110 HR 2806 IH: Safety Net Enhancement Act
U.S. House of Representatives
2007-06-21
text/xml
EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
1.Short title; table of
contents
(a)This Act may be cited as the Safety Net Enhancement Act
.
(b)The table of contents is as follows:
Sec. 1. Short title; table of contents.
Title I—Administrative Reforms
Sec. 101. Extended benefits trigger.
Sec. 102. Increase and decrease in earnings credited to State
accounts when States meet or fail to meet funding goals.
Sec. 103. Interest-free advances to State accounts in
Unemployment Trust Fund restricted to States which meet funding
goals.
Sec. 104. State collection of Federal unemployment
tax.
Sec. 105. Required distribution of State-specific information
packets.
Title II—Repeal of tax on unemployment compensation
Sec. 201. Repeal of tax on unemployment
compensation.
Title III—Safety Net Review Commission
Sec. 301. Establishment.
Sec. 302. Function.
Sec. 303. Members.
Sec. 304. Staff and other assistance.
Sec. 305. Compensation.
Sec. 306. Report.
Sec. 307. Termination.
<enum>I</enum><header>Administrative
Reforms</header>
<section display-inline="no-display-inline" id="H8B7D6B8EBFA440E0887C92A34740529E" section-type="subsequent-section"><enum>101.</enum><header>Extended benefits
trigger</header>
<subsection id="H9C68A1FB52684A4AA188606BC7661995"><enum>(a)</enum><header>In
general</header><text>Section 203(d) of the Federal-State Extended Unemployment
Compensation Act of 1970 (<external-xref legal-doc="usc" parsable-cite="usc/26/3304">26 U.S.C. 3304</external-xref> note) is amended—</text>
<paragraph id="HD5A5C096CD864BC2A83FAC186388942E"><enum>(1)</enum><text>in subparagraph
(B) of paragraph (1), by striking <quote>5 per centum</quote> and inserting
<quote>4 per centum</quote>, and</text>
</paragraph><paragraph id="H0E357DC17DC145019B79ED13D9D36204"><enum>(2)</enum><text>in the first flush
sentence following paragraph (2), by striking <quote>5</quote> and inserting
<quote>4</quote>.</text>
</paragraph></subsection><subsection id="H038BFC20ECCB4261BF62E124BB30C2A8"><enum>(b)</enum><header>Effective
date</header><text>The amendments made by subsection (a) shall apply to weeks
of unemployment beginning 6 months or more after the date of the enactment of
this Act.</text>
</subsection></section><section id="H63841F7949CE49AA8CAAE6595FA8E727"><enum>102.</enum><header>Increase and
decrease in earnings credited to State accounts when States meet or fail to
meet funding goals</header>
<subsection id="HBE963CA12B0740FF8BA16759BA7BBF1"><enum>(a)</enum><header>In
general</header><text>Section 904 of the <act-name parsable-cite="SSA">Social
Security Act</act-name> (<external-xref legal-doc="usc" parsable-cite="usc/42/1104">42 U.S.C. 1104</external-xref>) is amended by adding at the end the
following new subsection:</text>
<quoted-block act-name="Social Security Act" id="H92ACB1C4B48545A18587AD4F20B245A4" style="traditional">
<subsection id="HB6B0426FDF90414EBFC3B701C4B4091C"><enum>(h)</enum><header>Increase and
decrease in amount of earnings allocated to state accounts when states meet or
fail To meet funding goals</header><paragraph commented="no" display-inline="yes-display-inline" id="H61211B102973434EABDAC15E7F8FCEB0"><enum>(1)</enum><text>If the average daily
balance in a State account in the Unemployment Trust Fund for any calendar
quarter exceeds the funding goal of such State, the amount otherwise creditable
to such account under subsection (e) for such quarter shall be increased by the
interest premium on such excess. If the average daily balance in such a State
account for any calendar quarter is less than the funding goal of such State,
the amount otherwise creditable to such account under subsection (e) for such
quarter shall be decreased by the interest penalty.</text>
</paragraph><paragraph id="HB9D3E03FDBAB46A7BE9BF9C731DD60AC" indent="up1"><enum>(2)</enum><text>Paragraph (1) shall not apply with
respect to any interest premium or interest penalty to the extent that such
application would result in an increase or decrease of more than $2,500,000 in
the amount creditable to any State account for any calendar quarter.</text>
</paragraph><paragraph id="H728F1158A8D44D75A0B8B1C713DD7400" indent="up1"><enum>(3)</enum><text>For purposes of this subsection, the
term <term>interest premium</term> means, for any calendar quarter—</text>
