State resumes upgrading unemployment computer system

Kentucky is facing another major delay in replacing its outdated computer system at the Office of Unemployment Insurance.

The state recently canceled the last request for proposals for the upgrade project and reluctantly decided to start over, Cabinet Secretary for Education and Labor Jamie Link said Thursday.

Proposals from interested vendors had to be submitted by Oct. 19 last year for the estimated $47.5 million upgrade, which is expected to take 18 to 24 months, the Lexington Herald-Leader reported.

“We had – in good faith, we had bought a new supplier,” Link told a legislative panel.

“We had gone through negotiations,” he said. “Everyone was in agreement. We had the contract, we sent it to the seller to sign. And they were completely silent about us. We have made many efforts to contact the seller, several times. They wouldn’t answer us at all.

The firm has learned that two “individuals affiliated with this vendor” have been indicted by a federal grand jury, Link said.

The firm’s new schedule is to issue another request for proposals by the end of September, and the time frame to complete the project is now 36 to 42 months, Link said.

The Unemployment Insurance office has struggled to handle an influx of unemployment insurance claims during the COVID-19 pandemic.

This story was originally published September 15, 2022 7:52 p.m.

Gordon K. Morehouse