Date: 09/04/2013
Final
Presentation: PTC Rebate Audit Findings
ECONOMIC OPPORTUNITY POVERTY REDUCTION TASK FORCE
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02:48 PM -- Presentation on PTC Rebate Audit Findings
The committee came back to order. Senator Kefalas asked Trey Stanley and James Taurman from the Office of the State Auditor (OSA) to come to the table and begin their presentation on the audit of the Property Tax/Rent/Heat (PTC) rebate program. Mr. Stanley distributed a copy of the audit (Attachment A) and explained that rebates are divided into two categories: rent and heat. He said that applicants can receive a rebate of up to $700 a year, but most receive less. He reviewed the qualifications and income eligibility requirements, and stated that the Taxpayer Services Division within the Department of Revenue (DOR) oversees the program. He said that the program is funded through General Fund dollars and is not limited by an appropriation, so as long as a person is eligible for the rebate there won't be a cap on the amount they receive. Mr. Stanley said that the objectives of the audit were: to ensure that only eligible applicants were being approved for the rebate; to determine if people were aware of the program; and to examine the efficiency and effectiveness of the program's administration. Senator Kefalas asked Mr. Stanley to discuss the reasons for the decrease the number of rebate recipients. Mr. Stanley stated that the audit did not show any specific reasons, but that program outreach could be responsible for the decrease in numbers. Senator Kefalas asked about eligibility income thresholds and Mr. Stanley answered that this was not within the scope of the audit.
13 EOPRTaskForce0904AttachA.pdf
02:59 PM
Mr. Taurman explained the DOR Gen Tax system in terms of processing and payments. Senator Kefalas asked how many applications were denied and how many were approved. Representative Fields asked about underpayments to recipients. Mr. Taurman answered that 45 percent of the recipients surveyed in the audit were not paid the correct amount. He said that when the audit findings were presented, DOR explained that the income thresholds change every year and were not updated in the Gen Tax system. He stated that the audit found that DOR does not have a process in place to notify recipients of payment errors. Senator Kefalas asked why DOR did not update the income thresholds prior to the application deadline. Mr. Taurman responded that DOR said the updates were not made in a timely fashion. Senator Kefalas asked why rebates are paid out in four installments. Mr. Taurman answered that state law requires the rebates to be paid in four installments because of supplemental income requirements.
03:10 PM
Mr. Taurman continued to tell the task force about the issues with the Gen Tax system and the verification process, as well as the relationship between DOR and the Colorado Department of Human Services (CDHS) in regards to the PTC rebate program. Mr. Tuarman told the committee that CDHS provides data from the Colorado Benefits Management System (CBMS) to DOR to input into Gen Tax for verification. Senator Ulibarri asked about the accuracy of the data and how it is determined that a person qualifies for the rebate due to a disability. Mr. Stanley responded that statute requires that someone already be receiving disability assistance in order to qualify for a PTC rebate. The task force discussed reasons why some applications for the rebate were denied and whether the reasons for denial were in line with statutory requirements.
03:18 PM
Mr. Taurman discussed the history of the PTC rebate program, and talked about the need to blend resources and improve program outreach. He stated that per statute, DOR is required to provide PTC rebate forms to the Public Employees' Retirement Association (PERA). The task force discussed ways to improve the program's outreach efforts and statutory changes needed to support improved outreach and cost efficiency. Senator Kefalas asked if the DOR website includes up-to-date information and is user-friendly. Mr. Taurman responded that the information is current but that the audit did not examine whether the website is user-friendly. Senator Kefalas wanted to know if DOR accepted OSA's recommendations pertaining to collaboration with other departments. The task force discussed transferring responsibility for the program from DOR to CDHS, and whether a hybrid model would be more efficient and cost effective.
03:33 PM
Mr. Stanley discussed the benefits of CDHS managing the rebate program since it already administers similar programs. Mr. Stanley continued to review the OSA recommendations, and explained that the Legislative Audit Committee requested that DOR and CDHS report back to the committee in December on their progress implementing the recommendations in the audit. Senator Kefalas thanked Mr. Stanley and Mr. Taurman and pointed out the statutory requirements that the departments have not followed in regards to the PTC rebate program. The task force discussed ways to recover the overpayments made to recipients and the need to continue evaluating the effectiveness of the rebate program.
The following people testified:
03:48 PM -- Herb Homan, representing the Colorado Senior Lobby, came to the table. He distributed a handout (Attachment B). He stated that his views are his own and not representative of the Senior Lobby. Mr. Homan told the committee about difficulties he's faced during retirement, especially since the benefits and income thresholds have not been adjusted for inflation since the 1990s. He talked about the work of the PTC coalition, and specific areas of the PTC rebate program that the OSA audit missed. He told the task force why CDHS should manage the program and discussed other ways to improve the program.
13 EOPRTaskForce0904AttachB.pdf
04:05 PM -- Eileen Doherty, representing the Colorado Gerontological Society, came to the table. She suggested auto-enrolling people into the rebate program who are already receiving other benefits. She talked about ways to improve the program and how to increase participation rates.
04:10 PM -- Pat Ratliff, representing Colorado Counties, Inc. (CCI), came to the table. She talked about the importance of the rebate program and stated that CCI should be involved in future discussions about how to improve the program.