Legislative auditors flag $622,000 subsidy at Idaho Bureau of Occupational Licenses

The umbrella agency that provides administrative services to 29 boards that regulate occupations from chiropractors to landscape architects to midwives and morticians is using fees collected by financially stable boards to shore up 10 boards with a negative cash balance totaling $622,000.

A Sept. 12 report on the Idaho Bureau of Occupational Licenses says the bureau and the boards they assist should balance their budgets and end the subsidies or ask the Legislature to authorize one-time fees or support from the general fund. All the boards are supported by fees from those they regulate.

“The boards with positive cash balances in the Occupational Licenses Account have been, in effect, ‘lending funds’ to cover the allocated portion of the bureau’s services and other expenses incurred by the boards with negative cash balances,” write auditors Lori Hendon and Jolene Crumley. “The boards with positive cash balances have not been given the legislative authority to spend their revenue beyond statutory obligations and normal operating expenses.”

Seven of the 10 boards with negative balances have been in the red more than three years. The management reports are prepared for the Legislature’s Joint Finance-Appropriations Committee, which writes the state’s budget.

Bureau Chief Tana Cory, who oversees what also are called “self-governing agencies,” acknowledges the figures but says the fund shifts are necessary.

“Simply stated, the current approach of using one account and one appropriation provides boards with a continuity of operations in carrying our their mandate to protect the public while ensuring stability in fees for licensees,” writes Cory in a letter responding to the audit.

Cory also noted that lawmakers have historically intended that the agencies support themselves and not seek general fund dollars. “However, if the Legislature desires, the bureau would be happy to work with it to explore a different approach.” The bureau was created in 1974.

The auditors found no other problems in the management review covering four fiscal years ending June 30, 2012.

The fund in the deepest trouble is the Athletic Commission, with a negative balance of about $178,000. Corey said the bureau recognizes a board “cannot continue to operate indefinitely with a negative balance” and cited support for this year’s House Bill 245, which will require the Athletic Commission to suspend operations until its entire debt is retired if the shortfall reaches $200,000.

The Athletic Commission regulates professional boxing, wrestling and mixed martial arts, including cage fighting. Lawmakers have resisted efforts to substantially increase fees or boost the 5 percent share the commission gets from ticket sales.

Other funds with negative balances are the Podiatry Board ($167,000), Liquefied Petroleum Gas Safety Board ($67,000), Real Estate Appraisers Board ($67,000), Midwifery Board ($55,000), Denturity Board ($28,000), Driving Businesses Licensure Board ($21,000), Naturopathic Medical Examiners Board ($20,000), Residential Care Facility Administrators Board ($12,000) and Athlete Agents Registration Board ($6,000).

On the flip side, the Cosmetology Board had $1.6 million in June 2012, accounting for more than half of the bureau’s overall $3.1 million cash balance. Other funds with over $100,000 in cash include the Drinking Water and Wastewater Professional Board, Contractors Board, Physical Therapy Licensure Board, Chiropractic Physicians Board, Acupuncture Board, Social Work Examiners Board and Architectural Examiners Board.

(The entire list of 29 boards and their fund balances is in the link to the report above.)

Dan Popkey came to Idaho in 1984 to work as a police reporter. Since 1987, he has covered politics and has reported on 25 sessions of the Legislature. Dan has a bachelor's in political science from Santa Clara University and a master's in journalism from Columbia University. He was a Congressional Fellow of the American Political Science Association and a Journalism Fellow at the University of Michigan. A former page in the U.S. House of Representatives, he graduated Capitol Page High School in 1976. In 2007, he led the Statesman’s coverage of the Sen. Larry Craig sex scandal, which was one of three Pulitzer Prize finalists in breaking news. In 2003, he won the Ted M. Natt First Amendment award from the Pacific Northwest Newspaper Association for coverage of University Place, the University of Idaho’s troubled real estate development in Boise. Dan helped start the community reading project "Big Read." He has two children in college and lives on the Boise Bench with an old gray cat.

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