[Congressional Record Volume 158, Number 26 (Thursday, February 16, 2012)]
[House]
[Pages H834-H880]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




    CONFERENCE REPORT ON H.R. 3630, MIDDLE CLASS TAX RELIEF AND JOB 
                          CREATION ACT OF 2012

  Mr. CAMP submitted the following conference report and statement on 
the bill (H.R. 3630) to provide incentives for the creation of jobs, 
and for other purposes:

                  Conference Report (H. Rept. 112 399)

       The committee of conference on the disagreeing votes of the 
     two Houses on the amendments of the Senate to the bill (H.R. 
     3630), to provide incentives for the creation of jobs, and 
     for other purposes, having met, after full and free 
     conference, have agreed to recommend and do recommend to 
     their respective Houses as follows:
       That the House recede from its disagreement to the 
     amendment of the Senate to the text of the bill and agree to 
     the same with an amendment as follows:
       In lieu of the matter proposed to be inserted by the Senate 
     amendment, insert the following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Middle 
     Class Tax Relief and Job Creation Act of 2012''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.

              TITLE I--EXTENSION OF PAYROLL TAX REDUCTION

Sec. 1001. Extension of payroll tax reduction.

  TITLE II--UNEMPLOYMENT BENEFIT CONTINUATION AND PROGRAM IMPROVEMENT

Sec. 2001. Short title.

[[Page H835]]

 Subtitle A--Reforms of Unemployment Compensation to Promote Work and 
                              Job Creation

Sec. 2101. Consistent job search requirements.
Sec. 2102. State flexibility to promote the reemployment of unemployed 
              workers.
Sec. 2103. Improving program integrity by better recovery of 
              overpayments.
Sec. 2104. Data exchange standardization for improved interoperability.
Sec. 2105. Drug testing of applicants.

          Subtitle B--Provisions Relating To Extended Benefits

Sec. 2121. Short title.
Sec. 2122. Extension and modification of emergency unemployment 
              compensation program.
Sec. 2123. Temporary extension of extended benefit provisions.
Sec. 2124. Additional extended unemployment benefits under the Railroad 
              Unemployment Insurance Act.

   Subtitle C--Improving Reemployment Strategies Under the Emergency 
                   Unemployment Compensation Program

Sec. 2141. Improved work search for the long-term unemployed.
Sec. 2142. Reemployment services and reemployment and eligibility 
              assessment activities.
Sec. 2143. Promoting program integrity through better recovery of 
              overpayments.
Sec. 2144. Restore State flexibility to improve unemployment program 
              solvency.

              Subtitle D--Short-Time Compensation Program

Sec. 2160. Short title.
Sec. 2161. Treatment of short-time compensation programs.
Sec. 2162. Temporary financing of short-time compensation payments in 
              States with programs in law.
Sec. 2163. Temporary financing of short-time compensation agreements.
Sec. 2164. Grants for short-time compensation programs.
Sec. 2165. Assistance and guidance in implementing programs.
Sec. 2166. Reports.

                 Subtitle E--Self-Employment Assistance

Sec. 2181. State administration of self-employment assistance programs.
Sec. 2182. Grants for self-employment assistance programs.
Sec. 2183. Assistance and guidance in implementing self-employment 
              assistance programs.
Sec. 2184. Definitions.

            TITLE III--MEDICARE AND OTHER HEALTH PROVISIONS

                    Subtitle A--Medicare Extensions

Sec. 3001. Extension of MMA section 508 reclassifications.
Sec. 3002. Extension of outpatient hold harmless payments.
Sec. 3003. Physician payment update.
Sec. 3004. Work geographic adjustment.
Sec. 3005. Payment for outpatient therapy services.
Sec. 3006. Payment for technical component of certain physician 
              pathology services.
Sec. 3007. Ambulance add-on payments.

                  Subtitle B--Other Health Provisions

Sec. 3101. Qualifying individual program.
Sec. 3102. Transitional medical assistance.

                       Subtitle C--Health Offsets

Sec. 3201. Reduction of bad debt treated as an allowable cost.
Sec. 3202. Rebase Medicare clinical laboratory payment rates.
Sec. 3203. Rebasing State DSH allotments for fiscal year 2021.
Sec. 3204. Technical correction to the disaster recovery FMAP 
              provision.
Sec. 3205. Prevention and Public Health Fund.

                        TITLE IV--TANF EXTENSION

Sec. 4001. Short title.
Sec. 4002. Extension of program.
Sec. 4003. Data exchange standardization for improved interoperability.
Sec. 4004. Spending policies for assistance under State TANF programs.
Sec. 4005. Technical corrections.

                 TITLE V--FEDERAL EMPLOYEES RETIREMENT

Sec. 5001. Increase in contributions to Federal Employees' Retirement 
              System for new employees.
Sec. 5002. Foreign Service Pension System.
Sec. 5003. Central Intelligence Agency Retirement and Disability 
              System.

  TITLE VI--PUBLIC SAFETY COMMUNICATIONS AND ELECTROMAGNETIC SPECTRUM 
                                AUCTIONS

Sec. 6001. Definitions.
Sec. 6002. Rule of construction.
Sec. 6003. Enforcement.
Sec. 6004. National security restrictions on use of funds and auction 
              participation.

           Subtitle A--Reallocation of Public Safety Spectrum

Sec. 6101. Reallocation of D block to public safety.
Sec. 6102. Flexible use of narrowband spectrum.
Sec. 6103. 470 512 MHz public safety spectrum.

            Subtitle B--Governance of Public Safety Spectrum

Sec. 6201. Single public safety wireless network licensee.
Sec. 6202. Public safety broadband network.
Sec. 6203. Public Safety Interoperability Board.
Sec. 6204. Establishment of the First Responder Network Authority.
Sec. 6205. Advisory committees of the First Responder Network 
              Authority.
Sec. 6206. Powers, duties, and responsibilities of the First Responder 
              Network Authority.
Sec. 6207. Initial funding for the First Responder Network Authority.
Sec. 6208. Permanent self-funding; duty to assess and collect fees for 
              network use.
Sec. 6209. Audit and report.
Sec. 6210. Annual report to Congress.
Sec. 6211. Public safety roaming and priority access.
Sec. 6212. Prohibition on direct offering of commercial 
              telecommunications service directly to consumers.
Sec. 6213. Provision of technical assistance.

                 Subtitle C--Public Safety Commitments

Sec. 6301. State and Local Implementation Fund.
Sec. 6302. State and local implementation.
Sec. 6303. Public safety wireless communications research and 
              development.

                 Subtitle D--Spectrum Auction Authority

Sec. 6401. Deadlines for auction of certain spectrum.
Sec. 6402. General authority for incentive auctions.
Sec. 6403. Special requirements for incentive auction of broadcast TV 
              spectrum.
Sec. 6404. Certain conditions on auction participation prohibited.
Sec. 6405. Extension of auction authority.
Sec. 6406. Unlicensed use in the 5 GHz band.
Sec. 6407. Guard bands and unlicensed use.
Sec. 6408. Study on receiver performance and spectrum efficiency.
Sec. 6409. Wireless facilities deployment.
Sec. 6410. Functional responsibility of NTIA to ensure efficient use of 
              spectrum.
Sec. 6411. System certification.
Sec. 6412. Deployment of 11 GHz, 18 GHz, and 23 GHz microwave bands.
Sec. 6413. Public Safety Trust Fund.
Sec. 6414. Study on emergency communications by amateur radio and 
              impediments to amateur radio communications.

       Subtitle E--Next Generation 9 1 1 Advancement Act of 2012

Sec. 6501. Short title.
Sec. 6502. Definitions.
Sec. 6503. Coordination of 9 1 1 implementation.
Sec. 6504. Requirements for multi-line telephone systems.
Sec. 6505. GAO study of State and local use of 9 1 1 service charges.
Sec. 6506. Parity of protection for provision or use of Next Generation 
              9 1 1 services.
Sec. 6507. Commission proceeding on autodialing.
Sec. 6508. Report on costs for requirements and specifications of Next 
              Generation 9 1 1 services.
Sec. 6509. Commission recommendations for legal and statutory framework 
              for Next Generation 9 1 1 services.

            Subtitle F--Telecommunications Development Fund

Sec. 6601. No additional Federal funds.
Sec. 6602. Independence of the Fund.

                Subtitle G--Federal Spectrum Relocation

Sec. 6701. Relocation of and spectrum sharing by Federal Government 
              stations.
Sec. 6702. Spectrum Relocation Fund.
Sec. 6703. National security and other sensitive information.

                  TITLE VII--MISCELLANEOUS PROVISIONS

Sec. 7001. Repeal of certain shifts in the timing of corporate 
              estimated tax payments.
Sec. 7002. Repeal of requirement relating to time for remitting certain 
              merchandise processing fees.
Sec. 7003. Treatment for PAYGO purposes.

              TITLE I--EXTENSION OF PAYROLL TAX REDUCTION

     SEC. 1001. EXTENSION OF PAYROLL TAX REDUCTION.

       (a) In General.--Subsection (c) of section 601 of the Tax 
     Relief, Unemployment Insurance Reauthorization, and Job 
     Creation Act of 2010 (26 U.S.C. 1401 note) is amended to read 
     as follows:
       ``(c) Payroll Tax Holiday Period.--The term `payroll tax 
     holiday period' means calendar years 2011 and 2012.''.
       (b) Conforming Amendments.--Section 601 of such Act (26 
     U.S.C. 1401 note) is amended by striking subsections (f) and 
     (g).
       (c) Effective Date.--The amendments made by this section 
     shall apply to remuneration received, and taxable years 
     beginning, after December 31, 2011.

  TITLE II--UNEMPLOYMENT BENEFIT CONTINUATION AND PROGRAM IMPROVEMENT

     SEC. 2001. SHORT TITLE.

       This title may be cited as the ``Extended Benefits, 
     Reemployment, and Program Integrity Improvement Act''.

[[Page H836]]

 Subtitle A--Reforms of Unemployment Compensation to Promote Work and 
                              Job Creation

     SEC. 2101. CONSISTENT JOB SEARCH REQUIREMENTS.

       (a) In General.--Section 303(a) of the Social Security Act 
     is amended by adding at the end the following:
       ``(12) A requirement that, as a condition of eligibility 
     for regular compensation for any week, a claimant must be 
     able to work, available to work, and actively seeking 
     work.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to weeks beginning after the end of the first 
     session of the State legislature which begins after the date 
     of enactment of this Act.

     SEC. 2102. STATE FLEXIBILITY TO PROMOTE THE REEMPLOYMENT OF 
                   UNEMPLOYED WORKERS.

       Title III of the Social Security Act (42 U.S.C. 501 and 
     following) is amended by adding at the end the following:


                        ``demonstration projects

       ``Sec. 305.  (a) The Secretary of Labor may enter into 
     agreements, with up to 10 States that submit an application 
     described in subsection (b), for the purpose of allowing such 
     States to conduct demonstration projects to test and evaluate 
     measures designed--
       ``(1) to expedite the reemployment of individuals who have 
     established a benefit year and are otherwise eligible to 
     claim unemployment compensation under the State law of such 
     State; or
       ``(2) to improve the effectiveness of a State in carrying 
     out its State law with respect to reemployment.
       ``(b) The Governor of any State desiring to conduct a 
     demonstration project under this section shall submit an 
     application to the Secretary of Labor. Any such application 
     shall include--
       ``(1) a general description of the proposed demonstration 
     project, including the authority (under the laws of the 
     State) for the measures to be tested, as well as the period 
     of time during which such demonstration project would be 
     conducted;
       ``(2) if a waiver under subsection (c) is requested, a 
     statement describing the specific aspects of the project to 
     which the waiver would apply and the reasons why such waiver 
     is needed;
       ``(3) a description of the goals and the expected 
     programmatic outcomes of the demonstration project, including 
     how the project would contribute to the objective described 
     in subsection (a)(1), subsection (a)(2), or both;
       ``(4) assurances (accompanied by supporting analysis) that 
     the demonstration project would operate for a period of at 
     least 1 calendar year and not result in any increased net 
     costs to the State's account in the Unemployment Trust Fund;
       ``(5) a description of the manner in which the State--
       ``(A) will conduct an impact evaluation, using a 
     methodology appropriate to determine the effects of the 
     demonstration project, including on individual skill levels, 
     earnings, and employment retention; and
       ``(B) will determine the extent to which the goals and 
     outcomes described in paragraph (3) were achieved;
       ``(6) assurances that the State will provide any reports 
     relating to the demonstration project, after its approval, as 
     the Secretary of Labor may require; and
       ``(7) assurances that employment meets the State's suitable 
     work requirement and the requirements of section 3304(a)(5) 
     of the Internal Revenue Code of 1986.
       ``(c) The Secretary of Labor may waive any of the 
     requirements of section 3304(a)(4) of the Internal Revenue 
     Code of 1986 or of paragraph (1) or (5) of section 303(a), to 
     the extent and for the period the Secretary of Labor 
     considers necessary to enable the State to carry out a 
     demonstration project under this section.
       ``(d) A demonstration project under this section--
       ``(1) may be commenced any time after the date of enactment 
     of this section;
       ``(2) may not be approved for a period of time greater than 
     3 years; and
       ``(3) must be completed by not later than December 31, 
     2015.
       ``(e) Activities that may be pursued under a demonstration 
     project under this section are limited to--
       ``(1) subsidies for employer-provided training, such as 
     wage subsidies; and
       ``(2) direct disbursements to employers who hire 
     individuals receiving unemployment compensation, not to 
     exceed the weekly benefit amount for each such individual, to 
     pay part of the cost of wages that exceed the unemployed 
     individual's prior benefit level.
       ``(f) The Secretary of Labor shall, in the case of any 
     State for which an application is submitted under subsection 
     (b)--
       ``(1) notify the State as to whether such application has 
     been approved or denied within 30 days after receipt of a 
     complete application; and
       ``(2) provide public notice of the decision within 10 days 
     after providing notification to the State in accordance with 
     paragraph (1).

     Public notice under paragraph (2) may be provided through the 
     Internet or other appropriate means. Any application under 
     this section that has not been denied within the 30-day 
     period described in paragraph (1) shall be deemed approved, 
     and public notice of any approval under this sentence shall 
     be provided within 10 days thereafter.
       ``(g) The Secretary of Labor may terminate a demonstration 
     project under this section if the Secretary determines that 
     the State has violated the substantive terms or conditions of 
     the project.
       ``(h) Funding certified under section 302(a) may be used 
     for an approved demonstration project.''.

     SEC. 2103. IMPROVING PROGRAM INTEGRITY BY BETTER RECOVERY OF 
                   OVERPAYMENTS.

       (a) Use of Unemployment Compensation to Repay 
     Overpayments.--Section 3304(a)(4)(D) of the Internal Revenue 
     Code of 1986 and section 303(g)(1) of the Social Security Act 
     are each amended by striking ``may'' and inserting ``shall''.
       (b) Use of Unemployment Compensation to Repay Federal 
     Additional Compensation Overpayments.--Section 303(g)(3) of 
     the Social Security Act is amended by inserting ``Federal 
     additional compensation,'' after ``trade adjustment 
     allowances,''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to weeks beginning after the end of the first 
     session of the State legislature which begins after the date 
     of enactment of this Act.

     SEC. 2104. DATA EXCHANGE STANDARDIZATION FOR IMPROVED 
                   INTEROPERABILITY.

       (a) In General.--Title IX of the Social Security Act is 
     amended by adding at the end the following:


     ``DATA EXCHANGE STANDARDIZATION FOR IMPROVED INTEROPERABILITY

                       ``Data Exchange Standards

       ``Sec. 911. (a)(1) The Secretary of Labor, in consultation 
     with an interagency work group which shall be established by 
     the Office of Management and Budget, and considering State 
     and employer perspectives, shall, by rule, designate a data 
     exchange standard for any category of information required 
     under title III, title XII, or this title.
       ``(2) Data exchange standards designated under paragraph 
     (1) shall, to the extent practicable, be nonproprietary and 
     interoperable.
       ``(3) In designating data exchange standards under this 
     subsection, the Secretary of Labor shall, to the extent 
     practicable, incorporate--
       ``(A) interoperable standards developed and maintained by 
     an international voluntary consensus standards body, as 
     defined by the Office of Management and Budget, such as the 
     International Organization for Standardization;
       ``(B) interoperable standards developed and maintained by 
     intergovernmental partnerships, such as the National 
     Information Exchange Model; and
       ``(C) interoperable standards developed and maintained by 
     Federal entities with authority over contracting and 
     financial assistance, such as the Federal Acquisition 
     Regulations Council.

                ``Data Exchange Standards for Reporting

       ``(b)(1) The Secretary of Labor, in consultation with an 
     interagency work group established by the Office of 
     Management and Budget, and considering State and employer 
     perspectives, shall, by rule, designate data exchange 
     standards to govern the reporting required under title III, 
     title XII, or this title.
       ``(2) The data exchange standards required by paragraph (1) 
     shall, to the extent practicable--
       ``(A) incorporate a widely accepted, nonproprietary, 
     searchable, computer-readable format;
       ``(B) be consistent with and implement applicable 
     accounting principles; and
       ``(C) be capable of being continually upgraded as 
     necessary.
       ``(3) In designating reporting standards under this 
     subsection, the Secretary of Labor shall, to the extent 
     practicable, incorporate existing nonproprietary standards, 
     such as the eXtensible Markup Language.''.
       (b) Effective Dates.--
       (1) Data exchange standards.--The Secretary of Labor shall 
     issue a proposed rule under section 911(a)(1) of the Social 
     Security Act (as added by subsection (a)) within 12 months 
     after the date of the enactment of this section, and shall 
     issue a final rule under such section 911(a)(1), after public 
     comment, within 24 months after such date of enactment.
       (2) Data reporting standards.--The reporting standards 
     required under section 911(b)(1) of such Act (as so added) 
     shall become effective with respect to reports required in 
     the first reporting period, after the effective date of the 
     final rule referred to in paragraph (1) of this subsection, 
     for which the authority for data collection and reporting is 
     established or renewed under the Paperwork Reduction Act.

     SEC. 2105. DRUG TESTING OF APPLICANTS.

       Section 303 of the Social Security Act is amended by adding 
     at the end the following:
       ``(l)(1) Nothing in this Act or any other provision of 
     Federal law shall be considered to prevent a State from 
     enacting legislation to provide for--
       ``(A) testing an applicant for unemployment compensation 
     for the unlawful use of controlled substances as a condition 
     for receiving such compensation, if such applicant--
       ``(i) was terminated from employment with the applicant's 
     most recent employer (as defined under the State law) because 
     of the unlawful use of controlled substances; or
       ``(ii) is an individual for whom suitable work (as defined 
     under the State law) is only available in an occupation that 
     regularly conducts drug testing (as determined under 
     regulations issued by the Secretary of Labor); or
       ``(B) denying such compensation to such applicant on the 
     basis of the result of the testing conducted by the State 
     under legislation described in subparagraph (A).
       ``(2) For purposes of this subsection--
       ``(A) the term `unemployment compensation' has the meaning 
     given such term in subsection (d)(2)(A); and
       ``(B) the term `controlled substance' has the meaning given 
     such term in section 102 of the Controlled Substances Act (21 
     U.S.C. 802).''.

          Subtitle B--Provisions Relating To Extended Benefits

     SEC. 2121. SHORT TITLE.

       This subtitle may be cited as the ``Unemployment Benefits 
     Extension Act of 2012''.

[[Page H837]]

     SEC. 2122. EXTENSION AND MODIFICATION OF EMERGENCY 
                   UNEMPLOYMENT COMPENSATION PROGRAM.

       (a) Extension.--Section 4007 of the Supplemental 
     Appropriations Act, 2008 (Public Law 110 252; 26 U.S.C. 3304 
     note) is amended--
       (1) in subsection (a)--
       (A) by striking ``Except as provided in subsection (b), 
     an'' and inserting ``An''; and
       (B) by striking ``March 6, 2012'' and inserting ``January 
     2, 2013''; and
       (2) by striking subsection (b) and inserting the following:
       ``(b) Termination.--No compensation under this title shall 
     be payable for any week subsequent to the last week described 
     in subsection (a).''.
       (b) Modifications Relating to Triggers.--
       (1) For second-tier emergency unemployment compensation.--
     Section 4002(c) of such Act is amended--
       (A) in the subsection heading, by striking ``Special Rule'' 
     and inserting ``Second-tier Emergency Unemployment 
     Compensation'';
       (B) in paragraph (1), by striking ``At'' and all that 
     follows through ``augmented by an amount'' and inserting 
     ``If, at the time that the amount established in an 
     individual's account under subsection (b) is exhausted or at 
     any time thereafter, such individual's State is in an 
     extended benefit period (as determined under paragraph (2)), 
     such account shall be augmented by an amount (hereinafter 
     `second-tier emergency unemployment compensation')'';
       (C) by redesignating paragraph (2) as paragraph (4); and
       (D) by inserting after paragraph (1) the following:
       ``(2) Extended benefit period.--For purposes of paragraph 
     (1), a State shall be considered to be in an extended benefit 
     period, as of any given time, if such a period would then be 
     in effect for such State under such Act if--
       ``(A) section 203(f) of the Federal-State Extended 
     Unemployment Compensation Act of 1970 were applied to such 
     State (regardless of whether the State by law had provided 
     for such application); and
       ``(B) such section 203(f)--
       ``(i) were applied by substituting the applicable 
     percentage under paragraph (3) for `6.5 percent' in paragraph 
     (1)(A)(i) thereof; and
       ``(ii) did not include the requirement under paragraph 
     (1)(A)(ii) thereof.
       ``(3) Applicable percentage.--The applicable percentage 
     under this paragraph is, for purposes of determining if a 
     State is in an extended benefit period as of a date occurring 
     in a week ending--
       ``(A) before June 1, 2012, 0 percent; and
       ``(B) after the last week under subparagraph (A), 6 
     percent.''.
       (2) For third-tier emergency unemployment compensation.--
     Section 4002(d) of such Act is amended--
       (A) in paragraph (2)(A), by striking ``under such Act'' and 
     inserting ``under the Federal-State Extended Unemployment 
     Compensation Act of 1970'';
       (B) in paragraph (2)(B)(ii)(I), by striking the matter 
     after ``substituting'' and before ``in paragraph (1)(A)(i) 
     thereof'' and inserting ``the applicable percentage under 
     paragraph (3) for `6.5 percent' '';
       (C) by redesignating paragraph (3) as paragraph (4); and
       (D) by inserting after paragraph (2) the following:
       ``(3) Applicable percentage.--The applicable percentage 
     under this paragraph is, for purposes of determining if a 
     State is in an extended benefit period as of a date occurring 
     in a week ending--
       ``(A) before June 1, 2012, 6 percent; and
       ``(B) after the last week under subparagraph (A), 7 
     percent.''.
       (3) For fourth-tier emergency unemployment compensation.--
     Section 4002(e) of such Act is amended--
       (A) in paragraph (2)(A), by striking ``under such Act'' and 
     inserting ``under the Federal-State Extended Unemployment 
     Compensation Act of 1970'';
       (B) in paragraph (2)(B)(ii)(I), by striking the matter 
     after ``substituting'' and before ``in paragraph (1)(A)(i) 
     thereof'' and inserting ``the applicable percentage under 
     paragraph (3) for `6.5 percent' '';
       (C) by redesignating paragraph (3) as paragraph (4); and
       (D) by inserting after paragraph (2) the following:
       ``(3) Applicable percentage.--The applicable percentage 
     under this paragraph is, for purposes of determining if a 
     State is in an extended benefit period as of a date occurring 
     in a week ending--
       ``(A) before June 1, 2012, 8.5 percent; and
       ``(B) after the last week under subparagraph (A), 9 
     percent.''.
       (c) Modifications Relating to Weeks of Emergency 
     Unemployment Compensation.--
       (1) Number of weeks in first tier beginning after september 
     2, 2012.--Section 4002(b) of such Act is amended--
       (A) by redesignating paragraph (2) as paragraph (3); and
       (B) by inserting after paragraph (1) the following:
       ``(2) Special rule relating to amounts established in an 
     account as of a week ending after september 2, 2012.--
     Notwithstanding any provision of paragraph (1), in the case 
     of any account established as of a week ending after 
     September 2, 2012--
       ``(A) paragraph (1)(A) shall be applied by substituting `54 
     percent' for `80 percent'; and
       ``(B) paragraph (1)(B) shall be applied by substituting `14 
     weeks' for `20 weeks'.''.
       (2) Number of weeks in third tier beginning after september 
     2, 2012.--Section 4002(d) of such Act is amended by adding 
     after paragraph (4) (as so redesignated by subsection 
     (b)(2)(C)) the following:
       ``(5) Special rule relating to amounts added to an account 
     as of a week ending after september 2, 2012.--Notwithstanding 
     any provision of paragraph (1), if augmentation under this 
     subsection occurs as of a week ending after September 2, 
     2012--
       ``(A) paragraph (1)(A) shall be applied by substituting `35 
     percent' for `50 percent'; and
       ``(B) paragraph (1)(B) shall be applied by substituting `9 
     times' for `13 times'.''.
       (3) Number of weeks in fourth tier.--Section 4002(e) of 
     such Act is amended by adding after paragraph (4) (as so 
     redesignated by subsection (b)(3)(C)) the following:
       ``(5) Special rules relating to amounts added to an 
     account.--
       ``(A) March to may of 2012.--
       ``(i) Special rule.--Notwithstanding any provision of 
     paragraph (1) but subject to the following 2 sentences, if 
     augmentation under this subsection occurs as of a week ending 
     after the date of enactment of this paragraph and before June 
     1, 2012 (or if, as of such date of enactment, any fourth-tier 
     amounts remain in the individual's account)--

       ``(I) paragraph (1)(A) shall be applied by substituting `62 
     percent' for `24 percent'; and
       ``(II) paragraph (1)(B) shall be applied by substituting 
     `16 times' for `6 times'.

     The preceding sentence shall apply only if, at the time that 
     the account would be augmented under this subparagraph, such 
     individual's State is not in an extended benefit period as 
     determined under the Federal-State Extended Unemployment 
     Compensation Act of 1970. In no event shall the total amount 
     added to the account of an individual under this subparagraph 
     cause, in the case of an individual described in the 
     parenthetical matter in the first sentence of this clause, 
     the sum of the total amount previously added to such 
     individual's account under this subsection (as in effect 
     before the date of enactment of this paragraph) and any 
     further amounts added as a result of the enactment of this 
     clause, to exceed the total amount allowable under subclause 
     (I) or (II), as the case may be.
       ``(ii) Limitation.--Notwithstanding any other provision of 
     this title, the amounts added to the account of an individual 
     under this subparagraph may not cause the sum of the amounts 
     previously established in or added to such account, plus any 
     weeks of extended benefits provided to such individual under 
     the Federal-State Extended Unemployment Compensation Act of 
     1970 (based on the same exhaustion of regular compensation 
     under section 4001(b)(1)), to in the aggregate exceed the 
     lesser of--

       ``(I) 282 percent of the total amount of regular 
     compensation (including dependents' allowances) payable to 
     the individual during the individual's benefit year under the 
     State law; or
       ``(II) 73 times the individual's average weekly benefit 
     amount (as determined under subsection (b)(3)) for the 
     benefit year.

       ``(B) After august of 2012.--Notwithstanding any provision 
     of paragraph (1), if augmentation under this subsection 
     occurs as of a week ending after September 2, 2012--
       ``(i) paragraph (1)(A) shall be applied by substituting `39 
     percent' for `24 percent'; and
       ``(ii) paragraph (1)(B) shall be applied by substituting 
     `10 times' for `6 times'.''.
       (d) Order of Payments Requirement.--
       (1) In general.--Section 4001(e) of such Act is amended to 
     read as follows:
       ``(e) Coordination Rule.--An agreement under this section 
     shall apply with respect to a State only upon a determination 
     by the Secretary that, under the State law or other 
     applicable rules of such State, the payment of extended 
     compensation for which an individual is otherwise eligible 
     must be deferred until after the payment of any emergency 
     unemployment compensation under section 4002, as amended by 
     the Unemployment Benefits Extension Act of 2012, for which 
     the individual is concurrently eligible.''.
       (2) Technical and conforming amendments.--Section 
     4001(b)(2) of such Act is amended--
       (A) by striking ``or extended compensation''; and
       (B) by striking ``law (except as provided under subsection 
     (e));'' and inserting ``law;''.
       (e) Funding.--Section 4004(e)(1) of such Act is amended--
       (1) in subparagraph (G), by striking ``and'' at the end; 
     and
       (2) by inserting after subparagraph (H) the following:
       ``(I) the amendments made by section 2122 of the 
     Unemployment Benefits Extension Act of 2012; and''.
       (f) Effective Dates.--
       (1) In general.--The amendments made by subsections (b), 
     (c), and (d) shall take effect as of February 28, 2012, and 
     shall apply with respect to weeks of unemployment beginning 
     after that date.
       (2) Week defined.--For purposes of this subsection, the 
     term ``week'' has the meaning given such term under section 
     4006 of the Supplemental Appropriations Act, 2008.

     SEC. 2123. TEMPORARY EXTENSION OF EXTENDED BENEFIT 
                   PROVISIONS.

       (a) In General.--Section 2005 of the Assistance for 
     Unemployed Workers and Struggling Families Act, as contained 
     in Public Law 111 5 (26 U.S.C. 3304 note), is amended--
       (1) by striking ``March 7, 2012'' each place it appears and 
     inserting ``December 31, 2012''; and
       (2) in subsection (c), by striking ``August 15, 2012'' and 
     inserting ``June 30, 2013''.
       (b) Extension of Matching for States With No Waiting 
     Week.--Section 5 of the Unemployment Compensation Extension 
     Act of 2008 (Public Law 110 449; 26 U.S.C. 3304 note) is 
     amended by striking ``August 15, 2012'' and inserting ``June 
     30, 2013''.

[[Page H838]]

       (c) Extension of Modification of Indicators Under the 
     Extended Benefit Program.--Section 203 of the Federal-State 
     Extended Unemployment Compensation Act of 1970 (26 U.S.C. 
     3304 note) is amended--
       (1) in subsection (d), by striking ``February 29, 2012'' 
     and inserting ``December 31, 2012''; and
       (2) in subsection (f)(2), by striking ``February 29, 2012'' 
     and inserting ``December 31, 2012''.
       (d) Effective Date.--The amendments made by this section 
     shall take effect as if included in the enactment of the 
     Temporary Payroll Tax Cut Continuation Act of 2011 (Public 
     Law 112-78).

     SEC. 2124. ADDITIONAL EXTENDED UNEMPLOYMENT BENEFITS UNDER 
                   THE RAILROAD UNEMPLOYMENT INSURANCE ACT.

       (a) Extension.--Section 2(c)(2)(D)(iii) of the Railroad 
     Unemployment Insurance Act, as added by section 2006 of the 
     American Recovery and Reinvestment Act of 2009 (Public Law 96 
     111 5) and as amended by section 9 of the Worker, 
     Homeownership, and Business Assistance Act of 2009 (Public 
     Law 111 92), section 505 of the Tax Relief, Unemployment 
     Insurance Reauthorization, and Job Creation Act of 2010 
     (Public Law 111 312), and section 202 of the Temporary 
     Payroll Tax Cut Continuation Act of 2011 (Public Law 112-78), 
     is amended--
       (1) by striking ``August 31, 2011'' and inserting ``June 
     30, 2012''; and
       (2) by striking ``February 29, 2012'' and inserting 
     ``December 31, 2012''.
       (b) Clarification on Authority to Use Funds.--Funds 
     appropriated under either the first or second sentence of 
     clause (iv) of section 2(c)(2)(D) of the Railroad 
     Unemployment Insurance Act shall be available to cover the 
     cost of additional extended unemployment benefits provided 
     under such section 2(c)(2)(D) by reason of the amendments 
     made by subsection (a) as well as to cover the cost of such 
     benefits provided under such section 2(c)(2)(D), as in effect 
     on the day before the date of enactment of this Act.
       (c) Funding for Administration.--Out of any funds in the 
     Treasury not otherwise appropriated, there are appropriated 
     to the Railroad Retirement Board $500,000 for administrative 
     expenses associated with the payment of additional extended 
     unemployment benefits provided under section 2(c)(2)(D) of 
     the Railroad Unemployment Insurance Act by reason of the 
     amendments made by subsection (a), to remain available until 
     expended.

   Subtitle C--Improving Reemployment Strategies Under the Emergency 
                   Unemployment Compensation Program

     SEC. 2141. IMPROVED WORK SEARCH FOR THE LONG-TERM UNEMPLOYED.

       (a) In General.--Section 4001(b) of the Supplemental 
     Appropriations Act, 2008 (Public Law 110 252; 26 U.S.C. 3304 
     note) is amended--
       (1) by striking ``and'' at the end of paragraph (2);
       (2) by striking the period at the end of paragraph (3) and 
     inserting ``; and''; and
       (3) by adding at the end the following:
       ``(4) are able to work, available to work, and actively 
     seeking work.''.
       (b) Actively Seeking Work.--Section 4001 of such Act is 
     amended by adding at the end the following:
       ``(h) Actively Seeking Work.--
       ``(1) In general.--For purposes of subsection (b)(4), the 
     term `actively seeking work' means, with respect to any 
     individual, that such individual--
       ``(A) is registered for employment services in such a 
     manner and to such extent as prescribed by the State agency;
       ``(B) has engaged in an active search for employment that 
     is appropriate in light of the employment available in the 
     labor market, the individual's skills and capabilities, and 
     includes a number of employer contacts that is consistent 
     with the standards communicated to the individual by the 
     State;
       ``(C) has maintained a record of such work search, 
     including employers contacted, method of contact, and date 
     contacted; and
       ``(D) when requested, has provided such work search record 
     to the State agency.
       ``(2) Random auditing.--The Secretary shall establish for 
     each State a minimum number of claims for which work search 
     records must be audited on a random basis in any given 
     week.''.

     SEC. 2142. REEMPLOYMENT SERVICES AND REEMPLOYMENT AND 
                   ELIGIBILITY ASSESSMENT ACTIVITIES.

       (a) Provision of Services and Activities.--Section 4001 of 
     such Act, as amended by section 2141(b), is further amended 
     by added at the end the following:
       ``(i) Provision of Services and Activities.--
       ``(1) In general.--An agreement under this section shall 
     require the following:
       ``(A) The State which is party to such agreement shall 
     provide reemployment services and reemployment and 
     eligibility assessment activities to each individual--
       ``(i) who, on or after the 30th day after the date of 
     enactment of the Extended Benefits, Reemployment, and Program 
     Integrity Improvement Act, begins receiving amounts described 
     in subsections (b) and (c); and
       ``(ii) while such individual continues to receive emergency 
     unemployment compensation under this title.
       ``(B) As a condition of eligibility for emergency 
     unemployment compensation for any week--
       ``(i) a claimant who has been duly referred to reemployment 
     services shall participate in such services; and
       ``(ii) a claimant shall be actively seeking work 
     (determined applying subsection (i)).
       ``(2) Description of services and activities.--The 
     reemployment services and in-person reemployment and 
     eligibility assessment activities provided to individuals 
     receiving emergency unemployment compensation described in 
     paragraph (1)--
       ``(A) shall include--
       ``(i) the provision of labor market and career information;
       ``(ii) an assessment of the skills of the individual;
       ``(iii) orientation to the services available through the 
     one-stop centers established under title I of the Workforce 
     Investment Act of 1998; and
       ``(iv) review of the eligibility of the individual for 
     emergency unemployment compensation relating to the job 
     search activities of the individual; and
       ``(B) may include the provision of--
       ``(i) comprehensive and specialized assessments;
       ``(ii) individual and group career counseling;
       ``(iii) training services;
       ``(iv) additional reemployment services; and
       ``(v) job search counseling and the development or review 
     of an individual reemployment plan that includes 
     participation in job search activities and appropriate 
     workshops.
       ``(3) Participation requirement.--As a condition of 
     continuing eligibility for emergency unemployment 
     compensation for any week, an individual who has been 
     referred to reemployment services or reemployment and 
     eligibility assessment activities under this subsection shall 
     participate in such services or activities, unless the State 
     agency responsible for the administration of State 
     unemployment compensation law determines that--
       ``(A) such individual has completed participating in such 
     services or activities; or
       ``(B) there is justifiable cause for failure to participate 
     or to complete participating in such services or activities, 
     as determined in accordance with guidance to be issued by the 
     Secretary.''.
       (b) Issuance of Guidance.--Not later than 30 days after the 
     date of enactment of this Act, the Secretary shall issue 
     guidance on the implementation of the reemployment services 
     and reemployment and eligibility assessment activities 
     required to be provided under the amendment made by 
     subsection (a).
       (c) Funding.--
       (1) In general.--Section 4004(c) of the Supplemental 
     Appropriations Act, 2008 (Public Law 110 252; 26 U.S.C. 3304 
     note) is amended--
       (A) by striking ``States.--There'' and inserting the 
     following: ``States.--
       ``(1) Administration.--There''; and
       (B) by adding at the end the following new paragraph:
       ``(2) Reemployment services and reemployment and 
     eligibility assessment activities.--
       ``(A) Appropriation.--There are appropriated from the 
     general fund of the Treasury, for the period of fiscal year 
     2012 through fiscal year 2013, out of the employment security 
     administration account (as established by section 901(a) of 
     the Social Security Act), such sums as determined by the 
     Secretary of Labor in accordance with subparagraph (B) to 
     assist States in providing reemployment services and 
     reemployment and eligibility assessment activities described 
     in section 4001(h)(2).
       ``(B) Determination of total amount.--The amount referred 
     to in subparagraph (A) is the amount the Secretary of Labor 
     estimates is equal to--
       ``(i) the number of individuals who will receive 
     reemployment services and reemployment eligibility and 
     assessment activities described in section 4001(h)(2) in all 
     States through the date specified in section 4007(b)(3); 
     multiplied by
       ``(ii) $85.
       ``(C) Distribution among states.--Of the amounts 
     appropriated under subparagraph (A), the Secretary of Labor 
     shall distribute amounts to each State, in accordance with 
     section 4003(c), that the Secretary estimates is equal to--
       ``(i) the number of individuals who will receive 
     reemployment services and reemployment and eligibility 
     assessment activities described in section 4001(h)(2) in such 
     State through the date specified in section 4007(b)(3); 
     multiplied by
       ``(ii) $85.''.
       (2) Transfer of funds.--Section 4004(e) of the Supplemental 
     Appropriations Act, 2008 (Public Law 110 252; 26 U.S.C. 3304 
     note) is amended--
       (A) in paragraph (1)(G), by striking ``and'' at the end;
       (B) in paragraph (2), by striking the period at the end and 
     inserting ``; and''; and
       (C) by adding at the end the following paragraph:
       ``(3) to the Employment Security Administration account (as 
     established by section 901(a) of the Social Security Act) 
     such sums as the Secretary of Labor determines to be 
     necessary in accordance with subsection (c)(2) to assist 
     States in providing reemployment services and reemployment 
     eligibility and assessment activities described in section 
     4001(h)(2).''.

     SEC. 2143. PROMOTING PROGRAM INTEGRITY THROUGH BETTER 
                   RECOVERY OF OVERPAYMENTS.

       Section 4005(c)(1) of the Supplemental Appropriations Act, 
     2008 (Public Law 110 252; 26 U.S.C. 3304 note) is amended--
       (1) by striking ``may'' and inserting ``shall''; and
       (2) by striking ``except that'' and all that follows 
     through ``made'' and inserting ``in accordance with the same 
     procedures as apply to the recovery of overpayments of 
     regular unemployment benefits paid by the State''.

     SEC. 2144. RESTORE STATE FLEXIBILITY TO IMPROVE UNEMPLOYMENT 
                   PROGRAM SOLVENCY.

       Subsection (g) of section 4001 of the Supplemental 
     Appropriations Act, 2008 (Public Law 110 252; 26 U.S.C. 3304 
     note) shall not apply with respect to a State that has 
     enacted a law before March 1, 2012, that, upon taking effect, 
     would violate such subsection.

[[Page H839]]

              Subtitle D--Short-Time Compensation Program

     SEC. 2160. SHORT TITLE.

       This subtitle may be cited as the ``Layoff Prevention Act 
     of 2012''.

     SEC. 2161. TREATMENT OF SHORT-TIME COMPENSATION PROGRAMS.

       (a) Definition.--
       (1) In general.--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:
       ``(v) Short-Time Compensation Program.--For purposes of 
     this part, 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 layoffs;
       ``(3) such employees whose workweeks have been reduced by 
     at least 10 percent, and by not more than the percentage, if 
     any, that is determined by the State to be appropriate (but 
     in no case more than 60 percent), are not disqualified from 
     unemployment compensation;
       ``(4) the amount of unemployment compensation payable to 
     any such employee is a pro rata portion of the unemployment 
     compensation which would otherwise be payable to the employee 
     if such employee were unemployed;
       ``(5) such employees meet the availability for work and 
     work search test requirements while collecting short-time 
     compensation benefits, by being available for their workweek 
     as required by the State agency;
       ``(6) eligible employees may participate, as appropriate, 
     in training (including employer-sponsored training or worker 
     training funded under the Workforce Investment Act of 1998) 
     to enhance job skills if such program has been approved by 
     the State agency;
       ``(7) the State agency shall require employers to certify 
     that if the employer provides health benefits and retirement 
     benefits under a defined benefit plan (as defined in section 
     414(j)) or contributions under a defined contribution plan 
     (as defined in section 414(i)) to any employee whose workweek 
     is reduced under the program that such benefits will continue 
     to be provided to employees participating in the short-time 
     compensation program under the same terms and conditions as 
     though the workweek of such employee had not been reduced or 
     to the same extent as other employees not participating in 
     the short-time compensation program;
       ``(8) the State agency shall require an employer to submit 
     a written plan describing the manner in which the 
     requirements of this subsection will be implemented 
     (including a plan for giving advance notice, where feasible, 
     to an employee whose workweek is to be reduced) together with 
     an estimate of the number of layoffs that would have occurred 
     absent the ability to participate in short-time compensation 
     and such other information as the Secretary of Labor 
     determines is appropriate;
       ``(9) the terms of the employer's written plan and 
     implementation shall be consistent with employer obligations 
     under applicable Federal and State laws; and
       ``(10) upon request by the State and approval by the 
     Secretary of Labor, only such other provisions are included 
     in the State law that are determined to be appropriate for 
     purposes of a short-time compensation program.''.
       (2) Effective date.--Subject to paragraph (3), the 
     amendment made by paragraph (1) shall take effect on the date 
     of the enactment of this Act.
       (3) Transition period for existing programs.--In the case 
     of a State that is administering a short-time compensation 
     program as of the date of the enactment of this Act and the 
     State law cannot be administered consistent with the 
     amendment made by paragraph (1), such amendment shall take 
     effect on the earlier of--
       (A) the date the State changes its State law in order to be 
     consistent with such amendment; or
       (B) the date that is 2 years and 6 months after the date of 
     the enactment of this Act.
       (b) Conforming Amendments.--
       (1) Internal revenue code of 1986.--
       (A) Subparagraph (E) of section 3304(a)(4) of the Internal 
     Revenue Code of 1986 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(v));''.
       (B) Subsection (f) of section 3306 of the Internal Revenue 
     Code of 1986 is amended--
       (i) by striking paragraph (5) (relating to short-time 
     compensation) and inserting the following new paragraph:
       ``(5) amounts may be withdrawn for the payment of short-
     time compensation under a short-time compensation program (as 
     defined in subsection (v)); and''; and
       (ii) by redesignating paragraph (5) (relating to self-
     employment assistance program) as paragraph (6).
       (2) Social security act.--Section 303(a)(5) of the Social 
     Security Act 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(v) of the Internal Revenue Code of 
     1986)''.
       (3) Unemployment compensation amendments of 1992.--
     Subsections (b) through (d) of section 401 of the 
     Unemployment Compensation Amendments of 1992 (26 U.S.C. 3304 
     note) are repealed.

     SEC. 2162. TEMPORARY FINANCING OF SHORT-TIME COMPENSATION 
                   PAYMENTS IN STATES WITH PROGRAMS IN LAW.

       (a) Payments to States.--
       (1) In general.--Subject to paragraph (3), there shall be 
     paid to a State an amount equal to 100 percent of the amount 
     of short-time compensation paid under a short-time 
     compensation program (as defined in section 3306(v) of the 
     Internal Revenue Code of 1986, as added by section 2161(a)) 
     under the provisions of the State law.
       (2) Terms of payments.--Payments made to a State under 
     paragraph (1) shall be payable by way of reimbursement in 
     such amounts as the Secretary estimates the State will be 
     entitled to receive under this section for each calendar 
     month, reduced or increased, as the case may be, by any 
     amount by which the Secretary finds that the Secretary's 
     estimates for any prior calendar month were greater or less 
     than the amounts which should have been paid to the State. 
     Such estimates may be made on the basis of such statistical, 
     sampling, or other method as may be agreed upon by the 
     Secretary and the State agency of the State involved.
       (3) Limitations on payments.--
       (A) General payment limitations.--No payments shall be made 
     to a State under this section for short-time compensation 
     paid to an individual by the State during a benefit year in 
     excess of 26 times the amount of regular compensation 
     (including dependents' allowances) under the State law 
     payable to such individual for a week of total unemployment.
       (B) Employer limitations.--No payments shall be made to a 
     State under this section for benefits paid to an individual 
     by the State under a short-time compensation program if such 
     individual is employed by the participating employer on a 
     seasonal, temporary, or intermittent basis.
       (b) Applicability.--
       (1) In general.--Payments to a State under subsection (a) 
     shall be available for weeks of unemployment--
       (A) beginning on or after the date of the enactment of this 
     Act; and
       (B) ending on or before the date that is 3 years and 6 
     months after the date of the enactment of this Act.
       (2) Three-year funding limitation for combined payments 
     under this section and section 2163.--States may receive 
     payments under this section and section 2163 with respect to 
     a total of not more than 156 weeks.
       (c) Two-Year Transition Period for Existing Programs.--
     During any period that the transition provision under section 
     2161(a)(3) is applicable to a State with respect to a short-
     time compensation program, such State shall be eligible for 
     payments under this section. Subject to paragraphs (1)(B) and 
     (2) of subsection (b), if at any point after the date of the 
     enactment of this Act the State enacts a State law providing 
     for the payment of short-time compensation under a short-time 
     compensation program that meets the definition of such a 
     program under section 3306(v) of the Internal Revenue Code of 
     1986, as added by section 2161(a), the State shall be 
     eligible for payments under this section after the effective 
     date of such enactment.
       (d) Funding and Certifications.--
       (1) Funding.--There are appropriated, out of moneys in the 
     Treasury not otherwise appropriated, such sums as may be 
     necessary for purposes of carrying out this section.
       (2) Certifications.--The Secretary shall from time to time 
     certify to the Secretary of the Treasury for payment to each 
     State the sums payable to such State under this section.
       (e) Definitions.--In this section:
       (1) Secretary.--The term ``Secretary'' means the Secretary 
     of Labor.
       (2) State; state agency; state law.--The terms ``State'', 
     ``State agency'', and ``State law'' have the meanings given 
     those terms in section 205 of the Federal-State Extended 
     Unemployment Compensation Act of 1970 (26 U.S.C. 3304 note).

     SEC. 2163. TEMPORARY FINANCING OF SHORT-TIME COMPENSATION 
                   AGREEMENTS.

       (a) Federal-State Agreements.--
       (1) In general.--Any State which desires to do so may enter 
     into, and participate in, an agreement under this section 
     with the Secretary provided that such State's law does not 
     provide for the payment of short-time compensation under a 
     short-time compensation program (as defined in section 
     3306(v) of the Internal Revenue Code of 1986, as added by 
     section 2161(a)).
       (2) Ability to terminate.--Any State which is a party to an 
     agreement under this section may, upon providing 30 days' 
     written notice to the Secretary, terminate such agreement.
       (b) Provisions of Federal-State Agreement.--
       (1) In general.--Any agreement under this section shall 
     provide that the State agency of the State will make payments 
     of short-time compensation under a plan approved by the 
     State. Such plan shall provide that payments are made in 
     accordance with the requirements under section 3306(v) of the 
     Internal Revenue Code of 1986, as added by section 2161(a).
       (2) Limitations on plans.--
       (A) General payment limitations.--A short-time compensation 
     plan approved by a State shall not permit the payment of 
     short-time compensation to an individual by the State during 
     a benefit year in excess of 26 times the amount of regular 
     compensation (including dependents' allowances) under the 
     State law payable to such individual for a week of total 
     unemployment.
       (B) Employer limitations.--A short-time compensation plan 
     approved by a State shall not provide payments to an 
     individual if such individual is employed by the 
     participating employer on a seasonal, temporary, or 
     intermittent basis.
       (3) Employer payment of costs.--Any short-time compensation 
     plan entered into by an employer must provide that the 
     employer will pay the State an amount equal to one-half of 
     the amount of short-time compensation paid under such plan. 
     Such amount shall be deposited in the State's unemployment 
     fund and shall not be used for purposes of calculating an 
     employer's contribution rate under section 3303(a)(1) of the 
     Internal Revenue Code of 1986.

[[Page H840]]

       (c) Payments to States.--
       (1) In general.--There shall be paid to each State with an 
     agreement under this section an amount equal to--
       (A) one-half of the amount of short-time compensation paid 
     to individuals by the State pursuant to such agreement; and
       (B) any additional administrative expenses incurred by the 
     State by reason of such agreement (as determined by the 
     Secretary).
       (2) Terms of payments.--Payments made to a State under 
     paragraph (1) shall be payable by way of reimbursement in 
     such amounts as the Secretary estimates the State will be 
     entitled to receive under this section for each calendar 
     month, reduced or increased, as the case may be, by any 
     amount by which the Secretary finds that the Secretary's 
     estimates for any prior calendar month were greater or less 
     than the amounts which should have been paid to the State. 
     Such estimates may be made on the basis of such statistical, 
     sampling, or other method as may be agreed upon by the 
     Secretary and the State agency of the State involved.
       (3) Funding.--There are appropriated, out of moneys in the 
     Treasury not otherwise appropriated, such sums as may be 
     necessary for purposes of carrying out this section.
       (4) Certifications.--The Secretary shall from time to time 
     certify to the Secretary of the Treasury for payment to each 
     State the sums payable to such State under this section.
       (d) Applicability.--
       (1) In general.--An agreement entered into under this 
     section shall apply to weeks of unemployment--
       (A) beginning on or after the date on which such agreement 
     is entered into; and
       (B) ending on or before the date that is 2 years and 13 
     weeks after the date of the enactment of this Act.
       (2) Two-year funding limitation.--States may receive 
     payments under this section with respect to a total of not 
     more than 104 weeks.
       (e) Special Rule.--If a State has entered into an agreement 
     under this section and subsequently enacts a State law 
     providing for the payment of short-time compensation under a 
     short-time compensation program that meets the definition of 
     such a program under section 3306(v) of the Internal Revenue 
     Code of 1986, as added by section 2161(a), the State--
       (1) shall not be eligible for payments under this section 
     for weeks of unemployment beginning after the effective date 
     of such State law; and
       (2) subject to paragraphs (1)(B) and (2) of section 
     2162(b), shall be eligible to receive payments under section 
     2162 after the effective date of such State law.
       (f) Definitions.--In this section:
       (1) Secretary.--The term ``Secretary'' means the Secretary 
     of Labor.
       (2) State; state agency; state law.--The terms ``State'', 
     ``State agency'', and ``State law'' have the meanings given 
     those terms in section 205 of the Federal-State Extended 
     Unemployment Compensation Act of 1970 (26 U.S.C. 3304 note).

     SEC. 2164. GRANTS FOR SHORT-TIME COMPENSATION PROGRAMS.

