Wary of ‘federal bullying,’ Idaho House kills FBI background check bill

BOISE - The Idaho House on Monday killed legislation allowing FBI background checks on certain state employees.

The bill’s sponsor warned that the state could lose millions of dollars the state Department of Labor relies on to pay federal unemployment benefits.

Rep. Heather Scott, R-Blanchard, decried the bill as “federal bullying,” and Rep. Lynn Luker, R-Boise, questioned whether it was too broadly worded. Rep. Dorothy Moon, R-Stanley, declared, “I have a real issue with data collection being obtained in the state.”

Georgia Smith, spokeswoman for the state Department of Labor, said late Monday, “We are trying to move as quickly as possible to review our options and come up with an alternative.”

The bill would have authorized the department to conduct FBI fingerprint-based background checks, which include a 50-state criminal record check, citizenship verification, and local law enforcement checks everywhere the employee has lived, work or attended school in the past five years, on employees, applicants, contractors, interns and others. Those checks are required by the IRS for any employee who has access to confidential taxpayer information that taxpayers provide to the IRS when they file their taxes.

Smith said the legislation doesn’t address data collection. “It’s about protecting everybody’s federal tax information,” she said, “and making sure that the people who have access to that data have cleared an FBI fingerprint-based background check.”

The department currently has 26 employees who have access to that data as part of the Treasury Offset Program, which goes after unemployment overpayments that occur through fraud or misrepresentation by putting a hold on the taxpayer’s income tax refund. Participation in that offset program is mandatory for all states; since 2013, Idaho has recovered $9.5 million in overpayments.

Rep. Eric Redman, R-Athol, the House sponsor of the bill, said, “This is an immediate need to conduct checks on employees with access to taxpayers’ information.”

He said the department must show by next November that it has statutory authority to conduct the FBI background checks in order to continue using the program. A federal grant will cover the department’s $10,910 equipment cost to conduct the new checks, he said.

Moon said, “Yes, it might be grant money, tax money, but we also pay federal taxes. There’s no line between where the tax money is coming from, so that’s why I’m voting no.”

Scott told the House, “There were a lot of problems I saw with this bill. It’s an example of federal bullying. It is a huge expansion of power by the Department of Labor which includes very broad language.”

She also objected to clauses in the bill absolving the department of liability, and said, “There are other ways to collect this information without taking this federal grant to get this machine and expand who they’re doing background checks on.”

Redman said, “Before conducting any FBI fingerprint-based checks for the department, the FBI requires states to have statutory authority, which is what HB 164 provides.” But the bill failed on a 27-43 vote.

Failure to comply with the background-check requirement could potentially jeopardize millions in federal funding that Idaho receives to administer its unemployment benefit program; last year, Idaho received $13.8 million. Smith said, “The worst possible scenario would be … we might lose access to those funds.”