2001 Legislation
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SENATE BILL NO. 1019 – Employment security, tax wage rate


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Daily Data Tracking History

S1019.......................................by COMMERCE AND HUMAN RESOURCES
EMPLOYMENT SECURITY - Amends existing law relating to Employment Security
Law to provide the taxable wage rates for all covered experience-rated
employers for calendar year 2002.
01/17    Senate intro - 1st rdg - to printing
01/18    Rpt prt - to Com/HuRes
01/19    Rpt out - rec d/p - to 2nd rdg
01/22    2nd rdg - to 3rd rdg
01/25    3rd rdg - PASSED - 30-1-4
      AYES -- Boatright, Brandt, Bunderson, Burtenshaw, Cameron, Danielson,
      Darrington, Davis, Deide, Dunklin, Frasure, Goedde, Hawkins, Ingram,
      Keough, King-Barrutia, Lee, Lodge, Noh, Richardson, Riggs, Risch,
      Sandy, Schroeder, Sorensen, Stegner, Stennett, Thorne, Wheeler,
      NAYS -- Whitworth
      Absent and excused -- Andreason, Branch, Geddes, Ipsen
    Floor Sponsor - Stegner
    Title apvd - to House
01/26    House intro - 1st rdg - to Comm/HuRes
02/06    Rpt out - rec d/p - to 2nd rdg
02/07    2nd rdg - to 3rd rdg
02/12    3rd rdg - PASSED - 63-0-7
      AYES -- Barraclough, Bedke, Bell, Bieter, Boe, Bolz, Bradford,
      Bruneel, Campbell, Chase, Clark, Collins, Cuddy, Deal, Denney,
      Ellsworth, Eskridge, Field(13), Field(20), Gagner, Gould, Hadley,
      Hammond, Harwood, Henbest, Higgins, Hornbeck, Jaquet, Jones, Kendell,
      Kunz, Lake, Langford, Loertscher, Mader, Marley, McKague, Meyer,
      Montgomery, Mortensen, Moss, Moyle, Pearce, Pomeroy, Raybould,
      Ridinger, Roberts, Robison, Sali, Schaefer, Sellman, Shepherd, Smith,
      Smylie, Stevenson, Stone, Swan, Tilman, Trail, Wheeler, Wood, Young,
      Mr. Speaker
      NAYS -- None
      Absent and excused -- Barrett, Black, Callister, Crow Ellis, Kellogg,
    Floor Sponsor -- Swan
    Title apvd - to Senate
02/13    To enrol
02/14    Rpt enrol - Pres signed
02/15    Sp signed
02/16    To Governor
02/21    Governor signed
         Session Law Chapter 18
         Effective: 07/01/01

Bill Text

  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-sixth Legislature                  First Regular Session - 2001
                                       IN THE SENATE
                                    SENATE BILL NO. 1019
  1                                        AN ACT
  6    Be It Enacted by the Legislature of the State of Idaho:
  7        SECTION 1.  That Section 72-1350, Idaho Code, be, and the same  is  hereby
  8    amended to read as follows:
  9        72-1350.  TAXABLE  WAGE  BASE AND TAXABLE WAGE RATES. (1) All remuneration
 10    for personal services as defined in section 72-1328, Idaho Code, equal to  the
 11    average  annual  wage in covered employment for the penultimate calendar year,
 12    rounded to the nearest multiple of one hundred dollars ($100), or  the  amount
 13    of  taxable wage base specified in the federal unemployment tax act, whichever
 14    is higher, shall be the taxable wage base for purposes of this chapter.
 15        (2)  All covered employers, except those eligible and  electing  the  cost
 16    reimbursement payment method, shall be assigned taxable wage rates annually by
 17    the  director in accordance with the following, provided however, and notwith-
 18    standing any other provision of the employment security law to  the  contrary,
 19    for calendar year 2002 the taxable wage rates for all covered experience-rated
 20    employers shall be determined in accordance with schedule II.
 21        (3)  A  desired employment security fund size shall be determined for each
 22    calendar year by calculating from the penultimate  year,  the  ten  (10)  year
 23    average  of  annual benefits paid to wages covered, multiplied by one and one-
 24    half (1.5). The resulting ratio, when applied to  the  covered  wages  of  the
 25    penultimate  year, represents the desired fund size. This calculation is here-
 26    after referred to as the average cost multiple (ACM).
 27        (4)  The ACM shall be the ratio at the top of taxable wage rate schedule V
 28    as provided in subsection (7) of this section, and all other ratios for sched-
 29    ules I through IX are adjusted up or down from schedule V in equal  increments
 30    of .005.
 31        (5)  The taxable wage rate schedule for each calendar year shall be deter-
 32    mined  by comparing the ratio of the actual balance of the employment security
 33    fund, section 72-1346, Idaho Code, and the  reserve  fund,  section  72-1347A,
 34    Idaho  Code,  on  September  30,  to the wages covered in the penultimate year
 35    against the taxable wage schedule ratios as provided in subsection (4) of this
 36    section.
 37        (6)  The ratios computed for each taxable wage rate schedule  as  provided
 38    in  subsection  (4)  of  this  section  shall be placed with their appropriate
 39    schedule at the top of the columns as provided in subsection (7) of this  sec-
 40    tion,  and  shall  represent  the minimum fund level required for the specific
 41    schedule to be in effect.
  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.

Statement of Purpose / Fiscal Impact

                      STATEMENT  OF  PURPOSE
                            RS 10507
This bill will freeze the unemployment insurance taxable wage rates
at schedule II for calendar year 2002. If this bill is not enacted,
it is projected that rate schedule III will be effective in
calendar year 2002.

                         FISCAL  IMPACT
There is no impact on the State General Fund. Current law (rate
schedule III projected for 2002) would generate an estimated $119.8
million for calendar year 2002. This bill, which designates rate
schedule II for calendar year 2002, would generate an estimated
$105.0 million for the same calendar period. Thus, if enacted, this
bill would result in a tax savings to employers of approximately
$14.8 million. The funds impacted by this tax savings would be the
Unemployment Insurance (UI) Trust Fund, in the amount of $14.4
million, and the Workforce Development Training Fund, in the amount
of $0.4 million. The decrease in revenue to the UI Trust Fund is
projected to reduce interest on that fund by approximately $0.2

These fiscal impact projections were made under an assumption of
continued moderate growth in Idaho's economy. If there is a severe
recession, enactment of this legislation would make it more likely
that Idaho's UI Trust Fund would be depleted and the State would
have to borrow federal funds to continue paying UI benefits. In
addition, UI taxes may have to increase during the recession in
order to pay back the federal loans and restore Idaho's UI Trust
Fund.  The balance in the UI Trust Fund at the end of calendar year
1999 was $332.8 million.

Name:         Dwight Johnson
Agency:  Department of Labor
Phone:        334-6402

Statement of Purpose/Fiscal Note                              S101