       (a) Grants.--
       (1) For implementation or improved administration.--The 
     Secretary shall award grants to States that enact short-time 
     compensation programs (as defined in subsection (i)(2)) for 
     the purpose of implementation or improved administration of 
     such programs.
       (2) For promotion and enrollment.--The Secretary shall 
     award grants to States that are eligible and submit plans for 
     a grant under paragraph (1) for such States to promote and 
     enroll employers in short-time compensation programs (as so 
     defined).
       (3) Eligibility.--
       (A) In general.--The Secretary shall determine eligibility 
     criteria for the grants under paragraphs (1) and (2).
       (B) Clarification.--A State administering a short-time 
     compensation program, including a program being administered 
     by a State that is participating in the transition under the 
     provisions of sections 301(a)(3) and 302(c), that does not 
     meet the definition of a short-time compensation program 
     under section 3306(v) of the Internal Revenue Code of 1986 
     (as added by 211(a)), and a State with an agreement under 
     section 2163, shall not be eligible to receive a grant under 
     this section until such time as the State law of the State 
     provides for payments under a short-time compensation program 
     that meets such definition and such law.
       (b) Amount of Grants.--
       (1) In general.--The maximum amount available for making 
     grants to a State under paragraphs (1) and (2) shall be equal 
     to the amount obtained by multiplying $100,000,000 (less the 
     amount used by the Secretary under subsection (e)) by the 
     same ratio as would apply under subsection (a)(2)(B) of 
     section 903 of the Social Security Act (42 U.S.C. 1103) for 
     purposes of determining such State's share of any excess 
     amount (as described in subsection (a)(1) of such section) 
     that would have been subject to transfer to State accounts, 
     as of October 1, 2010, under the provisions of subsection (a) 
     of such section.
       (2) Amount available for different grants.--Of the maximum 
     incentive payment determined under paragraph (1) with respect 
     to a State--
       (A) one-third shall be available for a grant under 
     subsection (a)(1); and
       (B) two-thirds shall be available for a grant under 
     subsection (a)(2).
       (c) Grant Application and Disbursal.--
       (1) Application.--Any State seeking a grant under paragraph 
     (1) or (2) of subsection (a) shall submit an application to 
     the Secretary at such time, in such manner, and complete with 
     such information as the Secretary may require. In no case may 
     the Secretary award a grant under this section with respect 
     to an application that is submitted after December 31, 2014.
       (2) Notice.--The Secretary shall, within 30 days after 
     receiving a complete application, notify the State agency of 
     the State of the Secretary's findings with respect to the 
     requirements for a grant under paragraph (1) or (2) (or both) 
     of subsection (a).
       (3) Certification.--If the Secretary finds that the State 
     law provisions meet the requirements for a grant under 
     subsection (a), the Secretary shall thereupon make a 
     certification to that effect to the Secretary of the 
     Treasury, together with a certification as to the amount of 
     the grant payment to be transferred to the State account in 
     the Unemployment Trust Fund (as established in section 904(a) 
     of the Social Security Act (42 U.S.C. 1104(a))) pursuant to 
     that finding. The Secretary of the Treasury shall make the 
     appropriate transfer to the State account within 7 days after 
     receiving such certification.
       (4) Requirement.--No certification of compliance with the 
     requirements for a grant under paragraph (1) or (2) of 
     subsection (a) may be made with respect to any State whose--
       (A) State law is not otherwise eligible for certification 
     under section 303 of the Social Security Act (42 U.S.C. 503) 
     or approvable under section 3304 of the Internal Revenue Code 
     of 1986; or
       (B) short-time compensation program is subject to 
     discontinuation or is not scheduled to take effect within 12 
     months of the certification.
       (d) Use of Funds.--The amount of any grant awarded under 
     this section shall be used for the implementation of short-
     time compensation programs and the overall administration of 
     such programs and the promotion and enrollment efforts 
     associated with such programs, such as through--
       (1) the creation or support of rapid response teams to 
     advise employers about alternatives to layoffs;
       (2) the provision of education or assistance to employers 
     to enable them to assess the feasibility of participating in 
     short-time compensation programs; and
       (3) the development or enhancement of systems to automate--
       (A) the submission and approval of plans; and
       (B) the filing and approval of new and ongoing short-time 
     compensation claims.
       (e) Administration.--The Secretary is authorized to use 
     0.25 percent of the funds available under subsection (g) to 
     provide for outreach and to share best practices with respect 
     to this section and short-time compensation programs.
       (f) Recoupment.--The Secretary shall establish a process 
     under which the Secretary shall recoup the amount of any 
     grant awarded under paragraph (1) or (2) of subsection (a) if 
     the Secretary determines that, during the 5-year period 
     beginning on the first date that any such grant is awarded to 
     the State, the State--
       (1) terminated the State's short-time compensation program; 
     or
       (2) failed to meet appropriate requirements with respect to 
     such program (as established by the Secretary).
       (g) Funding.--There are appropriated, out of moneys in the 
     Treasury not otherwise appropriated, to the Secretary, 
     $100,000,000 to carry out this section, to remain available 
     without fiscal year limitation.
       (h) Reporting.--The Secretary may establish reporting 
     requirements for States receiving a grant under this section 
     in order to provide oversight of grant funds.
       (i) Definitions.--In this section:
       (1) Secretary.--The term ``Secretary'' means the Secretary 
     of Labor.
       (2) Short-time compensation program.--The term ``short-time 
     compensation program'' has the meaning given such term in 
     section 3306(v) of the Internal Revenue Code of 1986, as 
     added by section 2161(a).
       (3) State; state agency; state law.--The terms ``State'', 
     ``State agency'', and ``State law'' have the meanings given 
     those terms in section 205 of the Federal-State Extended 
     Unemployment Compensation Act of 1970 (26 U.S.C. 3304 note).

     SEC. 2165. ASSISTANCE AND GUIDANCE IN IMPLEMENTING PROGRAMS.

       (a) In General.--In order to assist States in establishing, 
     qualifying, and implementing short-time compensation programs 
     (as defined in section 3306(v) of the Internal Revenue Code 
     of 1986, as added by section 2161(a)), the Secretary of Labor 
     (in this section referred to as the ``Secretary'') shall--
       (1) develop model legislative language which may be used by 
     States in developing and enacting such programs and 
     periodically review and revise such model legislative 
     language;
       (2) provide technical assistance and guidance in 
     developing, enacting, and implementing such programs;
       (3) establish reporting requirements for States, including 
     reporting on--
       (A) the number of estimated averted layoffs;
       (B) the number of participating employers and workers; and
       (C) such other items as the Secretary of Labor determines 
     are appropriate.
       (b) Model Language and Guidance.--The model language and 
     guidance developed under subsection (a) shall allow 
     sufficient flexibility by States and participating employers 
     while ensuring accountability and program integrity.
       (c) Consultation.--In developing the model legislative 
     language and guidance under subsection (a), and in order to 
     meet the requirements of subsection (b), the Secretary shall 
     consult with employers, labor organizations, State workforce 
     agencies, and other program experts.

     SEC. 2166. REPORTS.

       (a) Report.--
       (1) In general.--Not later than 4 years after the date of 
     the enactment of this Act, the Secretary of Labor shall 
     submit to Congress and to the President a report or reports 
     on the implementation of the provisions of this subtitle.

[[Page H841]]

       (2) Requirements.--Any report under paragraph (1) shall at 
     a minimum include the following:
       (A) A description of best practices by States and employers 
     in the administration, promotion, and use of short-time 
     compensation programs (as defined in section 3306(v) of the 
     Internal Revenue Code of 1986, as added by section 2161(a)).
       (B) An analysis of the significant challenges to State 
     enactment and implementation of short-time compensation 
     programs.
       (C) A survey of employers in all States to determine the 
     level of interest in participating in short-time compensation 
     programs.
       (b) Funding.--There are appropriated, out of any moneys in 
     the Treasury not otherwise appropriated, to the Secretary of 
     Labor, $1,500,000 to carry out this section, to remain 
     available without fiscal year limitation.

                 Subtitle E--Self-Employment Assistance

     SEC. 2181. STATE ADMINISTRATION OF SELF-EMPLOYMENT ASSISTANCE 
                   PROGRAMS.

       (a) Availability for Individuals Receiving Extended 
     Compensation.--Title II of the Federal-State Extended 
     Unemployment Compensation Act of 1970 (26 U.S.C. 3304 note) 
     is amended by inserting at the end the following new section:


       ``authority to conduct self-employment assistance programs

       ``Sec. 208.  (a)(1) At the option of a State, for any weeks 
     of unemployment beginning after the date of enactment of this 
     section, the State agency of the State may establish a self-
     employment assistance program, as described in subsection 
     (b), to provide for the payment of extended compensation as 
     self-employment assistance allowances to individuals who 
     would otherwise satisfy the eligibility criteria under this 
     title.
       ``(2) Subject to paragraph (3), the self-employment 
     assistance allowance described in paragraph (1) shall be paid 
     to an eligible individual from such individual's extended 
     compensation account, as described in section 202(b), and the 
     amount in such account shall be reduced accordingly.
       ``(3)(A) Subject to subparagraph (B), for purposes of self-
     employment assistance programs established under this section 
     and section 4001(j) of the Supplemental Appropriations Act, 
     2008, an individual shall be provided with self-employment 
     assistance allowances under such programs for a total of not 
     greater than 26 weeks (referred to in this section as the 
     `combined eligibility limit').
       ``(B) For purposes of an individual who is participating in 
     a self-employment assistance program established under this 
     section and has not reached the combined eligibility limit as 
     of the date on which such individual exhausts all rights to 
     extended compensation under this title, the individual shall 
     be eligible to receive self-employment assistance allowances 
     under a self-employment assistance program established under 
     section 4001(j) of the Supplemental Appropriations Act, 2008, 
     until such individual has reached the combined eligibility 
     limit, provided that the individual otherwise satisfies the 
     eligibility criteria described under title IV of such Act.
       ``(b) For the purposes of this section, the term `self-
     employment assistance program' means a program as defined 
     under section 3306(t) of the Internal Revenue Code of 1986, 
     except as follows:
       ``(1) all references to `regular unemployment compensation 
     under the State law' shall be deemed to refer instead to 
     `extended compensation under title II of the Federal-State 
     Extended Unemployment Compensation Act of 1970';
       ``(2) paragraph (3)(B) shall not apply;
       ``(3) clause (i) of paragraph (3)(C) shall be deemed to 
     state as follows:
       `` `(i) include any entrepreneurial training that the State 
     or non-profit organizations may provide in coordination with 
     programs of training offered by the Small Business 
     Administration, which may include business counseling, 
     mentorship for participants, access to small business 
     development resources, and technical assistance; and';
       ``(4) the reference to `5 percent' in paragraph (4) shall 
     be deemed to refer instead to `1 percent'; and
       ``(5) paragraph (5) shall not apply.
       ``(c) In the case of an individual who is eligible to 
     receive extended compensation under this title, such 
     individual shall not receive self-employment assistance 
     allowances under this section unless the State agency has a 
     reasonable expectation that such individual will be entitled 
     to at least 13 times the individual's average weekly benefit 
     amount of extended compensation and emergency unemployment 
     compensation.
       ``(d)(1) An individual who is participating in a self-
     employment assistance program established under this section 
     may elect to discontinue participation in such program at any 
     time.
       ``(2) For purposes of an individual whose participation in 
     a self-employment assistance program established under this 
     section is terminated pursuant to subsection (a)(3) or who 
     has discontinued participation in such program, if the 
     individual continues to satisfy the eligibility requirements 
     for extended compensation under this title, the individual 
     shall receive extended compensation payments with respect to 
     subsequent weeks of unemployment, to the extent that amounts 
     remain in the account established for such individual under 
     section 202(b).''.
       (b) Availability for Individuals Receiving Emergency 
     Unemployment Compensation.--Section 4001 of the Supplemental 
     Appropriations Act, 2008 (Public Law 110 252; 26 U.S.C. 3304 
     note), as amended by sections 2141(b) and 2142(a), is further 
     amended by inserting at the end the following new subsection:
       ``(j) Authority to Conduct Self-employment Assistance 
     Program.--
       ``(1) In general.--
       ``(A) Establishment.--Any agreement under subsection (a) 
     may provide that the State agency of the State shall 
     establish a self-employment assistance program, as described 
     in paragraph (2), to provide for the payment of emergency 
     unemployment compensation as self-employment assistance 
     allowances to individuals who would otherwise satisfy the 
     eligibility criteria specified in subsection (b).
       ``(B) Payment of allowances.--Subject to subparagraph (C), 
     the self-employment assistance allowance described in 
     subparagraph (A) shall be paid to an eligible individual from 
     such individual's emergency unemployment compensation 
     account, as described in section 4002, and the amount in such 
     account shall be reduced accordingly.
       ``(C) Limitation on self-employment assistance for 
     individuals receiving extended compensation and emergency 
     unemployment compensation.--
       ``(i) Combined eligibility limit.--Subject to clause (ii), 
     for purposes of self-employment assistance programs 
     established under this subsection and section 208 of the 
     Federal-State Extended Unemployment Compensation Act of 1970, 
     an individual shall be provided with self-employment 
     assistance allowances under such programs for a total of not 
     greater than 26 weeks (referred to in this subsection as the 
     `combined eligibility limit').
       ``(ii) Carryover rule.--For purposes of an individual who 
     is participating in a self-employment assistance program 
     established under this subsection and has not reached the 
     combined eligibility limit as of the date on which such 
     individual exhausts all rights to extended compensation under 
     this title, the individual shall be eligible to receive self-
     employment assistance allowances under a self-employment 
     assistance program established under section 208 of the 
     Federal-State Extended Unemployment Compensation Act of 1970 
     until such individual has reached the combined eligibility 
     limit, provided that the individual otherwise satisfies the 
     eligibility criteria described under title II of such Act.
       ``(2) Definition of `self-employment assistance program'.--
     For the purposes of this section, the term `self-employment 
     assistance program' means a program as defined under section 
     3306(t) of the Internal Revenue Code of 1986, except as 
     follows:
       ``(A) all references to `regular unemployment compensation 
     under the State law' shall be deemed to refer instead to 
     `emergency unemployment compensation under title IV of the 
     Supplemental Appropriations Act, 2008';
       ``(B) paragraph (3)(B) shall not apply;
       ``(C) clause (i) of paragraph (3)(C) shall be deemed to 
     state as follows:
       `` `(i) include any entrepreneurial training that the State 
     or non-profit organizations may provide in coordination with 
     programs of training offered by the Small Business 
     Administration, which may include business counseling, 
     mentorship for participants, access to small business 
     development resources, and technical assistance; and';
       ``(D) the reference to `5 percent' in paragraph (4) shall 
     be deemed to refer instead to `1 percent'; and
       ``(E) paragraph (5) shall not apply.
       ``(3) Availability of self-employment assistance 
     allowances.--In the case of an individual who is eligible to 
     receive emergency unemployment compensation payment under 
     this title, such individual shall not receive self-employment 
     assistance allowances under this subsection unless the State 
     agency has a reasonable expectation that such individual will 
     be entitled to at least 13 times the individual's average 
     weekly benefit amount of extended compensation and emergency 
     unemployment compensation.
       ``(4) Participant option to terminate participation in 
     self-employment assistance program.--
       ``(A) Termination.--An individual who is participating in a 
     self-employment assistance program established under this 
     subsection may elect to discontinue participation in such 
     program at any time.
       ``(B) Continued eligibility for emergency unemployment 
     compensation.--For purposes of an individual whose 
     participation in the self-employment assistance program 
     established under this subsection is terminated pursuant to 
     paragraph (1)(C) or who has discontinued participation in 
     such program, if the individual continues to satisfy the 
     eligibility requirements for emergency unemployment 
     compensation under this title, the individual shall receive 
     emergency unemployment compensation payments with respect to 
     subsequent weeks of unemployment, to the extent that amounts 
     remain in the account established for such individual under 
     section 4002(b) or to the extent that such individual 
     commences receiving the amounts described in subsections (c), 
     (d), or (e) of such section, respectively.''.

     SEC. 2182. GRANTS FOR SELF-EMPLOYMENT ASSISTANCE PROGRAMS.

       (a) In General.--
       (1) Establishment or improved administration.--Subject to 
     the requirements established under subsection (b), the 
     Secretary shall award grants to States for the purposes of--
       (A) improved administration of self-employment assistance 
     programs that have been established, prior to the date of the 
     enactment of this Act, pursuant to section 3306(t) of the 
     Internal Revenue Code of 1986 (26 U.S.C. 3306(t)), for 
     individuals who are eligible to receive regular unemployment 
     compensation;
       (B) development, implementation, and administration of 
     self-employment assistance programs that are established, 
     subsequent to the date of the enactment of this Act, pursuant 
     to section

[[Page H842]]

     3306(t) of the Internal Revenue Code of 1986, for individuals 
     who are eligible to receive regular unemployment 
     compensation; and
       (C) development, implementation, and administration of 
     self-employment assistance programs that are established 
     pursuant to section 208 of the Federal-State Extended 
     Unemployment Compensation Act of 1970 or section 4001(j) of 
     the Supplemental Appropriations Act, 2008, for individuals 
     who are eligible to receive extended compensation or 
     emergency unemployment compensation.
       (2) Promotion and enrollment.--Subject to the requirements 
     established under subsection (b), the Secretary shall award 
     additional grants to States that submit approved applications 
     for a grant under paragraph (1) for such States to promote 
     self-employment assistance programs and enroll unemployed 
     individuals in such programs.
       (b) Application and Disbursal.--
       (1) Application.--Any State seeking a grant under paragraph 
     (1) or (2) of subsection (a) shall submit an application to 
     the Secretary at such time, in such manner, and containing 
     such information as is determined appropriate by the 
     Secretary. In no case shall the Secretary award a grant under 
     this section with respect to an application that is submitted 
     after December 31, 2013.
       (2) Notice.--Not later than 30 days after receiving an 
     application described in paragraph (1) from a State, the 
     Secretary shall notify the State agency as to whether a grant 
     has been approved for such State for the purposes described 
     in subsection (a).
       (3) Certification.--If the Secretary determines that a 
     State has met the requirements for a grant under subsection 
     (a), the Secretary shall make a certification to that effect 
     to the Secretary of the Treasury, as well as a certification 
     as to the amount of the grant payment to be transferred to 
     the State account in the Unemployment Trust Fund under 
     section 904 of the Social Security Act (42 U.S.C. 1104). The 
     Secretary of the Treasury shall make the appropriate transfer 
     to the State account not later than 7 days after receiving 
     such certification.
       (c) Allotment Factors.--For purposes of allotting the funds 
     available under subsection (d) to States that have met the 
     requirements for a grant under this section, the amount of 
     the grant provided to each State shall be determined based 
     upon the percentage of unemployed individuals in the State 
     relative to the percentage of unemployed individuals in all 
     States.
       (d) Funding.--There are appropriated, out of moneys in the 
     Treasury not otherwise appropriated, $35,000,000 for the 
     period of fiscal year 2012 through fiscal year 2013 for 
     purposes of carrying out the grant program under this 
     section,

     SEC. 2183. ASSISTANCE AND GUIDANCE IN IMPLEMENTING SELF-
                   EMPLOYMENT ASSISTANCE PROGRAMS.

       (a) Model Language and Guidance.--For purposes of assisting 
     States in establishing, improving, and administering self-
     employment assistance programs, the Secretary shall--
       (1) develop model language that may be used by States in 
     enacting such programs, as well as periodically review and 
     revise such model language; and
       (2) provide technical assistance and guidance in 
     establishing, improving, and administering such programs.
       (b) Reporting and Evaluation.--
       (1) Reporting.--The Secretary shall establish reporting 
     requirements for States that have established self-employment 
     assistance programs, which shall include reporting on--
       (A) the total number of individuals who received 
     unemployment compensation and--
       (i) were referred to a self-employment assistance program;
       (ii) participated in such program; and
       (iii) received an allowance under such program;
       (B) the total amount of allowances provided to individuals 
     participating in a self-employment assistance program;
       (C) the total income (as determined by survey or other 
     appropriate method) for businesses that have been established 
     by individuals participating in a self-employment assistance 
     program, as well as the total number of individuals employed 
     through such businesses; and
       (D) any additional information, as determined appropriate 
     by the Secretary.
       (2) Evaluation.--Not later than 5 years after the date of 
     the enactment of this Act, the Secretary shall submit to 
     Congress a report that evaluates the effectiveness of self-
     employment assistance programs established by States, 
     including--
       (A) an analysis of the implementation and operation of 
     self-employment assistance programs by States;
       (B) an evaluation of the economic outcomes for individuals 
     who participated in a self-employment assistance program as 
     compared to individuals who received unemployment 
     compensation and did not participate in a self-employment 
     assistance program, including a comparison as to employment 
     status, income, and duration of receipt of unemployment 
     compensation or self-employment assistance allowances; and
       (C) an evaluation of the state of the businesses started by 
     individuals who participated in a self-employment assistance 
     program, including information regarding--
       (i) the type of businesses established;
       (ii) the sustainability of the businesses;
       (iii) the total income collected by the businesses;
       (iv) the total number of individuals employed through such 
     businesses; and
       (v) the estimated Federal and State tax revenue collected 
     from such businesses and their employees.
       (c) Flexibility and Accountability.--The model language, 
     guidance, and reporting requirements developed by the 
     Secretary under subsections (a) and (b) shall--
       (1) allow sufficient flexibility for States and 
     participating individuals; and
       (2) ensure accountability and program integrity.
       (d) Consultation.--For purposes of developing the model 
     language, guidance, and reporting requirements described 
     under subsections (a) and (b), the Secretary shall consult 
     with employers, labor organizations, State agencies, and 
     other relevant program experts.
       (e) Entrepreneurial Training Programs.--The Secretary shall 
     utilize resources available through the Department of Labor 
     and coordinate with the Administrator of the Small Business 
     Administration to ensure that adequate funding is reserved 
     and made available for the provision of entrepreneurial 
     training to individuals participating in self-employment 
     assistance programs.
       (f) Self-employment Assistance Program.--For purposes of 
     this section, the term ``self-employment assistance program'' 
     means a program established pursuant to section 3306(t) of 
     the Internal Revenue Code of 1986 (26 U.S.C. 3306(t)), 
     section 208 of the Federal-State Extended Unemployment 
     Compensation Act of 1970, or section 4001(j) of the 
     Supplemental Appropriations Act, 2008, for individuals who 
     are eligible to receive regular unemployment compensation, 
     extended compensation, or emergency unemployment 
     compensation.

     SEC. 2184. DEFINITIONS.

       In this subtitle:
       (1) Secretary.--The term ``Secretary'' means the Secretary 
     of Labor.
       (2) State; state agency.--The terms ``State'' and ``State 
     agency'' have the meanings given such terms under section 205 
     of the Federal-State Extended Unemployment Compensation Act 
     of 1970 (26 U.S.C. 3304 note).

            TITLE III--MEDICARE AND OTHER HEALTH PROVISIONS

                    Subtitle A--Medicare Extensions

     SEC. 3001. EXTENSION OF MMA SECTION 508 RECLASSIFICATIONS.

       (a) In General.--Section 106(a) of division B of the Tax 
     Relief and Health Care Act of 2006 (42 U.S.C. 1395 note), as 
     amended by section 117 of the Medicare, Medicaid, and SCHIP 
     Extension Act of 2007 (Public Law 110 173), section 124 of 
     the Medicare Improvements for Patients and Providers Act of 
     2008 (Public Law 110 275), sections 3137(a) and 10317 of the 
     Patient Protection and Affordable Care Act (Public Law 111 
     148), section 102(a) of the Medicare and Medicaid Extenders 
     Act of 2010 (Public Law 111 309), and section 302(a) of the 
     Temporary Payroll Tax Cut Continuation Act of 2011 (Public 
     Law 112 78), is amended by striking ``November 30, 2011'' and 
     inserting ``March 31, 2012''.
       (b) Special Rule.--
       (1) In general.--Subject to paragraph (2), for purposes of 
     implementation of the amendment made by subsection (a), 
     including for purposes of the implementation of paragraph (2) 
     of section 117(a) of the Medicare, Medicaid, and SCHIP 
     Extension Act of 2007 (Public Law 110 173), for the period 
     beginning on December 1, 2011, and ending on March 31, 2012, 
     the Secretary of Health and Human Services shall use the 
     hospital wage index that was promulgated by the Secretary of 
     Health and Human Services in the Federal Register on August 
     18, 2011 (76 Fed. Reg. 51476), and any subsequent 
     corrections.
       (2) Exception.--In determining the wage index applicable to 
     hospitals that qualify for wage index reclassification, the 
     Secretary shall, for the period described in paragraph (1), 
     include the average hourly wage data of hospitals whose 
     reclassification was extended pursuant to the amendment made 
     by subsection (a) only if including such data results in a 
     higher applicable reclassified wage index. Any revision to 
     hospital wage indexes made as a result of this paragraph 
     shall not be effected in a budget neutral manner.
       (c) Timeframe for Payments.--
       (1) In general.--The Secretary shall make payments required 
     under subsections (a) and (b) by not later than June 30, 
     2012.
       (2) October 2011 and november 2011 conforming change.--
     Section 302(c) of the Temporary Payroll Tax Cut Continuation 
     Act of 2011 (Public Law 112-78) is amended by striking 
     ``December 31, 2012'' and inserting ``June 30, 2012''.

     SEC. 3002. EXTENSION OF OUTPATIENT HOLD HARMLESS PAYMENTS.

       (a) In General.--Section 1833(t)(7)(D)(i) of the Social 
     Security Act (42 U.S.C. 1395l(t)(7)(D)(i)), as amended by 
     section 308 of the Temporary Payroll Tax Cut Continuation Act 
     of 2011 (Public Law 112 78), is amended--
       (1) in subclause (II)--
       (A) in the first sentence, by striking ``March 1, 2012'' 
     and inserting ``January 1, 2013''; and
       (B) in the second sentence, by striking ``or the first two 
     months of 2012'' and inserting ``or 2012''; and
       (2) in subclause (III), in the first sentence, by striking 
     ``March 1, 2012'' and inserting ``January 1, 2013''.
       (b) Report.--Not later than July 1, 2012, the Secretary of 
     Health and Human Services shall submit to the Committees on 
     Ways and Means and Energy and Commerce of the House of 
     Representatives and the Committee on Finance of the Senate a 
     report including recommendations for which types of hospitals 
     should continue to receive hold harmless payments described 
     in subclauses (II) and (III) of section 1833(t)(7)(D)(i) of 
     the Social Security Act (42 U.S.C. 1395l(t)(7)(D)(i)) in 
     order to maintain adequate beneficiary access to outpatient 
     services. In conducting such report, the Secretary should 
     examine why some similarly situated

[[Page H843]]

     hospitals do not receive such hold harmless payments and are 
     able to rely only on the prospective payment system for 
     hospital outpatient department services under section 1833(t) 
     of the Social Security Act (42 U.S.C. 1395l(t)).

     SEC. 3003. PHYSICIAN PAYMENT UPDATE.

       (a) In General.--Section 1848(d)(13) of the Social Security 
     Act (42 U.S.C. 1395w 4(d)(13)), as added by section 301 of 
     the Temporary Payroll Tax Cut Continuation Act of 2011 
     (Public Law 112 78), is amended--
       (1) in the heading, by striking ``first two months of 
     2012'' and inserting ``2012'';
       (2) in subparagraph (A), by striking ``the period beginning 
     on January 1, 2012, and ending on February 29, 2012'' and 
     inserting ``2012'';
       (3) in the heading of subparagraph (B), by striking 
     ``remaining portion of 2012'' and inserting ``2013''; and
       (4) in subparagraph (B), by striking ``for the period 
     beginning on March 1, 2012, and ending on December 31, 2012, 
     and for 2013'' and inserting ``for 2013''.
       (b) Mandated Studies on Physician Payment Reform.--
       (1) Study by secretary on options for bundled or episode-
     based payment.--
       (A) In general.--The Secretary of Health and Human Services 
     shall conduct a study that examines options for bundled or 
     episode-based payments, to cover physicians' services 
     currently paid under the physician fee schedule under section 
     1848 of the Social Security Act (42 U.S.C. 1395w 4), for one 
     or more prevalent chronic conditions (such as cancer, 
     diabetes, and congestive heart failure) or episodes of care 
     for one or more major procedures (such as medical device 
     implantation). In conducting the study, the Secretary shall 
     consult with medical professional societies and other 
     relevant stakeholders. The study shall include an examination 
     of related private payer payment initiatives.
       (B) Report.--Not later than January 1, 2013, the Secretary 
     shall submit to the Committees on Ways and Means and Energy 
     and Commerce of the House of Representatives and the 
     Committee on Finance of the Senate a report on the study 
     conducted under this paragraph. The Secretary shall include 
     in the report recommendations on suitable alternative payment 
     options for services paid under such fee schedule and on 
     associated implementation requirements (such as timelines, 
     operational issues, and interactions with other payment 
     reform initiatives).
       (2) GAO study of private payer initiatives.--
       (A) In general.--The Comptroller General of the United 
     States shall conduct a study that examines initiatives of 
     private entities offering or administering health insurance 
     coverage, group health plans, or other private health benefit 
     plans to base or adjust physician payment rates under such 
     coverage or plans for performance on quality and efficiency, 
     as well as demonstration of care delivery improvement 
     activities (such as adherence to evidence-based guidelines 
     and patient-shared decision making programs). In conducting 
     such study, the Comptroller General shall consult, to the 
     extent appropriate, with medical professional societies and 
     other relevant stakeholders.
       (B) Report.--Not later than January 1, 2013, the 
     Comptroller General shall submit to the Committees on Ways 
     and Means and Energy and Commerce of the House of 
     Representatives and the Committee on Finance of the Senate a 
     report on the study conducted under this paragraph. Such 
     report shall include an assessment of the applicability of 
     the payer initiatives described in subparagraph (A) to the 
     Medicare program and recommendations on modifications to 
     existing Medicare performance-based initiatives.

     SEC. 3004. WORK GEOGRAPHIC ADJUSTMENT.

       (a) In General.--Section 1848(e)(1)(E) of the Social 
     Security Act (42 U.S.C. 1395w 4(e)(1)(E)), as amended by 
     section 303 of the Temporary Payroll Tax Cut Continuation Act 
     of 2011 (Public Law 112 78), is amended by striking ``before 
     March 1, 2012'' and inserting ``before January 1, 2013''.
       (b) Report.--Not later than June 15, 2013, the Medicare 
     Payment Advisory Commission shall submit to the Committees on 
     Ways and Means and Energy and Commerce of the House of 
     Representatives and the Committee on Finance of the Senate a 
     report that assesses whether any adjustment under section 
     1848 of the Social Security Act (42 U.S.C. 1395w 4) to 
     distinguish the difference in work effort by geographic area 
     is appropriate and, if so, what that level should be and 
     where it should be applied. The report shall also assess the 
     impact of the work geographic adjustment under such section, 
     including the extent to which the floor on such adjustment 
     impacts access to care.

     SEC. 3005. PAYMENT FOR OUTPATIENT THERAPY SERVICES.

       (a) Application of Additional Requirements.--Section 
     1833(g)(5) of the Social Security Act (42 U.S.C. 
     1395l(g)(5)), as amended by section 304 of the Temporary 
     Payroll Tax Cut Continuation Act of 2011 (Public Law 112 78), 
     is amended--
       (1) by inserting ``(A)'' after ``(5)'';
       (2) in the first sentence, by striking ``February 29, 
     2012'' and inserting ``December 31, 2012'';
       (3) in the first sentence, by inserting ``and if the 
     requirement of subparagraph (B) is met'' after ``medically 
     necessary'';
       (4) in the second sentence, by inserting ``made in 
     accordance with such requirement'' after ``receipt of the 
     request''; and
       (5) by adding at the end the following new subparagraphs:
       ``(B) In the case of outpatient therapy services for which 
     an exception is requested under the first sentence of 
     subparagraph (A), the claim for such services shall contain 
     an appropriate modifier (such as the KX modifier used as of 
     the date of the enactment of this subparagraph) indicating 
     that such services are medically necessary as justified by 
     appropriate documentation in the medical record involved.
       ``(C)(i) In applying this paragraph with respect to a 
     request for an exception with respect to expenses that would 
     be incurred for outpatient therapy services (including 
     services described in subsection (a)(8)(B)) that would exceed 
     the threshold described in clause (ii) for a year, the 
     request for such an exception, for services furnished on or 
     after October 1, 2012, shall be subject to a manual medical 
     review process that is similar to the manual medical review 
     process used for certain exceptions under this paragraph in 
     2006.
       ``(ii) The threshold under this clause for a year is 
     $3,700. Such threshold shall be applied separately--
       ``(I) for physical therapy services and speech-language 
     pathology services; and
       ``(II) for occupational therapy services.''.
       (b) Temporary Application of Therapy Cap to Therapy 
     Furnished as Part of Hospital Outpatient Services.--Section 
     1833(g) of such Act (42 U.S.C.1395l(g)) is amended--
       (1) in each of paragraphs (1) and (3), by striking ``but 
     not described in section 1833(a)(8)(B)'' and inserting ``but 
     (except as provided in paragraph (6)) not described in 
     subsection (a)(8)(B)''; and
       (2) by adding at the end the following new paragraph:
       ``(6) In applying paragraphs (1) and (3) to services 
     furnished during the period beginning not later than October 
     1, 2012, and ending on December 31, 2012, the exclusion of 
     services described in subsection (a)(8)(B) from the uniform 
     dollar limitation specified in paragraph (2) shall not apply 
     to such services furnished during 2012.''.
       (c) Requirement for Inclusion on Claims of NPI of Physician 
     Who Reviews Therapy Plan.--Section 1842(t) of such Act (42 
     U.S.C. 1395u(t)) is amended--
       (1) by inserting ``(1)'' after ``(t)''; and
       (2) by adding at the end the following new paragraph:
       ``(2) Each request for payment, or bill submitted, for 
     therapy services described in paragraph (1) or (3) of section 
     1833(g), including services described in section 
     1833(a)(8)(B), furnished on or after October 1, 2012, for 
     which payment may be made under this part shall include the 
     national provider identifier of the physician who 
     periodically reviews the plan for such services under section 
     1861(p)(2).''.
       (d) Implementation.--The Secretary of Health and Human 
     Services shall implement such claims processing edits and 
     issue such guidance as may be necessary to implement the 
     amendments made by this section in a timely manner. 
     Notwithstanding any other provision of law, the Secretary may 
     implement the amendments made by this section by program 
     instruction. Of the amount of funds made available to the 
     Secretary for fiscal year 2012 for program management for the 
     Centers for Medicare & Medicaid Services, not to exceed 
     $9,375,000 shall be available for such fiscal year and the 
     first 3 months of fiscal year 2013 to carry out section 
     1833(g)(5)(C) of the Social Security Act (relating to manual 
     medical review), as added by subsection (a).
       (e) Effective Date.--The requirement of subparagraph (B) of 
     section 1833(g)(5) of the Social Security Act (42 U.S.C. 
     1395l(g)(5)), as added by subsection (a), shall apply to 
     services furnished on or after March 1, 2012.
       (f) MedPAC Report on Improved Medicare Therapy Benefits.--
     Not later than June 15, 2013, the Medicare Payment Advisory 
     Commission shall submit to the Committees on Energy and 
     Commerce and Ways and Means of the House of Representatives 
     and to the Committee on Finance of the Senate a report making 
     recommendations on how to improve the outpatient therapy 
     benefit under part B of title XVIII of the Social Security 
     Act. The report shall include recommendations on how to 
     reform the payment system for such outpatient therapy 
     services under such part so that the benefit is better 
     designed to reflect individual acuity, condition, and therapy 
     needs of the patient. Such report shall include an 
     examination of private sector initiatives relating to 
     outpatient therapy benefits.
       (g) Collection of Additional Data.--
       (1) Strategy.--The Secretary of Health and Human Services 
     shall implement, beginning on January 1, 2013, a claims-based 
     data collection strategy that is designed to assist in 
     reforming the Medicare payment system for outpatient therapy 
     services subject to the limitations of section 1833(g) of the 
     Social Security Act (42 U.S.C. 1395l(g)). Such strategy shall 
     be designed to provide for the collection of data on patient 
     function during the course of therapy services in order to 
     better understand patient condition and outcomes.
       (2) Consultation.--In proposing and implementing such 
     strategy, the Secretary shall consult with relevant 
     stakeholders.
       (h) GAO Report on Manual Medical Review Process 
     Implementation.--Not later than May 1, 2013, the Comptroller 
     General of the United States shall submit to the Committees 
     on Energy and Commerce and Ways and Means of the House of 
     Representatives and to the Committee on Finance of the Senate 
     a report on the implementation of the manual medical review 
     process referred to in section 1833(g)(5)(C) of the Social 
     Security Act, as added by subsection (a). Such report shall 
     include aggregate data on the number of individuals and 
     claims subject to such process, the number of reviews 
     conducted under such process, and the outcome of such 
     reviews.

     SEC. 3006. PAYMENT FOR TECHNICAL COMPONENT OF CERTAIN 
                   PHYSICIAN PATHOLOGY SERVICES.

       Section 542(c) of the Medicare, Medicaid, and SCHIP 
     Benefits Improvement and Protection

[[Page H844]]

     Act of 2000 (as enacted into law by section 1(a)(6) of Public 
     Law 106 554), as amended by section 732 of the Medicare 
     Prescription Drug, Improvement, and Modernization Act of 2003 
     (42 U.S.C. 1395w 4 note), section 104 of division B of the 
     Tax Relief and Health Care Act of 2006 (42 U.S.C. 1395w 4 
     note), section 104 of the Medicare, Medicaid, and SCHIP 
     Extension Act of 2007 (Public Law 110 173), section 136 of 
     the Medicare Improvements for Patients and Providers Act of 
     2008 (Public Law 110 275), section 3104 of the Patient 
     Protection and Affordable Care Act (Public Law 111 148), 
     section 105 of the Medicare and Medicaid Extenders Act of 
     2010 (Public Law 111 309), and section 305 of the Temporary 
     Payroll Tax Cut Continuation Act of 2011 (Public Law 112 78), 
     is amended by striking ``and the first two months of 2012'' 
     and inserting ``and the first six months of 2012''.

     SEC. 3007. AMBULANCE ADD-ON PAYMENTS.

       (a) Ground Ambulance.--Section 1834(l)(13)(A) of the Social 
     Security Act (42 U.S.C. 1395m(l)(13)(A)), as amended by 
     section 306(a) of the Temporary Payroll Tax Cut Continuation 
     Act of 2011 (Public Law 112 78), is amended--
       (1) in the matter preceding clause (i), by striking ``March 
     1, 2012'' and inserting ``January 1, 2013''; and
       (2) in each of clauses (i) and (ii), by striking ``March 1, 
     2012'' and inserting ``January 1, 2013'' each place it 
     appears.
       (b) Air Ambulance.--Section 146(b)(1) of the Medicare 
     Improvements for Patients and Providers Act of 2008 (Public 
     Law 110 275), as amended by sections 3105(b) and 10311(b) of 
     the Patient Protection and Affordable Care Act (Public Law 
     111 148), section 106(b) of the Medicare and Medicaid 
     Extenders Act of 2010 (Public Law 111 309) and section 306(b) 
     of the Temporary Payroll Tax Cut Continuation Act of 2011 
     (Public Law 112 78), is amended by striking ``February 29, 
     2012'' and inserting ``December 31, 2012''.
       (c) Super Rural Ambulance.--Section 1834(l)(12)(A) of the 
     Social Security Act (42 U.S.C. 1395m(l)(12)(A)), as amended 
     by section 306(c) of Temporary Payroll Tax Cut Continuation 
     Act of 2011 (Public Law 112 78), is amended in the first 
     sentence by striking ``March 1, 2012'' and inserting 
     ``January 1, 2013''.
       (d) GAO Report Update.--Not later than October 1, 2012, the 
     Comptroller General of the United States shall update the GAO 
     report GAO 07 383 (relating to Ambulance Providers: Costs and 
     Expected Medicare Margins Vary Greatly) to reflect current 
     costs for ambulance providers.
       (e) MedPAC Report.--The Medicare Payment Advisory 
     Commission shall conduct a study of--
       (1) the appropriateness of the add-on payments for 
     ambulance providers under paragraphs (12)(A) and (13)(A) of 
     section 1834(l) of the Social Security Act (42 U.S.C. 
     1395m(l)) and the treatment of air ambulance providers under 
     section 146(b)(1) of the Medicare Improvements for Patients 
     and Providers Act of 2008 (Public Law 110 275);
       (2) the effect these add-on payments and such treatment 
     have on the Medicare margins of ambulance providers; and
       (3) whether there is a need to reform the Medicare 
     ambulance fee schedule under such section and, if so, what 
     should such reforms be, including whether the add-on payments 
     should be included in the base rate.

     Not later than June 15, 2013, the Commission shall submit to 
     the Committees on Ways and Means and Energy and Commerce of 
     the House of Representatives and the Committee on Finance of 
     the Senate a report on such study and shall include in the 
     report such recommendations as the Commission deems 
     appropriate.

                  Subtitle B--Other Health Provisions

     SEC. 3101. QUALIFYING INDIVIDUAL PROGRAM.

       (a) Extension.--Section 1902(a)(10)(E)(iv) of the Social 
     Security Act (42 U.S.C. 1396a(a)(10)(E)(iv)), as amended by 
     section 310(a) of the Temporary Payroll Tax Cut Continuation 
     Act of 2011 (Public Law 112 78), is amended by striking 
     ``February'' and inserting ``December''.
       (b) Extending Total Amount Available for Allocation.--
     Section 1933(g) of such Act (42 U.S.C. 1396u 3(g)), as 
     amended by section 310(b) of the Temporary Payroll Tax Cut 
     Continuation Act of 2011 (Public Law 112 78), is amended--
       (1) in paragraph (2)--
       (A) in subparagraph (P), by striking ``and'' after the 
     semicolon;
       (B) in subparagraph (Q), by striking ``February 29, 2012, 
     the total allocation amount is $150,000,000.'' and inserting 
     ``September 30, 2012, the total allocation amount is 
     $450,000,000; and''; and
       (C) by adding at the end the following new subparagraph:
       ``(R) for the period that begins on October 1, 2012, and 
     ends on December 31, 2012, the total allocation amount is 
     $280,000,000.''; and
       (2) in paragraph (3), in the matter preceding subparagraph 
     (A), by striking ``or (P)'' and inserting ``(P), or (R)''.

     SEC. 3102. TRANSITIONAL MEDICAL ASSISTANCE.

       Sections 1902(e)(1)(B) and 1925(f) of the Social Security 
     Act (42 U.S.C. 1396a(e)(1)(B), 1396r 6(f)), as amended by 
     section 311 of the Temporary Payroll Tax Cut Continuation Act 
     of 2011 (Public Law 112 78), are each amended by striking 
     ``February 29'' and inserting ``December 31''.

                       Subtitle C--Health Offsets

     SEC. 3201. REDUCTION OF BAD DEBT TREATED AS AN ALLOWABLE 
                   COST.

       (a) Hospitals.--Section 1861(v)(1)(T) of the Social 
     Security Act (42 U.S.C. 1395x(v)(1)(T)) is amended--
       (1) in clause (iii), by striking ``and'' at the end;
       (2) in clause (iv)--
       (A) by striking ``a subsequent fiscal year'' and inserting 
     ``fiscal years 2001 through 2012''; and
       (B) by striking the period at the end and inserting ``, 
     and''; and
       (3) by adding at the end the following:
       ``(v) for cost reporting periods beginning during fiscal 
     year 2013 or a subsequent fiscal year, by 35 percent of such 
     amount otherwise allowable.''.
       (b) Skilled Nursing Facilities.--Section 1861(v)(1)(V) of 
     such Act (42 U.S.C. 1395x(v)(1)(V)) is amended--
       (1) in the matter preceding clause (i), by striking ``with 
     respect to cost reporting periods beginning on or after 
     October 1, 2005'' and inserting ``and (beginning with respect 
     to cost reporting periods beginning during fiscal year 2013) 
     for covered skilled nursing services described in section 
     1888(e)(2)(A) furnished by hospital providers of extended 
     care services (as described in section 1883)'';
       (2) in clause (i), by striking ``reduced by'' and all that 
     follows through ``allowable; and'' and inserting the 
     following: ``reduced by--
       ``(I) for cost reporting periods beginning on or after 
     October 1, 2005, but before fiscal year 2013, 30 percent of 
     such amount otherwise allowable; and
       ``(II) for cost reporting periods beginning during fiscal 
     year 2013 or a subsequent fiscal year, by 35 percent of such 
     amount otherwise allowable.''; and
       (3) in clause (ii), by striking ``such section shall not be 
     reduced.'' and inserting ``such section--
       ``(I) for cost reporting periods beginning on or after 
     October 1, 2005, but before fiscal year 2013, shall not be 
     reduced;
       ``(II) for cost reporting periods beginning during fiscal 
     year 2013, shall be reduced by 12 percent of such amount 
     otherwise allowable;
       ``(III) for cost reporting periods beginning during fiscal 
     year 2014, shall be reduced by 24 percent of such amount 
     otherwise allowable; and
       ``(IV) for cost reporting periods beginning during a 
     subsequent fiscal year, shall be reduced by 35 percent of 
     such amount otherwise allowable.''.
       (c) Certain Other Providers.--Section 1861(v)(1) of such 
     Act (42 U.S.C. 1395x(v)(1)) is amended by adding at the end 
     the following new subparagraph:
       ``(W)(i) In determining such reasonable costs for providers 
     described in clause (ii), the amount of bad debts otherwise 
     treated as allowable costs which are attributable to 
     deductibles and coinsurance amounts under this title shall be 
     reduced--
       ``(I) for cost reporting periods beginning during fiscal 
     year 2013, by 12 percent of such amount otherwise allowable;
       ``(II) for cost reporting periods beginning during fiscal 
     year 2014, by 24 percent of such amount otherwise allowable; 
     and
       ``(III) for cost reporting periods beginning during a 
     subsequent fiscal year, by 35 percent of such amount 
     otherwise allowable.
       ``(ii) A provider described in this clause is a provider of 
     services not described in subparagraph (T) or (V), a 
     supplier, or any other type of entity that receives payment 
     for bad debts under the authority under subparagraph (A).''.
       (d) Conforming Amendment for Hospital Services.--Section 
     4008(c) of the Omnibus Budget Reconciliation Act of 1987 (42 
     U.S.C. 1395 note), as amended by section 8402 of the 
     Technical and Miscellaneous Revenue Act of 1988 and section 
     6023 of the Omnibus Budget Reconciliation Act of 1989, is 
     amended by adding at the end the following new sentence: 
     ``Effective for cost reporting periods beginning on or after 
     October 1, 2012, the provisions of the previous two sentences 
     shall not apply.''.

     SEC. 3202. REBASE MEDICARE CLINICAL LABORATORY PAYMENT RATES.

       Section 1833(h)(2)(A) of the Social Security Act (42 U.S.C. 
     1395l(h)(2)(A)) is amended--
       (1) in clause (i), by striking ``paragraph (4)'' and 
     inserting ``clause (v), subparagraph (B), and paragraph 
     (4)'';
       (2) by moving clause (iv), subclauses (I) and (II) of such 
     clause, and the flush matter at the end of such clause 6 ems 
     to the left; and
       (3) by adding at the end the following new clause:
       ``(v) The Secretary shall reduce by 2 percent the fee 
     schedules otherwise determined under clause (i) for 2013, and 
     such reduced fee schedules shall serve as the base for 2014 
     and subsequent years.''.

     SEC. 3203. REBASING STATE DSH ALLOTMENTS FOR FISCAL YEAR 
                   2021.

       Section 1923(f) of the Social Security Act (42 U.S.C. 1396r 
     4(f)) is amended--
       (1) by redesignating paragraph (8) as paragraph (9);
       (2) in paragraph (3)(A) by striking ``paragraphs (6) and 
     (7)'' and inserting ``paragraphs (6), (7), and (8)''; and
       (3) by inserting after paragraph (7) the following new 
     paragraph:
       ``(8) Rebasing of state dsh allotments for fiscal year 
     2021.--With respect to fiscal year 2021, for purposes of 
     applying paragraph (3)(A) to determine the DSH allotment for 
     a State, the amount of the DSH allotment for the State under 
     paragraph (3) for fiscal year 2020 shall be equal to the DSH 
     allotment as reduced under paragraph (7).''.

     SEC. 3204. TECHNICAL CORRECTION TO THE DISASTER RECOVERY FMAP 
                   PROVISION.

       (a) In General.--Section 1905(aa) of the Social Security 
     Act (42 U.S.C. 1396d(aa)) is amended--
       (1) in paragraph (1)--
       (A) in subparagraph (A), by striking ``the Federal medical 
     assistance percentage determined for the fiscal year'' and 
     all that follows through the period and inserting ``the 
     State's

[[Page H845]]

     regular FMAP shall be increased by 50 percent of the number 
     of percentage points by which the State's regular FMAP for 
     such fiscal year is less than the Federal medical assistance 
     percentage determined for the State for the preceding fiscal 
     year after the application of only subsection (a) of section 
     5001 of Public Law 111 5 (if applicable to the preceding 
     fiscal year) and without regard to this subsection, 
     subsections (y) and (z), and subsections (b) and (c) of 
     section 5001 of Public Law 111 5.''; and
       (B) in subparagraph (B), by striking ``Federal medical 
     assistance percentage determined for the preceding fiscal 
     year'' and all that follows through the period and inserting 
     ``State's regular FMAP for such fiscal year shall be 
     increased by 25 percent of the number of percentage points by 
     which the State's regular FMAP for such fiscal year is less 
     than the Federal medical assistance percentage received by 
     the State during the preceding fiscal year.'';
       (2) in paragraph (2)--
       (A) in subparagraph (A)--
       (i) by striking ``Federal medical assistance percentage 
     determined for the State for the fiscal year'' and all that 
     follows through ``Act,'' and inserting ``State's regular FMAP 
     for the fiscal year''; and
       (ii) by striking ``subsection (y)'' and inserting 
     ``subsections (y) and (z)''; and
       (B) in subparagraph (B), by striking ``Federal medical 
     assistance percentage determined for the State for the fiscal 
     year'' and all that follows through ``Act,'' and inserting 
     ``State's regular FMAP for the fiscal year'';
       (3) by redesignating paragraph (3) as paragraph (4); and
       (4) by inserting after paragraph (2) the following:
       ``(3) In this subsection, the term `regular FMAP' means, 
     for each fiscal year for which this subsection applies to a 
     State, the Federal medical assistance percentage that would 
     otherwise apply to the State for the fiscal year, as 
     determined under subsection (b) and without regard to this 
     subsection, subsections (y) and (z), and section 10202 of the 
     Patient Protection and Affordable Care Act.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall take effect on October 1, 2013.

     SEC. 3205. PREVENTION AND PUBLIC HEALTH FUND.

       Section 4002(b) of the Patient Protection and Affordable 
     Care Act (42 U.S.C. 300u 11(b)) is amended by striking 
     paragraphs (2) through (6) and inserting the following:
       ``(2) for each of fiscal years 2012 through 2017, 
     $1,000,000,000;
       ``(3) for each of fiscal years 2018 and 2019, 
     $1,250,000,000;
       ``(4) for each of fiscal years 2020 and 2021, 
     $1,500,000,000; and
       ``(5) for fiscal year 2022, and each fiscal year 
     thereafter, $2,000,000,000.''.

                        TITLE IV--TANF EXTENSION

     SEC. 4001. SHORT TITLE.

       This title may be cited as the ``Welfare Integrity and Data 
     Improvement Act''.

     SEC. 4002. EXTENSION OF PROGRAM.

       (a) Family Assistance Grants.--Section 403(a)(1) of the 
     Social Security Act (42 U.S.C. 603(a)(1)) is amended--
       (1) in subparagraph (A), by striking ``each of fiscal years 
     1996'' and all that follows through ``2003'' and inserting 
     ``fiscal year 2012'';
       (2) in subparagraph (B)--
       (A) by inserting ``(as in effect just before the enactment 
     of the Welfare Integrity and Data Improvement Act)'' after 
     ``this paragraph'' the 1st place it appears; and
       (B) by inserting ``(as so in effect)'' after ``this 
     paragraph'' the 2nd place it appears; and
       (3) in subparagraph (C), by striking ``2003'' and inserting 
     ``2012''.
       (b) Healthy Marriage Promotion and Responsible Fatherhood 
     Grants.--Section 403(a)(2)(D) of such Act (42 U.S.C. 
     603(a)(2)(D)) is amended by striking ``2011'' each place it 
     appears and inserting ``2012''.
       (c) Maintenance of Effort Requirement.--Section 409(a)(7) 
     of such Act (42 U.S.C. 609(a)(7)) is amended--
       (1) in subparagraph (A), by striking ``fiscal year'' and 
     all that follows through ``2013'' and inserting ``a fiscal 
     year''; and
       (2) in subparagraph (B)(ii)--
       (A) by striking ``for fiscal years 1997 through 2012,''; 
     and
       (B) by striking ``407(a) for the fiscal year,'' and 
     inserting ``407(a),''.
       (d) Tribal Grants.--Section 412(a) of such Act (42 U.S.C. 
     612(a)) is amended in each of paragraphs (1)(A) and (2)(A) by 
     striking ``each of fiscal years 1997'' and all that follows 
     through ``2003'' and inserting ``fiscal year 2012''.
       (e) Studies and Demonstrations.--Section 413(h)(1) of such 
     Act (42 U.S.C. 613(h)(1)) is amended by striking ``each of 
     fiscal years 1997 through 2002'' and inserting ``fiscal year 
     2012''.
       (f) Census Bureau Study.--Section 414(b) of such Act (42 
     U.S.C. 614(b)) is amended by striking ``each of fiscal years 
     1996'' and all that follows through ``2003'' and inserting 
     ``fiscal year 2012''.
       (g) Child Care Entitlement.--Section 418(a)(3) of such Act 
     (42 U.S.C. 618(a)(3)) is amended by striking ``appropriated'' 
     and all that follows and inserting ``appropriated 
     $2,917,000,000 for fiscal year 2012.''.
       (h) Grants to Territories.--Section 1108(b)(2) of such Act 
     (42 U.S.C. 1308(b)(2)) is amended by striking ``fiscal years 
     1997 through 2003'' and inserting ``fiscal year 2012''.
       (i) Prevention of Duplicate Appropriations for Fiscal Year 
     2012.--Expenditures made pursuant to the Short-Term TANF 
     Extension Act (Public Law 112 35) and the Temporary Payroll 
     Tax Cut Continuation Act of 2011 (Public Law 112 78) for 
     fiscal year 2012 shall be charged to the applicable 
     appropriation or authorization provided by the amendments 
     made by this section for such fiscal year.
       (j) Effective Date.--This section and the amendments made 
     by this section shall take effect on the date of the 
     enactment of this Act.

     SEC. 4003. DATA EXCHANGE STANDARDIZATION FOR IMPROVED 
                   INTEROPERABILITY.

