2005 Legislation
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HOUSE BILL NO. 4 – Unemployment insurance, tax rates

HOUSE BILL NO. 4

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Bill Status



H0004.......................................by COMMERCE AND HUMAN RESOURCES
UNEMPLOYMENT INSURANCE - Amends and adds to existing law relating to
unemployment insurance tax rates to revise definitions; to require covered
employers to submit a business registration form; to provide an exception
to imposition of the reserve tax; to revise requirements for the Special
Administration Fund; to provide for disbursement of any unencumbered
balance in the Workforce Development Training Fund exceeding six million
dollars; to revise the method for determining taxable wage rates; to
provide finality of determinations of chargeability; to provide liability
for amounts due from transferred experience rating accounts; to revise the
penalty on unpaid amounts; to provide for the collection of jeopardy
assessment amounts due; to revise the rate of interest on liens; to revise
the personal eligibility conditions for benefits; to revise the method for
determining the maximum weekly benefit amount; to revise the number of
weeks of benefit entitlement; to provide that severance pay is deductible
income; to provide civil penalties on overpayments resulting from false
statements, misrepresentation or failure to report a material fact; to
revise the methods of collection; to revise the criteria for waiver of
overpayments; and to provide civil penalties for employers.
                                                                        
01/14    House intro - 1st rdg - to printing
01/17    Rpt prt - to Com/HuRes
01/18    Rpt out - rec d/p - to 2nd rdg
01/19    2nd rdg - to 3rd rdg
01/20    3rd rdg - PASSED - 65-0-5
      AYES -- Anderson, Andrus, Barraclough, Barrett, Bastian, Bedke, Bell,
      Bilbao, Black, Block, Bolz, Bradford, Cannon, Chadderdon, Clark,
      Collins, Crow, Deal, Denney, Edmunson, Ellsworth, Eskridge,
      Field(18), Field(23), Garrett, Hart, Harwood, Henderson, Jaquet,
      Kemp, Lake, LeFavour, Loertscher, Martinez, Mathews, McGeachin,
      McKague, Miller, Mitchell, Moyle, Nielsen, Nonini, Pasley-Stuart,
      Pence, Raybould, Ring, Ringo, Roberts, Rusche, Rydalch, Sali, Sayler,
      Schaefer, Shepherd(2), Shepherd(8), Shirley, Skippen, Smith(30),
      Smith(24), Smylie, Snodgrass, Stevenson, Trail, Wills, Wood
      NAYS -- None
      Absent and excused -- Bayer, Boe, Henbest, Jones, Mr. Speaker
    Floor Sponsors- Pasley-Stuart & Lake
    Title apvd - to Senate
01/21    Senate intro - 1st rdg - 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 - 35-0-0
      AYES -- Andreason, Brandt, Broadsword, Bunderson, Burkett,
      Burtenshaw, Cameron, Coiner, Compton, Corder, Darrington, Davis,
      Gannon, Geddes, Goedde, Hill, Jorgenson, Kelly, Keough, Langhorst,
      Little, Lodge, Malepeai, Marley, McGee, McKenzie, Noble, Pearce,
      Richardson, Schroeder, Stegner, Stennett, Sweet, Werk,
      Williams(Williams)
      NAYS -- None
      Absent and excused -- None
    Floor Sponsors - Andreason, Goedde & Malepeai
    Title apvd - to House
02/02    To enrol
02/03    Rpt enrol - Sp signed
02/04    Pres signed
02/07    To Governor
02/07    Governor signed
         Session Law Chapter 5
         Effective: 01/01/05 Secs 3, 7, 8 & 9;
         07/01/05 All other sections

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-eighth Legislature                   First Regular Session - 2005
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                      HOUSE BILL NO. 4
                                                                        
                         BY COMMERCE AND HUMAN RESOURCES COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO THE EMPLOYMENT SECURITY LAW; AMENDING SECTION 23-950, IDAHO  CODE,
  3        TO  RESTRICT  THE  TRANSFER OF A LIQUOR LICENSE AND TO PROVIDE FOR SEIZURE
  4        FOR AMOUNTS DUE; AMENDING SECTION 72-1316A, IDAHO CODE, TO  EXEMPT  CASUAL
  5        EMPLOYMENT  AND  TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION 72-1319B,
  6        IDAHO CODE, TO REVISE THE DEFINITION OF TAXABLE WAGE RATE;  AMENDING  SEC-
  7        TION  72-1337,  IDAHO CODE, TO REQUIRE COVERED EMPLOYERS TO SUBMIT A BUSI-
  8        NESS REGISTRATION FORM; AMENDING SECTION 72-1347A, IDAHO CODE, TO  PROVIDE
  9        AN  EXCEPTION TO IMPOSITION OF THE RESERVE TAX, TO REVISE REQUIREMENTS FOR
 10        THE SPECIAL ADMINISTRATION FUND AND TO PROVIDE CORRECT TERMINOLOGY; AMEND-
 11        ING SECTION 72-1347B, IDAHO CODE, TO PROVIDE FOR DISBURSEMENT OF ANY UNEN-
 12        CUMBERED BALANCE IN THE WORKFORCE DEVELOPMENT TRAINING FUND EXCEEDING  SIX
 13        MILLION DOLLARS; AMENDING SECTION 72-1349, IDAHO CODE, TO MAKE A TECHNICAL
 14        CORRECTION; AMENDING SECTION 72-1350, IDAHO CODE, TO REVISE THE METHOD FOR
 15        DETERMINING  TAXABLE  WAGE RATES AND TO DELETE OBSOLETE LANGUAGE; AMENDING
 16        SECTION 72-1351, IDAHO CODE, TO PROVIDE FOR FINALITY OF DETERMINATIONS  OF
 17        CHARGEABILITY, TO PROVIDE LIABILITY FOR AMOUNTS DUE FROM TRANSFERRED EXPE-
 18        RIENCE RATING ACCOUNTS AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION
 19        72-1354,  IDAHO  CODE,  TO  REVISE THE PENALTY ON UNPAID AMOUNTS; AMENDING
 20        SECTION 72-1359, IDAHO CODE, TO PROVIDE FOR  THE  COLLECTION  OF  JEOPARDY
 21        ASSESSMENT  AMOUNTS  DUE; AMENDING SECTION  72-1360, IDAHO CODE, TO REVISE
 22        THE RATE OF INTEREST ON LIENS; AMENDING SECTION 72-1366,  IDAHO  CODE,  TO
 23        REVISE  THE PERSONAL ELIGIBILITY CONDITIONS FOR BENEFITS AND TO MAKE TECH-
 24        NICAL CORRECTIONS; AMENDING SECTION 72-1367, IDAHO  CODE,  TO  REVISE  THE
 25        METHOD  FOR  DETERMINING  THE MAXIMUM WEEKLY BENEFIT AMOUNT, TO REVISE THE
 26        NUMBER OF WEEKS OF BENEFIT ENTITLEMENT AND TO PROVIDE THAT  SEVERANCE  PAY
 27        IS  DEDUCTIBLE  INCOME;  AMENDING  SECTION 72-1369, IDAHO CODE, TO PROVIDE
 28        CIVIL PENALTIES ON OVERPAYMENTS RESULTING FROM FALSE STATEMENTS, MISREPRE-
 29        SENTATION OR FAILURE TO REPORT A MATERIAL FACT, TO REVISE THE  METHODS  OF
 30        COLLECTION AND TO REVISE THE CRITERIA FOR WAIVER OF OVERPAYMENTS; AMENDING
 31        CHAPTER  13,  TITLE  72,  IDAHO  CODE,  BY  THE  ADDITION OF A NEW SECTION
 32        72-1372, IDAHO CODE, TO PROVIDE CIVIL PENALTIES FOR  EMPLOYERS;  DECLARING
 33        AN  EMERGENCY  AND  PROVIDING RETROACTIVE APPLICATION FOR SECTIONS 3, 7, 8
 34        AND 9 OF THIS ACT; AND PROVIDING AN EFFECTIVE DATE FOR SECTIONS 1,  2,  4,
 35        5, 6, 10, 11, 12, 13, 14, 15 AND 16 OF THIS ACT.
                                                                        
 36    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 37        SECTION  1.  That  Section  23-950, Idaho Code, be, and the same is hereby
 38    amended to read as follows:
                                                                        
 39        23-950.  RESTRICTION AGAINST TRANSFER OF LICENSE. (1)  No  license  issued
 40    under  the provisions of this chapter shall be renewed, transferred, assigned,
 41    leased or sold if:
 42        (a)  Tthe state tax commission has notified the director and the  licensee
 43        in  writing  that  any  tax imposed by chapters 30 and 36, title 63, Idaho
                                                                        
                                           2
                                                                        
  1        Code, interest, penalty, and additional amount, which  has  accrued  as  a
  2        result of the operation of the licensed premises has been assessed as that
  3        term  is  defined in section 63-3045A, Idaho Code, against the licensee or
  4        any person operating the licensed premises  with  the  permission  of  the
  5        licensee.; or
  6        (b)  The  department  of  commerce and labor has notified the director and
  7        the licensee in writing that a lien has been filed against the licensee or
  8        any person operating the licensed premises  with  the  permission  of  the
  9        licensee,  as  a result of the operation of the licensed premises securing
 10        amounts due pursuant to chapter 13, title 72, Idaho Code.
 11        (2)  At such time as the state tax commission or the  department  of  com-
 12    merce and labor has notified the director and licensee as herein provided, the
 13    license  issued  for  the  premises the operation of which has resulted in the
 14    accrual of the tax for which the warrant or lien is outstanding shall be  sub-
 15    ject  to  levy  and distraint pursuant to chapter 30, title 63, Idaho Code, or
 16    seizure pursuant to section 72-1360A, Idaho Code.
                                                                        
 17        SECTION 2.  That Section 72-1316A, Idaho Code, be, and the same is  hereby
 18    amended to read as follows:
                                                                        
 19        72-1316A.  EXEMPT EMPLOYMENT. "Exempt employment" means service performed:
 20        (1)  By an individual in the employ of his spouse or child.
 21        (2)  By  a  person under the age of twenty-one (21) years in the employ of
 22    his father or mother.
 23        (3)  By an individual under the  age  of  twenty-two  (22)  years  who  is
 24    enrolled  as  a  student  in a full-time program at an accredited nonprofit or
 25    public education institution for which credit at such institution is earned in
 26    a program which combines academic instruction with work experience. This  sub-
 27    paragraph  subsection shall not apply to service performed in a program estab-
 28    lished at the request of an employer or group of employers.
 29        (4)  In the employ of the United States government or  an  instrumentality
 30    of  the  United States exempt under the constitution of the United States from
 31    the contributions imposed by this chapter.
 32        (5)  In the employ of a governmental entity in the exercise of duties:
 33        (a)  As an elected official;
 34        (b)  As a member of a legislative body, or a member of the judiciary, of a
 35        state or political subdivision thereof;
 36        (c)  As a member of the state national guard or air national guard;
 37        (d)  As an employee serving on a temporary basis in case of  fire,  storm,
 38        snow, earthquake, flood, or similar emergency; or
 39        (e)  In  a  position  which, pursuant to the laws of this state, is desig-
 40        nated as (i) a major nontenured policy  making  policymaking  or  advisory
 41        position,  or (ii) a policy making policymaking or advisory position which
 42        ordinarily does not require more than eight (8) hours per week.
 43        (6)  By an inmate of a correctional, custodial or  penal  institution,  if
 44    such services are performed for or within such institution.
 45        (7)  In the employ of:
 46        (a)  A church or convention or association of churches; or
 47        (b)  An  organization  which  is operated primarily for religious purposes
 48        and which is operated, supervised, controlled, or principally supported by
 49        a church, or convention or association of churches; or
 50        (c)  In the employ of an institution of higher education, if it is devoted
 51        primarily to preparation of a student for the ministry or training  candi-
 52        dates to become members of a religious order; or
 53        (d)  By a duly ordained, commissioned, or licensed minister of a church in
                                                                        
