Thousands to get unexpected bill from the State

PHOENIX - Lately we've been getting a steady stream of complaints about overpayments for unemployment benefits.

They are bills in the mail asking you to pay the government back hundreds--sometimes thousands--of dollars.

The Arizona Department of Economic Security handles collection duties.

They tell us unemployment overpayments are usually caused by three issues:

-Claims continuing to be made after returning to work
-Benefits claimed despite failing to meet state work search requirements
-Untimely or inaccurate information from employers or third party administrators

Whatever the reason, AZDES tells me once they are aware of an overpayment, a revised statement is sent out.

Michael Hannappel of Phoenix says, that statement, is about all he got.

"No explanation whatsoever just a bill for $1,500," said Hannappel.

Even more confusing, he hadn't received unemployment insurance in more than 2 years.

"I am unaware of why I would owe this money," said Hannappel.

He says he called AZDES several times but could not get an answer about why he owed the money.

So he let me know.

AZDES responded quickly saying they "identified a system error" and that Michael would get an updated statement in the mail.

He got it.  

The statement said Michael actually owed $150 rather than $1,500 and that he received too much Federal Additional Compensation (FAC).

The program was a part of the American Recovery and Reinvestment Act of 2009, and paid an additional $25 to some who received unemployment benefits between February 2009 and December 2010.

According to AZDES, nearly 70,000 Arizonans received $13 million in FAC overpayment during that time and they are looking to recoup that money.

They also say there was a delay in sending out updated statements because the computer system they used at the time "did not have the capability to adequately track those overpayments and process them."

They add that the problem has been corrected and they are actively looking for repayment.

If you get an overpayment statement and believe it is an error, you can appeal it.

Find out how to do that here .

Let me know about your consumer issues by emailing me at or by "Liking" my Let Joe Know Facebook Page and telling me about it there.

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