Amends title IX (Employment Security Administrative Financing) of the Social Security Act (SSA) to modify the ceiling on the Federal Unemployment Account.
Provides for special distributions of funds to the States under SSA title IX.
Directs the Secretary of Labor to reserve specified amounts for grants to States to assist in implementing alternative base periods for determining the eligibility of claimants for unemployment compensation.
Requires States to achieve or make substantial progress toward achieving certain solvency targets for their unemployment compensation accounts. Directs the Secretary to transfer to other States' accounts the amount that would otherwise be transferred to the account of a State that violates such requirement under SSA title IX.
Revises SSA title IX requirements for distribution to States of certain excess amounts in the Employment Security Administration Account as of the close of FY 2002.
Amends the North American Free Trade Agreement Implementation Act to extend the self-employment assistance program.
Amends the Federal Unemployment Tax Act (FUTA) under the Internal Revenue Code to set forth requirements for treatment of short-time compensation programs.
[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1830 Introduced in House (IH)]
106th CONGRESS
1st Session
H. R. 1830
To enhance the Federal-State Extended Benefit program, to provide
incentives to States to implement procedures that will expand
eligibility for unemployment compensation, to strengthen administrative
financing of the unemployment compensation program, to improve the
solvency of State accounts in the Unemployment Trust Fund, and for
other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 17, 1999
Mr. Levin (for himself, Mr. English, Mr. Kleczka, Mr. Hilliard, Mr.
Thompson of Mississippi, Mr. Kucinich, and Ms. Schakowsky) introduced
the following bill; which was referred to the Committee on Ways and
Means
_______________________________________________________________________
A BILL
To enhance the Federal-State Extended Benefit program, to provide
incentives to States to implement procedures that will expand
eligibility for unemployment compensation, to strengthen administrative
financing of the unemployment compensation program, to improve the
solvency of State accounts in the Unemployment Trust Fund, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Unemployment Compensation Amendments
of 1999''.
SEC. 2. AMENDMENTS TO EXTENDED BENEFIT PROGRAM.
(a) Repeal of Certain State Law Requirements.--Section 202 of the
Federal-State Extended Unemployment Compensation Act of 1970 (26 U.S.C.
3304 note) is amended--
(1) by striking paragraphs (3), (4), (5), (6), and (7) of
subsection (a); and
(2) by repealing subsection (c).
(b) Establishment of Mandatory Triggers Based on Total
Unemployment.--
(1) State `on' and `off' indicators.--Subsection (d) of
section 203 of such Act is amended to read as follows:
``State `On' and `Off' Indicators
``(d) For purposes of this section--
``(1) There is a State `on' indicator for a week if--
``(A)(i) the average rate of total unemployment in
such State (seasonally adjusted) for the period
consisting of the most recent three months for which
data for all States are published before the close of
the week equals or exceeds 7.5 percent, and
``(ii) the average rate of total unemployment in
such State (seasonally adjusted) for the 3-month period
referred to in clause (i) equals or exceeds 110 percent
of such average for either (or both) of the
corresponding 3-month periods ending in the two
preceding calendar years; or
``(B) the average rate of total unemployment for
such State (seasonally adjusted) for the period
consisting of the most recent 3 months for which data
for all States are published before the close of the
week equals or exceeds 10 percent.
``(2) There is a State `off' indicator for a week unless
the requirements of subparagraph (A) or (B) of paragraph (1)
are satisfied.''.
(2) Determination of rates of total unemployment and
insured unemployment.--Subsection (e) of section 203 of such
Act is amended to read as follows:
``Determination of Rates of Total Unemployment and Insured Unemployment
``(e)(1) For purposes of this Act, determinations of the rate of
total unemployment in any State for any period (and of any seasonal
adjustments) shall be made by the Secretary.
``(2)(A) For purposes of subsection (f)(2), the rate of insured
unemployment for any thirteen-week period shall be determined by
reference to the average monthly covered employment under the State law
for the first four of the most recent six calendar quarters ending
before the close of such period.
``(B) For purposes of subsection (f)(2), the term `rate of insured
unemployment' means the percentage arrived at by dividing--
``(i) the average weekly number of individuals filing
claims for regular compensation for weeks of unemployment with
respect to the specified period, as determined on the basis of
the reports made by the State agency to the Secretary, by
``(ii) the average monthly covered employment for the
specified period.
``(C) Determinations under subsection (f)(2) shall be made by the
State agency in accordance with regulations prescribed by the
Secretary.''.
