[House Report 118-277]
[From the U.S. Government Publishing Office]


118th Congress   }                                       {      Report
                        HOUSE OF REPRESENTATIVES
 1st Session     }                                       {     118-277

======================================================================



 
 BUILDING ON REEMPLOYMENT IMPROVEMENTS TO DELIVER GOOD EMPLOYMENT FOR 
                              WORKERS ACT

                                _______
                                

 November 21, 2023.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

Mr. Smith of Missouri, from the Committee on Ways and Means, submitted 
                             the following

                              R E P O R T

                        [To accompany H.R. 5861]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
bill (H.R. 5861) to extend reemployment services and 
eligibility assessments to all claimants for unemployment 
benefits, and for other purposes, having considered the same, 
reports favorably thereon with an amendment and recommends that 
the bill as amended do pass.

                                CONTENTS

                                                                   Page
  I. SUMMARY AND BACKGROUND...........................................2
          A. Purpose and Summary.................................     2
          B. Background and Need for Legislation.................     2
          C. Legislative History.................................     3
          D. Designated Hearing..................................     4
 II. EXPLANATION OF THE BILL..........................................4
III. VOTE OF THE COMMITTEE............................................5
 IV. BUDGET EFFECTS OF THE BILL.......................................5
          A. Committee Estimate of Budgetary Effects.............     5
          B. Statement Regarding New Budget Authority and Tax 
              Expenditures Budget Authority......................     5
  V. COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET OFFICE........5
 VI. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE.......6
          A. Committee Oversight Findings and Recommendations....     6
          B. Statement of General Performance Goals and 
              Objectives.........................................     7
          C. Information Relating to Unfunded Mandates...........     7
          D. Congressional Earmarks, Limited Tax Benefits, and 
              Limited Tariff Benefits............................     7
          E. Tax Complexity Analysis.............................     7
          F. Duplication of Federal Programs.....................     7

VII. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED............7
          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...................................     7

    The amendment is as follows:
    Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Building on Reemployment Improvements 
to Deliver Good Employment for Workers Act'' or the ``BRIDGE for 
Workers Act''.

SEC. 2. ELIGIBILITY FOR REEMPLOYMENT SERVICES.

  (a) In General.--Section 306(a) of the Social Security Act (42 U.S.C. 
506(a)) is amended--
          (1) by striking ``individuals referred to reemployment 
        services as described in section 303(j)'' and inserting 
        ``claimants for regular compensation, including claimants 
        referred to reemployment services as described in section 
        303(j),''; and
          (2) by striking ``such individuals'' and inserting ``such 
        claimants''.
  (b) Effective Date.--The amendments made by subsection (a) shall take 
effect on the date of enactment of this Act.

                       I. SUMMARY AND BACKGROUND


                         A. Purpose and Summary

    H.R. 5861, as amended, the ``Building Reemployment 
Improvements to Deliver Good Employment for Workers Act, or 
BRIDGE for Workers Act,'' as ordered reported by the Committee 
on Ways and Means on November 2, 2023, modifies Reemployment 
Services and Eligibility Assessment (RESEA) grants to allow 
states and territories to provide services to any recipient of 
unemployment insurance benefits who could return to work more 
quickly, if provided with services. Introduced jointly by Rep. 
Darin LaHood (R-IL) and Rep. Danny Davis (D-IL), this bill 
makes a technical correction to the RESEA program to help more 
unemployed workers get back into the workforce more quickly.

