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The Colorado Department of Labor and Employment office in Denver's Capitol Hill neighborhood on March 21, 2020. (Eric Lubbers, The Colorado Sun)

Colorado’s labor department on Thursday began notifying the first group of out-of-work Coloradans that their federal unemployment benefits are getting ready to start. 

“We just started emailing about 230,000 people,” Cher Haavind, deputy director of the Colorado Department of Labor and Employment, said in a message early Thursday afternoon. 

Members of a private Facebook group for the unemployed in Colorado also began sharing the emails from the Department of Labor. Those on pandemic aid who had not used up their benefits on Dec. 26 could reopen their claims on Monday, Feb. 1, to request a payment. The $300 weekly bonus, known as the Federal Pandemic Unemployment Compensation, will be paid automatically, according to the email.

At least 170,000 people on unemployment saw their benefits end on Dec. 26, after the federal CARES Act relief programs ended. The new relief plan was signed by President Donald Trump a day later, but it took weeks to get Colorado’s new computer system up and running and programmed to disburse the new benefits. Those include 11 weeks of extended benefits to those who had exhausted their claims, plus paying an additional $300 per week for 11 weeks to anyone eligible for unemployment pay of at least $1 a week.

After the delays in Congress to pass a bill, the labor department said the federal fund would not be available until late January or early February. 

Last week, state officials said that the federal benefits would roll out in four phases, starting on Friday at the earliest. This first group includes people on regular unemployment already making a weekly request for a benefit payment. Those folks would see the bonus $300 automatically paid into their bank accounts.

The first group also includes people on pandemic relief who hadn’t exhausted their benefits by Dec. 26. This group should get an email informing them that they can reopen their account to certify their eligibility for the week and any past weeks back to Dec. 27. Their current claim plus payments for the past weeks will include the $300 per week bonus that would all be paid at once.

The second phase of the federal rollout targets pandemic users who exhausted their benefits by Dec. 26. This includes those on the self-employed and gig workers on Pandemic Unemployment Assistance (PUA), plus those on Pandemic Emergency Unemployment Compensation (PEUC). A third group who lost their State Employment Benefits (SEB) on Nov. 28, would return to PEUC for the 11 weeks.

Next steps

In the email, the Department of Labor is asking all recipients to first file a regular unemployment claim because it is “required per federal law to ensure there are no W-2 wages reported.”

The Colorado Department of Labor is asking all those on pandemic unemployment to apply for regular benefits first before they can reopen their old pandemic claim. (Handout)

But for people who’ve exhausted their 26 weeks of regular benefits (based on W-2 wages) or don’t qualify because they’re PUA users, those recipients are then instructed to return Monday to reopen their old pandemic claim. If a user is unable to open the claim then, that means it’s been exhausted and they must wait for Phase 2.

The $300 FPUC payment will be paid after the claim is reopened and each week is certified. 

People on regular unemployment who’ve been collecting benefits for the past several weeks will see the bonus payments start Sunday and “paid in consecutive daily payments until all back weeks are paid,” according to labor department officials.

It’s apparently quite a process to make those payments, which could give some people on unemployment an extra $1,200-$1,500 for four to five weeks of retroactive pay.

Each day, the state takes all the payment requests for that day and sends them in a file to the bank, which then must distribute them to user’s accounts. Officials said delays can occur, for example if “the overall file appears too large, which would cause a pause for that day in the regular state payments of FPUC.”

For those who are on Phase 2, there is still no estimated start date because reprogramming benefits for those who’ve already exhausted them is more complex.

A smaller group of users who lost benefits after the State Extended Benefits program ended on Nov. 28 are winding up in both Phase 1 and 2.

If you were on SEB and didn’t move to a new program, your benefits will return in Phase 2. You will move to PEUC for 11 weeks more of benefits, plus the $300 weekly bonus.

But some on SEB did as the labor department advised and applied for PUA in December. They were able to collect benefits until Dec. 26. Such users are eligible for Phase 1 because their PUA claim has not been exhausted.

The catch here is that when Phase 2 begins, this group will have to move back to PEUC since, per federal law, they must exhaust their regular benefits first. If this is you, the state says go ahead and join in Phase 1.

“We are not advising claimants to hold off. The system will automatically adjust the claims once Phase 2 goes live with the PEUC and credit those weeks that were paid on PUA towards PEUC so that the programs pay out in order,” according to a labor official.

What’s Working: Here’s how Colorado is rolling out federal unemployment benefits, plus Paycheck loans are hopping

This story was updated as more information came in on Jan. 28, 2021.

Tamara Chuang writes about Colorado business and the local economy for The Colorado Sun, which she cofounded in 2018 with a mission to make sure quality local journalism is a sustainable business. Her focus on the economy during the pandemic...