[House Report 112-87]
[From the U.S. Government Publishing Office]
112th Congress Rept. 112-87
HOUSE OF REPRESENTATIVES
1st Session Part 1
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JOBS ACT OF 2011
_______
May 23, 2011.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Camp, from the Committee on Ways and Means,
submitted the following
R E P O R T
together with
DISSENTING VIEWS
[To accompany H.R. 1745]
[Including cost estimate of the Congressional Budget Office]
The Committee on Ways and Means, to whom was referred the
bill (H.R. 1745) to improve jobs, opportunity, benefits, and
services for unemployed Americans, and for other purposes,
having considered the same, report favorably thereon with an
amendment and recommend that the bill as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Jobs, Opportunity,
Benefits, and Services Act of 2011'' or the ``JOBS Act of 2011''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
TITLE I--REFORMS OF UNEMPLOYMENT COMPENSATION TO PROMOTE WORK AND JOB
CREATION
Sec. 101. Consistent job search requirements.
Sec. 102. Participation in reemployment services made a condition of
benefit receipt.
Sec. 103. State flexibility to promote the reemployment of unemployed
workers.
Sec. 104. Repeal of regulation requiring higher State taxes.
Sec. 105. Restore State flexibility to improve unemployment program
solvency.
Sec. 106. Data standardization for improved data matching.
Sec. 107. Technical and conforming amendments.
TITLE II--FORWARD FUNDING OF REMAINING FEDERAL UNEMPLOYMENT
COMPENSATION FUNDS
Sec. 201. Special transfers to all States.
Sec. 202. Emergency unemployment compensation transition rules.
Sec. 203. Extended benefits program transition rules.
Sec. 204. Emergency designation.
TITLE I--REFORMS OF UNEMPLOYMENT COMPENSATION TO PROMOTE WORK AND JOB
CREATION
SEC. 101. CONSISTENT JOB SEARCH REQUIREMENTS.
(a) In General.--Section 303(a) of the Social Security Act is amended
by adding at the end the following:
``(11)(A) 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) For purposes of this paragraph, the term `actively
seeking work' means, with respect to any individual, that such
individual is actively engaged in a systematic and sustained
effort to obtain work, as determined based on evidence (whether
in electronic format or otherwise) satisfactory to the State
agency charged with the administration of the State law.
``(C) The specific requirements that must be met in order to
satisfy this paragraph shall be established by the State
agency, and shall include at least the following:
``(i) Registration for employment services within 14
days after making initial application for regular
compensation.
``(ii) Posting a resume, record, or other application
for employment on such database as the State agency may
require.
``(iii) Applying, in such manner as the State agency
may require, for work which is similar to that
previously performed by the individual, and which
offers wages comparable to wages for similar work in
the local labor market in which the individual resides
or is 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. 102. PARTICIPATION IN REEMPLOYMENT SERVICES MADE A CONDITION OF
BENEFIT RECEIPT.
(a) Social Security Act.--Paragraph (10) of section 303(a) of the
Social Security Act is amended to read as follows:
``(10)(A) A requirement that, as a condition of eligibility
for regular compensation for any week--
``(i) a claimant shall meet the minimum educational
requirements set forth in subparagraph (B); and
``(ii) any claimant who has been referred to
reemployment services shall participate in such
services.
``(B) For purposes of this paragraph, an individual shall not
be considered to have met the minimum educational requirements
of this subparagraph unless such individual--
``(i) has earned a high school diploma;
``(ii) has earned the General Educational Development
(GED) credential or other State-recognized equivalent
(including by meeting recognized alternative standards
for individuals with disabilities); or
``(iii) is enrolled and making satisfactory progress
in classes leading to satisfaction of clause (ii).
``(C) The requirements of subparagraph (B) may be waived for
an individual to the extent that the State agency charged with
the administration of the State law deems such requirements to
be unduly burdensome in the case of such individual.''.
(b) Internal Revenue Code of 1986.--Paragraph (8) of section 3304(a)
of the Internal Revenue Code of 1986 is amended to read as follows:
``(8) compensation shall not be denied to an individual for
any week in which the individual is enrolled and making
satisfactory progress in education or training which has been
previously approved by the State agency;''.
(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. 103. 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 States submitting 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
establish initial eligibility for 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, at a minimum, 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, 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 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
control or comparison group or other valid methodology,
of the demonstration project; and
``(B) will determine the extent to which the goals
and outcomes described in paragraph (3) were achieved;
and
``(6) assurances that the State will provide any reports
relating to the demonstration project, after its approval, as
the Secretary of Labor may require.
``(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; and
``(2) may not be approved for a period of time greater than 3
years, subject to extension upon request of the Governor of the
State involved for such additional period as the Secretary of
Labor may agree to, except that in no event may a demonstration
project under this section be conducted after the end of the 5-
year period beginning on the date of enactment of this section.
``(e) 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 such 30 days shall be deemed approved, and
public notice of any approval under this sentence shall be provided
within 10 days thereafter.
``(f) The Secretary of Labor may terminate a demonstration project
under this section if the Secretary makes a final determination that
the State has violated the substantive terms or conditions of the
project.''.
SEC. 104. REPEAL OF REGULATION REQUIRING HIGHER STATE TAXES.
(a) In General.--Section 1202(b)(2) of the Social Security Act is
amended--
(1) in subparagraph (A), by inserting ``and'' at the end;
(2) in subparagraph (B), by striking ``, and'' and inserting
a period; and
(3) by striking subparagraph (C).
(b) Effective Date.--The amendments made by subsection (a) shall take
effect as of the date of enactment of this Act.
SEC. 105. RESTORE STATE FLEXIBILITY TO IMPROVE UNEMPLOYMENT PROGRAM
SOLVENCY.
(a) In General.--Subsection (g) of section 4001 of the Supplemental
Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304 note) is
repealed.
(b) Effective Date.--The amendment made by subsection (a) shall take
effect as of the date of enactment of this Act.
SEC. 106. DATA STANDARDIZATION FOR IMPROVED DATA MATCHING.
(a) In General.--Title IX of the Social Security Act is amended by
adding at the end the following:
``data standardization for improved data matching
``Standard Data Elements
``Sec. 911. (a)(1) The Secretary of Labor, in consultation with an
interagency work group established by the Office of Management and
Budget, and considering State perspectives, shall, by rule, designate
standard data elements for any category of information required under
title III or this title.
``(2) The standard data elements designated under paragraph (1)
shall, to the extent practicable, be nonproprietary and interoperable.
``(3) In designating standard data elements 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 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 government perspectives, shall, by rule, designate
data reporting standards to govern the reporting required under title
III or this title.
``(2) The data reporting standards required by paragraph (1) shall,
to the extent practicable--
``(A) incorporate a widely-accepted, non-proprietary,
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 Business
Reporting Language.''.
(b) Effective Date.--The amendment made by this section shall apply
after September 30, 2012 .
SEC. 107. TECHNICAL AND CONFORMING AMENDMENTS.
(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 amended by striking ``may''
and inserting ``shall''.
(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.
TITLE II--FORWARD FUNDING OF REMAINING FEDERAL UNEMPLOYMENT
COMPENSATION FUNDS
SEC. 201. SPECIAL TRANSFERS TO ALL STATES.
(a) Special Transfers in Fiscal Years 2011 and 2012.--Section 903 of
the Social Security Act is amended by adding at the end the following:
``Special Transfers in Fiscal Years 2011 and 2012
``(h)(1) The Secretary of the Treasury shall transfer (as of the
dates determined under paragraph (4)) from the extended unemployment
compensation account to the account of each State in the Unemployment
Trust Fund the amount determined with respect to such State under
paragraph (2).
``(2)(A) The amount to be transferred to a State under this
subsection in any fiscal year is the amount derived by multiplying the
applicable total dollar amount for such fiscal year by the applicable
fraction for such State.
``(B) For purposes of subparagraph (A), the applicable total dollar
amount is--
``(i) for fiscal year 2011, $12,800,000,000; and
``(ii) for fiscal year 2012, $18,200,000,000.
``(C) For purposes of subparagraph (A), the applicable fraction for a
State is a fraction--
``(i) the numerator of which is the total amount of extended
compensation and emergency unemployment compensation paid out
by such State for weeks beginning in the 12-month period
described in clause (ii); and
``(ii) the denominator of which is the total amount of
extended compensation and emergency unemployment compensation
paid out by all States for weeks beginning in the most recent
12-month period for which that information is available for all
States as of May 1, 2011.
``(3)(A) Except as provided in subparagraph (B), amounts transferred
to a State account pursuant to this subsection shall be used only in
the payment of extended compensation and emergency unemployment
compensation, in accordance with applicable provisions of Federal and
State law (including agreements and implementing regulations) as in
effect on May 1, 2011.
``(B) A State may, pursuant to specific legislation enacted by the
legislative body of the State after the date of enactment of the JOBS
Act of 2011, use money transferred to the State account of such State
under this subsection for (i) the payment of unemployment compensation,
(ii) the repayment of advances made to such State under section 1201
(including interest thereon), and (iii) reemployment services designed
to enhance the rapid reemployment of unemployed workers (such as
mandatory workshops, claimant assessments, resume preparation and job
search assistance, wage subsidy programs, eligibility reviews, labor
market information, development of a work-search plan, and training),
if and only if--
``(I) the purposes and amounts are specified in the law;
``(II) the money is withdrawn and expended, for the purpose
described in clause (i), (ii), or (iii) (as the case may be),
after the date of enactment of the law; and
``(III) the use of the money is accounted for in accordance
with standards established by the Secretary of Labor.
``(4) Transfers under this subsection shall--
``(A) to the extent that they relate to the amount set forth
in paragraph (2)(B)(i), be made within 10 days after the date
of enactment of this subsection; and
``(B) to the extent that they relate to the amount set forth
in paragraph (2)(B)(ii), be made after September 30, 2011, and
on or before October 10, 2011.''.
(b) Rule of Construction.--Nothing in section 903(b) of the Social
Security Act shall be considered to apply with respect to any transfer
under section 903(h) of such Act (as amended by this section).
(c) Regulations.--The Secretary of Labor may prescribe any operating
instructions or regulations necessary to carry out this section and the
amendment made by this section.
SEC. 202. EMERGENCY UNEMPLOYMENT COMPENSATION TRANSITION RULES.
(a) Repeal.--Section 4003 of the Supplemental Appropriations Act,
2008 is repealed.
(b) Financing.--Section 4004(e)(1) of the Supplemental Appropriations
Act, 2008 is amended--
(1) in subparagraph (F), by striking ``and'' after the
semicolon; and
(2) by adding after subparagraph (G) the following:
``(H) the amendment made by section 201 of the Jobs,
Opportunity, Benefits, and Services Act of 2011; and''.
(c) Effective Date of Repeal.--
(1) In general.--The amendment made by subsection (a) shall
be effective with respect to weeks ending after July 6, 2011.
(2) Rule of construction.--Nothing in this subsection shall
be considered to affect the reimbursability of any emergency
unemployment compensation paid for a week ending before July 7,
2011.
SEC. 203. EXTENDED BENEFITS PROGRAM TRANSITION RULES.
