View Daily Data Tracking History
View Bill Text
View Statement of Purpose / Fiscal Impact
H0041........................................................by MR. SPEAKER
Requested by Idaho Department of Labor
REED ACT MONEYS - Amends existing law to enact federal limitations for the
legal use of Reed Act moneys by the Department of Labor in administering
Idaho's unemployment insurance programs; and to make correct statutory
citations in the unemployment insurance law.
01/11 House intro - 1st rdg - to printing
01/11 Rpt prt - to Com/HuRes
01/26 Rpt out - rec d/p - to 2nd rdg
01/27 2nd rdg - to 3rd rdg
02/01 3rd rdg - PASSED - 67-0-2
AYES -- Alltus, Barraclough, Barrett, Bell, Black, Boe, Bruneel,
Callister, Campbell, Chase, Clark, Crow, Cuddy, Deal, Denney,
Ellsworth, Field(13), Field(20), Gagner, Geddes, Gould, Hadley,
Hammond, Hansen(23), Hansen(29), Henbest, Hornbeck, Jaquet, Jones,
Judd, Kellogg, Kempton, Kendell, Kjellander, Kunz, Lake, Limbaugh,
Linford, Loertscher, Mader, Marley, McKague, Meyer, Montgomery,
Mortensen, Moyle, Pischner, Pomeroy, Reynolds, Ridinger, Ringo,
Robison, Schaefer, Sellman, Smith, Stevenson, Stoicheff, Stone,
Taylor, Tilman, Tippets, Watson, Wheeler, Williams, Wood, Zimmermann,
Mr Speaker
NAYS -- None
Absent and excused -- Sali, Trail
Dist. 19, Seat A, Vacant
Floor Sponsor - Marley
Title apvd - to Senate
02/02 Senate intro - 1st rdg - to Com/HuRes
03/05 Rpt out - rec d/p - to 2nd rdg
03/08 2nd rdg - to 3rd rdg
03/10 3rd rdg - PASSED - 31-0-4
AYES--Andreason, Boatright, Branch, Bunderson, Cameron, Crow,
Danielson, Darrington, Davis, Deide, Dunklin, Frasure, Geddes,
Hawkins, Ingram, Ipsen, Keough, King, Lee, McLaughlin, Richardson,
Riggs, Risch, Sandy, Schroeder, Sorensen, Stegner, Stennett, Thorne,
Wheeler, Whitworth
NAYS--None
Absent and excused--Burtenshaw, Noh, Parry, Twiggs
Floor Sponsor - McLaughlin
Title apvd - to House
03/11 To enrol
03/12 Rpt enrol - Sp signed
03/15 Pres signed
03/16 To Governor
03/18 Governor signed
Session Law Chapter 101
Effective: 07/01/99
H0041|||| LEGISLATURE OF THE STATE OF IDAHO |||| Fifty-fifth Legislature First Regular Session - 1999IN THE HOUSE OF REPRESENTATIVES HOUSE BILL NO. 41 BY MR. SPEAKER Requested by: Department of Labor 1 AN ACT 2 RELATING TO THE EMPLOYMENT SECURITY LAW; AMENDING SECTION 72-1346, IDAHO CODE, 3 TO PROVIDE THAT REED ACT MONEYS CREDITED WITH RESPECT TO FEDERAL FISCAL 4 YEARS 1999, 2000 AND 2001 SHALL BE USED SOLELY FOR THE ADMINISTRATION OF 5 THE UNEMPLOYMENT INSURANCE PROGRAM AND ARE NOT SUBJECT TO APPROPRIATION; 6 AMENDING SECTION 72-1350, IDAHO CODE, TO PROVIDE TAXABLE WAGE RATES FOR 7 DEFICIT EMPLOYERS IN RATE CLASS 3 UNDER SCHEDULES VIII AND IX; AND AMEND- 8 ING SECTION 72-1369, IDAHO CODE, TO PROVIDE CORRECT STATUTORY CITATIONS. 9 Be It Enacted by the Legislature of the State of Idaho: 10 SECTION 1. That Section 72-1346, Idaho Code, be, and the same is hereby 11 amended to read as follows: 12 72-1346. EMPLOYMENT SECURITY FUND. (1) Establishment and Control. There 13 is established in the state treasury, separate and apart from all other funds 14 of this state, an "Employment Security Fund," which shall be perpetually 15 appropriated to the director to be administered pursuant to the provisions of 16 this chapter and the social security act. This fund shall consist of all con- 17 tributions collected pursuant to this chapter, payments in lieu of contribu- 18 tions, interest earned upon any moneys in the fund, any property or securities 19 acquired through the use of moneys belonging to the fund, all earnings of such 20 property or securities, moneys temporarily deposited in the clearing account, 21 and all other moneys received for the fund from any other source. 22 (2) Accounts and Deposits. The state controller shall maintain within the 23 fund three (3) separate accounts: (i) a clearing account, (ii) an unemployment 24 trust fund account, and (iii) a benefit account. Upon receipt by the director, 25 all moneys payable to the fund shall be promptly forwarded to the state trea- 26 surer for immediate deposit in the clearing account. After clearance, all 27 moneys in the clearing account shall, except as otherwise provided, be depos- 28 ited promptly with the secretary of the treasury of the United States to the 29 credit of this state's account in the unemployment trust fund established and 30 maintained pursuant to section 904 of the social security act (42 U.S.C. 31 1104), any provisions of law in this state to the contrary notwithstanding. 