 million contract with Deloitte Consulting to replace the outdated unemployment system. The first phase, which upgrades the employer tax system, is expected to go live in mid-2026. A second phase, designed to improve unemployment claims, payments, benefits and appeals, is not expected to be ready until 2028.
Clark said he just wants the state to treat him the same way it treated his wife.
"Just drop it, like they did to my wife," he said. "Now they're going after me. I don't know why."
And after WDRB Investigates asked the state about Clark's case, Harvey said their office "determined the overpayment was an error that will be waived."
WDRB also has an open records request pending with the state that hasn't yet been fulfilled.
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