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H0578.......................................by COMMERCE AND HUMAN RESOURCES EMPLOYMENT SECURITY RESERVE FUND - Amends existing law to provide that, for calendar year 2006, the imposition of a reserve tax for the Employment Security Reserve Fund shall not be precluded even if the balance of the reserve fund exceeds forty-nine percent of the actual balance of the Employment Security Fund. 02/08 House intro - 1st rdg - to printing 02/09 Rpt prt - to Com/HuRes 02/14 Rpt out - rec d/p - to 2nd rdg 02/15 2nd rdg - to 3rd rdg 02/21 3rd rdg - PASSED - 55-15-0 AYES -- Anderson, Andrus, Barraclough, Bastian, Bayer, Bedke, Bell, Bilbao, Black, Block, Boe, Bolz, Bradford, Cannon, Collins, Deal, Denney, Edmunson, Eskridge, Field(18), Field(23), Garrett, Harwood, Henbest, Jaquet, Kemp, Lake, LeFavour, Martinez, Mathews, McKague, Miller, Mitchell, Nielsen, Nonini, Pasley-Stuart, Pence, Ringo, Roberts, Rusche, Rydalch, Sali(Sali), Sayler, Schaefer, Shepherd(2), Shepherd(8), Skippen, Smith(30), Smith(24), Smylie, Snodgrass, Trail, Wills, Wood, Mr. Speaker NAYS -- Barrett, Brackett, Chadderdon, Clark, Crow, Ellsworth, Hart, Henderson, Loertscher, McGeachin, Moyle, Raybould, Ring, Shirley, Stevenson Absent and excused -- None Floor Sponsor - Schaefer Title apvd - to Senate 02/22 Senate intro - 1st rdg - to Com/HuRes 03/01 Rpt out - rec d/p - to 2nd rdg 03/02 2nd rdg - to 3rd rdg 03/07 3rd rdg - PASSED - 33-0-2 AYES -- Andreason, Brandt, Broadsword, Bunderson, Burkett, Cameron, Coiner, Compton, Corder, Darrington, Davis, Fulcher, Gannon, Geddes, Goedde, Hill, Jorgenson, Kelly, Keough, Langhorst, Little, Lodge, Malepeai, Marley, McGee, McKenzie, Richardson, Schroeder, Stegner, Stennett, Sweet, Werk, Williams NAYS -- None Absent and excused -- Burtenshaw, Pearce Floor Sponsor - Cameron Title apvd - to House 03/08 To enrol 03/09 Rpt enrol - Sp signed 03/10 Pres signed 03/13 To Governor 03/14 Governor signed Session Law Chapter 48 Effective: 01/01/06
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]] Fifty-eighth Legislature Second Regular Session - 2006IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 578 BY COMMERCE AND HUMAN RESOURCES COMMITTEE 1 AN ACT 2 RELATING TO THE EMPLOYMENT SECURITY LAW; AMENDING SECTION 72-1347A, IDAHO 3 CODE, TO REVISE CONDITIONS WHEN A RESERVE TAX MAY BE IMPOSED FOR CALENDAR 4 YEAR 2006; DECLARING AN EMERGENCY AND PROVIDING RETROACTIVE APPLICATION. 5 Be It Enacted by the Legislature of the State of Idaho: 6 SECTION 1. That Section 72-1347A, Idaho Code, be, and the same is hereby 7 amended to read as follows: 8 72-1347A. EMPLOYMENT SECURITY RESERVE FUND -- SPECIAL ADMINISTRATION 9 FUND. (1) There is established in the state treasury a special trust fund, 10 separate and apart from all other public funds of this state, to be known as 11 the employment security reserve fund, hereinafter "reserve fund." Except as 12 provided herein, all proceeds from the reserve tax defined in subsection (2) 13 of this section shall be paid into the reserve fund. The moneys in the reserve 14 fund may be used by the director for loans to the employment security fund, 15 section 72-1346, Idaho Code, as security for loans from the federal unemploy- 16 ment insurance trust fund, and for the repayment of any interest bearing 17 advances, including interest, made under title XII of the social security act, 18 42 USC 1321 through 1324, and shall be available to the director for expendi- 19 ture in accordance with the provisions of this section. The state treasurer 20 shall be the custodian of the reserve fund and shall invest said moneys in 21 accordance with law. The state treasurer shall disburse the moneys from the 22 reserve fund in accordance with the directions of the director. 23 (2) A reserve tax is imposed on all covered employers required to pay 24 contributions pursuant to section 72-1350, Idaho Code, except deficit employ- 25 ers who have been assigned a taxable wage rate from deficit rate class six 26 pursuant to section 72-1350(8)(a), Idaho Code. The reserve tax shall be due 27 and payable at the same time and in the same manner as contributions. If the 28 reserve fund is less than one percent (1%) of state taxable wages in the 29 penultimate year as of September 30 of the preceding calendar year, the 30 reserve tax rate for all eligible, standard-rated and deficit employers shall 31 be equal to the taxable wage rate then in effect less the assigned contribu- 32 tion rate and training tax rate. The provisions of this chapter which apply to 33 the payment and collection of contributions also apply to the payment and col- 34 lection of the reserve tax, including the same calculations, assessments, 35 method of payment, penalties, interest, costs, liens, injunctive relief, col- 36 lection procedures and refund procedures. In the administration of the provi- 37 sions of this section and the collection of the reserve tax, the director is 38 granted all rights, authority, and prerogatives granted the director under the 39 provisions of this chapter. Moneys collected from an employer delinquent in 40 paying contributions and reserve taxes shall first be applied to pay any pen- 41 alty and interest imposed pursuant to the provisions