                                           3
                                                                        
  1        the  exercise  of  his ministry or by a member of a religious order in the
  2        exercise of duties required by such order.
  3        (8)  By a program participant in a facility that  provides  rehabilitation
  4    for  individuals whose earning capacity is impaired by age, physical or mental
  5    deficiency, or injury or  provides  remunerative  work  for  individuals  who,
  6    because  of  their  impaired  physical  or  mental capacity, cannot be readily
  7    absorbed into the labor market.
  8        (9)  As part of an unemployment work relief program or as part of an unem-
  9    ployment work training program assisted or financed in whole or in part by any
 10    federal agency or an agency of a state or political subdivision thereof, by an
 11    individual receiving such work relief or work training.
 12        (10) Service with respect to which unemployment insurance is payable under
 13    an unemployment insurance system established by an act of congress other  than
 14    the social security act.
 15        (11) As  a  student  nurse in the employ of a hospital or nurses' training
 16    school by an individual who is enrolled and is regularly attending courses  in
 17    a  nurses'  training  school  approved pursuant to state law, and service per-
 18    formed as an intern in the employ of a hospital by an individual who has  com-
 19    pleted a course in a medical school approved pursuant to state law.
 20        (12) By  an  individual under the age of eighteen (18) years of age in the
 21    delivery or distribution of newspapers or shopping news not including delivery
 22    or distribution to any point for subsequent delivery or distribution.
 23        (13) By an individual for a person as an insurance agent or as  an  insur-
 24    ance solicitor, if all such service performed by such individual for such per-
 25    son is performed for remuneration solely by way of commission.
 26        (14) By an individual for a real estate broker as an associate real estate
 27    broker  or  as  a  real estate salesman, if all such service performed by such
 28    individual for such person is performed for remuneration solely by way of com-
 29    mission.
 30        (15) Service covered by an election approved by the  agency  charged  with
 31    the  administration  of any other state or federal unemployment insurance law,
 32    in accordance with an arrangement pursuant to section 72-1344, Idaho Code.
 33        (16) In the employ of a school or college by a student who is enrolled and
 34    regularly attending classes at such school or college.
 35        (17) In the employ of a hospital by a resident patient of such hospital.
 36        (18) By a member of an AmeriCorps program.
 37        (19) By an individual who is paid less than  fifty  dollars  ($50.00)  per
 38    calendar  quarter  for  performing  work  that  is  not  in  the course of the
 39    employer's trade or business, and  who  is  not  regularly  employed  by  such
 40    employer  to  perform  such  service.  For the purposes of this subsection, an
 41    individual shall be deemed to be regularly employed by an  employer  during  a
 42    calendar quarter only if:
 43        (a)  On  each of some twenty-four (24) days during such quarter such indi-
 44        vidual performs for such employer for some portion of the day service  not
 45        in the course of the employer's trade or business; or
 46        (b)  Such  individual  was so employed by such employer in the performance
 47        of such service during the preceding calendar quarter.
                                                                        
 48        SECTION 3.  That Section 72-1319B, Idaho Code, be, and the same is  hereby
 49    amended to read as follows:
                                                                        
 50        72-1319B.  TAXABLE  WAGE  RATE.  "Taxable  wage  rate" means the numerical
 51    values provided calculated in accordance with section 72-1350(7), Idaho  Code,
 52    for  the  purpose  of  establishing contribution rates, training tax rates and
 53    reserve tax rates for covered employers.
                                                                        
                                           4
                                                                        
  1        SECTION 4.  That Section 72-1337, Idaho Code, be, and the same  is  hereby
  2    amended to read as follows:
                                                                        
  3        72-1337.  RECORDS  AND  REPORTS.  (1)  Each  employer  that  is a "covered
  4    employer," as defined in section 72-1315, Idaho Code, shall complete and  sub-
  5    mit  to the director an Idaho business registration form within six (6) months
  6    of becoming a covered employer.
  7        (2)  Each employer shall keep accurate records, for such periods  of  time
  8    and  containing  such  information as the director may prescribe. Such records
  9    shall be open to inspection and be subject to being copied by the director  at
 10    any  reasonable  time.  The director, a member of the commission or an appeals
 11    examiner may require from any employer any sworn or unsworn reports which  are
 12    deemed necessary in the exercise of their duties.
                                                                        
 13        SECTION  5.  That Section 72-1347A, Idaho Code, be, and the same is hereby
 14    amended to read as follows:
                                                                        
 15        72-1347A.  EMPLOYMENT SECURITY  RESERVE  FUND  --  SPECIAL  ADMINISTRATION
 16    FUND.  (1)  There  is  established in the state treasury a special trust fund,
 17    separate and apart from all other public funds of this state, to be  known  as
 18    the  employment  security  reserve fund, hereinafter "reserve fund." Except as
 19    provided herein, all proceeds from the reserve tax defined in  subsection  (2)
 20    of this section shall be paid into the reserve fund. The moneys in the reserve
 21    fund  may  be  used by the director for loans to the employment security fund,
 22    section 72-1346, Idaho Code, as security for loans from the federal  unemploy-
 23    ment  insurance  trust  fund,  and  for  the repayment of any interest bearing
 24    advances, including interest, made under title XII of the social security act,
 25    42 USC 1321 through 1324, and shall be available to the director for  expendi-
 26    ture  in  accordance  with the provisions of this section. The state treasurer
 27    shall be the custodian of the reserve fund and shall  invest  said  moneys  in
 28    accordance  with  law.  The state treasurer shall disburse the moneys from the
 29    reserve fund in accordance with the directions of the director.
 30        (2)  A reserve tax is imposed on all covered  employers  required  to  pay
 31    contributions  pursuant to section 72-1350, Idaho Code, except deficit employ-
 32    ers who have been assigned a taxable wage rate from  deficit  rate  class  six
 33    pursuant  to  section  72-1350(8)(a), Idaho Code. The reserve tax shall be due
 34    and payable at the same time and in the same manner as contributions.  If  the
 35    reserve  fund  is  less  than  one  percent (1%) of state taxable wages in the
 36    penultimate year as of September  30  of  the  preceding  calendar  year,  the
 37    reserve  tax rate for all eligible, standard-rated and deficit employers shall
 38    be equal to the taxable wage rate then in effect less the  assigned  contribu-
 39    tion rate and training tax rate. The provisions of this chapter which apply to
 40    the payment and collection of contributions also apply to the payment and col-
 41    lection  of  the  reserve  tax,  including the same calculations, assessments,
 42    method of payment, penalties, interest, costs, liens, injunctive relief,  col-
 43    lection  procedures and refund procedures. In the administration of the provi-
 44    sions of this section and the collection of the reserve tax, the director   is
 45    granted all rights, authority, and prerogatives granted the director under the
 46    provisions  of  this  chapter. Moneys collected from an employer delinquent in
 47    paying contributions and reserve taxes shall first be applied to pay any  pen-
 48    alty and interest imposed pursuant to the provisions of this chapter and shall
 49    then  be  applied  pro  rata to pay delinquent contributions to the employment
 50    security fund, section 72-1346, Idaho Code, and delinquent  reserve  taxes  to
 51    the  reserve  fund  pursuant  to this section. Any interest and penalties col-
 52    lected pursuant to this subsection shall be paid  into  the  state  employment
                                                                        
                                           5
                                                                        
  1    security  administrative  and reimbursement fund, section 72-1348, Idaho Code,
  2    and any interest or penalties refunded under this subsection shall be paid out
  3    of that same fund. Reserve taxes paid pursuant to this subsection may  not  be
  4    deducted  in whole or in part by any employer from the wages of individuals in
  5    its employ. All reserve taxes collected pursuant to this subsection  shall  be
  6    deposited  in  the  clearing  account of the employment security fund, section
  7    72-1346, Idaho Code, for clearance only and shall  not  become  part  of  such
  8    fund.  After  clearance,  the  moneys  shall  be deposited in the reserve fund
  9    established in subsection (1) of this section. No reserve tax shall be imposed
 10    for any calendar year if, as of September 30 of the preceding  calendar  year,
 11    the  balance  of  the  reserve  fund equals or exceeds one percent (1%) of the
 12    state taxable wages for the penultimate calendar year, or  exceeds  forty-nine
 13    percent  (49%)  of the actual balance of the employment security fund, section
 14    72-1346, Idaho Code.
 15        (3)  The interest earned from investment of  the  reserve  fund  shall  be
 16    deposited  in  a fund established in the state treasurer's office, to be known
 17    as the department of commerce and labor special administration fund, hereinaf-
 18    ter "special administration fund." The moneys in  the  special  administration
 19    fund  shall  be  held  separate  and apart from all other public funds of this
 20    state. The state treasurer shall be the custodian of this fund and may  invest
 21    said  moneys  in accordance with law. Any interest earned on said moneys shall
 22    be deposited in the special administration fund. In the absence of a  specific
 23    appropriation,  the  moneys in the special administration fund are perpetually
 24    appropriated to the director and may be expended  with  the  approval  of  the
 25    advisory  council appointed pursuant to section 72-1336, Idaho Code, for costs
 26    related to employment service programs  and  unemployment  insurance  programs
 27    administered  under  this chapter by the department. The director shall report
 28    annually to the joint finance-appropriations committee and the advisory  coun-
 29    cil the expenditures and disbursements made from the fund during the preceding
 30    fiscal  year, and the expenditures and disbursements and commitments made dur-
 31    ing the current fiscal year to date.
 32        (4)  Administrative costs related to the  reserve  fund  and  the  special
 33    administration  fund shall be paid from federal administrative grants received
 34    under title III of the social security act, to the extent permitted by federal
 35    law, and then from the special administration fund.
                                                                        
 36        SECTION 6.  That Section 72-1347B, Idaho Code, be, and the same is  hereby
 37    amended to read as follows:
                                                                        
 38        72-1347B.  WORKFORCE  DEVELOPMENT  TRAINING FUND. (1) There is established
 39    in the state treasury a special trust fund, separate and apart from all  other
 40    public  funds of this state, to be known as the workforce development training
 41    fund, hereinafter "training fund."  Except as provided  herein,  all  proceeds
 42    from  the training tax defined in subsection (4) of this section shall be paid
 43    into the training fund. The state treasurer shall  be  the  custodian  of  the
 44    training  fund and shall invest said moneys in accordance with law. Any inter-
 45    est earned on the moneys in the training fund shall be deposited in the train-
 46    ing fund. Moneys in the training fund shall be disbursed  in  accordance  with
 47    the  directions of the director. In any month when the unencumbered balance in
 48    the training fund exceeds six million dollars ($6,000,000), the excess  amount
 49    over  six  million dollars ($6,000,000) shall be transferred to the employment
 50    security reserve fund, section 72-1347A, Idaho Code. For the purposes of  this
 51    subsection  (1),  the unencumbered balance in the training fund is the balance
 52    in such fund reduced by the sum of:
 53        (a)  The amounts that  have  been  obligated  pursuant  to  fully-executed
                                                                        
