State leader tackles waste, fraud with stellar results
Editor’s note: Dale Folwell, Assistant Secretary of Commerce, was the guest speaker at the Al-Pam Chapter of the Republican Party monthly meeting in Williamston on March 5th. The next day, reporter John Woodard met with Folwell. This is the first of a two-part interview.
WILLIAMSTON — Secretary Folwell believes the first thing about being a Conservative is that we should not allow others to cause us to lose sight of what conservatism really is — which is to get more out of less.
Then, Conservatives should never be afraid to ask the right questions.
In the 60s, there was a saying that “if you control the laws and I control the music, ultimately I will win.” That means if you do not have people who know what a law means and how to implement it, at the end of the day, it will be meaningless.
Folwell assumed his post over two years ago, when North Carolina was the third most indebted state in the United States in terms of money borrowed from the Federal Government, behind only California and New York. At its peak, the state’s indebtedness stood at $2.8 billion.
With unemployment insurance being employer funded (as a Captive Insurance Company) with no funding from the General Assembly or Congress, and premiums paid by employers, we had the most broken unemployment agency in the United States.
Our BTQ scores (a measure of quality) were 12 out of 100. Folwell suggests that any other product or service, with the same performance scores, would be a product or service that the typical consumer would not use.
But, the employees of our state were forced to consume what we were giving them!
Since he took over, BTQ scores have climbed from 12 to 72 in just two years. That means we are cutting fraud and abuse as well as paying off debt.
Compassion for employees means that when we send them a check we are not going to come back to them to get our money back. This not only keeps fraudsters out of the system, but ensures that the agency is doing its job correctly from the start!
The Commerce Department faced several headwinds in trying to gain control, including a 280 day backlog of applications, plus his own return phone calls would take 20 days, plus the debt inherited. In order to make certain that recipients were valid, the agency instituted a photo ID program. Folwell considered the argument against photo ID as ridiculous.
The Homeland Security Agency, under President Obama, requires that you have a photo ID in order to apply for a job. So it seems perfectly reasonable to make recipients prove their identity.
Folwell said the ‘pay and chase’ process was ridiculous, which had caused most of the $2.8 billion debt.
Before he arrived, they were paying money out the door and then chasing down the applicant through other sections of the agency, which contributed to the overall problems they faced. He decided that they needed to do the job correctly, not just quickly.
Among corrective measures taken, was to add one week for administration on the back of the one-week waiting so that they could hear from the employer. In many instances, by the time the employer replied to the agency, the employee was already receiving benefits before the employer could furnish documentation to show that the employee was not entitled to those benefits. By adding the extra week, they were able to weed out the applications that were not meritorious and focus on those that were.
The original $2.8 billion in debt has now been paid down to $300 million, which will be paid off in eight weeks. In the process they obtained a waiver of penalty in 2014, from the Department of Labor, which has saved our state $180 million. Because of this, the FUTA tax goes away — saving $280 million. If they can get the surplus built up to $1 billion, the SUTA tax saved will be $250 million totaling $700 million in potential tax relief for North Carolina employers.
It is the position of the secretary, and his goal, to push power away from himself and that the same should be true for other conservative leaders as well.
When asked if the governor has been supportive of his agency and the results they have achieved, he stated that he was very honored that the governor recognized him in the recent State of the State address, by having him stand to be recognized as an example of the McCrory administration.
Another saying, in which he believes, is: Listen, then think, then act. He also says that money goes where it is wanted and stays were it is welcome!
Reporters Note: Secretary Folwell served in the Legislature before being tapped for his current post. In next week’s paper, we will tell our readers about that part of the story of this very effective and humble man.