<subparagraph id="H7C2EEC9B4A324693AB67F677D036BC49"><enum>(A)</enum><text>with respect to the State with the
largest percentage value of excess of the average daily balance in the State
account in the Unemployment Trust Fund over the funding goal of such State,
one-half of one percent of the amount of such excess, and</text>
</subparagraph><subparagraph id="HC2DF37F129F14922A2BF822EFC35C4B8"><enum>(B)</enum><text>with respect to each other State, the
product of—</text>
<clause id="HA0F633E807104F75A85BC6A7CE9EF436"><enum>(i)</enum><text>the amount of the excess of the
average daily balance in the State account in the Unemployment Trust Fund over
the funding goal of such State, and</text>
</clause><clause id="HC62E9880FE1A478B8594EF879637FA4"><enum>(ii)</enum><text>the percentage which bears the
same ratio to one-half of one percent as—</text>
<subclause id="HEA3A13F1E6044018BCED39CB19D82B5"><enum>(I)</enum><text>the percentage value of such excess,
bears to</text>
</subclause><subclause id="HBC8416F765D14D549189F5FA2B2B465C"><enum>(II)</enum><text>the percentage value of the excess of
the State referred to in subparagraph (A).</text>
</subclause></clause></subparagraph></paragraph><continuation-text continuation-text-level="subsection">The
Secretary shall make appropriate adjustments in the interest premium for any
calendar quarter if the aggregate interest premiums payable for such quarter
exceed the aggregate interest penalties for such quarter.</continuation-text><paragraph id="HE94E606EB818432FA37C94DE55B36D2E" indent="up1"><enum>(4)</enum><text>For purposes of this subsection, the
term <term>interest penalty</term> means, for any calendar quarter—</text>
<subparagraph id="H3746A0079A984576ABE474748B1140DA"><enum>(A)</enum><text>with respect to the State with the
largest percentage value of excess of the funding goal of such State over the
average daily balance in the State account in the Unemployment Trust Fund,
one-half of one percent of the amount otherwise creditable to such account
under subsection (e), and</text>
</subparagraph><subparagraph id="H5C622BBA37E54B2BA2B162624200BF1"><enum>(B)</enum><text>with respect to each other State, the
product of—</text>
<clause id="HD83EC8B91980428DB4D39C93B0C24F21"><enum>(i)</enum><text>the amount otherwise creditable to
such account under subsection (e), and</text>
</clause><clause id="H60D3291D0BAA4D3586944837282590D7"><enum>(ii)</enum><text>the percentage which bears the
same ratio to one-half of one percent as—</text>
<subclause id="HE4C9C0CCE81D4ED0A0B8D04200E9E612"><enum>(I)</enum><text>the percentage value of the excess of the
funding goal of the State over such average daily balance of such State, bears
to</text>
</subclause><subclause id="H64DE4A46BB1D47BA86C7FD423F7D11AD"><enum>(II)</enum><text>the percentage value of such excess of
the State referred to in subparagraph (A).</text>
</subclause></clause></subparagraph></paragraph><paragraph id="HAA43AE1048254D2DBA748C009498A316" indent="up1"><enum>(5)</enum><text>For purposes of this subsection, the
term <term>funding goal</term> means, for any State for any calendar quarter,
the average of the unemployment insurance benefits paid by such State during
each of the 3 years, in the 20-year period ending with the calendar year
containing such calendar quarter, during which the State paid the greatest
amount of unemployment benefits.</text>
</paragraph><paragraph id="H0C07E05E163D4D518943330054A0479" indent="up1"><enum>(6)</enum><text>For purposes of this subsection, the
term <term>percentage value</term> means—</text>
<subparagraph id="H4C4396223DC646DC92C3E050073FF23"><enum>(A)</enum><text>with respect to any excess of the
average daily balance in a State account in the Unemployment Trust Fund over
the funding goal of such State, the percentage which such excess bears to such
funding goal, and</text>
</subparagraph><subparagraph id="HB3A18EB22866481C8D9F498DBEB262BB"><enum>(B)</enum><text>with respect to any excess of such
funding goal over such average daily balance, the percentage which such excess
bears to such funding
goal.</text>
</subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H27F303C4A0714B959EA2A69F835674C2"><enum>(b)</enum><header>Conforming
amendments</header>
<paragraph id="HD7B0F4A6979C461DBA682441ED728B12"><enum>(1)</enum><header>Amounts credited
to State accounts</header><text>Subsection (e) of section 904 of the
<act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C.