       (a) In General.--Section 411 of the Social Security Act (42 
     U.S.C. 611) is amended by adding at the end the following:
       ``(d) Data Exchange Standardization for Improved 
     Interoperability.--
       ``(1) Data exchange standards.--
       ``(A) Designation.--The Secretary, in consultation with an 
     interagency work group which shall be established by the 
     Office of Management and Budget, and considering State and 
     tribal perspectives, shall, by rule, designate a data 
     exchange standard for any category of information required to 
     be reported under this part.
       ``(B) Data exchange standards must be nonproprietary and 
     interoperable.--The data exchange standard designated under 
     subparagraph (A) shall, to the extent practicable, be 
     nonproprietary and interoperable.
       ``(C) Other requirements.--In designating data exchange 
     standards under this section, the Secretary shall, to the 
     extent practicable, incorporate--
       ``(i) interoperable standards developed and maintained by 
     an international voluntary consensus standards body, as 
     defined by the Office of Management and Budget, such as the 
     International Organization for Standardization;
       ``(ii) interoperable standards developed and maintained by 
     intergovernmental partnerships, such as the National 
     Information Exchange Model; and
       ``(iii) interoperable standards developed and maintained by 
     Federal entities with authority over contracting and 
     financial assistance, such as the Federal Acquisition 
     Regulatory Council.
       ``(2) Data exchange standards for reporting.--
       ``(A) Designation.--The Secretary, in consultation with an 
     interagency work group established by the Office of 
     Management and Budget, and considering State and tribal 
     perspectives, shall, by rule, designate data exchange 
     standards to govern the data reporting required under this 
     part.
       ``(B) Requirements.--The data exchange standards required 
     by subparagraph (A) shall, to the extent practicable--
       ``(i) incorporate a widely-accepted, nonproprietary, 
     searchable, computer-readable format;
       ``(ii) be consistent with and implement applicable 
     accounting principles; and
       ``(iii) be capable of being continually upgraded as 
     necessary.
       ``(C) Incorporation of nonproprietary standards.--In 
     designating reporting standards under this paragraph, the 
     Secretary shall, to the extent practicable, incorporate 
     existing nonproprietary standards, such as the eXtensible 
     Markup Language.''.
       (b) Effective Dates.--
       (1) Data exchange standards.--The Secretary of Health and 
     Human Services shall issue a proposed rule under section 
     411(d)(1) of the Social Security Act within 12 months after 
     the date of the enactment of this section, and shall issue a 
     final rule under such section 411(d)(1), after public 
     comment, within 24 months after such date of enactment.
       (2) Data reporting standards.--The reporting standards 
     required under section 411(d)(2) of such Act shall become 
     effective with respect to reports required in the first 
     reporting period, after the effective date of the final rule 
     referred to in paragraph (1) of this subsection, for which 
     the authority for data collection and reporting is 
     established or renewed under the Paperwork Reduction Act.

     SEC. 4004. SPENDING POLICIES FOR ASSISTANCE UNDER STATE TANF 
                   PROGRAMS.

       (a) State Requirement.--Section 408(a) of the Social 
     Security Act (42 U.S.C. 608(a)) is amended by adding at the 
     end the following:
       ``(12) State requirement to prevent unauthorized spending 
     of benefits.--
       ``(A) In general.--A State to which a grant is made under 
     section 403 shall maintain policies and practices as 
     necessary to prevent assistance provided under the State 
     program funded under this part from being used in any 
     electronic benefit transfer transaction in--
       ``(i) any liquor store;
       ``(ii) any casino, gambling casino, or gaming 
     establishment; or
       ``(iii) any retail establishment which provides adult-
     oriented entertainment in which performers disrobe or perform 
     in an unclothed state for entertainment.
       ``(B) Definitions.--For purposes of subparagraph (A)--
       ``(i) Liquor store.--The term `liquor store' means any 
     retail establishment which sells exclusively or primarily 
     intoxicating liquor. Such term does not include a grocery 
     store which sells both intoxicating liquor and groceries 
     including staple foods (within the meaning of section 3(r) of 
     the Food and Nutrition Act of 2008 (7 U.S.C. 2012(r))).
       ``(ii) Casino, gambling casino, or gaming establishment.--
     The terms `casino', `gambling casino', and `gaming 
     establishment' do not include--

       ``(I) a grocery store which sells groceries including such 
     staple foods and which also offers, or is located within the 
     same building or complex as, casino, gambling, or gaming 
     activities; or
       ``(II) any other establishment that offers casino, 
     gambling, or gaming activities incidental to the principal 
     purpose of the business.

       ``(iii) Electronic benefit transfer transaction.--The term 
     `electronic benefit transfer transaction' means the use of a 
     credit or debit card service, automated teller machine, 
     point-of-sale terminal, or access to an online system for the 
     withdrawal of funds or the processing of a payment for 
     merchandise or a service.''.

[[Page H846]]

       (b) Penalty.--Section 409(a) of such Act (42 U.S.C. 609(a)) 
     is amended by adding at the end the following:
       ``(16) Penalty for failure to enforce spending policies.--
       ``(A) In general.--If, within 2 years after the date of the 
     enactment of this paragraph, any State has not reported to 
     the Secretary on such State's implementation of the policies 
     and practices required by section 408(a)(12), or the 
     Secretary determines, based on the information provided in 
     State reports, that any State has not implemented and 
     maintained such policies and practices, the Secretary shall 
     reduce, by an amount equal to 5 percent of the State family 
     assistance grant, the grant payable to such State under 
     section 403(a)(1) for--
       ``(i) the fiscal year immediately succeeding the year in 
     which such 2-year period ends; and
       ``(ii) each succeeding fiscal year in which the State does 
     not demonstrate that such State has implemented and 
     maintained such policies and practices.
       ``(B) Reduction of applicable penalty.--The Secretary may 
     reduce the amount of the reduction required under 
     subparagraph (A) based on the degree of noncompliance of the 
     State.
       ``(C) State not responsible for individual violations.--
     Fraudulent activity by any individual in an attempt to 
     circumvent the policies and practices required by section 
     408(a)(12) shall not trigger a State penalty under 
     subparagraph (A).''.
       (c) Additional State Plan Requirements.--Section 
     402(a)(1)(A) of such Act (42 U.S.C. 602(a)(1)(A)) is amended 
     by adding at the end the following:
       ``(vii) Implement policies and procedures as necessary to 
     prevent access to assistance provided under the State program 
     funded under this part through any electronic fund 
     transaction in an automated teller machine or point-of-sale 
     device located in a place described in section 408(a)(12), 
     including a plan to ensure that recipients of the assistance 
     have adequate access to their cash assistance.
       ``(viii) Ensure that recipients of assistance provided 
     under the State program funded under this part have access to 
     using or withdrawing assistance with minimal fees or charges, 
     including an opportunity to access assistance with no fee or 
     charges, and are provided information on applicable fees and 
     surcharges that apply to electronic fund transactions 
     involving the assistance, and that such information is made 
     publicly available.''.
       (d) Conforming Amendment.--Section 409(c)(4) of such Act 
     (42 U.S.C. 609(c)(4)) is amended by striking ``or (13)'' and 
     inserting ``(13), or (16)''.

     SEC. 4005. TECHNICAL CORRECTIONS.

       (a) Section 404(d)(1)(A) of the Social Security Act (42 
     U.S.C. 604(d)(1)(A)) is amended by striking ``subtitle 1 of 
     Title'' and inserting ``Subtitle A of title''.
       (b) Sections 407(c)(2)(A)(i) and 409(a)(3)(C) of such Act 
     (42 U.S.C. 607(c)(2)(A)(i) and 609(a)(3)(C)) are each amended 
     by striking ``403(b)(6)'' and inserting ``403(b)(5)''.
       (c) Section 409(a)(2)(A) of such Act (42 U.S.C. 
     609(a)(2)(A)) is amended by moving clauses (i) and (ii) 2 ems 
     to the right.
       (d) Section 409(c)(2) of such Act (42 U.S.C. 609(c)(2)) is 
     amended by inserting a comma after ``appropriate''.
       (e) Section 411(a)(1)(A)(ii)(III) of such Act (42 U.S.C. 
     611(a)(1)(A)(ii)(III)) is amended by striking the last close 
     parenthesis.

                 TITLE V--FEDERAL EMPLOYEES RETIREMENT

     SEC. 5001. INCREASE IN CONTRIBUTIONS TO FEDERAL EMPLOYEES' 
                   RETIREMENT SYSTEM FOR NEW EMPLOYEES.

       (a) Definitions.--Section 8401 of title 5, United States 
     Code, is amended--
       (1) in paragraph (35), by striking ``and'' at the end;
       (2) in paragraph (36), by striking the period and inserting 
     ``; and''; and
       (3) by adding at the end the following:
       ``(37) the term `revised annuity employee' means any 
     individual who--
       ``(A) on December 31, 2012--
       ``(i) is not an employee or Member covered under this 
     chapter;
       ``(ii) is not performing civilian service which is 
     creditable service under section 8411; and
       ``(iii) has less than 5 years of creditable civilian 
     service under section 8411; and
       ``(B) after December 31, 2012, becomes employed as an 
     employee or becomes a Member covered under this chapter 
     performing service which is creditable service under section 
     8411.''.
       (b) Increase in Contributions.--Section 8422(a)(3) of title 
     5, United States Code, is amended--
       (1) by striking ``The applicable percentage under this 
     paragraph for civilian service'' and inserting ``(A) The 
     applicable percentage under this paragraph for civilian 
     service by employees or Members other than revised annuity 
     employees''; and
       (2) by adding at the end the following:
       ``(B) The applicable percentage under this paragraph for 
     civilian service by revised annuity employees shall be as 
     follows:

------------------------------------------------------------------------
 
------------------------------------------------------------------------
``Employee                           9.3               After December
                                                        31, 2012.
Congressional employee               9.3               After December
                                                        31, 2012.
Member                               9.3               After December
                                                        31, 2012.
Law enforcement officer,             9.8               After December
 firefighter, member of the Capitol                     31, 2012.
 Police, member of the Supreme
 Court Police, or air traffic
 controller
Nuclear materials courier            9.8               After December
                                                        31, 2012.
Customs and border protection        9.8               After December
 officer                                                31, 2012.''.
------------------------------------------------------------------------

       (c) Reduction in Congressional Annuities.--
       (1) In general.--Section 8415 of title 5, United States 
     Code, is amended--
       (A) by redesignating subsections (d) through (m) as 
     subsections (e) through (n), respectively; and
       (B) by inserting after subsection (c) the following:
       ``(d) Notwithstanding any other provision of law, the 
     annuity of an individual described in subsection (b) or (c) 
     who is a revised annuity employee shall be computed in the 
     same manner as in the case of an individual described in 
     subsection (a).''.
       (2) Technical and conforming amendments.--
       (A) Section 8422(d)(2) of title 5, United States Code, is 
     amended by striking ``section 8415(l)'' and inserting 
     ``section 8415(m)''.
       (B) Section 8452(d)(1) of title 5, United States Code, is 
     amended by striking ``subsection (g)'' and inserting 
     ``subsection (h)''.
       (C) Section 8468(b)(1)(A) of title 5, United States Code, 
     is amended by striking ``section 8415(a) through (h)'' and 
     inserting ``section 8415(a) through (i)''.
       (D) Section 805(a)(2)(B) of the Foreign Service Act of 1980 
     (22 U.S.C. 4045(a)(2)(B)) is amended by striking ``section 
     8415(d)'' and inserting ``section 8415(e)''.
       (E) Section 806(a) of the Foreign Service Act of 1980 (22 
     U.S.C. 4046(a)) is amended by striking ``section 8415(d)'' 
     each place it appears and inserting ``section 8415(e)''.
       (F) Section 855(b) of the Foreign Service Act of 1980 (22 
     U.S.C. 4071d(b)) is amended--
       (i) in paragraph (2)(A), by striking ``section 8415(d)(1)'' 
     and inserting ``section 8415(e)(1)''; and
       (ii) in paragraph (5), by striking ``section 8415(f)(1)'' 
     and inserting ``section 8415(g)(1)''.
       (G) Section 303(b)(1) of the Central Intelligence Agency 
     Retirement Act (50 U.S.C. 2153(b)(1)) is amended by striking 
     ``section 8415(d)'' and inserting ``section 8415(e)''.

     SEC. 5002. FOREIGN SERVICE PENSION SYSTEM.

       (a) Definition.--Section 852 of the Foreign Service Act of 
     1980 (22 U.S.C. 4071a) is amended--
       (1) by redesignating paragraphs (7), (8), and (9) as 
     paragraphs (8), (9), and (10), respectively; and
       (2) by inserting after paragraph (6) the following:
       ``(7) the term `revised annuity participant' means any 
     individual who--
       ``(A) on December 31, 2012--
       ``(i) is not a participant;
       ``(ii) is not performing service which is creditable 
     service under section 854; and
       ``(iii) has less than 5 years creditable service under 
     section 854; and
       ``(B) after December 31, 2012, becomes a participant 
     performing service which is creditable service under section 
     854;''.
       (b) Deductions and Withholdings From Pay.--Section 
     856(a)(2) of the Foreign Service Act of 1980 (22 U.S.C. 
     4071e(a)(2)) is amended--
       (1) by striking ``The applicable percentage under this 
     subsection'' and inserting ``(A) The applicable percentage 
     for a participant other than a revised annuity participant''; 
     and
       (2) by adding at the end the following:
       ``(B) The applicable percentage for a revised annuity 
     participant shall be as follows:

``9.85.......................................After December 31, 2012''.

     SEC. 5003. CENTRAL INTELLIGENCE AGENCY RETIREMENT AND 
                   DISABILITY SYSTEM.

       Section 211(a) of the Central Intelligence Agency 
     Retirement Act (50 U.S.C. 2021(a)) is amended--
       (1) by redesignating paragraph (3) as paragraph (4); and
       (2) by striking paragraphs (1) and (2) and inserting the 
     following:
       ``(1) Definition.--In this subsection, the term `revised 
     annuity participant' means an individual who--
       ``(A) on December 31, 2012--
       ``(i) is not a participant;
       ``(ii) is not performing qualifying service; and
       ``(iii) has less than 5 years of qualifying service; and
       ``(B) after December 31, 2012, becomes a participant 
     performing qualifying service.
       ``(2) Contributions.--
       ``(A) In general.--Except as provided in subsection (d), 7 
     percent of the basic pay received by a participant other than 
     a revised annuity participant for any pay period shall be 
     deducted and withheld from the pay of that participant and 
     contributed to the fund.
       ``(B) Revised annuity participants.--Except as provided in 
     subsection (d), 9.3 percent of the basic pay received by a 
     revised annuity participant for any pay period shall be 
     deducted and withheld from the pay of that revised annuity 
     participant and contributed to the fund.
       ``(3) Agency contributions.--
       ``(A) In general.--An amount equal to 7 percent of the 
     basic pay received by a participant other than a revised 
     annuity participant shall be contributed to the fund for a 
     pay period for the participant from the appropriation or fund 
     which is used for payment of the participant's basic pay.
       ``(B) Revised annuity participants.--An amount equal to 4.7 
     percent of the basic pay received by a revised annuity 
     participant shall be contributed to the fund for a pay period 
     for the revised annuity participant from

[[Page H847]]

     the appropriation or fund which is used for payment of the 
     revised annuity participant's basic pay.''.

  TITLE VI--PUBLIC SAFETY COMMUNICATIONS AND ELECTROMAGNETIC SPECTRUM 
                                AUCTIONS

     SEC. 6001. DEFINITIONS.

       In this title:
       (1) 700 mhz band.--The term ``700 MHz band'' means the 
     portion of the electromagnetic spectrum between the 
     frequencies from 698 megahertz to 806 megahertz.
       (2) 700 mhz d block spectrum.--The term ``700 MHz D block 
     spectrum'' means the portion of the electromagnetic spectrum 
     between the frequencies from 758 megahertz to 763 megahertz 
     and between the frequencies from 788 megahertz to 793 
     megahertz.
       (3) Appropriate committees of congress.--Except as 
     otherwise specifically provided, the term ``appropriate 
     committees of Congress'' means--
       (A) the Committee on Commerce, Science, and Transportation 
     of the Senate; and
       (B) the Committee on Energy and Commerce of the House of 
     Representatives.
       (4) Assistant secretary.--The term ``Assistant Secretary'' 
     means the Assistant Secretary of Commerce for Communications 
     and Information.
       (5) Board.--The term ``Board'' means the Board of the First 
     Responder Network Authority established under section 
     6204(b).
       (6) Broadcast television licensee.--The term ``broadcast 
     television licensee'' means the licensee of--
       (A) a full-power television station; or
       (B) a low-power television station that has been accorded 
     primary status as a Class A television licensee under section 
     73.6001(a) of title 47, Code of Federal Regulations.
       (7) Broadcast television spectrum.--The term ``broadcast 
     television spectrum'' means the portions of the 
     electromagnetic spectrum between the frequencies from 54 
     megahertz to 72 megahertz, from 76 megahertz to 88 megahertz, 
     from 174 megahertz to 216 megahertz, and from 470 megahertz 
     to 698 megahertz.
       (8) Commercial mobile data service.--The term ``commercial 
     mobile data service'' means any mobile service (as defined in 
     section 3 of the Communications Act of 1934 (47 U.S.C. 153)) 
     that is--
       (A) a data service;
       (B) provided for profit; and
       (C) available to the public or such classes of eligible 
     users as to be effectively available to a substantial portion 
     of the public, as specified by regulation by the Commission.
       (9) Commercial mobile service.--The term ``commercial 
     mobile service'' has the meaning given such term in section 
     332 of the Communications Act of 1934 (47 U.S.C. 332).
       (10) Commercial standards.--The term ``commercial 
     standards'' means the technical standards followed by the 
     commercial mobile service and commercial mobile data service 
     industries for network, device, and Internet Protocol 
     connectivity. Such term includes standards developed by the 
     Third Generation Partnership Project (3GPP), the Institute of 
     Electrical and Electronics Engineers (IEEE), the Alliance for 
     Telecommunications Industry Solutions (ATIS), the Internet 
     Engineering Task Force (IETF), and the International 
     Telecommunication Union (ITU).
       (11) Commission.--The term ``Commission'' means the Federal 
     Communications Commission.
       (12) Core network.--The term ``core network'' means the 
     core network described in section 6202(b)(1).
       (13) Emergency call.--The term ``emergency call'' means any 
     real-time communication with a public safety answering point 
     or other emergency management or response agency, including--
       (A) through voice, text, or video and related data; and
       (B) nonhuman-initiated automatic event alerts, such as 
     alarms, telematics, or sensor data, which may also include 
     real-time voice, text, or video communications.
       (14) Existing public safety broadband spectrum.--The term 
     ``existing public safety broadband spectrum'' means the 
     portion of the electromagnetic spectrum between the 
     frequencies--
       (A) from 763 megahertz to 768 megahertz;
       (B) from 793 megahertz to 798 megahertz;
       (C) from 768 megahertz to 769 megahertz; and
       (D) from 798 megahertz to 799 megahertz.
       (15) First responder network authority.--The term ``First 
     Responder Network Authority'' means the First Responder 
     Network Authority established under section 6204.
       (16) Forward auction.--The term ``forward auction'' means 
     the portion of an incentive auction of broadcast television 
     spectrum under section 6403(c).
       (17) Incentive auction.--The term ``incentive auction'' 
     means a system of competitive bidding under subparagraph (G) 
     of section 309(j)(8) of the Communications Act of 1934, as 
     added by section 6402.
       (18) Interoperability board.--The term ``Interoperability 
     Board'' means the Technical Advisory Board for First 
     Responder Interoperability established under section 6203.
       (19) Multichannel video programming distributor.--The term 
     ``multichannel video programming distributor'' has the 
     meaning given such term in section 602 of the Communications 
     Act of 1934 (47 U.S.C. 522).
       (20) Narrowband spectrum.--The term ``narrowband spectrum'' 
     means the portion of the electromagnetic spectrum between the 
     frequencies from 769 megahertz to 775 megahertz and between 
     the frequencies from 799 megahertz to 805 megahertz.
       (21) Nationwide public safety broadband network.--The term 
     ``nationwide public safety broadband network'' means the 
     nationwide, interoperable public safety broadband network 
     described in section 6202.
       (22) Next generation 9 1 1 services.--The term ``Next 
     Generation 9 1 1 services'' means an IP-based system 
     comprised of hardware, software, data, and operational 
     policies and procedures that--
       (A) provides standardized interfaces from emergency call 
     and message services to support emergency communications;
       (B) processes all types of emergency calls, including 
     voice, text, data, and multimedia information;
       (C) acquires and integrates additional emergency call data 
     useful to call routing and handling;
       (D) delivers the emergency calls, messages, and data to the 
     appropriate public safety answering point and other 
     appropriate emergency entities;
       (E) supports data or video communications needs for 
     coordinated incident response and management; and
       (F) provides broadband service to public safety answering 
     points or other first responder entities.
       (23) NIST.--The term ``NIST'' means the National Institute 
     of Standards and Technology.
       (24) NTIA.--The term ``NTIA'' means the National 
     Telecommunications and Information Administration.
       (25) Public safety answering point.--The term ``public 
     safety answering point'' has the meaning given such term in 
     section 222 of the Communications Act of 1934 (47 U.S.C. 
     222).
       (26) Public safety entity.--The term ``public safety 
     entity'' means an entity that provides public safety 
     services.
       (27) Public safety services.--The term ``public safety 
     services''--
       (A) has the meaning given the term in section 337(f) of the 
     Communications Act of 1934 (47 U.S.C. 337(f)); and
       (B) includes services provided by emergency response 
     providers, as that term is defined in section 2 of the 
     Homeland Security Act of 2002 (6 U.S.C. 101).
       (28) Public safety trust fund.--The term ``Public Safety 
     Trust Fund'' means the trust fund established under section 
     6413(a)(1).
       (29) Radio access network.--The term ``radio access 
     network'' means the radio access network described in section 
     6202(b)(2).
       (30) Reverse auction.--The term ``reverse auction'' means 
     the portion of an incentive auction of broadcast television 
     spectrum under section 6403(a), in which a broadcast 
     television licensee may submit bids stating the amount it 
     would accept for voluntarily relinquishing some or all of its 
     broadcast television spectrum usage rights.
       (31) State.--The term ``State'' has the meaning given such 
     term in section 3 of the Communications Act of 1934 (47 
     U.S.C. 153).
       (32) Ultra high frequency.--The term ``ultra high 
     frequency'' means, with respect to a television channel, that 
     the channel is located in the portion of the electromagnetic 
     spectrum between the frequencies from 470 megahertz to 698 
     megahertz.
       (33) Very high frequency.--The term ``very high frequency'' 
     means, with respect to a television channel, that the channel 
     is located in the portion of the electromagnetic spectrum 
     between the frequencies from 54 megahertz to 72 megahertz, 
     from 76 megahertz to 88 megahertz, or from 174 megahertz to 
     216 megahertz.

     SEC. 6002. RULE OF CONSTRUCTION.

       Each range of frequencies described in this title shall be 
     construed to be inclusive of the upper and lower frequencies 
     in the range.

     SEC. 6003. ENFORCEMENT.

       (a) In General.--The Commission shall implement and enforce 
     this title as if this title is a part of the Communications 
     Act of 1934 (47 U.S.C. 151 et seq.). A violation of this 
     title, or a regulation promulgated under this title, shall be 
     considered to be a violation of the Communications Act of 
     1934, or a regulation promulgated under such Act, 
     respectively.
       (b) Exceptions.--
       (1) Other agencies.--Subsection (a) does not apply in the 
     case of a provision of this title that is expressly required 
     to be carried out by an agency (as defined in section 551 of 
     title 5, United States Code) other than the Commission.
       (2) NTIA regulations.--The Assistant Secretary may 
     promulgate such regulations as are necessary to implement and 
     enforce any provision of this title that is expressly 
     required to be carried out by the Assistant Secretary.

     SEC. 6004. NATIONAL SECURITY RESTRICTIONS ON USE OF FUNDS AND 
                   AUCTION PARTICIPATION.

       (a) Use of Funds.--No funds made available by subtitle B or 
     C may be used to make payments under a contract to a person 
     described in subsection (c).
       (b) Auction Participation.--A person described in 
     subsection (c) may not participate in a system of competitive 
     bidding under section 309(j) of the Communications Act of 
     1934 (47 U.S.C. 309(j))--
       (1) that is required to be conducted by this title; or
       (2) in which any spectrum usage rights for which licenses 
     are being assigned were made available under clause (i) of 
     subparagraph

[[Page H848]]

     (G) of paragraph (8) of such section, as added by section 
     6402.
       (c) Person Described.--A person described in this 
     subsection is a person who has been, for reasons of national 
     security, barred by any agency of the Federal Government from 
     bidding on a contract, participating in an auction, or 
     receiving a grant.

           Subtitle A--Reallocation of Public Safety Spectrum

     SEC. 6101. REALLOCATION OF D BLOCK TO PUBLIC SAFETY.

       (a) In General.--The Commission shall reallocate the 700 
     MHz D block spectrum for use by public safety entities in 
     accordance with the provisions of this Act.
       (b) Spectrum Allocation.--Section 337(a) of the 
     Communications Act of 1934 (47 U.S.C. 337(a)) is amended--
       (1) by striking ``24'' in paragraph (1) and inserting 
     ``34''; and
       (2) by striking ``36'' in paragraph (2) and inserting 
     ``26''.

     SEC. 6102. FLEXIBLE USE OF NARROWBAND SPECTRUM.

       The Commission may allow the narrowband spectrum to be used 
     in a flexible manner, including usage for public safety 
     broadband communications, subject to such technical and 
     interference protection measures as the Commission may 
     require.

     SEC. 6103. 470 512 MHZ PUBLIC SAFETY SPECTRUM.

       (a) In General.--Not later than 9 years after the date of 
     enactment of this title, the Commission shall--
       (1) reallocate the spectrum in the 470 512 MHz band 
     (referred to in this section as the ``T-Band spectrum'') 
     currently used by public safety eligibles as identified in 
     section 90.303 of title 47, Code of Federal Regulations; and
       (2) begin a system of competitive bidding under section 
     309(j) of the Communications Act of 1934 (47 U.S.C. 309(j)) 
     to grant new initial licenses for the use of the spectrum 
     described in paragraph (1).
       (b) Auction Proceeds.--Proceeds (including deposits and 
     upfront payments from successful bidders) from the 
     competitive bidding system described in subsection (a)(2) 
     shall be available to the Assistant Secretary to make grants 
     in such sums as necessary to cover relocation costs for the 
     relocation of public safety entities from the T-Band 
     spectrum.
       (c) Relocation.--Relocation shall be completed not later 
     than 2 years after the date on which the system of 
     competitive bidding described in subsection (a)(2) is 
     completed.

            Subtitle B--Governance of Public Safety Spectrum

     SEC. 6201. SINGLE PUBLIC SAFETY WIRELESS NETWORK LICENSEE.

       (a) Reallocation and Grant of License.--Notwithstanding any 
     other provision of law, and subject to the provisions of this 
     Act, the Commission shall reallocate and grant a license to 
     the First Responder Network Authority for the use of the 700 
     MHz D block spectrum and existing public safety broadband 
     spectrum.
       (b) Term of License.--
       (1) Initial license.--The license granted under subsection 
     (a) shall be for an initial term of 10 years from the date of 
     the initial issuance of the license.
       (2) Renewal of license.--Prior to expiration of the term of 
     the initial license granted under subsection (a) or the 
     expiration of any subsequent renewal of such license, the 
     First Responder Network Authority shall submit to the 
     Commission an application for the renewal of such license. 
     Such renewal application shall demonstrate that, during the 
     preceding license term, the First Responder Network Authority 
     has met the duties and obligations set forth under this Act. 
     A renewal license granted under this paragraph shall be for a 
     term of not to exceed 10 years.
       (c) Facilitation of Transition.--The Commission shall take 
     all actions necessary to facilitate the transition of the 
     existing public safety broadband spectrum to the First 
     Responder Network Authority.

     SEC. 6202. PUBLIC SAFETY BROADBAND NETWORK.

       (a) Establishment.--The First Responder Network Authority 
     shall ensure the establishment of a nationwide, interoperable 
     public safety broadband network.
       (b) Network Components.--The nationwide public safety 
     broadband network shall be based on a single, national 
     network architecture that evolves with technological 
     advancements and initially consists of--
       (1) a core network that--
       (A) consists of national and regional data centers, and 
     other elements and functions that may be distributed 
     geographically, all of which shall be based on commercial 
     standards; and
       (B) provides the connectivity between--
       (i) the radio access network; and
       (ii) the public Internet or the public switched network, or 
     both; and
       (2) a radio access network that--
       (A) consists of all cell site equipment, antennas, and 
     backhaul equipment, based on commercial standards, that are 
     required to enable wireless communications with devices using 
     the public safety broadband spectrum; and
       (B) shall be developed, constructed, managed, maintained, 
     and operated taking into account the plans developed in the 
     State, local, and tribal planning and implementation grant 
     program under section 6302(a).

     SEC. 6203. PUBLIC SAFETY INTEROPERABILITY BOARD.

       (a) Establishment.--There is established within the 
     Commission an advisory board to be known as the ``Technical 
     Advisory Board for First Responder Interoperability''.
       (b) Membership.--
       (1) In general.--
       (A) Voting members.--Not later than 30 days after the date 
     of enactment of this title, the Chairman of the Commission 
     shall appoint 14 voting members to the Interoperability 
     Board, of which--
       (i) 4 members shall be representatives of wireless 
     providers, of which--

       (I) 2 members shall be representatives of national wireless 
     providers;
       (II) 1 member shall be a representative of regional 
     wireless providers; and
       (III) 1 member shall be a representative of rural wireless 
     providers;

       (ii) 3 members shall be representatives of equipment 
     manufacturers;
       (iii) 4 members shall be representatives of public safety 
     entities, of which--

       (I) not less than 1 member shall be a representative of 
     management level employees of public safety entities; and
       (II) not less than 1 member shall be a representative of 
     employees of public safety entities;

       (iv) 3 members shall be representatives of State and local 
     governments, chosen to reflect geographic and population 
     density differences across the United States; and
       (v) all members shall have specific expertise necessary to 
     developing technical requirements under this section, such as 
     technical expertise, public safety communications expertise, 
     and commercial network experience.
       (B) Non-voting member.--The Assistant Secretary shall 
     appoint 1 non-voting member to the Interoperability Board.
       (2) Period of appointment.--
       (A) In general.--Except as provided in subparagraph (B), 
     members of the Interoperability Board shall be appointed for 
     the life of the Interoperability Board.
       (B) Removal for cause.--A member of the Interoperability 
     Board may be removed for cause upon the determination of the 
     Chairman of the Commission.
       (3) Vacancies.--Any vacancy in the Interoperability Board 
     shall not affect the powers of the Interoperability Board, 
     and shall be filled in the same manner as the original 
     appointment.
       (4) Chairperson and vice chairperson.--The Interoperability 
     Board shall select a Chairperson and Vice Chairperson from 
     among the members of the Interoperability Board.
       (5) Quorum.--A majority of the members of the 
     Interoperability Board shall constitute a quorum.
       (c) Duties of the Interoperability Board.--
       (1) Development of technical requirements.--Not later than 
     90 days after the date of enactment of this Act, the 
     Interoperability Board, in consultation with the NTIA, NIST, 
     and the Office of Emergency Communications of the Department 
     of Homeland Security, shall--
       (A) develop recommended minimum technical requirements to 
     ensure a nationwide level of interoperability for the 
     nationwide public safety broadband network; and
       (B) submit to the Commission for review in accordance with 
     paragraph (3) recommended minimum technical requirements 
     described in subparagraph (A).
       (2) Consideration.--In developing recommended minimum 
     technical requirements under paragraph (1), the 
     Interoperability Board shall base the recommended minimum 
     technical requirements on the commercial standards for Long 
     Term Evolution (LTE) service.
       (3) Approval of recommendations.--
       (A) In general.--Not later than 30 days after the date on 
     which the Interoperability Board submits recommended minimum 
     technical requirements under paragraph (1)(B), the Commission 
     shall approve the recommendations, with any revisions it 
     deems necessary, and transmit such recommendations to the 
     First Responder Network Authority.
       (B) Review.--Any actions taken under subparagraph (A) shall 
     not be reviewable as a final agency action.
       (d) Travel Expenses.--The members of the Interoperability 
     Board shall be allowed travel expenses, including per diem in 
     lieu of subsistence, at rates authorized for employees of 
     agencies under subchapter I of chapter 57 of title 5, United 
     States Code, while away from their homes or regular places of 
     business in the performance of services for the 
     Interoperability Board.
       (e) Exemption From FACA.--The Federal Advisory Committee 
     Act (5 U.S.C. App.) shall not apply to the Interoperability 
     Board.
       (f) Termination of Authority.--The Interoperability Board 
     shall terminate 15 days after the date on which the 
     Commission transmits the recommendations to the First 
     Responder Network Authority under subsection (c)(3)(A).

     SEC. 6204. ESTABLISHMENT OF THE FIRST RESPONDER NETWORK 
                   AUTHORITY.

       (a) Establishment.--There is established as an independent 
     authority within the NTIA the ``First Responder Network 
     Authority'' or ``FirstNet''.
       (b) Board.--
       (1) In general.--The First Responder Network Authority 
     shall be headed by a Board, which shall consist of--
       (A) the Secretary of Homeland Security;
       (B) the Attorney General of the United States;

[[Page H849]]

       (C) the Director of the Office of Management and Budget; 
     and
       (D) 12 individuals appointed by the Secretary of Commerce 
     in accordance with paragraph (2).
       (2) Appointments.--
       (A) In general.--In making appointments under paragraph 
     (1)(D), the Secretary of Commerce shall--
       (i) appoint not fewer than 3 individuals to represent the 
     collective interests of the States, localities, tribes, and 
     territories;
       (ii) seek to ensure geographic and regional representation 
     of the United States in such appointments;
       (iii) seek to ensure rural and urban representation in such 
     appointments; and
       (iv) appoint not fewer than 3 individuals who have served 
     as public safety professionals.
       (B) Required qualifications.--
       (i) In general.--Each member appointed under paragraph 
     (1)(D) should meet not less than 1 of the following criteria:

       (I) Public safety experience.--Knowledge and experience in 
     the use of Federal, State, local, or tribal public safety or 
     emergency response.
       (II) Technical expertise.--Technical expertise and fluency 
     regarding broadband communications, including public safety 
     communications.
       (III) Network expertise.--Expertise in building, deploying, 
     and operating commercial telecommunications networks.
       (IV) Financial expertise.--Expertise in financing and 
     funding telecommunications networks.

       (ii) Expertise to be represented.--In making appointments 
     under paragraph (1)(D), the Secretary of Commerce shall 
     appoint--

       (I) not fewer than 1 individual who satisfies the 
     requirement under subclause (II) of clause (i);
       (II) not fewer than 1 individual who satisfies the 
     requirement under subclause (III) of clause (i); and
       (III) not fewer than 1 individual who satisfies the 
     requirement under subclause (IV) of clause (i).

       (C) Citizenship.--No individual other than a citizen of the 
     United States may serve as a member of the Board.
       (c) Terms of Appointment.--
       (1) Initial appointment deadline.--Members of the Board 
     shall be appointed not later than 180 days after the date of 
     the enactment of this title.
       (2) Terms.--
       (A) Length.--
       (i) In general.--Each member of the Board described in 
     subparagraphs (A) through (C) of subsection (b)(1) shall 
     serve as a member of the Board for the life of the First 
     Responder Network Authority.
       (ii) Appointed individuals.--The term of office of each 
     individual appointed to be a member of the Board under 
     subsection (b)(1)(D) shall be 3 years. No member described in 
     this clause may serve more than 2 consecutive full 3-year 
     terms.
       (B) Expiration of term.--Any member whose term has expired 
     may serve until such member's successor has taken office, or 
     until the end of the calendar year in which such member's 
     term has expired, whichever is earlier.
       (C) Appointment to fill vacancy.--Any member appointed to 
     fill a vacancy occurring prior to the expiration of the term 
     for which that member's predecessor was appointed shall be 
     appointed for the remainder of the predecessor's term.
       (D) Staggered terms.--With respect to the initial members 
     of the Board appointed under subsection (b)(1)(D)--
       (i) 4 members shall serve for a term of 3 years;
       (ii) 4 members shall serve for a term of 2 years; and
       (iii) 4 members shall serve for a term of 1 year.
       (3) Vacancies.--A vacancy in the membership of the Board 
     shall not affect the Board's powers, and shall be filled in 
     the same manner as the original member was appointed.
       (d) Chair.--
       (1) Selection.--The Secretary of Commerce shall select, 
     from among the members of the Board appointed under 
     subsection (b)(1)(D), an individual to serve for a 2-year 
     term as Chair of the Board.
       (2) Consecutive terms.--An individual may not serve for 
     more than 2 consecutive terms as Chair of the Board.
       (e) Meetings.--
       (1) Frequency.--The Board shall meet--
       (A) at the call of the Chair ; and
       (B) not less frequently than once each quarter.
       (2) Transparency.--Meetings of the Board, including any 
     committee of the Board, shall be open to the public. The 
     Board may, by majority vote, close any such meeting only for 
     the time necessary to preserve the confidentiality of 
     commercial or financial information that is privileged or 
     confidential, to discuss personnel matters, or to discuss 
     legal matters affecting the First Responder Network 
     Authority, including pending or potential litigation.
       (f) Quorum.--Eight members of the Board shall constitute a 
     quorum, including at least 6 of the members appointed under 
     subsection (b)(1)(D).
       (g) Compensation.--
       (1) In general.--The members of the Board appointed under 
     subsection (b)(1)(D) shall be compensated at the daily rate 
     of basic pay for level IV of the Executive Schedule for each 
     day during which such members are engaged in performing a 
     function of the Board.
       (2) Prohibition on compensation.--A member of the Board 
     appointed under subparagraphs (A) through (C) of subsection 
     (b)(1) shall serve without additional pay, and shall not 
     otherwise benefit, directly or indirectly, as a result of 
     their service to the First Responder Network Authority, but 
     shall be allowed a per diem allowance for travel expenses, at 
     rates authorized for an employee of an agency under 
     subchapter I of chapter 57 of title 5, United States Code, 
     while away from the home or regular place of business of the 
     member in the performance of the duties of the First 
     Responder Network Authority.

     SEC. 6205. ADVISORY COMMITTEES OF THE FIRST RESPONDER NETWORK 
                   AUTHORITY.

       (a) Advisory Committees.--The First Responder Network 
     Authority--
       (1) shall establish a standing public safety advisory 
     committee to assist the First Responder Network Authority in 
     carrying out its duties and responsibilities under this 
     subtitle; and
       (2) may establish additional standing or ad hoc committees, 
     panels, or councils as the First Responder Network Authority 
     determines are necessary.
       (b) Selection of Agents, Consultants, and Experts.--
       (1) In general.--The First Responder Network Authority 
     shall select parties to serve as its agents, consultants, or 
     experts in a fair, transparent, and objective manner, and 
     such agents may include a program manager to carry out 
     certain of the duties and responsibilities of deploying and 
     operating the nationwide public safety broadband network 
     described in subsections (b) and (c) of section 6206.
       (2) Binding and final.--If the selection of an agent, 
     consultant, or expert satisfies the requirements under 
     paragraph (1), the selection of that agent, consultant, or 
     expert shall be final and binding.

     SEC. 6206. POWERS, DUTIES, AND RESPONSIBILITIES OF THE FIRST 
                   RESPONDER NETWORK AUTHORITY.

       (a) General Powers.--The First Responder Network Authority 
     shall have the authority to do the following:
       (1) To exercise, through the actions of its Board, all 
     powers specifically granted by the provisions of this 
     subtitle, and such incidental powers as shall be necessary.
       (2) To hold such hearings, sit and act at such times and 
     places, take such testimony, and receive such evidence as the 
     First Responder Network Authority considers necessary to 
     carry out its responsibilities and duties.
       (3) To obtain grants and funds from and make contracts with 
     individuals, private companies, organizations, institutions, 
     and Federal, State, regional, and local agencies.
       (4) To accept, hold, administer, and utilize gifts, 
     donations, and bequests of property, both real and personal, 
     for the purposes of aiding or facilitating the work of the 
     First Responder Network Authority.
       (5) To spend funds under paragraph (3) in a manner 
     authorized by the Board, but only for purposes that will 
     advance or enhance public safety communications consistent 
     with this title.
       (6) To take such other actions as the First Responder 
     Network Authority (through the Board) may from time to time 
     determine necessary, appropriate, or advisable to accomplish 
     the purposes of this title.
       (b) Duty and Responsibility to Deploy and Operate a 
     Nationwide Public Safety Broadband Network.--
       (1) In general.--The First Responder Network Authority 
     shall hold the single public safety wireless license granted 
     under section 6201 and take all actions necessary to ensure 
     the building, deployment, and operation of the nationwide 
     public safety broadband network, in consultation with 
     Federal, State, tribal, and local public safety entities, the 
     Director of NIST, the Commission, and the public safety 
     advisory committee established in section 6205(a), including 
     by, at a minimum--
       (A) ensuring nationwide standards for use and access of the 
     network;
       (B) issuing open, transparent, and competitive requests for 
     proposals to private sector entities for the purposes of 
     building, operating, and maintaining the network that use, 
     without materially changing, the minimum technical 
     requirements developed under section 6203;
       (C) encouraging that such requests leverage, to the maximum 
     extent economically desirable, existing commercial wireless 
     infrastructure to speed deployment of the network; and
       (D) managing and overseeing the implementation and 
     execution of contracts or agreements with non-Federal 
     entities to build, operate, and maintain the network.
       (2) Requirements.--In carrying out the duties and 
     responsibilities of this subsection, including issuing 
     requests for proposals, the First Responder Network Authority 
     shall--
       (A) ensure the safety, security, and resiliency of the 
     network, including requirements for protecting and monitoring 
     the network to protect against cyberattack;
       (B) promote competition in the equipment market, including 
     devices for public safety communications, by requiring that 
     equipment for use on the network be--
       (i) built to open, non-proprietary, commercially available 
     standards;
       (ii) capable of being used by any public safety entity and 
     by multiple vendors across all public safety broadband 
     networks operating in the 700 MHz band; and

[[Page H850]]

       (iii) backward-compatible with existing commercial networks 
     to the extent that such capabilities are necessary and 
     technically and economically reasonable;
       (C) promote integration of the network with public safety 
     answering points or their equivalent; and
       (D) address special considerations for areas or regions 
     with unique homeland security or national security needs.
       (3) Rural coverage.--In carrying out the duties and 
     responsibilities of this subsection, including issuing 
     requests for proposals, the nationwide, interoperable public 
     safety broadband network, consistent with the license granted 
     under section 6201, shall require deployment phases with 
     substantial rural coverage milestones as part of each phase 
     of the construction and deployment of the network. To the 
     maximum extent economically desirable, such proposals shall 
     include partnerships with existing commercial mobile 
     providers to utilize cost-effective opportunities to speed 
     deployment in rural areas.
       (4) Execution of authority.--In carrying out the duties and 
     responsibilities of this subsection, the First Responder 
     Network Authority may--
       (A) obtain grants from and make contracts with individuals, 
     private companies, and Federal, State, regional, and local 
     agencies;
       (B) hire or accept voluntary services of consultants, 
     experts, advisory boards, and panels to aid the First 
     Responder Network Authority in carrying out such duties and 
     responsibilities;
       (C) receive payment for use of--
       (i) network capacity licensed to the First Responder 
     Network Authority; and
       (ii) network infrastructure constructed, owned, or operated 
     by the First Responder Network Authority; and
       (D) take such other actions as may be necessary to 
     accomplish the purposes set forth in this subsection.
       (c) Other Specific Duties and Responsibilities.--
       (1) Establishment of network policies.--In carrying out the 
     requirements under subsection (b), the First Responder 
     Network Authority shall develop--
       (A) requests for proposals with appropriate--
       (i) timetables for construction, including by taking into 
     consideration the time needed to build out to rural areas and 
     the advantages offered through partnerships with existing 
     commercial providers under paragraph (3);
       (ii) coverage areas, including coverage in rural and 
     nonurban areas;
       (iii) service levels;
       (iv) performance criteria; and
       (v) other similar matters for the construction and 
     deployment of such network;
       (B) the technical and operational requirements of the 
     network;
       (C) practices, procedures, and standards for the management 
     and operation of such network;
       (D) terms of service for the use of such network, including 
     billing practices; and
       (E) ongoing compliance review and monitoring of the--
       (i) management and operation of such network;
       (ii) practices and procedures of the entities operating on 
     and the personnel using such network; and
       (iii) necessary training needs of network operators and 
     users.
       (2) State and local planning.--
       (A) Required consultation.--In developing requests for 
     proposals and otherwise carrying out its responsibilities 
     under this Act, the First Responder Network Authority shall 
     consult with regional, State, tribal, and local jurisdictions 
     regarding the distribution and expenditure of any amounts 
     required to carry out the policies established under 
     paragraph (1), including with regard to the--
       (i) construction of a core network and any radio access 
     network build out;
       (ii) placement of towers;
       (iii) coverage areas of the network, whether at the 
     regional, State, tribal, or local level;
       (iv) adequacy of hardening, security, reliability, and 
     resiliency requirements;
       (v) assignment of priority to local users;
       (vi) assignment of priority and selection of entities 
     seeking access to or use of the nationwide public safety 
     interoperable broadband network established under subsection 
     (b); and
       (vii) training needs of local users.
       (B) Method of consultation.--The consultation required 
     under subparagraph (A) shall occur between the First 
     Responder Network Authority and the single officer or 
     governmental body designated under section 6302(d).
       (3) Leveraging existing infrastructure.--In carrying out 
     the requirement under subsection (b), the First Responder 
     Network Authority shall enter into agreements to utilize, to 
     the maximum extent economically desirable, existing--
       (A) commercial or other communications infrastructure; and
       (B) Federal, State, tribal, or local infrastructure.
       (4) Maintenance and upgrades.--The First Responder Network 
     Authority shall ensure the maintenance, operation, and 
     improvement of the nationwide public safety broadband 
     network, including by ensuring that the First Responder 
     Network Authority updates and revises any policies 
     established under paragraph (1) to take into account new and 
     evolving technologies.
       (5) Roaming agreements.--The First Responder Network 
     Authority shall negotiate and enter into, as it determines 
     appropriate, roaming agreements with commercial network 
     providers to allow the nationwide public safety broadband 
     network to roam onto commercial networks and gain 
     prioritization of public safety communications over such 
     networks in times of an emergency.
       (6) Network infrastructure and device criteria.--The 
     Director of NIST, in consultation with the First Responder 
     Network Authority and the Commission, shall ensure the 
     development of a list of certified devices and components 
     meeting appropriate protocols and standards for public safety 
     entities and commercial vendors to adhere to, if such 
     entities or vendors seek to have access to, use of, or 
     compatibility with the nationwide public safety broadband 
     network.
       (7) Representation before standard setting entities.--The 
     First Responder Network Authority, in consultation with the 
     Director of NIST, the Commission, and the public safety 
     advisory committee established under section 6205(a), shall 
     represent the interests of public safety users of the 
     nationwide public safety broadband network before any 
     proceeding, negotiation, or other matter in which a standards 
     organization, standards body, standards development 
     organization, or any other recognized standards-setting 
     entity addresses the development of standards relating to 
     interoperability.
       (8) Prohibition on negotiation with foreign governments.--
     The First Responder Network Authority shall not have the 
     authority to negotiate or enter into any agreements with a 
     foreign government on behalf of the United States.
       (d) Exemption From Certain Laws.--Any action taken or 
     decisions made by the First Responder Network Authority shall 
     be exempt from the requirements of--
       (1) section 3506 of title 44, United States Code (commonly 
     referred to as the Paperwork Reduction Act);
       (2) chapter 5 of title 5, United States Code (commonly 
     referred to as the Administrative Procedures Act); and
       (3) chapter 6 of title 5, United States Code (commonly 
     referred to as the Regulatory Flexibility Act).
       (e) Network Construction Fund.--
       (1) Establishment.--There is established in the Treasury of 
     the United States a fund to be known as the ``Network 
     Construction Fund''.
       (2) Use of fund.--Amounts deposited into the Network 
     Construction Fund shall be used by the--
       (A) First Responder Network Authority to carry out this 
     section, except for administrative expenses; and
       (B) NTIA to make grants to States under section 
     6302(e)(3)(C)(iii)(I).
       (f) Termination of Authority.--The authority of the First 
     Responder Network Authority shall terminate on the date that 
     is 15 years after the date of enactment of this title.
       (g) GAO Report.--Not later than 10 years after the date of 
     the enactment of this Act, the Comptroller General of the 
     United States shall submit to Congress a report on what 
     action Congress should take regarding the 15-year sunset of 
     authority under subsection (f).

     SEC. 6207. INITIAL FUNDING FOR THE FIRST RESPONDER NETWORK 
                   AUTHORITY.

       (a) Borrowing Authority.--Prior to the deposit of proceeds 
     into the Public Safety Trust Fund from the incentive auctions 
     to be carried out under section 309(j)(8)(G) of the 
     Communications Act of 1934 or the auction of spectrum 
     pursuant to section 6401, the NTIA may borrow from the 
     Treasury such sums as may be necessary, but not to exceed 
     $2,000,000,000, to implement this subtitle. The NTIA shall 
     reimburse the Treasury, without interest, from funds 
     deposited into the Public Safety Trust Fund.
       (b) Prohibition.--
       (1) In general.--Administrative expenses of the First 
     Responder Network Authority may not exceed $100,000,000 
     during the 10-year period beginning on the date of enactment 
     of this title.
       (2) Definition.--For purposes of this subsection, the term 
     ``administrative expenses'' does not include the costs 
     incurred by the First Responder Network Authority for 
     oversight and audits to protect against waste, fraud, and 
     abuse.

     SEC. 6208. PERMANENT SELF-FUNDING; DUTY TO ASSESS AND COLLECT 
                   FEES FOR NETWORK USE.

       (a) In General.--Notwithstanding section 337 of the 
     Communications Act of 1934 (47 U.S.C. 337), the First 
     Responder Network Authority is authorized to assess and 
     collect the following fees:
       (1) Network user fee.--A user or subscription fee from each 
     entity, including any public safety entity or secondary user, 
     that seeks access to or use of the nationwide public safety 
     broadband network.
       (2) Lease fees related to network capacity.--
       (A) In general.--A fee from any entity that seeks to enter 
     into a covered leasing agreement.
       (B) Covered leasing agreement.--For purposes of 
     subparagraph (A), a ``covered leasing agreement'' means a 
     written agreement resulting from a public-private arrangement 
     to construct, manage, and operate the nationwide public 
     safety broadband network between the First Responder Network 
     Authority and secondary user to permit--

[[Page H851]]

       (i) access to network capacity on a secondary basis for 
     non-public safety services; and
       (ii) the spectrum allocated to such entity to be used for 
     commercial transmissions along the dark fiber of the long-
     haul network of such entity.
       (3) Lease fees related to network equipment and 
     infrastructure.--A fee from any entity that seeks access to 
     or use of any equipment or infrastructure, including antennas 
     or towers, constructed or otherwise owned by the First 
     Responder Network Authority resulting from a public-private 
     arrangement to construct, manage, and operate the nationwide 
     public safety broadband network.
       (b) Establishment of Fee Amounts; Permanent Self-funding.--
     The total amount of the fees assessed for each fiscal year 
     pursuant to this section shall be sufficient, and shall not 
     exceed the amount necessary, to recoup the total expenses of 
     the First Responder Network Authority in carrying out its 
     duties and responsibilities described under this subtitle for 
     the fiscal year involved.
       (c) Annual Approval.--The NTIA shall review the fees 
     assessed under this section on an annual basis, and such fees 
     may only be assessed if approved by the NTIA.
       (d) Required Reinvestment of Funds.--The First Responder 
     Network Authority shall reinvest amounts received from the 
     assessment of fees under this section in the nationwide 
     public safety interoperable broadband network by using such 
     funds only for constructing, maintaining, operating, or 
     improving the network.

     SEC. 6209. AUDIT AND REPORT.

       (a) Audit.--
       (1) In general.--The Secretary of Commerce shall enter into 
     a contract with an independent auditor to conduct an audit, 
     on an annual basis, of the First Responder Network Authority 
     in accordance with general accounting principles and 
     procedures applicable to commercial corporate transactions. 
     Each audit conducted under this paragraph shall be made 
     available to the appropriate committees of Congress.
       (2) Location.--Any audit conducted under paragraph (1) 
     shall be conducted at the place or places where accounts of 
     the First Responder Network Authority are normally kept.
       (3) Access to first responder network authority books and 
     documents.--
       (A) In general.--For purposes of an audit conducted under 
     paragraph (1), the representatives of the independent auditor 
     shall--
       (i) have access to all books, accounts, records, reports, 
     files, and all other papers, things, or property belonging to 
     or in use by the First Responder Network Authority that 
     pertain to the financial transactions of the First Responder 
     Network Authority and are necessary to facilitate the audit; 
     and
       (ii) be afforded full facilities for verifying transactions 
     with the balances or securities held by depositories, fiscal 
     agents, and custodians.
       (B) Requirement.--All books, accounts, records, reports, 
     files, papers, and property of the First Responder Network 
     Authority shall remain in the possession and custody of the 
     First Responder Network Authority.
       (b) Report.--
       (1) In general.--The independent auditor selected to 
     conduct an audit under this section shall submit a report of 
     each audit conducted under subsection (a) to--
       (A) the appropriate committees of Congress;
       (B) the President; and
       (C) the First Responder Network Authority.
       (2) Contents.--Each report submitted under paragraph (1) 
     shall contain--
       (A) such comments and information as the independent 
     auditor determines necessary to inform Congress of the 
     financial operations and condition of the First Responder 
     Network Authority;
       (B) any recommendations of the independent auditor relating 
     to the financial operations and condition of the First 
     Responder Network Authority; and
       (C) a description of any program, expenditure, or other 
     financial transaction or undertaking of the First Responder 
     Network Authority that was observed during the course of the 
     audit, which, in the opinion of the independent auditor, has 
     been carried on or made without the authority of law.

     SEC. 6210. ANNUAL REPORT TO CONGRESS.

       (a) In General.--Not later than 1 year after the date of 
     enactment of this Act, and each year thereafter, the First 
     Responder Network Authority shall submit an annual report 
     covering the preceding fiscal year to the appropriate 
     committees of Congress.
       (b) Required Content.--The report required under subsection 
     (a) shall include--
       (1) a comprehensive and detailed report of the operations, 
     activities, financial condition, and accomplishments of the 
     First Responder Network Authority under this section; and
       (2) such recommendations or proposals for legislative or 
     administrative action as the First Responder Network 
     Authority deems appropriate.
       (c) Availability to Testify.--The members of the Board and 
     employees of the First Responder Network Authority shall be 
     available to testify before the appropriate committees of the 
     Congress with respect to--
       (1) the report required under subsection (a);
       (2) the report of any audit conducted under section 6210; 
     or
       (3) any other matter which such committees may determine 
     appropriate.