                                           6
                                                                        
  1        workforce development training fund contracts;
  2        (b)  The  amounts  that  have been obligated pursuant to letters of intent
  3        for proposed job training projects; and
  4        (c)  Any administrative costs related to the training fund  that  are  due
  5        and payable.
  6        (2)  All  moneys  in the training fund are perpetually appropriated to the
  7    director for expenditure in accordance with the provisions  of  this  section.
  8    The purpose of the training fund is to provide or expand training and retrain-
  9    ing  opportunities in an expeditious manner that would not otherwise exist for
 10    Idaho's workforce. The training fund is intended to  supplement,  but  not  to
 11    supplant  or compete with, money available through existing training programs.
 12    The moneys in the training fund shall be used for the following purposes:
 13        (a)  To provide training for skills necessary for specific economic oppor-
 14        tunities and industrial expansion initiatives;
 15        (b)  To provide training to upgrade the skills of currently employed work-
 16        ers at risk of being permanently laid off;
 17        (c)  For refunds of training taxes erroneously collected and deposited  in
 18        the workforce training fund;
 19        (d)  For all administrative expenses incurred by the department associated
 20        with  the  collection  of  the  training  tax and any other administrative
 21        expenses associated with the training fund.
 22        (3)  Expenditures from the training fund for purposes authorized in  para-
 23    graphs  (a) and (b) of subsection (2) of this section shall be approved by the
 24    director in consultation with  the office of the  governor,  based  on  proce-
 25    dures,  criteria and performance measures established by the council appointed
 26    pursuant to section 72-1336, Idaho Code. The activities funded by the training
 27    fund will be coordinated with similar activities funded by the state  division
 28    of  professional-technical  education. Expenditures from the training fund for
 29    purposes authorized in paragraphs (c) and (d) of subsection (2) of  this  sec-
 30    tion  shall  be  approved by the director. The director shall pay all approved
 31    expenditures as long as the training fund has a positive balance. The  council
 32    shall  report  annually  to  the governor and the joint finance-appropriations
 33    committee the commitments and expenditures made from the training fund in  the
 34    preceding fiscal year and the results of the activities funded by the training
 35    fund.
 36        (4)  A training tax is hereby imposed on all covered employers required to
 37    pay  contributions pursuant to section 72-1350, Idaho Code, with the exception
 38    of deficit employers who have been assigned a  taxable  wage  rate  from  rate
 39    class six pursuant to section 72-1350, Idaho Code. The training tax rate shall
 40    be  equal  to  three  percent (3%) of the taxable wage rate then in effect for
 41    each eligible, standard-rated and deficit employer. The training tax shall  be
 42    due and payable at the same time and in the same manner as contributions. This
 43    subsection  is repealed effective January 1, 2007, unless, prior to that date,
 44    the Idaho legislature approves the continuation of this subsection  by  repeal
 45    of this sunset clause.
 46        (5)  The provisions of this chapter which apply to the payment and collec-
 47    tion   of contributions also apply to the payment and collection of the train-
 48    ing tax, including the same calculations, assessments, method of payment, pen-
 49    alties, interest, costs, liens, injunctive relief, collection  procedures  and
 50    refund  procedures.  In  the administration of the provisions of this section,
 51    the director is granted all rights, authority, and prerogatives granted  under
 52    the  provisions  of this chapter. Moneys collected from an employer delinquent
 53    in paying contributions, reserve taxes  and  the training tax shall  first  be
 54    applied to any penalty and interest imposed pursuant to the provisions of this
 55    chapter  and shall then be applied pro rata to delinquent contributions to the
                                                                        
                                           7
                                                                        
  1    employment security fund, section  72-1346,  Idaho  Code,  delinquent  reserve
  2    taxes to the reserve fund, section 72-1347A, Idaho Code, and delinquent train-
  3    ing  taxes to the training fund. Any interest and penalties collected pursuant
  4    to this subsection shall be paid into the state employment  security  adminis-
  5    trative  and reimbursement fund, section 72-1348, Idaho Code, and any interest
  6    or penalties refunded under this subsection shall be paid  out  of  that  same
  7    fund.  Training  taxes  paid pursuant to this section shall not be credited to
  8    the employer's experience rating account  and  may  not  be  deducted  by  any
  9    employer from the wages of individuals in its employ. All training taxes shall
 10    be  deposited in the clearing account of the employment security fund, section
 11    72-1346, Idaho Code, for clearance only and shall  not  become  part  of  such
 12    fund.  After  clearance,  the  moneys  shall be deposited in the training fund
 13    established in subsection (1) of this section.
 14        (6)  Administrative costs related to the training fund shall be paid  from
 15    the training fund in accordance with subsection (3) of this section.
                                                                        
 16        SECTION  7.  That  Section 72-1349, Idaho Code, be, and the same is hereby
 17    amended to read as follows:
                                                                        
 18        72-1349.  PAYMENT OF CONTRIBUTIONS. (1) Contributions  shall  be  paid  on
 19    taxable  wages for each calendar year equal to the amount determined in accor-
 20    dance with section 72-1350(1), Idaho Code. Contributions on wages paid  to  an
 21    individual  under  another  state  unemployment  insurance  law, or paid by an
 22    employer's predecessor during the calendar year, shall be counted in complying
 23    with this provision.
 24        (2)  Contributions  shall  accrue  and  become  payable  by  each  covered
 25    employer for each calendar quarter with respect to wages for  covered  employ-
 26    ment. Such contributions shall become due and be paid by each covered employer
 27    to  the  director  for  the employment security fund and shall not be deducted
 28    from the wages of individuals employed by such employer. All  moneys  required
 29    to  be  paid by a covered employer pursuant to this chapter shall immediately,
 30    upon becoming due and payable, become or be  deemed  money  belonging  to  the
 31    state,  and  every covered employer shall hold or be deemed to hold said money
 32    separately, aside, or in trust from any other funds, moneys or  accounts,  for
 33    the state of Idaho for payment in the manner and at the times provided by law.
 34        (3)  The  contributions  payable by each covered employer, with respect to
 35    covered employment, accruing in each calendar quarter, shall  be  paid  on  or
 36    before the last day of the month following the close of said calendar quarter.
 37        (4)  The  director may, for good cause shown by a covered employer, extend
 38    the time for payment of his contributions or any part  thereof,  but  no  such
 39    extension  of time shall postpone the due date more than sixty (60) days. Con-
 40    tributions with respect to which an extension of time  for  payment  has  been
 41    granted  shall  be  paid on or before the last day of the period of the exten-
 42    sion.
 43        (5)  Whenever it appears to be essential to the proper  administration  of
 44    this  chapter  that collection of the contributions of a covered employer must
 45    be made more often than quarterly, the director shall have authority to demand
 46    payment of the contributions forthwith.
 47        (6)  In accordance with rules the director may prescribe,  any  person  or
 48    persons  entering  into  a  formal  contract with the state, any county, city,
 49    town, school or irrigation district, or any quasi public  corporation  of  the
 50    state,  for  the construction, alteration, or repair of any public building or
 51    public work, the contract price of which exceeds the sum of one thousand  dol-
 52    lars ($1,000) may be required before commencing such work, to execute a surety
 53    bond in an amount sufficient to cover contributions when due. If the director,
                                                                        
                                           8
                                                                        
  1    who  shall  approve  said  bond, determines that said bond has become insuffi-
  2    cient, he may require that a new bond be provided in the  amount  he  directs.
  3    Failure on the part of the employer covered by the bond to pay the full amount
  4    of  his  contributions when due shall render the surety liable on said bond as
  5    though the surety was the employer and subject to the other provisions of this
  6    chapter.
  7        (7)  In the payment of any contributions a fractional  part  of  a  dollar
  8    shall  be disregarded unless it amounts to fifty cents (50¢) or more, in which
  9    case it shall be increased to one dollar ($1.00).
                                                                        
 10        SECTION 8.  That Section 72-1350, Idaho Code, be, and the same  is  hereby
 11    amended to read as follows:
                                                                        
 12        72-1350.  TAXABLE  WAGE  BASE AND TAXABLE WAGE RATES. (1) All remuneration
 13    for personal services as defined in section 72-1328, Idaho Code, equal to  the
 14    average  annual  wage in covered employment for the penultimate calendar year,
 15    rounded to the nearest multiple of one hundred dollars ($100), or  the  amount
 16    of  taxable wage base specified in the federal unemployment tax act, whichever
 17    is higher, shall be the taxable wage base for purposes of this  chapter.  Pro-
 18    vided however, and notwithstanding any other provision of the employment secu-
 19    rity  law  to  the contrary, for calendar years 2003 and 2004 the taxable wage
 20    base shall be twenty-seven thousand six hundred dollars ($27,600),  which  was
 21    the taxable wage base in effect for calendar year 2002.
 22        (2)  Prior  to  December 31 of each year, the director shall determine the
 23    taxable wage rates for the following calendar year for aAll covered employers,
 24    except those eligible and electing  the  cost  reimbursement  payment  method,
 25    shall  be  assigned  taxable wage rates annually by the director employers, in
 26    accordance with the following this section,  provided  however,  and  notwith-
 27    standing  any  other provision of the employment security law to the contrary,
 28    for calendar years 20035 and 20046, the taxable wage  rates  for  all  covered
 29    experience-rated employers except cost reimbursement employers shall be deter-
 30    mined in accordance with schedule II as follows:
 31        (a)  For  calendar  year  2005,  the taxable wage rate shall be determined
 32        using a base tax rate of one and fifty hundredths percent (1.50%);
 33        (b)  For calendar year 2006, the taxable wage  rate  shall  be  determined
 34        using  a  base  tax rate of one and sixty-seven hundredths percent (1.67%)
 35        unless, at any time prior to September 30, 2005, the actual balance in the
 36        employment security fund, section 72-1346, Idaho Code,  is  fifty  percent
 37        (50%)  or  less  than  the  actual  balance  in  the reserve fund, section
 38        72-1347A, Idaho Code, in which case the taxable wage rate shall be  deter-
 39        mined  using  a base tax rate calculated in accordance with subsection (5)
 40        of this section.
 41        (3)  A desired employment security fund size An average  high  cost  ratio
 42    shall be determined for each calendar year by calculating from the penultimate
 43    year,  the ten (10) year average of annual the three (3) highest benefits paid
 44    to wages covered, multiplied by one and  one-half  (1.5)  cost  rates  in  the
 45    twenty  (20)  year  period ending with the preceding year. For the purposes of
 46    this section, the "benefit cost rate"  is  the  total  annual  benefits  paid,
 47    including  the  state's  share  of extended benefits but excluding the federal
 48    share of extended benefits and cost  reimbursable  benefits,  divided  by  the
 49    total  annual  covered  wages excluding cost reimbursable wages. The resulting
 50    average high cost ratio, when applied to the covered wages of the  penultimate
 51    year, represents is multiplied by the desired fund size. This calculation mul-
 52    tiplier  of  eight-tenths (0.8), and the result, for the purposes of this sec-
 53    tion, is hereafter referred to as the "average high cost multiple" (AHCM).
                                                                        