(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) in subsection (a), by striking ``January 4, 2012'' and
inserting ``July 6, 2011'';
(2) in subsection (b), by striking ``January 4, 2012'' and
inserting ``the date of enactment of the JOBS Act of 2011'';
and
(3) by striking subsection (c).
(b) Termination of Provisions Relating to Temporary Modification of
Extended Benefit Indicators.--Section 203 of the Federal-State Extended
Unemployment Compensation Act of 1970, as amended by section 502 of the
Tax Relief, Unemployment Insurance Reauthorization, and Job Creation
Act of 2010 (Public Law 111-312; 124 Stat. 3307), is amended--
(1) in subsection (d) (in the next to last sentence), by
striking ``December 31, 2011'' and inserting ``June 30, 2011'';
and
(2) in subsection (f)(2), by striking ``December 31, 2011''
and inserting ``June 30, 2011''.
(c) Savings Provision.--In the case of any State law which, as of the
date of enactment of this Act, has been amended in conformance with the
amendments made by subsection (a) or (b) of section 502 of the Tax
Relief, Unemployment Insurance Reauthorization, and Job Creation Act of
2010 (Public Law 111-312; 124 Stat. 3307) and section 2005(a) of the
Assistance for Unemployed Workers and Struggling Families Act (Public
Law 111-5; 26 U.S.C. 3304 note), the amendment made by subsection
(a)(1) shall be disregarded for purposes of any provision of such State
law which provides for a State ``off'' indicator or which otherwise
provides for the termination of an extended benefit period by reason of
the cessation of full Federal funding of sharable extended compensation
or sharable regular compensation.
SEC. 204. EMERGENCY DESIGNATION.
The budgetary effects of this Act are designated as an emergency
requirement and necessary to meet emergency needs pursuant to section
4(g) of the Statutory Pay-As-You-Go Act of 2010.
I. SUMMARY AND BACKGROUND
A. Purpose and Summary
The bill, H.R. 1745, as ordered reported by the Committee
on Ways and Means on May 11, 2011, would make important reforms
to the Unemployment Insurance (UI) program designed to help
more unemployed individuals return to work quickly, while also
giving States new flexibility in using temporary Federal
unemployment program funds. To achieve these purposes, the bill
amends relevant unemployment provisions of the Social Security
Act, the Internal Revenue Code, the Supplemental Appropriations
Act of 2008, the Assistance for Unemployed Workers and
Struggling Families Act, and the Federal-State Extended
Unemployment Compensation Act of 1970.
Specifically, Title I of the legislation includes several
reforms of the UI program designed to promote work, education
and training, and program integrity, while Title II ``forward
funds'' remaining temporary Federal unemployment funds to
States. In Title I, Section 101 sets minimum job search
requirements in all States for the first time. Section 102
requires participation in education and other reemployment
services as a condition of benefit receipt for individuals most
likely to have difficulty returning to work. Section 103 grants
States new flexibility to operate cost-neutral ``waiver''
programs to promote faster returns to work for unemployed
workers. Section 104 repeals a regulation that if left in place
would result in higher State unemployment taxes on jobs in the
years ahead. Section 105 allows States immediate flexibility to
improve unemployment program solvency without having to resort
to raising taxes, repealing a provision enacted in the 2009
stimulus law. Section 106 requires the U.S. Secretary of Labor
to designate standard data elements for any category of
information under Titles III or IX of the Social Security Act,
in order to improve Unemployment Insurance administration
program integrity. Section 107 improves the integrity of
unemployment benefits by directing States to recover more
unemployment benefit overpayments.
Section 201 transfers $31 billion in temporary Federal
unemployment program funds to States in an equitable
distribution to all States while providing new flexibility in
how those funds can be used to assist the unemployed. Given
those transfers, Section 202 provides necessary transition
rules for one of the current Federal programs, the Extended
Unemployment Compensation (EUC) program, while section 203 does
the same for the Federal Extended Benefits (EB) program.
Section 204 provides for an emergency designation related to
the budgetary effects of the bill.
B. Background and the Need for Legislation
On May 5, 2011, Rep. David Camp (R-MI), Chairman of the
House Committee on Ways and Means; Rep. Geoff Davis (R-KY),
Chairman of the Subcommittee on Human Resources of the House
Committee on Ways and Means; and Rep. Rick Berg (R-ND), a
Member of the Subcommittee on Human Resources, introduced H.R.
1745, a bill to improve jobs, opportunity, benefits, and
services for unemployed Americans, and for other purposes. The
Committee on Ways and Means received the referral for the bill
because the bill includes unemployment insurance provisions
that fall within the jurisdiction of the Committee, including
relevant provisions of the Social Security Act (SSA), the
Internal Revenue Code (IRC), the Supplemental Appropriations
Act of 2008, the Assistance for Unemployed Workers and
Struggling Families Act, and the Federal-State Extended
Unemployment Compensation Act of 1970. The Committee found
three primary problems with the existing Unemployment Insurance
system: first, it requires reforms to better help unemployed
Americans prepare for and find jobs; second, rising
unemployment insurance taxes on jobs are hindering job creation
and hiring; and third, current federal funds are both poorly
targeted and lack the flexibility needed to help unemployed
individuals return to work sooner.
C. Legislative History
Background
H.R. 1745 was introduced on May 5, 2011, and was referred
to the Committee on Ways and Means.
Committee action
The Committee on Ways and Means marked up the bill on May
11, 2011, and ordered the bill as amended favorably reported.
Committee hearings
On February 10, 2011, the Subcommittee on Human Resources
of the House Committee on Ways and Means held a hearing on
improving efforts to help unemployed Americans find jobs. On
March 11, 2011, the Subcommittee on Human Resources of the
House Committee on Ways and Means held a hearing on the use of
data matching to improve customer service, program integrity,
and taxpayer savings.
II. EXPLANATION OF THE BILL
TITLE I--REFORMS OF UNEMPLOYMENT COMPENSATION TO PROMOTE WORK AND JOB
CREATION
A. Consistent Job Search Requirements (Sec. 101 of the Bill and Sec.
303(a) of the Social Security Act)
PRESENT 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 for work. 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 is considered as some evidence of availability.
Section 202(a)(3)(A) of the Federal-State Extended
Unemployment Compensation Act of 1970, as amended, does
explicitly require active job search. However, the method of
determining active job search is left to the determination of
the States.
REASONS FOR CHANGE
The Committee believes the lack of a current requirement
that unemployment insurance recipients engage in meaningful job
search, along with minimum standards for what that means, is a
significant omission. The Committee notes that under current
law, in which State and Federal benefits are payable for up to
99 weeks under three separate programs, an explicit work search
requirement applies in only one of those programs--the Extended
Benefits program that generally provides benefits at the end of
a worker's time collecting Unemployment Insurance. This is
exactly backwards--States should expect UI recipients to engage
in effective job searches from the beginning of their time
collecting unemployment benefits, not only at the very end of
their time collecting those benefits. Thus Section 101 of the
legislation amends the Social Security Act to generally apply
the current job search standards, similar to those that apply
under the Extended Benefits program, to all weeks of
unemployment benefit collection, with appropriate updates to
assist States in effectively administering this provision.
A significant body of evidence suggests that effective job
search requirements increase the likelihood that unemployed
workers return to work. For example, a 2004 report by the
Upjohn Institute for Employment Research\1\ summarizes findings
from numerous studies that have shown how job search
requirements and job search assistance can significantly reduce
the length of receipt of unemployment insurance benefits.
Implementing a standard requirement across the Unemployment
Insurance system will communicate a uniform message to
recipients as well as help them more quickly return to the
workforce.
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\1\O'Leary, Christopher. 2004. UI Work Search Rules and Their
Effects on Employment. Report prepared for the Center for Employment
Security Education and Research, National Association of State
Workforce Agencies. Available online: http://research.upjohn.org/
reports/83/.
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The Subcommittee on Human Resources, in its February 10,
2011 hearing on improving efforts to help unemployed Americans
find jobs, received testimony in support of strengthening job
search. For example, Kristen Cox, the Executive Director of the
Utah Department of Workforce Services, noted, ``In Utah, UI
claimants are required to register for work with the
department's online job board within five business days of
their initial claim or they are denied benefits. Starting in
February this year, Utah has doubled the minimum work search
requirements to four job contacts per week. Returning to work
should be a full-time job. Not all States require this type of
activity.'' Douglas J. Holmes, President of UWC-Strategic
Services on Unemployment and Workers' Compensation, added, ``In
a recent survey of state unemployment insurance agencies
conducted for UWC by the National Foundation for Unemployment
Compensation and Workers' Compensation, 39 states reported
exceptions to the general work search requirements and one
state reported that it had no work search requirement as a
condition of eligibility for unemployment compensation.
Exceptions to work search requirements ranged from a general
exception when the state unemployment rate exceeded 8.5% to
situations where individuals are attached to prior employment
and expect to return to work, seek work through hiring halls or
temporary services, are in approved training, or are between
terms of employment for a seasonal employer.'' Mr. Holmes
recommended ``Work search requirements for federal programs and
standards for State work search requirements should be enacted
to send the appropriate signal to claimants that active work
search efforts are expected and required as a condition of
receiving unemployment compensation. Work search efforts should
be recorded and verifiable.''
As a result, the Committee believes that consistent and
meaningful job search requirements are both appropriate and
will help more unemployed individuals more quickly return to
work, which is the Unemployment Insurance program's ultimate
intent.
EXPLANATION OF PROVISION
The provision creates minimum job search requirements for
individuals collecting unemployment benefits--ensuring all are
actively seeking work, have registered for employment services,
have posted resumes, and have applied for work similar to that
which the individual previously performed.
EFFECTIVE DATE
The provision becomes effective after the end of the next
session of each State's legislature.
B. Participation in Reemployment Services Made a Condition of Benefit
Receipt (Sec. 102 of the Bill and Sec. 303(A) of the Social Security
Act and Sec. 3304 of the Internal Revenue Code)
PRESENT LAW
Federal law does not require minimum educational standards
as a condition of benefit receipt. Section 303(a)(9) 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 that (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 to 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 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.
REASONS FOR CHANGE
The Committee believes changes are needed to the existing
Unemployment Insurance system so that States better assist
individuals in receiving the education and other services they
require to return to work at decent wages.
First, the bill would generally condition UI receipt for
individuals without a high school diploma on their making
progress toward a GED; the provision allows States to waive
this requirement if it would be ``unduly burdensome'' in
individual cases--for example involving older workers with
substantial work experience. This provision responds to clear
evidence that individuals without a high school diploma are at
significant risk in current and likely future labor markets.
For example, according to Bureau of Labor Statistics data,\2\
in April 2011 adults without a high school diploma experienced
an unemployment rate of 14.6 percent--more than 50 percent
above the level for adults who had graduated from high school.
Only 39 percent of adults without a high school diploma were
employed, compared with 55 percent of high school graduates and
73 percent of college graduates. A February 2011 Brookings
Institution report\3\ put these differences in context: ``One
in three people in the United States with less than a high
school education is either unemployed or underemployed. . . .
Beyond the immediate difficulties that unemployment causes for
affected families, these differences in labor market
participation undermine the country's social fabric.'' The
provision is designed to expect more unemployed persons without
a high school diploma to use their time receiving benefits
productively, helping them return to work sooner and at better
wages, and whenever possible preventing future instances of
unemployment.