     SEC. 6211. PUBLIC SAFETY ROAMING AND PRIORITY ACCESS.

       The Commission may adopt rules, if necessary in the public 
     interest, to improve the ability of public safety networks to 
     roam onto commercial networks and to gain priority access to 
     commercial networks in an emergency if--
       (1) the public safety entity equipment is technically 
     compatible with the commercial network;
       (2) the commercial network is reasonably compensated; and
       (3) such access does not preempt or otherwise terminate or 
     degrade all existing voice conversations or data sessions.

     SEC. 6212. PROHIBITION ON DIRECT OFFERING OF COMMERCIAL 
                   TELECOMMUNICATIONS SERVICE DIRECTLY TO 
                   CONSUMERS.

       (a) In General.--The First Responder Network Authority 
     shall not offer, provide, or market commercial 
     telecommunications or information services directly to 
     consumers.
       (b) Rule of Construction.--Nothing in this section shall be 
     construed to prohibit the First Responder Network Authority 
     and a secondary user from entering into a covered leasing 
     agreement pursuant to section 6208(a)(2)(B). Nothing in this 
     section shall be construed to limit the First Responder 
     Network Authority from collecting lease fees related to 
     network equipment and infrastructure pursuant to section 
     6208(a)(3).

     SEC. 6213. PROVISION OF TECHNICAL ASSISTANCE.

       The Commission may provide technical assistance to the 
     First Responder Network Authority and may take any action 
     necessary to assist the First Responder Network Authority in 
     effectuating its duties and responsibilities under this 
     subtitle.

                 Subtitle C--Public Safety Commitments

     SEC. 6301. STATE AND LOCAL IMPLEMENTATION FUND.

       (a) Establishment.--There is established in the Treasury of 
     the United States a fund to be known as the State and Local 
     Implementation Fund.
       (b) Amounts Available for State and Local Implementation 
     Grant Program.--Any amounts borrowed under subsection (c)(1) 
     and any amounts in the State and Local Implementation Fund 
     that are not necessary to reimburse the general fund of the 
     Treasury for such borrowed amounts shall be available to the 
     Assistant Secretary to implement section 6302.
       (c) Borrowing Authority.--
       (1) In general.--Prior to the end of fiscal year 2022, the 
     Assistant Secretary may borrow from the general fund of the 
     Treasury such sums as may be necessary, but not to exceed 
     $135,000,000, to implement section 6302.
       (2) Reimbursement.--The Assistant Secretary shall reimburse 
     the general fund of the Treasury, without interest, for any 
     amounts borrowed under paragraph (1) as funds are deposited 
     into the State and Local Implementation Fund.
       (d) Transfer of Unused Funds.--If there is a balance 
     remaining in the State and Local Implementation Fund on 
     September 30, 2022, the Secretary of the Treasury shall 
     transfer such balance to the general fund of the Treasury, 
     where such balance shall be dedicated for the sole purpose of 
     deficit reduction.

     SEC. 6302. STATE AND LOCAL IMPLEMENTATION.

       (a) Establishment of State and Local Implementation Grant 
     Program.--The Assistant Secretary, in consultation with the 
     First Responder Network Authority, shall take such action as 
     is necessary to establish a grant program to make grants to 
     States to assist State, regional, tribal, and local 
     jurisdictions to identify, plan, and implement the most 
     efficient and effective way for such jurisdictions to utilize 
     and integrate the infrastructure, equipment, and other 
     architecture associated with the nationwide public safety 
     broadband network to satisfy the wireless communications and 
     data services needs of that jurisdiction, including with 
     regards to coverage, siting, and other needs.
       (b) Matching Requirements; Federal Share.--
       (1) In general.--The Federal share of the cost of any 
     activity carried out using a grant under this section may not 
     exceed 80 percent of the eligible costs of carrying out that 
     activity, as determined by the Assistant Secretary, in 
     consultation with the First Responder Network Authority.
       (2) Waiver.--The Assistant Secretary may waive, in whole or 
     in part, the requirements of paragraph (1) for good cause 
     shown if the Assistant Secretary determines that such a 
     waiver is in the public interest.
       (c) Programmatic Requirements.--Not later than 6 months 
     after the date of enactment of this Act, the Assistant 
     Secretary, in consultation with the First Responder Network 
     Authority, shall establish requirements relating to the grant 
     program to be carried out under this section, including the 
     following:
       (1) Defining eligible costs for purposes of subsection 
     (b)(1).
       (2) Determining the scope of eligible activities for grant 
     funding under this section.
       (3) Prioritizing grants for activities that ensure coverage 
     in rural as well as urban areas.
       (d) Certification and Designation of Officer or 
     Governmental Body.--In carrying

[[Page H852]]

     out the grant program established under this section, the 
     Assistant Secretary shall require each State to certify in 
     its application for grant funds that the State has designated 
     a single officer or governmental body to serve as the 
     coordinator of implementation of the grant funds.
       (e) State Network.--
       (1) Notice.--Upon the completion of the request for 
     proposal process conducted by the First Responder Network 
     Authority for the construction, operation, maintenance, and 
     improvement of the nationwide public safety broadband 
     network, the First Responder Network Authority shall provide 
     to the Governor of each State, or his designee--
       (A) notice of the completion of the request for proposal 
     process;
       (B) details of the proposed plan for buildout of the 
     nationwide, interoperable broadband network in such State; 
     and
       (C) the funding level for the State as determined by the 
     NTIA.
       (2) State decision.--Not later than 90 days after the date 
     on which the Governor of a State receives notice under 
     paragraph (1), the Governor shall choose whether to--
       (A) participate in the deployment of the nationwide, 
     interoperable broadband network as proposed by the First 
     Responder Network Authority; or
       (B) conduct its own deployment of a radio access network in 
     such State.
       (3) Process.--
       (A) In general.--Upon making a decision to opt-out under 
     paragraph (2)(B), the Governor shall notify the First 
     Responder Network Authority, the NTIA, and the Commission of 
     such decision.
       (B) State request for proposals.--Not later than 180 days 
     after the date on which a Governor provides notice under 
     subparagraph (A), the Governor shall develop and complete 
     requests for proposals for the construction, maintenance, and 
     operation of the radio access network within the State.
       (C) Submission and approval of alternative plan.--
       (i) In general.--The State shall submit an alternative plan 
     for the construction, maintenance, operation, and 
     improvements of the radio access network within the State to 
     the Commission, and such plan shall demonstrate--

       (I) that the State will be in compliance with the minimum 
     technical interoperability requirements developed under 
     section 6203; and
       (II) interoperability with the nationwide public safety 
     broadband network.

       (ii) Commission approval or disapproval.--Upon submission 
     of a State plan under clause (i), the Commission shall either 
     approve or disapprove the plan.
       (iii) Approval.--If the Commission approves a plan under 
     this subparagraph, the State--

       (I) may apply to the NTIA for a grant to construct the 
     radio access network within the State that includes the 
     showing described in subparagraph (D); and
       (II) shall apply to the NTIA to lease spectrum capacity 
     from the First Responder Network Authority.

       (iv) Disapproval.--If the Commission disapproves a plan 
     under this subparagraph, the construction, maintenance, 
     operation, and improvements of the network within the State 
     shall proceed in accordance with the plan proposed by the 
     First Responder Network Authority.
       (D) Funding requirements.--In order to obtain grant funds 
     and spectrum capacity leasing rights under subparagraph 
     (C)(iii), a State shall demonstrate--
       (i) that the State has--

       (I) the technical capabilities to operate, and the funding 
     to support, the State radio access network;
       (II) has the ability to maintain ongoing interoperability 
     with the nationwide public safety broadband network; and
       (III) the ability to complete the project within specified 
     comparable timelines specific to the State;

       (ii) the cost-effectiveness of the State plan submitted 
     under subparagraph (C)(i); and
       (iii) comparable security, coverage, and quality of service 
     to that of the nationwide public safety broadband network.
       (f) User Fees.--If a State chooses to build its own radio 
     access network, the State shall pay any user fees associated 
     with State use of elements of the core network.
       (g) Prohibition.--
       (1) In general.--A State that chooses to build its own 
     radio access network shall not provide commercial service to 
     consumers or offer wholesale leasing capacity of the network 
     within the State except directly through public-private 
     partnerships for construction, maintenance, operation, and 
     improvement of the network within the State.
       (2) Rule of construction.--Nothing in this subsection shall 
     be construed to prohibit the State and a secondary user from 
     entering into a covered leasing agreement. Any revenue gained 
     by the State from such a leasing agreement shall be used only 
     for constructing, maintaining, operating, or improving the 
     radio access network of the State.
       (h) Judicial Review.--
       (1) In general.--The United States District Court for the 
     District of Columbia shall have exclusive jurisdiction to 
     review a decision of the Commission made under subsection 
     (e)(3)(C)(iv).
       (2) Standard of review.--The court shall affirm the 
     decision of the Commission unless--
       (A) the decision was procured by corruption, fraud, or 
     undue means;
       (B) there was actual partiality or corruption in the 
     Commission; or
       (C) the Commission was guilty of misconduct in refusing to 
     hear evidence pertinent and material to the decision or of 
     any other misbehavior by which the rights of any party have 
     been prejudiced.

     SEC. 6303. PUBLIC SAFETY WIRELESS COMMUNICATIONS RESEARCH AND 
                   DEVELOPMENT.

       (a) NIST Directed Research and Development Program.--From 
     amounts made available from the Public Safety Trust Fund, the 
     Director of NIST, in consultation with the Commission, the 
     Secretary of Homeland Security, and the National Institute of 
     Justice of the Department of Justice, as appropriate, shall 
     conduct research and assist with the development of 
     standards, technologies, and applications to advance wireless 
     public safety communications.
       (b) Required Activities.--In carrying out the requirement 
     under subsection (a), the Director of NIST, in consultation 
     with the First Responder Network Authority and the public 
     safety advisory committee established under section 6205(a), 
     shall--
       (1) document public safety wireless communications 
     technical requirements;
       (2) accelerate the development of the capability for 
     communications between currently deployed public safety 
     narrowband systems and the nationwide public safety broadband 
     network;
       (3) establish a research plan, and direct research, that 
     addresses the wireless communications needs of public safety 
     entities beyond what can be provided by the current 
     generation of broadband technology;
       (4) accelerate the development of mission critical voice, 
     including device-to-device ``talkaround'' capability over 
     broadband networks, public safety prioritization, 
     authentication capabilities, and standard application 
     programing interfaces for the nationwide public safety 
     broadband network, if necessary and practical;
       (5) accelerate the development of communications technology 
     and equipment that can facilitate the eventual migration of 
     public safety narrowband communications to the nationwide 
     public safety broadband network; and
       (6) convene working groups of relevant government and 
     commercial parties to achieve the requirements in paragraphs 
     (1) through (5).

                 Subtitle D--Spectrum Auction Authority

     SEC. 6401. DEADLINES FOR AUCTION OF CERTAIN SPECTRUM.

       (a) Clearing Certain Federal Spectrum.--
       (1) In general.--The President shall--
       (A) not later than 3 years after the date of the enactment 
     of this Act, begin the process of withdrawing or modifying 
     the assignment to a Federal Government station of the 
     electromagnetic spectrum described in paragraph (2); and
       (B) not later than 30 days after completing the withdrawal 
     or modification, notify the Commission that the withdrawal or 
     modification is complete.
       (2) Spectrum described.--The electromagnetic spectrum 
     described in this paragraph is the 15 megahertz of spectrum 
     between 1675 megahertz and 1710 megahertz identified under 
     paragraph (3).
       (3) Identification by secretary of commerce.--Not later 
     than 1 year after the date of the enactment of this Act, the 
     Secretary of Commerce shall submit to the President a report 
     identifying 15 megahertz of spectrum between 1675 megahertz 
     and 1710 megahertz for reallocation from Federal use to non-
     Federal use.
       (b) Reallocation and Auction.--
       (1) In general.--Notwithstanding paragraph (15)(A) of 
     section 309(j) of the Communications Act of 1934 (47 U.S.C. 
     309(j)), not later than 3 years after the date of the 
     enactment of this Act, the Commission shall, except as 
     provided in paragraph (4)--
       (A) allocate the spectrum described in paragraph (2) for 
     commercial use; and
       (B) through a system of competitive bidding under such 
     section, grant new initial licenses for the use of such 
     spectrum, subject to flexible-use service rules.
       (2) Spectrum described.--The spectrum described in this 
     paragraph is the following:
       (A) The frequencies between 1915 megahertz and 1920 
     megahertz.
       (B) The frequencies between 1995 megahertz and 2000 
     megahertz.
       (C) The frequencies described in subsection (a)(2).
       (D) The frequencies between 2155 megahertz and 2180 
     megahertz.
       (E) Fifteen megahertz of contiguous spectrum to be 
     identified by the Commission.
       (3) Proceeds to cover 110 percent of federal relocation or 
     sharing costs.--Nothing in paragraph (1) shall be construed 
     to relieve the Commission from the requirements of section 
     309(j)(16)(B) of the Communications Act of 1934 (47 U.S.C. 
     309(j)(16)(B)).
       (4) Determination by commission.--If the Commission 
     determines that the band of frequencies described in 
     paragraph (2)(A) or the band of frequencies described in 
     paragraph (2)(B) cannot be used without causing harmful 
     interference to commercial mobile service licensees in the 
     frequencies between 1930 megahertz and 1995 megahertz, the 
     Commission may not--
       (A) allocate such band for commercial use under paragraph 
     (1)(A); or

[[Page H853]]

       (B) grant licenses under paragraph (1)(B) for the use of 
     such band.
       (c) Auction Proceeds.--Section 309(j)(8) of the 
     Communications Act of 1934 (47 U.S.C. 309(j)(8)) is amended--
       (1) in subparagraph (A), by striking ``(D), and (E),'' and 
     inserting ``(D), (E), (F), and (G),'';
       (2) in subparagraph (C)(i), by striking ``subparagraph 
     (E)(ii)'' and inserting ``subparagraphs (D)(ii), (E)(ii), 
     (F), and (G)'';
       (3) in subparagraph (D)--
       (A) by striking the heading and inserting ``Proceeds from 
     reallocated federal spectrum.--'';
       (B) by striking ``Cash'' and inserting the following:
       ``(i) In general.--Except as provided in clause (ii), 
     cash''; and
       (C) by adding at the end the following:
       ``(ii) Certain other proceeds.--Notwithstanding 
     subparagraph (A) and except as provided in subparagraph (B), 
     in the case of proceeds (including deposits and upfront 
     payments from successful bidders) attributable to the auction 
     of eligible frequencies described in paragraph (2) of section 
     113(g) of the National Telecommunications and Information 
     Administration Organization Act that are required to be 
     auctioned by section 6401(b)(1)(B) of the Middle Class Tax 
     Relief and Job Creation Act of 2012, such portion of such 
     proceeds as is necessary to cover the relocation or sharing 
     costs (as defined in paragraph (3) of such section 113(g)) of 
     Federal entities relocated from such eligible frequencies 
     shall be deposited in the Spectrum Relocation Fund. The 
     remainder of such proceeds shall be deposited in the Public 
     Safety Trust Fund established by section 6413(a)(1) of the 
     Middle Class Tax Relief and Job Creation Act of 2012.''; and
       (4) by adding at the end the following:
       ``(F) Certain proceeds designated for public safety trust 
     fund.--Notwithstanding subparagraph (A) and except as 
     provided in subparagraphs (B) and (D)(ii), the proceeds 
     (including deposits and upfront payments from successful 
     bidders) from the use of a system of competitive bidding 
     under this subsection pursuant to section 6401(b)(1)(B) of 
     the Middle Class Tax Relief and Job Creation Act of 2012 
     shall be deposited in the Public Safety Trust Fund 
     established by section 6413(a)(1) of such Act.''.

     SEC. 6402. GENERAL AUTHORITY FOR INCENTIVE AUCTIONS.

       Section 309(j)(8) of the Communications Act of 1934, as 
     amended by section 6401(c), is further amended by adding at 
     the end the following:
       ``(G) Incentive auctions.--
       ``(i) In general.--Notwithstanding subparagraph (A) and 
     except as provided in subparagraph (B), the Commission may 
     encourage a licensee to relinquish voluntarily some or all of 
     its licensed spectrum usage rights in order to permit the 
     assignment of new initial licenses subject to flexible-use 
     service rules by sharing with such licensee a portion, based 
     on the value of the relinquished rights as determined in the 
     reverse auction required by clause (ii)(I), of the proceeds 
     (including deposits and upfront payments from successful 
     bidders) from the use of a competitive bidding system under 
     this subsection.
       ``(ii) Limitations.--The Commission may not enter into an 
     agreement for a licensee to relinquish spectrum usage rights 
     in exchange for a share of auction proceeds under clause (i) 
     unless--

       ``(I) the Commission conducts a reverse auction to 
     determine the amount of compensation that licensees would 
     accept in return for voluntarily relinquishing spectrum usage 
     rights; and
       ``(II) at least two competing licensees participate in the 
     reverse auction.

       ``(iii) Treatment of revenues.--Notwithstanding 
     subparagraph (A) and except as provided in subparagraph (B), 
     the proceeds (including deposits and upfront payments from 
     successful bidders) from any auction, prior to the end of 
     fiscal year 2022, of spectrum usage rights made available 
     under clause (i) that are not shared with licensees under 
     such clause shall be deposited as follows:

       ``(I) $1,750,000,000 of the proceeds from the incentive 
     auction of broadcast television spectrum required by section 
     6403 of the Middle Class Tax Relief and Job Creation Act of 
     2012 shall be deposited in the TV Broadcaster Relocation Fund 
     established by subsection (d)(1) of such section.
       ``(II) All other proceeds shall be deposited--

       ``(aa) prior to the end of fiscal year 2022, in the Public 
     Safety Trust Fund established by section 6413(a)(1) of such 
     Act; and
       ``(bb) after the end of fiscal year 2022, in the general 
     fund of the Treasury, where such proceeds shall be dedicated 
     for the sole purpose of deficit reduction.
       ``(iv) Congressional notification.--At least 3 months 
     before any incentive auction conducted under this 
     subparagraph, the Chairman of the Commission, in consultation 
     with the Director of the Office of Management and Budget, 
     shall notify the appropriate committees of Congress of the 
     methodology for calculating the amounts that will be shared 
     with licensees under clause (i).
       ``(v) Definition.--In this subparagraph, the term 
     `appropriate committees of Congress' means--

       ``(I) the Committee on Commerce, Science, and 
     Transportation of the Senate;
       ``(II) the Committee on Appropriations of the Senate;
       ``(III) the Committee on Energy and Commerce of the House 
     of Representatives; and
       ``(IV) the Committee on Appropriations of the House of 
     Representatives.''.

     SEC. 6403. SPECIAL REQUIREMENTS FOR INCENTIVE AUCTION OF 
                   BROADCAST TV SPECTRUM.

       (a) Reverse Auction to Identify Incentive Amount.--
       (1) In general.--The Commission shall conduct a reverse 
     auction to determine the amount of compensation that each 
     broadcast television licensee would accept in return for 
     voluntarily relinquishing some or all of its broadcast 
     television spectrum usage rights in order to make spectrum 
     available for assignment through a system of competitive 
     bidding under subparagraph (G) of section 309(j)(8) of the 
     Communications Act of 1934, as added by section 6402.
       (2) Eligible relinquishments.--A relinquishment of usage 
     rights for purposes of paragraph (1) shall include the 
     following:
       (A) Relinquishing all usage rights with respect to a 
     particular television channel without receiving in return any 
     usage rights with respect to another television channel.
       (B) Relinquishing all usage rights with respect to an ultra 
     high frequency television channel in return for receiving 
     usage rights with respect to a very high frequency television 
     channel.
       (C) Relinquishing usage rights in order to share a 
     television channel with another licensee.
       (3) Confidentiality.--The Commission shall take all 
     reasonable steps necessary to protect the confidentiality of 
     Commission-held data of a licensee participating in the 
     reverse auction under paragraph (1), including withholding 
     the identity of such licensee until the reassignments and 
     reallocations (if any) under subsection (b)(1)(B) become 
     effective, as described in subsection (f)(2).
       (4) Protection of carriage rights of licensees sharing a 
     channel.--A broadcast television station that voluntarily 
     relinquishes spectrum usage rights under this subsection in 
     order to share a television channel and that possessed 
     carriage rights under section 338, 614, or 615 of the 
     Communications Act of 1934 (47 U.S.C. 338; 534; 535) on 
     November 30, 2010, shall have, at its shared location, the 
     carriage rights under such section that would apply to such 
     station at such location if it were not sharing a channel.
       (b) Reorganization of Broadcast TV Spectrum.--
       (1) In general.--For purposes of making available spectrum 
     to carry out the forward auction under subsection (c)(1), the 
     Commission--
       (A) shall evaluate the broadcast television spectrum 
     (including spectrum made available through the reverse 
     auction under subsection (a)(1)); and
       (B) may, subject to international coordination along the 
     border with Mexico and Canada--
       (i) make such reassignments of television channels as the 
     Commission considers appropriate; and
       (ii) reallocate such portions of such spectrum as the 
     Commission determines are available for reallocation.
       (2) Factors for consideration.--In making any reassignments 
     or reallocations under paragraph (1)(B), the Commission shall 
     make all reasonable efforts to preserve, as of the date of 
     the enactment of this Act, the coverage area and population 
     served of each broadcast television licensee, as determined 
     using the methodology described in OET Bulletin 69 of the 
     Office of Engineering and Technology of the Commission.
       (3) No involuntary relocation from uhf to vhf.--In making 
     any reassignments under paragraph (1)(B)(i), the Commission 
     may not involuntarily reassign a broadcast television 
     licensee--
       (A) from an ultra high frequency television channel to a 
     very high frequency television channel; or
       (B) from a television channel between the frequencies from 
     174 megahertz to 216 megahertz to a television channel 
     between the frequencies from 54 megahertz to 88 megahertz.
       (4) Payment of relocation costs.--
       (A) In general.--Except as provided in subparagraph (B), 
     from amounts made available under subsection (d)(2), the 
     Commission shall reimburse costs reasonably incurred by--
       (i) a broadcast television licensee that was reassigned 
     under paragraph (1)(B)(i) from one ultra high frequency 
     television channel to a different ultra high frequency 
     television channel, from one very high frequency television 
     channel to a different very high frequency television 
     channel, or, in accordance with subsection (g)(1)(B), from a 
     very high frequency television channel to an ultra high 
     frequency television channel, in order for the licensee to 
     relocate its television service from one channel to the 
     other;
       (ii) a multichannel video programming distributor in order 
     to continue to carry the signal of a broadcast television 
     licensee that--

       (I) is described in clause (i);
       (II) voluntarily relinquishes spectrum usage rights under 
     subsection (a) with respect to an ultra high frequency 
     television channel in return for receiving usage rights with 
     respect to a very high frequency television channel; or
       (III) voluntarily relinquishes spectrum usage rights under 
     subsection (a) to share a television channel with another 
     licensee; or

[[Page H854]]

       (iii) a channel 37 incumbent user, in order to relocate to 
     other suitable spectrum, provided that all such users can be 
     relocated and that the total relocation costs of such users 
     do not exceed $300,000,000. For the purpose of this section, 
     the spectrum made available through relocation of channel 37 
     incumbent users shall be deemed as spectrum reclaimed through 
     a reverse auction under section 6403(a).
       (B) Regulatory relief.--In lieu of reimbursement for 
     relocation costs under subparagraph (A), a broadcast 
     television licensee may accept, and the Commission may grant 
     as it considers appropriate, a waiver of the service rules of 
     the Commission to permit the licensee, subject to 
     interference protections, to make flexible use of the 
     spectrum assigned to the licensee to provide services other 
     than broadcast television services. Such waiver shall only 
     remain in effect while the licensee provides at least 1 
     broadcast television program stream on such spectrum at no 
     charge to the public.
       (C) Limitation.--The Commission may not make reimbursements 
     under subparagraph (A) for lost revenues.
       (D) Deadline.--The Commission shall make all reimbursements 
     required by subparagraph (A) not later than the date that is 
     3 years after the completion of the forward auction under 
     subsection (c)(1).
       (5) Low-power television usage rights.--Nothing in this 
     subsection shall be construed to alter the spectrum usage 
     rights of low-power television stations.
       (c) Forward Auction.--
       (1) Auction required.--The Commission shall conduct a 
     forward auction in which--
       (A) the Commission assigns licenses for the use of the 
     spectrum that the Commission reallocates under subsection 
     (b)(1)(B)(ii); and
       (B) the amount of the proceeds that the Commission shares 
     under clause (i) of section 309(j)(8)(G) of the 
     Communications Act of 1934 with each licensee whose bid the 
     Commission accepts in the reverse auction under subsection 
     (a)(1) is not less than the amount of such bid.
       (2) Minimum proceeds.--
       (A) In general.--If the amount of the proceeds from the 
     forward auction under paragraph (1) is not greater than the 
     sum described in subparagraph (B), no licenses shall be 
     assigned through such forward auction, no reassignments or 
     reallocations under subsection (b)(1)(B) shall become 
     effective, and the Commission may not revoke any spectrum 
     usage rights by reason of a bid that the Commission accepts 
     in the reverse auction under subsection (a)(1).
       (B) Sum described.--The sum described in this subparagraph 
     is the sum of--
       (i) the total amount of compensation that the Commission 
     must pay successful bidders in the reverse auction under 
     subsection (a)(1);
       (ii) the costs of conducting such forward auction that the 
     salaries and expenses account of the Commission is required 
     to retain under section 309(j)(8)(B) of the Communications 
     Act of 1934 (47 U.S.C. 309(j)(8)(B)); and
       (iii) the estimated costs for which the Commission is 
     required to make reimbursements under subsection (b)(4)(A).
       (C) Administrative costs.--The amount of the proceeds from 
     the forward auction under paragraph (1) that the salaries and 
     expenses account of the Commission is required to retain 
     under section 309(j)(8)(B) of the Communications Act of 1934 
     (47 U.S.C. 309(j)(8)(B)) shall be sufficient to cover the 
     costs incurred by the Commission in conducting the reverse 
     auction under subsection (a)(1), conducting the evaluation of 
     the broadcast television spectrum under subparagraph (A) of 
     subsection (b)(1), and making any reassignments or 
     reallocations under subparagraph (B) of such subsection, in 
     addition to the costs incurred by the Commission in 
     conducting such forward auction.
       (3) Factor for consideration.--In conducting the forward 
     auction under paragraph (1), the Commission shall consider 
     assigning licenses that cover geographic areas of a variety 
     of different sizes.
       (d) TV Broadcaster Relocation Fund.--
       (1) Establishment.--There is established in the Treasury of 
     the United States a fund to be known as the TV Broadcaster 
     Relocation Fund.
       (2) Payment of relocation costs.--Any amounts borrowed 
     under paragraph (3)(A) and any amounts in the TV Broadcaster 
     Relocation Fund that are not necessary for reimbursement of 
     the general fund of the Treasury for such borrowed amounts 
     shall be available to the Commission to make the payments 
     required by subsection (b)(4)(A).
       (3) Borrowing authority.--
       (A) In general.--Beginning on the date when any 
     reassignments or reallocations under subsection (b)(1)(B) 
     become effective, as provided in subsection (f)(2), and 
     ending when $1,000,000,000 has been deposited in the TV 
     Broadcaster Relocation Fund, the Commission may borrow from 
     the Treasury of the United States an amount not to exceed 
     $1,000,000,000 to use toward the payments required by 
     subsection (b)(4)(A).
       (B) Reimbursement.--The Commission shall reimburse the 
     general fund of the Treasury, without interest, for any 
     amounts borrowed under subparagraph (A) as funds are 
     deposited into the TV Broadcaster Relocation Fund.
       (4) Transfer of unused funds.--If any amounts remain in the 
     TV Broadcaster Relocation Fund after the date that is 3 years 
     after the completion of the forward auction under subsection 
     (c)(1), the Secretary of the Treasury shall--
       (A) prior to the end of fiscal year 2022, transfer such 
     amounts to the Public Safety Trust Fund established by 
     section 6413(a)(1); and
       (B) after the end of fiscal year 2022, transfer such 
     amounts to the general fund of the Treasury, where such 
     amounts shall be dedicated for the sole purpose of deficit 
     reduction.
       (e) Numerical Limitation on Auctions and Reorganization.--
     The Commission may not complete more than one reverse auction 
     under subsection (a)(1) or more than one reorganization of 
     the broadcast television spectrum under subsection (b).
       (f) Timing.--
       (1) Contemporaneous auctions and reorganization 
     permitted.--The Commission may conduct the reverse auction 
     under subsection (a)(1), any reassignments or reallocations 
     under subsection (b)(1)(B), and the forward auction under 
     subsection (c)(1) on a contemporaneous basis.
       (2) Effectiveness of reassignments and reallocations.--
     Notwithstanding paragraph (1), no reassignments or 
     reallocations under subsection (b)(1)(B) shall become 
     effective until the completion of the reverse auction under 
     subsection (a)(1) and the forward auction under subsection 
     (c)(1), and, to the extent practicable, all such 
     reassignments and reallocations shall become effective 
     simultaneously.
       (3) Deadline.--The Commission may not conduct the reverse 
     auction under subsection (a)(1) or the forward auction under 
     subsection (c)(1) after the end of fiscal year 2022.
       (4) Limit on discretion regarding auction timing.--Section 
     309(j)(15)(A) of the Communications Act of 1934 (47 U.S.C. 
     309(j)(15)(A)) shall not apply in the case of an auction 
     conducted under this section.
       (g) Limitation on Reorganization Authority.--
       (1) In general.--During the period described in paragraph 
     (2), the Commission may not--
       (A) involuntarily modify the spectrum usage rights of a 
     broadcast television licensee or reassign such a licensee to 
     another television channel except--
       (i) in accordance with this section; or
       (ii) in the case of a violation by such licensee of the 
     terms of its license or a specific provision of a statute 
     administered by the Commission, or a regulation of the 
     Commission promulgated under any such provision; or
       (B) reassign a broadcast television licensee from a very 
     high frequency television channel to an ultra high frequency 
     television channel, unless--
       (i) such a reassignment will not decrease the total amount 
     of ultra high frequency spectrum made available for 
     reallocation under this section; or
       (ii) a request from such licensee for the reassignment was 
     pending at the Commission on May 31, 2011.
       (2) Period described.--The period described in this 
     paragraph is the period beginning on the date of the 
     enactment of this Act and ending on the earliest of--
       (A) the first date when the reverse auction under 
     subsection (a)(1), the reassignments and reallocations (if 
     any) under subsection (b)(1)(B), and the forward auction 
     under subsection (c)(1) have been completed;
       (B) the date of a determination by the Commission that the 
     amount of the proceeds from the forward auction under 
     subsection (c)(1) is not greater than the sum described in 
     subsection (c)(2)(B); or
       (C) September 30, 2022.
       (h) Protest Right Inapplicable.--The right of a licensee to 
     protest a proposed order of modification of its license under 
     section 316 of the Communications Act of 1934 (47 U.S.C. 316) 
     shall not apply in the case of a modification made under this 
     section.
       (i) Commission Authority.--Nothing in subsection (b) shall 
     be construed to--
       (1) expand or contract the authority of the Commission, 
     except as otherwise expressly provided; or
       (2) prevent the implementation of the Commission's ``White 
     Spaces'' Second Report and Order and Memorandum Opinion and 
     Order (FCC 08 260, adopted November 4, 2008) in the spectrum 
     that remains allocated for broadcast television use after the 
     reorganization required by such subsection.

     SEC. 6404. CERTAIN CONDITIONS ON AUCTION PARTICIPATION 
                   PROHIBITED.

       Section 309(j) of the Communications Act of 1934 (47 U.S.C. 
     309(j)) is amended by adding at the end the following new 
     paragraph:
       ``(17) Certain conditions on auction participation 
     prohibited.--
       ``(A) In general.--Notwithstanding any other provision of 
     law, the Commission may not prevent a person from 
     participating in a system of competitive bidding under this 
     subsection if such person--
       ``(i) complies with all the auction procedures and other 
     requirements to protect the auction process established by 
     the Commission; and
       ``(ii) either--

       ``(I) meets the technical, financial, character, and 
     citizenship qualifications that the Commission may require 
     under section 303(l)(1), 308(b), or 310 to hold a license; or
       ``(II) would meet such license qualifications by means 
     approved by the Commission prior to the grant of the license.

       ``(B) Clarification of authority.--Nothing in subparagraph 
     (A) affects any authority the Commission has to adopt and 
     enforce rules of general applicability, including rules

[[Page H855]]

     concerning spectrum aggregation that promote competition.''.

     SEC. 6405. EXTENSION OF AUCTION AUTHORITY.

       Section 309(j)(11) of the Communications Act of 1934 (47 
     U.S.C. 309(j)(11)) is amended by striking ``2012'' and 
     inserting ``2022''.

     SEC. 6406. UNLICENSED USE IN THE 5 GHZ BAND.

       (a) Modification of Commission Regulations to Allow Certain 
     Unlicensed Use.--
       (1) In general.--Subject to paragraph (2), not later than 1 
     year after the date of the enactment of this Act, the 
     Commission shall begin a proceeding to modify part 15 of 
     title 47, Code of Federal Regulations, to allow unlicensed U 
     NII devices to operate in the 5350 5470 MHz band.
       (2) Required determinations.--The Commission may make the 
     modification described in paragraph (1) only if the 
     Commission, in consultation with the Assistant Secretary, 
     determines that--
       (A) licensed users will be protected by technical 
     solutions, including use of existing, modified, or new 
     spectrum-sharing technologies and solutions, such as dynamic 
     frequency selection; and
       (B) the primary mission of Federal spectrum users in the 
     5350 5470 MHz band will not be compromised by the 
     introduction of unlicensed devices.
       (b) Study by NTIA.--
       (1) In general.--The Assistant Secretary, in consultation 
     with the Department of Defense and other impacted agencies, 
     shall conduct a study evaluating known and proposed spectrum-
     sharing technologies and the risk to Federal users if 
     unlicensed U NII devices were allowed to operate in the 5350 
     5470 MHz band and in the 5850 5925 MHz band.
       (2) Submission.--The Assistant Secretary shall submit to 
     the Commission and the Committee on Energy and Commerce of 
     the House of Representatives and the Committee on Commerce, 
     Science, and Transportation of the Senate--
       (A) not later than 8 months after the date of the enactment 
     of this Act, a report on the portion of the study required by 
     paragraph (1) with respect to the 5350 5470 MHz band; and
       (B) not later than 18 months after the date of the 
     enactment of this Act, a report on the portion of the study 
     required by paragraph (1) with respect to the 5850 5925 MHz 
     band.
       (c) Definitions.--In this section:
       (1) 5350 5470 mhz band.--The term ``5350 5470 MHz band'' 
     means the portion of the electromagnetic spectrum between the 
     frequencies from 5350 megahertz to 5470 megahertz.
       (2) 5850 5925 mhz band.--The term ``5850 5925 MHz band'' 
     means the portion of the electromagnetic spectrum between the 
     frequencies from 5850 megahertz to 5925 megahertz.

     SEC. 6407. GUARD BANDS AND UNLICENSED USE.

       (a) In General.--Nothing in subparagraph (G) of section 
     309(j)(8) of the Communications Act of 1934, as added by 
     section 6402, or in section 6403 shall be construed to 
     prevent the Commission from using relinquished or other 
     spectrum to implement band plans with guard bands.
       (b) Size of Guard Bands.--Such guard bands shall be no 
     larger than is technically reasonable to prevent harmful 
     interference between licensed services outside the guard 
     bands.
       (c) Unlicensed Use in Guard Bands.--The Commission may 
     permit the use of such guard bands for unlicensed use.
       (d) Database.--Unlicensed use shall rely on a database or 
     subsequent methodology as determined by the Commission.
       (e) Protections Against Harmful Interference.--The 
     Commission may not permit any use of a guard band that the 
     Commission determines would cause harmful interference to 
     licensed services.

     SEC. 6408. STUDY ON RECEIVER PERFORMANCE AND SPECTRUM 
                   EFFICIENCY.

       (a) In General.--The Comptroller General of the United 
     States shall conduct a study to consider efforts to ensure 
     that each transmission system is designed and operated so 
     that reasonable use of adjacent spectrum does not excessively 
     impair the functioning of such system.
       (b) Required Considerations.--In conducting the study 
     required by subsection (a), the Comptroller General shall 
     consider--
       (1) the value of--
       (A) improving receiver performance as it relates to 
     increasing spectral efficiency;
       (B) improving the operation of services that are located in 
     adjacent spectrum; and
       (C) narrowing the guard bands between adjacent spectrum 
     use;
       (2) the role of manufacturers, commercial licensees, and 
     government users with respect to their transmission systems 
     and the use of adjacent spectrum;
       (3) the feasibility of industry self-compliance with 
     respect to the design and operational requirements of 
     transmission systems and the reasonable use of adjacent 
     spectrum; and
       (4) the value of action by the Commission and the Assistant 
     Secretary to establish, by rule, technical requirements or 
     standards for non-Federal and Federal use, respectively, with 
     respect to the reasonable use of portions of the radio 
     spectrum that are adjacent to each other.
       (c) Report.--Not later than 1 year after the date of the 
     enactment of this Act, the Comptroller General shall submit a 
     report on the results of the study required by subsection (a) 
     to the Committee on Energy and Commerce of the House of 
     Representatives and the Committee on Commerce, Science, and 
     Transportation of the Senate.
       (d) Transmission System Defined.--In this section, the term 
     ``transmission system'' means any telecommunications, 
     broadcast, satellite, commercial mobile service, or other 
     communications system that employs radio spectrum.

     SEC. 6409. WIRELESS FACILITIES DEPLOYMENT.

       (a) Facility Modifications.--
       (1) In general.--Notwithstanding section 704 of the 
     Telecommunications Act of 1996 (Public Law 104 104) or any 
     other provision of law, a State or local government may not 
     deny, and shall approve, any eligible facilities request for 
     a modification of an existing wireless tower or base station 
     that does not substantially change the physical dimensions of 
     such tower or base station.
       (2) Eligible facilities request.--For purposes of this 
     subsection, the term ``eligible facilities request'' means 
     any request for modification of an existing wireless tower or 
     base station that involves--
       (A) collocation of new transmission equipment;
       (B) removal of transmission equipment; or
       (C) replacement of transmission equipment.
       (3) Applicability of environmental laws.--Nothing in 
     paragraph (1) shall be construed to relieve the Commission 
     from the requirements of the National Historic Preservation 
     Act or the National Environmental Policy Act of 1969.
       (b) Federal Easements and Rights-of-way.--
       (1) Grant.--If an executive agency, a State, a political 
     subdivision or agency of a State, or a person, firm, or 
     organization applies for the grant of an easement or right-
     of-way to, in, over, or on a building or other property owned 
     by the Federal Government for the right to install, 
     construct, and maintain wireless service antenna structures 
     and equipment and backhaul transmission equipment, the 
     executive agency having control of the building or other 
     property may grant to the applicant, on behalf of the Federal 
     Government, an easement or right-of-way to perform such 
     installation, construction, and maintenance.
       (2) Application.--The Administrator of General Services 
     shall develop a common form for applications for easements 
     and rights-of-way under paragraph (1) for all executive 
     agencies that shall be used by applicants with respect to the 
     buildings or other property of each such agency.
       (3) Fee.--
       (A) In general.--Notwithstanding any other provision of 
     law, the Administrator of General Services shall establish a 
     fee for the grant of an easement or right-of-way pursuant to 
     paragraph (1) that is based on direct cost recovery.
       (B) Exceptions.--The Administrator of General Services may 
     establish exceptions to the fee amount required under 
     subparagraph (A)--
       (i) in consideration of the public benefit provided by a 
     grant of an easement or right-of-way; and
       (ii) in the interest of expanding wireless and broadband 
     coverage.
       (4) Use of fees collected.--Any fee amounts collected by an 
     executive agency pursuant to paragraph (3) may be made 
     available, as provided in appropriations Acts, to such agency 
     to cover the costs of granting the easement or right-of-way.
       (c) Master Contracts for Wireless Facility Sitings.--
       (1) In general.--Notwithstanding section 704 of the 
     Telecommunications Act of 1996 or any other provision of law, 
     and not later than 60 days after the date of the enactment of 
     this Act, the Administrator of General Services shall--
       (A) develop 1 or more master contracts that shall govern 
     the placement of wireless service antenna structures on 
     buildings and other property owned by the Federal Government; 
     and
       (B) in developing the master contract or contracts, 
     standardize the treatment of the placement of wireless 
     service antenna structures on building rooftops or facades, 
     the placement of wireless service antenna equipment on 
     rooftops or inside buildings, the technology used in 
     connection with wireless service antenna structures or 
     equipment placed on Federal buildings and other property, and 
     any other key issues the Administrator of General Services 
     considers appropriate.
       (2) Applicability.--The master contract or contracts 
     developed by the Administrator of General Services under 
     paragraph (1) shall apply to all publicly accessible 
     buildings and other property owned by the Federal Government, 
     unless the Administrator of General Services decides that 
     issues with respect to the siting of a wireless service 
     antenna structure on a specific building or other property 
     warrant nonstandard treatment of such building or other 
     property.
       (3) Application.--The Administrator of General Services 
     shall develop a common form or set of forms for wireless 
     service antenna structure siting applications under this 
     subsection for all executive agencies that shall be used by 
     applicants with respect to the buildings and other property 
     of each such agency.
       (d) Executive Agency Defined.--In this section, the term 
     ``executive agency'' has the meaning given such term in 
     section 102 of title 40, United States Code.

[[Page H856]]

     SEC. 6410. FUNCTIONAL RESPONSIBILITY OF NTIA TO ENSURE 
                   EFFICIENT USE OF SPECTRUM.

       Section 103(b)(2) of the National Telecommunications and 
     Information Administration Organization Act (47 U.S.C. 
     902(b)(2)) is amended by adding at the end the following:
       ``(U) The responsibility to promote the best possible and 
     most efficient use of electromagnetic spectrum resources 
     across the Federal Government, subject to and consistent with 
     the needs and missions of Federal agencies.''.

     SEC. 6411. SYSTEM CERTIFICATION.

       Not later than 6 months after the date of the enactment of 
     this Act, the Director of the Office of Management and Budget 
     shall update and revise section 33.4 of OMB Circular A 11 to 
     reflect the recommendations regarding such Circular made in 
     the Commerce Spectrum Management Advisory Committee Incentive 
     Subcommittee report, adopted January 11, 2011.

     SEC. 6412. DEPLOYMENT OF 11 GHZ, 18 GHZ, AND 23 GHZ MICROWAVE 
                   BANDS.

       (a) FCC Report on Rejection Rate.--Not later than 9 months 
     after the date of the enactment of this Act, the Commission 
     shall submit to the Committee on Energy and Commerce of the 
     House of Representatives and the Committee on Commerce, 
     Science, and Transportation of the Senate a report on the 
     rejection rate for the spectrum described in subsection (c).
       (b) GAO Study on Deployment.--
       (1) In general.--The Comptroller General of the United 
     States shall conduct a study to assess whether the spectrum 
     described in subsection (c) is being deployed in such a 
     manner that, in areas with high demand for common carrier 
     licenses for the use of such spectrum, market forces--
       (A) provide adequate incentive for the efficient use of 
     such spectrum; and
       (B) ensure that the Federal Government receives maximum 
     revenue for such spectrum through competitive bidding under 
     section 309(j) of the Communications Act of 1934 (47 U.S.C. 
     309(j)).
       (2) Factors for consideration.--In conducting the study 
     required by paragraph (1), the Comptroller General shall take 
     into consideration--
       (A) spectrum that is adjacent to the spectrum described in 
     subsection (c) and that was assigned through competitive 
     bidding under section 309(j) of the Communications Act of 
     1934; and
       (B) the rejection rate for the spectrum described in 
     subsection (c), current as of the time of the assessment and 
     as projected for the future, in markets in which there is a 
     high demand for common carrier licenses for the use of such 
     spectrum.
       (3) Report.--Not later than 9 months after the date of the 
     enactment of this Act, the Comptroller General shall submit a 
     report on the study required by paragraph (1) to--
       (A) the Commission; and
       (B) the Committee on Energy and Commerce of the House of 
     Representatives and the Committee on Commerce, Science, and 
     Transportation of the Senate.
       (c) Spectrum Described.--The spectrum described in this 
     subsection is the portions of the electromagnetic spectrum 
     between the frequencies from 10,700 megahertz to 11,700 
     megahertz, from 17,700 megahertz to 19,700 megahertz, and 
     from 21,200 megahertz to 23,600 megahertz.
       (d) Rejection Rate Defined.--In this section, the term 
     ``rejection rate'' means the number and percent of 
     applications (whether made to the Commission or to a third-
     party coordinator) for common carrier use of spectrum that 
     were not granted because of lack of availability of such 
     spectrum or interference concerns of existing licensees.
       (e) No Additional Funds Authorized.--Funds necessary to 
     carry out this section shall be derived from funds otherwise 
     authorized to be appropriated.

     SEC. 6413. PUBLIC SAFETY TRUST FUND.

       (a) Establishment of Public Safety Trust Fund.--
       (1) In general.--There is established in the Treasury of 
     the United States a trust fund to be known as the Public 
     Safety Trust Fund.
       (2) Availability.--Amounts deposited in the Public Safety 
     Trust Fund shall remain available through fiscal year 2022. 
     Any amounts remaining in the Fund after the end of such 
     fiscal year shall be deposited in the general fund of the 
     Treasury, where such amounts shall be dedicated for the sole 
     purpose of deficit reduction.
       (b) Use of Fund.--As amounts are deposited in the Public 
     Safety Trust Fund, such amounts shall be used to make the 
     following deposits or payments in the following order of 
     priority:
       (1) Repayment of amount borrowed for first responder 
     network authority.--An amount not to exceed $2,000,000,000 
     shall be available to the NTIA to reimburse the general fund 
     of the Treasury for any amounts borrowed under section 6207.
       (2) State and local implementation fund.--$135,000,000 
     shall be deposited in the State and Local Implementation Fund 
     established by section 6301.
       (3) Buildout by first responder network authority.--
     $7,000,000,000, reduced by the amount borrowed under section 
     6207, shall be deposited in the Network Construction Fund 
     established by section 6206.
       (4) Public safety research.--$100,000,000 shall be 
     available to the Director of NIST to carry out section 6303.
       (5) Deficit reduction.--$20,400,000,000 shall be deposited 
     in the general fund of the Treasury, where such amount shall 
     be dedicated for the sole purpose of deficit reduction.
       (6) 9 1 1, e9 1 1, and next generation 9 1 1 implementation 
     grants.--$115,000,000 shall be available to the Assistant 
     Secretary and the Administrator of the National Highway 
     Traffic Safety Administration to carry out the grant program 
     under section 158 of the National Telecommunications and 
     Information Administration Organization Act, as amended by 
     section 6503 of this title.
       (7) Additional public safety research.--$200,000,000 shall 
     be available to the Director of NIST to carry out section 
     6303.
       (8) Additional deficit reduction.--Any remaining amounts 
     deposited in the Public Safety Trust Fund shall be deposited 
     in the general fund of the Treasury, where such amounts shall 
     be dedicated for the sole purpose of deficit reduction.
       (c) Investment.--Amounts in the Public Safety Trust Fund 
     shall be invested in accordance with section 9702 of title 
     31, United States Code, and any interest on, and proceeds 
     from, any such investment shall be credited to, and become a 
     part of, the Fund.

     SEC. 6414. STUDY ON EMERGENCY COMMUNICATIONS BY AMATEUR RADIO 
                   AND IMPEDIMENTS TO AMATEUR RADIO 
                   COMMUNICATIONS.

       (a) In General.--Not later than 180 days after the date of 
     the enactment of this Act, the Commission, in consultation 
     with the Office of Emergency Communications in the Department 
     of Homeland Security, shall--
       (1) complete a study on the uses and capabilities of 
     amateur radio service communications in emergencies and 
     disaster relief; and
       (2) submit to the Committee on Energy and Commerce of the 
     House of Representatives and the Committee on Commerce, 
     Science, and Transportation of the Senate a report on the 
     findings of such study.
       (b) Contents.--The study required by subsection (a) shall 
     include--
       (1)(A) a review of the importance of emergency amateur 
     radio service communications relating to disasters, severe 
     weather, and other threats to lives and property in the 
     United States; and
       (B) recommendations for--
       (i) enhancements in the voluntary deployment of amateur 
     radio operators in disaster and emergency communications and 
     disaster relief efforts; and
       (ii) improved integration of amateur radio operators in the 
     planning and furtherance of initiatives of the Federal 
     Government; and
       (2)(A) an identification of impediments to enhanced amateur 
     radio service communications, such as the effects of 
     unreasonable or unnecessary private land use restrictions on 
     residential antenna installations; and
       (B) recommendations regarding the removal of such 
     impediments.
       (c) Expertise.--In conducting the study required by 
     subsection (a), the Commission shall use the expertise of 
     stakeholder entities and organizations, including the amateur 
     radio, emergency response, and disaster communications 
     communities.

       Subtitle E--Next Generation 9 1 1 Advancement Act of 2012

     SEC. 6501. SHORT TITLE.

       This subtitle may be cited as the ``Next Generation 9 1 1 
     Advancement Act of 2012''.

     SEC. 6502. DEFINITIONS.

       In this subtitle, the following definitions shall apply:
       (1) 9 1 1 services and e9 1 1 services.--The terms ``9 1 1 
     services'' and ``E9 1 1 services'' shall have the meaning 
     given those terms in section 158 of the National 
     Telecommunications and Information Administration 
     Organization Act (47 U.S.C. 942), as amended by this 
     subtitle.
       (2) Multi-line telephone system.--The term ``multi-line 
     telephone system'' or ``MLTS'' means a system comprised of 
     common control units, telephone sets, control hardware and 
     software and adjunct systems, including network and premises 
     based systems, such as Centrex and VoIP, as well as PBX, 
     Hybrid, and Key Telephone Systems (as classified by the 
     Commission under part 68 of title 47, Code of Federal 
     Regulations), and includes systems owned or leased by 
     governmental agencies and non-profit entities, as well as for 
     profit businesses.
       (3) Office.--The term ``Office'' means the 9 1 1 
     Implementation Coordination Office established under section 
     158 of the National Telecommunications and Information 
     Administration Organization Act (47 U.S.C. 942), as amended 
     by this subtitle.

     SEC. 6503. COORDINATION OF 9 1 1 IMPLEMENTATION.

       Section 158 of the National Telecommunications and 
     Information Administration Organization Act (47 U.S.C. 942) 
     is amended to read as follows:

     ``SEC. 158. COORDINATION OF 9 1 1, E9 1 1, AND NEXT 
                   GENERATION 9 1 1 IMPLEMENTATION.

       ``(a) 9 1 1 Implementation Coordination Office.--
       ``(1) Establishment and continuation.--The Assistant 
     Secretary and the Administrator of the National Highway 
     Traffic Safety Administration shall--
       ``(A) establish and further a program to facilitate 
     coordination and communication between Federal, State, and 
     local emergency communications systems, emergency personnel, 
     public safety organizations, telecommunications carriers, and 
     telecommunications equipment manufacturers and vendors 
     involved in the implementation of 9 1 1 services; and
       ``(B) establish a 9 1 1 Implementation Coordination Office 
     to implement the provisions of this section.