32 The benefit account shall consist of all moneys requisitioned for the payment 33 of benefits from this state's account in the unemployment trust fund in the 34 treasury of the United States. Moneys in the clearing and benefit accounts may 35 be deposited by the state treasurer under the direction of the director in any 36 depository bank in which general funds of the state may be deposited, but no 37 public deposit insurance charge or premium shall be paid out of the fund. 38 Moneys in the clearing and benefit accounts shall not be commingled with other 39 state funds and shall be maintained in separate accounts on the books of the 40 depository bank. Such moneys shall be secured by the depository bank in the 41 same manner as required by the general public depository law of this state and 42 collateral pledged for this purpose shall be kept separate and distinct from 43 collateral pledged to secure other funds of the state. The state treasurer 2 1 shall be liable on his official bond for the faithful performance of his 2 duties in connection with the employment security fund. 3 (3) Withdrawals. Moneys requisitioned by the director through the trea- 4 surer from this state's account in the unemployment trust fund shall be used 5 exclusively for the payment of benefits and for refunds pursuant to section 6 72-1357, Idaho Code, except that Reed act moneys credited to this state's 7 account pursuant to section 903 of the social security act (42 U.S.C. 1103), 8 shall be used exclusively as provided in subsection (4) of this section. The 9 director through the treasurer shall requisition from the unemployment trust 10 fund such amounts, not exceeding the amounts standing to this state's account 11 therein, as he deems necessary for the payment of benefits and refunds for a 12 reasonable period. Upon receipt, such moneys shall be deposited in the benefit 13 account. Expenditures of moneys in the benefit and clearing accounts shall not 14 require the approval of the board of examiners or be subject to any provisions 15 of law requiring specific appropriations or other formal release by state 16 officers of money in their custody. The residual daily balance in the benefit 17 account may be invested in accordance with the cash management improvement act 18 of 1990, and earnings on those investments may be used to pay the related 19 banking costs of maintaining the benefit account. Any earnings in excess of 20 the related banking costs shall be returned to the state's account in the fed- 21 eral unemployment trust fund annually. All warrants issued for the payment of 22 benefits and refunds shall bear the signature of the director. Upon agreement 23 between the director and state controller, amounts in the benefit account may 24 be transferred to a revolving account established and maintained in a deposi- 25 tory bank from which the director may issue checks for the payment of benefits 26 and refunds. Moneys so transferred shall be deposited subject to the same 27 requirements as provided with respect to moneys in the clearing and benefit 28 accounts in subsection (2) of this section. Any balance of moneys requisi- 29 tioned from the unemployment trust fund which remains unclaimed or unpaid in 30 the benefit account or revolving account after the expiration of the period 31 for which such sums were requisitioned, may be utilized for the payment of 32 benefits and refunds during succeeding periods, or, in the discretion of the 33 director, shall be redeposited with the secretary of the treasury of the 34 United States to the credit of this state's account in the unemployment trust 35 fund. 36 (4) Reed act moneys. Reed act moneys credited to this state's account in 37 the unemployment trust fund by the secretary of the treasury of the United 38 States pursuant to section 903 of the social security act (42 U.S.C. 1103), 39 may be requisitioned and used for the payment of benefits and for the payment 40 of expenses incurred