(c) Requirements for Supplemental Benefits During High Unemployment
Periods.--
(1) In general.--Subparagraph (B) of section 202(b)(3) of
such Act is amended to read as follows:
``(B) For purposes of subparagraph (A), the term `high unemployment
period' means any period during which an extended benefit period would
be in effect if--
``(i)(I) section 203(d)(1)(A)(i) were applied by
substituting `10 percent' for `7.5 percent'; and
``(II) section 203(d)(1)(B) were applied by substituting
`12.5 percent' for `10 percent'; and
``(ii) section 203(f)(1)(A)(i) were applied by substituting
`8 percent' for `6.5 percent'.''.
(2) Technical amendment.--Subsection (b) of section 202 of
such Act is amended by moving the text of paragraph (3)(A) of
such subsection 2 ems to the left.
(d) Amendments to Alternative Trigger.--Section 203(f) of such Act
is amended--
(1) in paragraph (1), by striking ``Effective with respect
to compensation for weeks of employment beginning after March
6, 1993, the'' and inserting ``In lieu of applying the
indicator specified in subsection (d)(1)(A), a'';
(2) by amending paragraph (2) to read as follows:
``(2) A State may by law provide that, for the purpose of beginning
or ending any extended period under this section, in addition to the
indicators specified in subsection (d) and paragraph (1) of this
subsection--
``(A) there is a State `on' indicator for a week if the
rate of insured unemployment under State law for the period
consisting of such week and the immediately preceding twelve weeks
equals or exceeds 6 percent; and
``(B) there is a State `off' indicator for a week if the
requirement set forth in subparagraph (A) is not satisfied.
Notwithstanding the provision of any State law described in this
paragraph, any week for which there would otherwise be a State `on'
indicator shall continue to be such a week and shall not be determined
to be a week for which there is a State `off' indicator.''.
SEC. 3. SPECIAL DISTRIBUTIONS TO THE STATES.
Section 903(a)(3) of the Social Security Act (42 U.S.C. 1103(a)(3))
is amended--
(1) in subparagraph (A) by amending clauses (i) and (ii) to
read as follows:
``(i) be subject to subparagraphs (B) and
(C), to the extent such amounts are not in
excess of the sum of--
``(I) $20,000,000, plus
``(II) the amount determined by the
Secretary of Labor to be the difference
between the amount necessary for the
proper and efficient administration of
the unemployment compensation program
for the succeeding fiscal year (taking
into account workload and other
appropriate factors) and
$2,419,000,000, and
``(ii) be subject to subparagraph (D), to
the extent such amounts are in excess of the
sum of subclauses (I) and (II) of clause
(i).'';
(2) in subparagraph (B) by striking ``(A)(i)'' and
inserting ``(A)(i)(II)'';
(3) by redesignating subparagraphs (B) and (C) as
subparagraphs (C) and (D), respectively; and
(4) by inserting after subparagraph (A) the following new
subparagraph:
``(B) The Secretary of Labor shall reserve the amount specified in
subparagraph (A)(i)(I) (at the close of fiscal years 1999, 2000, and
2001) to award grants to the States in fiscal years 2000, 2001, and
2002 to assist in the implementation of alternative base periods for
determining the eligibility of claimants. Such alternative base periods
shall reduce the period of time between the end of the base period for
a claimant and the filing of a claim for compensation. The amounts
reserved pursuant to this subparagraph shall be available to the
Secretary of Labor for obligation through fiscal year 2002.''.
SEC. 4. SOLVENCY REQUIREMENTS.
Section 903(b) of the Social Security Act (42 U.S.C. 1103(b)) is
amended by adding at the end the following new paragraph:
``(3)(A) If the Secretary of Labor finds that, as of December 31,
2001, a State has not achieved, or made acceptable progress toward
achieving, the solvency target established pursuant to subparagraph
(B), then, subject to the limitation described in subparagraph (C), the
amount available under this section for transfer to such State account
for the succeeding fiscal year shall, in lieu of being so transferred,
be transferred to the States meeting the requirements of this
subsection. The transfers shall be made to such States based on the
share of funds of each such State under subsection (a)(2), except that,
for purposes of this subparagraph, the ratio under subsection (a)(2)
shall be adjusted by excluding the wages attributable to the States
failing to meet the requirements of this subparagraph.
``(B)(i) For December 31, 2001, the solvency target shall be an
average high cost multiple of 1.0. For purposes of this subparagraph,
the average high cost multiple represents the number of years a State
could pay unemployment compensation (based on the reserve ratio of such
State) if the State paid such compensation at a rate equivalent to the
average benefit cost rate such State paid in the three calendar years
during the preceding 20 calendar years (or, if longer, during the
period consisting of the preceding three recessions as determined by
the National Bureau of Economic Research) that the benefit cost rates
were the highest. For purposes of making this determination--
``(I) the term `reserve ratio' means the ratio determined
by dividing the balance in the State account at the end of the
calendar year by the total covered wages in the State for such
year;
``(II) the term `benefit cost rate' means the rate
determined by dividing the unemployment compensation paid
during a calendar year by the total covered wages in the State
for such year; and
``(III) the ratio and rates determined under subclauses (I)
and (II) shall exclude the wages and unemployment compensation
paid by employers covered under section 3309 of the Internal
Revenue Code of 1986.
