Idaho Department of Labor seeks $7.33 million in dedicated authority to stabilize unemployment operations as federal funding drops

The Idaho Department of Labor asked the Joint Finance-Appropriations Committee for increased dedicated-fund spending authority and described the state unemployment-insurance trust fund as solvent but subject to federal grant variability.

Janie Rivera, director of the Idaho Department of Labor, told the committee the department is requesting $7,330,000 in dedicated-fund authority for unemployment-insurance operations to offset a drop in federal grant funding and to avoid sudden staffing gaps. Rivera said the request is not for general fund.

Why it matters: the department administers unemployment benefits and an under-resourced UI adjudication system can delay benefits or appeals processing; lawmakers pressed for data on staffing, spending and long-term trust-fund health.

What the request would do

Rivera said the department received large federal grants during the pandemic and added staff (about 100 positions at the peak) to handle the surge of claims. As pandemic-era federal funding declines, the department must use dedicated state funds to maintain baseline operations so it can ramp up quickly in a recession. Rivera said the $7.33 million request would fund existing staff costs moved from expiring federal grants into the department’s dedicated funds.

Dupree, the committee analyst, explained a proposed cash transfer: the department requested a $4,868,600 transfer from the unemployment penalty-and-interest fund back to the employment-security fund to correct prior over-transfers and to restore the agency’s continuously appropriated fund balances.

Trust fund size and contingency options

Rivera described Idaho’s UI trust fund as “about a billion dollar trust fund” and said statutory mechanisms and tax rate calculations are intended to keep the fund solvent for severe recessions. She told the committee if the trust fund were exhausted the state could borrow from the federal government or issue bonds, and the department would not come to the legislature seeking general fund to pay benefits.

Lawmakers asked for more data on staffing and spending

Senators and representatives asked for details the department did not have on hand: the committee requested (a) how much salary savings have been spent vs. reverted, (b) the department’s baseline staffing by program and fluctuation ranges during recessions, and (c) specifics on the federal grant calculations that determine the department’s annual federal funding levels. Rivera and the analyst offered to follow up with written numbers and a short fact sheet.

Key program facts discussed

- The department’s filled FTE percentage was reported at about 73% historically (the appropriation includes flexibility to hire quickly in downturns). - Recent annual claim-payment volumes varied widely: trustee-and-benefit payouts ranged from about $69.7 million in a low year to roughly $202 million in COVID years, the analyst said. - Benefit-duration rules are set in statute and fluctuate with the state unemployment rate; Rivera summarized Idaho’s range as 20 to 26 weeks (with the current statutory level at 21 weeks given 3.7% unemployment) and an average weekly benefit noted at roughly $434.

Committee directions and follow-ups

Lawmakers requested that the department provide to the committee: baseline staffing numbers by program, historic staffing changes during the pandemic peak, an explanation of how much of salary savings were reinvested vs. reverted, and a concise fact sheet describing benefit duration, tax-rate calculation basics and trust-fund contingencies. The department agreed to supply that material.

Administration recommendation

The analyst reported the governor recommends the department’s enhancements, including the $7.33 million dedicated-fund request, a $161,000 OITS hardware request, and the proposed balance adjustments and transfers that the department sought to align fund balances.

Attribution

This account is based on statements recorded in the committee transcript by Brooke Dupree (budget and policy analyst, Legislative Services Office) and Janie Rivera (director, Idaho Department of Labor), and follow-up remarks from department staff present at the hearing.