for the administration of this chapter. Moneys may only 41 be requisitioned and used for the payment of expenses incurred for the admin- 42 istration of this chapter if the expenses are incurred and the money is requi- 43 sitioned after the enactment of a specific appropriation by the legislature 44 which specifies the purposes for which such money is appropriated, the amounts 45 appropriated therefor, and provides that: 46 (a) Such money may not be obligated after the close of the two (2) year 47 period which began on the date of the enactment of the appropriation law; 48 and 49 (b) The amount which may be obligated at any time may not exceed the 50 amount by which the aggregate of the amounts transferred to the account of 51 this state pursuant to section 903 of the social security act (42 U.S.C. 52 1103), exceeds the aggregate of the amounts used by this state and charged 53 against the amounts transferred to the account of this state. For the pur- 54 poses of this subsection, amounts obligated for administrative purposes 55 pursuant to an appropriation shall be chargeable against transferred 3 1 amounts at the exact time the obligation is entered into. 2 (c) Reed act moneys requisitioned for the payment of benefits shall be 3 deposited in the benefit account established in this section. Reed act 4 moneys requisitioned for the payment of administrative expenses pursuant 5 to a specific appropriation shall be deposited in the employment security 6 administration fund, section 72-1347, Idaho Code, except that moneys 7 appropriated for the purchase of lands and buildings shall be deposited in 8 the state employment security administrative and reimbursement fund in 9 accordance with section 72-1348, Idaho Code. Money so deposited shall, 10 until expended, remain part of the employment security fund and, if not 11 expended, shall be promptly returned to this state's account in the unem- 12 ployment trust fund. 13 (d) Notwithstanding paragraphs (a), (b) and (c) of this subsection, 14 Reed act moneys credited with respect to federal fiscal years 1999, 2000 15 and 2001 shall be used solely for the administration of the unemployment 16 insurance program and are not subject to appropriation by the legislature. 17 18 SECTION 2. That Section 72-1350, Idaho Code, be, and the same is hereby 19 amended to read as follows: 20 72-1350. TAXABLE WAGE BASE AND TAXABLE WAGE RATES. (1) All remuneration 21 for personal services as defined in section 72-1328, Idaho Code, equal to the 22 average annual wage in covered employment for the penultimate calendar year, 23 rounded to the nearest multiple of one hundred dollars ($100), or the amount 24 of taxable wage base specified in the federal unemployment tax act, whichever 25 is higher, shall be the taxable wage base for purposes of this chapter. 26 (2) All covered employers, except those eligible and electing the cost 27 reimbursement payment method, shall be assigned taxable wage rates annually by 28 the director in accordance with the following. 29 (3) A desired employment security fund size shall be determined for each 30 calendar year by calculating from the penultimate year, the ten (10) year 31 average of annual benefits paid to wages covered, multiplied by one and one- 32 half (1.5). The resulting ratio, when applied to the covered wages of the 33 penultimate year, represents the desired fund size. This calculation is here- 34 after referred to as the average cost multiple (ACM). 35 (4) The ACM shall be the ratio at the top of taxable wage rate schedule V 36 as provided in subsection (7) of this section, and all other ratios for sched- 37 ules I through IX are adjusted up or down from schedule V in equal increments 38 of .005. 39 (5) The taxable wage rate schedule for each calendar year shall be deter- 40 mined by comparing the ratio of the actual balance of the employment security 41 fund, section 72-1346, Idaho Code, and the reserve fund, section 72-1347A, 42 Idaho Code, on September 30, to the wages covered in the penultimate year 43 against the taxable wage schedule ratios as provided in subsection (4) of this 44 section. 