                 B. Background and Need for Legislation

    The Unemployment Insurance (UI) program is a federal-state 
partnership to provide earned benefits to individuals who lose 
their job through no fault of their own. RESEA pairs weekly UI 
benefits with services to improve program integrity and provide 
workers who might otherwise struggle to find new jobs with 
tools that help them return to work, such as individualized 
career counseling, job search help, and local labor market 
information.
    RESEAs can also serve as an entry point to the workforce 
development system. Rigorous research conducted for the 
Department of Labor (DOL) found that RESEAs, and in particular, 
an approach which combined personalized assessment and the 
provision of reemployment services, were effective in 
increasing employment and reducing the duration of unemployment 
benefit receipt.\1\ Further research found that claimants were 
significantly less likely to exhaust their benefits; claimants 
had significantly shorter UI durations and lower total benefits 
paid (on average 1.82 fewer weeks and $536 lower total benefits 
paid); Claimants were more successful in returning to work 
sooner, earning higher wages in the measurement period, and 
retaining their jobs; and every $1.00 of cost produced $2.60 of 
savings.\2\
---------------------------------------------------------------------------
    \1\Michaelides et al. ``Impact of the Reemployment and Eligibility 
Assessment (REA) in Nevada.'' Impaq International, LLC. https://
www.impaqint.com/sites/default/files/files/
ETAOP_2012_08_REA_Nevada_Follow_up_Report.pdf.
    \2\``Reemployment Services and Eligibility Assessment Grants.'' 
Department of Labor. https://www.dol.gov/agencies/eta/american-job-
centers/RESEA.
---------------------------------------------------------------------------
    Between 2005 and 2018, Congress provided modest 
appropriated funding for RESEAs, which DOL then used to award 
grants to states and territories.\3\ Section 30206 of the 
Bipartisan Budget Act of 2018 (P.L. 115-123) codified the 
authority for the DOL to administer the RESEA program in a new 
Section 306 of the Social Security Act. It also set out various 
requirements for states to use certain types of evidence-based 
interventions for UI claimants under RESEA, provided for 
reasonable notice and accommodations to participating 
beneficiaries, allocated discretionary funding for RESEA across 
three categories (base funding, outcome payments, and research 
and technical assistance), and provided for a funding increase 
of $2.5 billion over 10 years. The Congressional Budget Office 
estimated that if the program were to be fully funded, the new 
investments would reduce the budget deficit by $600 million 
between 2022 and 2027.
---------------------------------------------------------------------------
    \3\``How States are Using Reemployment Services and Eligibility 
Assessments.'' National Association of State Workforce Agencies. 
https://www.naswa.org/news/how-states-are-using-reemployment-services-
and-eligibility-assessments-resea-march-27-2019.
---------------------------------------------------------------------------
    Notwithstanding Congressional intent, DOL has interpreted 
the underlying statute as limiting states to providing 
reemployment services only to unemployment claimants who are 
profiled as most likely to exhaust their unemployment benefits 
before finding work. However, since 2018, appropriations bills 
have included language to accomplish the change made by this 
bill, clarifying states may serve any UI claimants through 
RESEA programs.
    In a survey conducted by the National Association of State 
Workforce Agencies (NASWA), 59 percent of states said they were 
using the temporary flexibility to serve a wider array of 
workers. NASWA Board President Jon Pierpont wrote to the 
Committee:
    ``Until the passage of the [Bipartisan Budget] Act, federal 
RESEA had been limited to a widely successful pilot grant 
program. Today, States around the nation now have the ability 
to accelerate unemployment insurance (UI) claimants' transition 
back to employment faster than non-participants, which is 
particularly important in an economy desperately in need of 
skilled workers.
    To enhance these efforts, we encourage a minor statutory 
fix to the Act that reflects your intent to ensure any UI 
claimant, not just those most likely to exhaust their benefits, 
are eligible for RESEA services and assessments. The current 
language in Section 306 of Act needs to be modified to ensure 
this intent is actualized and while the Appropriations 
Committee made such a modification in their FYI9 Labor-HHS 
Appropriations bill, a permanent fix would provide clarity and 
stability for states actively focused on helping claimants 
return to work expeditiously.''

                         C. Legislative History


Background

    H.R. 5861 was introduced on October 2, 2023, and was 
referred to the Committee on Ways and Means. The BRIDGE for 
Workers Act was previously introduced in the 117th Congress by 
Rep. Darin LaHood (R-IL) (H.R. 3154) and in the 116th Congress 
by Rep. Stephanie Murphy (R-FL) and Rep. Jackie Walorski (R-IN) 
(H.R. 1759). In the 116th Congress, the bill was marked-up by 
the Committee on Ways and Means and subsequently passed the 
House under suspension (393-24) on April 9, 2019.

Committee Hearings

    The Committee has held the following hearings:
    On February 8, 2023, Committee on Ways and Means held a 
hearing titled, ``The Greatest Theft of Taxpayer Dollars: 
Unchecked Unemployment Fraud,'' to hear from federal oversight 
officials about fraudulent activity in the UI program and 
recommendations for improving program integrity.
    On September 14, 2023, the Committee held a Member Day 
hearing in which Rep. Chuck Edwards (R-NC) announced his 
intention to introduce legislation to strengthen work search 
and audit requirements in the UI program.