[[Page H857]]

       ``(2) Management plan.--
       ``(A) Development.--The Assistant Secretary and the 
     Administrator shall develop a management plan for the grant 
     program established under this section, including by 
     developing--
       ``(i) plans related to the organizational structure of such 
     program; and
       ``(ii) funding profiles for each fiscal year of the 
     duration of such program.
       ``(B) Submission to congress.--Not later than 90 days after 
     the date of enactment of the Next Generation 9 1 1 
     Advancement Act of 2012, the Assistant Secretary and the 
     Administrator shall submit the management plan developed 
     under subparagraph (A) to--
       ``(i) the Committees on Commerce, Science, and 
     Transportation and Appropriations of the Senate; and
       ``(ii) the Committees on Energy and Commerce and 
     Appropriations of the House of Representatives.
       ``(3) Purpose of office.--The Office shall--
       ``(A) take actions, in concert with coordinators designated 
     in accordance with subsection (b)(3)(A)(ii), to improve 
     coordination and communication with respect to the 
     implementation of 9 1 1 services, E9 1 1 services, and Next 
     Generation 9 1 1 services;
       ``(B) develop, collect, and disseminate information 
     concerning practices, procedures, and technology used in the 
     implementation of 9 1 1 services, E9 1 1 services, and Next 
     Generation 9 1 1 services;
       ``(C) advise and assist eligible entities in the 
     preparation of implementation plans required under subsection 
     (b)(3)(A)(iii);
       ``(D) receive, review, and recommend the approval or 
     disapproval of applications for grants under subsection (b); 
     and
       ``(E) oversee the use of funds provided by such grants in 
     fulfilling such implementation plans.
       ``(4) Reports.--The Assistant Secretary and the 
     Administrator shall provide an annual report to Congress by 
     the first day of October of each year on the activities of 
     the Office to improve coordination and communication with 
     respect to the implementation of 9 1 1 services, E9 1 1 
     services, and Next Generation 9 1 1 services.
       ``(b) 9 1 1, E9 1 1, and Next Generation 9 1 1 
     Implementation Grants.--
       ``(1) Matching grants.--The Assistant Secretary and the 
     Administrator, acting through the Office, shall provide 
     grants to eligible entities for--
       ``(A) the implementation and operation of 9 1 1 services, 
     E9 1 1 services, migration to an IP-enabled emergency 
     network, and adoption and operation of Next Generation 9 1 1 
     services and applications;
       ``(B) the implementation of IP-enabled emergency services 
     and applications enabled by Next Generation 9 1 1 services, 
     including the establishment of IP backbone networks and the 
     application layer software infrastructure needed to 
     interconnect the multitude of emergency response 
     organizations; and
       ``(C) training public safety personnel, including call-
     takers, first responders, and other individuals and 
     organizations who are part of the emergency response chain in 
     9 1 1 services.
       ``(2) Matching requirement.--The Federal share of the cost 
     of a project eligible for a grant under this section shall 
     not exceed 60 percent.
       ``(3) Coordination required.--In providing grants under 
     paragraph (1), the Assistant Secretary and the Administrator 
     shall require an eligible entity to certify in its 
     application that--
       ``(A) in the case of an eligible entity that is a State 
     government, the entity--
       ``(i) has coordinated its application with the public 
     safety answering points located within the jurisdiction of 
     such entity;
       ``(ii) has designated a single officer or governmental body 
     of the entity to serve as the coordinator of implementation 
     of 9 1 1 services, except that such designation need not vest 
     such coordinator with direct legal authority to implement 9 1 
     1 services, E9 1 1 services, or Next Generation 9 1 1 
     services or to manage emergency communications operations;
       ``(iii) has established a plan for the coordination and 
     implementation of 9 1 1 services, E9 1 1 services, and Next 
     Generation 9 1 1 services; and
       ``(iv) has integrated telecommunications services involved 
     in the implementation and delivery of 9 1 1 services, E9 1 1 
     services, and Next Generation 9 1 1 services; or
       ``(B) in the case of an eligible entity that is not a 
     State, the entity has complied with clauses (i), (iii), and 
     (iv) of subparagraph (A), and the State in which it is 
     located has complied with clause (ii) of such subparagraph.
       ``(4) Criteria.--Not later than 120 days after the date of 
     enactment of the Next Generation 9 1 1 Advancement Act of 
     2012, the Assistant Secretary and the Administrator shall 
     issue regulations, after providing the public with notice and 
     an opportunity to comment, prescribing the criteria for 
     selection for grants under this section. The criteria shall 
     include performance requirements and a timeline for 
     completion of any project to be financed by a grant under 
     this section. The Assistant Secretary and the Administrator 
     shall update such regulations as necessary.
       ``(c) Diversion of 9 1 1 Charges.--
       ``(1) Designated 9 1 1 charges.--For the purposes of this 
     subsection, the term `designated 9 1 1 charges' means any 
     taxes, fees, or other charges imposed by a State or other 
     taxing jurisdiction that are designated or presented as 
     dedicated to deliver or improve 9 1 1 services, E9 1 1 
     services, or Next Generation 9 1 1 services.
       ``(2) Certification.--Each applicant for a matching grant 
     under this section shall certify to the Assistant Secretary 
     and the Administrator at the time of application, and each 
     applicant that receives such a grant shall certify to the 
     Assistant Secretary and the Administrator annually thereafter 
     during any period of time during which the funds from the 
     grant are available to the applicant, that no portion of any 
     designated 9 1 1 charges imposed by a State or other taxing 
     jurisdiction within which the applicant is located are being 
     obligated or expended for any purpose other than the purposes 
     for which such charges are designated or presented during the 
     period beginning 180 days immediately preceding the date of 
     the application and continuing through the period of time 
     during which the funds from the grant are available to the 
     applicant.
       ``(3) Condition of grant.--Each applicant for a grant under 
     this section shall agree, as a condition of receipt of the 
     grant, that if the State or other taxing jurisdiction within 
     which the applicant is located, during any period of time 
     during which the funds from the grant are available to the 
     applicant, obligates or expends designated 9 1 1 charges for 
     any purpose other than the purposes for which such charges 
     are designated or presented, eliminates such charges, or 
     redesignates such charges for purposes other than the 
     implementation or operation of 9 1 1 services, E9 1 1 
     services, or Next Generation 9 1 1 services, all of the funds 
     from such grant shall be returned to the Office.
       ``(4) Penalty for providing false information.--Any 
     applicant that provides a certification under paragraph (2) 
     knowing that the information provided in the certification 
     was false shall--
       ``(A) not be eligible to receive the grant under subsection 
     (b);
       ``(B) return any grant awarded under subsection (b) during 
     the time that the certification was not valid; and
       ``(C) not be eligible to receive any subsequent grants 
     under subsection (b).
       ``(d) Funding and Termination.--
       ``(1) In general.--From the amounts made available to the 
     Assistant Secretary and the Administrator under section 
     6413(b)(6) of the Middle Class Tax Relief and Job Creation 
     Act of 2012, the Assistant Secretary and the Administrator 
     are authorized to provide grants under this section through 
     the end of fiscal year 2022. Not more than 5 percent of such 
     amounts may be obligated or expended to cover the 
     administrative costs of carrying out this section.
       ``(2) Termination.--Effective on October 1, 2022, the 
     authority provided by this section terminates and this 
     section shall have no effect.
       ``(e) Definitions.--In this section, the following 
     definitions shall apply:
       ``(1) 9 1 1 services.--The term `9 1 1 services' includes 
     both E9 1 1 services and Next Generation 9 1 1 services.
       ``(2) E9 1 1 services.--The term `E9 1 1 services' means 
     both phase I and phase II enhanced 9 1 1 services, as 
     described in section 20.18 of the Commission's regulations 
     (47 C.F.R. 20.18), as in effect on the date of enactment of 
     the Next Generation 9 1 1 Advancement Act of 2012, or as 
     subsequently revised by the Commission.
       ``(3) Eligible entity.--
       ``(A) In general.--The term `eligible entity' means a State 
     or local government or a tribal organization (as defined in 
     section 4(l) of the Indian Self-Determination and Education 
     Assistance Act (25 U.S.C. 450b(l))).
       ``(B) Instrumentalities.--The term `eligible entity' 
     includes public authorities, boards, commissions, and similar 
     bodies created by one or more eligible entities described in 
     subparagraph (A) to provide 9 1 1 services, E9 1 1 services, 
     or Next Generation 9 1 1 services.
       ``(C) Exception.--The term `eligible entity' does not 
     include any entity that has failed to submit the most 
     recently required certification under subsection (c) within 
     30 days after the date on which such certification is due.
       ``(4) Emergency call.--The term `emergency call' refers to 
     any real-time communication with a public safety answering 
     point or other emergency management or response agency, 
     including--
       ``(A) through voice, text, or video and related data; and
       ``(B) nonhuman-initiated automatic event alerts, such as 
     alarms, telematics, or sensor data, which may also include 
     real-time voice, text, or video communications.
       ``(5) Next generation 9 1 1 services.--The term `Next 
     Generation 9 1 1 services' means an IP-based system comprised 
     of hardware, software, data, and operational policies and 
     procedures that--
       ``(A) provides standardized interfaces from emergency call 
     and message services to support emergency communications;
       ``(B) processes all types of emergency calls, including 
     voice, data, and multimedia information;
       ``(C) acquires and integrates additional emergency call 
     data useful to call routing and handling;
       ``(D) delivers the emergency calls, messages, and data to 
     the appropriate public safety answering point and other 
     appropriate emergency entities;

[[Page H858]]

       ``(E) supports data or video communications needs for 
     coordinated incident response and management; and
       ``(F) provides broadband service to public safety answering 
     points or other first responder entities.
       ``(6) Office.--The term `Office' means the 9 1 1 
     Implementation Coordination Office.
       ``(7) Public safety answering point.--The term `public 
     safety answering point' has the meaning given the term in 
     section 222 of the Communications Act of 1934 (47 U.S.C. 
     222).
       ``(8) State.--The term `State' means any State of the 
     United States, the District of Columbia, Puerto Rico, 
     American Samoa, Guam, the United States Virgin Islands, the 
     Northern Mariana Islands, and any other territory or 
     possession of the United States.''.

     SEC. 6504. REQUIREMENTS FOR MULTI-LINE TELEPHONE SYSTEMS.

       (a) In General.--Not later than 270 days after the date of 
     the enactment of this Act, the Administrator of General 
     Services, in conjunction with the Office, shall issue a 
     report to Congress identifying the 9 1 1 capabilities of the 
     multi-line telephone system in use by all Federal agencies in 
     all Federal buildings and properties.
       (b) Commission Action.--
       (1) In general.--Not later than 90 days after the date of 
     the enactment of this Act, the Commission shall issue a 
     public notice seeking comment on the feasibility of MLTS 
     manufacturers including within all such systems manufactured 
     or sold after a date certain, to be determined by the 
     Commission, one or more mechanisms to provide a sufficiently 
     precise indication of a 9 1 1 caller's location, while 
     avoiding the imposition of undue burdens on MLTS 
     manufacturers, providers, and operators.
       (2) Specific requirement.--The public notice under 
     paragraph (1) shall seek comment on the National Emergency 
     Number Association's ``Technical Requirements Document On 
     Model Legislation E9 1 1 for Multi-Line Telephone Systems'' 
     (NENA 06 750, Version 2).

     SEC. 6505. GAO STUDY OF STATE AND LOCAL USE OF 9 1 1 SERVICE 
                   CHARGES.

       (a) In General.--Not later than 60 days after the date of 
     the enactment of this Act, the Comptroller General of the 
     United States shall initiate a study of--
       (1) the imposition of taxes, fees, or other charges imposed 
     by States or political subdivisions of States that are 
     designated or presented as dedicated to improve emergency 
     communications services, including 9 1 1 services or enhanced 
     9 1 1 services, or related to emergency communications 
     services operations or improvements; and
       (2) the use of revenues derived from such taxes, fees, or 
     charges.
       (b) Report.--Not later than 18 months after initiating the 
     study required by subsection (a), the Comptroller General 
     shall prepare and submit a report on the results of the study 
     to the Committee on Commerce, Science, and Transportation of 
     the Senate and the Committee on Energy and Commerce of the 
     House of Representatives setting forth the findings, 
     conclusions, and recommendations, if any, of the study, 
     including--
       (1) the identity of each State or political subdivision 
     that imposes such taxes, fees, or other charges; and
       (2) the amount of revenues obligated or expended by that 
     State or political subdivision for any purpose other than the 
     purposes for which such taxes, fees, or charges were 
     designated or presented.

     SEC. 6506. PARITY OF PROTECTION FOR PROVISION OR USE OF NEXT 
                   GENERATION 9 1 1 SERVICES.

       (a) Immunity.--A provider or user of Next Generation 9 1 1 
     services, a public safety answering point, and the officers, 
     directors, employees, vendors, agents, and authorizing 
     government entity (if any) of such provider, user, or public 
     safety answering point, shall have immunity and protection 
     from liability under Federal and State law to the extent 
     provided in subsection (b) with respect to--
       (1) the release of subscriber information related to 
     emergency calls or emergency services;
       (2) the use or provision of 9 1 1 services, E9 1 1 
     services, or Next Generation 9 1 1 services; and
       (3) other matters related to 9 1 1 services, E9 1 1 
     services, or Next Generation 9 1 1 services.
       (b) Scope of Immunity and Protection From Liability.--The 
     scope and extent of the immunity and protection from 
     liability afforded under subsection (a) shall be the same as 
     that provided under section 4 of the Wireless Communications 
     and Public Safety Act of 1999 (47 U.S.C. 615a) to wireless 
     carriers, public safety answering points, and users of 
     wireless 9 1 1 service (as defined in paragraphs (4), (3), 
     and (6), respectively, of section 6 of that Act (47 U.S.C. 
     615b)) with respect to such release, use, and other matters.

     SEC. 6507. COMMISSION PROCEEDING ON AUTODIALING.

       (a) In General.--Not later than 90 days after the date of 
     the enactment of this Act, the Commission shall initiate a 
     proceeding to create a specialized Do-Not-Call registry for 
     public safety answering points.
       (b) Features of the Registry.--The Commission shall issue 
     regulations, after providing the public with notice and an 
     opportunity to comment, that--
       (1) permit verified public safety answering point 
     administrators or managers to register the telephone numbers 
     of all 9 1 1 trunks and other lines used for the provision of 
     emergency services to the public or for communications 
     between public safety agencies;
       (2) provide a process for verifying, no less frequently 
     than once every 7 years, that registered numbers should 
     continue to appear upon the registry;
       (3) provide a process for granting and tracking access to 
     the registry by the operators of automatic dialing equipment;
       (4) protect the list of registered numbers from disclosure 
     or dissemination by parties granted access to the registry; 
     and
       (5) prohibit the use of automatic dialing or ``robocall'' 
     equipment to establish contact with registered numbers.
       (c) Enforcement.--The Commission shall--
       (1) establish monetary penalties for violations of the 
     protective regulations established pursuant to subsection 
     (b)(4) of not less than $100,000 per incident nor more than 
     $1,000,000 per incident;
       (2) establish monetary penalties for violations of the 
     prohibition on automatically dialing registered numbers 
     established pursuant to subsection (b)(5) of not less than 
     $10,000 per call nor more than $100,000 per call; and
       (3) provide for the imposition of fines under paragraphs 
     (1) or (2) that vary depending upon whether the conduct 
     leading to the violation was negligent, grossly negligent, 
     reckless, or willful, and depending on whether the violation 
     was a first or subsequent offence.

     SEC. 6508. REPORT ON COSTS FOR REQUIREMENTS AND 
                   SPECIFICATIONS OF NEXT GENERATION 9 1 1 
                   SERVICES.

       (a) In General.--Not later than 1 year after the date of 
     the enactment of this Act, the Office, in consultation with 
     the Administrator of the National Highway Traffic Safety 
     Administration, the Commission, and the Secretary of Homeland 
     Security, shall prepare and submit a report to Congress that 
     analyzes and determines detailed costs for specific Next 
     Generation 9 1 1 service requirements and specifications.
       (b) Purpose of Report.--The purpose of the report required 
     under subsection (a) is to serve as a resource for Congress 
     as it considers creating a coordinated, long-term funding 
     mechanism for the deployment and operation, accessibility, 
     application development, equipment procurement, and training 
     of personnel for Next Generation 9 1 1 services.
       (c) Required Inclusions.--The report required under 
     subsection (a) shall include the following:
       (1) How costs would be broken out geographically and 
     allocated among public safety answering points, broadband 
     service providers, and third-party providers of Next 
     Generation 9 1 1 services.
       (2) An assessment of the current state of Next Generation 9 
     1 1 service readiness among public safety answering points.
       (3) How differences in public safety answering points' 
     access to broadband across the United States may affect 
     costs.
       (4) A technical analysis and cost study of different 
     delivery platforms, such as wireline, wireless, and 
     satellite.
       (5) An assessment of the architectural characteristics, 
     feasibility, and limitations of Next Generation 9 1 1 service 
     delivery.
       (6) An analysis of the needs for Next Generation 9 1 1 
     services of persons with disabilities.
       (7) Standards and protocols for Next Generation 9 1 1 
     services and for incorporating Voice over Internet Protocol 
     and ``Real-Time Text'' standards.

     SEC. 6509. COMMISSION RECOMMENDATIONS FOR LEGAL AND STATUTORY 
                   FRAMEWORK FOR NEXT GENERATION 9 1 1 SERVICES.

       Not later than 1 year after the date of the enactment of 
     this Act, the Commission, in coordination with the Secretary 
     of Homeland Security, the Administrator of the National 
     Highway Traffic Safety Administration, and the Office, shall 
     prepare and submit a report to Congress that contains 
     recommendations for the legal and statutory framework for 
     Next Generation 9 1 1 services, consistent with 
     recommendations in the National Broadband Plan developed by 
     the Commission pursuant to the American Recovery and 
     Reinvestment Act of 2009, including the following:
       (1) A legal and regulatory framework for the development of 
     Next Generation 9 1 1 services and the transition from legacy 
     9 1 1 to Next Generation 9 1 1 networks.
       (2) Legal mechanisms to ensure efficient and accurate 
     transmission of 9 1 1 caller information to emergency 
     response agencies.
       (3) Recommendations for removing jurisdictional barriers 
     and inconsistent legacy regulations including--
       (A) proposals that would require States to remove 
     regulatory roadblocks to Next Generation 9 1 1 services 
     development, while recognizing existing State authority over 
     9 1 1 services;
       (B) eliminating outdated 9 1 1 regulations at the Federal 
     level; and
       (C) preempting inconsistent State regulations.

            Subtitle F--Telecommunications Development Fund

     SEC. 6601. NO ADDITIONAL FEDERAL FUNDS.

       Section 309(j)(8)(C)(iii) of the Communications Act of 1934 
     (47 U.S.C. 309(j)(8)(C)(iii)) is amended to read as follows:
       ``(iii) the interest accrued to the account shall be 
     deposited in the general fund of the Treasury, where such 
     amount shall be dedicated for the sole purpose of deficit 
     reduction.''.

[[Page H859]]

     SEC. 6602. INDEPENDENCE OF THE FUND.

       Section 714 of the Communications Act of 1934 (47 U.S.C. 
     614) is amended--
       (1) by striking subsection (c) and inserting the following:
       ``(c) Independent Board of Directors.--The Fund shall have 
     a Board of Directors consisting of 5 people with experience 
     in areas including finance, investment banking, government 
     banking, communications law and administrative practice, and 
     public policy. The Board of Directors shall select annually a 
     Chair from among the directors. A nominating committee, 
     comprised of the Chair and 2 other directors selected by the 
     Chair, shall appoint additional directors. The Fund's bylaws 
     shall regulate the other aspects of the Board of Directors, 
     including provisions relating to meetings, quorums, 
     committees, and other matters, all as typically contained in 
     the bylaws of a similar private investment fund.'';
       (2) in subsection (d)--
       (A) by striking ``(after consultation with the Commission 
     and the Secretary of the Treasury)'';
       (B) by striking paragraph (1); and
       (C) by redesignating paragraphs (2) through (4) as 
     paragraphs (1) through (3), respectively; and
       (3) in subsection (g), by striking ``subsection (d)(2)'' 
     and inserting ``subsection (d)(1)''.

                Subtitle G--Federal Spectrum Relocation

     SEC. 6701. RELOCATION OF AND SPECTRUM SHARING BY FEDERAL 
                   GOVERNMENT STATIONS.

       (a) In General.--Section 113 of the National 
     Telecommunications and Information Administration 
     Organization Act (47 U.S.C. 923) is amended--
       (1) in subsection (g)--
       (A) by striking the heading and inserting ``Relocation of 
     and Spectrum Sharing by Federal Government Stations.--'';
       (B) by amending paragraph (1) to read as follows:
       ``(1) Eligible federal entities.--Any Federal entity that 
     operates a Federal Government station authorized to use a 
     band of eligible frequencies described in paragraph (2) and 
     that incurs relocation or sharing costs because of planning 
     for an auction of spectrum frequencies or the reallocation of 
     spectrum frequencies from Federal use to exclusive non-
     Federal use or to shared use shall receive payment for such 
     relocation or sharing costs from the Spectrum Relocation 
     Fund, in accordance with this section and section 118. For 
     purposes of this paragraph, Federal power agencies exempted 
     under subsection (c)(4) that choose to relocate from the 
     frequencies identified for reallocation pursuant to 
     subsection (a) are eligible to receive payment under this 
     paragraph.'';
       (C) by amending paragraph (2)(B) to read as follows:
       ``(B) any other band of frequencies reallocated from 
     Federal use to non-Federal use or to shared use after January 
     1, 2003, that is assigned by competitive bidding pursuant to 
     section 309(j) of the Communications Act of 1934 (47 U.S.C. 
     309(j)).'';
       (D) by amending paragraph (3) to read as follows:
       ``(3) Relocation or sharing costs defined.--
       ``(A) In general.--For purposes of this section and section 
     118, the term `relocation or sharing costs' means the costs 
     incurred by a Federal entity in connection with the auction 
     of spectrum frequencies previously assigned to such entity or 
     the sharing of spectrum frequencies assigned to such entity 
     (including the auction or a planned auction of the rights to 
     use spectrum frequencies on a shared basis with such entity) 
     in order to achieve comparable capability of systems as 
     before the relocation or sharing arrangement. Such term 
     includes, with respect to relocation or sharing, as the case 
     may be--
       ``(i) the costs of any modification or replacement of 
     equipment, spares, associated ancillary equipment, software, 
     facilities, operating manuals, training, or compliance with 
     regulations that are attributable to relocation or sharing;
       ``(ii) the costs of all engineering, equipment, software, 
     site acquisition, and construction, as well as any legitimate 
     and prudent transaction expense, including term-limited 
     Federal civil servant and contractor staff necessary to carry 
     out the relocation or sharing activities of a Federal entity, 
     and reasonable additional costs incurred by the Federal 
     entity that are attributable to relocation or sharing, 
     including increased recurring costs associated with the 
     replacement of facilities;
       ``(iii) the costs of research, engineering studies, 
     economic analyses, or other expenses reasonably incurred in 
     connection with--

       ``(I) calculating the estimated relocation or sharing costs 
     that are provided to the Commission pursuant to paragraph 
     (4)(A);
       ``(II) determining the technical or operational feasibility 
     of relocation to 1 or more potential relocation bands; or
       ``(III) planning for or managing a relocation or sharing 
     arrangement (including spectrum coordination with auction 
     winners);

       ``(iv) the one-time costs of any modification of equipment 
     reasonably necessary--

       ``(I) to accommodate non-Federal use of shared frequencies; 
     or
       ``(II) in the case of eligible frequencies reallocated for 
     exclusive non-Federal use and assigned through a system of 
     competitive bidding under section 309(j) of the 
     Communications Act of 1934 (47 U.S.C. 309(j)) but with 
     respect to which a Federal entity retains primary allocation 
     or protected status for a period of time after the completion 
     of the competitive bidding process, to accommodate shared 
     Federal and non-Federal use of such frequencies for such 
     period; and

       ``(v) the costs associated with the accelerated replacement 
     of systems and equipment if the acceleration is necessary to 
     ensure the timely relocation of systems to a new frequency 
     assignment or the timely accommodation of sharing of Federal 
     frequencies.
       ``(B) Comparable capability of systems.--For purposes of 
     subparagraph (A), comparable capability of systems--
       ``(i) may be achieved by relocating a Federal Government 
     station to a new frequency assignment, by relocating a 
     Federal Government station to a different geographic 
     location, by modifying Federal Government equipment to 
     mitigate interference or use less spectrum, in terms of 
     bandwidth, geography, or time, and thereby permitting 
     spectrum sharing (including sharing among relocated Federal 
     entities and incumbents to make spectrum available for non-
     Federal use) or relocation, or by utilizing an alternative 
     technology; and
       ``(ii) includes the acquisition of state-of-the-art 
     replacement systems intended to meet comparable operational 
     scope, which may include incidental increases in 
     functionality.'';
       (E) in paragraph (4)--
       (i) in the heading, by striking ``relocations costs'' and 
     inserting ``relocation or sharing costs'';
       (ii) by striking ``relocation costs'' each place it appears 
     and inserting ``relocation or sharing costs''; and
       (iii) in subparagraph (A), by inserting ``or sharing'' 
     after ``such relocation'';
       (F) in paragraph (5)--
       (i) by striking ``relocation costs'' and inserting 
     ``relocation or sharing costs''; and
       (ii) by inserting ``or sharing'' after ``for relocation''; 
     and
       (G) by amending paragraph (6) to read as follows:
       ``(6) Implementation of procedures.--The NTIA shall take 
     such actions as necessary to ensure the timely relocation of 
     Federal entities' spectrum-related operations from 
     frequencies described in paragraph (2) to frequencies or 
     facilities of comparable capability and to ensure the timely 
     implementation of arrangements for the sharing of frequencies 
     described in such paragraph. Upon a finding by the NTIA that 
     a Federal entity has achieved comparable capability of 
     systems, the NTIA shall terminate or limit the entity's 
     authorization and notify the Commission that the entity's 
     relocation has been completed or sharing arrangement has been 
     implemented. The NTIA shall also terminate such entity's 
     authorization if the NTIA determines that the entity has 
     unreasonably failed to comply with the timeline for 
     relocation or sharing submitted by the Director of the Office 
     of Management and Budget under section 118(d)(2)(C).'';
       (2) by redesignating subsections (h) and (i) as subsections 
     (k) and (l), respectively; and
       (3) by inserting after subsection (g) the following:
       ``(h) Development and Publication of Relocation or Sharing 
     Transition Plans.--
       ``(1) Development of transition plan by federal entity.--
     Not later than 240 days before the commencement of any 
     auction of eligible frequencies described in subsection 
     (g)(2), a Federal entity authorized to use any such frequency 
     shall submit to the NTIA and to the Technical Panel 
     established by paragraph (3) a transition plan for the 
     implementation by such entity of the relocation or sharing 
     arrangement. The NTIA shall specify, after public input, a 
     common format for all Federal entities to follow in preparing 
     transition plans under this paragraph.
       ``(2) Contents of transition plan.--The transition plan 
     required by paragraph (1) shall include the following 
     information:
       ``(A) The use by the Federal entity of the eligible 
     frequencies to be auctioned, current as of the date of the 
     submission of the plan.
       ``(B) The geographic location of the facilities or systems 
     of the Federal entity that use such frequencies.
       ``(C) The frequency bands used by such facilities or 
     systems, described by geographic location.
       ``(D) The steps to be taken by the Federal entity to 
     relocate its spectrum use from such frequencies or to share 
     such frequencies, including timelines for specific geographic 
     locations in sufficient detail to indicate when use of such 
     frequencies at such locations will be discontinued by the 
     Federal entity or shared between the Federal entity and non-
     Federal users.
       ``(E) The specific interactions between the eligible 
     Federal entity and the NTIA needed to implement the 
     transition plan.
       ``(F) The name of the officer or employee of the Federal 
     entity who is responsible for the relocation or sharing 
     efforts of the entity and who is authorized to meet and 
     negotiate with non-Federal users regarding the transition.
       ``(G) The plans and timelines of the Federal entity for--
       ``(i) using funds received from the Spectrum Relocation 
     Fund established by section 118;
       ``(ii) procuring new equipment and additional personnel 
     needed for relocation or sharing;
       ``(iii) field-testing and deploying new equipment needed 
     for relocation or sharing; and

[[Page H860]]

       ``(iv) hiring and relying on contract personnel, if any, 
     needed for relocation or sharing.
       ``(H) Factors that could hinder fulfillment of the 
     transition plan by the Federal entity.
       ``(3) Technical panel.--
       ``(A) Establishment.--There is established within the NTIA 
     a panel to be known as the Technical Panel.
       ``(B) Membership.--
       ``(i) Number and appointment.--The Technical Panel shall be 
     composed of 3 members, to be appointed as follows:

       ``(I) One member to be appointed by the Director of the 
     Office of Management and Budget (in this subsection referred 
     to as `OMB').
       ``(II) One member to be appointed by the Assistant 
     Secretary.
       ``(III) One member to be appointed by the Chairman of the 
     Commission.

       ``(ii) Qualifications.--Each member of the Technical Panel 
     shall be a radio engineer or a technical expert.
       ``(iii) Initial appointment.--The initial members of the 
     Technical Panel shall be appointed not later than 180 days 
     after the date of the enactment of the Middle Class Tax 
     Relief and Job Creation Act of 2012.
       ``(iv) Terms.--The term of a member of the Technical Panel 
     shall be 18 months, and no individual may serve more than 1 
     consecutive term.
       ``(v) Vacancies.--Any member appointed to fill a vacancy 
     occurring before the expiration of the term for which the 
     member's predecessor was appointed shall be appointed only 
     for the remainder of that term. A member may serve after the 
     expiration of that member's term until a successor has taken 
     office. A vacancy shall be filled in the manner in which the 
     original appointment was made.
       ``(vi) No compensation.--The members of the Technical Panel 
     shall not receive any compensation for service on the 
     Technical Panel. If any such member is an employee of the 
     agency of the official that appointed such member to the 
     Technical Panel, compensation in the member's capacity as 
     such an employee shall not be considered compensation under 
     this clause.
       ``(C) Administrative support.--The NTIA shall provide the 
     Technical Panel with the administrative support services 
     necessary to carry out its duties under this subsection and 
     subsection (i).
       ``(D) Regulations.--Not later than 180 days after the date 
     of the enactment of the Middle Class Tax Relief and Job 
     Creation Act of 2012, the NTIA shall, after public notice and 
     comment and subject to approval by the Director of OMB, adopt 
     regulations to govern the workings of the Technical Panel.
       ``(E) Certain requirements inapplicable.--The Federal 
     Advisory Committee Act (5 U.S.C. App.) and sections 552 and 
     552b of title 5, United States Code, shall not apply to the 
     Technical Panel.
       ``(4) Review of plan by technical panel.--
       ``(A) In general.--Not later than 30 days after the 
     submission of the plan under paragraph (1), the Technical 
     Panel shall submit to the NTIA and to the Federal entity a 
     report on the sufficiency of the plan, including whether the 
     plan includes the information required by paragraph (2) and 
     an assessment of the reasonableness of the proposed timelines 
     and estimated relocation or sharing costs, including the 
     costs of any proposed expansion of the capabilities of a 
     Federal system in connection with relocation or sharing.
       ``(B) Insufficiency of plan.--If the Technical Panel finds 
     the plan insufficient, the Federal entity shall, not later 
     than 90 days after the submission of the report by the 
     Technical panel under subparagraph (A), submit to the 
     Technical Panel a revised plan. Such revised plan shall be 
     treated as a plan submitted under paragraph (1).
       ``(5) Publication of transition plan.--Not later than 120 
     days before the commencement of the auction described in 
     paragraph (1), the NTIA shall make the transition plan 
     publicly available on its website.
       ``(6) Updates of transition plan.--As the Federal entity 
     implements the transition plan, it shall periodically update 
     the plan to reflect any changed circumstances, including 
     changes in estimated relocation or sharing costs or the 
     timeline for relocation or sharing. The NTIA shall make the 
     updates available on its website.
       ``(7) Classified and other sensitive information.--
       ``(A) Classified information.--If any of the information 
     required to be included in the transition plan of a Federal 
     entity is classified information (as defined in section 
     798(b) of title 18, United States Code), the entity shall--
       ``(i) include in the plan--

       ``(I) an explanation of the exclusion of any such 
     information, which shall be as specific as possible; and
       ``(II) all relevant non-classified information that is 
     available; and

       ``(ii) discuss as a factor under paragraph (2)(H) the 
     extent of the classified information and the effect of such 
     information on the implementation of the relocation or 
     sharing arrangement.
       ``(B) Regulations.--Not later than 180 days after the date 
     of the enactment of the Middle Class Tax Relief and Job 
     Creation Act of 2012, the NTIA, in consultation with the 
     Director of OMB and the Secretary of Defense, shall adopt 
     regulations to ensure that the information publicly released 
     under paragraph (5) or (6) does not contain classified 
     information or other sensitive information.
       ``(i) Dispute Resolution Process.--
       ``(1) In general.--If a dispute arises between a Federal 
     entity and a non-Federal user regarding the execution, 
     timing, or cost of the transition plan submitted by the 
     Federal entity under subsection (h)(1), the Federal entity or 
     the non-Federal user may request that the NTIA establish a 
     dispute resolution board to resolve the dispute.
       ``(2) Establishment of board.--
       ``(A) In general.--If the NTIA receives a request under 
     paragraph (1), it shall establish a dispute resolution board.
       ``(B) Membership and appointment.--The dispute resolution 
     board shall be composed of 3 members, as follows:
       ``(i) A representative of the Office of Management and 
     Budget (in this subsection referred to as `OMB'), to be 
     appointed by the Director of OMB.
       ``(ii) A representative of the NTIA, to be appointed by the 
     Assistant Secretary.
       ``(iii) A representative of the Commission, to be appointed 
     by the Chairman of the Commission.
       ``(C) Chair.--The representative of OMB shall be the Chair 
     of the dispute resolution board.
       ``(D) Vacancies.--Any vacancy in the dispute resolution 
     board shall be filled in the manner in which the original 
     appointment was made.
       ``(E) No compensation.--The members of the dispute 
     resolution board shall not receive any compensation for 
     service on the board. If any such member is an employee of 
     the agency of the official that appointed such member to the 
     board, compensation in the member's capacity as such an 
     employee shall not be considered compensation under this 
     subparagraph.
       ``(F) Termination of board.--The dispute resolution board 
     shall be terminated after it rules on the dispute that it was 
     established to resolve and the time for appeal of its 
     decision under paragraph (7) has expired, unless an appeal 
     has been taken under such paragraph. If such an appeal has 
     been taken, the board shall continue to exist until the 
     appeal process has been exhausted and the board has completed 
     any action required by a court hearing the appeal.
       ``(3) Procedures.--The dispute resolution board shall meet 
     simultaneously with representatives of the Federal entity and 
     the non-Federal user to discuss the dispute. The dispute 
     resolution board may require the parties to make written 
     submissions to it.
       ``(4) Deadline for decision.--The dispute resolution board 
     shall rule on the dispute not later than 30 days after the 
     request was made to the NTIA under paragraph (1).
       ``(5) Assistance from technical panel.--The Technical Panel 
     established under subsection (h)(3) shall provide the dispute 
     resolution board with such technical assistance as the board 
     requests.
       ``(6) Administrative support.--The NTIA shall provide the 
     dispute resolution board with the administrative support 
     services necessary to carry out its duties under this 
     subsection.
       ``(7) Appeals.--A decision of the dispute resolution board 
     may be appealed to the United States Court of Appeals for the 
     District of Columbia Circuit by filing a notice of appeal 
     with that court not later than 30 days after the date of such 
     decision. Each party shall bear its own costs and expenses, 
     including attorneys' fees, for any appeal under this 
     paragraph.
       ``(8) Regulations.--Not later than 180 days after the date 
     of the enactment of the Middle Class Tax Relief and Job 
     Creation Act of 2012, the NTIA shall, after public notice and 
     comment and subject to approval by OMB, adopt regulations to 
     govern the working of any dispute resolution boards 
     established under paragraph (2)(A) and the role of the 
     Technical Panel in assisting any such board.
       ``(9) Certain requirements inapplicable.--The Federal 
     Advisory Committee Act (5 U.S.C. App.) and sections 552 and 
     552b of title 5, United States Code, shall not apply to a 
     dispute resolution board established under paragraph (2)(A).
       ``(j) Relocation Prioritized Over Sharing.--
       ``(1) In general.--In evaluating a band of frequencies for 
     possible reallocation for exclusive non-Federal use or shared 
     use, the NTIA shall give priority to options involving 
     reallocation of the band for exclusive non-Federal use and 
     shall choose options involving shared use only when it 
     determines, in consultation with the Director of the Office 
     of Management and Budget, that relocation of a Federal entity 
     from the band is not feasible because of technical or cost 
     constraints.
       ``(2) Notification of congress when sharing chosen.--If the 
     NTIA determines under paragraph (1) that relocation of a 
     Federal entity from the band is not feasible, the NTIA shall 
     notify the Committee on Commerce, Science, and Transportation 
     of the Senate and the Committee on Energy and Commerce of the 
     House of Representatives of the determination, including the 
     specific technical or cost constraints on which the 
     determination is based.''.
       (b) Conforming Amendment.--Section 309(j) of the 
     Communications Act of 1934 is further amended by striking 
     ``relocation costs'' each place it appears and inserting 
     ``relocation or sharing costs''.

     SEC. 6702. SPECTRUM RELOCATION FUND.

       Section 118 of the National Telecommunications and 
     Information Administration Organization Act (47 U.S.C. 928) 
     is amended--

[[Page H861]]

       (1) by striking ``relocation costs'' each place it appears 
     and inserting ``relocation or sharing costs'';
       (2) by amending subsection (c) to read as follows:
       ``(c) Use of Funds.--The amounts in the Fund from auctions 
     of eligible frequencies are authorized to be used to pay 
     relocation or sharing costs of an eligible Federal entity 
     incurring such costs with respect to relocation from or 
     sharing of those frequencies.'';
       (3) in subsection (d)--
       (A) in paragraph (2)--
       (i) in subparagraph (A), by inserting ``or sharing'' before 
     the semicolon;
       (ii) in subparagraph (B), by inserting ``or sharing'' 
     before the period at the end;
       (iii) by redesignating subparagraphs (A) and (B) as 
     subparagraphs (B) and (C), respectively; and
       (iv) by inserting before subparagraph (B), as so 
     redesignated, the following:
       ``(A) unless the eligible Federal entity has submitted a 
     transition plan to the NTIA as required by paragraph (1) of 
     section 113(h), the Technical Panel has found such plan 
     sufficient under paragraph (4) of such section, and the NTIA 
     has made available such plan on its website as required by 
     paragraph (5) of such section;'';
       (B) by striking paragraph (3); and
       (C) by adding at the end the following:
       ``(3) Transfers for pre-auction costs.--
       ``(A) In general.--Subject to subparagraph (B), the 
     Director of OMB may transfer to an eligible Federal entity, 
     at any time (including prior to a scheduled auction), such 
     sums as may be available in the Fund to pay relocation or 
     sharing costs related to pre-auction estimates or research, 
     as such costs are described in section 113(g)(3)(A)(iii).
       ``(B) Notification.--No funds may be transferred pursuant 
     to subparagraph (A) unless--
       ``(i) the notification provided under paragraph (2)(C) 
     includes a certification from the Director of OMB that--

       ``(I) funds transferred before an auction will likely allow 
     for timely implementation of relocation or sharing, thereby 
     increasing net expected auction proceeds by an amount not 
     less than the time value of the amount of funds transferred; 
     and
       ``(II) the auction is intended to occur not later than 5 
     years after transfer of funds; and

       ``(ii) the transition plan submitted by the eligible 
     Federal entity under section 113(h)(1) provides--

       ``(I) to the fullest extent possible, for sharing and 
     coordination of eligible frequencies with non-Federal users, 
     including reasonable accommodation by the eligible Federal 
     entity for the use of eligible frequencies by non-Federal 
     users during the period that the entity is relocating its 
     spectrum uses (in this clause referred to as the `transition 
     period');
       ``(II) for non-Federal users to be able to use eligible 
     frequencies during the transition period in geographic areas 
     where the eligible Federal entity does not use such 
     frequencies;
       ``(III) that the eligible Federal entity will, during the 
     transition period, make itself available for negotiation and 
     discussion with non-Federal users not later than 30 days 
     after a written request therefor; and
       ``(IV) that the eligible Federal entity will, during the 
     transition period, make available to a non-Federal user with 
     appropriate security clearances any classified information 
     (as defined in section 798(b) of title 18, United States 
     Code) regarding the relocation process, on a need-to-know 
     basis, to assist the non-Federal user in the relocation 
     process with such eligible Federal entity or other eligible 
     Federal entities.

       ``(C) Applicability to certain costs.--
       ``(i) In general.--The Director of OMB may transfer under 
     subparagraph (A) not more than $10,000,000 for costs incurred 
     after June 28, 2010, but before the date of the enactment of 
     the Middle Class Tax Relief and Job Creation Act of 2012.
       ``(ii) Supplement not supplant.--Any amounts transferred by 
     the Director of OMB pursuant to clause (i) shall be in 
     addition to any amounts that the Director of OMB may transfer 
     for costs incurred on or after the date of the enactment of 
     the Middle Class Tax Relief and Job Creation Act of 2012.
       ``(4) Reversion of unused funds.--Any amounts in the Fund 
     that are remaining after the payment of the relocation or 
     sharing costs that are payable from the Fund shall revert to 
     and be deposited in the general fund of the Treasury, for the 
     sole purpose of deficit reduction, not later than 8 years 
     after the date of the deposit of such proceeds to the Fund, 
     unless within 60 days in advance of the reversion of such 
     funds, the Director of OMB, in consultation with the NTIA, 
     notifies the congressional committees described in paragraph 
     (2)(C) that such funds are needed to complete or to implement 
     current or future relocation or sharing arrangements.'';
       (4) in subsection (e)--
       (A) in paragraph (1)(B)--
       (i) in clause (i), by striking ``subsection (d)(2)(A)'' and 
     inserting ``subsection (d)(2)(B)''; and
       (ii) in clause (ii), by striking ``subsection (d)(2)(B)'' 
     and inserting ``subsection (d)(2)(C)''; and
       (B) in paragraph (2)--
       (i) by striking ``entity's relocation'' and inserting 
     ``relocation of the entity or implementation of the sharing 
     arrangement by the entity'';
       (ii) by inserting ``or the implementation of such 
     arrangement'' after ``such relocation''; and
       (iii) by striking ``subsection (d)(2)(A)'' and inserting 
     ``subsection (d)(2)(B)''; and
       (5) by adding at the end the following:
       ``(f) Additional Payments From Fund.--
       ``(1) Amounts available.--Notwithstanding subsections (c) 
     through (e), after the date of the enactment of the Middle 
     Class Tax Relief and Job Creation Act of 2012, there are 
     appropriated from the Fund and available to the Director of 
     OMB for use in accordance with paragraph (2) not more than 10 
     percent of the amounts deposited in the Fund from auctions 
     occurring after such date of enactment of licenses for the 
     use of spectrum vacated by eligible Federal entities.
       ``(2) Use of amounts.--
       ``(A) In general.--The Director of OMB, in consultation 
     with the NTIA, may use amounts made available under paragraph 
     (1) to make payments to eligible Federal entities that are 
     implementing a transition plan submitted under section 
     113(h)(1) in order to encourage such entities to complete the 
     implementation more quickly, thereby encouraging timely 
     access to the eligible frequencies that are being reallocated 
     for exclusive non-Federal use or shared use.
       ``(B) Conditions.--In the case of any payment by the 
     Director of OMB under subparagraph (A)--
       ``(i) such payment shall be based on the market value of 
     the eligible frequencies, the timeliness with which the 
     eligible Federal entity clears its use of such frequencies, 
     and the need for such frequencies in order for the entity to 
     conduct its essential missions;
       ``(ii) the eligible Federal entity shall use such payment 
     for the purposes specified in clauses (i) through (v) of 
     section 113(g)(3)(A) to achieve comparable capability of 
     systems affected by the reallocation of eligible frequencies 
     from Federal use to exclusive non-Federal use or to shared 
     use;
       ``(iii) such payment may not be made if the amount 
     remaining in the Fund after such payment will be less than 10 
     percent of the winning bids in the auction of the spectrum 
     with respect to which the Federal entity is incurring 
     relocation or sharing costs; and
       ``(iv) such payment may not be made until 30 days after the 
     Director of OMB has notified the congressional committees 
     described in subsection (d)(2)(C).
       ``(g) Restriction on Use of Funds.--No amounts in the Fund 
     on the day before the date of the enactment of the Middle 
     Class Tax Relief and Job Creation Act of 2012 may be used for 
     any purpose except--
       ``(1) to pay the relocation or sharing costs incurred by 
     eligible Federal entities in order to relocate from the 
     frequencies the auction of which generated such amounts; or
       ``(2) to pay relocation or sharing costs related to pre-
     auction estimates or research, in accordance with subsection 
     (d)(3).''.

     SEC. 6703. NATIONAL SECURITY AND OTHER SENSITIVE INFORMATION.

       Part B of title I of the National Telecommunications and 
     Information Administration Organization Act (47 U.S.C. 921 et 
     seq.) is amended by adding at the end the following:

     ``SEC. 119. NATIONAL SECURITY AND OTHER SENSITIVE 
                   INFORMATION.

       ``(a) Determination.--If the head of an Executive agency 
     (as defined in section 105 of title 5, United States Code) 
     determines that public disclosure of any information 
     contained in a notification or report required by section 113 
     or 118 would reveal classified national security information, 
     or other information for which there is a legal basis for 
     nondisclosure and the public disclosure of which would be 
     detrimental to national security, homeland security, or 
     public safety or would jeopardize a law enforcement 
     investigation, the head of the Executive agency shall notify 
     the Assistant Secretary of that determination prior to the 
     release of such information.
       ``(b) Inclusion in Annex.--The head of the Executive agency 
     shall place the information with respect to which a 
     determination was made under subsection (a) in a separate 
     annex to the notification or report required by section 113 
     or 118. The annex shall be provided to the subcommittee of 
     primary jurisdiction of the congressional committee of 
     primary jurisdiction in accordance with appropriate national 
     security stipulations but shall not be disclosed to the 
     public or provided to any unauthorized person through any 
     means.''.

                  TITLE VII--MISCELLANEOUS PROVISIONS

     SEC. 7001. REPEAL OF CERTAIN SHIFTS IN THE TIMING OF 
                   CORPORATE ESTIMATED TAX PAYMENTS.

       The following provisions of law (and any modification of 
     any such provision which is contained in any other provision 
     of law) shall not apply with respect to any installment of 
     corporate estimated tax:
       (1) Section 201(b) of the Corporate Estimated Tax Shift Act 
     of 2009.
       (2) Section 561 of the Hiring Incentives to Restore 
     Employment Act.
       (3) Section 505 of the United States-Korea Free Trade 
     Agreement Implementation Act.
       (4) Section 603 of the United States-Colombia Trade 
     Promotion Agreement Implementation Act.
       (5) Section 502 of the United State-Panama Trade Promotion 
     Agreement Implementation Act.

     SEC. 7002. REPEAL OF REQUIREMENT RELATING TO TIME FOR 
                   REMITTING CERTAIN MERCHANDISE PROCESSING FEES.

       (a) Repeal.--The Trade Adjustment Assistance Extension Act 
     of 2011 (title II of Public Law 112 40; 125 Stat. 402) is 
     amended by striking section 263.

[[Page H862]]

       (b) Clerical Amendment.--The table of contents for such Act 
     is amended by striking the item relating to section 263.

     SEC. 7003. TREATMENT FOR PAYGO PURPOSES.

       The budgetary effects of this Act shall not be entered on 
     either PAYGO scorecard maintained pursuant to section 4(d) of 
     the Statutory Pay-As-You-Go Act of 2010.

       And the Senate agree to the same.
       That the Senate recede from its amendment to the title of 
     the bill.
     Dave Camp,
     Fred Upton,
     Kevin Brady,
     Greg Walden,
     Tom Price,
     Tom Reed,
     Renee L. Ellmers,
     Nan A.S. Hayworth,
     Sander M. Levin,
     Xavier Becerra,
     Chris Van Hollen,
     Allyson Y. Schwartz,
     Henry A. Waxman,
                                Managers on the Part of the House.

     Max Baucus,
     Jack Reed,
     Benjamin L. Cardin,
     Robert P. Casey, Jr.,
                               Managers on the Part of the Senate.

       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

       The managers on the part of the House and the Senate at the 
     conference on the disagreeing votes of the two Houses on the 
     amendments of the Senate to the bill (H.R. 3630), to provide 
     incentives for the creation of jobs, and for other purposes, 
     submit the following joint statement to the House and the 
     Senate in explanation of the effect of the action agreed upon 
     by the managers and recommended in the accompanying 
     conference report:
       The Senate amendment struck all of the House bill after the 
     enacting clause and inserted a substitute text.
       The House recedes from its disagreement to the amendment of 
     the Senate to the text with an amendment that is a substitute 
     for the House bill and the Senate amendment. The Senate 
     recedes from its amendment to the title. The committee of the 
     conference met on February 16, 2012 (the House chairing) and 
     resolved their differences. The differences between the House 
     bill, the Senate amendment, and the substitute agreed to in 
     conference are noted below, except for clerical corrections, 
     conforming changes made necessary by agreements reached by 
     the conferees, and minor drafting and clarifying changes.

                                 TITLE

     House bill
       ``Middle Class Tax Relief and Job Creation Act of 2011''
     Senate bill
       ``Temporary Payroll Tax Cut Continuation Act of 2011''
     Conference substitute
       ``Middle Class Tax Relief and Job Creation Act of 2012''

                    TITLE I--JOB CREATION INCENTIVES

                   Subtitle B--EPA Regulatory Relief

     H1102,1103,1104,1105/S--

     Current law
       Section 112 of the Clean Air Act (42 U.S.C. 7412) requires 
     the Environmental Protection Agency (EPA) to promulgate 
     Maximum Achievable Control Technology (MACT) standards for 
     ``major'' sources of emissions of 187 hazardous air 
     pollutants (HAPs) and Generally Available Control Technology 
     (GACT) standards for smaller (``area'') sources of HAP 
     emissions. Section 129 of the act (42 U.S.C. 7429) requires 
     EPA to promulgate MACT standards for solid waste combustion 
     units. Under the act, existing boilers would be required to 
     comply with the applicable emission standards within 3 years 
     of the effective date of promulgated regulations, with a 
     possibility of a one-year extension for individual sources if 
     necessary for the installation of controls. Existing solid 
     waste incinerators would be required to meet the standards no 
     later than 5 years after promulgation. On March 21, 2011, EPA 
     finalized four related rules applicable to boilers and 
     commercial and industrial solid waste incinerator (CISWI) 
     units. Three rules established applicable MACT and GACT 
     standards for boilers and MACT standards for CISWI units. The 
     fourth rule (established under authority of the Resource 
     Conservation and Recovery Act) clarified when materials used 
     as fuel in a combustion unit would be defined as ``solid 
     waste'' (a definition necessary to determine whether a 
     combustion unit would be subject to the CISWI standards 
     rather than the less stringent standards for boilers). EPA 
     stayed the effective date of its major sources and CISWI 
     emission standards pending reconsideration. EPA expects to 
     complete the reconsideration by April 2012. On January 9, 
     2012, a district court vacated EPA's stay of the major 
     sources and CISWI rules.
     House bill
       Sections 1102 1105 apply to EPA's four March 2011 rules. 
     Each rule would be revoked and EPA required to promulgate new 
     standards 15 months after the date of enactment (Section 
     1102). In establishing the relevant emission standards, the 
     Administrator would be required to choose the ``least 
     burdensome'' regulatory alternatives. Further, EPA would be 
     required to establish standards that can be met under actual 
     operating conditions consistently and concurrently with other 
     standards (Section 1105). The compliance date for the air 
     emission standards would be no earlier than 5 years after the 
     date of the new regulation and could take feasibility, cost, 
     and other factors into account in setting the compliance date 
     (Section 1103). In promulgating new rules defining materials 
     that are solid waste when used as a fuel, EPA would be 
     required to adopt the definition of terms promulgated by the 
     agency in a December 2000 CISWI rule (Section 1104).
     Senate bill
       No provision.
     Conference substitute
       No provision.