of this chapter and shall 42 then be applied pro rata to pay delinquent contributions to the employment 43 security fund, section 72-1346, Idaho Code, and delinquent reserve taxes to 2 1 the reserve fund pursuant to this section. Any interest and penalties col- 2 lected pursuant to this subsection shall be paid into the state employment 3 security administrative and reimbursement fund, section 72-1348, Idaho Code, 4 and any interest or penalties refunded under this subsection shall be paid out 5 of that same fund. Reserve taxes paid pursuant to this subsection may not be 6 deducted in whole or in part by any employer from the wages of individuals in 7 its employ. All reserve taxes collected pursuant to this subsection shall be 8 deposited in the clearing account of the employment security fund, section 9 72-1346, Idaho Code, for clearance only and shall not become part of such 10 fund. After clearance, the moneys shall be deposited in the reserve fund 11 established in subsection (1) of this section. No reserve tax shall be imposed 12 for any calendar year if, as of September 30 of the preceding calendar year, 13 the balance of the reserve fund equals or exceeds one percent (1%) of the 14 state taxable wages for the penultimate calendar year, or exceeds forty-nine 15 percent (49%) of the actual balance of the employment security fund, section 16 72-1346, Idaho Code. Provided however, and not withstanding any other provi- 17 sions of this subsection, for calendar year 2006, the imposition of a reserve 18 tax shall not be precluded even if the balance of the reserve fund exceeds 19 forty-nine percent (49%) of the actual balance of the employment security 20 fund. 21 (3) The interest earned from investment of the reserve fund shall be 22 deposited in a fund established in the state treasurer's office, to be known 23 as the department of commerce and labor special administration fund, hereinaf- 24 ter "special administration fund." The moneys in the special administration 25 fund shall be held separate and apart from all other public funds of this 26 state. The state treasurer shall be the custodian of this fund and may invest 27 said moneys in accordance with law. Any interest earned on said moneys shall 28 be deposited in the special administration fund. In the absence of a specific 29 appropriation, the moneys in the special administration fund are perpetually 30 appropriated to the director and may be expended with the approval of the 31 advisory council appointed pursuant to section 72-1336, Idaho Code, for costs 32 related to programs administered by the department. The director shall report 33 annually to the joint finance-appropriations committee and the advisory coun- 34 cil the expenditures and disbursements made from the fund during the preceding 35 fiscal year, and the expenditures and disbursements and commitments made dur- 36 ing the current fiscal year to date. 37 (4) Administrative costs related to the reserve fund and the special 38 administration fund shall be paid from federal administrative grants received 39 under title III of the social security act, to the extent permitted by federal 40 law, and then from the special administration fund. 41 SECTION 2. An emergency existing therefor, which emergency is hereby 42 declared to exist, this act shall be in full force and effect on and after its 43 passage and approval, and retroactively to January 1, 2006.
STATEMENT OF PURPOSE RS15942 This bill removes one of the conditions that prohibit the deposit of 17 percent of employer unemployment insurance taxes into the state-invested Employment Security Reserve Fund for calendar year 2006. This does not increase the amount employers must pay under Idaho's Employment Security Law. It simply eliminates the requirement that the balance in the Employment Security Reserve Fund must not exceed 49 percent of the balance in Idaho's Washington, D.C., Trust Fund for money to be deposited into the Reserve Fund instead of the Washington, D.C., Trust Fund for calendar year 2006. Both the Reserve Fund and the Washington, D.C., Trust Fund are used to pay unemployment insurance benefits. But since the Reserve Fund is kept in Idaho and is invested by the State Treasurer, the interest earned on its investment is deposited in the Special Administration Fund and can be used to administer Department programs. The bill has an emergency clause so one of the conditions on the Reserve Fund can be removed retroactively to January 1, 2006. FISCAL NOTE There is no impact on the state General Fund. If enacted, the bill will allow the Department to keep 17 percent of the unemployment insurance taxes received in 2006 in the Reserve Fund in Idaho. That money would otherwise go to Idaho's Washington, D.C., Trust Fund. Interest earned on the Reserve Fund will increase revenue to the Special Administration Fund, which will be used to pay expenses incurred in the administration of the Department's programs, including the Commerce Division's share of indirect costs. Without this amendment, the Commerce Division's indirect costs would have to be paid from the state General Fund. CONTACT Name: Bob Fick Agency: Idaho Commerce & Labor Phone: 332-3570 ext. 3628; 409-9818 cell STATEMENT OF PURPOSE/FISCAL NOTE H 578