                                           9
                                                                        
  1        (4)  The ACM shall be the ratio at the top of taxable wage rate schedule V
  2    as provided in subsection (7) of this section, and all other ratios for sched-
  3    ules I through IX are adjusted up or down from schedule V in equal  increments
  4    of .005.
  5        (5)  The  taxable  wage  rate schedule for each calendar year fund balance
  6    ratio shall be determined by comparing the ratio of dividing the  actual  bal-
  7    ance  of  the  employment  security fund, section 72-1346, Idaho Code, and the
  8    reserve fund, section 72-1347A, Idaho Code, on September 30, to of the current
  9    calendar year by the wages covered paid by all  covered  employers  in  Idaho,
 10    except  cost  reimbursement  employers,  in the penultimate preceding calendar
 11    year. against the taxable wage schedule ratios as provided in  subsection  (4)
 12    of this section.
 13        (5)  The base tax rate shall be determined as follows:
 14        (a)  Divide the fund balance ratio by the AHCM;
 15        (b)  Subtract  the  quotient  obtained  from  the calculation in paragraph
 16        (5)(a) of this section from the number two (2);
 17        (c)  Multiply the remainder obtained from  the  calculation  in  paragraph
 18        (5)(b)  of  this  section by two and one-tenth percent (2.1%). The product
 19        obtained from this calculation shall equal the  base  tax  rate,  provided
 20        however,  that  the  base tax rate shall not be less than sixty-three hun-
 21        dredths percent (0.63%) and shall not exceed  three  and  thirty-six  hun-
 22        dredths percent (3.36%).
 23        (6)  The  ratios  computed for each taxable wage rate schedule as provided
 24    in base tax rate calculated in accordance with subsection (45) of this section
 25    shall be placed with their appropriate schedule at the top of the columns used
 26    to determine the taxable wage rate effective the following calendar  year  for
 27    all  covered employers except cost reimbursement employers as provided in sub-
 28    sections (7) and (8) of this section, and shall  represent  the  minimum  fund
 29    level required for the specific schedule to be in effect.
                                                                        
                                           10
                                                                        


1



 



(7)  Schedules of Table of Rate Classes, Tax Factors and Minimum and Maximum Taxable Wage Rates



2



 



 



 



 



SCHED.



SCHED.



SCHED.


SCHED.



SCHED.



SCHED.



SCHED.


SCHED.



SCHED.

3         I II III IV V VI

VII



VIII



IX

4    Cumulative Taxable                    
5   Payroll Limits   +.020 +.015 +.010 +.005 ACM -.005 -.010 -.015  
6       Equal to                  
7       or Less                  
8     More Than Than (% of  
Taxable Wage Rates for Eligible Employers
       
9   (% of Total Total                  
10   Rate Taxable Taxable                  
11   Class Payroll) Payroll)                  
12                          
13   1 12 0.1% 0.2% 0.4% 0.8% 1.2% 1.6% 2.0% 2.2% 2.4%
14   2 12 24 0.2 0.4 0.6 1.0 1.4 1.8 2.2 2.4 2.6
15   3 24 36 0.4 0.6 0.8 1.2 1.6 2.0 2.4 2.6 2.8
16   4 36 48 0.6 0.8 1.0 1.4 1.8 2.2 2.6 2.8 3.0
17   5 48 60 0.8 1.0 1.2 1.6 2.0 2.4 2.8 3.0 3.2
18   6 60 72 1.0 1.2 1.4 1.8 2.2 2.6 3.0 3.2 3.4
19   7 72 1.2 1.4 1.6 2.0 2.4 2.8 3.2 3.4 3.6
20                      
21   Taxable Wage Rates for                  
22   Standard-Rated                    
23   Employers:   1.3%  1.5%  1.7%  2.1%  2.5%  2.9%  3.3%  3.5%  3.7%
24                          
25 Cumulative Taxable                    
26   Payroll Limits                    
27         Equal to                
28         or Less                
29       More Than Than (% of     Taxable Wage Rates for Deficit Employers    
30       (% of Total Total                
31   Rate   Taxable Taxable                
32   Class   Payroll) Payroll)                
33 1 30 2.4% 2.6% 2.8% 3.2% 3.6% 4.0% 4.4% 4.6% 4.8%  
34 2 30 50 2.8 3.0 3.2 3.6 4.0 4.4 4.8 5.0 5.2  
35 3 50 65 3.2 3.4 3.6 4.0 4.4 4.8 5.2 5.4 5.6  
36 4 65 80 3.6 3.8 4.0 4.4 4.8 5.2 5.6 5.8 6.0  
37 5 80 95 4.0 4.2 4.4 4.8 5.2 5.6 6.0 6.2 6.4  
38 6 95 5.4 5.4 5.4 5.4 5.6 6.0 6.4 6.6 6.8  
                                                                        
                                           11
                                                                        
  1               Cumulative Taxable Payroll Limits   Eligible Employers
  2               More Than      Equal to               Minimum     Maximum
  3                 (% of      or Less Than             Taxable     Taxable
  4     Rate       Taxable     (% of Taxable   Tax       Wage        Wage
  5     Class      Payroll)      Payroll)    Factor      Rate        Rate
  6      1            --          12         0.2857      0.180%      0.960%
  7      2            12          24         0.4762      0.300%      1.600%
  8      3            24          36         0.5714      0.360%      1.920%
  9      4            36          48         0.6667      0.420%      2.240%
 10      5            48          60         0.7619      0.480%      2.560%
 11      6            60          72         0.8571      0.540%      2.880%
 12      7            72          --         0.9524      0.600%      3.200%
                                                                        
 13                                                   Standard-Rated Employers
 14                                                     Minimum     Maximum
 15                                                     Taxable     Taxable
 16                                            Tax       Wage        Wage
 17                                          Factor      Rate        Rate
 18                                           1.000      1.000%      3.360%
                                                                        
 19               Cumulative Taxable Payroll Limits   Deficit Employers
 20               More Than      Equal to               Minimum     Maximum
 21                 (% of      or Less Than             Taxable     Taxable
 22     Rate       Taxable     (% of Taxable   Tax       Wage        Wage
 23     Class      Payroll)      Payroll)    Factor      Rate        Rate
 24      -1           --          30         1.7143      1.080%      4.800%
 25      -2           30          50         1.9048      1.200%      5.200%
 26      -3           50          65         2.0952      1.320%      5.600%
 27      -4           65          80         2.2857      1.440%      6.000%
 28      -5           80          95         2.6667      1.680%      6.400%
 29      -6           95          --         2.6667      5.400%      6.800%
 30        (8)  Each  covered  employer, except cost reimbursement employers, will be
 31    assigned a taxable wage rate from the effective taxable wage rate schedule for
 32    eligible, standard-rated and deficit  employers,  based  upon  the  employer's
 33    experience  as  determined under the provisions of sections 72-1319, 72-1319A,
 34    72-1319B and 72-1351, Idaho Code. and a contribution rate as follows:
 35        (a)  Each employer, except standard-rated employers, will be  assigned  to
 36        one (1) of the rate classes for eligible and deficit employers provided in
 37        subsection  (7)  of  this  section based upon the employer's experience as
 38        determined under the provisions of sections 72-1319, 72-1319A, 72-1351 and
 39        72-1351A, Idaho Code.
 40        (b)  For each rate class provided in subsection (7) of this  section,  the
 41        department  will  multiply the base tax rate determined in accordance with
 42        subsection (5) of this section by the tax  factor  listed  for  that  rate
 43        class in the table provided in subsection (7) of this section. The product
 44        obtained  from this calculation shall be the taxable wage rate for employ-
 45        ers assigned to that rate class, provided however, that the  taxable  wage
 46        rate shall not be less than the minimum taxable wage rate assigned to that
 47        rate  class and shall not exceed the maximum taxable wage rate assigned to
 48        that rate class in the table provided in subsection (7) of this section.
 49        (c)  For standard-rated employers, the department will multiply  the  base
 50        tax  rate  determined in accordance with subsection (5) of this section by
 51        the tax factor listed for standard-rated employers in the  table  provided
 52        in subsection (7) of this section. The product obtained from this calcula-
 53        tion shall be the taxable wage rate for standard-rated employers, provided
                                                                        
                                           12
                                                                        
  1        however,  that  the  taxable  wage rate shall not be less than the minimum
  2        taxable wage rate assigned  to  standard-rated  employers  and  shall  not
  3        exceed  the maximum taxable wage rate assigned to standard-rated employers
  4        in the table provided in subsection (7) of this section.
  5        (d)  Deficit employers who have been assigned a  taxable  wage  rate  from
  6        deficit  rate class six will be assigned contribution rates equal to their
  7        taxable wage rate.
  8        (be)  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  9.  That  Section 72-1351, Idaho Code, be, and the same is hereby
 27    amended to read as follows:
                                                                        
 28        72-1351.  EXPERIENCE RATING. (1) Subject to the other provisions  of  this
 29    chapter,  each  eligible  and  deficit  employer's  (except cost reimbursement
 30    employers) taxable wage rate shall be determined in the manner set forth below
 31    for each calendar year:
 32        (a)  (i)  Each eligible employer shall be  given  an  "experience  factor"
 33             which  shall  be  the  ratio of excess of contributions over benefits
 34             paid on the employer's account since December 31, 1939, to his  aver-
 35             age  annual  taxable  payroll rounded to the next lower dollar amount
 36             for the four (4) fiscal years immediately preceding  the  computation
 37             date,  except  that  when  an  employer  first  becomes eligible, his
 38             "experience factor" will be computed on his  average  annual  taxable
 39             payroll  for the two (2) fiscal years or more, but not to exceed four
 40             (4) fiscal years, immediately preceding  the  computation  date.  The
 41             computation  of  such "experience factor" shall be to six (6) decimal
 42             places.
 43             (ii)  Each deficit employer shall be given a "deficit experience fac-
 44             tor" which shall be the ratio of  excess  of  benefits  paid  on  the
 45             employer's account over contributions since December 31, 1939, to his
 46             average  annual  taxable  payroll  rounded  to  the next lower dollar
 47             amount for one (1) or more fiscal years, but not to exceed  four  (4)
 48             fiscal  years, for which he had covered employment ending on the com-
 49             putation date; provided, however, that any employer who on any compu-
 50             tation date has a "deficit experience factor" for the period  immedi-
 51             ately  preceding such computation date but who has filed all reports,
 52             paid all contributions and penalties due on  or  before  the  cut-off
 53             date,  and  has  during the last four (4) fiscal years paid contribu-
                                                                        