---------------------------------------------------------------------------
\2\``Table A-4. Employment status of the civilian population 25
years and over by educational attainment.'' May 6, 2011. Bureau of
Labor Statistics. Available online: http://www.bls.gov/news.release/
empsit.to4.htm
\3\Greenstone, Michael and Looney, Adam. February 4, 2011. A
Broader Look at the U.S. Employment Situation and the Importance of a
Good Education. The Brookings Institution. Available online: http://
www.brookings.edu/opinions/2011/0204_jobs_greenstone_looney.aspx
---------------------------------------------------------------------------
The Subcommittee on Human Resources, at its February 10,
2011 hearing, received testimony in support of engaging
individuals in additional education while they collect
unemployment benefits. For example, as part of a broader
activity requirement applicable to all unemployment benefit
recipients, Tom Pauken, the Chairman of the Texas Workforce
Commission, proposed, ``Those without a high school diploma
could choose to study for their GED. UI claimants in that
category would be entitled to first priority for participation
in existing federally funded Adult Basic Education programs.''
Second, Section 102 of the bill expects individuals who
have otherwise been referred to reemployment services by the
State to participate in those services as a condition of
eligibility for benefits. The Committee notes that States
currently must have a system that profiles all new claimants
for regular compensation, and identifies those most likely to
exhaust regular compensation and need job search assistance
services to make a successful transition to new employment.
While States are expected to refer the identified claimants to
reemployment services, there is no current requirement that the
individual participate in services to which they have been
referred. The Committee notes that, while record numbers have
been receiving and exhausting unemployment benefits in recent
years, a very small percentage of unemployment benefit
recipients are being referred to reemployment services, and
even fewer are completing them. In 2010 (the most recent
available data), out of almost 11 million people who started
collecting unemployment benefits, 2.2 million were referred to
reemployment services through the worker profiling system; but
of this number only slightly more than 200,000 reported to a
training service--only around 10 percent of those referred, and
less than 2 percent of all recipients.
EXPLANATION OF PROVISION
The provision amends Section 303(a) of the Social Security
Act and 3304(a) of the Internal Revenue Code to require
unemployment insurance recipients who lack a high school
diploma to be making progress toward a GED to remain eligible
for benefits; it includes a broad exception allowing States to
waive this requirement if it would be ``unduly burdensome'' in
individual cases, such as older workers. Separately, the
provision expects individuals who have otherwise been referred
to reemployment services by the State to participate in those
services as a condition of eligibility for unemployment
benefits.
EFFECTIVE DATE
The provision becomes effective after the end of the next
session of each State's legislature.
C. State Flexibility To Promote Returns to Work for Unemployed Workers
(Sec. 103 of the Bill and Section 305 of the Social Security Act)
PRESENT LAW
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.
REASONS FOR CHANGE
The Committee believes it is appropriate to enact changes
designed to help more people return to work. Testing innovative
approaches is an opportunity granted in other areas of social
policy. As a result, the Committee believes that States should
have the flexibility to test and evaluate innovative
demonstration projects within the Unemployment Insurance system
designed to help more unemployed workers return to work.
The Committee has long recognized the importance of State
flexibility and experimentation in social programs. Prior to
the successful welfare reform efforts undertaken by the
Committee in the mid-1990s, States were granted waivers from
certain requirements of welfare law to test new approaches to
help low-income families become self-sufficient. This
experimentation with work requirements, time limits,
eligibility criteria, and alternate types of benefits generated
a wealth of ideas for reforming the underlying program. These
ideas were then successfully adopted as part of a broad
nationwide overhaul of the welfare system, culminating in the
creation of the Temporary Assistance for Needy Families (TANF)
program in 1996. Research has shown that in the decade
following that overhaul, this program played a key role in
increasing earnings of low-income single mothers and in
reducing child poverty.
In addition to welfare waivers, the Committee has also
provided waiver authority to States in the area of child
welfare. These waivers allowed States to test ways of better
serving children in foster care and other programs, and the
results from successful child welfare waiver experiments also
have been incorporated into Federal law, which has both
improved the lives of children and ensured that money is well
spent.
Expanding this practice of providing waivers to include
State Unemployment Insurance programs may yield tangible short-
term gains for individuals while also providing valuable
information that can inform Federal policymaking in the future.
EXPLANATION OF PROVISION
The provision allows States to apply for cost-neutral
``waivers'' of Federal unemployment law, so they can test
innovative strategies to promote more and faster reemployment
of unemployed workers.
EFFECTIVE DATE
This provision becomes effective on the date of enactment
of the Act.
D. Repeal of Regulation Requiring Higher State Taxes (Sec. 104 of the
Bill and Sec. 1202(b)(2) of the Social Security Act)
PRESENT LAW
Programmatically, the U.S. Labor Department has long
suggested a State's balance account within the Unemployment
Trust Fund (UTF) should provide for one year's projected
benefit payment needs on the basis of the highest levels of
benefit payments experienced by the State over the last three
business cycles. This is called the average high-cost multiple
(AHCM). A ratio of 1.0 or greater prior to a recession would be
considered to be minimally solvent.
Section 1202(b)(2) of the SSA allows States to borrow funds
without interest from the Federal Unemployment Account (FUA)
within the UTF during the year. To receive these interest-free
loans, States must meet three conditions:
(A) States must repay the loans by September 30 of the
fiscal year.
(B) For those loans to maintain their interest-free status,
there cannot be any loans made to that State in October,
November, or December of the calendar year of such an interest-
free loan. If loans are made in the last quarter of the
calendar year, the ``interest-free'' loans made in the previous
fiscal year will retroactively accrue interest charges.
(C) States must meet funding goals relating to their
account in the UTF, established by the Secretary of Labor under
42 C.F.R. Sec. 503(c)(3).
42 C.F.R. Sec. 503(c)(3) requires that by 2019, States must
have had at least one year in the past five calendar years
before the year in which loans are taken where the ratio of its
trust fund balance to the average highest cost multiple (AHCM)
is at least 1.0. Additionally, States must meet two criteria
for maintenance of tax effort in every year from the most
recent year the AHCM was at least 1.0 and the year in which
advances are taken: The average State unemployment tax rate
(the ratio of total State tax amount collected over the total
taxable wages) was at least 80% of the prior year's rate; and,
the average State unemployment tax rate is at least 75% of the
average benefit-cost ratio over the preceding five calendar
years, where the benefit-cost ratio for a year is defined as
the amount of benefits and interest paid in the year divided by
the total covered wages paid in the year.
REASONS FOR CHANGE
The Committee is concerned that the solvency standard that
the U.S. Department of Labor has proposed would not be
reasonably attainable in many States, especially given the
large number of States with current negative balances,
including the more than 30 that have had to resort to a
combined over $40 billion in borrowing from the Federal
government to date. Thus the enforcement of the proposed
solvency standard in the future would have the effect of either
(1) forcing steep benefit reductions or even greater
unemployment tax increases on jobs than are already taking
effect due to the recession, further harming job creation and
hiring, or (2) permanently denying States the ability to access
short-term interest-free borrowing that would otherwise be
available to assist them in paying unemployment benefits in a
future downturn. Neither outcome is acceptable, and thus
section 104 repeals the U.S. Department of Labor regulation.
EXPLANATION OF PROVISION
The provision amends Section 1202(b)(2) of the Social
Security Act by repealing a September 17, 2010 U.S. Department
of Labor regulation on funding goals that would be made a
condition of a State's ability to receive interest-free
advances from the Federal Government for the payment of
unemployment insurance.
EFFECTIVE DATE
The provision becomes effective on the date of enactment of
the Act.
E. State Flexibility To Improve Unemployment Program Solvency Without
Raising Taxes (Sec. 105 of the Bill and Sec. 4001 of the Supplemental
Appropriations Act, 2008)
PRESENT LAW
Section 4001(g) of the Supplemental Appropriations Act of
2008 (P.L. 110-252), as amended, currently 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 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.
REASONS FOR CHANGE
The current ``nonreduction rule'' was originally applied in
the 2009 stimulus law as an effort to ensure States maintain
their own unemployment benefit payments while the Federal
government was providing an additional $25 per week in
``Federal additional compensation.'' The Committee believes
this current rule should be eliminated for several reasons.
First, ``Federal additional compensation'' is no longer
payable, having ended in December 2010. Thus the original
purpose for which this provision was created--to ensure that
States do not reduce State benefit levels while a special
Federal benefit of $25 was payable--no longer exists.
Second, this provision effectively forces States that wish
to improve the solvency of their UI programs to raise taxes,
rather than also consider appropriate benefit reductions. In
all prior recessions, States used both those tools to improve
the solvency of their unemployment programs. This
``nonreduction rule'' has thus likely contributed to the steep
rise in State unemployment taxes in recent years; State
unemployment taxes will have risen by 44 percent between fiscal
year 2009 (when this provision took effect) and 2011, according
to U.S. Department of Labor statistics in their Fiscal Year
2012 UI Outlook.
Finally, repeal of this provision is consistent with the
additional flexibility provided States under the provisions of
Title II of the JOBS Act, described below.
EXPLANATION OF PROVISION
The legislation repeals a provision in section 4001 of the
Supplemental Appropriations Act, 2008, that since the 2009
stimulus law has blocked States that want to improve solvency
from reducing State unemployment benefits while still receiving
Federal extended benefit funds. The provision being repealed
has left States no choice but to raise taxes on jobs if they
want to improve unemployment program solvency.
EFFECTIVE DATE
The provision becomes effective on the date of enactment of
the Act.
F. Data Standardization for Improved Data Matching (Sec. 106 of the
Bill and Title IX of the Social Security Act)
PRESENT LAW
There are currently no specific Federal laws or regulations
related to uniform data elements for data matching in the
Federal-State unemployment insurance system. Section 303(a)(6)
of the SSA requires States to make reports of information and
data as required by the U.S. Secretary of Labor. But current
Federal law contains no precise requirements regarding codes or
identifiers attached to UC, EUC08, or EB program data or any
other data standards.
REASONS FOR CHANGE
The Committee believes the programs within its jurisdiction
should, from an information technology standpoint, operate
consistently within and across programs. By beginning the
process of data standardization and the use of common reporting
mechanisms in this section, the Committee is achieving three
goals: better preventing and identifying fraud and abuse;
increasing the efficiency of administrative resources; and
producing program savings for U.S. taxpayers. The private
sector is decades ahead in its ability to use data efficiently
to detect patterns of misuse, such as when credit cards are
lost or stolen, and streamlining backend data processing. The
public sector needs to review those best practices to better
improve the operation of public benefit programs, prevent and
identify fraud and abuse, and improve recovery of misspent
taxpayer funds. The first step is organizing the data, as this
section directs the Secretary to do starting with the
Unemployment Insurance program.