TITLE II--EXTENSION OF CERTAIN EXPIRING PROVISIONS AND RELATED MEASURES

                 Subtitle B--Unemployment Compensation


 PART 1--REFORMS OF UNEMPLOYMENT COMPENSATION TO PROMOTE WORK AND JOB 
                                CREATION

     H2121,2122,2123,2124,2125,2126,2127/S--

     Current law
       Federal unemployment law does not contain explicit job 
     search requirements for the receipt of regular state 
     unemployment compensation (UC). Through interpretation of the 
     framework of the Federal unemployment laws contained within 
     the Social Security Act (SSA) and in the Federal Unemployment 
     Tax Act (FUTA), it is generally understood that workers must 
     have lost their jobs through no fault of their own and must 
     be able, available, and willing to work. Variations exist in 
     state law requirements concerning ability and availability to 
     work. All states have work search requirements in state law 
     or regulation in order for an individual to receive regular 
     UC benefits. Most state laws require evidence of ability to 
     work through the filing of claims and registration for work 
     at a public employment office. Availability for work is often 
     translated to mean being ready, willing, and able to work. 
     Meeting the requirement of registration for work at a public 
     employment office may be considered as evidence of 
     availability in some states. There are often particular 
     requirements and/or exceptions for those workers on temporary 
     layoff and for workers that find employment through union 
     hiring halls. Section 202(c)(A)(ii) of the Federal-State 
     Extended Unemployment Compensation Act of 1970 (P.L. 97 373), 
     as amended, does explicitly require active job search. 
     However, the method of determining active job search is left 
     to the determination of the States.
       Federal law does not require minimum educational standards 
     as a condition of benefit receipt. Section 303(a)(10) of the 
     SSA requires any claimant who has been referred to 
     reemployment services pursuant to the profiling system under 
     Section 303(j)(1)(B) to participate in such services or in 
     similar services unless the state agency charged with the 
     administration of the state law determines (1) such claimant 
     has completed such services; or (2) there is justifiable 
     cause for such claimant's failure to participate in such 
     services. Section 303(j) requires the state use a system of 
     profiling all new claimants for regular compensation. The 
     profiling system must: (1) identify which claimants will be 
     likely to exhaust regular compensation and will need job 
     search assistance services to make a successful transition to 
     new employment; and (2) refer the identified claimants to 
     reemployment services (including job search assistance 
     services) that are available under any state or Federal law. 
     Section 3304(a)(8) of the Internal Revenue Code (IRC) 
     requires, as a condition for employers in a state to receive 
     normal credit against the Federal tax, that a state's 
     unemployment benefits laws provide that compensation shall 
     not be denied to an individual for any week because he is in 
     training with the approval of the state agency (or because of 
     the application, to any such week in training, of state law 
     provisions relating to availability for work, active search 
     for work, or refusal to accept work). A recent Training and 
     Employment Guidance Letter (TEGL) No. 21 08, among other 
     items, strongly encouraged states to broaden their definition 
     of approved training for UC beneficiaries during economic 
     downturns.
       Section 3304(a)(4) of the IRC and Section 303(a)(5) of the 
     SSA set the withdrawal standards for States to use funds 
     within the State account in the Unemployment Trust Fund 
     (UTF). All funds withdrawn from the unemployment fund of the 
     state shall be used solely in the payment of unemployment 
     compensation, exclusive of expenses of administration. Few 
     exceptions exist; these include, for instance, withholding 
     for tax purposes, for child support payments, to repay UI 
     overpayments or covered unemployment compensation debt, and 
     for benefits for the Self-Employment Assistance program and 
     the Short-Time Compensation program. Section 303(a)(1) 
     requires that the state UC program personnel be merit 
     employees.
       Section 3306(t) of the Federal Unemployment Tax Act (FUTA) 
     defines the Self-Employment Assistance (SEA) program. Section 
     303(a)(5) of the Social Security Act permits the use of 
     expenditures from the Unemployment Trust Fund (UTF) for SEA. 
     The regular UC program generally requires unemployed workers 
     to be actively seeking work and to be available for wage and 
     salary jobs as a condition of eligibility for UC benefits. In 
     states that have opted to create SEA programs under current 
     law, SEA provides allowances in the same amount as regular UC

[[Page H863]]

     benefits to individuals who (1) would otherwise be eligible 
     for regular UC and (2) have been identified as likely to 
     exhaust regular UC benefits. Under SEA a participating 
     individual is not subject to worker search requirements so 
     long as the individual is participating in entrepreneurial 
     training or other activities.
       Section 303(g)(1) of the Social Security Act and Section 
     3304(a)(4)(D) of the Internal Revenue Code (IRC) allow states 
     but do not require states to offset UC payments by non-fraud 
     overpayments. States may opt in state law to waive deductions 
     if it would be contrary to equity and good conscience.
       There are no specific federal laws or regulations related 
     to uniform data elements for improved data matching in the 
     Federal-state unemployment compensation program. Section 
     303(a)(6) of the SSA requires states to make reports of 
     information and data as required by the U.S. Labor Secretary. 
     But current Federal law contains no precise requirements 
     regarding codes or identifiers attached to UC, Emergency 
     Unemployment Compensation (EUC08), or Extended Benefit (EB) 
     program data or any other data standards.
       Federal law does not specifically authorize drug testing of 
     applicants as a condition of UC benefit eligibility. No state 
     currently requires drug tests as a condition of eligibility 
     for unemployment benefits. There are states that do, however, 
     have state law provisions related to disqualification for 
     previously failed drug tests/use of illegal drugs during 
     prior employment.
     House bill
       Section 2121 would add new federal law requirements for 
     state UC eligibility related to being ``able, available, and 
     actively seeking work''--with the latter specifically defined 
     under federal law, including at least (1) registering for 
     employment services within 10 days after initial filing for 
     UC benefits; (2) posting a resume, record, or other 
     application for employment through a state agency database; 
     and (3) applying for work under state requirements [effective 
     for weeks beginning after end of first state legislative 
     session after enactment]. No new funds would be provided for 
     such activities. There would be no exceptions for those on 
     temporary lay-off with expectation of recall, union members, 
     or for those who are striking.
       Section 2122 would add new federal law requirements for 
     state UC eligibility: (1) UC claimants must meet minimum 
     education requirements: either earn HS diploma, attain GED, 
     or enroll/make satisfactory progress in classes leading to HS 
     diploma or GED (states would be allowed to waive this 
     educational requirement if state law deems it unduly 
     burdensome); and (2) UC claimants referred to reemployment 
     services must participate. Additionally, the proposal would 
     add a new federal law provision to stipulate that UC may not 
     be denied to an individual enrolled/making satisfactory 
     progress in education or state-approved job training 
     [effective for weeks beginning after end of first state 
     legislative session after enactment].
       Section 2123 would authorize under federal law up to 10 
     state UC demonstration projects a year (lasting up to 3 
     years). Demonstration projects would test and evaluate 
     measures designed to expedite the reemployment of individuals 
     who establish initial eligibility for regular UC or to 
     improve the effectiveness of state reemployment efforts. 
     States would provide a general description of the proposed 
     demonstration project. The description would include: (1) a 
     description of the proposed project, its authority under 
     State law, and the period during which the project would be 
     conducted; (2) the specifics of any waiver to Federal law and 
     the reason for such waiver; (3) a description of the goals 
     and expected outcomes of the project; (4) assurances and 
     supporting analysis that the project would not result in a 
     net increase cost to the state's Unemployment Trust Fund 
     (UTF); (5) a description of the impact evaluation; and (6) 
     assurances of reports required by the U.S. Labor Secretary. 
     Section 2123 would allow the U.S. Labor Secretary to waive 
     the withdrawal standard and/or merit employee requirements if 
     requested by the state (state UTF funds would be allowed to 
     be used for purposes other than paying unemployment 
     benefits). Authority ends 5 years after date of enactment of 
     the section. Administrative grants to the states for 
     administration of the regular UC program may be used for an 
     approved project.
       Section 2124 would require the U.S. Department of Labor 
     (U.S. DOL) to develop and maintain model language for states 
     to use in enacting SEA programs for regular UC claimants (as 
     authorized under current federal law); this model language 
     would be developed through U.S. DOL consultation with 
     employers, labor organizations, state UC agencies, and other 
     relevant program experts; would require U.S. DOL to provide 
     technical assistance and guidance to states in enacting, 
     improving, and administering SEA programs; would require U.S. 
     DOL to establish reporting requirements for state SEA 
     programs, including reporting (1) on the number of jobs and 
     businesses created by SEA programs and (2) the federal and 
     state tax revenues collected from such businesses and their 
     employees; and would require U.S. DOL to coordinate with the 
     Small Business Administration to ensure adequate funding for 
     the entrepreneurial training of SEA participants in states 
     with SEA programs.
       Section 2125 would require states to recover 100% of any 
     erroneous overpayment by reducing up to 100% of the UC 
     benefit in each week until the overpayment is fully 
     recovered. The proposal would not allow states to waive such 
     deduction if it would be contrary to equity and good 
     conscience. Section 2125 also would create authority for 
     states to recover Federal Additional Compensation (FAC) 
     overpayments through deductions to regular unemployment 
     compensation.
       Section 2126 would require that the U.S. Labor Secretary 
     designate standard data elements for any information required 
     under title III or title IX of the SSA. This section would 
     require the standard data elements incorporate interoperable 
     standards that have been developed and used by an 
     international standards body (as established by the Office of 
     Management and Budget (OMB) and the U.S. Labor Secretary); 
     intergovernmental partnerships; and Federal entities with 
     contracting and financial assistance authority. In addition, 
     Section 106(a) of this proposal would require the U.S. Labor 
     Secretary, in consultation with an OMB interagency working 
     group and States, to designate standard data elements that, 
     to the extent practicable: (1) Make use of a widely-accepted, 
     non-proprietary, digital, searchable format (2) Are 
     consistent with and use relevant accounting principles (3) 
     Are able to be upgraded on a continual basis (4) Incorporate 
     non-proprietary standards (such as the eXtensible Business 
     Reporting Language).
       Section 2127 would clarify federal law to allow (but would 
     not require) drug testing of UC applicants.
     Senate bill
       No provision.
     Conference substitute
       The conference agreement follows the House bill with regard 
     to specifying new federal minimum standards for state 
     unemployment compensation eligibility related to being 
     ``able, available, and actively seek work.'' (See also part 3 
     of this section with regard to job search requirements 
     related to Federal unemployment benefits.)
       The conference agreement follows the House bill with regard 
     to State flexibility (i.e. new waiver authority), but with 
     the following modifications:
       (1) Permits a total of no more than 10 States to receive 
     waivers;
       (2) Specifies that waivers may only be used to operate 
     programs providing subsidies for employer-provided training 
     or for direct disbursements (such as wage subsidies) to 
     employers who hire individuals receiving UC benefits, not to 
     exceed the weekly benefit amount, to cover part of the cost 
     of their wages, and provided that the overall wage is greater 
     than the unemployment benefit the individual had been 
     receiving;
       (3) Limits the operation of State waiver programs to no 
     more than 3 years, and specifies that the waiver programs 
     cannot be extended;
       (4) Requires the state to evaluate their waiver programs; 
     and
       (5) Requires States to provide assurances that any 
     employment meets the State's suitable work requirement and 
     requirements of section 3304(a)(5) of the Internal Revenue 
     Code and that the waiver programs end by December 31, 2015.
       The conference agreement follows the House bill and 
     incorporates S. 1826 with regard to the Self-Employment 
     Assistance Program, while also authorizing States to operate 
     SEA programs to assist individuals eligible for benefits 
     under the Emergency Unemployment Compensation (EUC) and 
     Extended Benefit (EB) programs, and providing funds to assist 
     States with the administration of such programs.
       The conference agreement includes a new provision based on 
     S. 1333 authorizing work sharing programs and providing 
     program and administrative funding for that purpose.
       The conference agreement follows the House bill with regard 
     to requiring States to offset current State benefits to 
     recover prior overpayments of State, other States', or 
     Federal unemployment benefits. With regard to efforts to 
     recover overpayments owed to other States and the Federal 
     government, the conference agreement requires each State to 
     apply hardship exceptions and related terms that follow State 
     practice used to recover overpayments of its own State 
     benefit funds.
       The conference agreement follows the House bill with regard 
     to the data standardization provisions.
       The conference agreement follows the House bill with regard 
     to drug testing provisions, with the modification that drug 
     screening and testing is permitted in any State, but only in 
     cases in which the individual applying for unemployment 
     benefits either (1) was terminated from their prior 
     employment because of unlawful drug use (2) is applying for 
     work for which passing a drug test is a standard eligibility 
     requirement.


            PART 2--PROVISIONS RELATING TO EXTENDED BENEFITS

     H2142,2143,2144/S201,202

     Current law
       Under P.L. 110 252, as amended, the authorization of the 
     EUC08 program expires the week ending on or before March 6, 
     2012. Individuals receiving benefits in any tier of EUC08 
     would be able to finish out that tier of benefits only 
     (grandfathering for current tier only). No EUC08 benefits--
     regardless of tier--are payable for any week after August 15, 
     2012. The current structure of unemployment benefits 
     available through the EUC08 program is: Tier I: up to 20 
     weeks of unemployment benefits (available in all states);

[[Page H864]]

     Tier II: up to 14 weeks (available in all states); Tier III: 
     up to 13 weeks (available in states with a total unemployment 
     rate (TUR) of at least 6% or an insured unemployment rate 
     (IUR) of at least 4%); Tier IV: up to 6 weeks (available in 
     states with a TUR of at least 8.5% or an IUR of at least 6%). 
     Section 4001(e) of P.L. 110 252, as amended allows states the 
     option to pay EUC08 before EB.
       Under permanent law (P.L. 97 373), EB benefits are financed 
     50% by the federal government (through federal unemployment 
     taxes; i.e., FUTA) and states fund the other half (50%) of EB 
     benefit costs through their state unemployment taxes (SUTA). 
     ARRA (P.L. 111 5, as amended) temporarily changed the 
     federal-state funding arrangement for the EB program. 
     Currently, the FUTA finances 100% of sharable EB benefits 
     through March 7, 2012. P.L. 111 312 made some temporary 
     technical changes to certain triggers in the EB program, 
     which allow states to temporarily use lookback calculations 
     based on three years of unemployment rate data (rather than 
     the permanent law lookback of two years of data) as part of 
     their EB triggers if states would otherwise trigger off or 
     not be on a period of EB benefits. This temporary option to 
     use three-year EB trigger lookback expires the week ending on 
     or before February 29, 2012.
       P.L. 111 5, as amended, temporarily increased the duration 
     of extended unemployment benefits for railroad workers. 
     Railroad workers who previously were not eligible for 
     extended unemployment benefits because they did not have 10 
     years of service may be eligible for benefits of up to 65 
     days within an extended period consisting of seven 
     consecutive two-week registration periods. Railroad workers 
     who previously were eligible for extended unemployment 
     benefits of up to 65 days (because they had 10 years of 
     service) may now be eligible for benefits of up to 130 days 
     within an extended period consisting of 13 consecutive two-
     week registration periods. P.L. 111 312 extended the ARRA 
     provisions by one year to June 30, 2011. Under P.L. 111 312, 
     the special extended unemployment benefit period could begin 
     no later than December 31, 2011. P.L. 112 78 extended the 
     temporary extended railroad unemployment benefit 
     (authorized under ARRA (P.L. 111 5), as amended) for two 
     months through February 29, 2012, to be financed with 
     funds still available under P.L. 111 312.
     House bill
       Section 2142 would extend the authorization of Tiers I and 
     III of EUC08 until the week ending on or before January 31, 
     2013. The duration and conditions for availability of Tier II 
     would be altered. There would be no benefits payable after 
     that date. (There would be no grandfathering of benefits.) 
     Tier I would continue to offer up to 20 weeks in all states, 
     Tier II would offer up to 13 weeks (rather than 14) and would 
     be available in states with at least 6.0% TUR or an IUR of at 
     least 4% (rather than in all states). Tiers III and IV would 
     not be reauthorized. Note: Included in this subsection was an 
     intent to require states to pay EUC08 before any EB 
     entitlement. However, the version passed by the House would 
     require states to pay EB before EUC08 and will need 
     correction to reflect the intended ordering of benefits. (At 
     the time of House passage, the authorization for all EUC08 
     tiers would have expired on the week ending on or before 
     January 3, 2012 and no EUC08 benefit would have been payable 
     for any week after June 9, 2012.)
       Section 2143 would extend the 100% federal financing of EB 
     through January 31, 2013, as well as the option for states to 
     use three-year lookback in their EB triggers until the week 
     ending on or before January 31, 2013. (At the time of House 
     passage, the FUTA financed 100% of sharable EB benefits 
     through January 4, 2012 and the three-year lookback would 
     have expired on the week ending on or before December 31, 
     2011.)
       Section 2144 would extend the temporary extended railroad 
     unemployment benefit (authorized under ARRA (P.L. 111 5), as 
     amended) for 13 months through January 31, 2013, to be 
     financed with funds still available under P.L. 111 312. (At 
     the time of House passage, the special extended unemployment 
     benefit period could begin no later than December 31, 2011.)
     Senate bill
       Section 201 would extend the authorization for the EUC08 
     program (as structured under current law) until the week 
     ending on or before March 6, 2012. No EUC08 benefits--
     regardless of tier--would be payable for any week after 
     August 15, 2012. (At the time of Senate passage, the 
     authorization for all EUC08 tiers would have expired on the 
     week ending on or before January 3, 2012 and no EUC08 benefit 
     would have been payable for any week after June 9, 2012.) 
     This section would extend the 100% federal financing of EB 
     through March 7, 2012. This section would also extend the 
     option for states to use the three-year lookback in their EB 
     triggers until the week ending on or before February 29, 
     2012. (At the time of Senate passage, the FUTA financed 100% 
     of sharable EB benefits through January 4, 2012 and the 
     three-year lookback would have expired on the week ending on 
     or before December 31, 2011.)
       Section 202 would extend the temporary extended railroad 
     unemployment benefit (authorized under ARRA (P.L. 111 5), as 
     amended) for two months through February 29, 2012, to be 
     financed with funds still available under P.L. 111 312. (At 
     the time of Senate passage, the special extended unemployment 
     benefit period could begin no later than December 31, 2011.)
     Conference substitute
       The conference agreement follows the House bill in 
     continuing the operation of the Federal Emergency 
     Unemployment Compensation (EUC) program beyond its current 
     expiration at the end of February 2012, with the following 
     modifications:
       (1) The authorization of the EUC program is extended 
     through the end of December 2012;
       (2) The EUC program will not continue to provide benefits 
     after December 2012 (i.e. there will be no ``phase-out'' of 
     benefits beyond December 2012);
       (3) EUC benefits would continue to be payable in up to four 
     tiers as under current law. However, as the table below 
     reflects, in the case of tiers two through four, higher total 
     unemployment rate (TUR) ``triggers'' will apply from June 
     through December 2012, as follows:

------------------------------------------------------------------------
            March through May   June through August   September through
 EUC Tier          2012                 2012            December 2012
------------------------------------------------------------------------
1........  20 weeks in all      20 weeks in all      14 weeks in all
            states.              states.              states
2........  14 weeks in all      14 weeks in 6% or    14 weeks in 6% or
            states.              higher states.       higher states
3........   13 weeks in 6% or   13 weeks in 7% or    9 weeks in 7% or
            higher states.       higher states.       higher states
4........  6 weeks in 8.5% or   6 weeks in 9% or     10 weeks in 9% or
            higher states (16    higher states.       higher states
            weeks if not on
            EB).
------------------------------------------------------------------------

       (4) Through May 2012 only, individuals who have not already 
     received up to 20 weeks of EB program benefits due to the 
     application of that program's ``3-year lookback'' would be 
     eligible to receive up to an additional 10 weeks of benefits 
     under Tier 4 of the EUC program (that is, in addition to the 
     six weeks otherwise available), provided they are in a State 
     with an unemployment rate above 8.5%, and with the condition 
     that no such individual could receive a total of more than 99 
     weeks of benefits from all sources (counting State, EUC and 
     EB programs).
       (5) As the table above reflects, weeks of benefits payable 
     in tiers 1, 3 and 4 in September through December 2012 would 
     be adjusted, with tier 1 dropping from 20 to 14 weeks, tier 3 
     dropping from 13 to 9 weeks, and tier 4 rising from 6 to 10 
     weeks. In all, these changes will result in the maximum weeks 
     of benefits payable under the EUC program falling from 53 
     weeks under current law (in the case of States with 
     unemployment rates today at or above 8.5%) to a maximum of up 
     to 47 weeks (in the case of States with an unemployment rate 
     of 9% or higher) from September through December 2012. In 
     each period, an individual's eligibility for a tier of 
     benefits will be determined according to the State's 
     unemployment rate in that period. For example, individuals 
     exhausting tier 2 of benefits will be eligible to begin tier 
     3 of benefits in the spring only if their State has an 
     unemployment rate of at least 6%, while those exhausting tier 
     2 in the summer and fall months can qualify for tier 3 
     benefits only if they are in a State with an unemployment 
     rate of at least 7%.
       The conference agreement specifies that States are required 
     to pay EUC benefits before any benefits under the EB program.
       The conference agreement follows the House bill in terms of 
     extending the current temporary 100% Federal financing of EB 
     as well as the three-year lookback used to determine State 
     eligibility for EB, with the modification that in each case 
     the extension would apply through December 2012.
       The conference agreement follows the House bill and Senate 
     amendment with regard to the temporary extended railroad 
     unemployment benefit program, with the modification that the 
     extension would apply through December 2012.


     PART 3--IMPROVING REEMPLOYMENT STRATEGIES UNDER THE EMERGENCY 
                   UNEMPLOYMENT COMPENSATION PROGRAM

     H2161,2162,2163,2164,2165/S--

     Current law
       Federal unemployment law does not contain explicit job 
     search requirements for the receipt of EUC08 benefits. 
     Federal unemployment law does not require states to have work 
     search requirements in the regular UC program. However, all 
     states have work search requirements in state law or 
     regulation in order for an individual to receive regular UC 
     benefits. Section 202(a)(3)(A)(ii) of the Federal-State 
     Extended Unemployment Compensation Act of 1970 (P.L. 97 373), 
     as amended, explicitly requires active job search for receipt 
     of Extended Benefits (EB). However, the method of determining 
     active job search is left to the determination of the states.
       Federal law does not require minimum educational standards 
     or reemployment service participation as a condition of EUC08 
     benefit receipt.
       P.L. 110 252, as amended, requires that all EUC08 benefits 
     be paid directly to the unemployed who have exhausted 
     entitlement to all regular UC benefits. There is no provision 
     for demonstration projects.
       Section 4005(c)(1) of P.L. 110 252, as amended allows 
     states but does not require states to offset EUC08 payments 
     by non-fraud overpayments. Any offset under current law may 
     not be more than 50% of total EUC08 benefit.
       Section 4001(g) of the Supplemental Appropriations Act of 
     2008 (P.L. 110 252), as amended, prevents states from 
     decreasing the average weekly benefit amount of regular UC 
     payments. That is, a state is not permitted to pay an average 
     weekly UC benefit that is less than what would have been paid 
     under

[[Page H865]]

     state law prior to what was in effect on June 2, 2010. This 
     ``nonreduction rule'' is a condition of the EUC08 Federal-
     State agreement of P.L. 110 252, as amended.
     House bill
       Section 2161 would require active work search for EUC08 
     entitlement where active work search must require at least 
     the following: individuals to register with reemployment 
     services within 30 days, individuals post a resume, record, 
     or other application for employment on a database required by 
     the state, and individuals apply for work in such a manner as 
     required by the state.
       Section 2162 would require EUC08 beneficiaries (1) to 
     participate in reemployment services if referred and (2) to 
     actively search for work, effective on or after 30 days of 
     enactment for those individuals who enter a tier of EUC08. 
     This section would require individuals to meet the minimum 
     educational requirements (high school degree, GED, or 
     enrolled in program) created earlier in Section 2122 of the 
     proposal (amending Section 303(a)(10)(B) of the SSA). The 
     participation requirement for reemployment services would be 
     waived if individuals have already completed this requirement 
     or if there is ``justifiable cause'' as specified by guidance 
     to be issued by the U.S. DOL Secretary within 30 days. This 
     section would authorize up to $5 of an individual's EUC08 
     benefit each week to be diverted (at state option) to fund 
     these reemployment services and activities.
       Section 2163 would allow for up to 20% of all EUC08 
     recipients in each state to be diverted into demonstration 
     projects. The demonstration projects would need to be 
     designed to expedite reemployment. Allowable demonstration 
     activities would include: subsidies for employer provided 
     training; work sharing or Short-Time Compensation; enhanced 
     employment strategies and services; SEA programs; services 
     that enhance skills that would assist in obtaining 
     reemployment; direct reimbursements to employers who hire 
     individuals that were receiving EUC08; and other innovative 
     activities not otherwise described. Authority for 
     demonstration projects would end when EUC08 ceases to be 
     payable. Demonstration projects would be required to provide 
     appropriate reemployment services and assurances of no net 
     increase in cost to the EUC08 program. This section would 
     require states to provide information on demonstration 
     projects for reporting and evaluation purposes.
       Section 2164 would require states to offset an individual's 
     EUC08 benefit if they received an unemployment benefit 
     overpayment. States would be required to offset by at least 
     50% of the EUC08 benefit in any week.
       Section 2165 would repeal the ``nonreduction rule'' in 
     terms of the regular UC benefit amount. This would give 
     states the option to decrease average weekly benefit amounts 
     without invalidating their EUC08 Federal-state agreements.
     Senate bill
       No provision.
     Conference substitute
       The conference agreement follows the House bill with regard 
     to explicit job search requirements, with several 
     modifications designed to closely align the work search 
     requirements between the EUC and EB programs. In order to be 
     eligible for benefits in any week, the state agency shall 
     find that the individual is able to work, available to work, 
     and making reasonable efforts to secure suitable work.
       For purposes of this provision, the term ``making 
     reasonable efforts to secure suitable work'' means, with 
     respect to an individual, that such individual: (1) Is 
     registered for employment services in such manner and to such 
     extent as prescribed by the state agency; (2) Has engaged in 
     an active search for employment that is appropriate in light 
     of the individual's skills, capabilities and work history, 
     and includes a number of employer contacts that is consistent 
     with reasonable standards communicated to the individual by 
     the state; (3) Has maintained a record of such work search, 
     including employers contacted, method of contact and date 
     contacted; and (4) When requested, has provided such work 
     search record to the state agency. The Secretary of Labor 
     shall prescribe to each state a minimum number of claims for 
     which work search records must be audited on a random basis 
     in any given week.
       The conference agreement follows the House bill with regard 
     to the requirement that EUC recipients participate in 
     reemployment services if referred and as well as actively 
     search for work. The conference agreement follows the Senate 
     amendment with regards to there being no minimum education 
     requirements for individuals receiving EUC benefits.
       The conference agreement follows the House bill with regard 
     to the requirement that States provide reemployment services 
     and reemployment and eligibility assessment activities to 
     long-term unemployed individuals who begin receiving EUC 
     benefits and throughout their time collecting EUC benefits. 
     The conference agreement follows the Senate amendment with 
     regard to no State authority to reduce EUC benefits to 
     support the cost of such reemployment services and 
     activities. In its place, the conference agreement provides 
     new one-time funding to States to support the cost of such 
     reemployment services and activities.
       The conference agreement follows the Senate amendment with 
     respect to no additional State flexibility to assist the 
     long-term unemployed with improved reemployment services 
     using EUC funds.
       The conference agreement follows the House bill with regard 
     to requiring States to offset current Federal benefits to 
     recover prior overpayments of State, other States', or 
     Federal unemployment benefits. With regard to efforts to 
     recover such overpayments owed to other States and the 
     Federal government, the conference agreement requires each 
     State to apply hardship exceptions and related terms that 
     follow State practice used to recover overpayments of its own 
     State benefit funds.
       The conference agreement modifies the House bill with 
     regard to effect of the current ``nonreduction rule,'' which 
     generally blocks the payment of Federal EUC funds to States 
     that have reduced State unemployment benefits. Several 
     States, in order to address solvency have passed laws to 
     reduce future State benefit amounts, and others may be 
     considering doing the same. Thus, the continued application 
     of the ``nonreduction rule'' (if not adjusted) would bar such 
     States from receiving EUC funds otherwise provided under this 
     legislation. For this reason, the conference agreement 
     changes the effective date of the non-reduction rule to March 
     1, 2012 in order to allow for changes states have made (i.e. 
     both those that have already enacted laws changing benefit 
     amounts, as well as those with legislation pending that would 
     do so),'' This permits States to adjust benefits as they have 
     planned, while remaining eligible for Federal EUC funds 
     throughout CY 2012.

                       Subtitle D--TANF Extension

     H2302/S312

     Current law
       The Temporary Payroll Tax Cut Continuation Act of 2011 
     (P.L. 112 78) provided program authorization and funding for 
     most Temporary Assistance for Needy Families (TANF) grants 
     through February 29, 2012. It provided authority and funding 
     for state family assistance grants (the basic block grant), 
     healthy marriage and responsible fatherhood grants, mandatory 
     child care grants, tribal work program grants, matching 
     grants for the territories, and research funds. Grants are 
     funded at the same level as in FY2011, and paid on a pro-
     rated quarterly basis. No funding was provided for TANF 
     supplemental grants. The TANF contingency fund was provided 
     an FY2012 appropriation in legislation enacted in 2010, P.L. 
     111 242.
     House bill
       Section 2302 provides FY2012 appropriations for TANF state 
     family assistance grants, healthy marriage and responsible 
     fatherhood grants, mandatory child care grants, tribal TANF 
     work programs, matching grants for the territories, and 
     research funds. FY2012 grants are provided at the same level 
     as were provided in FY2011.
     Senate bill
       Section 312 extends program authorization and funding for 
     TANF through February 29, 2012. Grants are funded at the same 
     level as in FY2011, and paid on a pro-rated quarterly basis. 
     (Provision is the same as current law. It is identical to 
     that subsequently enacted in P.L. 112 78.)
     Conference substitute
       The conference agreement follows the House bill with 
     technical corrections to ensure the provisions operate as 
     intended. Section 2302(c)(1) is revised by changing the year 
     to 2013 instead of 2012 to correct a drafting error. Section 
     2302(c)(2)(A) is revised by changing the year to 2012 instead 
     of 2011 to correct a drafting error. Section 2302(i) is 
     revised by striking ``or section 403(b) of the Social 
     Security Act'' to reflect the intent that TANF contingency 
     funds are not affected by this bill and that they continue as 
     previously authorized and appropriated for FY 2012, and also 
     to update the provision to add a reference the Temporary 
     Payroll Tax Cut Continuation Act of 2011 which extended TANF 
     through February 29, 2012.
     H2303,2304,2305/S--

     Current law
       States are required to report case- and individual-level 
     demographic, monthly financial and monthly work participation 
     information to the Department of Health and Human Services 
     (HHS) on a quarterly basis.
       There are no relevant provisions in current law regarding 
     Section 2304 of the House bill.
     House bill
       Section 2303 requires HHS to issue a rule designating 
     standard data elements for any category of information 
     required to be reported under TANF. The rule would be 
     developed by HHS in consultation with an interagency 
     workgroup established by the Office of Management and Budget 
     (OMB) and with consideration of state and tribal 
     perspectives. To the extent practicable, the standard data 
     elements required by the rule would be non-proprietary and 
     incorporate the interoperable standards developed and 
     maintained by other recognized bodies. To the extent 
     practicable, the data reporting standards required by the 
     rule would incorporate a widely-accepted, nonproprietary, 
     searchable, computer-readable format; be consistent with and 
     implement applicable accounting principles; be capable of 
     being continually upgraded as necessary; and incorporate 
     existing nonproprietary standards, such as the ``eXtensible 
     Business Reporting Language.'' The data standardization 
     requirement would take effect on October 1, 2012.

[[Page H866]]

       Section 2304 requires states to maintain policies and 
     practices to prohibit TANF assistance from being used in any 
     transaction in liquor stores, casinos and gaming 
     establishments, and strip clubs. States have up to 2 years 
     after enactment to implement such policies and practices. 
     States that fail to report actions they have taken are at 
     risk of being penalized by up to a 5% reduction in their 
     block grant.
       Section 2305 makes technical corrections to the TANF 
     statute.
     Senate bill
       No provision.
     Conference substitute
       The conference agreement follows the House bill with the 
     following technical modifications to Section 2303: Section 
     2303(a) is modified to clarify that the goal of the provision 
     is to standardize the data exchange processes, not 
     standardize data elements. Section 2303(b) is modified to 
     require that the Department of Health and Human Services 
     issue proposed rules for this section within 12 months of the 
     enactment of this section, and that the agency finalize these 
     regulations within 24 months of the enactment of this 
     section.
       The conference agreement follows the House bill with the 
     following technical modifications to Section 2304: Section 
     2304(a)(12)(A) is modified to clarify that States are 
     required to block access to TANF funds provided on electronic 
     benefit transfer cards at ATMs and point-of-sale devices in 
     specified locations. Section 2304(a)(12)(B) is modified by 
     adding a definition of electronic benefit transfer 
     transactions. Section 2304(b)(16)(A) is modified to clarify 
     that each State must provide a report to the Secretary of 
     Health and Human Services regarding their implementation of 
     this provision.

                   TITLE III--FLOOD INSURANCE REFORM


                    REFORM OF PREMIUM RATE STRUCTURE

     H3005(a),3005(b),3005(c),3005(d),3005(e)/S--

     Current law
       The Federal Emergency Management Agency (FEMA) is 
     authorized to increase chargeable risk premium rates for 
     flood insurance for any properties within any single risk 
     classification 10% annually. 42 U.S.C. 4015 (e)
       Full actuarial rates begin on the effective date of a 
     revised Flood Hazard Boundary Map or Flood Insurance Rate Map 
     for a community. Sec.  61.11
       FEMA is authorized to establish risk premium rates for 
     flood insurance coverage. The agency is also authorized to 
     offer ``chargeable'' (subsidized) premium rates for pre-FIRM 
     buildings. Post-FIRM structures (i.e., buildings constructed 
     on or after December 31, 1974) and the effective date of the 
     FIRM, whichever is later, must pay the full actuarial risk 
     premium rates. Sec.  61.8
       Pre-FIRM structures continue to receive subsidized premium 
     rates after the lapsed policy provided the policyholder pays 
     the appropriate premium to reinstate the policy.
       FEMA is authorized to determine whether a community has 
     made adequate progress on the construction of a flood 
     protection system involving federal funds. Adequate progress 
     means the community has provided FEMA with necessary 
     information to determine that 100% of the cost has been 
     authorized, 60% has been appropriated or 50% has been 
     expended. Sec.  61.12
     House bill
       Section 3005(a) would increase the annual cap on premium 
     increases from 10% to 20%.
       Section 3005(b) would clarify that newly mapped properties 
     are phased-in to full actuarial, flood insurance rates at a 
     consistent rate of 20% per year over 5 years and requires 
     that newly mapped property owners pay 100% of actuarial rates 
     at the end of the 5 year phase-in period. For areas eligible 
     for the lower-cost Preferred Risk Policy (PRP) rates, the 
     phase-in begins after the expiration of their PRP rates. For 
     all properties, the phase-in of rates only applies to 
     residential properties occupied by their owner or a bona fide 
     tenant as a primary residence.
       Section 3005(c) would require that, beginning one year 
     after enactment, the premium rate subsidies (pre-FIRM 
     discounts) for certain properties in the following categories 
     be phased-out, with annual rate increases limited by a 20 
     percent annual cap. This would apply to commercial 
     properties, second and vacation homes (i.e., residential 
     properties not occupied by an individual as a primary 
     residence), homes sold to new owners, homes damaged or 
     improved (substantial flood damage exceeding 50 percent or 
     substantial improvement exceeding 30 percent of the fair 
     market value of the property), and properties with multiple 
     flood claims (i.e., statutorily defined severe repetitive 
     loss properties.)
       Section 3005(d) would remove the eligibility of property 
     owners who allow their policies to lapse by choice to receive 
     discounted rates on those properties.
       Section 3005(e) would update the standards by which FEMA 
     evaluates a community's eligibility for special flood 
     insurance rates by considering state and local funding, in 
     addition to federal funding, of flood control projects.
     Senate bill
       No provision.
     Conference substitute
       No provision.


                    MANDATORY PURCHASE REQUIREMENTS

     H3003(b)(3),3003(c),3004(a),3007(e),3014,3017,3018/S--
     Current law
       There are no relevant provisions in current law regarding 
     Section 3003(b)(3) of the House bill.
       FEMA is authorized to enter into arrangements with 
     individual private sector property insurance companies or 
     other insurers, such as public entity risk sharing 
     organizations. Under this Write-Your-Own company arrangement, 
     such companies may offer flood insurance coverage under the 
     program to eligible applicants. Sec.  62.23
       The NFIP requires the purchase of flood insurance on and 
     after March 2, 1974, as a condition of receiving any form of 
     federal or federally-related financial assistance for 
     acquisition or construction purposes with respect to 
     insurable buildings and mobile homes within an identified 
     special flood, mudslide, or flood-related erosion hazard area 
     that is located within any community participating in the 
     NFIP. Sec.  59.2 The mandatory purchase of insurance is 
     required in areas identified as being within designated Zones 
     A, A1 30, AE, A99, AO, AH, AR, AR/A1 30, AR/AE, AR/AO, AR/AH, 
     AR/A, V1 30, VE, V, VO, M, and E. Sec.  64.3
       When FEMA has provided a notice of final flood elevations 
     for one or more special flood hazard areas (SFHA) on the 
     community's FIRM, the community shall require that all new 
     construction and substantial improvements of residential 
     structures within Zones A1 30, AE and AH zones on the 
     community's FIRM have the lowest flood (including basement) 
     elevation to or above the base flood level, unless the 
     community is granted an exception by FEMA for the allowance 
     of basements. Sec.  60.3(a) Structures in SFHAs that receive 
     any form of federal or federally-related financial assistance 
     are required to purchase flood insurance. Sec.  59.2(a)
       FEMA is required to provide notice of final base flood 
     elevations within Zones A1 30 and/or AE on the community's 
     FIRM that is available for public viewing by homeowners in 
     SFHAs. Sec.  60.3(e) Structures located in these zones are 
     classified as SFHA and are, therefore, required to purchase 
     flood insurance. Sec.  59.2(a)
       The NFIP was established to provide flood insurance 
     protection to property owners in flood-prone areas. However, 
     flood insurance is only available in communities that 
     participate in the NFIP. Sec.  59.2 To qualify for flood 
     insurance availability a community must apply for the entire 
     area within its jurisdiction and shall submit copies of 
     legislative and executive actions indicating a local need for 
     flood insurance and an explicit desire to participate in the 
     NFIP. Sec.  59.22
       There are no relevant provisions in current law regarding 
     Section 3018 of the House bill.
     House bill
       Section 3003(b)(3) would require lenders or servicing 
     companies to terminate policies purchased on behalf of the 
     homeowner to satisfy the mandatory purchase requirement 
     within 30 days of being notified that the homeowner has 
     purchased another policy. Lenders would be required to refund 
     any premium payments and fees made by the homeowner for the 
     time when both policies were in effect. Moreover, the 
     declaration page in the insurance policy would be considered 
     sufficient to demonstrate having met the mandatory insurance 
     purchase requirements.
       Section 3003(c) would require lenders to accept flood 
     insurance from a private company if the policy fulfills all 
     federal requirements for flood insurance.
       Section 3004(a) would authorize the Administrator of FEMA 
     to delay mandatory purchase requirement for owners of 
     properties in newly designated special flood hazard areas. 
     The delay would not be longer in duration than 12 months with 
     the possibility of two 12 month extensions at the discretion 
     of FEMA. Eligible areas defined as an area that meets the 
     following three requirements: (1) area with no history of 
     special flood hazards; (2) area with a flood protection 
     system under improvement; or (3) area has filed an appeal of 
     the designation of the area as having special flood hazards. 
     Upon a request submitted from a local government authority, 
     FEMA could suspend the mandatory purchase for a possible 
     fourth and fifth year for certain communities that are making 
     more than adequate progress in their construction of their 
     flood protection systems.
       Section 3007(e) would clarify that mandatory purchase 
     requirement would not apply to a property located in an area 
     designated as having a special flood hazard if the owner of 
     such property submits to FEMA an elevation certificate 
     showing that the lowest level of the primary residence is at 
     an elevation that is at least three feet higher than the 
     elevation of the 100-year flood plain. FEMA would be required 
     to accept as conclusive each elevation certificate unless the 
     Administrator conducts a subsequent elevation survey and 
     determines that the lowest level of the primary residence in 
     question is not at an elevation that is at least three feet 
     higher than the elevation of the 100-year flood plain. This 
     section would require FEMA to expedite any requests made by 
     an owner of a property showing that the property is not 
     located within the area having special flood hazards. FEMA 
     would be prohibited from charging a fee for reviewing the 
     flood hazard data with respect to the expedited request and 
     requiring the owner to provide any additional elevation data.
       Section 3014 would require the Administrator of FEMA, in 
     consultation with affected communities, to notify annually 
     residents in areas having special flood hazards

[[Page H867]]

     that they reside in such an area, the geographic boundaries 
     of such areas, the requirements to purchase flood insurance 
     coverage and the estimated cost of flood insurance coverage.
       Section 3017 would amend the Real Estate Settlement 
     Procedures Act of 1974 (RESPA) to require mortgage lenders to 
     include specific information about the availability of flood 
     insurance in each good-faith estimate.
       Section 3018 would amend RESPA to explicitly state that the 
     escrowing of flood insurance payments is required for many 
     types of loans.
     Senate bill
       No provision.
     Conference substitute
       No provision.


                        REFORM OF COVERAGE TERMS

     H3004(a),3004(b),3004(d),3004(e),3015,3016,3021/S--

     Current law
       There are no relevant provisions in current law regarding 
     Section 3004(a) of the House bill.
       The maximum amount of coverage for a single family 
     residential structure is $250,000 and $100,000 for personal 
     contents. The limit for nonresidential building structures is 
     $500,000 and $500,000 for contents. Sec.  61.6
       Insurance coverage under the NFIP is available only for 
     property structures and personal contents. Sec.  61.3
       Payment of full policyholder premium must be made at the 
     time of application or renewal. Sec.  61.5
       There are no relevant provisions in current law regarding 
     Section 3015 of the House bill.
       FEMA is authorized to enter into arrangements with 
     individual private insurers to offer flood coverage to 
     policyholders. Sec.  62.23
       The Standard Flood Insurance Policy issued under the NFIP 
     excludes coverage for hot tubs and spas that are not bathroom 
     fixtures, and swimming pools, and their equipment, such as, 
     but not limited to, heaters, filters, pumps, and pipes, 
     wherever located. Appendix A(1) to Part 62.
     House bill
       Section 3004(a) would set the minimum deductible levels at 
     $1,000 for properties with full-risk rates and $2,000 for 
     properties with discounted rates. The section would also 
     establish that maximum coverage limits be indexed for 
     inflation, starting in 2012.
       Section 3004(b) would authorize insurance coverage under 
     policies issued by the NFIP to be adjusted for inflation 
     since September 30, 1994. This section would clarify that 
     insured or applicants for residential insurance coverage 
     under the NFIP would receive up to an ``aggregate liability'' 
     of $250,000 per claim rather than a ``total amount'' of 
     $250,000. Nonresidential property owners would be insured for 
     a total of $500,000 aggregate liability for structure and 
     $500,000 aggregate liability for content. These amounts would 
     be adjusted or indexed for inflation using the percentage 
     change over the period beginning on September 30, 1994 
     through the date of enactment of the law.
       Section 3004(d) would authorize the Administrator of FEMA 
     to offer optional coverage for additional living expenses, up 
     to a maximum of $5,000, as well as to offer optional coverage 
     for the interruption of business operations up to a maximum 
     of $20,000, provided that FEMA: (1) charges full-risk rates 
     for such coverage; (2) makes a finding that a competitive 
     private market for such coverage does not exist; and (3) 
     certifies that the NFIP has the capacity to offer such 
     coverage without the need to borrow additional funds from the 
     U.S. Treasury.
       Section 3004(e) would authorize the Administrator of FEMA 
     to offer policyholders the option of paying their premiums 
     for one-year policies in installments, and authorizes FEMA to 
     impose higher rates or surcharges, or to deny future access 
     to NFIP coverage, if property owners attempt to limit their 
     coverage to coincide only with the annual storm season by 
     neglecting to pay their premiums on schedule.
       Section 3015 would require the Administrator of FEMA to 
     notify tenants of a property located in areas having special 
     flood hazard, that flood insurance coverage is available 
     under the NFIP for contents of the unit or structure leased 
     by the tenant, the maximum amount of such coverage for 
     contents, and how to obtain information regarding how to 
     obtain such coverage.
       Section 3016 would require the Administrator of FEMA to 
     notify the holders of direct policies managed by FEMA that 
     they could purchase flood insurance directly from an 
     insurance company licensed by FEMA to administer NFIP 
     policies. The coverage provided or the premiums charged to 
     holders of flood insurance policies that are administered by 
     an insurance company are no different from those directly 
     managed by FEMA.
       Section 3021 would require under the NFIP that the presence 
     of an enclosed swimming pool located at ground level or in 
     the space below the lowest flood of a building after November 
     30, and before June 1 of any year, would have no effect on 
     the terms of coverage or the ability to receive coverage for 
     such building if the pool is enclosed with non-supporting 
     breakaway walls.
     Senate bill
       No provision.
     Conference substitute
       No provision.


                   FINANCIAL AND BORROWING AUTHORITY

     H3011,3025,3033/S--

     Current law
       FEMA is authorized to carry out a program to provide 
     financial assistance to states and communities, using amounts 
     made available from the National Flood Mitigation Fund for 
     planning and carrying out activities designed to reduce the 
     risk of flood damage to structures. Such assistance shall be 
     made available to states and communities in the form of 
     grants to carry out mitigation activities. 44 U.S.C. 4104c(a)
       FEMA is authorized to issue notes or other obligations to 
     the Secretary of the Treasury, without the approval of the 
     President, to finance the flood insurance program. All funds 
     borrowed under this authority shall be deposited in the 
     National Flood Insurance Fund. 42 U.S.C. Sec.  4016(a)
       FEMA is authorized to borrow from the U.S. Treasury. 
     Borrowed funds must be repaid with interest. 42 U.S.C. Sec.  
     4017 (a)(3)
     House bill
       Section 3011 would streamline and reauthorize the Flood 
     Mitigation Assistance Program, the Repetitive Flood Claims 
     Program and the Severe Repetitive Loss Program in order to 
     improve their effectiveness and efficiency. Financial 
     assistance would be made available to states and communities 
     in the form of grants for carrying out mitigation activities, 
     especially with respect to severe repetitive loss structures, 
     repetitive loss structures, and to property owners in the 
     form of direct grants. This section would expand eligibility 
     for mitigation assistance grants from mitigating flood risk 
     to mitigating multiple hazards. Amounts provided could be 
     used only for mitigation activities that are consistent with 
     mitigation plans approved by FEMA. FEMA Administrator could 
     approve only mitigation activities that are determined to be 
     technically feasible, cost-effective, and result in savings 
     to the NFIF. This section would expand eligibility to include 
     mitigation activities for the elevation, relocation, and 
     flood-proofing of utilities (including equipment that serve 
     structures). The FEMA Administrator is required to consider 
     demolition and rebuilding of properties as eligible 
     activities under the mitigation grant programs. This section 
     establishes a matching requirement for severe repetitive loss 
     structures of up to 100% of all eligible costs and up to 90% 
     for repetitive loss structures. Other mitigation activities 
     would be in an amount up to 75% of all eligible costs. 
     Failure to award a grant within 5 years of receiving a grant 
     application would be considered to be a denial of the 
     application and any funding amounts allocated for such grant 
     applications would remain in the National Flood Mitigation 
     fund. This section authorizes $40 million in grants to States 
     and communities for mitigation activities, $40 million in 
     grants to States and communities for mitigation activities 
     for severe repetitive loss structures, and $10 million in 
     grants to property owners for mitigation activities for 
     repetitive loss structures. This section would eliminate the 
     Grants Program for Repetitive Insurance Claims Properties. 
     (Sec. 3011(b))
       Section 3025 would establish a reserve fund requirement to 
     meet the expected future obligations of the National Flood 
     Insurance Program. This section contains phase-in 
     requirements similar to H.R. 3121. For example, this section 
     requires the Fund to maintain a balance equal to 1% of the 
     sum of the total potential loss exposure of all outstanding 
     flood insurance policies in force in the prior fiscal year, 
     or a higher percentage as the Administrator determines to be 
     appropriate. FEMA has the discretion to set the amount of 
     aggregate annual insurance premiums to be collected for any 
     fiscal year necessary to maintain the reserve ratio, subject 
     to any provisions relating to chargeable premium rates and 
     annual increases of such rates.
       Section 3033 would require FEMA to submit a report to 
     Congress not later than 6 months after enactment of this Act 
     setting forth a plan for repayment within 10 years on the 
     amounts borrowed from the U.S. Treasury under the NFIP.
     Senate bill
       No provision.
     Conference substitute
       No provision.


               POLICY CLAIMS AND WRITE-YOUR-OWN INSURERS

     H3004,3022,3023,3028,3032/S--

     Current law
       The ``Exclusions'' section ``V'' of the Standard Flood 
     Insurance Policy stipulates that ``We do not insure a loss 
     directly or indirectly caused by a flood that is already in 
     progress at the time and date: (1) the policy term begins; or 
     (2) coverage is added at your request. Appendix A(1) to Part 
     61. Coverage for a new contract for flood insurance coverage 
     shall become effective upon the expiration of the 30 day 
     period beginning on the date that all obligations for such 
     coverage are satisfactorily completed. Sec.  61.11; 42 U.S.C. 
     4013(c)
       There are no relevant provisions in current law regarding 
     Section 3022 of the House bill.
       There are no relevant provisions in current law regarding 
     Section 3023 of the House bill.
       There are no relevant provisions in current law regarding 
     Section 3028 of the House bill.
     House bill
       Sections 3004 and 3032 would clarify the effective date of 
     insurance policies covering properties affected by floods in 
     progress. Property experiencing a flood during the 30-

[[Page H868]]

     day waiting period following the purchase of insurance would 
     be covered for damage to the property that occurs after the 
     30-day period has expired, but only if the property has not 
     suffered damage or loss as a result of such flood before the 
     expiration of such 30-day period. These sections would 
     require FEMA to review the processes and procedures for 
     determining that a flood event has commenced or is in 
     progress for purposes of flood insurance coverage and report 
     to Congress within 6 months.
       Section 3022 would require FEMA to grant policy holders the 
     right to request engineering reports and other documents 
     relied on by the Administrator and/or participating WYO 
     companies in determining whether the damage was caused by 
     flood or any other peril (e.g., wind). FEMA would also be 
     required to provide the information to the insured within 30 
     days of the request for information.
       Section 3023 would authorize FEMA to refuse to accept 
     future transfers of policies to the NFIP Direct program.
       Section 3028 would require FEMA to submit a report to 
     Congress describing procedures and policies for limiting the 
     number of flood insurance policies that are directly managed 
     by the Agency to not more than 10% of the total number of 
     flood insurance policies in force. After submitting the 
     report to Congress, the Administrator would have 12 months to 
     reduce the number of policies directly managed by the Agency, 
     or by the Agency's direct servicing contractor that is not an 
     insurer, to not more than 10% of the total number of flood 
     insurance policies in force.
     Senate bill
       No provision.
     Conference substitute
       No provision.


                   FLOOD RISK ASSESSMENT AND MAPPING

     H3006,3007,3008,3013,3014,3018,3020,3024,3026, 3030/S--

     Current law
       There are no relevant provisions in current law regarding 
     Section 3006 of the House bill.
       FEMA is authorized to identify and publish information with 
     respect to all areas within the United States having special 
     flood, mudslide, and flood-related erosion hazards. Sec.  
     65.1
       FEMA will only recognize in its flood hazard and risk 
     mapping effort those levee systems that meet, and continue to 
     meet, minimum design, operation, and maintenance standards 
     that are consistent with the level of protection sought 
     through the comprehensive floodplain management regulations. 
     Sec.  65.10
       There are no relevant provisions in current law regarding 
     Section 3013 of the House bill.
       FEMA publishes in the Federal Registry a notice of the 
     proposed flood elevation determination sent to the Chief 
     Executive Officer of the community. The agency also publishes 
     a copy of the community's appeal or a copy of its decision 
     not to appeal the proposed flood elevation determination. 
     Sec.  67.3
       A Standard Flood Insurance policyholder whose property has 
     become the subject of a Letter of Map Amendment may cancel 
     the policy within the current policy year and receive a 
     premium refund. Sec.  70.8 The policy could be canceled 
     provided (1) the policyholder was required to purchase flood 
     insurance; and (2) the property was located in a SFHA as 
     represented on an effective FIRM when the financial 
     assistance was provided. If no claim under the policy has 
     been paid or is pending, the full premium shall be refunded 
     for the current policy year, and for an additional policy 
     year where the insured had been required to renew the policy. 
     Sec.  62.5
       FEMA publishes a notice of the community's proposed flood 
     elevation determination in a prominent local newspaper at 
     least twice during the ten day period immediately following 
     the notification of the CEO. Sec.  67.4
       FEMA publishes a notice of the community's proposed flood 
     elevation determination in a prominent local newspaper at 
     least twice during the ten day period immediately following 
     the notification of the CEO. Sec.  67.4 Any owner or lessee 
     of real property, within a community where a proposed flood 
     elevation determination has been made who believes his 
     property rights to be adversely affected by the proposed base 
     flood determination may file a written appeal of such 
     determination with the CEO within 90 days of the second 
     newspaper publication of the FEMA proposed determination. 
     Sec.  67.5
       There are no relevant provisions in current law regarding 
     Section 3026 of the House bill.
       The NFIP participating community must provide written 
     assurance that they have complied with the appropriate 
     minimum floodplain management regulation. Sec.  60.3
     House bill
       Section 3006 would establish the Technical Mapping Advisory 
     Council (Council) to develop and recommend new mapping 
     standards for FIRMs. The Council would include 
     representatives from FEMA, the U.S. Geological Survey (USGS), 
     the U.S. Army Corps of Engineers (USACE), other federal 
     agencies, state and local governments, as well as experts 
     from private stakeholder groups. This section would require 
     that there is adequate number of representatives from the 
     states with coastlines or the Gulf of Mexico and other states 
     containing areas at high-risk for floods or special flood 
     hazard areas. The Council would submit the new mapping 
     standards for 100-year flood insurance rate maps to FEMA and 
     the Congress within 12 months of enactment and would continue 
     to review those standards for four additional years, at which 
     time the Council would be terminated. This section would 
     place a moratorium on the issuance of any updated flood 
     insurance rate maps from the date of enactment until the 
     Council submits to FEMA and Congress the proposed new mapping 
     standards. This section would allow for the revision, update 
     and change of rate maps only pursuant to a letter of map 
     change.
       Section 3007 would direct FEMA to establish new standards 
     for FIRMs beginning six months after the Technical Mapping 
     Advisory Council issues its initial set of recommendations. 
     The new standards would delineate all areas located within 
     the 100-year flood plain and areas subject to gradual and 
     other risk levels, as well as ensure the standards reflect 
     the level of protection levees confer. The standard must also 
     differentiate between a property that is located in a flood 
     zone and a structure located on such property that is not at 
     the same risk level for flooding as such property due to the 
     elevation of the structure and provide that such rate maps 
     are developed on a watershed basis. This section would 
     require FEMA to submit a report to Congress specifying which 
     Council recommendations were not implemented and explaining 
     the reasons such recommendations were not adopted. FEMA would 
     have 10 years to update all FIRMs in accordance with the new 
     standards subject to the availability of appropriated funds. 
     This section would eliminate requirements to more broadly map 
     areas considered to be residual risk.
       Section 3008 would prohibit the Administrator of FEMA from 
     issuing flood insurance maps, or make effective updated flood 
     insurance maps, that omit or disregard the actual protection 
     afforded by an existing levee, floodwall, pump or other flood 
     protection feature, regardless of the accreditation status of 
     such feature.
       Section 3013 would require the Administrator of FEMA, upon 
     any revision or update of any floodplain area or flood-risk 
     zone and the issuance of a preliminary flood map, to notify 
     in writing the Senators of each state affected and each 
     Member of Congress for each congressional district affected 
     by the flood map revision or update.
       Section 3014 would require the Administrator of FEMA to 
     establish projected flood elevations and to notify the chief 
     executive officer of each community affected by the proposed 
     elevation a notice of the elevations, including a copy of the 
     maps for the elevations and a statement explaining the 
     process to appeal for changes in such elevations.
       Section 3018 would require the Administrator of FEMA to 
     reimburse owners of any property, or a community in which 
     such property is located, for the reasonable costs involved 
     in obtaining a Letter of Map Amendment (LOMA) and Letter of 
     Map Revision (LOMR) if the change was due to a bona fide 
     error on the part of FEMA. The Administrator would be 
     authorized to determine a reasonable amount of costs to be 
     reimbursed except that such costs would not include legal or 
     attorney fees. The reasonable cost would consider the actual 
     costs to the owner of utilizing the services of an engineer, 
     surveyor or similar services. This section would require FEMA 
     to issue regulation pertaining to the reimbursements.
       Section 3020 would require FEMA to provide to a property 
     owner newly included in a revised or updated proposed flood 
     map a copy of the proposed FIRM and information regarding the 
     appeals process at the time the proposed map is issued.
       Section 3024 would require FEMA to notify a prominent local 
     television and radio station of projected and proposed 
     changes to flood maps for communities. This section would 
     authorize FEMA to grant an additional 90 days for property 
     owners or a community to appeal proposed flood maps, beyond 
     the original 90 day appeal period, so long as community 
     leaders certify they believe there are property owners 
     unaware of the proposed flood maps and appeal period, and 
     community leaders would use the additional 90 day appeal 
     period to educate property owners on the proposed flood 
     maps and appeal process.
       Section 3026 would authorize the use of Community 
     Development Block Grants to supplement state and local 
     funding for local building code enforcement departments and 
     flood program outreach.
       Under Section 3030, the Administrator of FEMA would be 
     required to conduct a study regarding the impact, 
     effectiveness, and feasibility of including widely used and 
     nationally recognized building codes as part of FEMA's 
     floodplain management criteria and submit a report to the 
     House Committee on Financial Services and Senate Banking, 
     Housing, and Urban Affairs Committee. The study would assess 
     the regulatory, financial, and economic impacts of such 
     building code requirement on homeowners, states and local 
     communities, local land use policies, and FEMA.
     Senate bill
       No provision.
     Conference substitute
       No provision.