1104(e)) is amended in the first sentence by inserting <quote>(as modified by
subsection (h))</quote> after <quote>a proportionate part</quote>.</text>
</paragraph><paragraph id="H32089FBE42974CE480F3E62306C67700"><enum>(2)</enum><header>Interest rate on
repayment of advances determined without regard to interest premiums or
penalties on amounts credited to state accounts</header><text>Subparagraph (A)
of section 1202(b)(4) of such Act (<external-xref legal-doc="usc" parsable-cite="usc/42/1322">42 U.S.C. 1322(b)(4)</external-xref>) is amended by
inserting <quote>(determined without regard to section 904(h))</quote> after
<quote>preceding calendar year</quote>.</text>
</paragraph></subsection><subsection id="H5700E5B39C8A4BE3B8D29BE05C08929"><enum>(c)</enum><header>Report</header><text>Not
later than 6 months after the date of the enactment of this Act, the Secretary
of Labor shall submit to the Congress a report recommending sources of funding
for the crediting of interest premiums under subsection (h) of section 904 of
the <act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C.
1104), as added by this section, in the event that the imposition of interest
penalties under such subsection is insufficient to fund such premiums.</text>
</subsection><subsection id="H09D3482A5F3F44B8BB5256DBEA767186"><enum>(d)</enum><header>Effective
Date</header><text>The amendments made by this section shall apply to calendar
years beginning after December 31, 2010.</text>
</subsection></section><section id="H2377818C918C4161A631FB004FA2B0A0"><enum>103.</enum><header>Interest-free
advances to State accounts in Unemployment Trust Fund restricted to States
which meet funding goals</header>
<subsection id="H358CC465479241F8A6CAFA0045E49232"><enum>(a)</enum><header>In
general</header><text>Subparagraph (C) of section 1202(b)(2) of the
<act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C.