45 (6) The ratios computed for each taxable wage rate schedule as provided 46 in subsection (4) of this section shall be placed with their appropriate 47 schedule at the top of the columns as provided in subsection (7) of this sec- 48 tion, and shall represent the minimum fund level required for the specific 49 schedule to be in effect. 4 5 1 (8) Each employer will be assigned a taxable wage rate from the effective 2 taxable wage rate schedule for eligible, standard-rated and deficit employers, 3 based upon the employer's experience as determined under the provisions of 4 sections 72-1319, 72-1319A, 72-1319B and 72-1351, Idaho Code. 5 (a) Deficit employers who have been assigned a taxable wage rate from 6 rate class six will be assigned contribution rates equal to their taxable 7 wage rate. 8 (b) All other eligible, standard-rated and deficit employers will be 9 assigned contribution rates equal to ninety-seven percent (97%) of their 10 taxable wage rate. Provided however, that for each calendar year a reserve 11 tax is imposed pursuant to section 72-1347A, Idaho Code, the contribution 12 rates for employers assigned contribution rates pursuant to this paragraph 13 shall be eighty percent (80%) of their taxable wage rate. 14 (9) Each employer shall be notified of his taxable wage rate as deter- 15 mined for any calendar year pursuant to this section and section 72-1351, 16 Idaho Code. Such determination shall become conclusive and binding upon the 17 employer, unless within fourteen (14) days after delivery or mailing of the 18 notice thereof to his last known address, the employer files an application 19 for redetermination, setting forth his reasons therefor. Reconsideration shall 20 be limited to transactions occurring subsequent to any previous determination 21 which has become final. The employer shall be promptly notified of the rede- 22 termination, which shall become final unless an appeal is filed within four- 23 teen (14) days after delivery or mailing of notice to his last known address. 24 Proceedings on the appeal shall be in accordance with the provisions of sec- 25 tion 72-1361, Idaho Code. 26 SECTION 3. That Section 72-1369, Idaho Code, be, and the same is hereby 27 amended to read as follows: 28 72-1369. OVERPAYMENTS, COLLECTION AND WAIVER. (1) Any person who received 29 benefits to which he was not entitled under the provisions of this chapter or 30 under an unemployment insurance law of any state or of the federal government 31 shall be liable to repay the benefits and the benefits shall, for the purpose 32 of this chapter, be considered to be overpayments. Overpayments shall be 33 repaid as follows: 34 (a) Any overpayment which has not been repaid may, in addition to or 35 alternatively to any other method of collection prescribed in this chap- 36 ter, including the creation of a lien as provided by section 72-1360, 37 Idaho Code, be collected with interest thereon at the statutory rate by 38 civil action brought in the name of the state of Idaho. In bringing such 39 civil actions for the collection of overpayments, the director shall have 40 all the rights and remedies provided by the laws of this state, and any 41 person adjudged liable in such civil action for any overpayments shall pay 42 the costs of such action. Such civil actions may be commenced within the 43 time periods specified in this section without regard to any other statute 44 of limitations. 45 (b) Collection of overpayments. 46 (i) Overpayments, other than those resulting from a false state- 47 ment, misrepresentation, or failure to report a material fact by the 48 claimant, which have not been repaid or collected, may, at the dis- 49 cretion of the director be deducted from any future benefits payable 50 to the claimant under the provisions of this chapter; 51 (ii) Overpayments resulting from a false statement, misrepresenta- 52 tion, or concealment of a material fact by the claimant which have 53 not been repaid or collected shall be deducted from any benefits pay- 6 1 able at any time in the future, without regard to any statute of lim- 2 itation and such overpayments not recovered within eight (8) years 3 from the date of the final determination establishing liability to 4 repay may be deemed uncollectible; 5 (iii) A civil action, filed pursuant tosubsection6 paragraph (1a ) of this sub 7 