Committee Action

    The Committee on Ways and Means marked up H.R. 5861, the 
``BRIDGE for Workers Act'', on November 2, 2023, and ordered 
the bill, as amended, favorably reported (with a quorum being 
present).

                         D. Designated Hearing

    Pursuant to clause 3(c)(6) of rule XIII, the following 
hearing was used to develop and consider: ``The Greatest Theft 
of Taxpayer Dollars: Unchecked Unemployment Fraud'' hearing 
held on February 8, 2023.

                      II. EXPLANATION OF THE BILL


                           Reasons for Change

    Section 1. The Committee believes the title accurately 
reflects the content of the bill.
    Section 2. The Committee believes that allowing states and 
territories the flexibility to provide RESEA services to 
recipients of earned unemployment benefits who could return to 
work more quickly if provided with additional assistance is 
cost-effective and will benefit both workers and employers.

                       Explanation of Provisions

    Section 1. This section provides the short title, Building 
Reemployment Improvements to Deliver Good Employment for 
Workers Act or BRIDGE for Workers Act.
    Section 2. This section would amend Section 306(a) to 
define the population eligible for services under RESEA to 
include all recipients of regular and extended UC benefits, not 
just regular UC claimants identified through state UI worker 
profiling. With the change, states would be able to use RESEA 
funds to assist workers who could return to work more quickly 
if provided assistance, even if they are not profiled to 
exhaust all benefits.

                             Effective Date

    The bill would become effective upon enactment.

                       III. VOTE OF THE COMMITTEE

    In compliance with the Rules of the House of 
Representatives, the following statement is made concerning the 
vote of the Committee on Ways and Means during the markup 
consideration of H.R. 5861, the ``BRIDGE for Workers Act'' on 
November 2, 2023.
    H.R. 5861 was ordered favorably reported to the House of 
Representatives as amended by a roll call vote of 41 yeas to 0 
nays (with a quorum being present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
         Representative             Yea       Nay     Present     Representative      Yea       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Smith (MO).................        X   ........  .........  Mr. Neal.........        X   ........  .........
Mr. Buchanan...................        X   ........  .........  Mr. Doggett......        X   ........  .........
Mr. Smith (NE).................        X   ........  .........  Mr. Thompson.....        X   ........  .........
Mr. Kelly......................        X   ........  .........  Mr. Larson.......  ........  ........  .........
Mr. Schweikert.................        X   ........  .........  Mr. Blumenauer...        X   ........  .........
Mr. LaHood.....................        X   ........  .........  Mr. Pascrell.....  ........  ........  .........
Dr. Wenstrup...................        X   ........  .........  Mr. Davis........        X   ........  .........
Mr. Arrington..................        X   ........  .........  Ms. Sanchez......        X   ........  .........
Dr. Ferguson...................        X   ........  .........  Mr. Higgins......        X   ........  .........
Mr. Estes......................        X   ........  .........  Ms. Sewell.......        X   ........  .........
Mr. Smucker....................        X   ........  .........  Ms. DelBene......        X   ........  .........
Mr. Hern.......................        X   ........  .........  Ms. Chu..........        X   ........  .........
Ms. Miller.....................        X   ........  .........  Ms. Moore........        X   ........  .........
Dr. Murphy.....................        X   ........  .........  Mr. Kildee.......        X   ........  .........
Mr. Kustoff....................        X   ........  .........  Mr. Beyer........        X   ........  .........
Mr. Fitzpatrick................        X   ........  .........  Mr. Evans........        X   ........  .........
Mr. Steube.....................        X   ........  .........  Mr. Schneider....  ........  ........  .........
Ms. Tenney.....................        X   ........  .........  Mr. Panetta......        X   ........  .........
Mrs. Fischbach.................        X
Mr. Moore......................        X
Mrs. Steel.....................        X
Ms. Van Duyne..................        X
Mr. Feenstra...................        X
Ms. Malliotakis................        X
Mr. Carey......................        X
----------------------------------------------------------------------------------------------------------------

                     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 bill, H.R. 5861, as 
reported. The estimate prepared by the Congressional Budget 
Office (CBO) is included below.

B. Statement Regarding New Budget Authority and Tax Expenditures Budget 
                               Authority

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee states that the 
bill involves no new or increased budget authority. The 
Committee states further that the bill involves no new or 
increased tax expenditures.