                                           13
                                                                        
  1             tions at a rate of not less than the  standard  rate  applicable  for
  2             each  such  year  and in excess of benefits charged to his experience
  3             rating account during such years, shall have any balance of  benefits
  4             charged to his account which on the computation date immediately pre-
  5             ceding  such  four  (4)  fiscal years were in excess of contributions
  6             paid, deleted from his account, and the excess  benefits  so  deleted
  7             shall  not  be considered in the computation of his taxable wage rate
  8             for the rate years following such four (4) fiscal years. For the rate
  9             year following such computation date, he shall be given the  standard
 10             rate for that year.
 11             (iii) In the event an employer's coverage has been terminated because
 12             he  has  ceased  to  do  business  or  because he has not had covered
 13             employment for a period of four  (4)  years,  and  if  said  employer
 14             thereafter  becomes  a  covered  employer,  he  will be considered as
 15             though he were a new employer, and he shall not be credited with  his
 16             previous  experience  under this chapter for the purpose of computing
 17             any future "experience factor."
 18        (b)  Schedules shall be prepared listing all eligible employers in inverse
 19        numerical order of their experience factors, and all deficit employers  in
 20        numerical order of their deficit experience factors. There shall be listed
 21        on  such  schedules  for  each such employer in addition to the experience
 22        factor (i) the amount of his taxable payroll for the fiscal year ending on
 23        the computation date, and (ii) a cumulative total consisting of the sum of
 24        such employer's taxable payroll for the fiscal year ending on the computa-
 25        tion date and the corresponding taxable payrolls for all  other  employers
 26        preceding him on such schedules.
 27        (c)  The  cumulative  taxable payroll amounts listed on the schedules pro-
 28        vided for in paragraph (b) of this subsection  shall  be  segregated  into
 29        groups  whose  limits  shall be those set out in the table of schedules of
 30        taxable wage rates, provided in section 72-1350(7), Idaho  Code.  Each  of
 31        such  groups  shall  be  identified by the rate class number listed in the
 32        table which represents the percentage limits of each group. Each  employer
 33        on  the  schedules  shall be assigned the a taxable wage rate opposite his
 34        rate class for the tax schedule in effect for the taxable year  in  accor-
 35        dance with section 72-1350, Idaho Code.
 36             (d)  (i)   If  the grouping of rate classes requires the inclusion of
 37             exactly one-half (1/2) of an employer's taxable payroll, the employer
 38             shall be assigned the lower of the two (2) rates designated  for  the
 39             two  (2)  classes  in  which the halves of his taxable payroll are so
 40             required.
 41             (ii)  If the group of rate classes requires the inclusion of  a  por-
 42             tion  other than exactly one-half (1/2) of an employer's taxable pay-
 43             roll, the employer shall be assigned  the  rate  designated  for  the
 44             class  in  which  the  greater  part  of  his  taxable  payroll is so
 45             required.
 46             (iii) If one (1) or more employers on the schedules  have  experience
 47             factors identical to that of the last employer included in a particu-
 48             lar  rate class, all such employers shall be included in and assigned
 49             the taxable wage rate specified for such class,  notwithstanding  the
 50             provisions of paragraph (c) of this subsection.
 51        (e)  If  the  taxable payroll amount or the experience factor or both such
 52        taxable payroll amount and experience factor of any  eligible  or  deficit
 53        employer  listed on the schedules is changed, the employer shall be placed
 54        in that position on the schedules which  he would have  occupied  had  his
 55        taxable  payroll  amount  and/or experience factor as changed been used in
                                                                        
                                           14
                                                                        
  1        determining his position in the first instance, but such change shall  not
  2        affect the position or rate classification of any other employer listed on
  3        the  schedules  and  shall  not affect the rate determination for previous
  4        years.
  5        (2)  For experience rating purposes, all  previously  accumulated  benefit
  6    charges  to  covered employers' accounts, except cost reimbursement employers,
  7    shall not be changed except as provided by this chapter. Benefits  paid  prior
  8    to  June  30 shall, as of June 30 of each year preceding the calendar year for
  9    which a covered employer's taxable wage rate is effective, be charged  to  the
 10    account of the covered employer, except cost reimbursement employers, who paid
 11    the  largest individual amount of base period wages as shown on the determina-
 12    tion used as the basis for the payment of such benefits, except that no charge
 13    shall be made to the account of such covered employer with respect to benefits
 14    paid under the following situations:
 15        (a)  If paid to a worker who terminated his services  voluntarily  without
 16        good  cause  attributable  to  such covered employer, or who had been dis-
 17        charged for misconduct in connection with such services;
 18        (b)  If paid in accordance with the  provisions  of  section  72-1368(10),
 19        Idaho Code, and the decision to pay benefits is subsequently reversed; or
 20        (c)  For that portion of benefits paid to multistate claimants pursuant to
 21        section  72-1344,  Idaho  Code,  which exceeds the amount of benefits that
 22        would have been charged had only Idaho  wages  been  used  in  paying  the
 23        claim;
 24        (d)  If  paid in accordance with the extended benefit program triggered by
 25        either national or state indicators;
 26        (e)  If paid to a worker who continues to perform services for  such  cov-
 27        ered  employer without a reduction in his customary work schedule, and who
 28        is eligible to receive benefits due to layoff or a reduction  in  earnings
 29        from another employer.
 30        (3)  A  covered employer whose experience rating account is chargeable, as
 31    prescribed by this section, is an  interested  party  as  defined  in  section
 32    72-1323,  Idaho  Code.  A  determination  of  chargeability shall become final
 33    unless, within  fourteen  (14)  days  after  notice  as  provided  in  section
 34    72-1368(5),  Idaho  Code,  an  appeal is filed by an interested party with the
 35    department in accordance with the department's rules.
 36        (4)  An experience rating record shall  be  maintained  for  each  covered
 37    employer.  The  record shall be credited with all contributions which the cov-
 38    ered employer has paid for covered employment prior to the cut-off date,  pur-
 39    suant  to the provisions of this and preceding acts, and which covered employ-
 40    ment occurred prior to the computation date. The record shall also be  charged
 41    with  the  amount  of  benefits  paid  which  are  chargeable  to  the covered
 42    employer's account as provided by the appropriate provisions of the employment
 43    security law and regulations thereunder in effect at the  time  such  benefits
 44    were  paid.  Nothing  in  this section shall be construed to grant any covered
 45    employer or individual in his service a priority with respect to any claim  or
 46    right  because  of  amounts  paid by such covered employer into the employment
 47    security fund.
 48        (45)  (a) Whenever any individual or type of organization (whether or  not
 49        a  covered  employer within the meaning of section 72-1315, Idaho Code) in
 50        any manner succeeds to, or acquires all or substantially all, of the busi-
 51        ness of an employer who at the time of acquisition was a covered employer,
 52        and in respect to whom the director finds that the business of the  prede-
 53        cessor  is continued solely by the successor, the separate experience rat-
 54        ing account of the predecessor shall, upon the joint  application  of  the
 55        predecessor  and  the  successor  within the one hundred eighty (180) days
                                                                        
                                           15
                                                                        
  1        after such acquisition and approval by the director, be transferred to the
  2        successor employer for the purpose of determining such successor's liabil-
  3        ity and taxable wage rate and any successor who was not an employer on the
  4        date of acquisition shall as of such date become  a  covered  employer  as
  5        defined  in  this chapter. Such one hundred eighty (180) day period may be
  6        extended  at  the  discretion  of  the  director.  The  transfer  of   the
  7        predecessor's experience rating account as of the last computation date to
  8        the successor shall be mandatory if the management or ownership or control
  9        is  substantially  the  same  for the successor as for the predecessor and
 10        there is a continuity of business activity by the successor.
 11        (b)  Whenever any individual or type of organization,  whether  or  not  a
 12        covered employer within the meaning of section 72-1315, Idaho Code, in any
 13        manner  succeeds  to, or acquires, part of the business of an employer who
 14        at the time of acquisition was a covered employer, and such portion of the
 15        business is continued by the successor, so much of the separate experience
 16        rating account of the predecessor as is attributable to the portion of the
 17        business transferred, as determined on a pro rata basis in the same  ratio
 18        that  the wages of covered employees properly allocable to the transferred
 19        portion of the business bears to the payroll of  the  predecessor  in  the
 20        last  four  (4) completed calendar quarters immediately preceding the date
 21        of transfer, shall, upon the joint application of the predecessor and  the
 22        successor  within one hundred eighty (180) days after such acquisition and
 23        approval by the director, be transferred to the successor employer for the
 24        purpose of determining such successor's liability and  taxable  wage  rate
 25        and any successor who was not an employer on the date of acquisition shall
 26        as of such date become a covered employer as defined in this chapter. Such
 27        one  hundred  eighty (180) day period may be extended at the discretion of
 28        the director. The transfer of the predecessor's experience rating  account
 29        as of the last computation date to the successor shall be mandatory if the
 30        management  or ownership or control is substantially the same for the suc-
 31        cessor as for the predecessor and there is a continuity of business activ-
 32        ity by the successor. Whenever such mandatory  transfer  involves  only  a
 33        portion  of the experience rating record, and the predecessor or successor
 34        employers fail within ten (10) days after notice to  supply  the  required
 35        payroll information, the transfer shall be based on estimates of the allo-
 36        cable payrolls.
 37             (c)  (i)   If  the successor was a covered employer prior to the date
 38             of the acquisition of all or a part of the predecessor's business his
 39             taxable wage rate, effective the first day of  the  calendar  quarter
 40             immediately  following the date of acquisition, shall be a newly com-
 41             puted rate based on the combined experience of  the  predecessor  and
 42             successor,  the resulting rate remaining in effect the balance of the
 43             rate year.
 44             (ii)  If the successor was not a covered employer prior to  the  date
 45             of  the  acquisition  of all or a part of the predecessor's business,
 46             his rate shall be the rate applicable to the predecessor with respect
 47             to the period immediately preceding the date of acquisition,  but  if
 48             there  were  more than one (1) predecessor the successor's rate shall
 49             be a newly computed rate based on the combined experience of the pre-
 50             decessors, becoming effective immediately after the date of  acquisi-
 51             tion, and shall remain in effect the balance of the rate year.
 52        (d)  For purposes of this section, an employer's experience rating account
 53        shall  consist  of  the  actual  contribution, benefit and taxable payroll
 54        experience of the employer and any amounts due  from  the  employer  under
 55        this  chapter.  When  a  transferred  experience   rating account includes
                                                                        
                                           16
                                                                        
  1        amounts due from the employer under this  chapter,  both  the  predecessor
  2        employer  and the successor employer shall be jointly and severally liable
  3        for those amounts.
                                                                        
  4        SECTION 10.  That Section 72-1354, Idaho Code, be, and the same is  hereby
  5    amended to read as follows:
                                                                        
  6        72-1354.  PENALTY ON UNPAID AMOUNTS. If any amounts due under this chapter
  7    are  not  paid by any covered employer on or before the date on which they are
  8    due, such amounts shall bear penalty at the rate of two four percent (24%)  or
  9    ten twenty dollars ($120.00), whichever is the larger, for each month or frac-
 10    tion  thereof  until  paid; provided, that in no case shall the penalty exceed
 11    the actual amounts due. The date of payment shall be deemed the date of actual
 12    receipt by the director, or if mailed, the date  of  mailing.  Penalties  col-
 13    lected  pursuant to this section shall be paid into the state employment secu-
 14    rity administrative and reimbursement fund as established by section  72-1348,
 15    Idaho  Code.  At the discretion of the director, the department may compromise
 16    the amount of penalty collected pursuant to this section if the employer shows
 17    he had good cause for failing to timely pay contributions.
                                                                        
