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Idaho Department of Labor seeks dedicated-fund authority as federal UI grants decline
Summary
The Department of Labor asked the Joint Finance-Appropriations Committee for increased spending authority from dedicated unemployment funds to maintain operations as federal UI grant funding decreases and to allow staffing stability ahead of potential economic downturns.
The Joint Finance-Appropriations Committee reviewed the Idaho Department of Labor's fiscal request and heard agency testimony that federal grants supporting unemployment insurance (UI) operations have declined since the pandemic. Director Janie Rivera told the committee the department is asking for additional spending authority from dedicated funds to preserve existing operations rather than use general fund.
Director Rivera said federal pandemic-era grants that helped sustain expanded UI operations have decreased and that the department needs roughly $7.33 million in additional dedicated-fund spending authority in fiscal 2026 so it can continue core claims determinations, appeals and compliance work while avoiding sudden staffing changes. Rivera said the department is not asking for general fund for UI services and that the requested authority would be used to continue existing staff assignments rather than hire new positions.
The committee also discussed a requested internal cash transfer: the department seeks to transfer $4,868,600 from the unemployment penalty and interest fund back to the Employment Security Fund to correct an overtransfer tied to statutory accounting thresholds. Brooke Dupree (budget analyst) explained the transfer would lower the agency's projected ending fund balance and adjust receipts and transfers shown in the agency's consolidated fund analysis.
Trust fund and contingency explanation: Director Rivera described the state's UI trust fund as large and generally solvent. "Mister chairman, so we have about a billion dollar trust fund," Rivera said, adding that Idaho's trust fund now contains a buffer intended to cover multi-year stress and that if the trust fund were exhausted in a severe recession the state could borrow from the federal government or issue bonds as permitted under statute.
Committee questions focused on staffing levels, the department's baseline head count, and how much the department's FTP and salary savings are being spent rather than reverted. Rivera and staff said they would follow up with more precise staffing and budget-details to support the $7.33 million request. Committee members asked for numbers showing baseline staffing, pandemic peak staffing increases and what sustained increases (if any) are needed because of growth in Idaho businesses and compliance workload.
Other items discussed: the department requested $161,000 for OITS hardware (70 laptops/docking stations and 70 desktops) and included several fund-balance adjustments and reappropriation language in the packet. The governor recommended the enhancements; no committee vote took place during the presentation.
The committee asked the department to provide a staffing breakdown and a clearer three- to five-year projection of federal grant expectations, so the panel can assess whether requested dedicated-fund authority should be temporary or ongoing.