``(ii) For December 31, 2001, acceptable progress towards achieving
the solvency target shall mean that a State has reduced any difference
between 1.0 and the average high cost multiple of such State (if such
multiple is less than 1.0) that the Secretary found to exist as of
December 31, 1998, by an amount equal to or exceeding 5 percent of such
difference.
``(iii) The Secretary may adjust the solvency target specified in
clause (i), or the criteria for determining whether there is acceptable
progress towards achieving the solvency target specified in clause
(ii), for States that experience significant increases in unemployment
during the period between December 31, 1998, and December 31, 2001. The
Secretary shall establish objective criteria for making such
adjustments.
``(iv) A State shall include, as part of the annual State plan
relating to the administration of grants under this title, such
information as the Secretary may request relating to the manner in
which the State intends to achieve the solvency target established
pursuant to this paragraph.
``(C) The requirements of subparagraph (A) shall apply to excess
(referred to in subsection (a)(1)) remaining in the employment security
account at the close of fiscal year 2002 that are equal to or less than
$2,900,000,000. Such requirements shall not apply to any such excess
amounts that are greater than $2,900,000,000.''.
SEC. 5. TREATMENT OF SHORT-TIME COMPENSATION PROGRAMS.
(a) General Rule.--Section 3306 of the Internal Revenue Code of
1986 (26 U.S.C. 3306) is amended by adding at the end the following new
subsection:
``(u) Short-Time Compensation Program.--For purposes of this
chapter, the term `short-time compensation program' means a program
under which--
``(1) the participation of an employer is voluntary;
``(2) an employer reduces the number of hours worked by
employees in lieu of temporary layoffs;
``(3) such employees whose workweeks have been reduced by
at least 10 percent are eligible for unemployment compensation;
``(4) the amount of unemployment compensation payable to
any such employee is a pro rata portion of the unemployment
compensation which would be payable to the employee if such
employee were totally unemployed;
``(5) such employees are not required to meet the
availability for work or work search test requirements while
collecting short-time compensation benefits, but are required
to be available for their normal workweek;
``(6) eligible employees may participate in an employer-
sponsored training program to enhance job skills if such
program has been approved by the State agency;
``(7) the State agency may require an employer to continue
to provide health benefits, and retirement benefits under a
defined benefit pension plan (as defined in section 414(j)) to
any employee whose workweek is reduced pursuant to the program
as though the workweek of such employee had not been reduced;
``(8) the State agency may require an employer (or an
employers' association which is party to a collective
bargaining agreement) to submit a written plan describing the
manner in which the requirements of this subsection will be
implemented and containing such other information as the
Secretary of Labor determines is appropriate; and
``(9) the program meets such other requirements as the
Secretary of Labor determines are appropriate.''.
(b) Conforming Amendments.--
(1) Subparagraph (E) of section 3304(a)(4) of such Code (26
U.S.C. 3304(a)(4)(E)) is amended to read as follows:
``(E) amounts may be withdrawn for the payment of
short-time compensation under a short-time compensation
program (as defined under section 3306(u));''.
(2) Paragraph (5) of section 3306(f) of such Code (26
U.S.C. 3306(f)(5)) is amended to read as follows:
``(5) amounts may be withdrawn for the payment of short-
time compensation under a short-time compensation program (as
defined under subsection (u)); and''.
(3) Section 303(a)(5) of the Social Security Act (42 U.S.C.
503(a)(5)) is amended by striking ``the payment of short-time
compensation under a plan approved by the Secretary of Labor''
and inserting ``the payment of short-time compensation under a
short-time compensation program (as defined in section 3306(u)
of the Internal Revenue Code of 1986)''.
SEC. 6. EFFECTIVE DATE.
(a) In General.--Except as provided in subsection (b), the
provisions of this Act shall take effect on the date of enactment of
this Act.
(b) Extended Benefit Amendments.--
(1) Except as provided in paragraph (2), the provisions of
section 2 of this Act shall take effect for the weeks beginning
on or after October 1, 2002.
(2) Pursuant to the enactment of appropriate provisions of
the State law, the provisions of section 2 may, with respect to
such State, take effect for weeks which begin earlier than the
weeks specified in paragraph (1), but not earlier than 60 days
after the date of enactment of this Act.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
Referred to the Subcommittee on Human Resources.
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