1322(b)(2)) is amended to read as follows:</text>
<quoted-block act-name="Social Security Act" id="H3D03D15F903846BFA101F73F291900F3" style="OLC">
<subclause id="HBB42BDD6D1704A0C81C6A200E230776C" indent="up3"><enum>(C)</enum><text>the average daily balance in the
account of such State in the Unemployment Trust Fund for each of 4 of the 5
calendar quarters preceding the calendar quarter in which such advances were
made exceeds the funding goal of such State (as defined in section
904(h)).</text>
</subclause><after-quoted-block></after-quoted-block></quoted-block>
</subsection><subsection id="H071B07D121044111A14444CEFD2E0671"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by subsection (a) shall apply to calendar
years beginning after the date of the enactment of this Act.</text>
</subsection></section><section id="H6C9DC71C72DE466FA7DCC8665BD9BB1"><enum>104.</enum><header>State collection
of Federal unemployment tax</header>
<subsection id="H6EDF587316CB4FC800D5393ABC856CF"><enum>(a)</enum><header>In
General</header><text><external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/23">Chapter 23</external-xref> of the Internal Revenue Code of 1986 (relating
to Federal Unemployment Tax Act) is amended by redesignating section 3311 as
section 3312 and by inserting after section 3310 the following new
section:</text>
<quoted-block id="HEAB7BBC3DCA44F9687E61EE1A5800200" style="OLC">
<section id="HB0B97C6983C840EC95B4F2360929224E"><enum>3311.</enum><header>State
collection of tax</header>
<subsection id="H42791B841D1D4B56B3D7B04ED105401B"><enum>(a)</enum><header>In
general</header><text>At the election of any State which is certified as
provided in section 3304, each employer who pays contributions, with respect to
any wages, into an unemployment fund maintained under the unemployment
compensation law of such State shall submit the tax imposed by this chapter
with respect to such wages to such State rather than to the Secretary.</text>
</subsection><subsection id="HDD6EF768252647D288B378AFB998002F"><enum>(b)</enum><header>Coordination
with depositary requirements</header><text>Payment under subsection (a) of the
tax imposed by this chapter with respect to any wages shall be treated as
timely paid for purposes of this title if paid by the employer to the State at
the same time as a timely paid payment, with respect to such wages, of
contributions into an unemployment fund maintained under the unemployment
compensation law of such State.</text>
</subsection><subsection id="H06FEFE2710A04B5F851B98ADF939079F"><enum>(c)</enum><header>Exception for
payments not timely paid</header><text>Subsection (a) shall not apply to any
payment of the tax imposed by this chapter which is not paid by an employer on
or before the last date on which such payment would be treated as timely paid
under subsection (b).</text>
</subsection><subsection id="H928714C6EE57413397802E00AE16F06B"><enum>(d)</enum><header>Federal tax
transferred to Secretary</header><text>Each State making an election under
subsection (a) shall transmit to the Secretary, at the time and in the manner
prescribed by the Secretary, the amount of the tax imposed by this chapter
which is submitted to such State under subsection (a) and a copy of the State
tax return of each employer making such a submission. The Secretary may, after
consultation with such organizations or other entities as the Secretary
considers appropriate, prescribe regulations requiring that additional
information be submitted by such State with respect to the amount of such tax
payable by such
employer.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HA3927E5C595D4F558D2F42815DBBD87"><enum>(b)</enum><header>Clerical
amendment</header><text>The table of sections for chapter 23 of such Code is
amended by striking the item relating to section 3311 and inserting the
following new items:</text>
<quoted-block id="H2C48DC75A2D3474683D31D71BB1ECC9C" style="OLC">
<toc regeneration="no-regeneration">
<toc-entry level="section">Sec. 3311. State collection of
tax.</toc-entry>
<toc-entry level="section">Sec. 3312. Short
title.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H1A8D81EB5CD0429E8F0088B477C640D"><enum>(c)</enum><header>Effective
Date</header><text>The amendments made by this section shall apply to taxable
years beginning after December 31, 2007.</text>