The Subcommittee on Human Resources, in its March 11, 2011
hearing on the use of data matching to improve customer
service, program integrity, and taxpayer savings, received
testimony in support of consistent data standards that are non-
proprietary and promote the interoperability of data across
various information technology platforms, including State
legacy systems. The hearing confirmed that not only are
programs within the Subcommittee's jurisdiction in silos, but
so is the accompanying data. Improved data standards will help
increase the efficiency of data exchanges to use and reuse data
within and across programs. In the Unemployment Insurance
program, consistent data standards will allow States to
automate the exchange of claimant data on work and benefit
receipt, reducing delays and minimizing improper payments. It
will also help to automate application forms by pre-populating
them with reliable and verified data, which can reduce the
manual burden on staff and allow them more time to engage
individuals in reemployment services, all while reducing error.
Therefore, the Committee believes that non-proprietary,
interoperable data standards in the Unemployment Insurance
program are the first step to better organizing and using data
to address fraud and abuse and increase administrative
efficiency. This process will have the additional important
benefit of improving the services the program provides to
unemployed individuals in their efforts to return to work.
EXPLANATION OF PROVISION
The provision directs the U.S. Secretary of Labor to
develop standardized data elements to be used in improving the
accuracy and administration of unemployment benefits.
EFFECTIVE DATE
The provision becomes effective on October 1, 2012.
G. Technical and Conforming Amendments (Sec. 107 of the Bill and Sec.
3304(a)(4) of the Internal Revenue Code and 303(g)(1) of the Social
Security Act)
PRESENT LAW
Section 3304(a)(4)(D) of the IRC allows States to deduct
overpayments from current benefits, as authorized in Section
303(g)(1) of the SSA. Under current law, this deduction of
overpayments from unemployment benefit payments is optional for
States, which ``may'' carry out this provision (or may not).
Many States grant waivers--in cases of extreme hardship for
individuals, for example--or do not require this deduction of
overpayments for every case.
REASONS FOR CHANGE
The Committee believes in the need to strengthen program
integrity, including the collection of benefit overpayments.
Data reflecting benefit payments made in 2009 reveal
unemployment overpayments continue to increase in both
percentage and absolute dollar terms. A large part of the
absolute increase is due to the significant rise in total
unemployment benefits paid. The most recent data indicates an
overpayment rate of 10.6%, and a total of $16.5 billion in
annual overpayments. Recoverable overpayments estimated by the
Benefit Accuracy Measurement (BAM) survey increased from $2.8
billion in FY 2009 to $4.0 billion in FY 2010, as benefits paid
increased. The conforming amendment in the legislation is
designed to enhance the States' ability to efficiently recover
such rising overpayments from current benefits, with limited
additional administrative burdens. It is also consistent with
overpayment collection methods in other programs, as well as
the Treasury Offset Program designed to collect unemployment
benefits overpayments from Federal tax refunds.
EXPLANATION OF PROVISION
The provision requires States to reduce current
unemployment benefits to recover prior unemployment benefit
overpayments.
EFFECTIVE DATE
The provision becomes effective after the end of the next
session of each State's legislature.
TITLE II--FORWARD FUNDING REMAINING FEDERAL UNEMPLOYMENT COMPENSATION
A. Special Transfers to All States (Sec. 201 of the Bill and Sec. 903
of the Social Security Act)
PRESENT LAW
All unemployment benefits--including Federal unemployment
benefits (i.e., the Extended Benefit (EB) and Emergency
Unemployment Compensation (EUC08) programs)--are mandatory
entitlements paid out to individuals who meet certain
eligibility requirements. These benefit payments are not
appropriated by Congress under current law. Regular UC benefits
are financed through States taxes on employers.
Under permanent law in Section 204(a)(1) of the Federal-
State Extended Unemployment Compensation Act of 1970 (P.L. 91-
373), the cost of EB benefits are shared, with half (50%) of EB
funded by the Federal government and States funding the other
half (50%).
Section 2005(a) of the American Recovery and Reinvestment
Act of 2009 (P.L. 111-5), as amended, temporarily changes the
Federal-State funding arrangement. The Federal government
finances 100% of EB benefits until January 4, 2012, with the
exception of ``non-sharable'' benefits (generally, these are
former State and local employees' EB benefits). For individuals
who were receiving EB payments on January 4, 2012, the Federal
government will continue to pay 100% of EB benefits for the
duration of these individuals' benefits (but not for new
entrants to the EB program starting after that date).
Section 4004(e)(1) of the Supplemental Appropriations Act
of 2008 (P.L. 110-252), as amended, finances EUC08 benefits
from general funds of the U.S. Treasury through the expiration
of the EUC08 program the week ending on or before January 3,
2012. States do not need to repay these funds.
Under Section 4001(a) of the Supplemental Appropriations
Act of 2008 (P.L. 110-252), as amended, a State has the option
to terminate the Federal-State EUC08 agreement with 30 days
notice to the U.S. Department of Labor.
REASONS FOR CHANGE
Due to the record amount of unemployment benefits paid
since the start of the recession in 2007, most States have been
forced to dramatically increase unemployment taxes on jobs,
compromising employers' ability to hire new workers. Meanwhile,
under temporary Federal measures that expire in December 2011,
States will be paid about $31 billion in Federal unemployment
funds, but under current law none of that money can be used to
mitigate those steep tax hikes on jobs or otherwise provide
services to help more unemployed individuals return to work.
Instead, all of these temporary Federal funds must be spent on
a highly prescriptive system of 100% Federally-funded
unemployment benefits lasting up to 73 weeks, which when
combined with 26 weeks of State Unemployment Insurance
benefits, means unemployment checks in half of the States now
last up to 99 weeks per person--or nearly two years. The
current maximum of 73 weeks of 100% Federally-funded benefits
is 40 weeks longer than has ever been provided in any other
recession, and 47 weeks beyond the typical maximum of 26 weeks
of 100% Federally-funded benefits. Title II of this
legislation, and specifically section 201, is designed to
bridge this divide by providing all States new flexibility in
spending their share of the $31 billion in remaining temporary
Federal unemployment funds. Under section 201, States must use
this money to continue paying current Federal unemployment
benefits, unless they pass laws to use the funds differently
within the bounds of the Unemployment Insurance system,
including to promote more job creation and hiring.
Specifically, by passing a new State law, States could
spend these temporary Federal funds within the UI system for
any of the following purposes: (1) to support State
unemployment benefits without the need for higher taxes or
additional borrowing; (2) to provide reduced weeks of extended
benefits after workers exhaust State benefits (or even
increased weeks for certain individuals or groups, subject to
the fixed amount of funds provided); (3) to repay Federal
unemployment loans States have taken to pay past unemployment
benefits or to pay the interest on those loans, without having
to raise State unemployment taxes; or (4) to provide
reemployment services, including wage subsidies, promoting
reemployment and job creation.
States with unemployment loans would not have their
interest charges waived, but instead could better target
current Federal funds and use any savings to prevent job-
destroying unemployment tax hikes. Under current law up to 99
weeks of total unemployment benefits are paid across most of
the U.S., including up to 73 weeks of Federal benefits, an all-
time record. But 70 percent of the Federal spending to date
behind those 73 weeks of benefits has been untargeted, as the
money has been spent without regard to the State's unemployment
rate. For example, under current law, in North Dakota where the
unemployment rate is 3.6 percent, unemployed workers collect
over a year of total benefits, including 34 weeks of Federal
unemployment benefits. Even in States with unemployment rates
as low as 6.5 percent--which is significantly below the current
9.0 percent national average--as many as 60 weeks of Federal
benefits are payable after someone exhausts 26 weeks of State
benefits, for a total of 86 weeks of benefits. Section 201 of
the legislation allows States to decide whether these Federal
rules make sense given local conditions, and if not, to choose
to spend money that has already been committed more wisely
within the unemployment insurance system, by passing a law to
that effect.
The Congressional Budget Office expects that current
temporary Federal unemployment benefits law will result in $31
billion in Federal spending during the remainder of FYs 2011
and 2012. Section 201 equitably divides that $31 billion in
expected spending among the States, according to their share of
Federal unemployment benefits spending in the past 12 months.
EXPLANATION OF PROVISION
The provision forward funds to State unemployment accounts
the expected $31 billion in remaining temporary Federal
unemployment funds. Funds will be provided in FY 2011 ($12.8
billion, transferred within 10 days of enactment) and FY 2012
($18.2 billion, transferred between October 1st and 10th,
2011). State shares of the $31 billion will be equal to their
share of Federal unemployment benefit spending in the most
recent 12 months. This provision also requires States to spend
these funds: (1) to pay current Federal unemployment benefits;
or (2) as specified by a State law passed after enactment, for
regular or extended unemployment benefits, for repaying Federal
unemployment loans (or interest on those loans), or for
reemployment services such as wage subsidies, job search
assistance, and other services designed to promote rapid
reemployment.
EFFECTIVE DATE
The provision becomes effective on the date of enactment of
the Act.
B. Emergency Unemployment Compensation Transition Rules (Sec. 202 of
the Bill and Sec. 4003 and 4004(e)(1) of the Supplemental
Appropriations Act, 2008)
PRESENT LAW
Section 4001 of the Supplemental Appropriations Act of 2008
(P.L. 110-252), as amended, allows all States to enter into a
Federal-State agreement to make EUC08 payments to eligible
individuals. As described above, EUC08 benefit payments are
currently financed from general funds of the U.S. Treasury
until the expiration of the EUC08 program the week ending on or
before January 3, 2012.
Section 4001(a) of the Supplemental Appropriations Act of
2008 (P.L. 110-252, as amended) provides a State with the
option to terminate the Federal-State EUC08 agreement with 30
days notice to the U.S. Department of Labor.
Section 4003(a) of the Supplemental Appropriations Act of
2008 (P.L. 110-252), as amended, authorizes payments to States
with Federal-State agreements from the U.S. Treasury for the
purposes of EUC08 benefits.
REASONS FOR CHANGE
The provisions of Section 201 forward fund all of the
remaining Federal Emergency Unemployment Compensation (EUC)
program funds to States. Consistent with that, Section 202
ends the current monthly payment mechanism for that program,
which is no longer needed.
EXPLANATION OF PROVISION
Since Section 201 forward funds to all States their
expected share of remaining Federal EUC funds payable during
the remainder of that program, this section repeals the current
monthly payment system used by that program. It also includes a
technical provision adding this legislation to the list of
unemployment laws for which general funds may be transferred.
EFFECTIVE DATE
The repeal of current monthly payments to States is
effective with respect to weeks ending after July 6, 2011.
C. Extended Benefits Program Transition Rules (Sec. 203 of the Bill,
Sec. 2005 of the Assistance for Unemployed Workers and Struggling
Families Act, Sec. 203 and 204(a)(1) of the Federal-State Extended
Unemployment Compensation Act of 1970, and Sec. 502 of the Tax Relief,
Unemployment Reauthorization, and Job Creation Act of 2010)
PRESENT LAW
As detailed above, EB benefits are temporarily 100%
Federally financed (Section 2005(a) of the American Recovery
and Reinvestment Act of 2009 (P.L. 111-5), as amended). Under
current law, the Federal government finances 100% of EB
benefits until January 4, 2012 with the exception of
``nonsharable'' benefits (benefits for persons who worked for
employers that are not subject to Federal Unemployment Taxes
such as former State employees). The Federal government will
continue to pay 100% of EB benefits for the duration of these
individuals' benefits for individuals receiving EB payments on
January 4, 2012, but not for new entrants to the EB program
after that date.