 18        SECTION 11.  That Section 72-1359, Idaho Code, be, and the same is  hereby
 19    amended to read as follows:
                                                                        
 20        72-1359.  JEOPARDY  ASSESSMENTS.  If the director determines that the col-
 21    lection of any amounts due from any covered employer under the  provisions  of
 22    this  chapter  will  be  jeopardized by delay, he may, whether or not the time
 23    prescribed by this chapter or any rules issued  pursuant  thereto  for  making
 24    reports  and payments has expired, determine, on the basis of available infor-
 25    mation, the wages paid by such employer for covered employment and declare the
 26    amount due thereon immediately payable, and shall give written notice of  such
 27    declaration  to  such  employer.  Any amounts, including penalty and interest,
 28    that are contained in such written declaration shall be subject  to  immediate
 29    seizure pursuant to section 72-1360A, Idaho Code, as well as through any other
 30    collection procedures allowed under law. Such jeopardy assessment shall become
 31    conclusive  and  binding  upon the employer unless, wWithin fourteen (14) days
 32    after the mailing of such declaration  to  the  last  known  address  of  such
 33    employer  or  in  the absence of such mailing, within fourteen (14) days after
 34    personal delivery thereof upon the employer, the employer may files an  appeal
 35    to  the  department  setting forth grounds for such appeal. In such cases, the
 36    right of appeal shall be conditioned upon the payment of the  amount  declared
 37    to be due, less any amount already collected, or upon giving appropriate secu-
 38    rity  to  the  director  for  the payment thereof. Proceedings on such appeals
 39    shall be in accordance with the provisions of section 72-1361, Idaho Code.
                                                                        
 40        SECTION 12.  That Section 72-1360, Idaho Code, be, and the same is  hereby
 41    amended to read as follows:
                                                                        
 42        72-1360.  LIENS. (1) Upon the failure of any person to pay any amount when
 43    due  under  this  chapter, including the failure to repay overpayments as that
 44    term is defined in section 72-1369, Idaho Code, the director may file with the
 45    office of the secretary  of state, as provided in chapter 19, title 45,  Idaho
 46    Code, a notice of lien.
 47        (2)  Upon  delivery to the secretary of state, the notice of lien shall be
 48    filed and maintained in accordance with chapter 19, title 45, Idaho Code. When
 49    such notice is duly filed, all amounts due shall constitute a  lien  upon  the
                                                                        
                                           17
                                                                        
  1    entire  interest,  legal or equitable, in any property of such person, real or
  2    personal, tangible or intangible, not exempt from execution, situated  in  the
  3    state. Such lien may be enforced by the director or by any sheriff of the var-
  4    ious    counties  in  the same manner as a judgment of the district court duly
  5    docketed and the amount secured by the lien shall bear interest at the rate of
  6    the state statutory legal limit on judgments one and  one-half  (1 1/2)  times
  7    the  rate computed for judgments pursuant to section 28-22-104(2), Idaho Code,
  8    in effect on January 1 of the year in which the lien is filed, rounded  up  to
  9    the  nearest one-eighth percent (1/8%). The foregoing remedy shall be in addi-
 10    tion to all other remedies provided by law. The amount of  interest  collected
 11    pursuant  to this section may be compromised at the discretion of the director
 12    when such compromise is in the best interest of the department.
 13        (3)  In any suit or action involving the title to real or  personal  prop-
 14    erty  against  which the state has a perfected lien, the state shall be made a
 15    party to such suit or action.
                                                                        
 16        SECTION 13.  That Section 72-1366, Idaho Code, be, and the same is  hereby
 17    amended to read as follows:
                                                                        
 18        72-1366.  PERSONAL ELIGIBILITY CONDITIONS. The personal eligibility condi-
 19    tions of a benefit claimant are that:
 20        (1)  The  claimant  shall  have made a claim for benefits and provided all
 21    necessary information pertinent to eligibility.
 22        (2)  The claimant shall have registered for work and  thereafter  reported
 23    to  a  job service office or other agency in a manner prescribed by the direc-
 24    tor.
 25        (3)  The claimant shall have met the minimum wage requirements in his base
 26    period as provided in section 72-1367, Idaho Code.
 27        (4)  During the whole of any week with respect to which he claims benefits
 28    or credit to his waiting period, the claimant was:
 29        (a)  Aable to work, available for suitable work, and  seeking  work;  pro-
 30        vided,  however, that no claimant shall be considered ineligible for fail-
 31        ure to comply with the provisions of this subsection if: (i) such  failure
 32        is  due  to  an the claimant's illness or disability which occurs after he
 33        has filed a claim and during such illness or disability, the claimant does
 34        not refuse or miss suitable work that would have  provided  wages  greater
 35        than  one-half  (1/2) of the claimant's weekly benefit amount; or (ii) the
 36        claimant, because of such failure is due to  compelling  personal  circum-
 37        stance,  is  required to be absent from his normal labor market area, pro-
 38        vided that such absence failure does not exceed a  minor  portion  of  the
 39        claimant's  workweek and during which time the claimant does not refuse or
 40        miss suitable work that would have provided wages  greater  than  one-half
 41        (1/2) of the claimant's weekly benefit amount; and
 42        (b)  Living  in  a  state,  territory,  or country that is included in the
 43        interstate benefit payment plan or that is a party to  an  agreement  with
 44        the United States or the director with respect to unemployment insurance.
 45        (5)  The  claimant's  unemployment is not due to the fact that he left his
 46    employment voluntarily without good cause connected with  his  employment,  or
 47    that he was discharged for misconduct in connection with his employment.
 48        (6)  The  claimant's  unemployment  is not due to his failure without good
 49    cause to apply for available suitable work or to  accept  suitable  work  when
 50    offered to him. The longer a claimant has been unemployed, the more willing he
 51    must be to seek other types of work and accept work at a lower rate of pay.
 52        (7)  In determining whether or not work is suitable for an individual, the
 53    degree of risk involved to his health, safety, morals, physical fitness, expe-
                                                                        
                                           18
                                                                        
  1    rience,  training,  past  earnings,  length  of unemployment and prospects for
  2    obtaining local employment in his customary occupation, the  distance  of  the
  3    work  from  his residence, and other pertinent factors shall be considered. No
  4    employment shall be deemed suitable and benefits shall not be  denied  to  any
  5    otherwise  eligible individual for refusing to accept new work or to hold him-
  6    self available for work under any of the following conditions:
  7        (a)  If the vacancy of the position offered is due directly to  a  strike,
  8        lockout, or other labor dispute;
  9        (b)  If  the  wages,  hours,  or  other conditions of the work offered are
 10        below those prevailing for similar  work  in  the  locality  of  the  work
 11        offered;
 12        (c)  If,  as  a  condition  of  being  employed,  the  individual would be
 13        required to join a company union or to resign from or refrain from joining
 14        any bona fide labor organization.
 15        (8)  No claimant who is otherwise eligible shall be  denied  benefits  for
 16    any week due to an inability to comply with the requirements contained in sub-
 17    sections (4) and (6) of this section, if:
 18        (a)  The  claimant  is  a participant in a program sponsored by title I of
 19        the workforce investment act and attends a job training course under  that
 20        program; or
 21        (b)  The claimant attends a job training course authorized pursuant to the
 22        provisions  of  section  236(a)(1)  of  the trade act of 1974 or the North
 23        American free trade agreement implementation act.
 24        (c)  The claimant lacks skills to compete in the labor market and  attends
 25        a  job training course with the approval of the director. The director may
 26        approve job training courses that meet the following criteria:
 27             (i)   The purpose of the job training is to teach the claimant skills
 28             that will enhance the claimant's opportunities for employment; and
 29             (ii)  The job training can be completed within one (1)  year,  except
 30             that this requirement may be waived pursuant to rules that the direc-
 31             tor may prescribe.
 32        This  subsection  shall apply only if the claimant submits with each claim
 33    report a written certification from the training facility that the claimant is
 34    attending and satisfactorily completing the job  training  course,  or  demon-
 35    strates good cause for failure to attend the job training.
 36        (9)  No  claimant who is otherwise eligible shall be denied benefits under
 37    subsection (5) of this section for leaving employment to attend  job  training
 38    pursuant  to  subsection  (8)  of  this  section,  provided  that the claimant
 39    obtained the employment after enrollment in or during scheduled breaks in  the
 40    job  training course, or that the employment was not suitable. For purposes of
 41    this subsection, the term "suitable employment" means work of a  substantially
 42    equal  or  higher skill level than the individual's past employment, and wages
 43    for such work are not less than eighty percent (80%)  of  the  average  weekly
 44    wage in the individual's past employment.
 45        (10) A  claimant  shall  not  be eligible to receive benefits for any week
 46    with respect to which it is found that his unemployment is due to a labor dis-
 47    pute; provided, that this subsection shall not apply if it is shown that:
 48        (a)  The claimant is not participating, financing,  aiding,  abetting,  or
 49        directly interested in the labor dispute; and
 50        (b)  The claimant does not belong to a grade or class of workers with mem-
 51        bers  employed  at the premises at which the labor dispute occurs, who are
 52        participating in or directly interested in the dispute.
 53        (11) A claimant shall not be  entitled  to  benefits  for  any  week  with
 54    respect  to  which  or  a part of which he has received or is seeking benefits
 55    under an unemployment insurance law of another state or of the United  States;
                                                                        
                                           19
                                                                        
  1    provided,  that if the appropriate agency of such other state or of the United
  2    States shall finally determine that he is not entitled  to  such  unemployment
  3    compensation  or  insurance  benefits,  he shall not by the provisions of this
  4    subsection be denied benefits. For purposes of this  section,  a  law  of  the
  5    United  States  providing  any  payments  of  any  type and in any amounts for
  6    periods of unemployment due to involuntary unemployment shall be considered an
  7    unemployment insurance law of the United States.
  8        (12) A claimant shall not be entitled to benefits for a period  of  fifty-
  9    two  (52)  weeks if it is determined that he has willfully made a false state-
 10    ment or willfully failed to report a material fact in order  to  obtain  bene-
 11    fits. The period of disqualification shall commence the week the determination
 12    is  issued.  The claimant shall also be ineligible for waiting week credit and
 13    shall repay any sums received for a week in which the claimant willfully  made
 14    a  false statement or willfully failed to report a material fact. The claimant
 15    shall also be ineligible for waiting week credit or benefits for any  week  in
 16    which  he  owes  the  department  an  overpayment,  civil penalty, or interest
 17    resulting from a determination that he willfully made  a  false  statement  or
 18    willfully failed to report a material fact.
 19        (13) A claimant shall not be entitled to benefits if his principal occupa-
 20    tion is self-employment.
 21        (14) A  claimant who has been found ineligible for benefits under the pro-
 22    visions of subsection (5), (6), (7) or (9) of this section  shall  reestablish
 23    his  eligibility by having obtained bona fide work and received wages therefor
 24    in an amount of at least  twelve  fourteen  (124)  times  his  weekly  benefit
 25    amount.
 26        (15) Benefits  based on service in employment defined in sections 72-1349A
 27    and 72-1352(3), Idaho Code, shall be payable in the same amount, on  the  same
 28    terms  and  subject to the same conditions as benefits payable on the basis of
 29    other service subject to this act.
 30        (a)  If the services performed during one-half (1/2) or more of  any  con-
 31        tract period by an individual for an educational institution as defined in
 32        section  72-1322B, Idaho Code, are in an instructional, research, or prin-
 33        cipal administrative capacity, all the services shall be deemed to  be  in
 34        such capacity.
 35        (b)  If the services performed during less than one-half (1/2) of any con-
 36        tract  period  by  an  individual for an educational institution are in an
 37        instructional, research, or principal administrative capacity, none of the
 38        service shall be deemed to be in such capacity.
 39        (c)  As used in this section, "contract period" means  the  entire  period
 40        for  which  the  individual contracts to perform services, pursuant to the
 41        terms of the contract.
 42        (16) No claimant is eligible to receive benefits  in  two  (2)  successive
 43    benefit  years  unless,  after  the beginning of the first benefit year during
 44    which he received benefits, he performed service and earned an amount equal to
 45    not less than six (6) times the weekly benefit amount established  during  the
 46    first benefit year.
 47        (17) (a) Benefits  based  on  wages  earned  for  services performed in an
 48        instructional,  research, or principal administrative capacity for an edu-
 49        cational institution shall not be paid for any week of  unemployment  com-
 50        mencing  during  the  period between two (2) successive academic years, or
 51        during a similar period between two (2) terms, whether or not  successive,
 52        or  during  a  period  of  paid  sabbatical  leave  provided  for  in  the
 53        individual's contract, to any individual who performs such services in the
 54        first  academic  year  (or term) and has a contract to perform services in
 55        any such capacity for any educational institution in the  second  academic
                                                                        