      V. 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.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    H.R. 5861 would broaden eligibility for reemployment 
services and eligibility assessments (RESEAs) that are carried 
out by the Department of Labor (DOL). Current law requires 
states to provide services to claimants who are likely to 
exhaust unemployment compensation, but states have broad 
flexibility in how they determine whether a claimant is likely 
to exhaust benefits. Beginning in 2019, annual appropriation 
acts have allowed states to conduct RESEAs for all unemployment 
claimants without determining that they are likely to exhaust 
benefits; H.R. 5861 would permanently allow states this 
flexibility. In 2023, appropriations for RESEAs totaled $375 
million.
    CBO expects that under H.R. 5861, states would continue to 
provide reemployment services to people they believe are likely 
to exhaust unemployment insurance benefits to meet DOL's 
requirements for participant outcomes. Using information from 
DOL, CBO expects that implementing H.R. 5861 would not 
significantly change the number of people who receive 
reemployment services and eligibility assessments or the cost 
of those services. On that basis, CBO estimates that 
implementing H.R. 5861 would cost less than $500,000 over the 
2024-2028 period; any spending would be subject to the 
availability of appropriated funds.
    The CBO staff contact for this estimate is Meredith Decker. 
The estimate was reviewed by H. Samuel Papenfuss, Deputy 
Director of Budget Analysis.
                                         Phillip L. Swagel,
                             Director, Congressional Budget Office.

     VI. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE


          A. Committee Oversight Findings and Recommendations

    With respect to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives, the Committee made findings and 
recommendations that are reflected in this report.

        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 does not authorize funding, so no statement of general 
performance goals and objectives 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 bill does not contain 
Federal mandates on the private sector. The Committee has 
determined that the bill does not impose a Federal 
intergovernmental mandate on State, local, or tribal 
governments.

  D. 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 provisions 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.

                       E. Tax Complexity Analysis

    Pursuant to clause 3(h)(1) of rule XIII of the Rules of the 
House of Representatives, the staff of the Joint Committee on 
Taxation has determined that a complexity analysis is not 
required under section 4022(b) of the IRS Reform Act because 
the bill contains no provisions that amend the Internal Revenue 
Code of 1986 and that have ``widespread applicability'' to 
individuals or small businesses, within the meaning of the 
rule.

                   F. Duplication of Federal Programs

    In compliance with clause 3(c)(5) of rule XIII of the Rules 
of the House of Representatives, the Committee states that no 
provision of the bill establishes or reauthorizes: (1) a 
program of the Federal Government known to be duplicative of 
another Federal program; (2) a program included in any report 
from the Government Accountability Office to Congress pursuant 
to section 21 of Public Law 111-139; or (3) a program related 
to a program identified in the most recent Catalog of Federal 
Domestic Assistance, published pursuant to the Federal Program 
Information Act (Pub. L. No. 95-220, as amended by Pub. L. No. 
98-169).

       VII. 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.

         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 italics, and existing law in which no 
change is proposed is shown in roman):

                          SOCIAL SECURITY ACT




           *       *       *       *       *       *       *
       TITLE III--GRANTS TO STATES FOR UNEMPLOYMENT COMPENSATION 
ADMINISTRATION

           *       *       *       *       *       *       *



SEC. 306. GRANTS TO STATES FOR REEMPLOYMENT SERVICES AND ELIGIBILITY 
                    ASSESSMENTS.