In addition, Section 502 of the Tax Relief, Unemployment
Insurance Reauthorization, and Job Creation Act of 2010 (P.L.
111-312) amends Sections 203(d) & (f) of the Federal-State
Extended Unemployment Compensation Act of 1970 (P.L. 91-373) to
allow States to temporarily use lookback calculations for their
EB trigger based on three years of unemployment rate data
(rather than the current lookback of two years of data) as part
of their mandatory and/or optional EB triggers if States would
otherwise trigger off or not be on a period of EB benefits.
States implement the lookback changes individually by amending
their State Unemployment Compensation laws. This temporary
option to use three-year EB trigger lookbacks expires the week
on or before December 31, 2011. As of May 8, 2011, 23 States
have enacted State laws to adopt a three-year lookback for one
or more of the EB program triggers.
REASONS FOR CHANGE
The Committee believes that States should be provided
flexibility to support Unemployment Insurance beneficiaries in
returning to work by forward funding remaining Federal extended
benefit dollars to the States. However, if States take no
additional action, the Committee intends for benefits to
continue to be paid under current temporary Federal policies.
EXPLANATION OF PROVISION
The provisions of Section 201 forward fund all of the
remaining Federal Extended Benefit (EB) program funds to States
associated with temporary expansions of that program,
specifically policies that provide for 100 percent Federal
funding and a three-year lookback that has allowed more States
to qualify for the program in CY 2011. Consistent with that
forward funding approach in Section 201, Section 203 ends those
temporary expansions, since States will receive the funds
associated with those policies.
This section includes a technical ``savings provision''
designed to ensure that, if States take no additional action,
EB program benefits continue to be paid automatically, despite
State laws that express that the program will only be
operational as long as they receive 100% Federal funding or
apply a three-year lookback.
EFFECTIVE DATE
In general, these provisions are effective on July 1, 2011.
D. Emergency Designation (Sec. 204 of the Bill)
PRESENT LAW
Section 204 of this legislation designates the budgetary
effects of H.R. 1745 as an emergency requirement and
``necessary to meet emergency needs pursuant to section 4(g) of
the Statutory Pay-As-You-Go Act of 2010.''
REASONS FOR CHANGE
The Committee believes current emergency funds should be
repurposed to provide greater flexibility to States and that
this will help more people return to work. Because of this
repurposing, the legislation needs to carry an emergency
designation.
EXPLANATION OF PROVISION
Section 204 is a technical provision required because the
underlying provisions amended in Title II originally carried an
emergency designation. Because it amends the purposes for which
funds payable under those provisions may be spent, the
legislation also needs to carry an emergency designation.
EFFECTIVE DATE
The provision is effective upon the date of enactment of
the Act.
III. VOTES OF THE COMMITTEE
In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, the following statements are made
concerning the votes of the Committee on Ways and Means in its
consideration of the bill, H.R. 1745.
The bill H.R. 1745 was ordered favorably reported, as
amended, by a rollcall vote of 20 yeas to 14 nays (with a
quorum being present). The vote was as follows:
----------------------------------------------------------------------------------------------------------------
Representative Yea Nay Present Representative Yea Nay Present
----------------------------------------------------------------------------------------------------------------
Mr. Camp....................... X ........ ......... Mr. Levin........ ........ X .........
Mr. Herger..................... X ........ ......... Mr. Rangel....... ........ X .........
Mr. Johnson.................... ........ ........ ......... Mr. Stark........ ........ X .........
Mr. Brady...................... X ........ ......... Mr. McDermott.... ........ X .........
Mr. Ryan....................... X ........ ......... Mr. Lewis........ ........ ........ .........
Mr. Nunes...................... X ........ ......... Mr. Neal......... ........ X .........
Mr. Tiberi..................... X ........ ......... Mr. Becerra...... ........ X .........
Mr. Davis...................... X ........ ......... Mr. Doggett...... ........ X .........
Mr. Reichert................... X ........ ......... Mr. Thompson..... ........ X .........
Mr. Boustany................... X ........ ......... Mr. Larson....... ........ X .........
Mr. Roskam..................... X ........ ......... Mr. Blumenauer... ........ X .........
Mr. Gerlach.................... X ........ ......... Mr. Kind......... ........ X .........
Mr. Price...................... X ........ ......... Mr. Pascrell..... ........ X .........
Mr. Buchanan................... X ........ ......... Ms. Berkley...... ........ X .........
Mr. Smith...................... X ........ ......... Mr. Crowley...... ........ X .........
Mr. Schock..................... X ........ .........
Ms. Jenkins.................... X ........ .........
Mr. Paulsen.................... X ........ .........
Mr. Marchant................... X ........ .........
Mr. Berg....................... X ........ .........
Ms. Black...................... X ........ .........
----------------------------------------------------------------------------------------------------------------
VOTES ON AMENDMENTS
The Davis Amendment to the Amendment in the Nature of a
Substitute to H.R. 1745 passed by voice vote (with a quorum
being present).
The Doggett Amendment to the Amendment in the Nature of a
Substitute to H.R. 1745 failed by voice vote (with a quorum
being present).
IV. BUDGET EFFECTS OF THE BILL
A. Committee Estimate of Budgetary Effects
In compliance with clause 3(d) of rule XIII of the Rules of
the House of Representatives, the following statement is made
concerning the effects on the budget of the revenue provisions
of the bill, H.R. 1745 as reported: The Committee agrees with
the estimates prepared by the Congressional Budget Office
(CBO), which are included below.
STATEMENT REGARDING NEW BUDGET AUTHORITY AND TAX EXPENDITURES BUDGET
AUTHORITY
The bill as reported is not in compliance with clause
3(c)(2) of rule XIII of the Rules of the House of
Representatives. However, the Chairman of the Committee on Ways
and Means has already provided an amendment in the nature of a
substitute to the Committee on Rules to bring the bill into
compliance with clause 3(c)(2) of rule XIII of the Rules of the
House of Representatives. The amendment makes technical and
conforming changes to Section 203 of the legislation, which
were brought to the Committee's attention after markup and are
designed to ensure that individuals currently eligible for
Extended Benefits remain eligible and that States are not able
to claim additional matching payments since the bill already
provides full Federal funding for those benefits.
Once the technical and conforming changes are made to
section 203, the Committee will be able to state that the bill
involves no new or increased budgetary authority. The Committee
will also be able to state further that the bill involves no
new or increased tax expenditures.
As a result, the Committee has requested CBO provide an
estimate for the bill as reported as well as for the amendment
in the nature of a substitute containing the technical and
conforming changes needed to comply with both the Committee's
intent and House rules on deficit reduction.
B. Cost Estimate Prepared by the Congressional Budget Office
In compliance with clause 3(c)(3) of rule XIII of the Rules
of the House of Representatives, requiring a cost estimate
prepared by the CBO, the following statement by CBO is
provided:
U.S. Congress,
Congressional Budget Office,
Washington, DC, May 23, 2011.
Hon. Dave Camp,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 1745, the Jobs,
Opportunity, Benefits, and Services Act of 2011.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Christina
Hawley Anthony.
Sincerely,
Douglas W. Elmendorf.
Enclosure.
H.R. 1745--Jobs, Opportunity, Benefits, and Services Act of 2011
Summary: H.R. 1745 would, beginning in July 2011, repeal
provisions that allow federal reimbursements for the emergency
unemployment compensation program (EUC), temporarily provide
full federal funding for extended benefits (EB), and allow
states to make it easier to provide EB. The legislation also
would temporarily suspend the 50 percent federal match for EB
through December 2011.
Additionally, enacting the bill would provide special
distributions to the states in 2011 and 2012 totaling $31
billion, which states could use to continue to provide EUC and
EB (as those programs existed on May 1, 2011), or pay for other
unemployment-related expenses, including any interest due on
loans from the unemployment trust fund (UTF).
Finally, H.R. 1745 would require states to reduce
unemployment benefits to individuals who have received
overpayments, require individuals to meet certain criteria for
receipt of benefits, and direct the Department of Labor to
establish uniform reporting codes.
CBO estimates that enacting H.R. 1745 would reduce outlays
by $125 million in 2011 and by $3.1 billion over the 2011-2021
period. Under the bill, revenues also would decline by $2.4
billion over the 2011-2021 period. On balance, enacting H.R.
1745 would reduce deficits by approximately $0.7 billion over
the 2011-2021 period. Implementing the bill would not have a
significant effect on discretionary spending.
Pay-as-you-go procedures apply because enacting the
legislation would affect direct spending and revenues.
H.R. 1745 would impose no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act
(UMRA).
Estimated cost to the Federal Government: The estimated
budgetary impact of H.R. 1745 is shown in the following table.
The costs of this legislation fall within budget function 600
(income security).
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
--------------------------------------------------------------------------------------------------------------------------
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2011-2016 2011-2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
CHANGES IN DIRECT SPENDING
Estimated Budget Authority... -125 -2,835 -15 -15 -15 -15 -15 -15 -15 -15 -15 -3,020 -3,095
Estimated Outlays............ -125 -2,835 -15 -15 -15 -15 -15 -15 -15 -15 -15 -3,020 -3,095
CHANGES IN REVENUES
Estimated Revenues........... 0 -8 -211 -616 -617 -477 -233 -185 -38 -11 -11 -1,929 -2,407
NET INCREASE OR DECREASE (-) IN THE DEFICIT FROM CHANGES IN DIRECT SPENDING AND REVENUES
Estimated Impact on the -125 -2,827 196 601 602 462 218 170 23 -4 -4 -1,091 -688
Deficit.....................
--------------------------------------------------------------------------------------------------------------------------------------------------------
Basis of estimate: For the purpose of this estimate, CBO
assumes H.R. 1745 will be enacted by July 1, 2011. Later
enactment could change the estimate significantly.
H.R. 1745 would repeal the federal funding for EUC for
weeks of unemployment ending after July 6, 2011. In addition,
H.R. 1745 would terminate temporary aspects of the EB program
that extend 100 percent federal funding for that program and
make it easier for states to meet the unemployment rate
thresholds required to provide benefits. The bill also would
temporarily suspend the 50 percent federal match for EB through
December 2011.
Direct Spending
The bill would transfer $12.8 billion to states for fiscal
year 2011 and $18.2 billion for fiscal year 2012. States could
use those funds to operate EUC and EB as they existed in state
agreements as of May 1, 2011. However, the total amount that
would be transferred is about $0.6 billion lower than the
amounts CBO projects states will spend on EUC and special EB
under current law. (Under current law, EUC and the temporary EB
provisions are authorized through December 2011; states may
terminate agreements to provide EUC by giving 30 days' notice
to the Department of Labor.) A state could use the transferred
funds for other unemployment-related purposes, including paying
interest due on loans from the UTF, but such changes would
require state legislation.
CBO estimates that most states would continue to operate
EUC and EB programs using their share of the total $31 billion
in transfers that would be provided by H.R. 1745. However, CBO
expects that some states would opt out of EUC, provide fewer
benefits under EB, or change their laws to use a portion of the
funds for other purposes. CBO estimates that such changes would
decrease outlays for EUC and EB by $125 million in 2011 and
$2.8 billion in 2012.
