Bringing the Economy Home

Governor Otter: The State Can’t Reject a Federal Unemployment Benefit Extension

Department of Labor / State of Idaho

Roger Madsen is Director of the Idaho Department of Labor

The Idaho Department of Labor estimates about 1,500 people would lose their weekly unemployment payment immediately if federal benefits are allowed to expire at the end of the month.  Additionally, the department estimates about 300 Idahoans would drop off the federal program every week through mid-June.

Extended benefits for the long-term unemployed are tangled in the Congressional debate over the payroll tax cut.  It’s not getting as much press, but if the benefits aren’t extended, it could impact thousands of Idahoans and five million Americans.

Today, the House rejected the Senate-approved plan to extend the unemployment benefits for two months, still, Congress has until December 31st to come to an agreement.

The Idaho Department of Labor has already sent out this press release, which assumes an agreement won’t happen before the year-end deadline.

Back in November, Idaho Department of Labor Director Roger Madsen urged Idaho’s Congressional delegation to vote against any further extension of unemployment benefits.  Madsen, with support from Governor Butch Otter, said jobless Idahoans would be more encouraged to find a job if extended benefits came to an end.  Madsen wrote, “If Washington, D.C. votes to extend benefits, I am confident Idaho’s Legislature and our Governor will refuse to accept them.”

But it’s unclear if the state has the authority to reject a federal extension of unemployment benefits.  Governor Otter said in a recent interview the state could not reject the benefits.  However, one legislative staffer has said the state may have room to deny funds.  The answer seems to vary depending on who you talk to, and whether the state can reject federal extended benefits could also depend on how Congress writes their legislation.

Click play to hear our full conversation with Gov. Otter on unemployment benefits:

Aaron Kunz / Boise State Public Radio

Gov. Butch Otter speaking with Emilie Ritter Saunders on Dec. 13, 2011

Q: You said unemployment benefits aren’t a sure thing and that’s never been more apparent than now. Who knows what’s going to happen with an extension of benefits?

A: Now remember this. If there is another extension, that money’s got to come from some place. And if Washington D.C. has to make a decision between another 12 weeks of unemployment or paying the Medicaid bills, or do they borrow the money? And how much more interest is there going to be on $16 trillion dollars as compared to $15 trillion dollars, right? And can we even sell the bonds? Or sell the bonds at a reasonable price? Because the more debt we get into, the higher our price goes for the last dollar borrowed. But all those things have to be considered. You don’t make these decisions in a vacuum.

Q: If benefits are extended at the federal level, would the state or does the state have any authority to say ‘we’re not going to have any part of that’?

 A: If they’re extended, no.

Q: You have to accept whatever they do?

A: Right.

Q: Are you okay with that?

A: Well, I would prefer that we didn’t borrow any more money. I just like to keep the promises made, and I would also like to encourage an environment that says to people either go take that entry level job and start a new career if that’s necessary. And there’s plenty of facilities to do that. We should all be amazed at the growth of the College of Western Idaho. It’s the fastest growing community college in the history of the United States.  Nine thousand, two hundred full-time students. Seventeen thousand of these part-time students that have lost the job doing whatever they’re doing, going back to school and finding out a new skill so they can get back into a marketable skill that’s demanded in the job market.


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