</subsection></section><section id="HF40BC20D57F34CA9BFC7A805EA93C09E"><enum>105.</enum><header>Required
distribution of State-specific information packets</header>
<subsection id="HE736147DDFBF4D5CA81BE1A9D3EA1D2E"><enum>(a)</enum><header>In
General</header><text>Subsection (a) of section 3304 of the Internal Revenue
Code of 1986 (relating to approval of State laws) is amended by striking
<quote>and</quote> at the end of paragraph (18), by striking the period at the
end of paragraph (19) and inserting <quote>; and</quote>, and by adding at the
end the following new paragraph:</text>
<quoted-block id="H3F4F9171EE7341B7AFF034D076B69EE3" style="OLC">
<paragraph id="H19DA621168064D3CB32489B587E0FDCB"><enum>(20)</enum><text>the State will
distribute to unemployed individuals State-specific information packets
explaining unemployment insurance eligibility
conditions.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HBF8068C5A15546A8A3C4447C9C13FC85"><enum>(b)</enum><header>Effective
Date</header><text>The amendment made by subsection (a) shall apply to
certifications of States for 2008 and thereafter, except that section
3304(a)(20) of the Internal Revenue Code of 1986, as added by subsection (a),
shall not be a requirement for the State law of any State prior to July 1,
2009, if the legislature of such State does not meet in a regular session which
closes during the calendar year 2008.</text>
</subsection></section><enum>II</enum><header>Repeal of tax on
unemployment compensation</header>
<section id="HDACBA011C7B8443A86B967495E807BB3"><enum>201.</enum><header>Repeal of tax
on unemployment compensation</header>
<subsection id="HD831AB409CAB434DAB215872159B90F9"><enum>(a)</enum><header>In
general</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/85">Section 85</external-xref> of the Internal Revenue Code of 1986 is hereby
repealed.</text>
</subsection><subsection id="HE6ED90F84CAE4B2A97160645F1DCC0C8"><enum>(b)</enum><header>Conforming
amendments</header>
<paragraph id="H538A731F23BA4D538EA94CC9DEAD2E4C"><enum>(1)</enum><text>Subsection (p) of
section 3402 of such Code is amended by striking paragraph (2) and by
redesignating paragraph (3) as paragraph (2).</text>
</paragraph><paragraph id="H2B2D47BEFE4D437D8F355526F3E100F3"><enum>(2)</enum><text>Section 6050B of
such Code (relating to returns relating to unemployment compensation) is hereby
repealed.</text>
</paragraph><paragraph id="HC5CC12E9923E4AD4A33691E1FBE177FE"><enum>(3)</enum><text>The table of
sections for part II of subchapter B of chapter 1 of such Code is amended by
striking the item relating to section 85.</text>
</paragraph><paragraph id="HB69C976957814CEBAC2E71D44100CD2D"><enum>(4)</enum><text>The table of
sections for subpart B of part III of subchapter A of chapter 61 of such Code
is amended by striking the item relating to section 6050B.</text>
</paragraph></subsection><subsection id="H6584BD77065C4255BBCBA74CFE9EEBB6"><enum>(c)</enum><header>Effective
date</header><text>The amendments made by this section shall apply to amounts
received after December 31, 2007.</text>
</subsection></section><enum>III</enum><header>Safety Net Review
Commission</header>
<section id="H5106CDFEE9A5421399FBF334EB87A427"><enum>301.</enum><header>Establishment</header><text display-inline="no-display-inline">The Secretary of Labor shall establish an
advisory commission to be known as the <quote>Safety Net Review
Commission</quote> (hereinafter in this title referred to as the
<quote>Commission</quote>).</text>
</section><section commented="no" id="H248729DEFEB140A4A71BC0CC4E308557"><enum>302.</enum><header>Function</header><text display-inline="no-display-inline">It shall be the function of the Commission
to evaluate the unemployment compensation program, the Trade Adjustment
Assistance program, the Job Corps program, a program under the Workforce
Investment Act, and other employment assistance programs, including the
purpose, goals, countercyclical effectiveness, coverage, benefit adequacy,
trust fund solvency, funding of State administrative costs, administrative
efficiency, and any other aspects of each such program, as well as any related
provisions of the Internal Revenue Code of 1986, and to make recommendations
for their improvement.</text>
</section><section id="HDC99E308078D4008983DF7EFAA68205C"><enum>303.</enum><header>Members</header>
<subsection id="HBF4794C9A70E48D6865CFB8100E4595F"><enum>(a)</enum><header>In