The bill also would direct states to offset overpayments of
unemployment compensation by reducing benefits to individuals,
harmonize job search requirements, and mandate recipients of
unemployment compensation to meet a minimum education threshold
(though that requirement could be waived in cases of hardship).
CBO estimates those provisions would reduce outlays by about
$15 million per year beginning in 2013.
Revenues
Provisions in H.R. 1745 would affect states' revenues for
unemployment compensation, which are reflected on the federal
budget. Lower outlays would result in higher balances in
states' unemployment trust funds. CBO estimates that some
states would respond to the higher balances by reducing their
unemployment taxes (or by avoiding tax increases assumed in the
baseline that would replenish the trust funds). As a result,
CBO estimates that, on net, revenues would decline by $2.4
billion over the 2011-2021 period under H.R. 1745.
Pay-As-You-Go considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget reporting and enforcement
procedures for legislation affecting direct spending or
revenues. The net changes in outlays and revenues that are
subject to those pay-as-you-go procedures are shown in the
following table. Under H.R. 1745, there would be no net impact
for purposes of enforcing the Statutory Pay-As-You-Go Act
because the bill would designate the bill's effects as an
emergency requirement.
CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 1745 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON MAY 11, 2011, WITH SUBSEQUENT LANGUAGE PROVIDED ON MAY 18, 2011
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
------------------------------------------------------------------------------------------------------------------------------
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2011-2016 2011-2021
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE OR DECREASE (-) IN THE DEFICIT
Total change..................................................... -125 -2,827 196 601 602 462 218 170 23 -4 -4 -1,091 -688
Less:
Designated as Emergency Requirementsa........................ 125 2,827 -196 -601 -602 -462 -218 -170 -23 4 4 1,091 688
Statutory Pay-As-You Go Impact................................... 0 0 0 0 0 0 0 0 0 0 0 0 0
Memorandum:
Change in Outlays............................................ -125 -2,835 -15 -15 -15 -15 -15 -15 -15 -15 -15 -3,020 -3,095
Change in Revenues........................................... 0 -8 -211 -616 -617 -477 -233 -185 -38 -11 -11 -1,929 -2,407
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
aSection 204 of H.R. 1745 would designate the budgetary effects of the bill as an emergency requirement pursuant to section 4(g) of the Statutory Pay-As-You-Go Act of 2010.
Intergovernmental and private-sector impact: H.R. 1745
contains no intergovernmental or private-sector mandates as
defined in UMRA. CBO estimates that changes to the unemployment
compensation program would result in lower federal transfers to
the states than under current law and also would result in
decreases in unemployment taxes in some states. These effects,
however, would result from states' participation in the federal
unemployment insurance program, which is voluntary, and would
not result from intergovernmental mandates as defined in UMRA.
Previous CBO estimate: On May 23, 2011, CBO transmitted an
estimate of the budgetary effects of H.R. 1745, as ordered
reported by the House Committee on Ways and Means on May 11,
2011. That version of the bill would allow states to receive a
federal match of 50 percent of the costs of EB beginning in
July 2011, and, in CBO's estimation, would result in a net
increase in federal deficits of $4 million over the 2011-2021
period. The amendment in the nature of a substitute would
temporarily suspend that matching provision, and as a result
would result in savings over the 2011-2021 period of $0.7
billion.
Estimate prepared by: Federal Spending: Christina Hawley
Anthony; Federal Revenues: Barbara Edwards; Impact on State,
Local, and Tribal Governments: Lisa Ramirez-Branum; Impact on
the Private Sector: Sarah Axeen.
Estimate approved by: Peter H. Fontaine, Assistant Director
for Budget Analysis; Frank Sammartino; Assistant Director for
Tax Analysis.
U.S. Congress,
Congressional Budget Office,
Washington, DC, May 23, 2011.
Hon. Dave Camp,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 1745, the Jobs,
Opportunity, Benefits, and Services Act of 2011.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Christina
Hawley Anthony.
Sincerely,
Douglas W. Elmendorf.
Enclosure.
H.R. 1745--Jobs, Opportunity, Benefits, and Services Act of 2011
Summary: H.R. 1745 would, beginning in July 2011, repeal
provisions that allow federal reimbursements for the emergency
unemployment compensation program (EUC), temporarily provide
full federal funding for extended benefits (EB), and allow
states to make it easier to provide EB.
Additionally, enacting the bill would provide special
distributions to the states in 2011 and 2012 totaling $31
billion, which states could use to continue to provide EUC and
EB (as those programs existed on May 1, 2011), or pay for other
unemployment-related expenses, including any interest due on
loans from the unemployment trust fund (UTF).
Finally, H.R. 1745 would require states to reduce
unemployment benefits to individuals who have received
overpayments, require individuals to meet certain criteria for
receipt of benefits, and direct the Department of Labor to
establish uniform reporting codes.
CBO estimates that enacting H.R. 1745 would reduce outlays
by $125 million in 2011 and by $3.1 billion over the 2011-2021
period. Under the bill, revenues also would decline by $3.1
billion over the 2011-2021 period. On balance, enacting H.R.
1745 would increase deficits by $4 million over the 2011-2021
period. Implementing the bill would not have a significant
effect on discretionary spending.
Pay-as-you-go procedures apply because enacting the
legislation would affect direct spending and revenues.
H.R. 1745 would impose no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act
(UMRA).
Estimated cost to the Federal Government: The estimated
budgetary impact of H.R. 1745 is shown in the following table.
The costs of this legislation fall within budget function 600
(income security).
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------------------------------------------------------------------------
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2011-2016 2011-2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
CHANGES IN DIRECT SPENDING
Estimated Budget Authority.... -125 -2,835 -15 -15 -15 -15 -15 -15 -15 -15 -15 -3,020 -3,095
Estimated Outlays............. -125 -2,835 -15 -15 -15 -15 -15 -15 -15 -15 -15 -3,020 -3,095
CHANGES IN REVENUES
Estimated Revenues............ 0 -47 -352 -798 -772 -568 -291 -208 -41 -11 -11 -2,537 -3,099
NET INCREASE OR DECREASE (-) IN THE DEFICIT FROM CHANGES IN DIRECT SPENDING AND REVENUES
Estimated Impact on the -125 -2,788 337 783 757 553 276 193 26 -4 -4 -483 4
Deficit......................
--------------------------------------------------------------------------------------------------------------------------------------------------------
Basis of estimate: For the purpose of this estimate, CBO
assumes H.R. 1745 will be enacted by July 1, 2011. Later
enactment could change the estimate significantly.
H.R. 1745 would repeal the federal funding for EUC for
weeks of unemployment ending after July 6, 2011. In addition,
H.R. 1745 would terminate temporary aspects of the EB program
that extend 100 percent federal funding for that program and
make it easier for states to meet the unemployment rate
thresholds required to provide benefits.
Direct Spending
The bill would transfer $12.8 billion to states for fiscal
year 2011 and $18.2 billion for fiscal year 2012. States could
use those funds to operate EUC and EB as they existed in state
agreements as of May 1, 2011. However, the total amount that
would be transferred is about $0.6 billion lower than the
amounts CBO projects states will spend on EUC and special EB
under current law. (Under current law, EUC and the temporary EB
provisions are authorized through December 2011; states may
terminate agreements to provide EUC by giving 30 days' notice
to the Department of Labor.) A state could use the transferred
funds for other unemployment-related purposes, including paying
interest due on loans from the UTF, but such changes would
require state legislation.
CBO estimates that most states would continue to operate
EUC and EB programs using their share of the total $31 billion
in transfers that would be provided by H.R. 1745. However, CBO
expects that some states would opt out of EUC, provide fewer
benefits under EB, or change their laws to use a portion of the
funds for other purposes. CBO estimates that such changes would
decrease outlays for EUC and EB by $125 million in 2011 and
$2.8 billion in 2012.
The bill also would direct states to offset overpayments of
unemployment compensation by reducing benefits to individuals,
harmonize job search requirements, and mandate recipients of
unemployment compensation to meet a minimum education threshold
(though that requirement could be waived in cases of hardship).
CBO estimates those provisions would reduce outlays by about
$15 million per year beginning in 2013.
Revenues
Provisions in H.R. 1745 would affect states' revenues for
unemployment compensation, which are reflected on the federal
budget. Lower outlays would result in higher balances in
states' unemployment trust funds. In addition, beginning in
July 2011, states would be able to receive a 50 percent match
on expenses for EB, even if the states choose to fund their EB
expenses with their share of the transferred funds. That
provision also would result in higher balances in states' trust
funds than under current law. CBO estimates that some states
would respond to the higher balances by reducing their
unemployment taxes (or by avoiding tax increases assumed in the
baseline that would replenish the trust funds). As a result,
CBO estimates that, on net, revenues would decline by $3.1
billion over the 2011-2021 period under H.R. 1745.
Pay-As-You-Go considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget reporting and enforcement
procedures for legislation affecting direct spending or
revenues. The net changes in outlays and revenues that are
subject to those pay-as-you-go procedures are shown in the
following table. Under H.R. 1745, there would be no net impact
for purposes of enforcing the Statutory Pay-As-You-Go Act
because the bill would designate the bill's effects as an
emergency requirement.
CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 1745 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON MAY 11, 2011, WITH SUBSEQUENT
LANGUAGE PROVIDED ON MAY 18, 2011
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-------------------------------------------------------------------------------------------------------------------------
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2011-2016 2011-2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE OR DECREASE (-) IN THE DEFICIT
Total change.................. -125 -2,788 337 783 757 553 276 193 26 -4 -4 -483 4
Less:
Designated as Emergency 125 2,788 -337 -783 -757 -553 -276 -193 -26 4 4 483 -4
Requirementsa............
Statutory Pay-As-You Go Impact 0 0 0 0 0 0 0 0 0 0 0 0 0
Memorandum:
Change in Outlays......... -125 -2,835 -15 -15 -15 -15 -15 -15 -15 -15 -15 -3,020 -3,095
Change in Revenues........ 0 -47 -352 -798 -772 -568 -291 -208 -41 -11 -11 -2,537 -3,099
--------------------------------------------------------------------------------------------------------------------------------------------------------
aSection 204 of H.R. 1745 would designate the budgetary effects of the bill as an emergency requirement pursuant to section 4(g) of the Statutory Pay-As-
You-Go Act of 2010.
Intergovernmental and private-sector impact: H.R. 1745
contains no intergovernmental or private-sector mandates as
defined in UMRA. CBO estimates that changes to the unemployment
compensation program would result in lower federal transfers to
the states than under current law and also would result in
decreases in unemployment taxes in some states. These effects,
however, would result from states' participation in the federal
unemployment insurance program, which is voluntary, and would
not result from intergovernmental mandates as defined in UMRA.
Estimate prepared by: Federal Spending: Christina Hawley
Anthony; Federal Revenues: Barbara Edwards; Impact on State,
Local, and Tribal Governments: Lisa Ramirez-Branum; Impact on
the Private Sector: Sarah Axeen.
Estimate approved by: Peter H. Fontaine, Assistant Director
for Budget Analysis; Frank Sammartino, Assistant Director for
Tax Analysis.