                    STUDIES AND REPORTS FOR CONGRESS

     H3009(a),3009(b),3009(c),3009(d),3010,3025,3029, 3031/S--

     Current law
       There are no relevant provisions in current law regarding 
     Section 3009(a) of the House bill.
       FEMA is authorized to encourage insurance companies and 
     other insurers to form,

[[Page H869]]

     associate, or otherwise join together in a pool to provide 
     the flood insurance coverage authorized under the NFIP. 44 
     U.S.C. Sec.  4051 (a) FEMA is authorized to take such action 
     as may be necessary in order to make available reinsurance 
     for losses which are in excess of losses assumed by private 
     industry flood insurance pools. 42 U.S.C. Sec.  4055(a)
       There are no relevant provisions in current law regarding 
     Section 3009(d) of the House bill.
       There are no relevant provisions in current law regarding 
     Section 3010 of the House bill.
       There are no relevant provisions in current law regarding 
     Section 3025 of the House bill.
       There are no relevant provisions in current law regarding 
     Section 3029 of the House bill.
       There are no relevant provisions in current law regarding 
     Section 3031 of the House bill.
     House bill
       Section 3009(a) would require the Administrator of FEMA and 
     the Comptroller General of the United States to conduct 
     separate studies to assess a broad range of options, methods, 
     and strategies for privatizing the NFIP. FEMA and GAO would 
     submit reports (within 18 months of the date of the enactment 
     of this Act) to the House Committee on Financial Services and 
     the Senate Banking, Housing, and Urban Affairs Committee that 
     make recommendations for the best manner to accomplish 
     privatization of the NFIP.
       Section 3009(b) would authorize the Administrator of FEMA 
     to carry out private risk-management initiatives to determine 
     the capacity of private insurers, reinsurers, and financial 
     markets to assist communities, on a voluntary basis only, in 
     managing the full range of financial risk associated with 
     flooding. The Administrator would assess the capacity of the 
     private reinsurance, capital, and financial markets by 
     seeking proposals to assume a portion of the program's 
     insurance risk and submit to Congress a report describing the 
     response to such request for proposals and the results of 
     such assessment. The Administrator would be required to 
     develop a protocol to provide for the release of data 
     sufficient to conduct the assessment of the insurance 
     capacity of the private sector.
       Under Section 3009(c), the Administrator of FEMA would be 
     authorized to secure reinsurance coverage from private market 
     insurance, reinsurance, and capital market sources in an 
     amount sufficient to maintain the ability of the program to 
     pay claims and that minimizes the likelihood of having to 
     borrow from the U.S. Treasury.
       Under Section 3009(d), the Administrator would be required 
     to conduct an assessment of the claims-paying ability of the 
     NFIP, including the program's utilization of private sector 
     reinsurance and reinsurance equivalents, with and without 
     reliance on borrowing authority.
       Section 3010 would require the Administrator of FEMA to 
     submit an annual report to the Congress on the financial 
     status of the NFIP, including current and projected levels of 
     claims, premium receipts, expenses, and borrowing under the 
     program.
       Under Section 3025, the Administrator of FEMA would be 
     required to conduct a study regarding the impact, 
     effectiveness, and feasibility of including widely used and 
     nationally recognized building codes as part of FEMA's 
     floodplain management criteria and submit a report to the 
     House Committee on Financial Services and Senate Banking, 
     Housing, and Urban Affairs Committee. The study would assess 
     the regulatory, financial, and economic impacts of such 
     building code requirements on homeowners, states and local 
     communities, local land use policies, and FEMA.
       Section 3029 would require the Administrator of FEMA and 
     the Comptroller General of the United States to conduct 
     separate studies to assess options, methods, and strategies 
     for offering voluntary community-based flood insurance under 
     the NFIP. The studies would consider and analyze how the 
     policy options would affect communities having varying 
     economic bases, geographic locations, flood hazard 
     characteristics or classification, and flood management 
     approaches. The report and recommendations would be submitted 
     within 18 months after the enactment of this Act to the House 
     Committee on Financial Services and the Senate Banking, 
     Housing, and Urban Affairs Committee.
       Section 3031 would require the National Academy of Sciences 
     (NAS) to conduct a study of methods for understanding 
     graduated risk behind levees and the associated land 
     development, insurance, and risk communication dimensions. 
     The NAS would submit a report with recommendations within 12 
     months of the date of enactment of this Act to the House 
     Committee on Financial Services and Senate Banking, Housing, 
     and Urban Affairs Committee.
     Senate bill
       No provision.
     Conference substitute
       No provision.


                        MISCELLANEOUS PROVISIONS

     H3035/S--

     Current law
       There are no relevant provisions in current law regarding 
     Section 3035 of the House bill.
     House bill
       Section 3035 would allow state and local governments to use 
     the Army Corps of Engineers to evaluate locally operated 
     levee systems which were either built or designed by the 
     Corps, and which are being reaccredited as part of a NFIP 
     remapping. All costs associated with evaluations would 
     continue to be covered by the state or local government 
     requesting the evaluation.
     Senate bill
       No provision.
     Conference substitute
       No provision.

 TITLE IV--JUMPSTARTING OPPORTUNITY WITH BROADBAND SPECTRUM ACT OF 2011

                 Subtitle A--Spectrum Auction Authority

     H4005,4101,4102,4103,4104,4105,4106,4107/S--

     Current law
       There are no relevant provisions in current law regarding 
     Section 4005 of the House bill.
       Current law provides for auction of electro-magnetic 
     spectrum assigned for federal use but does not establish 
     deadlines for specified frequencies. Current law provides for 
     a Spectrum Relocation Fund. It requires that spectrum license 
     proceeds be paid to the General Fund except in the case of 
     auctions of federal spectrum being reallocated for commercial 
     use in which case unexpended proceeds are held for 8 years 
     before being deposited in the Treasury.
       Current law requires that 24 MHz of spectrum licenses in 
     700 MHz band be assigned for use by public safety agencies. 
     FCC regulations have designated 12 MHz for use by narrowband 
     radios carrying primarily voice communications and 2 MHz as 
     guard bands to mitigate radio interference. Licenses are 
     administered by state and local authorities. Current law 
     requires that auction proceeds be deposited in the General 
     Fund.
       The FCC has broad regulatory powers that might permit it to 
     reallocate TV broadcasting spectrum. Current law requires 
     that auction proceeds be deposited in the General Fund.
       There are no relevant provisions in current law regarding 
     Section 4104 of the House bill.
       The law requires the FCC to set rules regarding 
     participation in spectrum licenses auctions and for spectrum 
     use (service rules).
       Authority of FCC to use competitive bidding systems to 
     assign licenses for the use of designated portions of 
     electro-magnetic spectrum expires September 30, 2012.
       There are no relevant provisions in current law regarding 
     Section 4107 of the House bill.
     House bill
       Under Section 4005, payments of funds to and access to 
     spectrum license auctions would be prohibited for any person 
     who is barred by a federal agency for reasons of national 
     security.
       Section 4101 would set requirements for commercial auctions 
     of electro-magnetic spectrum currently assigned for federal 
     use as described by the bill. With exceptions, process of 
     preparing auctions would begin within three years of 
     enactment. Spectrum license auction proceeds would be 
     distributed to the Spectrum Relocation Fund, which would 
     receive an amount equal to 110% of projected federal agency 
     relocation costs, with the balance deposited with the Public 
     Safety Trust Fund.
       Section 4102 would require that these spectrum licenses be 
     released for commercial auction within five years of a 
     decision by a federally appointed Administrator. The decision 
     would be triggered by a declaration by the Administrator that 
     technology was available that would allow the migration of 
     voice communications from the 700 MHz narrowband networks to 
     the 700 MHz broadband network, thereby freeing up the 
     narrowband spectrum for auction to the commercial sector. 
     Would allocate $1 billion of auction proceeds to a new grant 
     program for states to acquire radio equipment.
       Section 4103 would provide the FCC with the authority to 
     establish incentive auctions for television broadcasters, 
     within specified limits. It would create a TV Broadcaster 
     Relocation Fund as a means for broadcasters to receive up to 
     $3 billion of auction revenue to cover relocation costs and 
     for other purposes. Proceeds above that amount would go to 
     the Public Safety Trust Fund through FY2021, after which 
     funds are to be deposited in the General Fund.
       Section 4104 would establish procedures for the FCC to 
     follow in reallocating television broadcasting spectrum 
     licenses for commercial auction.
       Section 4105 would set limitations on FCC auction and 
     service rules for future auctions. Would prohibit auction 
     rules that placed new conditions on prospective bidders 
     (spectrum caps). Would prohibit service rules that restrict 
     licensee's ability to manage network traffic (net neutrality) 
     or that would require providing network access on a wholesale 
     basis.
       Section 4106 would extend the FCC's auction authority 
     through FY 2021.
       Section 4107 would lay the groundwork to expand commercial 
     use of unlicensed spectrum within the federally managed 5GHz 
     band of wireless spectrum by requiring the FCC to commence a 
     proceeding as described in the bill.
     Senate bill
       No provision.

           Subtitle B--Advanced Public Safety Communications


                    PART 1--NATIONAL IMPLEMENTATION

     H4201,4202,4203,4204,4205/S--

     Current law
       The FCC is empowered to manage public safety use and assign 
     access to spectrum. FCC has assigned a single, nationwide 
     license for 10 MHz of public safety broadband

[[Page H870]]

     spectrum, which it regulates. The law requires that the D 
     Block be auctioned for commercial purposes, with proceeds 
     deposited in the General Fund.
       The Office of Emergency Communications (OEC) within the 
     Department of Homeland Security, as required by law, has 
     prepared a National Emergency Communications Plan. The law 
     also requires the OEC to work with other federal agencies in 
     developing appropriate standards for interoperability, among 
     other requirements. The FCC has used its regulatory authority 
     to create requirements for the use of public safety spectrum 
     at 700 MHz, including interoperability and standard-setting.
       Law has required that each state, in order to receive 
     federal funding for certain grants for public safety, must 
     establish a State Communications Interoperability Plan (SCIP) 
     and designate plan administrators at the state or local 
     level. OEC is charged with assisting and overseeing these 
     plans. Each state has submitted a SCIP to the OEC. Law also 
     required the creation of Regional Emergency Communications 
     Centers to facilitate regional planning for interoperability 
     at the regional level.
       There are no relevant provisions in current law regarding 
     Section 4204 of the House bill.
     House bill
       Section 4201 would assign a total of 20 MHz of 700 MHz 
     spectrum designated for public safety use to an 
     Administrator, competitively chosen by the NTIA. The 
     Administrator would manage the distribution of spectrum 
     capacity to individual states and enforce requirements 
     established in the bill. Specifically, provisions would 
     reallocate 10 MHz (the D Block) from commercial use to public 
     safety use.
       Section 4202 would establish requirements for the FCC to 
     create a Public Safety Communications Planning Board. The 
     Board would prepare, and submit to the FCC for approval, a 
     National Public Safety Communications Plan. The Plan would 
     include requirements for interoperability and standards, 
     among other provisions.
       Section 4203 would require the NTIA to request proposals 
     for the administration of the Plan. Would establish the 
     duties of the Administrator in working with State Public 
     Safety Broadband Offices to build interoperable networks 
     within each state.
       Section 4204 would provide borrowing authority of up to $40 
     million for the creation and initial operation of the 
     Administrator's office, to be repaid from auction revenue 
     received by the Public Safety Trust Fund.
       Section 4205 would require the OEC to submit to Congress a 
     study that would: review the importance of amateur radio in 
     responding to disasters; make recommendations for how to 
     enhance the use of amateur radio federally; and to identify 
     impediments to amateur radio such as private land use 
     restrictions on antennas.
     Senate bill
       No provision.


                      PART 2--STATE IMPLEMENTATION

     H4221,4222,4223,4224,4225/S--

     Current law
       FCC has promulgated regulations and requirements for public 
     safety broadband access.
       There are no relevant provisions in current law regarding 
     Section 4222 of the House bill.
       There are no relevant provisions in current law regarding 
     Section 4223 of the House bill.
       There are no relevant provisions in current law regarding 
     Section 4224 of the House bill.
       State and local governments have right to apply zoning law 
     procedures for requests to modify existing cell towers.
     House bill
       Section 4221 would require each state seeking to establish 
     a public safety broadband network, using 700 MHz public 
     safety broadband spectrum, to create a Public Safety 
     Broadband Office. Each office would prepare proposals for 
     building networks based on the requirements established 
     through the National Public Safety Communications Plan, 
     including for requests for proposal. The Administrator would 
     work with each state office in preparing and carrying out the 
     plans. In general, states would be required to sign 
     a contract with a commercial mobile provider to build the 
     network to specifications as provided in the bill and in 
     accordance with requirements established by the Public 
     Safety Communications Planning Board and by the 
     Administrator.
       Section 4222 would establish a matching grant program to 
     assist state Public Safety Broadband Offices.
       Section 4223 would create a State Implementation Fund for 
     the State Implementation Grant Program. The fund would 
     receive up to $100 million in auction revenue as specified in 
     the bill. Funds remaining at the end of 2021 would be 
     deposited in the General Fund.
       Section 4224 would provide grants to states for payments 
     under contracts entered into with the approval of the 
     Administrator.
       Section 4225 would require approval of requests for 
     modification of cell towers. This section would provide for 
     federal agencies to grant easements for the placement of 
     antennas on federal property. This section would require the 
     General Services Administration (GSA) to provide a common 
     request form for easements and rights-of-way and to establish 
     fees for this service, based on direct cost recovery. This 
     section would require the GSA to develop one or more 
     contracts for antenna placement and other specifications.
     Senate bill
       No provision.


                    PART 3--PUBLIC SAFETY TRUST FUND

     H4241/S--

     Current law
       There are no relevant provisions in current law regarding 
     Section 4241 of the House bill.
     House bill
       Section 4241 would create a fund to receive, hold and 
     disburse all auction proceeds as provided in the bill except 
     for $3 billion to be directed to the TV Broadcaster 
     Relocation Fund. Designated uses are: State and Local 
     Implementation, $100 million; Public Safety Administrator, 
     $40 million; Public Safety Broadband Network Deployment, 
     $4.96 billion plus 10% of any remaining amounts deposited in 
     the fund up to $1.5 billion; Deficit Reduction, $20.4 billion 
     from fund and balances upon expiration in FY 2021, plus at 
     least 90% of any additional auction revenue.
     Senate bill
       No provision.


             PART 4--NEXT GENERATION 9 1 1 ADVANCEMENT ACT

     H4265,4266,4267,4268,4269,4270,4271/S--

     Current law
       Similar provisions were in effect through statutes that 
     expired at the end of FY2009. Provisions included 
     requirements for a grant program and for planning for the 
     eventual transition to Next Generation 9 1 1.
       There are no relevant provisions in current law regarding 
     Section 4266 of the House bill.
       Law Requires FCC to study 9 1 1 fee collection and use and 
     issue a report annually.
       Law extends similar protection for existing 9 1 1 services.
       There are no relevant provisions in current law regarding 
     Section 4269 of the House bill.
       There are no relevant provisions in current law regarding 
     Section 4270 of the House bill.
     House bill
       Section 4265 would establish a federal 9 1 1 Coordination 
     Office to advance planning for next-generation 9 1 1 systems 
     and to fund a grant program with an authorization of $250 
     million. This section would direct the Assistant Secretary 
     (NTIA) and the Administrator of the National Highway Traffic 
     Safety Administration (NHTSA) to establish a 9 1 1 
     Implementation Coordination Office to reestablish and extend 
     matching grants, through October 1, 2021, to eligible state 
     or local governments or tribal organizations for the 
     implementation, operation, and migration of various 9 1 1, E9 
     1 1 (wireless telephone location), Next Generation 9 1 1 
     (voice, text, video), and IP-enabled emergency services and 
     public safety personnel training. This section would provide 
     immunity and liability protection, to the extent consistent 
     with specified provisions of the Wireless Communications and 
     Public Safety Act of 1999, to various users and providers of 
     Next Generation 9 1 1 and related services, including for the 
     release of subscriber information.
       Section 4266 would require GAO to prepare a report on 9 1 1 
     capabilities of multi-line telephone systems in federal 
     facilities, and would require the FCC to seek comment on the 
     feasibility of improving 9 1 1 identification for calls 
     placed through multi-line telephone systems.
       Section 4267 requires GAO to study how states assess fees 
     on 9 1 1 services and how those fees are used.
       Section 4268 would provide immunity and liability 
     protection, to the extent consistent with specified 
     provisions of the Wireless Communications and Public Safety 
     Act of 1999, to various users and providers of Next 
     Generation 9 1 1 and related services, including for the 
     release of subscriber information.
       Section 4269 would direct the FCC to: (1) initiate a 
     proceeding to create a specialized Do-Not-Call registry for 
     public safety answering points, and (2) establish penalties 
     and fines for autodialing (robocalls) and related violations.
       Section 4270 requires an analysis of costs and assessments 
     and analyses of technical uses.
       Section 4271 would require the FCC to assess the legal and 
     regulatory environment for development of NG9 1 1 and 
     barriers to that development, including state regulatory 
     roadblocks.
     Senate bill
       No provision.

                Subtitle C--Federal Spectrum Relocations

     H4301,4302,4303/S--

     Current law
       Law provides conditions of use and relinquishment of 
     spectrum, and related actions, by federal agencies. Federal 
     agencies that are relocating to new spectrum allocations in 
     order to accommodate commercial users for other uses may be 
     reimbursed for certain costs of relocation from the Spectrum 
     Relocation Fund, established for that purpose.
       Spectrum Relocation Fund created by the Commercial Spectrum 
     Enhancement Act of 2004 (P.L. 108 494, Title II).
       There are no relevant provisions in current law regarding 
     Section 4303 of the House bill.
     House bill
       Section 4301 would include shared use as an eligible action 
     and expenditures for planning would be newly included among 
     those costs eligible for reimbursement from the Spectrum 
     Relocation Fund. This section would establish a Technical 
     Panel to review a transition plan that the NTIA would be 
     required to prepare in accordance with provisions in the 
     bill. This section would require that the NTIA give priority 
     to options that would reallocate spectrum for exclusive, 
     nonfederal uses assigned through auction.

[[Page H871]]

       Section 4302 would address uses of the Fund, as described 
     in Sec. 4301, and would establish requirements regarding 
     transfers of funds in advance of auctions and reversion of 
     unused funds.
       Section 4303 would establish provisions under which non-
     disclosure of information regarding federal spectrum use 
     would be determined.
     Senate bill
       No provision.

            Subtitle D--Telecommunications Development Fund

     H4401,4402/S--

     Current law
       The Telecommunications Development Fund (TDF) was created 
     to provide funding for new ventures in telecommunications. 
     One source of funds comes from the requirement that interest 
     from certain escrow accounts overseen by the FCC be 
     transferred to the TDF.
       The law that created TDF requires board members to consult 
     with the FCC and the Treasury before finalizing decisions.
     House bill
       Section 4401 would require that interest accrued in 
     specified accounts be deposited in the General Fund.
       Section 4402 eliminates the role of federal agencies in 
     oversight of board activities.
     Senate bill
       No provision.
     Conference substitute
       Title VI--Public Safety Communications and Electromagnetic 
     Spectrum Auctions. The public safety and spectrum provisions 
     of this legislation advance wireless broadband service by 
     clearing spectrum for commercial auction, promoting billions 
     of dollars in private investment, and creating tens of 
     thousands of jobs. These provisions also deliver on one of 
     the last outstanding recommendations of the 9/11 Commission 
     by creating a nationwide interoperable broadband 
     communications network for first responders and generating 
     billions of dollars of Federal revenue.

                            TITLE V--OFFSETS

                       Subtitle A--Guarantee Fees

     H5001/S401,402

     Current law
       Similar provisions were enacted in Title IV of P.L. 112 78.
     House bill
       Section 5001 increases guarantee fees to reflect risk of 
     loss and cost of capital as if enterprises were fully private 
     regulated institutions. This section requires a minimum 
     increase of 10 basis points (0.10%) greater than average 2011 
     guarantee fees. To the extent that amounts are received from 
     fee increases imposed under this section that are necessary 
     to comply with the minimum increase required by this 
     subsection, such amounts shall be deposited directly into the 
     United States Treasury, and shall be available only to the 
     extent provided in subsequent appropriations Acts. Such fees 
     shall not be considered a reimbursement to the Federal 
     Government for the costs or subsidy provided to an 
     enterprise. This section provides for a two-year phase-in at 
     discretion of Director of FHFA. This section requires all 
     lenders to be charged a uniform guarantee fee. This section 
     requires an annual FHFA Report to Congress to include 
     information on up-front and annual guarantee fee increases, 
     and changes in riskiness of new mortgages. This section 
     applies to mortgages closed after the date of enactment. This 
     section expires October 1, 2021.
     Senate bill
       Sections 401 and 402 increase guarantee fees to reflect 
     risk of loss and cost of capital as if enterprises were fully 
     private regulated institutions. This section requires a 
     minimum increase of 10 basis points (0.10%) greater than 
     average 2011 guarantee fees. Amounts received from fee 
     increases imposed under this section shall be deposited 
     directly into the United States Treasury, and shall be 
     available only to the extent provided in subsequent 
     appropriations Acts. The fees charged pursuant to this 
     section shall not be considered a reimbursement to the 
     Federal Government for the costs or subsidy provided to an 
     enterprise. This section provides for a two-year phase-in at 
     discretion of Director of FHFA. This section requires all 
     lenders to be charged a uniform guarantee fee. This section 
     requires an annual FHFA Report to Congress to include 
     information on up-front and annual guarantee fee increases, 
     and changes in riskiness of new mortgages. This section 
     applies to mortgages closed after the date of enactment. This 
     section expires October 1, 2021. This section increases 
     guarantee fees on FHA-insured mortgages by 10 basis points 
     (0.10%) with phase-in over two years.
     Conference substitute
       No provision.

                   TITLE VI--MISCELLANEOUS PROVISIONS

     H6002,6003(a),6003(b),6004/S511,512

     Current law
       Section 263 of the Trade Adjustment Assistance Extension 
     Act of 2011 (P.L. 112 40) requires any fees for processing 
     merchandise entered between October 1 and November 12, 2012, 
     to be paid no later than September 25, 2012, in an amount 
     equivalent to the amount of such fees paid with respect to 
     merchandise entered between October 1 and November 12, 2011. 
     The section requires the Secretary of the Treasury to refund 
     with interest any overpayment of such fees. The section 
     prohibits any assessment of interest for any underpayments 
     based on the amount of fees paid for merchandise entered 
     between October 1 and November 12, 2012.
       Section 601(c) of the Tax Relief, Unemployment Insurance 
     Reauthorization, and Job Creation Act of 2010 (26 U.S.C. 1401 
     note) specifies the calendar year in which the payroll tax 
     holiday period applies. There is no Senate point of order 
     against the consideration of legislation that would amend 
     this section of the law.
       Section 251 of the Balanced Budget and Emergency Deficit 
     Control Act of 1985 (BBEDCA), as amended by the Budget 
     Control Act of 2011 (BCA), establishes enforceable statutory 
     limits on discretionary spending for each fiscal year 
     covering FY2012 FY2021. Section 251(b)(2)(A)(i) of the BBECCA 
     provides for these limits to be adjusted to accommodate 
     discretionary spending designated as emergency requirements 
     in statute (i.e., effectively exempting such spending from 
     the limits). Section 314 of the Congressional Budget Act of 
     1974, as amended by the BCA, allows the chairs of the budget 
     committees in each chamber to make similar adjustments for 
     purposes of congressional enforcement of these and other 
     spending limits during the consideration of spending 
     legislation. The existing Senate point of order against an 
     emergency designation (Section 403 of S. Con. Res. 13, 111th 
     Congress, the FY2010 budget resolution) does not apply to an 
     emergency designation pursuant to the BBEDCA; therefore, 
     there is no current Senate point of order against such a 
     designation.
       Under the Statutory Pay-As-You-Go Act of 2010 (Title I of 
     P.L. 111 139), the five-year and 10-year budgetary effects of 
     direct spending and revenue legislation enacted during a 
     session are placed on respective scorecards. At the end of a 
     session of Congress, if either scorecard shows an increase in 
     the deficit, a sequestration of non-exempt budgetary 
     resources is required to eliminate such deficit. Under the 
     law, off-budget effects and discretionary spending effects 
     are not counted.
     House bill
       Section 6002 repeals a requirement that importers pre-pay 
     certain fees authorized under the Consolidated Omnibus Budget 
     Reconciliation Act of 1985.
       Section 6003(a) creates a Senate point of order against the 
     consideration of any measure that ``extends the dates 
     referenced in section 601(c) of the Tax Relief, Unemployment 
     Insurance Reauthorization, and Job Creation Act of 2010.'' 
     Provides that a two-thirds affirmative vote would be required 
     to waive the point of order.
       Section 6003(b) amends the Budget Act to create a point of 
     order against an emergency designation pursuant to the BBEDCA 
     included in any measure. The new point of order is similar to 
     the existing Senate emergency designation point of order: (1) 
     if point of order is made, emergency designation is stricken 
     from the measure; and (2) a three-fifths affirmative vote is 
     required to waive the point of order and to sustain an appeal 
     of the ruling of the chair.
       Section 6004 provides that the budgetary effects of H.R. 
     3630 are not placed on either PAYGO scorecard, as long as the 
     legislation does not increase the deficit over the FY2013 
     FY2021 period. Also provides that off-budget effects, changes 
     to the statutory discretionary spending limits, and changes 
     in net income to the National Flood Insurance Program are to 
     be counted in determining the budgetary effects of the 
     legislation.
     Senate bill
       The Senate bill does not contain a provision regarding the 
     repeal of a requirement relating to time for remitting 
     certain merchandise processing fees.
       Section 511 amends the Budget Act to create a point of 
     order against an emergency designation pursuant to the BBEDCA 
     included in any measure. The new point of order is similar to 
     the existing Senate emergency designation point of order: (1) 
     if point of order is made, emergency designation is stricken 
     from the measure; and (2) a three-fifths affirmative vote is 
     required to waive the point of order and to sustain an appeal 
     of the ruling of the chair.
       Section 512 provides that the budgetary effects of H.R. 
     3630 are not placed on either PAYGO scorecard. Senate 
     provision makes no modifications to the conventional budget 
     scoring of the legislation.
     Conference substitute
       Section 7002. Repeal of Requirement Relating to Time for 
     Remitting Certain Merchandise Processing Fees: Repeals a 
     requirement that importers pre-pay certain fees authorized 
     under the Consolidated Omnibus Budget Reconciliation Act of 
     1985. The provision is identical to that contained in Section 
     6002 of the House bill.
       Section 7003. Points of Order in the Senate: Includes two 
     Senate points of order related to (1) protecting the Social 
     Security Trust Fund and (2) emergency spending. The provision 
     is identical to that contained in Section 6003 of the House 
     bill.
       Section 7004. PAYGO Scorecard Estimates: Provides that the 
     budgetary effects of the bill shall not be entered on the 
     statutory PAYGO scorecards provided that the bill is deficit 
     neutral over 10 years. The provision is identical to that 
     contained in Section 6004 of the House bill.


                 FEDERAL CIVILIAN EMPLOYEES PROVISIONS

     Current law
       Pay Freeze: The Continuing Resolution of December of 2010 
     included a two-year freeze

[[Page H872]]

     on all across-the-board, annual pay adjustments for federal 
     civilian employees, January 1, 2011 through December 31, 
     2012.
       Federal Employee Pensions: Most federal civilian employees 
     are participants in the Federal Employees Retirement System 
     (FERS), under which they make a contribution toward a defined 
     benefit pension equal to 0.8 percent of basic pay. Their 
     employing agency covers the remainder of the pension cost. At 
     normal retirement age, an employee is entitled to a pension 
     equal to 1 percent (or 1.1 percent for those retiring at age 
     62 with 20 years of service) of the average of the employee's 
     highest three years' compensation times the employee's years 
     of service. Certain FERS participants retiring prior to age 
     62 are entitled to the FERS annuity supplement. This benefit 
     is paid in addition to their defined benefit annuity, and 
     equals the Social Security benefit they would receive for 
     their FERS civilian service from the Social Security 
     Administration if eligible to receive Social Security on 
     their date of retirement. Most employees who first entered 
     federal government service before 1987 are covered by the 
     Civil Service Retirement System (CSRS), under which they 
     contribute 7 percent of their pay toward their defined 
     benefit pension. CSRS employees are not covered by Social 
     Security, so, unlike FERS employees, they are not subject to 
     the 6.2 percent Social Security contribution. Under both FERS 
     and CSRS, employee contributions and benefits for special 
     occupational groups and Members of Congress are higher. 
     Separate but comparable retirement systems exist for Foreign 
     Service and CIA employees.
     House bill
       Pay Freeze: The House bill would extend the current freeze 
     on across-the-board statutory pay adjustments for federal 
     civilian employees and Members of Congress through December 
     31, 2013.
       Federal Employee Pensions: The House bill would increase 
     the employee contribution for both CSRS and FERS employees by 
     0.5 percentage points each year for three years, beginning in 
     2013. Corresponding changes would be made to the Foreign 
     Service, CIA, and TVA retirement systems. The House bill 
     would establish new retirement rules for federal employees 
     hired after December 31, 2012, with less than 5 years of 
     service. Their contribution to FERS would increase by 3.2 
     percentage points. The FERS pension formula salary base for 
     new employees would change to the highest-five years' average 
     salary instead of highest three years. The FERS pension 
     formula multiplier for most new employees would be reduced to 
     0.7 percent per year of service, instead of 1 percent (or 1.1 
     percent for those retiring at age 62 with 20 or more years of 
     service). Employees in special occupational groups are 
     subject to a proportional adjustment to the multiplier (0.3 
     percentage points lower than current law). Finally, the House 
     bill would eliminate the FERS Annuity Supplement for 
     individuals not subject to mandatory retirement, beginning 
     January 1, 2013. Individuals subject to mandatory retirement 
     include certain categories of employees such as law 
     enforcement, fire fighters, air traffic controllers, and 
     nuclear materials couriers.
     Senate bill
       No Provision.
     Conference substitute
       Pay Freeze: No provision.
       Federal Employee Pension: The Conference Agreement would 
     increase by 2.3 percent the employee pension contribution for 
     federal employees entering service after December 31, 2012, 
     who have less than 5 years of creditable civilian service. 
     Corresponding increases in employee contributions would be 
     made for individuals entering the CIA and Foreign Service 
     pension systems. Members of Congress and congressional 
     employees entering service after December 31, 2012 who have 
     less than 5 years of creditable civilian service would be 
     subject to the same contribution rate and annuity calculation 
     as other federal employees.


                  MEDICARE AND OTHER HEALTH PROVISIONS

     Extension of MMA Section 508 Reclassifications

     Current law
       Under Medicare's Inpatient Prospective Payment System 
     (PPS), payments are adjusted by a wage index that is intended 
     to reflect the cost of labor in the area where the services 
     are furnished compared to a national average. Hospitals in 
     areas with higher wage costs have higher wage indices and 
     therefore receive higher PPS payments; hospitals in lower 
     wage areas have lower wage indices and receive lower 
     payments.
       Recognizing that the indices are not always accurate, 
     Congress in 1989 established a process whereby hospitals 
     could apply to ``reclassify'' to a nearby area, and receive 
     the higher wage index of that area. While a significant 
     number of hospitals (nearly 40%) have a reclassified wage 
     index, other hospitals have not been able to meet the 
     established criteria.
       Section 508 of the Medicare Modernization Act of 2003 (MMA) 
     directed the Centers for Medicare and Medicaid Services (CMS) 
     to develop new criteria that would allow additional hospitals 
     to qualify for a one-time, three-year reclassification.
       According to CMS, there were 89 hospitals receiving Section 
     508 reclassification payments in FY 2011.
     House bill
       No provision.
     Senate bill
       Section 302 extended the Section 508 reclassification 
     payments for two months (October and November 2011).
     Conference substitute
       Section 3001 extends Section 508 reclassification payments 
     through March 31, 2012.
     Extension of Outpatient Hold Harmless Payments

     Current law
       In 2000, Medicare implemented a PPS for hospital outpatient 
     services; prior to this time hospitals received cost-based 
     payments. For certain hospitals, primarily those located in 
     rural areas, the outpatient PPS payments were lower than the 
     payments they had received under the prior cost-based system. 
     The Balanced Budget Refinement Act of 1999 (BBRA) mandated 
     that rural hospitals with fewer than 100 beds receive 100% of 
     the difference between OPPS payments and what these hospitals 
     would have received under the cost-based system (thus the 
     name ``hold harmless'' payments). Over time, Congress has 
     lowered the payment percentage (it currently is 85%) and has 
     expanded the policy to sole community hospitals (SCHs), 
     hospitals that are further than 35 miles from another 
     hospital.
     House bill
       No provision.
     Senate bill
       Section 308 extended the hold harmless payment to all 
     eligible hospitals for two months (January and February 
     2012).
     Conference substitute
       Section 3002 extends the outpatient hold harmless payments 
     through December 31, 2012, except for SCHs with more than 100 
     beds. The provision requires a study by the Department of 
     Health and Human Services (HHS) by July 1, 2012, on which 
     types of hospitals should continue to receive hold harmless 
     payments in order to maintain adequate beneficiary access to 
     outpatient services.
     Physician Payment Update

     Current law
       The Sustainable Growth Rate (SGR) formula system was 
     established by the Balanced Budget Act of 1997 (BBA) as the 
     mechanism to determine the update to Medicare physician 
     payments beginning in 1999. The formula allows spending to 
     grow at the rate of the economy, adjusted for other factors 
     such as the number of beneficiaries in Medicare fee-for-
     service. The tally of actual and target expenditures is 
     cumulative in that it is maintained on an on-going basis 
     since the formula's inception. The update adjustment that 
     results from the SGR system is made through the conversion 
     factor. If spending exceeds the target, the adjustment to the 
     conversion factor is negative (physicians payments get 
     reduced). If spending is below the target, the adjustment is 
     positive (physician payments are increased). Physician 
     spending has routinely exceeded the target such that the SGR 
     formula has specified negative updates since 2002. Congress 
     has intervened 13 times to avert the cuts since 2003. The SGR 
     currently calls for a 27.4 percent across-the-board rate cut 
     for physicians to take effect on March 1, 2012.
     House bill
       Section 2201 replaced the 27.4 percent cut with a 1 percent 
     rate increase in 2012 and another 1 percent increase in 2013. 
     This section also required reports from the: Medicare Payment 
     Advisory Commission (MedPAC) on aligning private sector 
     initiatives to reward quality, efficiency, and practice 
     improvements with Medicare performance-based initiatives; 
     Government Accountability Office (GAO) on examining private 
     sector initiatives that base or adjust physician payments for 
     quality, efficiency, or care delivery improvement; and 
     Secretary of HHS on options for bundling payments for common 
     physician services. It also required the committees of 
     jurisdiction to provide information to Congress to assist in 
     the development of a long-term replacement to the current 
     Medicare physician payment system.
     Senate bill
       Section 301 froze physician payment rates at their 2011 
     level for two months (January and February 2012).
     Conference substitute
       Section 3003 freezes physician payment rates at their 
     current levels until December 31, 2012, averting a 27.4 
     percent reduction. The provision also requires reports from 
     the Secretary of HHS, due January 1, 2013, that examines 
     bundled or episode-based payments to cover physicians' 
     services for one or more prevalent chronic conditions or 
     major procedures. It also requires a GAO report, due January 
     1, 2013, that examines private sector initiatives that base 
     or adjust physician payment rates for quality, efficiency, 
     and care delivery improvement, such as adherence to evidence-
     based guidelines.
     Work Geographic Adjustment

     Current law
       Medicare payment for each physician service is made up of 
     three components: 1) physician work (the time, skill and 
     intensity for a physician to provide a service), 2) practice 
     expense (associated overhead costs), and 3) physician 
     liability insurance. Each of these components is adjusted 
     based on the relative costs associated with the geographic 
     area in which the physician practices. Medicare makes these 
     adjustments, known as Geographic Practice Cost Indices 
     (GPCIs), in each of its designated 89 geographic areas.

[[Page H873]]

      The national average work adjustment is set at a value of 
     1.0. Thus, geographic areas with an adjustment value greater 
     than 1.0 receive higher work payments than the areas with an 
     adjustment below that threshold. Current law maintains a work 
     adjustment floor--set at the national average value of 1.0--
     that increases work payments to physicians in the areas that 
     have a value below the national average. This floor increases 
     payments in 54 of 89 geographic areas. The MMA established 
     this policy starting in 2004 and Congress subsequently 
     extended it five times.
     House bill
       Section 2204 extended the work GPCI floor through December 
     31, 2012 and required that MedPAC submit a report by June 1, 
     2012 that assesses whether any work geographic adjustment is 
     needed, if so, at what level it should be applied, and the 
     impact of the floor on beneficiary access to care.
     Senate bill
       Section 303 extended the 1.0 GPCI floor for two months 
     (January and February 2012).
     Conference substitute
       Section 3004 extends the 1.0 work GPCI floor through 
     December 31, 2012. It also requires MedPAC to report by June 
     15, 2013, assessing whether any work geographic adjustment is 
     needed and, if so, at what level it should be applied, and 
     the impact of the floor on beneficiary access to care.
     Payment for Outpatient Therapy Services

     Current law
       The BBA imposed two annual per beneficiary payment limits 
     for all outpatient therapy services delivered by non-hospital 
     providers. For 2012, the annual limit on the allowed amount 
     for outpatient physical therapy (PT) and speech-language 
     pathology (SLP) combined is $1,880. There is a separate 
     $1,880 limit for occupational therapy (OT). Enforcement of 
     the caps has been blocked by legislation every year since 
     2000, with the exception of three months in 2003. The Deficit 
     Reduction Act of 2006 (DRA) required the HHS Secretary to 
     implement an exceptions process in 2006 for cases in which 
     the provision of additional therapy services above the cap 
     was determined to be medically necessary. Congress has 
     extended this exceptions process several times.
     House bill
       Section 2203 extended the exceptions process through 
     December 31, 2013, and made specific refinements to the 
     exceptions process to ensure that medical necessity is 
     documented and appropriately reviewed. Specifically, the HHS 
     Secretary was required to ensure, through claims processing 
     edits, that appropriate modifiers are on the claims 
     indicating that the responsible providers have documented 
     medical necessity for services paid above the therapy cap 
     threshold. In addition, all Medicare claims for therapy 
     services were required to include the national provider 
     identifier (NPI) for the physician or practitioner (not the 
     therapist rendering services) who periodically reviews the 
     therapy plan of care. The spending cap was permanently 
     expanded to include spending for therapy services provided in 
     hospital outpatient departments. Starting on July 1, 2012, 
     when a beneficiary's annual spending for therapy services 
     furnished in calendar year 2012 reaches $3,700 in PT and SLP, 
     or $3,700 in OT, any additional services would be subject to 
     a manual medical review process.
       By January 1, 2013, the Secretary was required to collect 
     detailed data on therapy patient conditions and outcomes that 
     could assist in reforming the current therapy payment system. 
     In addition, MedPAC was required to submit a report to the 
     committees of jurisdiction, making recommendations on how to 
     reform the payment system so that the benefit is better 
     designed to reflect individual acuity, condition, and therapy 
     needs of the patient. GAO was required to submit a study to 
     the committees of jurisdiction, examining CMS implementation 
     of the manual review process.
     Senate bill
       Section 304 extended the exceptions process for Medicare 
     outpatient therapy caps for two months (January and February 
     2012).
     Conference substitute
       Section 3005 extends the therapy caps exceptions process 
     through December 31, 2012. Starting with services provided on 
     or after October 1, 2012, the Secretary is required to ensure 
     that appropriate modifiers and NPIs are on the Medicare 
     claims and implement a manual medical review process for 
     beneficiaries whose annual spending for therapy services 
     furnished in calendar year 2012 reaches $3,700 in PT and SLP, 
     or $3,700 in OT. The spending caps are temporarily expanded 
     (through December 31, 2012) to include spending for therapy 
     services provided in hospital outpatient departments. The 
     conference agreement also requires the Secretary to collect 
     detailed data to assist in refining the therapy payment 
     system and also requires reports from GAO and MedPAC.
     Payment for Technical Component of Certain Physician 
         Pathology Services

     Current law
       Medicare pays for the preparation of pathology lab samples 
     (the ``technical component'') as well as the physician 
     interpretation and diagnosis associated with those samples 
     (``professional component''). Prior to 1999, independent labs 
     that performed the technical component (TC) of pathology lab 
     services for hospitals could bill Medicare directly for the 
     TC payment. In 1999, CMS implemented a new rule that 
     prohibited independent laboratories from billing for these 
     services, with the rationale that Medicare payment was 
     already included in the bundled payment to the hospital. 
     Hospitals that had in-house labs were unaffected. Hospitals 
     that had been utilizing independent labs as of July 22, 1999, 
     however, were ``grandfathered'' in the Benefits Improvement 
     and Protection Act (BIPA) of 2000, allowing them to continue 
     billing Medicare directly.
     House bill
       No provision.
     Senate bill
       Section 305 extended the TC grandfather policy for two 
     months (January and February 2012).
     Conference substitute
       Section 3006 extends the TC grandfather policy until June 
     30, 2012.
     Ambulance Add-On Payments

     Current law
       In 2002, a fee schedule was established for ground and air 
     ambulance services; it was fully implemented in 2006. 
     Currently, all ground ambulance services receive some type of 
     add-on: 2 percent for urban ground ambulance trips, 3 percent 
     for rural ground ambulance trips, and 22.6 percent for ground 
     ambulance trips that originate in ``super rural'' areas 
     (those in the lowest quartile in terms of population 
     density).
       Under the air ambulance fee schedule, rural providers 
     receive a 50% add-on. In 2006, the Office of Management and 
     Budget (OMB) changed the designation of a number of areas 
     from rural to urban, based on updated Census data, which 
     would have ended the rural add-on for air ambulances 
     originating in the affected areas. The Medicare Improvements 
     for Patients and Providers Act of 2008 (MIPPA) allowed these 
     affected areas to continue to be considered rural so that air 
     ambulances could continue to receive the rural add-on.
     House bill
       Section 2202 extended the payment add-ons for ground 
     ambulance services until December 31, 2012.
       Additionally, the House bill required GAO to update their 
     2007 report detailing current ambulance costs. The House bill 
     also required MedPAC to submit a report on the 
     appropriateness of the ambulance fee schedule and whether 
     there is a need to reform the ambulance fee schedule.
     Senate bill
       Section 306 extended the add-ons for ground ambulance 
     services and continued the rural designation for certain air 
     ambulance services for two months (January and February 
     2012).
     Conference substitute
       Section 3007 extends payment add-ons for ground ambulance 
     services and continued the rural designation for certain air 
     ambulance services until December 31, 2012. This provision 
     requires GAO to update its 2007 report by October 1, 2012, to 
     reflect current costs for ambulance providers and requires 
     MedPAC to submit a report by June 15, 2013, on the 
     appropriateness of the ambulance add-on payments and whether 
     there is a need to reform the ambulance fee schedule.
     Qualifying Individual Program

     Current law
       The Qualifying Individual (QI) program is a Medicare 
     savings program for certain low-income Medicare 
     beneficiaries, who are fully eligible for Medicare and 
     receive Medicaid assistance with their Medicare Part B 
     premiums. Unlike full benefit dually-eligible beneficiaries 
     who are fully eligible for both Medicare and Medicaid (known 
     as qualified Medicare beneficiaries (QMBs), or those with 
     incomes below 100 percent of poverty) and specified low-
     income Medicare beneficiaries (SLMBs, or those with incomes 
     between 100 and 120 percent of poverty), QI is a block grant 
     to states that must be reauthorized each year. Enrollment in 
     QI is limited by federal appropriations, and applications are 
     approved on a first-come, first-served basis. QI 
     beneficiaries must have incomes between 120 and 135 percent 
     of poverty ($13,404 to $15,079 for an individual in 2012).
     House bill
       Section 2211 extended the QI program through December 31, 
     2012.
     Senate bill
       Section 310 extended the QI program for two months (January 
     and February 2012).
     Conference substitute
       Section 3101 extended the QI program through December 31, 
     2012.
     Transitional Medical Assistance

     Current law
       Congress expanded the Transitional Medical Assistance (TMA) 
     program in 1988 as part of welfare-to-work programs, 
     requiring states to provide TMA to families who lose Medicaid 
     eligibility for work-related reasons for at least six, and up 
     to twelve, months. During the first six months of TMA, states 
     must provide the same benefits the family was receiving or 
     pay for costs of similar employer-based coverage. The second 
     six months of TMA is available for families who continue to 
     have a dependent child at home, meet reporting requirements, 
     and have average gross monthly earnings below 185% of 
     poverty.
       Congress created an additional work-related TMA option in 
     the American Recovery and Reinvestment Act of 2009 (ARRA). 
     Under

[[Page H874]]

     the ARRA option, states may choose to provide work-related 
     TMA for a full twelve-month period rather than two six-month 
     periods. These changes were informed by GAO work that found 
     the reporting requirements to be a substantial paperwork 
     barrier that caused significant numbers of eligible families 
     to lose coverage to which they were entitled. Thirteen states 
     have taken up the ARRA option: Alaska, Colorado, Connecticut, 
     Florida, Idaho, Maryland, Montana, New Mexico, New York, 
     Ohio, Oregon, South Dakota, and Wisconsin.
     House bill
       Section 2212 extended TMA, through December 31, 2012. In 
     addition, this provision contained new income reporting 
     requirements for any month of TMA coverage and limited TMA to 
     only those individuals with incomes below 185 percent of 
     poverty.
     Senate bill
       Section 311 extended TMA for two months (January and 
     February 2012).
     Conference substitute
       Section 3102 provides for an extension of TMA through 
     December 31, 2012.
     Modification to Requirements for Qualifying for Exception to 
         Medicare Prohibition on Certain Physician Referrals for 
         Hospitals

     Current law
       Physicians are generally prohibited from referring Medicare 
     patients to a health care facility in which they, or an 
     immediate family member, have a financial stake. However, 
     physician-owned hospitals have operated under an exception to 
     anti-trust laws, known as the ``whole hospital exception.''
       The Affordable Care Act (ACA) amended the ``whole hospital 
     exception'' by requiring that all hospitals with physician-
     ownership have a Medicare provider number by December 31, 
     2010. Any hospital without a Medicare provider number is not 
     permitted to bill Medicare for services provided to 
     beneficiaries under the ``whole hospital exception.'' 
     Grandfathered physician-owned hospitals, those with Medicare 
     provider numbers by December 31, 2010, may continue to 
     operate. However, they may not alter the proportion of 
     physician-ownership in the hospital. Under current law, a 
     grandfathered hospital may apply to expand the number of 
     operating rooms, procedure rooms and/or beds if it meets five 
     criteria.
     House bill
       Section 2213 allowed physician-owned hospitals that were 
     under construction but without a Medicare provider number on 
     December 31, 2010, to open and operate under the ``whole 
     hospital exception.'' The provision would also allow a 
     grandfathered hospital the ability to utilize the existing 
     expansion process if it certifies that it does not 
     discriminate against beneficiaries in federal health care 
     programs.
     Senate bill
       No provision.
     Conference substitute
       No provision.
     Extending Minimum Payment for Bone Mass Measurement

     Current law
       Dual energy X-ray absorptiometry (DXA) machines are used to 
     measure bone mass to identify individuals who may have or be 
     at risk of having osteoporosis. For those individuals who are 
     eligible, Medicare will pay for a bone density study once 
     every two years, or more frequently if the procedure is 
     determined to be medically necessary. The DRA capped 
     reimbursement of the technical component for x-ray and 
     imaging services as the lesser rate of the hospital 
     outpatient rate or the physician fee schedule. Additionally, 
     CMS implemented a new methodology for determining resource-
     based practice expense payments for all services contributed 
     to the reduction in the technical component reimbursement. 
     The ACA set DXA payments at 70 percent of the 2006 
     reimbursement rates for these services in 2010 and 2011.
     House bill
       No provision.
     Senate bill
       Section 309 extended the 70 percent of the 2006 payment 
     rate for two months (January and February 2012).
     Conference substitute
       No provision.
     Extension of Physician Fee Schedule Mental Health Add-on 
         Payment

     Current law
       Medicare pays for mental health services under the 
     physician fee schedule. MIPPA increased the fee schedule 
     amount for certain mental health service by 5 percent 
     beginning on July 1, 2008. Subsequent legislation extended 
     this add-on.
     House bill
       No provision.
     Senate bill
       Section 307 extended the 5 percent payment add-on for two 
     months (January and February 2012).
     Conference substitute
       No provision.
     Reduction of Bad Debt Treated as an Allowable Cost

     Current law
       Medicare reimburses providers for beneficiaries' unpaid 
     coinsurance and deductible amounts after reasonable 
     collection efforts. Medicare currently reimburses 70 percent 
     of beneficiary bad debts in acute care hospitals. Medicare 
     reimburses skilled nursing facilities 100 percent of the 
     allowable bad debt costs for Medicare beneficiaries who are 
     eligible for Medicaid (dual eligibles) and 70 percent of the 
     allowable costs for all other beneficiaries. Medicare 
     reimburses 100 percent of allowable bad debt in critical 
     access hospitals, rural health clinics, federally qualified 
     health clinics, community mental health clinics, health 
     maintenance organizations reimbursed on a cost basis, 
     competitive medical plans, and health care prepayment plans. 
     Medicare also reimburses end stage renal disease facilities 
     100 percent of allowable bad debt claims, with such payments 
     capped at the facilities' unrecovered costs.
     House bill
       Section 2224 gradually reduced the bad debt reimbursement, 
     beginning in 2013 and over a period of three years, for all 
     providers to 55 percent.
     Senate bill
       No provision.
     Conference substitute
       Section 3201 will reduce bad debt reimbursement for all 
     providers to 65 percent. Providers paid at 100 percent would 
     have a three-year transition of 88 percent in 2013, 76 
     percent in 2014, and 65 percent in 2015. Providers paid at 70 
     percent would be reduced to 65 percent in 2013.
     Rebase Medicare Clinical Laboratory Payment Rates

     Current law
       Medicare pays for clinical laboratory services under 
     carrier-specific fee schedules subject to national payment 
     limits. Most lab services receive payment at the national 
     limit amount.
     House bill
       No provision.
     Senate bill
       No provision.
     Conference substitute
       Section 3202 resets clinical lab base payment rates by 2 
     percent in 2013.
     Rebasing State DSH Allotments for Fiscal Year 2021

     Current law
       Medicaid Disproportionate Share Hospital (DSH) payments 
     provide additional funding to hospitals that serve a 
     disproportionate number of low-income patients. States 
     receive an annual DSH allotment to cover the costs of DSH 
     hospitals that provide care to low-income, uninsured 
     patients. This annual allotment is calculated by law and 
     includes requirements to ensure that the DSH payments to 
     individual hospitals are not higher than actual uncompensated 
     care costs. Each state's federal allotment is capped based on 
     either the prior year's allotment plus inflation or twelve 
     percent of the state's total Medicaid benefits payments for 
     the year. Once a state receives its federal allotment, the 
     state has discretion to distribute the funding to hospitals, 
     as long as the state's methodology is based on the Medicaid 
     inpatient utilization rate (exceeding one standard deviation 
     above the mean for all hospitals in the state) or a low-
     income utilization rate exceeding 25 percent.
       The ACA reduced DSH payments between 2014 and 2020, based 
     on a formula that the Secretary of HHS will develop through 
     future regulation.
     House bill
       Section 2225 would rebase the DSH allotments for FY2021 and 
     determine future allotments from the rebased level using 
     current law methodology.
     Senate bill
       No provision.
     Conference substitute
       Section 3203 extends the ACA Medicaid DSH payment 
     reductions in 2021.
     Technical Correction to the Disaster Recovery FMAP Provision

     Current law
       The ACA included a provision known as the `disaster-
     recovery FMAP' designed to help states adjust to drastic 
     changes in FMAP following a statewide disaster. Once 
     triggered, the policy would provide assistance for as many as 
     seven years following the disaster, as long as the state 
     continued to experience an FMAP drop of more than three 
     percentage points.
       During the first year, a state would receive an FMAP 
     increase equal to 50 percent of the difference between the 
     regular FMAP and the artificially lower FMAP. In the second 
     and succeeding years, the FMAP increase would be 25 percent 
     of the difference between the regular FMAP and the adjusted 
     FMAP from the previous year. However, there is an error in 
     the statute for the second and succeeding years. Instead of 
     creating a glide path downward, so that the affected state 
     could adjust to its new, lower FMAP, the 25 percent bump is 
     added to the higher, adjusted FMAP of the previous year 
     rather than the lower, base FMAP. This results in increasing 
     FMAPs for each year of the disaster-recovery period, 
     compounding over time. It also makes it easier for the 
     state to continue to qualify each year because it is 
     easier for there to be a three percentage point difference 
     between the artificially high FMAP and the base FMAP.
     House bill
       No provision.
     Senate bill
       No provision.