general</header><text>The Commission shall consist of 11 members as
follows:</text>
<paragraph id="H899F8646F15D45A60040B226F21EF6BE"><enum>(1)</enum><text>5
members appointed by the President, to include representatives of business,
labor, State government, and the public.</text>
</paragraph><paragraph id="HCEAA87A1743E40CEAA62FEEE36396B00"><enum>(2)</enum><text>3
members appointed by the President pro tempore of the Senate, in consultation
with the Chairman and ranking member of the Committee on Finance of the
Senate.</text>
</paragraph><paragraph id="HA1CA0EB786F747E7B4F5E0E03500001E"><enum>(3)</enum><text>3
members appointed by the Speaker of the House of Representatives, in
consultation with the Chairman and ranking member of the Committee on Ways and
Means of the House of Representatives.</text>
</paragraph></subsection><subsection id="H74C5BFA1534D4DCD87FBE784EF960050"><enum>(b)</enum><header>Qualifications</header><text>In
appointing members under paragraphs (2) and (3) of subsection (a), the
President pro tempore of the Senate and the Speaker of the House of
Representatives shall each appoint—</text>
<paragraph id="HD9AF022803FA438283592906DF543C3D"><enum>(1)</enum><text>1
representative of the interests of business,</text>
</paragraph><paragraph id="HA3C1C13EB1684C99B1E3EB40116CE0C3"><enum>(2)</enum><text>1
representative of the interests of labor, and</text>
</paragraph><paragraph id="H6D31591C39174FB09CBC73BE6FCFA491"><enum>(3)</enum><text>1
representative of the interests of State governments.</text>
</paragraph></subsection><subsection id="H4125DD92507C4B20824E3565846EF7C"><enum>(c)</enum><header>Vacancies</header><text>A
vacancy in the Commission shall be filled in the manner in which the original
appointment was made.</text>
</subsection><subsection id="HC888597173AE405D9DA600C3B7F2E920"><enum>(d)</enum><header>Chairman</header><text>The
President shall appoint the Chairman of the Commission from among its
members.</text>
</subsection></section><section id="H436BF97947C44650B78BB572AC5F6B1"><enum>304.</enum><header>Staff and other
assistance</header>
<subsection id="HEC3DF203575C4D9F863DFD794FC78F7"><enum>(a)</enum><header>In
general</header><text>The Commission may engage any technical assistance
(including actuarial services) required by the Commission to carry out its
functions under this title.</text>
</subsection><subsection id="H128242CA06714E34983812B78061DD2B"><enum>(b)</enum><header>Assistance from
Secretary of Labor</header><text>The Secretary of Labor shall provide the
Commission with any staff, office facilities, and other assistance, and any
data prepared by the Department of Labor, required by the Commission to carry
out its functions under this title.</text>
</subsection></section><section id="HD6357AA07C5646CCA578742BCA42DC41"><enum>305.</enum><header>Compensation</header><text display-inline="no-display-inline">Each member of the Commission—</text>
<paragraph id="H8FBF641F6220405B872EFC6F94499858"><enum>(1)</enum><text>shall be entitled
to receive compensation at the rate of pay for level V of the Executive
Schedule under <external-xref legal-doc="usc" parsable-cite="usc/5/5316">section 5316</external-xref> of title 5, United States Code, for each day
(including travel time) during which such member is engaged in the actual
performance of duties vested in the Commission; and</text>
</paragraph><paragraph id="H7E02DBDB5D7246F492F4B3C3557FCE6B"><enum>(2)</enum><text>while engaged in
the performance of such duties away from such member's home or regular place of
business, shall be allowed travel expenses (including per diem in lieu of
subsistence) as authorized by section 5703 of such title 5 for persons in the
Government employed intermittently.</text>
</paragraph></section><section id="HE59FB0D0B7AB4CDB93361D992C980040"><enum>306.</enum><header>Report</header><text display-inline="no-display-inline">Not later than 6 months after the date of
the enactment of this Act, the Commission shall submit to the President and the
Congress a report setting forth the findings and recommendations of the
Commission as a result of its evaluation under this title.</text>
</section><section id="HFDD1E893914C4F32973CABE2351FB34D"><enum>307.</enum><header>Termination</header><text display-inline="no-display-inline">The Commission shall terminate 2 months
after submitting its report pursuant to section 306.</text>
</section>