V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE OF
REPRESENTATIVES
A. Committee Oversight Findings and Recommendations
With respect to clause 3(c)(1) of rule XIII of the Rules of
the House of Representatives (relating to oversight findings),
the Committee concluded that it was appropriate and timely to
enact the sections included in the bill, as reported.
B. Statement of General Performance Goals and Objectives
With respect to clause 3(c)(4) of rule XIII of the Rules of
the House of Representatives, the Committee advises that the
bill contains no measure that authorizes new or additional
funding compared with the current law baseline, so no statement
of general performance goals and objectives for which any
measure authorizes funding is required.
C. Information Relating to Unfunded Mandates
This information is provided in accordance with section 423
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
The Committee has determined that the revenue provisions of
the bill do not impose a Federal mandate on the private sector.
The Committee has determined that the revenue provisions of the
bill do not impose a Federal intergovernmental mandate on
State, local, or tribal governments.
D. Applicability of House Rule XXI 5(b)
Clause 5(b) of rule XXI of the Rules of the House of
Representatives provides, in part, that ``A bill or joint
resolution, amendment, or conference report carrying a Federal
income tax rate increase may not be considered as passed or
agreed to unless so determined by a vote of not less than
three-fifths of the Members voting, a quorum being present.''
The Committee has carefully reviewed the sections of the bill,
and states that the bill does not involve any Federal income
tax rate increases within the meaning of the rule.
E. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits
With respect to clause 9 of rule XXI of the Rules of the
House of Representatives, the Committee has carefully reviewed
the provision of the bill, and states that the provisions of
the bill do not contain any congressional earmarks, limited tax
benefits, or limited tariff benefits within the meaning of the
rule.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
SOCIAL SECURITY ACT
* * * * * * *
TITLE III--GRANTS TO STATES FOR UNEMPLOYMENT COMPENSATION
ADMINISTRATION
* * * * * * *
PROVISIONS OF STATE LAWS
Sec. 303. (a) The Secretary of Labor shall make no
certification for payment to any State unless he finds that the
law of such State, approved by the Secretary of Labor under the
Federal Unemployment Tax Act, includes provision for--
(1) * * *
* * * * * * *
[(10) A requirement that, as a condition of
eligibility for regular compensation for any week, any
claimant who has been referred to reemployment services
pursuant to the profiling system under subsection
(j)(1)(B) participate in such services or in similar
services unless the State agency charged with the
administration of the State law determines--
[(A) such claimant has completed such
services; or
[(B) there is justifiable cause for such
claimant's failure to participate in such
services.]
(10)(A) A requirement that, as a condition of
eligibility for regular compensation for any week--
(i) a claimant shall meet the minimum
educational requirements set forth in
subparagraph (B); and
(ii) any claimant who has been referred to
reemployment services shall participate in such
services.
(B) For purposes of this paragraph, an individual
shall not be considered to have met the minimum
educational requirements of this subparagraph unless
such individual--
(i) has earned a high school diploma;
(ii) has earned the General Educational
Development (GED) credential or other State-
recognized equivalent (including by meeting
recognized alternative standards for
individuals with disabilities); or
(iii) is enrolled and making satisfactory
progress in classes leading to satisfaction of
clause (ii).
(C) The requirements of subparagraph (B) may be
waived for an individual to the extent that the State
agency charged with the administration of the State law
deems such requirements to be unduly burdensome in the
case of such individual.
(11)(A) 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) For purposes of this paragraph, the term
``actively seeking work'' means, with respect to any
individual, that such individual is actively engaged in
a systematic and sustained effort to obtain work, as
determined based on evidence (whether in electronic
format or otherwise) satisfactory to the State agency
charged with the administration of the State law.
(C) The specific requirements that must be met in
order to satisfy this paragraph shall be established by
the State agency, and shall include at least the
following:
(i) Registration for employment services
within 14 days after making initial application
for regular compensation.
(ii) Posting a resume, record, or other
application for employment on such database as
the State agency may require.
(iii) Applying, in such manner as the State
agency may require, for work which is similar
to that previously performed by the individual,
and which offers wages comparable to wages for
similar work in the local labor market in which
the individual resides or is actively seeking
work.
* * * * * * *
(g)(1) A State [may] shall deduct from unemployment benefits
otherwise payable to an individual an amount equal to any
overpayment made to such individual under an unemployment
benefit program of the United States or of any other State, and
not previously recovered. The amount so deducted shall be paid
to the jurisdiction under whose program such overpayment was
made. Any such deduction shall be made only in accordance with
the same procedures relating to notice and opportunity for a
hearing as apply to the recovery of overpayments of regular
unemployment compensation paid by such State.
* * * * * * *
DEMONSTRATION PROJECTS
Sec. 305. (a) The Secretary of Labor may enter into
agreements, with States submitting 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
establish initial eligibility for 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, at a minimum, 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,
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 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 control or comparison group or other valid
methodology, of the demonstration project; and
(B) will determine the extent to which the
goals and outcomes described in paragraph (3)
were achieved; and
(6) assurances that the State will provide any
reports relating to the demonstration project, after
its approval, as the Secretary of Labor may require.
(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; and
(2) may not be approved for a period of time greater
than 3 years, subject to extension upon request of the
Governor of the State involved for such additional
period as the Secretary of Labor may agree to, except
that in no event may a demonstration project under this
section be conducted after the end of the 5-year period
beginning on the date of enactment of this section.
(e) 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 such 30 days shall be
deemed approved, and public notice of any approval under this
sentence shall be provided within 10 days thereafter.
(f) The Secretary of Labor may terminate a demonstration
project under this section if the Secretary makes a final
determination that the State has violated the substantive terms
or conditions of the project.
* * * * * * *
TITLE IX--MISCELLANEOUS PROVISIONS RELATING TO EMPLOYMENT SECURITY
* * * * * * *
AMOUNTS TRANSFERRED TO STATE ACCOUNTS
Sec. 903. (a) * * *
* * * * * * *
Special Transfers in Fiscal Years 2011 and 2012
(h)(1) The Secretary of the Treasury shall transfer (as of
the dates determined under paragraph (4)) from the extended
unemployment compensation account to the account of each State
in the Unemployment Trust Fund the amount determined with
respect to such State under paragraph (2).
(2)(A) The amount to be transferred to a State under this
subsection in any fiscal year is the amount derived by
multiplying the applicable total dollar amount for such fiscal
year by the applicable fraction for such State.
(B) For purposes of subparagraph (A), the applicable total
dollar amount is--
(i) for fiscal year 2011, $12,800,000,000; and
(ii) for fiscal year 2012, $18,200,000,000.
(C) For purposes of subparagraph (A), the applicable fraction
for a State is a fraction--
(i) the numerator of which is the total amount of
extended compensation and emergency unemployment
compensation paid out by such State for weeks beginning
in the 12-month period described in clause (ii); and
(ii) the denominator of which is the total amount of
extended compensation and emergency unemployment
compensation paid out by all States for weeks beginning
in the most recent 12-month period for which that
information is available for all States as of May 1,
2011.
(3)(A) Except as provided in subparagraph (B), amounts
transferred to a State account pursuant to this subsection
shall be used only in the payment of extended compensation and
emergency unemployment compensation, in accordance with
applicable provisions of Federal and State law (including
agreements and implementing regulations) as in effect on May 1,
2011.
(B) A State may, pursuant to specific legislation enacted by
the legislative body of the State after the date of enactment
of the JOBS Act of 2011, use money transferred to the State
account of such State under this subsection for (i) the payment
of unemployment compensation, (ii) the repayment of advances
made to such State under section 1201 (including interest
thereon), and (iii) reemployment services designed to enhance
the rapid reemployment of unemployed workers (such as mandatory
workshops, claimant assessments, resume preparation and job
search assistance, wage subsidy programs, eligibility reviews,
labor market information, development of a work-search plan,
and training), if and only if--
(I) the purposes and amounts are specified in the
law;
(II) the money is withdrawn and expended, for the
purpose described in clause (i), (ii), or (iii) (as the
case may be), after the date of enactment of the law;
and
(III) the use of the money is accounted for in
accordance with standards established by the Secretary
of Labor.
(4) Transfers under this subsection shall--
(A) to the extent that they relate to the amount set
forth in paragraph (2)(B)(i), be made within 10 days
after the date of enactment of this subsection; and
(B) to the extent that they relate to the amount set
forth in paragraph (2)(B)(ii), be made after September
30, 2011, and on or before October 10, 2011.
* * * * * * *
DATA STANDARDIZATION FOR IMPROVED DATA MATCHING
Standard Data Elements
Sec. 911. (a)(1) The Secretary of Labor, in consultation with
an interagency work group established by the Office of
Management and Budget, and considering State perspectives,
shall, by rule, designate standard data elements for any
category of information required under title III or this title.
(2) The standard data elements designated under paragraph (1)
shall, to the extent practicable, be nonproprietary and
interoperable.
(3) In designating standard data elements 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 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 government perspectives,
shall, by rule, designate data reporting standards to govern
the reporting required under title III or this title.
(2) The data reporting standards required by paragraph (1)
shall, to the extent practicable--
(A) incorporate a widely-accepted, non-proprietary,
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 Business Reporting Language.
* * * * * * *
TITLE XII--ADVANCES TO STATE UNEMPLOYMENT FUNDS
* * * * * * *
REPAYMENT BY STATES OF ADVANCES TO STATE UNEMPLOYMENT FUNDS
Sec. 1202. (a) * * *
(b)(1) * * *
(2) No interest shall be required to be paid under paragraph
(1) with respect to any advance or advances made during any
calendar year if--
(A) such advances are repaid in full before the close
of September 30 of the calendar year in which the
advances revere made, and
(B) no other advance was made to such State under
section 1201 during such calendar year and after the
date on which the repayment of the advances was
completed[, and].
[(C) such State meets funding goals, established
under regulations issued by the Secretary of Labor,
relating to the accounts of the States in the
Unemployment Trust Fund.]
* * * * * * *
----------
INTERNAL REVENUE CODE OF 1986
* * * * * * *
Subtitle C--Employment Taxes
* * * * * * *
CHAPTER 23--FEDERAL UNEMPLOYMENT TAX ACT
* * * * * * *
SEC. 3304. APPROVAL OF STATE LAWS.
(a) Requirements.--The Secretary of Labor shall approve any
State law submitted to him, within 30 days of such submission,
which he finds provides that--
(1) * * *
* * * * * * *
(4) all money withdrawn from the unemployment fund of
the State shall be used solely in the payment of
unemployment compensation, exclusive of expenses of
administration, and for refunds of sums erroneously
paid into such fund and refunds paid in accordance with
the provisions of section 3305(b); except that--
(A) * * *
* * * * * * *
(D) amounts [may] shall be deducted from
unemployment benefits and used to repay
overpayments as provided in section 303(g) of
the Social Security Act;
* * * * * * *
[(8) 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);]
(8) compensation shall not be denied to an individual
for any week in which the individual is enrolled and
making satisfactory progress in education or training
which has been previously approved by the State agency;
* * * * * * *
----------
SUPPLEMENTAL APPROPRIATIONS ACT, 2008
* * * * * * *
TITLE IV--EMERGENCY UNEMPLOYMENT COMPENSATION
FEDERAL-STATE AGREEMENTS
Sec. 4001. (a) * * *
* * * * * * *
[(g) Nonreduction Rule.--An agreement under this section
shall not apply (or shall cease to apply) with respect to a
State upon a determination by the Secretary that the method
governing the computation of regular compensation under the
State law of that State has been modified in a manner such
that--
[(1) the average weekly benefit amount of regular
compensation which will be payable during the period of
the agreement occurring on or after June 2, 2010
(determined disregarding any additional amounts
attributable to the modification described in section
2002(b)(1) of the Assistance for Unemployed Workers and
Struggling Families Act, as contained in Public Law
111-5 (26 U.S.C. 3304 note; 123 Stat. 438)), will be
less than
[(2) the average weekly benefit amount of regular
compensation which would otherwise have been payable
during such period under the State law, as in effect on
June 2, 2010.]