[[Page H875]]

     Conference substitute
       Section 3204 would address the error by instituting a lower 
     FMAP in the second and subsequent years.
     Prevention and Public Health Fund

     Current law
       The ACA established a Prevention and Public Health Trust 
     Fund to help shift the focus of the health care system to 
     prevention rather than treatment. The fund provides 
     increasing mandatory direct spending from $500 million in 
     2010 to $2 billion in 2015 and each year thereafter.
     House bill
       Section 2222 reduced trust fund dollars beginning in 
     FY2013, saving $8 billion.
     Senate bill
       No provision.
     Conference substitute
       Section 3205 reduces trust fund dollars beginning in 
     FY2013, saving $5 billion.
     Parity in Medicare Payments for Hospital Outpatient 
         Department Evaluation and Management Services

     Current law
       When a physician treats a beneficiary in a hospital 
     outpatient department, the physician's services are 
     reimbursed under Medicare's physician fee schedule and the 
     hospital receives a facility payment from Medicare under the 
     outpatient prospective payment system (OPPS). Because of the 
     facility payment, the total payment generally exceeds 
     payments for the same services provided in a physician 
     office.
     House bill
       Section 2223 would reduce hospital facility fee payments 
     for evaluation and management services provided in a hospital 
     outpatient department so that payment for the service in 
     aggregate would not exceed the amount under the Medicare 
     physician fee schedule beginning in 2012. These lower 
     payments would not be considered in the review of different 
     components of Medicare's OPPS to ensure that annual 
     adjustments are budget neutral.
     Senate bill
       No provision.
     Conference substitute
       No provision.
     Increase in Medicare Part B and Part D Premiums for High-
         Income Beneficiaries

     Current law
       The MMA of 2003 established that high-income beneficiaries 
     enrolled in Part B would pay a higher premium. The ACA 
     expanded this provision to the Part D program. Currently, 
     high-income beneficiaries are required to pay a greater share 
     of the Medicare Part B and Part D premiums (35 percent, 50 
     percent, 65 percent, or 80 percent) depending on their 
     income. For 2012, the income thresholds for those premium 
     shares are $85,000, $107,000, $160,000, and $214,000, 
     respectively for single filers. For married couples, the 
     corresponding income thresholds are twice those values. 
     Because of a provision in the ACA, the income thresholds for 
     both Medicare Part B and Part D are frozen through 2019.
     House bill
       Sections 5601 and 5602 would increase the applicable 
     premium percentage higher income beneficiaries would pay by 
     15 percent such that the levels would become 40.25 percent, 
     57.5 percent, 74.75 percent, and 90 percent in 2017. This 
     provision would also reduce the income thresholds in 2017, to 
     $80,000, $100,000, $150,000 and $200,000 for single filers 
     (and twice those values for married couples) and extend the 
     freeze of the income thresholds beyond 2019, until 25 percent 
     of all beneficiaries are paying higher income premiums.
     Senate bill
       No provision.
     Conference substitute
       No provision.

                             TAX PROVISIONS

  A. Extension of Payroll Tax Reduction (sec. 2001 of the House bill, 
   sec. 101 of the Senate amendment, and sec. 1001 of the conference 
                               agreement)


                              Present Law

     Federal Insurance Contributions Act (``FICA'') tax
       The FICA tax applies to employers based on the amount of 
     covered wages paid to an employee during the year.\1\ 
     Generally, covered wages means all remuneration for 
     employment, including the cash value of all remuneration paid 
     in any medium other than cash.\2\ Certain exceptions from 
     covered wages are also provided. The tax imposed is composed 
     of two parts: (1) the old age, survivors, and disability 
     insurance (``OASDI'') tax equal to 6.2 percent of covered 
     wages up to the taxable wage base ($106,800 for 2011 and 
     $110,100 for 2012); and (2) the Medicare hospital insurance 
     (``HI'') tax amount equal to 1.45 percent of covered wages.
---------------------------------------------------------------------------
     \1\ Sec. 3111.
     \2\ Sec. 3121(a).
---------------------------------------------------------------------------
       In addition to the tax on employers, each employee is 
     generally subject to FICA taxes equal to the amount of tax 
     imposed on the employer (the ``employee portion'').\3\ The 
     employee portion of FICA taxes generally must be withheld and 
     remitted to the Federal government by the employer.
---------------------------------------------------------------------------
     \3\ Sec. 3101. For taxable years beginning after 2012, an 
     additional HI tax applies to certain employees.
---------------------------------------------------------------------------
     Self-Employment Contributions Act (``SECA'') Tax
       As a parallel to FICA taxes, the SECA tax applies to the 
     self-employment income of self-employed individuals.\4\ The 
     rate of the OASDI portion of SECA taxes is generally 12.4 
     percent, which is equal to the combined employee and employer 
     OASDI FICA tax rates, and applies to self-employment income 
     up to the FICA taxable wage base. Similarly, the rate of the 
     HI portion of SECA tax is 2.9 percent, the same as the 
     combined employer and employee HI rates under the FICA tax, 
     and there is no cap on the amount of self-employment income 
     to which the rate applies.\5\
---------------------------------------------------------------------------
     \4\ Sec. 1401.
     \5\ For taxable years beginning after 2012, an additional HI 
     tax applies to certain self-employed individuals.
---------------------------------------------------------------------------
       An individual may deduct, in determining net earnings from 
     self-employment under the SECA tax, the amount of the net 
     earnings from self-employment (determined without regard to 
     this deduction) for the taxable year multiplied by one half 
     of the combined OASDI and HI rates.\6\
---------------------------------------------------------------------------
     \6\ Sec. 1402(a)(12).
---------------------------------------------------------------------------
       Additionally, a deduction, for purposes of computing the 
     income tax of an individual, is allowed for one-half of the 
     amount of the SECA tax imposed on the individual's self-
     employment income for the taxable year.\7\
---------------------------------------------------------------------------
     \7\ Sec. 164(f).
---------------------------------------------------------------------------
     Railroad retirement tax
       Instead of FICA taxes, railroad employers and employees are 
     subject, under the Railroad Retirement Tax Act (``RRTA''), to 
     taxes equivalent to the OASDI and HI taxes under FICA.\8\ The 
     employee portion of RRTA taxes generally must be withheld and 
     remitted to the Federal government by the employer.
---------------------------------------------------------------------------
     \8\ Secs. 3201(a) and 3211(a).
---------------------------------------------------------------------------
     Temporary reduced OASDI rates
       Under the Tax Relief, Unemployment Insurance 
     Reauthorization, and Job Creation Act of 2010,\9\ for 2011, 
     the OASDI rate for the employee portion of the FICA tax, and 
     the equivalent employee portion of the RRTA tax, is reduced 
     by two percentage points to 4.2 percent. Similarly, for 
     taxable years beginning in 2011, the OASDI rate for a self-
     employed individual is reduced by two percentage points to 
     10.4 percent.
---------------------------------------------------------------------------
     \9\ Pub. L. No. 111 312.
---------------------------------------------------------------------------
       Special rules coordinate the SECA tax rate reduction with a 
     self-employed individual's deduction in determining net 
     earnings from self-employment under the SECA tax and the 
     income tax deduction for one-half of the SECA tax. The rate 
     reduction is not taken into account in determining the SECA 
     tax deduction allowed for determining the amount of the net 
     earnings from self-employment for the taxable year. The 
     income tax deduction allowed for the SECA tax for taxable 
     years beginning in 2011 is 59.6 percent of the OASDI portion 
     of the SECA tax imposed for the taxable year plus one-half of 
     the HI portion of the SECA tax imposed for the taxable 
     year.\10\
---------------------------------------------------------------------------
     \10\ This percentage replaces the rate of one half (50 
     percent) otherwise allowed for this portion of the deduction. 
     The percentage is necessary to allow the self-employed 
     individual to deduct the full amount of the employer portion 
     of SECA taxes. The employer OASDI tax rate remains at 6.2 
     percent, while the employee portion falls to 4.2 percent. 
     Thus, the employer share of total OASDI taxes is 6.2 divided 
     by 10.4, or 59.6 percent of the OASDI portion of SECA taxes.
---------------------------------------------------------------------------
       The Federal Old-Age and Survivors Trust Fund, the Federal 
     Disability Insurance Trust Fund and the Social Security 
     Equivalent Benefit Account established under the Railroad 
     Retirement Act of 1974 \11\ receive transfers from the 
     General Fund of the United States Treasury equal to any 
     reduction in payroll taxes attributable to the rate reduction 
     for 2011. The amounts are transferred from the General Fund 
     at such times and in such a manner as to replicate to the 
     extent possible the transfers which would have occurred to 
     the Trust Funds or Benefit Account had the provision not been 
     enacted.
---------------------------------------------------------------------------
     \11\ 45 U.S.C. 231n 1(a).
---------------------------------------------------------------------------
       For purposes of applying any provision of Federal law other 
     than the provisions of the Internal Revenue Code of 1986, the 
     employee rate of OASDI tax is determined without regard to 
     the reduced rate for 2011.
       Under the Temporary Payroll Tax Cut Continuation Act of 
     2011,\12\ the reduced employee OASDI tax rate of 4.2 percent 
     under the FICA tax, and the equivalent employee portion of 
     the RRTA tax, is extended to apply to covered wages paid in 
     the first two months of 2012. A recapture applies for any 
     benefit a taxpayer may have received from the reduction in 
     the OASDI tax rate, and the equivalent employee portion of 
     the RRTA tax, for remuneration received during the first two 
     months of 2012 in excess of $18,350.\13\ The recapture is 
     accomplished by a tax equal to two percent of the amount of 
     wages (and railroad compensation) received during the first 
     two months of 2012 that exceed $18,350. The Secretary of the 
     Treasury (or the Secretary's delegate) is to prescribe 
     regulations or other guidance that is necessary and 
     appropriate to carry out this provision.
---------------------------------------------------------------------------
     \12\ Pub. L. No. 112 78, enacted after passage of H.R. 3630 
     by the House of Representatives and the Senate.
     \13\ $18,350 is 1/6 of the 2012 taxable wage base of 
     $110,100.
---------------------------------------------------------------------------
       In addition, for taxable years beginning in 2012, the OASDI 
     rate for a self-employed individual is reduced to 10.4 
     percent, for self-employment income of up to $18,350 (reduced 
     by wages subject to the lower OASDI rate for 2012). Related 
     rules for 2011 concerning coordination of a self-employed 
     individual's deductions in determining net earnings from

[[Page H876]]

     self-employment and income tax also apply for 2012, except 
     that the income tax deduction allowed for the OASDI portion 
     of SECA tax imposed for taxable years beginning in 2012 is 
     computed at the rate of 59.6 percent \14\ of the OASDI 
     portion of the SECA tax imposed on self-employment income of 
     up to $18,350. For self-employment income in excess of this 
     amount, the deduction is equal to half of the OASDI portion 
     of the SECA tax.
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     \14\ This percentage used with respect to the first $18,350 
     of self-employment income is necessary to continue to allow 
     the self-employed taxpayer to deduct the full amount of the 
     employer portion of SECA taxes. The employer OASDI tax rate 
     remains at 6.2 percent, while the employee portion falls to a 
     4.2 percent rate for the first $18,350 of self-employment 
     income. Thus, the employer share of total OASDI taxes is 6.2 
     divided by 10.4, or 59.6 percent of the OASDI portion of SECA 
     taxes, for the first $18,350 of self-employment income.
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       Rules related to the OASDI rate reduction for 2011 
     concerning (1) transfers to the Federal Old-Age and Survivors 
     Trust Fund, the Federal Disability Insurance Trust Fund and 
     the Social Security Equivalent Benefit Account established 
     under the Railroad Retirement Act of 1974, and (2) 
     determining the employee rate of OASDI tax in applying 
     provisions of Federal law other than the Code also apply for 
     2012.


                            House Bill \15\
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     \15\ The House bill passed prior to the enactment of the 
     ``Temporary Payroll Tax Cut Continuation Act of 2011'', Pub. 
     L. No. 112 78, described above.
---------------------------------------------------------------------------
       Under the House bill, the reduced employee OASDI tax rate 
     of 4.2 percent under the FICA tax, and the equivalent portion 
     of the RRTA tax, is extended to apply for 2012. Similarly, a 
     reduced OASDI tax rate of 10.4 percent under the SECA tax, is 
     extended to apply for taxable years beginning in 2012.
       Related rules concerning (1) coordination of a self-
     employed individual's deductions in determining net earnings 
     from self-employment and income tax, (2) transfers to the 
     Federal Old-Age and Survivors Trust Fund, the Federal 
     Disability Insurance Trust Fund and the Social Security 
     Equivalent Benefit Account established under the Railroad 
     Retirement Act of 1974, and (3) determining the employee rate 
     of OASDI tax in applying provisions of Federal law other than 
     the Code also apply for 2012.
       Effective date.--The provision applies to remuneration 
     received, and taxable years beginning, after December 31, 
     2011.


                         Senate Amendment \16\
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     \16\ The Senate amendment passed prior to the enactment of 
     the ``Temporary Payroll Tax Cut Continuation Act of 2011'', 
     Pub. L. No. 112 78, described above.
---------------------------------------------------------------------------
       Under the Senate amendment, the reduced employee OASDI tax 
     rate of 4.2 percent under the FICA tax, and the equivalent 
     employee portion of the RRTA tax, applies to covered wages 
     paid up to $18,350 in the first two months of 2012.\17\
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     \17\ $18,350 is \1/6\ of the 2012 taxable wage base of 
     $110,100.
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       In addition, for taxable years beginning in 2012, the 
     Senate amendment provides that the OASDI rate for a self-
     employed individual is reduced to 10.4 percent, for self-
     employment income of up to $18,350 (reduced by wages subject 
     to the lower OASDI rate for 2012). Related rules for 2011 
     concerning coordination of a self-employed individual's 
     deductions in determining net earnings from self-employment 
     and income tax also apply for 2012, except that the income 
     tax deduction allowed for the OASDI portion of SECA tax 
     imposed for taxable years beginning in 2012 is computed at 
     the rate of 59.6 percent \18\ of the OASDI portion of the 
     SECA tax imposed on self-employment income of up to $18,350. 
     For self-employment income in excess of this amount, the 
     deduction is equal to half of the OASDI portion of the SECA 
     tax.
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     \18\ See footnote 14.
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       The Senate amendment also contains rules related to the 
     OASDI rate reduction for 2011 concerning (1) transfers to the 
     Federal Old-Age and Survivors Trust Fund, the Federal 
     Disability Insurance Trust Fund and the Social Security 
     Equivalent Benefit Account established under the Railroad 
     Retirement Act of 1974, and (2) determining the employee rate 
     of OASDI tax in applying provisions of Federal law other than 
     the Code also apply for 2012.
       Effective date.--The provision applies to remuneration 
     received, and taxable years beginning, after December 31, 
     2011.


                          Conference Agreement

       The conference agreement follows the House bill, providing 
     for a reduced employee OASDI tax rate of 4.2 percent under 
     the FICA tax, and the equivalent potion of the RRTA tax, 
     through 2012. Similarly, a reduced OASDI tax rate of 10.4 
     percent under the SECA tax applies for taxable years 
     beginning in 2012.
       As in the House bill and Senate amendment, related rules 
     concerning (1) coordination of a self-employed individual's 
     deductions in determining net earnings from self-employment 
     and income tax, (2) transfers to the Federal Old-Age and 
     Survivors Trust Fund, the Federal Disability Insurance Trust 
     Fund and the Social Security Equivalent Benefit Account 
     established under the Railroad Retirement Act of 1974, and 
     (3) determining the employee rate of OASDI tax in applying 
     provisions of Federal law other than the Code also apply for 
     2012.
       The conference agreement repeals the present-law recapture 
     provision applicable to a taxpayer who receives the reduced 
     OASDI rate with respect to more than $18,350 of wages (or 
     railroad compensation) received during the first two months 
     of 2012, and removes the $18,350 limitation on self-
     employment income subject to the lower rate for taxable years 
     beginning in 2012.
       Effective date.--The provision applies to remuneration 
     received, and taxable years beginning, after December 31, 
     2011.

 B. Repeal of Certain Shifts in the Timing of Corporate Estimated Tax 
 Payments (sec. 6001 of the House bill and sec. 7001 of the conference 
                               agreement)


                              Present Law

       In general, corporations are required to make quarterly 
     estimated tax payments of their income tax liability.\19\ For 
     a corporate whose taxable year is a calendar year, these 
     estimated payments must be made by April 15, June 15, 
     September 15, and December 15. In the case of a corporation 
     with assets of at least $1 billion (determined as of the end 
     of the preceding taxable year):
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     \19\ Sec. 6655.
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       (i) payments due in July, August or September, 2012, are 
     increased to 100.5 percent of the payment otherwise due; \20\
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     \20\ United States-Korea Free Trade Agreement Implementation 
     Act, Pub. L. No. 112 41, sec 505, and United States-Panama 
     Trade Promotion Agreement Implementation Act of 2011, Pub. L. 
     No. 112 43, sec 502.
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       (ii) payments due in July, August, or September, 2014, are 
     increased to 174.25 percent of the payment otherwise due; 
     \21\
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     \21\ Haiti Economic Lift Program of 2010, Pub. L. No. 111 
     171, sec. 12(a); Health Care and Education Reconciliation Act 
     of 2010, Pub. L. No. 111 152, sec. 1410; Hiring Incentives to 
     Restore Employment Act, Pub. L. No. 111 147, sec. 561 (1); 
     Act to extend the Generalized System of Preferences and the 
     Andean Trade Preference Act, and for other purposes, Pub. L. 
     No. 111 124, sec. 4; Worker, Homeownership, and Business 
     Assistance Act of 2009, Pub. L. No. 111 92, sec. 18; Joint 
     resolution approving the renewal of import restrictions 
     contained in the Burmese Freedom and Democracy Act of 2003, 
     and for other purposes, Pub. L. No. 111 42, sec. 202(b)(1).
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       (iii) payments due in July, August or September, 2015, are 
     increased to 163.75 percent of the payment otherwise due; 
     \22\
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     \22\ Omnibus Trade Act of 2010, Pub. L. No. 111 344, sec. 
     10002; Small Business Jobs Act of 2010, Pub. L. No. 111 240, 
     sec. 2131; Firearms Excise Tax Improvements Act of 2010, Pub. 
     L. No. 111 237, sec. 4(a); United States Manufacturing 
     Enhancement Act of 2010, Pub. L. No. 111 227, sec. 4002; 
     Joint resolution approving the renewal of import restrictions 
     contained in the Burmese Freedom and Democracy Act of 2003, 
     and for other purposes, No. 111 210, sec. 3; Haiti Economic 
     Lift Program of 2010, Pub. L. No. 111 171, sec. 12(b); Hiring 
     Incentives to Restore Employment Act, Pub. L. No. 111 147, 
     sec. 561(2).
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       (iv) payments due in July, August, or September 2016 are 
     increased to 103.5 percent of the payment otherwise due; and 
     \23\
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     \23\ United States-Korea Free Trade Agreement Implementation 
     Act, Pub. L. No. 112 41, sec 505; United States-Columbia 
     Trade Promotion Agreement Implementation Act, Pub. L. No. 112 
     42, sec 603; and United States-Panama Trade Promotion 
     Agreement Implementation Act, Pub. L. No. 112 43, sec 502.
---------------------------------------------------------------------------
       (v) payments due in July, August or September, 2019, are 
     increased to 106.50 percent of the payment otherwise due.\24\
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     \24\ Hiring Incentives to Restore Employment Act, Pub. L. No. 
     111 147, sec. 561(3).
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                               House Bill

       The House bill reduces the applicable percentage for 2012 
     (100.5 percent), 2014 (174.25 percent), 2015 (163.75 
     percent), 2016 (103.5 percent), and 2019 (106.5 percent) to 
     100 percent. Thus corporations will make estimated tax 
     payments in 2012, 2014, 2015, 2016, and 2019 as if the prior 
     legislation had never been enacted or amended.
       Effective date.--The provision is effective on the date of 
     enactment.


                            Senate Provision

       No provision.


                          Conference Agreement

       The conference agreement follows the House bill, providing 
     reductions in the applicable percentages for 2012 (100.5 
     percent), 2014 (174.25 percent), 2015 (163.75 percent), 2016 
     (103.5 percent), and 2019 (106.5 percent) to 100 percent. 
     Thus corporations will be required to make estimated tax 
     payments in 2012, 2014, 2015, 2016, and 2019 as if the prior 
     legislation had never been enacted or amended.

  C. Extension of 100 Percent Bonus Depreciation (sec. 1201(a) of the 
       House bill and secs. 168(k)(5) and 460(c)(6) of the Code)


                              Present Law

       An additional first-year depreciation deduction is allowed 
     equal to 50 percent of the adjusted basis of qualified 
     property placed in service between January 1, 2008 and 
     September 8, 2010 or between January 1, 2012 and January 1, 
     2013 (January 1, 2014 for certain longer-lived and 
     transportation property).\25\ An additional first-year 
     depreciation deduction is allowed equal to 100 percent of the 
     adjusted basis of qualified property if it meets the 
     requirements for the additional first-year depreciation and 
     also meets the following requirements. First, the taxpayer 
     must acquire the property after September 8, 2010 and before 
     January 1, 2012. Second, the taxpayer must place the property 
     in service after September 8, 2010 and before January 1, 2012 
     (before January 1, 2013 in the case of certain longer-lived 
     and transportation property). Third, the original use of the 
     property must commence with the taxpayer after September 8, 
     2010.\26\
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     \25\ Sec. 168(k). The additional first-year depreciation 
     deduction is subject to the general rules regarding whether 
     an item must be capitalized under section 263 or section 
     263A.
     \26\ See Rev. Proc. 2011 26, 2011 16 I.R.B. 664 (Apr. 18, 
     2011) for guidance regarding additional first-year 
     depreciation.

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[[Page H877]]

       The additional first-year depreciation deduction is allowed 
     for both regular tax and alternative minimum tax purposes, 
     but is not allowed for purposes of computing earnings and 
     profits. The basis of the property and the depreciation 
     allowances in the year of purchase and later years are 
     appropriately adjusted to reflect the additional first-year 
     depreciation deduction. In addition, there are no adjustments 
     to the allowable amount of depreciation for purposes of 
     computing a taxpayer's alternative minimum taxable income 
     with respect to property to which the provision applies. The 
     amount of the additional first-year depreciation deduction is 
     not affected by a short taxable year. The taxpayer may elect 
     out of additional first-year depreciation for any class of 
     property for any taxable year.
       The interaction of the additional first-year depreciation 
     allowance with the otherwise applicable depreciation 
     allowance may be illustrated as follows. Assume that in 2009, 
     a taxpayer purchased new depreciable property and placed it 
     in service.\27\ The property's cost is $1,000, and it is 
     five-year property subject to the half-year convention. The 
     amount of additional first-year depreciation allowed is $500. 
     The remaining $500 of the cost of the property is depreciable 
     under the rules applicable to five-year property. Thus, 20 
     percent, or $100, is also allowed as a depreciation deduction 
     in 2009. The total depreciation deduction with respect to the 
     property for 2009 is $600. The remaining $400 adjusted basis 
     of the property generally is recovered through otherwise 
     applicable depreciation rules.
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     \27\ Assume that the cost of the property is not eligible for 
     expensing under section 179.
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       Property qualifying for the additional first-year 
     depreciation deduction must meet all of the following 
     requirements. First, the property must be (1) property to 
     which MACRS applies with an applicable recovery period of 20 
     years or less; (2) water utility property (as defined in 
     section 168(e)(5)); (3) computer software other than computer 
     software covered by section 197; or (4) qualified leasehold 
     improvement property (as defined in section 168(k)(3)).\28\ 
     Second, the original use \29\ of the property must commence 
     with the taxpayer after December 31, 2007.\30\ Third, the 
     taxpayer must acquire the property within the applicable time 
     period (as described below). Finally, the property must be 
     placed in service before January 1, 2013. An extension of the 
     placed-in-service date of one year (i.e., January 1, 2014) is 
     provided for certain property with a recovery period of 10 
     years or longer and certain transportation property.\31\ 
     Transportation property generally is defined as tangible 
     personal property used in the trade or business of 
     transporting persons or property.\32\
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     \28\ The additional first-year depreciation deduction is not 
     available for any property that is required to be depreciated 
     under the alternative depreciation system of MACRS. The 
     additional first-year depreciation deduction is also not 
     available for qualified New York Liberty Zone leasehold 
     improvement property as defined in section 1400L(c)(2).
     \29\ The term ``original use'' means the first use to which 
     the property is put, whether or not such use corresponds to 
     the use of such property by the taxpayer. If in the normal 
     course of its business a taxpayer sells fractional interests 
     in property to unrelated third parties, then the original use 
     of such property begins with the first user of each 
     fractional interest (i.e., each fractional owner is 
     considered the original user of its proportionate share of 
     the property).
     \30\ A special rule applies in the case of certain leased 
     property. In the case of any property that is originally 
     placed in service by a person and that is sold to the 
     taxpayer and leased back to such person by the taxpayer 
     within three months after the date that the property was 
     placed in service, the property would be treated as 
     originally placed in service by the taxpayer not earlier than 
     the date that the property is used under the leaseback. If 
     property is originally placed in service by a lessor, such 
     property is sold within three months after the date that the 
     property was placed in service, and the user of such property 
     does not change, then the property is treated as originally 
     placed in service by the taxpayer not earlier than the date 
     of such sale.
     \31\ Property qualifying for the extended placed-in-service 
     date must have an estimated production period exceeding one 
     year and a cost exceeding $1 million.
     \32\ Certain aircraft which is not transportation property, 
     other than for agricultural or firefighting uses, also 
     qualifies for the extended placed-in-service date, if at the 
     time of the contract for purchase, the purchaser made a 
     nonrefundable deposit of the lesser of 10 percent of the cost 
     or $100,000, and which has an estimated production period 
     exceeding four months and a cost exceeding $200,000.
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       To qualify, property must be acquired (1) after December 
     31, 2007, and before January 1, 2013, but only if no binding 
     written contract for the acquisition is in effect before 
     January 1, 2008, or (2) pursuant to a binding written 
     contract which was entered into after December 31, 2007, and 
     before January 1, 2013.\33\ With respect to property that is 
     manufactured, constructed, or produced by the taxpayer for 
     use by the taxpayer, the taxpayer must begin the manufacture, 
     construction, or production of the property after December 
     31, 2007, and before January 1, 2013. Property that is 
     manufactured, constructed, or produced for the taxpayer by 
     another person under a contract that is entered into prior to 
     the manufacture, construction, or production of the property 
     is considered to be manufactured, constructed, or produced by 
     the taxpayer. For property eligible for the extended placed-
     in-service date, a special rule limits the amount of costs 
     eligible for the additional first-year depreciation. With 
     respect to such property, only the portion of the basis that 
     is properly attributable to the costs incurred before January 
     1, 2013 (``progress expenditures'') is eligible for the 
     additional first-year depreciation deduction.\34\
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     \33\ Property does not fail to qualify for the additional 
     first-year depreciation merely because a binding written 
     contract to acquire a component of the property is in effect 
     prior to January 1, 2008.
     \34\ For purposes of determining the amount of eligible 
     progress expenditures, it is intended that rules similar to 
     section 46(d)(3) as in effect prior to the Tax Reform Act of 
     1986, Pub. L. No. 99 514, apply.
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       Property does not qualify for the additional first-year 
     depreciation deduction when the user of such property (or a 
     related party) would not have been eligible for the 
     additional first-year depreciation deduction if the user (or 
     a related party) were treated as the owner. For example, if a 
     taxpayer sells to a related party property that was under 
     construction prior to January 1, 2008, the property does not 
     qualify for the additional first-year depreciation deduction. 
     Similarly, if a taxpayer sells to a related party property 
     that was subject to a binding written contract prior to 
     January 1, 2008, the property does not qualify for the 
     additional first-year depreciation deduction. As a further 
     example, if a taxpayer (the lessee) sells property in a sale-
     leaseback arrangement, and the property otherwise would not 
     have qualified for the additional first-year depreciation 
     deduction if it were owned by the taxpayer-lessee, then the 
     lessor is not entitled to the additional first-year 
     depreciation deduction.
       The limitation under section 280F on the amount of 
     depreciation deductions allowed with respect to certain 
     passenger automobiles is increased in the first year by 
     $8,000 for automobiles that qualify (and for which the 
     taxpayer does not elect out of the additional first-year 
     deduction). The $8,000 increase is not indexed for inflation.
     Percentage-of-completion method
       In general, in the case of a long-term contract, the 
     taxable income from the contract is determined under the 
     percentage-of-completion method. Solely for purposes of 
     determining the percentage of completion under section 
     460(b)(1)(A), the cost of qualified property with a MACRS 
     recovery period of seven years or less is taken into account 
     as a cost allocated to the contract as if bonus depreciation 
     had not been enacted for property placed in service after 
     December 31, 2009 and before January 1, 2011 (January 1, 
     2012, for certain longer-lived and transportation property). 
     Bonus depreciation is taken into account in determining 
     taxable income under the percentage-of-completion method for 
     property placed in service after December 31, 2010.


                               House Bill

       The House bill increases the additional first-year 
     depreciation deduction from 50 percent to 100 percent of the 
     adjusted basis of qualified property placed in service after 
     December 31, 2011, and before January 1, 2013 (January 1, 
     2014, for certain longer-lived and transportation property).
       The provision provides that solely for purposes of 
     determining the percentage of completion under section 
     460(b)(1)(A), the cost of qualified property with a MACRS 
     recovery period of seven years or less which is placed in 
     service after December 31, 2011, and before January 1, 2013 
     (January 1, 2014, for certain longer-lived and transportation 
     property) is taken into account as a cost allocated to the 
     contract as if bonus depreciation had not been enacted.
       Effective date.--The provision applies to property placed 
     in service after December 31, 2011.


                            Senate Amendment

       No provision.


                          Conference Agreement

       The conference agreement does not include the provision 
     from the House bill.

  D. Expansion of Election to Accelerate AMT Credits in Lieu of Bonus 
Depreciation (sec. 1201(b) of the House bill and sec. 168(k)(4) of the 
                                 Code)


                              Present Law

       A corporation may elect to claim additional alternative 
     minimum tax (``AMT'') credits in lieu of claiming additional 
     first year depreciation (``bonus depreciation'') on eligible 
     qualified property \35\ placed in service after December 31, 
     2010, and before January 1, 2013 (January 1, 2014, in the 
     case of certain longer-lived property and transportation 
     property).\36\ A corporation making the election (i) forgoes 
     bonus depreciation for eligible qualified property, (ii) uses 
     the straight-line method of depreciation for eligible 
     qualified property, and (iii) increases the limitation on the 
     allowance of AMT credit by the bonus depreciation amount.\37\ 
     The increase in the allowable AMT credit by reason of the 
     election is treated as refundable.
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     \35\ The term ``eligible qualified property'' means property 
     eligible for bonus depreciation, with minor effective date 
     differences.
     \36\ Sec. 168(k)(4).
     \37\ Sec. 53(c) otherwise limits the allowable AMT credit for 
     a taxable year to the excess of the regular tax liability 
     (reduced by certain credits) over the tentative minimum tax 
     for the taxable year.
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       The bonus depreciation amount is 20 percent of the 
     difference between (i) the aggregate amount of depreciation 
     for all eligible qualified property placed in service by the 
     corporation that would be allowed if bonus depreciation 
     applied using the most accelerated depreciation method 
     (determined without regard to this provision), and shortest 
     life allowable for each property, and (ii) the amount of 
     depreciation that would be allowed if bonus depreciation did 
     not apply using the same method and life for each property.

[[Page H878]]

       The bonus depreciation amount for any taxable year is 
     limited to the lesser of (i) $30 million, or (ii) six percent 
     of the AMT credit for the year attributable to the adjusted 
     net minimum tax for taxable years beginning before January 1, 
     2006 (determined by treating credits as allowed on a first-
     in, first-out basis), reduced by the sum of certain bonus 
     depreciation amounts for prior taxable years.
       In the case of an electing corporation that is a partner in 
     a partnership, the corporation's distributive share of 
     partnership items is determined without regard to bonus 
     depreciation and by using the straight-line method of 
     depreciation. No partnership property is taken into account 
     in determining a corporation's bonus depreciation amount.
       Generally an election under this provision for a taxable 
     year applies to subsequent taxable years.
       All corporations treated as a single employer under section 
     52(a) are treated as one taxpayer for purposes of the 
     provision and are treated as having made an election under 
     this provision if any of the corporations so elects.


                               House Bill

       The House bill revises the provision allowing a corporation 
     to elect to claim additional AMT credits in lieu of bonus 
     depreciation.\38\ The House bill provision follows the 
     substance of present law with the following changes:
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     \38\ The House bill rewrites section 168(k)(4) in order to 
     delete a substantial amount of ``deadwood'' from the language 
     of present law.
---------------------------------------------------------------------------
       Under the House bill, the bonus depreciation amount for any 
     taxable year is limited to the lesser of (i) the AMT credit 
     for the year attributable to the adjusted net minimum tax for 
     taxable years ending before January 1, 2012 (determined by 
     treating credits as allowed on a first-in, first-out basis), 
     or (ii) 50 percent of the AMT credit for the first taxable 
     year ending after December 31, 2011.
       In the case of a partnership in which more than 50 percent 
     of the capital and profits interests are owned (directly or 
     indirectly) by one corporation (or by corporations treated as 
     one taxpayer for purposes of this provision), the bonus 
     depreciation amount is computed by treating each partner as 
     having an amount equal to that partner's allocable share of 
     the eligible property for the taxable year (as determined 
     under regulations prescribed by the Secretary).
       A corporation may make a separate election for each taxable 
     year.
       Effective date.--The provision applies to taxable years 
     ending after December 31, 2011.
       For a taxable year which begins before January 1, 2012, and 
     ends after December 31, 2011, the bonus depreciation amount 
     is the sum of the amounts computed separately for each 
     portion of the taxable year by treating each portion as a 
     separate taxable year taking into account property placed in 
     service by the corporation during that portion of the taxable 
     year.


                            Senate Amendment

       No provision.


                          Conference Agreement

       The conference agreement does not include the provision 
     from the House bill.

   E. Adjustments to Maximum Thresholds for Recapturing Overpayments 
Resulting From Certain Federally-subsidized Health Insurance (sec. 2221 
              of the House bill and sec. 36B of the Code)


                              Present Law

     Premium assistance credit
       For taxable years ending after December 31, 2013, section 
     36B provides a refundable tax credit (the ``premium 
     assistance credit'') for eligible individuals and families 
     who purchase health insurance through an American Health 
     Benefit Exchange. The premium assistance credit, which is 
     refundable and payable in advance directly to the insurer, 
     subsidizes the purchase of certain health insurance plans 
     through an American Health Benefit Exchange.
       The premium assistance credit is available for individuals 
     (single or joint filers) with household incomes between 100 
     and 400 percent of the Federal poverty level (``FPL'') for 
     the family size involved who do not receive health insurance 
     through an employer or a spouse's employer.\39\ Household 
     income is defined as the sum of: (1) the taxpayer's modified 
     adjusted gross income, plus (2) the aggregate modified 
     adjusted gross incomes of all other individuals taken into 
     account in determining that taxpayer's family size (but only 
     if such individuals are required to file a tax return for the 
     taxable year). Modified adjusted gross income is defined as 
     adjusted gross income increased by: (1) any amount excluded 
     by section 911 (the exclusion from gross income for citizens 
     or residents living abroad), (2) any tax-exempt interest 
     received or accrued during the tax year, and (3) an amount 
     equal to the portion of the taxpayer's social security 
     benefits (as defined in section 86(d)) that is excluded from 
     income under section 86 (that is, the amount of the 
     taxpayer's Social Security benefits that are excluded from 
     gross income).\40\ To be eligible for the premium assistance 
     credit, taxpayers who are married (within the meaning of 
     section 7703) must file a joint return. Individuals who are 
     listed as dependents on a return are ineligible for the 
     premium assistance credit.
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     \39\ Individuals who are lawfully present in the United 
     States but are not eligible for Medicaid because of their 
     immigration status are treated as having a household income 
     equal to 100 percent of FPL (and thus eligible for the 
     premium assistance credit) as long as their household income 
     does not actually exceed 100 percent of FPL.
     \40\ The definition of modified adjusted gross income used in 
     section 36B is incorporated by reference for purposes of 
     determining eligibility to participate in certain other 
     healthcare-related programs, such as reduced cost-sharing 
     (section 1402 of PPACA)), Medicaid for the nonelderly 
     (section 1902(e) of the Social Security Act (42 U.S.C. 
     1396a(e)) as modified by section 2002(a) of PPACA) and the 
     Children's Health Insurance Program (section 2102(b)(1)(B) of 
     the Social Security Act (42 U.S.C. 1397bb(b)(1)(B)) as 
     modified by section 2101(d) of PPACA).
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       As described in Table 1 below, premium assistance credits 
     are available on a sliding scale basis for individuals and 
     families with household incomes between 100 and 400 percent 
     of FPL to help offset the cost of private health insurance 
     premiums. The premium assistance credit amount is determined 
     based on the percentage of income the cost of premiums 
     represents, rising from two percent of income for those at 
     100 percent of FPL for the family size involved to 9.5 
     percent of income for those at 400 percent of FPL for the 
     family size involved. After 2014, the percentages of income 
     are indexed to the excess of premium growth over income 
     growth for the preceding calendar year. After 2018, if the 
     aggregate amount of premium assistance credits and cost-
     sharing reductions \41\ exceeds 0.504 percent of the gross 
     domestic product for that year, the percentage of income is 
     also adjusted to reflect the excess (if any) of premium 
     growth over the rate of growth in the consumer price index 
     for the preceding calendar year. For purposes of calculating 
     family size, individuals who are in the country illegally are 
     not included.
---------------------------------------------------------------------------
     \41\ As described in section 1402 of PPACA.

            TABLE 1.--THE PREMIUM ASSISTANCE CREDIT PHASE-OUT
------------------------------------------------------------------------
                                              Initial
    Household income  (expressed as a         premium      Final premium
             percent of FPL)               (percentage)    (percentage)
------------------------------------------------------------------------
100% up to 133%.........................            2.0             2.0
133% up to 150%.........................            3.0             4.0
150% up to 200%.........................            4.0             6.3
200% up to 250%.........................            6.3             8.05
250% up to 300%.........................            8.05            9.5
300% up to 400%.........................            9.5             9.5
------------------------------------------------------------------------

     Minimum essential coverage and employer offer of health 
         insurance coverage
       Generally, if an employee is offered minimum essential 
     coverage \42\ in the group market, including employer-
     provided health insurance coverage, the individual is 
     ineligible for the premium assistance credit for health 
     insurance purchased through an exchange.
---------------------------------------------------------------------------
     \42\ As defined in section 5000A(f).
---------------------------------------------------------------------------
       If an employee is offered unaffordable coverage by his or 
     her employer or the plan's share of total allowed cost of 
     provided benefits is less than 60 percent of such costs, the 
     employee can be eligible for the premium assistance credit, 
     but only if the employee declines to enroll in the coverage 
     and satisfies the conditions for receiving a premium 
     assistance credit through an American Health Benefit 
     Exchange. Unaffordable coverage, as defined by Federal law, 
     is coverage with a premium required to be paid by the 
     employee that is more than 9.5 percent of the employee's 
     household income, based on self-only coverage.\43\
---------------------------------------------------------------------------
     \43\ The 9.5 percent amount is indexed for calendar years 
     beginning after 2014 to reflect the excess of premium growth 
     over income growth.
---------------------------------------------------------------------------
     Reconciliation
       If the premium assistance credit received through advance 
     payment exceeds the amount of premium assistance credit to 
     which the taxpayer is entitled for the taxable year, the 
     liability for the overpayment must be reflected on the 
     taxpayer's income tax return for the taxable year subject to 
     a limitation on the amount of such liability. For persons 
     with household income below 400 percent of FPL, the liability 
     for the overpayment for a taxable year is limited to a 
     specific dollar amount (the ``applicable dollar amount'') as 
     shown in Table 2 below (one-half of the applicable dollar 
     amount shown in Table 2 for unmarried individuals who are not 
     surviving spouses or filing as heads of households).\44\
---------------------------------------------------------------------------
     \44\ Section 36B(f)(2), as amended by section 208 of the 
     Medicare and Medicaid Extenders Act of 2010, Pub. L. No. 111 
     309 and section 4 of the Comprehensive 1099 Taxpayer 
     Protection and Repayment of Exchange Subsidy Overpayments Act 
     of 2011, Pub. L. No. 112 9.

                        TABLE 2.--RECONCILIATION
------------------------------------------------------------------------
                                                              Applicable
     Household income  (expressed as a percent of FPL)          dollar
                                                                amount
------------------------------------------------------------------------
Less than 100%.............................................         $600
At least 200% but less than 300%...........................        1,500
At least 300% but less than 400%...........................        2,500
------------------------------------------------------------------------

       If the premium assistance credit for a taxable year 
     received through advance payment is less than the amount of 
     the credit to which the taxpayer is entitled for the year, 
     the shortfall in the credit is also reflected on the 
     taxpayer's tax return for the year.


                               House Bill

       The House bill changes the applicable dollar amount, as 
     shown in Table 3 below (one-half of the applicable dollar 
     amount shown in Table 3 for unmarried individuals who are not 
     surviving spouses or filing as heads of households).

[[Page H879]]



                    TABLE 3.--ADJUSTED RECONCILIATION
------------------------------------------------------------------------
                                                              Applicable
     Household income  (expressed as a percent of FPL)          dollar
                                                                amount
------------------------------------------------------------------------
Less than 100%.............................................         $600
At least 100% but less than 150%...........................          800
At least 150% but less than 200%...........................        1,000
At least 200% but less than 250%...........................        1,500
At least 250% but less than 300%...........................        2,200
At least 300% but less than 350%...........................        2,500
At least 350% but less than 400%...........................        3,200
------------------------------------------------------------------------

       Effective date.--The provision is effective on the date of 
     enactment.


                            Senate Amendment

       No provision.


                          Conference Agreement

       The conference agreement does not include the provision 
     from the House bill.

F. Information for Administration of Social Security Provisions Related 
 to Noncovered Employment (sec. 5101 of the House bill and secs. 6047 
                        and 6103(l) of the Code)


                              Present Law

       The administrator of an employer-sponsored retirement plan, 
     including a plan maintained by a State or local government, 
     is required to comply with reporting requirements prescribed 
     by the IRS.\45\ In the case of a distribution to a 
     participant or beneficiary, the amount of the distribution 
     and other required information must be reported to the IRS 
     and the participant or beneficiary on the Form 1099 R.
---------------------------------------------------------------------------
     \45\ Sec. 6047(d).
---------------------------------------------------------------------------
       Tax returns and return information (including information 
     returns) received by the IRS are subject to confidentiality 
     protections and cannot be disclosed, including to another 
     Federal agency, unless specifically authorized.\46\ 
     Disclosure of certain returns and return information to the 
     Social Security Administration for specific purposes is so 
     authorized.\47\
---------------------------------------------------------------------------
     \46\ Sec. 6103.
     \47\ Sec. 6103(h)(5), (l)(1), (l)(5).
---------------------------------------------------------------------------


                               House Bill

       The House bill amends the reporting requirements applicable 
     to employer-sponsored retirement plans of State and local 
     governments to require the identification of any distribution 
     based in whole or in part on earnings for service in the 
     employ of the State or local government, to the extent such 
     information is known or should be known.\48\ The House bill 
     authorizes disclosure of this information by the IRS to the 
     Social Security Administration for purposes of its 
     administration of the Social Security Act.
---------------------------------------------------------------------------
     \48\ For this purpose, State includes the District of 
     Columbia, the Commonwealth of Puerto Rico, the Virgin 
     Islands, Guam and American Samoa.
---------------------------------------------------------------------------
       Effective date.--The provision applies to distributions and 
     disclosures made after December 31, 2012.


                            Senate Amendment

       No provision.


                          Conference Agreement

       The conference agreement does not include the provision 
     from the House bill.

 G. Social Security Number Required to Claim the Refundable Portion of 
 the Child Tax Credit (sec. 5201 of the House bill and sec. 24 of the 
                                 Code)


                              Present Law

       An individual may claim a tax credit for each qualifying 
     child under the age of 17. The maximum amount of the credit 
     per child is $1,000 through 2012 and $500 thereafter. A child 
     who is not a citizen, national, or resident of the United 
     States cannot be a qualifying child. If the child tax credit 
     exceeds the taxpayer's tax liability, the taxpayer may be 
     eligible for a refundable credit.
       No credit is allowed to any taxpayer with respect to any 
     qualifying child unless the taxpayer includes the name and 
     the taxpayer identification number of the qualifying child on 
     the return of tax for the taxable year. For individual 
     filers, a taxpayer identification number may be either a 
     Social Security number (``SSN''), an IRS individual taxpayer 
     identification number (``ITIN''), or an IRS adoption taxpayer 
     identification number (``ATIN'').


                               House Bill

       The House bill adds a requirement that the refundable 
     portion of the child tax credit is allowable only if the tax 
     return includes the taxpayer's SSN (or in the case of a joint 
     return, the SSN of either spouse).
       Effective date.--The provision applies to taxable years 
     beginning after the date of enactment.


                            Senate Amendment

       No provision.


                          Conference Agreement

       The conference agreement does not include the provision 
     from the House bill.

  H. Excise Tax on Unemployment Compensation Benefits of High-Income 
Individuals (sec. 5301 of the House bill and new sec. 5895 of the Code)


                              Present Law

       Gross income includes any unemployment compensation 
     benefits received under the laws of the United States or any 
     State, and is taxed at the applicable individual income tax 
     rate.\49\
---------------------------------------------------------------------------
     \49\ Sec. 85.
---------------------------------------------------------------------------


                               House Bill

       The House bill imposes an excise tax equal to 100 percent 
     on unemployment compensation benefits received by individuals 
     with adjusted gross income above certain thresholds. The 
     adjusted gross income threshold is $750,000 ($1,500,000 for 
     married individuals filing joint returns). The excise tax is 
     phased-in ratably over a $250,000 range ($500,000 for married 
     individuals filing joint returns). Therefore unemployment 
     compensation benefits are taxed at a 100 percent rate for 
     individuals with $1,000,000 or more of adjusted gross income 
     ($2,000,000 or more of adjusted gross income for married 
     individuals filing joint returns).
       The excise tax is not deductible in computing the 
     taxpayer's taxable income.
       Effective date.--The provision applies to taxable years 
     beginning after December 31, 2011.


                            Senate Amendment

       No provision.


                          Conference Agreement

       The conference agreement does not include the provision 
     from the House bill.

                        TAX COMPLEXITY ANALYSES

       The following tax complexity analysis is provided pursuant 
     to section 4022(b) of the Internal Revenue Service Reform and 
     Restructuring Act of 1998, which requires the staff of the 
     Joint Committee on Taxation (in consultation with the 
     Internal Revenue Service (``IRS'') and the Treasury 
     Department) to provide a complexity analysis of tax 
     legislation reported by the House Committee on Ways and 
     Means, the Senate Committee on Finance, or a Conference 
     Report containing tax provisions. The complexity analysis is 
     required to report on the complexity and administrative 
     issues raised by provisions that directly or indirectly amend 
     the Internal Revenue Code and that have widespread 
     applicability to individuals or small businesses. For each 
     such provision identified by the staff of the Joint Committee 
     on Taxation, a summary description of the provision is 
     provided along with an estimate of the number and type of 
     affected taxpayers, and a discussion regarding the relevant 
     complexity and administrative issues.
       Following the analysis of the staff of the Joint Committee 
     on Taxation are the comments of the IRS and the Treasury 
     Department regarding each of the provisions included in the 
     complexity analysis, including a discussion of the likely 
     effect on IRS forms and any expected impact on the IRS.


1. Extension of the payroll tax reduction (sec. 1001 of the conference 
                               agreement)

     Summary description of provision
       The conference agreement provides for a reduced employee 
     OASDI tax rate of 4.2 percent under the FICA tax, and the 
     equivalent portion of the RRTA tax, through 2012. Similarly, 
     the reduced OASDI tax rate of 10.4 percent under the SECA 
     tax, is extended to apply for taxable years of self-employed 
     individuals that begin in 2012.
       Related rules concerning (1) coordination of a self-
     employed individual's deductions in determining net earnings 
     from self-employment and income tax, (2) transfers to the 
     Federal Old-Age and Survivors Trust Fund, the Federal 
     Disability Insurance Trust Fund and the Social Security 
     Equivalent Benefit Account established under the Railroad 
     Retirement Act of 1974, and (3) determining the employee rate 
     of OASDI tax in applying provisions of Federal law other than 
     the Code also apply for 2012.
       The conference agreement repeals the present-law recapture 
     provision applicable to a taxpayer who receives the reduced 
     OASDI rate with respect to more than $18,350 of wages 
     received during the first two months of 2012.
       The bill is effective after the date of enactment.
     Number of affected taxpayers
       It is estimated that the provision will affect more than 10 
     percent of individual taxpayers and small businesses.
     Discussion
       It is not anticipated that taxpayers and small businesses 
     will need to keep additional records due to this provision. 
     Extensive additional regulatory guidance will not be 
     necessary to effectively implement the provision. It is not 
     anticipated that the provision will result in an increase in 
     disputes between small businesses and the IRS.
       The provision likely will not increase the tax preparation 
     costs for most individuals and small businesses. Affected 
     individuals and small businesses will not be required to 
     perform additional and complex calculations to comply with 
     the provision.
       It is anticipated that the Secretary of the Treasury will 
     have to make appropriate revisions to several types of tax 
     forms and instructions.
                                       Department of the Treasury,


                                     Internal Revenue Service,

                                Washington, DC, February 15, 2012.
     Thomas A. Barthold, 
     Chief of Staff, Joint Committee on Taxation,
     Washington, DC
       Dear Mr. Barthold: I am responding to your letter dated 
     February 14, 2012, in which you requested a complexity 
     analysis related to the extension of the payroll tax holiday 
     enacted under section 101 of the Temporary Payroll Tax Cut 
     Continuation Act of 2011.
       Enclosed are the combined comments of the Internal Revenue 
     Service and the Treasury Department for inclusion in the 
     complexity analysis in the Conference Report on H.R. 3630.
       Our comments are based on the description of the provision 
     provided in your letter. The

[[Page H880]]

     analysis does not include administrative cost estimates for 
     the changes that would be required. Due to the short 
     turnaround time, our comments are provisional and subject to 
     change upon a more complete and in-depth analysis of the 
     provision. The analysis does not cover any other provisions 
     of the bill.
           Sincerely,
                                               Douglas H. Shulman.
       Enclosure.

        COMPLEXITY ANALYSIS OF CONFERENCE AGREEMENT ON H.R. 3630


                  Extension of the Payroll Tax Holiday

       The conference agreement provides for a reduced employee 
     OASDI tax rate of 4.2 percent under the FICA tax, and the 
     equivalent portion of the RRTA tax, through 2012. Similarly, 
     the reduced OASDI tax rate of 10.4 percent under the SECA tax 
     is extended for taxable years of self-employed individuals 
     that begin in 2012.
       The agreement provides related rules concerning (1) 
     coordination of a self-employed individual's deductions in 
     determining net earnings from self-employment and income tax, 
     (2) transfers to the Federal Old-Age and Survivors Trust 
     Fund, the Federal Disability Insurance Trust Fund and the 
     Social Security Equivalent Benefit Account established under 
     the Railroad Retirement Act of 1974, and (3) determining the 
     employee rate of OASDI tax in applying provisions of Federal 
     law other than the Code that also apply for 2012.
       The conference agreement repeals the present-law recapture 
     provision applicable to a taxpayer who receives the reduced 
     OASDI rate with respect to more than $18,350 of wages 
     received during the first two months of 2012.


                       IRS and Treasury Comments

        This provision is an extension of current law 
     (except for the repeal of the recapture of excess benefit) 
     and should not add significant burden to taxpayers and the 
     public in general.
        IRS has taken measures to prepare in case the 
     Temporary Payroll Tax Cut is not extended, including revising 
     forms and instructions and programming systems. If this 
     provision is enacted, the IRS will have to adjust its forms 
     and systems to reflect the extension. Computer software 
     providers and large employers may also have programmed their 
     systems for current law and would need to make similar 
     adjustments.
        No new guidance would be required.
        IRS will have to make small modifications to 
     certain notices to, and publications for, employers.
        There will be minimal impact on IRS training and 
     the Internal Revenue Manual.
       Pursuant to clause 9 of rule XXI of the Rules of the House 
     of Representatives, no provision in this conference report or 
     joint explanatory statement includes a congressional earmark, 
     limited tax benefit, or limited tariff benefit.
     Dave Camp,
     Fred Upton,
     Kevin Brady,
     Greg Walden,
     Tom Price,
     Tom Reed,
     Renee L. Ellmers,
     Nan A.S. Hayworth,
     Sander M. Levin,
     Xavier Becerra,
     Chris Van Hollen,
     Allyson Y. Schwartz,
     Henry A. Waxman,
                                Managers on the Part of the House.

     Max Baucus, 
     Jack Reed,
     Benjamin L. Cardin,
     Robert P. Casey, Jr.,
     Managers on the Part of the Senate.

                          ____________________