                                           20
                                                                        
  1        year  or term, or has been given reasonable assurance that such a contract
  2        will be offered.
  3        (b)  Benefits based on wages earned for services performed  in  any  other
  4        capacity  for an educational institution shall not be paid to any individ-
  5        ual for any week which commences during a period between two  (2)  succes-
  6        sive school years or terms if the individual performs such services in the
  7        first school year or term, and there is a contract or reasonable assurance
  8        that  the  individual will perform such services in the second school year
  9        or term. If benefits are denied to any individual under this  subparagraph
 10        (b) and the individual was not offered an opportunity to perform such ser-
 11        vices  for  the  educational  institution  for the second academic year or
 12        term, the individual shall be entitled to a retroactive payment  of  bene-
 13        fits for each week for which the individual filed a timely claim for bene-
 14        fits and for which benefits were denied solely by reason of this clause.
 15        (c)  With  respect  to any services described in paragraphs (a) and (b) of
 16        this subsection (17), benefits shall not be paid nor "waiting week" credit
 17        given to an individual for wages earned for services for  any  week  which
 18        commences  during  an established and customary vacation period or holiday
 19        recess if the individual performed the services in the period  immediately
 20        before  the  vacation  period or holiday recess, and there is a reasonable
 21        assurance the individual will perform such services in the period  immedi-
 22        ately following such vacation period or holiday recess.
 23        (d)  With  respect  to any services described in paragraphs (a) and (b) of
 24        this subsection (17), benefits shall not be payable on the basis  of  ser-
 25        vices  in  any capacities specified in paragraphs (a), (b) and (c) of this
 26        subsection (17) to any individual who performed such services in an educa-
 27        tional institution while in the employ of an educational  service  agency.
 28        For purposes of this paragraph the term "educational service agency" means
 29        a  governmental  entity  which is established and operated exclusively for
 30        the purpose of providing such services to  one  (1)  or  more  educational
 31        institutions.
 32        (18) Benefits shall not be payable on the basis of services which substan-
 33    tially  consist  of  participating in sports or athletic events or training or
 34    preparing to participate, for any  week  which  commences  during  the  period
 35    between  two (2) successive sport seasons (or similar periods) if the individ-
 36    ual performed services in the first season (or similar period) and there is  a
 37    reasonable  assurance  that  the  individual will perform such services in the
 38    later of such season (or similar period).
 39        (19)  (a) Benefits shall not be payable on the basis of services performed
 40        by an alien unless the alien was lawfully admitted for permanent residence
 41        at the time such services were performed, was lawfully  present  for  pur-
 42        poses  of  performing  such  services,  or was permanently residing in the
 43        United States under color of law at the time the services  were  performed
 44        (including  an  alien  who  was lawfully present in the United States as a
 45        result of the application of the provisions of sections  207  and  208  or
 46        section 212(d)(5) of the immigration and nationality act).
 47        (b)  Any data or information required of individuals applying for benefits
 48        to determine eligibility under this subsection shall be uniformly required
 49        from all applicants for benefits.
 50        (c)  A  decision to deny benefits under this subsection must be based on a
 51        preponderance of the evidence.
 52        (20) An individual who has been determined to be likely to exhaust regular
 53    benefits and to need reemployment services  pursuant  to  a  profiling  system
 54    established  by  the  director must participate in those reemployment services
 55    unless:
                                                                        
                                           21
                                                                        
  1        (a)  The individual has completed such services; or
  2        (b)  There is justifiable cause, as determined by the  director,  for  the
  3        claimant's failure to participate in such services.
  4        (21)  (a) A claimant:
  5             (i)   Who  has been assigned to work for one (1) or more customers of
  6             a staffing service; and
  7             (ii)  Who, at the time of hire by  the  staffing  service,  signed  a
  8             written  notice  informing  him  that completion or termination of an
  9             assignment for a customer would not, of itself, terminate the employ-
 10             ment relationship with the staffing service;
 11        will not be considered unemployed upon completion  or  termination  of  an
 12        assignment  until  such time as he contacts the staffing service to deter-
 13        mine if further suitable work is available. If the claimant:
 14                  (A)  Contacts the staffing service and refuses a  suitable  work
 15                  assignment  that is offered to him at that time, he will be con-
 16                  sidered to have voluntarily quit that employment; or
 17                  (B)  Contacts the staffing service and the service does not have
 18                  a suitable work assignment for him, he will be considered  unem-
 19                  ployed due to a lack of work; or
 20                  (C)  Accepts   new   employment  without  first  contacting  the
 21                  staffing service for additional work, he will be  considered  to
 22                  have voluntarily quit employment with the staffing service.
 23        (b)  For  the  purposes  of  this  subsection, the term "staffing service"
 24        means any person who assigns individuals to work  for  its  customers  and
 25        includes,  but  is  not  limited to, professional employers, as defined in
 26        chapter 24, title 44, Idaho Code, and the employers of temporary employees
 27        as defined in section 44-2403(7), Idaho Code.
                                                                        
 28        SECTION 14.  That Section 72-1367, Idaho Code, be, and the same is  hereby
 29    amended to read as follows:
                                                                        
 30        72-1367.  BENEFIT FORMULA. (1) To be eligible an individual shall have the
 31    minimum  qualifying  amount of wages in covered employment in at least one (1)
 32    calendar quarter of his base period, and shall have total base period wages of
 33    at least one and one-quarter (1 1/4) times his high quarter wages. The minimum
 34    qualifying amount of wages shall be determined each July January 1  and  shall
 35    equal fifty percent (50%) of the product of the state minimum wage, as defined
 36    by section 44-1502, Idaho Code, multiplied by five hundred twenty (520) hours,
 37    rounded to the lowest multiple of twenty-six (26).
 38        (2)  The weekly benefit amount shall be one twenty-sixth (1/26) of highest
 39    quarter  wages  except  that it shall not exceed the applicable maximum weekly
 40    benefit amount. The maximum weekly benefit amount shall be established as fol-
 41    lows:
 42        (a)  For calendar year 2006 and the calendar years thereafter,  pPrior  to
 43        June 30 December 31 of each year, the director shall compute determine the
 44        state average weekly wage paid by covered employers for the preceding cal-
 45        endar  year  and the maximum weekly benefit amount to be effective for new
 46        claims filed in the first full week of the  following  January  and  filed
 47        thereafter  until  a  new  maximum weekly benefit amount becomes effective
 48        under this subsection (2). The maximum  weekly  benefit  amount  shall  be
 49        sixty  percent (60%) determined based on the following table, using a per-
 50        centage of the state average weekly wage paid by covered employers for the
 51        preceding calendar year and the base tax rate that has been calculated for
 52        the following calendar year pursuant to section 72-1350, Idaho Code:
                                                                        
                                           22
                                                                        
  1                               Maximum WBA Index
                                                                        
  2    Base Tax Rate                                            Average Weekly Wage
  3    At Least                    Less Than                     Percentage
  4    0.630%                         0.840%                            60%
  5    0.840%                         1.155%                            59%
  6    1.155%                         1.470%                            58%
  7    1.470%                         1.785%                            57%
  8    1.785%                         2.100%                            56%
  9    2.100%                         2.415%                            55%
 10    2.415%                         2.730%                            54%
 11    2.730%                         3.045%                            53%
 12    3.045%                         3.360%                            52%
 13        (b)  Effective for new claims filed in the first full week of  July  2005,
 14        and  filed  thereafter until the first full week of the following January,
 15        the maximum weekly benefit amount shall be fifty-seven  percent  (57%)  of
 16        the  state average weekly wage paid by covered employers for the preceding
 17        calendar year. Prior to December 31, 2005, the director  shall  determine,
 18        by using the table provided in subsection (2)(a) of this section, the max-
 19        imum  weekly  benefit  amount  to be effective for new claims filed in the
 20        first full week of the following January and filed thereafter until a  new
 21        maximum weekly benefit amount becomes effective under subsection (2)(a) of
 22        this section.
 23        (3)  Any  eligible individual shall be entitled during any benefit year to
 24    a total amount of benefits equal to his weekly benefit amount times the number
 25    of full weeks of benefit entitlement appearing in the following table based on
 26    his ratio of total base period earnings to highest quarter base  period  earn-
 27    ings.
 28       Ratio of Total Base Period                                  Full Weeks
 29       Earnings to Highest Quarter                                 of Benefit
 30                Earnings                                           Entitlement
                                                                        
 31    At Least                    Less Than
 32    1.25                             1.50                             10
 33    1.50                          1.75625                            121
 34    1.75625                     2.001.750                            142
 35    2.001.750                   2.251.875                            163
 36    2.251.875                    2.502.00                            184
 37    2.502.00                    2.752.125                           2015
 38    2.75125                     3.002.250                           2216
 39    3.002.250                   3.252.375                           2417
 40    3.252.375                     --2.500                           2618
 41    2.500                           2.625                             19
 42    2.625                           2.750                             20
 43    2.750                           2.875                             21
 44    2.875                           3.000                             22
 45    3.000                           3.125                             23
 46    3.125                           3.250                             24
 47    3.250                           3.500                             25
 48    3.500                              --                             26
 49        (4)  If  the  total wages payable to an individual for less than full-time
 50    work performed in a week claimed exceed one-half (1/2) of his  weekly  benefit
 51    amount,  the  amount of wages that exceed one-half (1/2) of the weekly benefit
 52    amount shall be deducted from the benefits payable to the claimant.  For  pur-
 53    poses  of  this  subsection,  severance pay shall be deemed wages, even if the
                                                                        
                                           23
                                                                        
  1    claimant was required to sign a release of claims as a condition of  receiving
  2    the pay from the employer. "Severance pay" means a payment or payments made to
  3    a claimant by an employer as a result of the severance of the employment rela-
  4    tionship.
  5        (5)  Benefits payable to an individual shall be  rounded to the next lower
  6    full dollar amount.
                                                                        