  (a) In General.--The Secretary of Labor (in this section 
referred to as the ``Secretary'') shall award grants under this 
section for a fiscal year to eligible States to conduct a 
program of reemployment services and eligibility assessments 
for [individuals referred to reemployment services as described 
in section 303(j)] claimants for regular compensation, 
including claimants referred to reemployment services as 
described in section 303(j), for weeks in such fiscal year for 
which [such individuals] such claimants receive unemployment 
compensation.
  (b) Purposes.--The purposes of this section are to accomplish 
the following goals:
          (1) To improve employment outcomes of individuals 
        that receive unemployment compensation and to reduce 
        the average duration of receipt of such compensation 
        through employment.
          (2) To strengthen program integrity and reduce 
        improper payments of unemployment compensation by 
        States through the detection and prevention of such 
        payments to individuals who are not eligible for such 
        compensation.
          (3) To promote alignment with the broader vision of 
        the Workforce Innovation and Opportunity Act (29 U.S.C. 
        3101 et seq.) of increased program integration and 
        service delivery for job seekers, including claimants 
        for unemployment compensation.
          (4) To establish reemployment services and 
        eligibility assessments as an entry point for 
        individuals receiving unemployment compensation into 
        other workforce system partner programs.
  (c) Evidence-based Standards.--
          (1) In general.--In carrying out a State program of 
        reemployment services and eligibility assessments using 
        grant funds awarded to the State under this section, a 
        State shall use such funds only for interventions 
        demonstrated to reduce the number of weeks for which 
        program participants receive unemployment compensation 
        by improving employment outcomes for program 
        participants.
          (2) Expanding evidence-based interventions.--In 
        addition to the requirement imposed by paragraph (1), a 
        State shall--
                  (A) for fiscal years 2023 and 2024, use no 
                less than 25 percent of the grant funds awarded 
                to the State under this section for 
                interventions with a high or moderate causal 
                evidence rating that show a demonstrated 
                capacity to improve employment and earnings 
                outcomes for program participants;
                  (B) for fiscal years 2025 and 2026, use no 
                less than 40 percent of such grant funds for 
                interventions described in subparagraph (A); 
                and
                  (C) for fiscal years beginning after fiscal 
                year 2026, use no less than 50 percent of such 
                grant funds for interventions described in 
                subparagraph (A).
  (d) Evaluations.--
          (1) Required evaluations.--Any intervention without a 
        high or moderate causal evidence rating used by a State 
        in carrying out a State program of reemployment 
        services and eligibility assessments under this section 
        shall be under evaluation at the time of use.
          (2) Funding limitation.--A State shall use not more 
        than 10 percent of grant funds awarded to the State 
        under this section to conduct or cause to be conducted 
        evaluations of interventions used in carrying out a 
        program under this section (including evaluations 
        conducted pursuant to paragraph (1)).
  (e) State Plan.--
          (1) In general.--As a condition of eligibility to 
        receive a grant under this section for a fiscal year, a 
        State shall submit to the Secretary, at such time and 
        in such manner as the Secretary may require, a State 
        plan that outlines how the State intends to conduct a 
        program of reemployment services and eligibility 
        assessments under this section, including--
                  (A) assurances that, and a description of 
                how, the program will provide--
                          (i) proper notification to 
                        participating individuals of the 
                        program's eligibility conditions, 
                        requirements, and benefits, including 
                        the issuance of warnings and simple, 
                        clear notifications to ensure that 
                        participating individuals are fully 
                        aware of the consequences of failing to 
                        adhere to such requirements, including 
                        policies related to non-attendance or 
                        non-fulfillment of work search 
                        requirements; and
                          (ii) reasonable scheduling 
                        accommodations to maximize 
                        participation for eligible individuals;
                  (B) assurances that, and a description of 
                how, the program will conform with the purposes 
                outlined in subsection (b) and satisfy the 
                requirement to use evidence-based standards 
                under subsection (c), including--
                          (i) a description of the evidence-
                        based interventions the State plans to 
                        use to speed reemployment;
                          (ii) an explanation of how such 
                        interventions are appropriate to the 
                        population served; and
                          (iii) if applicable, a description of 
                        the evaluation structure the State 
                        plans to use for interventions without 
                        at least a moderate or high causal 
                        evidence rating, which may include 
                        national evaluations conducted by the 
                        Department of Labor or by other 
                        entities; and
                  (C) a description of any reemployment 
                activities and evaluations conducted in the 
                prior fiscal year, and any data collected on--
                          (i) characteristics of program 
                        participants;
                          (ii) the number of weeks for which 
                        program participants receive 
                        unemployment compensation; and
                          (iii) employment and other outcomes 
                        for program participants consistent 
                        with State performance accountability 
                        measures provided by the State 
