State writes off $800K in salary over payments - Hawaii News Now - KGMB and KHNL

State writes off $800K in salary over payments, hearing set for Tuesday

HONOLULU (HawaiiNewsNow) –   A month after a Hawaii News Now investigation revealed that the state has overpaid some of its employees by more than $2 million in recent years, HNN reported the state has written off nearly $1 million more in over payments as unelectable.

The state is routinely overpaying some employees thousands of dollars and then spending years trying to get that money back. 

In response to a public records request from Hawaii News Now, the state Department of Attorney General said it wrote off salary over payments of 260 current and former state employees worth $882,639 between 2001 and 2010.  That's in addition to the $2 million  overpaid to former and current employees in recent years, about a quarter of which was recovered in the last year or so.

If an employee's account is delinquent for at least two years straight, it can be written off as uncollectable under state law, said Deputy Attorney General Steve Bumanglag. 

An account is uncollectable "when the debtor could not be located, the debtor has filed for bankruptcy and listed the state as a creditor, the debtor has passed away, or it was deemed that collection efforts would be uneconomical," Bumanglag said in response to questions from Hawaii News Now. 

The salary over payments happen when state employees take vacation or sick time without sufficient paid leave to cover their absences, when payroll computation errors occur or because administrative staff fail to stop workers' pay when they go on unpaid leave or quit or retire. 

The state Public Safety Department , which oversees prison guards and sheriffs deputies , had some of the largest amounts of overpaid salaries that were written off, according to the Attorney General's office. 

A total of 200 former public safety employees who received salary over payments could not be located, so $605,427 paid to them between 2001 and 2007 was written off as uncollectable. 

Another $86,001 paid to 11 public safety employees who filed for bankruptcy was also written off. 

And $11,168 owed by four former public safety employees who died still owing over payments was written off as well. 

Other over payments that were written off include:

  • About $51,458 paid to 19 employees at the Department of Human Services between 2008 and 2009.  None of those employees could be located, the Attorney General's office said.
  • Another $37,609 over paid to 20 Department of Transportation employees between 2001 and 2009.  The DOT debtors could not be located, officials said.
  • The Department of Accounting and General Services reported writing off $18,897 overpaid to three employees, two of whom died. 

The Attorney General's office said it was still gathering information on Department of Education overpayment write-offs.   

The education department is the state government's largest employer with 22,000 salaried employees. Not surprisingly, it had the largest overpayment amounts. 

As of Dec. 31, public school employees owed $754,649 in salary overpayments and reported collecting $206,539 in overpayments, according to a report filed with the Department of Accounting and General Services. 

"We're aware this is an issue and that doesn't excuse it, just because we have that volume of employees so we're doing things to try to mitigate those occurrences," said Amy Kunz, the chief financial officer for public schools. 

Kunz said the state has asked school clerks and secretaries, who handle payroll paperwork to be more vigilant.  But she said it's difficult for them to keep up because they have so many other things to do.  

"They're assisting principals and day-to-day responsibilities for that, teachers and students who come in and need assistance.  They have a lot on their plates," Kunz said. 

She said the education department worked with the attorney general's office to pursue more cases and brought in $56,000 from school employees in a one-month period late last year. 

The state is working to computerize its time sheet and payroll system which will prevent a lot of overpayments, but that process will take years and cost millions of dollars. 

The state attorney general's office said it can intercept state tax refunds of current and former employees who owe the state money,  something it's done in "many cases," even after those cases have been written off. 

The State Senate has appointed a special committee on accountability to conduct hearings looking into the over payments that will meet Tuesday, March 13 at 1:15 p.m. in room 224 of the state capitol.  The committee will be chaired by State Sen. Donna Mercado Kim, (D - Moanalua, Aiea, Kalihi Valley, Halawa Valley).

"A great number of people still employed that owe thousands of dollars to the state because of overpayments. First of all, we have to see what's the problem and why it's happening," Kim said. 

Kim said she will call representatives of some state departments to explain what they're doing to take care of the over payment problem at the briefing. She also plans to delve into whether legislators need to change state laws to make it easier to collect extra wages paid to employees. 

In February, Kim introduced a resolution calling for State Auditor Marion Higa's office to investigate the salary over payment problem. 

"Some of it may never be collected, but the problem is we've never written it off," said Dean Seki, the acting state comptroller, who oversees the state payroll.  Seki, who has been with the state's Department of Accounting and General Services for 12 years, just took the department's top job on Feb. 1. 

Seki said a lot of these overpayments happen because Hawaii's state workers still have to fill out old-fashioned paper forms for vacation or sick leave, and that process is not computerized. 

If state employees decide at the last minute to take vacation time at the end of a pay period, often their paychecks have already been cut.   

"You can't possibly do the paperwork to reflect that, so we end up paying the staff person for their salary and later on we have to go and collect it," Seki said. 

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