  7        SECTION  15.  That Section 72-1369, Idaho Code, be, and the same is hereby
  8    amended to read as follows:
                                                                        
  9        72-1369.  OVERPAYMENTS, CIVIL PENALTIES AND  INTEREST  --  COLLECTION  AND
 10    WAIVER.  (1)  Any  person  who  received benefits to which he was not entitled
 11    under the provisions of this chapter or under an unemployment insurance law of
 12    any state or of the federal government shall be liable to repay  the  benefits
 13    and  the  benefits shall, for the purpose of this chapter, be considered to be
 14    overpayments. Overpayments shall be repaid as follows:
 15        (2)  Civil penalties. The director shall  assess  the  following  monetary
 16    penalties for each determination in which the claimant is found to have made a
 17    false statement, misrepresentation, or failed to report a material fact to the
 18    department:
 19        (a)  Twenty-five  percent (25%) of any resulting overpayment for the first
 20        determination;
 21        (b)  Fifty percent (50%) of  any  resulting  overpayment  for  the  second
 22        determination; and
 23        (c)  One hundred percent (100%) of any resulting overpayment for the third
 24        and any subsequent determination.
 25        (a3)  Any  overpayment,  civil  penalty and/or interest which has not been
 26    repaid may, in addition to or alternatively to any other method of  collection
 27    prescribed  in  this  chapter, including the creation of a lien as provided by
 28    section 72-1360, Idaho Code, be collected with interest thereon at the  statu-
 29    tory  rate  by  prescribed in section 72-1360(2), Idaho Code. The director may
 30    also file a civil action brought in the name of the state of Idaho. In  bring-
 31    ing  such  civil  actions  for  the  collection of overpayments, penalties and
 32    interest, the director shall have all the rights and remedies provided by  the
 33    laws  of  this  state, and any person adjudged liable in such civil action for
 34    any overpayments shall pay the costs of such action. Such civil actions may be
 35    commenced within the time periods specified in this section without regard  to
 36    any other statute of limitations A civil action filed pursuant to this subsec-
 37    tion  (3)  shall be commenced within five (5) years from the date of the final
 38    determination establishing liability to repay. Any judgment obtained  pursuant
 39    to  this  section  shall, upon compliance with the requirements of chapter 19,
 40    title 45, Idaho Code, become a lien of the same type, duration and priority as
 41    if it were created pursuant to section 72-1360, Idaho Code.
 42        (b4)  Collection of overpayments.
 43        (ia)   Overpayments, other than those resulting from  a  false  statement,
 44        misrepresentation,  or  failure to report a material fact by the claimant,
 45        which have not been repaid or collected, may, at  the  discretion  of  the
 46        director,  be  deducted  from  any future benefits payable to the claimant
 47        under the provisions of this chapter;.  Such  overpayments  not  recovered
 48        within  five (5) years from the date of the final determination establish-
 49        ing liability to repay may be deemed uncollectible.
 50        (iib)  Overpayments resulting from a false  statement,  misrepresentation,
 51        or  concealment of failure to report a material fact by the claimant which
 52        have not been repaid or collected shall be deducted from any benefits pay-
 53        able at any time in the future, without regard to any statute  of  limita-
                                                                        
                                           24
                                                                        
  1        tion  and  such overpayments not recovered within eight (8) years from the
  2        date of the final determination establishing liability  to  repay  may  be
  3        deemed uncollectible;.
  4             (iii) A civil action, filed pursuant to paragraph (a) of this subsec-
  5             tion,  to collect overpayments resulting from a false statement, mis-
  6             representation, or concealment of a material  fact  by  the  claimant
  7             must  be  commenced within eight (8) years from the date of the final
  8             determination establishing liability to repay;
  9        (c)  Overpayments, other than those resulting from a false statement, mis-
 10        representation or failure to report a material fact, not recovered  within
 11        five  (5) years from the date of the final determination establishing lia-
 12        bility to repay shall be deemed uncollectible, and a  civil  action  filed
 13        pursuant to paragraph (a) of this subsection, to collect such overpayments
 14        must be commenced within the same five (5) year time period;
 15        (d5)  The  director  may  waive  the  requirement to repay an overpayment,
 16    described in paragraph (c) of this subsection other than one resulting from  a
 17    false  statement,  misrepresentation,  or failure to report a material fact by
 18    the claimant, and interest thereon, if:
 19        (a)  Tthe benefit payments were made solely  as  a  result  of  department
 20        error  or  inadvertence,  and made to a claimant who had no way of knowing
 21        that he was receiving benefits to which he was not entitled could not rea-
 22        sonably have been expected to recognize the error; or if
 23        (b)  Ssuch  payments  were  made  solely  as  a  result  of  an   employer
 24        misreporting  wages  earned  in  a  claimant's  base period, and made to a
 25        claimant who could not reasonably have been expected to recognize an error
 26        in the wages reported. The director, in his sole discretion, may also com-
 27        promise a civil penalty assessed under  subsection  (2)  of  this  section
 28        and/or interest.
 29        (e)  Any judgment obtained pursuant to this section shall, upon compliance
 30        with  the  requirements of chapter 19, title 45, Idaho Code, become a lien
 31        of the same type, duration, and priority as if it were created pursuant to
 32        section 72-1360, Idaho Code.
 33        (26)  Neither the director nor any of his agents  or  employees  shall  be
 34    liable  for benefits paid to persons not entitled to the same under the provi-
 35    sions of this chapter if it appears that such payments have been made in  good
 36    faith and that ordinary care and diligence have been used in the determination
 37    of  the  validity  of  the claim or claims under which such benefits have been
 38    paid.
                                                                        
 39        SECTION 16.  That Chapter 13, Title 72, Idaho Code, be, and  the  same  is
 40    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
 41    ignated as Section 72-1372, Idaho Code, and to read as follows:
                                                                        
 42        72-1372.  CIVIL PENALTIES. (1)  The following  civil  penalties  shall  be
 43    assessed by the director:
 44        (a)  If  an  employer  willfully  fails to file any report required by the
 45        director or files a false report, a penalty equal to one  hundred  percent
 46        (100%) of the amount that would be due if the employer had filed a correct
 47        report or two hundred fifty dollars ($250), whichever is greater, shall be
 48        added  to  the  liability  of  the employer for each quarter for which the
 49        employer failed to file a report or filed a false report. For the purposes
 50        of this section, a false report includes, but is not limited to, a  report
 51        for  a  period wherein an employer pays remuneration for personal services
 52        which meets the definition of "wages" under section 72-1328,  Idaho  Code,
 53        and  the  payment  is  concealed, hidden, or otherwise not reported to the
                                                                        
                                           25
                                                                        
  1        department.
  2        (b)  If an employer, or any officer or agent or employee of  the  employer
  3        with the employer's knowledge, willfully makes a false statement or repre-
  4        sentation  or    willfully fails to report a material fact when submitting
  5        facts to the  department  concerning  a  claimant's  separation  from  the
  6        employer,  a penalty in an amount equal to ten (10) times the weekly bene-
  7        fit amount of such claimant  shall  be  added  to  the  liability  of  the
  8        employer.
  9        (c)  If  an  employer  induces, solicits, or coerces an employee or former
 10        employee to file a false or fraudulent claim for benefits under this chap-
 11        ter, a penalty in an amount equal to ten (10)  times  the  weekly  benefit
 12        amount of such employee or former employee shall be added to the liability
 13        of the employer.
 14        (d)  If  an employer fails to complete and submit an Idaho business regis-
 15        tration form, as required by section 72-1337(1), Idaho Code, a penalty  of
 16        five hundred dollars ($500) shall be assessed against the employer.
 17        (e)  For  purposes  of  paragraphs (b) and (c) of this subsection (1), the
 18        term "weekly benefit amount" means the amount calculated pursuant to  sec-
 19        tion 72-1367(2), Idaho Code.
 20        (2)  At  the  discretion  of the director, the department may waive all or
 21    any part of the penalties imposed pursuant to this  section  if  the  employer
 22    shows  to  the satisfaction of the director that it had good cause for failing
 23    to comply with the requirements of this chapter and rules promulgated thereun-
 24    der.
 25        (3)  Determinations imposing civil  penalties  pursuant  to  this  section
 26    shall  be  served in accordance with section 72-1368(5), Idaho Code. Penalties
 27    imposed pursuant to this section shall be due and  payable  twenty  (20)  days
 28    after  the  date  the  determination  was  served unless an appeal is filed in
 29    accordance with section 72-1368, Idaho Code, and rules promulgated thereunder.
 30    Such appeals shall be conducted in  accordance  with  section  72-1368,  Idaho
 31    Code, and rules promulgated thereunder.
 32        (4)  Civil  penalties  imposed by this section shall be in addition to any
 33    other penalties authorized by this chapter. The  provisions  of  this  chapter
 34    that  apply  to  the  collection  of  contributions, and the rules promulgated
 35    thereunder, shall also apply to the collection of penalties  imposed  pursuant
 36    to this section. Amounts collected pursuant to this section shall be paid into
 37    the  state employment security administrative and reimbursement fund as estab-
 38    lished by section 72-1348, Idaho Code.
                                                                        
 39        SECTION 17.  An emergency existing therefor,  which  emergency  is  hereby
 40    declared  to  exist, Sections 3, 7, 8 and 9 of this act shall be in full force
 41    and effect on and after passage and approval, and retroactively to January  1,
 42    2005.
                                                                        
 43        SECTION 18.  Sections 1, 2, 4, 5, 6, 10, 11, 12, 13, 14, 15 and 16 of this
 44    act shall be in full force and effect on and after July 1, 2005.

Statement of Purpose / Fiscal Impact


                      STATEMENT OF PURPOSE
                                
                           RS 14526c1
                                
The Idaho Legislature has frozen Unemployment Insurance (UI) tax
rates since 2002 at an average effective tax rate of 0.8%. This
freeze saved Idaho businesses over $110 million during the last
three years (2002   2004). The tax freeze ended on January 1,
2005, automatically increasing the average effective tax rate to
1.7%, a 113% increase. An increase in UI benefit payments during
the recent recession leaves Idaho's UI Trust Fund with a balance
of approximately $190 million (December 2004), down from over
$330 million in 2001. During the last two years, UI Trust Funds
in 10 other states were exhausted, forcing those states to borrow
from the Federal government to pay UI benefits. These Federal
loans will have to be repaid with interest, resulting in even
greater UI taxes in those states.

This legislation will:
Replace the 113% average tax increase in 2005 with a 12.5% Create
a new more responsive and equitable UI tax system to protect
Idaho's UI Trust Fund from insolvency;
Reduce a projected $344 million tax increase over the next six
years to an estimated $72 million; Provide UI benefit savings of
approximately $72 million over the next six years; Provide
additional tools to collect delinquent UI taxes; Increase
penalties for UI fraud; Cap the unencumbered balance of the
Workforce Development Training Fund; and make housekeeping
amendments.

A UI Study Committee appointed by Director Roger Madsen in 2002
to review Idaho's entire UI system developed this legislation.
Senator John Andreason and Representative Robert Schaefer serve
as Co-Chairs of the 17-member committee, which has broad
representation of legislators, business and organized labor. 

The legislation has an emergency clause to implement the smaller
tax increases retroactively to January 1, 2005. This is possible
because UI taxes are paid quarterly and the first quarter payment
is not due until April 30, 2005.



                         FISCAL IMPACT

There will be no impact on the State General Fund. If this
legislation is not enacted, Idaho's average effective UI tax rate
will increase by 113% in 2005 from 0.8% to 1.7%. If Idaho
experiences modest economic growth (2   2.5% annual employment
expansion), the current law will increase taxes by an estimated
$344 million over the next six years. If this legislation were
adopted, under the same economic scenario, UI taxes would
increase by approximately $72 million over the next six years.
The legislation also would provide UI benefit savings of
approximately $72 million over the next six years.




CONTACT
Name: Dwight Johnson
Agency:    Commerce and Labor, Dept. of
Phone:     841-8833


STATEMENT OF PURPOSE/FISCAL IMPACT                  H 4