section, to collect overpayments resulting from a false state- 8 ment, misrepresentation, or concealment of a material fact by the 9 claimant must be commenced within eight (8) years from the date of 10 the final determination establishing liability to repay; 11 (c) Overpayments, other than those resulting from a false statement, mis- 12 representation or failure to report a material fact, not recovered within 13 five (5) years from the date of the final determination establishing lia- 14 bility to repay shall be deemed uncollectible, and a civil action filed 15 pursuant tosubsectionparagraph (116a ) of this sub section, to collect such 17 overpayments must be commenced within the same five (5) year time period; 18 (d) The director may waive the requirement to repay an overpayment 19 described insubsectionparagraph (320c ) of this sub section if the benefit pay- 21 ments were made solely as a result of department error or inadvertence, 22 and made to a claimant who had no way of knowing that he was receiving 23 benefits to which he was not entitled or if such payments were made solely 24 as a result of an employer misreporting wages earned in a claimant's base 25 period, and made to a claimant who could not reasonably have been expected 26 to recognize an error in the wages reported. 27 (e) Any judgment obtained pursuant to this section shall, upon compliance 28 with the requirements of chapter 19, title 45, Idaho Code, become a lien 29 of the same type, duration, and priority as if it were created pursuant to 30 section 72-1360, Idaho Code. 31 (2) Neither the director nor any of his agents or employees shall be lia- 32 ble for benefits paid to persons not entitled to the same under the provisions 33 of this chapter if it appears that such payments have been made in good faith 34 and that ordinary care and diligence have been used in the determination of 35 the validity of the claim or claims under which such benefits have been paid.
STATEMENT OF PURPOSE
RS08450
This bill contains three amendments to Idaho's Employment Security
Law.
The amendment to Section 72-1346, Idaho Code, concerns "Reed Act" moneys.
The term "Reed Act" refers to a section of the Employment Security
Financing Act of 1954 which provides that, under certain conditions, the
U.S. Department of Labor will transfer excess funds in the federal
Employment Security Administration Account to state accounts in the
Unemployment Trust Fund. Federal law generally allows the states to use
Reed Act moneys for the payment of unemployment insurance benefits and
for the administration of the Unemployment Insurance Program and public
employment offices. Section 5403 of the federal Balanced Budget Act of
1997 provides for a special distribution of Reed Act moneys to the states
in federal Fiscal Year 1999, 2000 and 2001 and limits the use of these
funds to the administration of the Unemployment Insurance Program as
defined in federal Unemployment Insurance Program Letter No. 44-97. The
federal Act also provides that the restrictions applicable to past
distributions of Reed Act moneys are not applicable to these funds,
including the requirement that the funds be appropriated by the state
legislature. In order to use this special distribution of Reed Act
moneys, Idaho must enact the federal limitations on the use of these
funds. The amendment to Section 72-1346 will satisfy this requirement.
The amendment to Section 72-1350, Idaho Code, provides taxable wage rates
for deficit employers in rate class 3 under schedules VIII and IX. These
two taxable wage rates are not in the schedules because they were
simultaneously underscored and overstruck by mistake in House Bill 426
which was enacted during the 1998 legislative session.
The amendment to Section 72-1369, Idaho Code, corrects erroneous
statutory citations.
FISCAL IMPACT
Without the amendment to Section 72-1346, Idaho Code, the Idaho
Department of Labor will not be able to use federal Reed Act moneys in
the amount of approximately $350,000 per year in federal Fiscal Years
1999, 2000 and 2001.
The other two amendments correct clerical errors and have no fiscal
impact.
CONTACT
Name: Dwight Johnson
Agency: Department of Labor
Phone: 334-6402
Statement of Purpose/Fiscal Impact H 4