                        unemployment compensation program and 
                        in section 116(b) of the Workforce 
                        Innovation and Opportunity Act (29 
                        U.S.C. 3141(b)).
          (2) Approval.--The Secretary shall approve any State 
        plan, that is timely submitted to the Secretary, in 
        such manner as the Secretary may require, that 
        satisfies the conditions described in paragraph (1).
          (3) Disapproval and revision.--If the Secretary 
        determines that a State plan submitted pursuant to this 
        subsection fails to satisfy the conditions described in 
        paragraph (1), the Secretary shall--
                  (A) disapprove such plan;
                  (B) provide to the State, not later than 30 
                days after the date of receipt of the State 
                plan, a written notice of such disapproval that 
                includes a description of any portion of the 
                plan that was not approved and the reason for 
                the disapproval of each such portion; and
                  (C) provide the State with an opportunity to 
                correct any such failure and submit a revised 
                State plan.
  (f) Allocation of Funds.--
          (1) Base funding.--
                  (A) In general.--For each fiscal year after 
                fiscal year 2020, the Secretary shall allocate 
                a percentage equal to the base funding 
                percentage for such fiscal year of the funds 
                made available for grants under this section 
                among the States awarded such a grant for such 
                fiscal year using a formula prescribed by the 
                Secretary based on the rate of insured 
                unemployment (as defined in section 203(e)(1) 
                of the Federal-State Extended Unemployment 
                Compensation Act of 1970 (26 U.S.C. 3304 note)) 
                in the State for a period to be determined by 
                the Secretary. In developing such formula with 
                respect to a State, the Secretary shall 
                consider the importance of avoiding sharp 
                reductions in grant funding to a State over 
                time.
                  (B) Base funding percentage.--For purposes of 
                subparagraph (A), the term ``base funding 
                percentage'' means--
                          (i) for fiscal years 2021 through 
                        2026, 89 percent; and
                          (ii) for fiscal years after 2026, 84 
                        percent.
          (2) Reservation for outcome payments.--
                  (A) In general.--Of the amounts made 
                available for grants under this section for 
                each fiscal year after 2020, the Secretary 
                shall reserve a percentage equal to the outcome 
                reservation percentage for such fiscal year for 
                outcome payments to increase the amount 
                otherwise awarded to a State under paragraph 
                (1). Such outcome payments shall be paid to 
                States conducting reemployment services and 
                eligibility assessments under this section 
                that, during the previous fiscal year, met or 
                exceeded the outcome goals provided in 
                subsection (b)(1) related to reducing the 
                average duration of receipt of unemployment 
                compensation by improving employment outcomes.
                  (B) Outcome reservation percentage.--For 
                purposes of subparagraph (A), the term 
                ``outcome reservation percentage'' means--
                          (i) for fiscal years 2021 through 
                        2026, 10 percent; and
                          (ii) for fiscal years after 2026, 15 
                        percent.
          (3) Reservation for research and technical 
        assistance.--Of the amounts made available for grants 
        under this section for each fiscal year after 2020, the 
        Secretary may reserve not more than 1 percent to 
        conduct research and provide technical assistance to 
        States.
          (4) Consultation and public comment.--Not later than 
        September 30, 2019, the Secretary shall--
                  (A) consult with the States and seek public 
                comment in developing the allocation formula 
                under paragraph (1) and the criteria for 
                carrying out the reservations under paragraph 
                (2); and
                  (B) make publicly available the allocation 
                formula and criteria developed pursuant to 
                subclause (A).
  (g) Notification to Congress.--Not later than 90 days prior 
to making any changes to the allocation formula or the criteria 
developed pursuant to subsection (f)(5)(A), the Secretary shall 
submit to Congress, including to the Committee on Ways and 
Means and the Committee on Appropriations of the House of 
Representatives and the Committee on Finance and the Committee 
on Appropriations of the Senate, a notification of any such 
change.
  (h) Supplement Not Supplant.--Funds made available to carry 
out this section shall be used to supplement the level of 
Federal, State, and local public funds that, in the absence of 
such availability, would be expended to provide reemployment 
services and eligibility assessments to individuals receiving 
unemployment compensation, and in no case to supplant such 
Federal, State, or local public funds.
  (i) Definitions.--In this section:
          (1) Causal evidence rating.--The terms ``high causal 
        evidence rating'' and ``moderate causal evidence 
        rating'' shall have the meaning given such terms by the 
        Secretary of Labor.
          (2) Eligible state.--The term ``eligible State'' 
        means a State that has in effect a State plan approved 
        by the Secretary in accordance with subsection (e).
          (3) Intervention.--The term ``intervention'' means a 
        service delivery strategy for the provision of State 
        reemployment services and eligibility assessment 
        activities under this section.
          (4) State.--The term ``State'' has the meaning given 
        the term in section 205 of the Federal-State Extended 
        Unemployment Compensation Act of 1970 (26 U.S.C. 3304 
        note).
          (5) Unemployment compensation.--The term unemployment 
        compensation means ``regular compensation'', ``extended 
        compensation'', and ``additional compensation'' (as 
        such terms are defined by section 205 of the Federal-
        State Extended Unemployment Compensation Act of 1970 
        (26 U.S.C. 3304 note)).

           *       *       *       *       *       *       *


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