* * * * * * *
[PAYMENTS TO STATES HAVING AGREEMENTS FOR THE PAYMENT OF EMERGENCY
UNEMPLOYMENT COMPENSATION
[Sec. 4003. (a) General Rule.--There shall be paid to each
State that has entered into an agreement under this title an
amount equal to 100 percent of the emergency unemployment
compensation paid to individuals by the State pursuant to such
agreement.
[(b) Treatment of Reimbursable Compensation.--No payment
shall be made to any State under this section in respect of any
compensation to the extent the State is entitled to
reimbursement in respect of such compensation under the
provisions of any Federal law other than this title or chapter
85 of title 5, United States Code. A State shall not be
entitled to any reimbursement under such chapter 85 in respect
of any compensation to the extent the State is entitled to
reimbursement under this title in respect of such compensation.
[(c) Determination of Amount.--Sums payable to any State by
reason of such State having an agreement under this title shall
be payable, either in advance or by way of reimbursement (as
may be determined by the Secretary), in such amounts as the
Secretary estimates the State will be entitled to receive under
this title 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.]
FINANCING PROVISIONS
Sec. 4004. (a) * * *
* * * * * * *
(e) Transfer of Funds.--Notwithstanding any other provision
of law, the Secretary of the Treasury shall transfer from the
general fund of the Treasury (from funds not otherwise
appropriated)--
(1) to the extended unemployment compensation account
(as established by section 905 of the Social Security
Act) such sums as the Secretary of Labor estimates to
be necessary to make payments to States under this
title by reason of--
(A) * * *
* * * * * * *
(F) the amendments made by section 2(a)(1) of
the Unemployment Compensation Extension Act of
2010; [and]
* * * * * * *
(H) the amendment made by section 201 of the
Jobs, Opportunity, Benefits, and Services Act
of 2011; and
* * * * * * *
----------
ASSISTANCE FOR UNEMPLOYED WORKERS AND STRUGGLING FAMILIES ACT
* * * * * * *
TITLE II--ASSISTANCE FOR UNEMPLOYED WORKERS AND STRUGGLING FAMILIES
* * * * * * *
Subtitle A--Unemployment Insurance
* * * * * * *
SEC. 2005. FULL FEDERAL FUNDING OF EXTENDED UNEMPLOYMENT COMPENSATION
FOR A LIMITED PERIOD.
(a) In General.--In the case of sharable extended
compensation and sharable regular compensation paid for weeks
of unemployment beginning after the date of the enactment of
this section and before [January 4, 2012] July 6, 2011, section
204(a)(1) of the Federal-State Extended Unemployment
Compensation Act of 1970 (26 U.S.C. 3304 note) shall be applied
by substituting ``100 percent of'' for ``one-half of''.
(b) Special Rule.--At the option of a State, for any weeks of
unemployment beginning after the date of the enactment of this
section and before [January 4, 2012] the date of enactment of
the JOBS Act of 2011, an individual's eligibility period (as
described in section 203(c) of the Federal-State Extended
Unemployment Compensation Act of 1970) shall, for purposes of
any determination of eligibility for extended compensation
under the State law of such State, be considered to include any
week which begins--
(1) * * *
* * * * * * *
[(c) Limited Extension.--In the case of an individual who
receives extended compensation with respect to 1 or more weeks
of unemployment beginning after the date of the enactment of
this Act and before January 4, 2012, the provisions of
subsections (a) and (b) shall, at the option of a State, be
applied by substituting ``ending before June 11, 2012'' for
``before January 4, 2012''.]
* * * * * * *
----------
FEDERAL-STATE EXTENDED UNEMPLOYMENT COMPENSATION ACT OF 1970
* * * * * * *
EXTENDED BENEFIT PERIOD
Beginning and Ending
Sec. 203. (a) * * *
* * * * * * *
State On and Off Indicators.--
(d) For purposes of this section--
(1) * * *
* * * * * * *
Effective with respect to compensation for weeks of
unemployment beginning after March 30, 1977 (or, if later, the
date established pursuant to State law), the State may by law
provide that the determination of whether there has been a
State ``on'' or ``off'' indicator beginning or ending any
extended benefit period shall be made under this subsection as
if (i) paragraph (1) did not contain subparagraph (A) thereof,
and (ii) the figure ``5'' contained in subparagraph (B) thereof
were ``6''; except that, notwithstanding any such provision of
State law, any week for which there would otherwise be a State
``on'' indicator shall continue to be such a week and shall not
be determined to be a week for which there is a State ``off''
indicator. Effective with respect to compensation for weeks of
unemployment beginning after the date of enactment of the Tax
Relief, Unemployment Insurance Reauthorization, and Job
Creation Act of 2010 (or, if later, the date established
pursuant to State law), and ending on or before [December 31,
2011] June 30, 2011, the State may by law provide that the
determination of whether there has been a state ``on'' or
``off'' indicator beginning or ending any extended benefit
period shall be made under this subsection as if the word
``two'' were ``three'' in subparagraph (1)(A). For purposes of
this subsection, the rate of insured unemployment for any
thirteen-week period shall be determined by reference to the
average monthly covered employment under the State law for the
first four of the most recent six calendar quarters ending
before the close of such period.
* * * * * * *
Alternative Trigger
(f)(1) * * *
(2) Effective with respect to compensation for weeks of
unemployment beginning after the date of enactment of the Tax
Relief, Unemployment Insurance Reauthorization, and Job
Creation Act of 2010 (or, if later, the date established
pursuant to State law), and ending on or before [December 31,
2011] June 30, 2011, the State may by law provide that the
determination of whether there has been a state ``on'' or
``off'' indicator beginning or ending any extended benefit
period shall be made under this subsection as if the word
``either'' were ``any'', the word ``both'' were ``all'', and
the figure ``2'' were ``3'' in clause (1)(A)(ii).
* * * * * * *
DISSENTING VIEWS
We oppose H.R. 1745 because the legislation ends the
current Federal guarantee of extended unemployment benefits for
America's long-term unemployed. Jeopardizing the unemployment
benefits of over four million Americans is the wrong path for
our Nation, and it reneges on legislation Republicans agreed to
less than six months ago to extend unemployment benefits in
exchange for continuing tax cuts for the wealthy.
Under the policies adopted by Democrats in Congress and
President Obama, our economy has created over two million new
private sector jobs over the last 14 months. By comparison,
during the last 14 months of President Bush's Administration,
the Nation lost over 3.7 million private sector jobs. But even
with this improvement, the job market remains tough for many
Americans. There are still roughly 7 million fewer jobs in the
economy today than when the ``Great Recession'' started in
December 2007. Data from the Department of Labor shows there
are about four and half unemployed individuals for every
available job. Additionally, the long-term unemployment rate
for the first four months of this year is at an historically
high level, with over 44 percent of the jobless without work
for at least six months.
During the markup of H.R. 1745, Members of the majority
suggested the legislation does not encourage States to
terminate unemployment benefits for Americans struggling to
find work. However, the bill clearly allows States to divert up
to $31 billion of Federal funds for extended unemployment
benefits toward other purposes. As Labor Secretary Hilda Solis
says in her letter opposing the legislation, ``H.R. 1745 could
end these crucial benefits by providing incentives for states
to eliminate these benefit programs altogether.''
The majority also suggested that the risk of unemployment
funds being diverted is moderated by the fact some States have
already ended their legislative sessions. Of course, these
States could come back into special session to change their
laws. Furthermore, a Governor could unilaterally end a State's
participation in the Emergency Unemployment Compensation (EUC)
program (without approval from the legislature) and wait for
the next legislative session to reach agreement on how to spend
the funds that have been diverted from paying extended
unemployment benefits.
The legislation makes it clear that one of the purposes
that States can divert Federal UI funds toward is paying all or
a portion of any outstanding loan the State has received from
the Federal Unemployment Trust Funds. We note that many
proposals have been put forward to address solvency issues
within the unemployment system, and we would have preferred a
genuine effort to find bipartisan consensus on the issue. In
this context, it is worth remembering that the Government
Accountability Office (GAO) informed the Committee last year
that State UI financing policies are a major factor behind
their current insolvency problems. More specifically, GAO
found, ``Long-standing UI tax policies and practices in many
States over 3 decades have eroded trust fund reserves, leaving
States in a weak position prior to the recent recession.'' The
report highlighted that ``While [unemployment] benefits over
the last 3 decades have remained largely flat relative to
wages, employer tax rates have declined.'' In terms of
restoring the solvency of the Federal Unemployment Trust Funds,
H.R. 1745 fails to continue an expiring source of funding that
has been in place for over 30 years and that has been routinely
extended with bipartisan support.
We also believe it is important to recognize that
unemployment benefits are not generous, with the average weekly
benefit of $300 reaching only 70 percent of the poverty line
for a family of four. Nevertheless, unemployment insurance
remains the difference between hardship and destitution for
millions of workers who have lost their jobs through no fault
of their own. Over four million jobless workers now depend on
Federal unemployment insurance and the legislation ends the
assurance that their benefits will continue. Furthermore, the
bill repeals a protection that prevents States from cutting the
cash amount of regular unemployment benefits when participating
in the EUC program. We also are concerned about proposals that
tie eligibility to education and training at a time when the
majority's budget proposals slash funding for education, job
training and employment services.
Finally, while the majority calls H.R. 1745 a jobs bill,
the legislation has nothing to do with creating jobs. In fact,
by diverting money from unemployment benefits to purposes with
less economic impact, the legislation could cost American jobs.
An analysis by the Economic Policy Institute points out that if
every State used the unemployment funds for debt repayment or
trust fund solvency instead of continuing extended benefits,
322,000 jobs could be lost due to the decline in economic
activity associated with the expenditure of UI benefits. Of
course, if only some States pursued that course, the negative
impact would be smaller, but there could still be a harmful
effect on job growth.
We therefore oppose H.R. 1745 as a bill that could
negatively impact job creation, hurt unemployed Americans, and
take the wrong step in addressing long-term solvency for the
Unemployment Insurance system. The Republican majority should
refrain from blaming the unemployed for unemployment and join
with us in working to continue to create jobs.
Sander Levin.
John Lewis.
Shelley Berkley.
Bill Pascrell, Jr.
John B. Larson.
Jim McDermott.
Earl Blumenauer.
Lloyd Doggett.
Pete Stark.
Joe Crowley.
Charles B. Rangel.
Ron Kind.
Mike Thompson.
Xavier Becerra.