To provide for a program of temporary enhanced unemployment benefits.

Summary: Temporary Unemployment Compensation Act of 2001 - Provides for a program of temporary supplemental unemployment compensation (TSUC).Sets forth TSUC program requirements for Federal-State agreements, formulas for determining amounts in individual TSUC accounts and weekly benefits, payments to States, and financing. Includes among eligibility requirements an individual's not having rights, with respect to a week, to other compensation (excluding extended compensation).Applies TSUC agreements to weeks of unemployment: (1) beginning after the date on which such an agreement is entered into; and (2) ending before January 1, 2003. Makes a modification relating to part-time employment and increased benefits applicable to weeks of unemployment in such TSUC agreement period, regardless of the date on which an individual's claim for benefits is filed. Makes a modification relating to alternative base periods applicable only to initial claims filed after September 11, 2001. Makes TSUC payments applicable only to individuals exhausting their rights to regular compensation after September 11, 2001.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Temporary Unemployment Compensation 
Act of 2001''.

SEC. 2. FEDERAL-STATE AGREEMENTS.

    (a) In General.--Any State which desires to do so may enter into 
and participate in an agreement under this Act with the Secretary of 
Labor (hereinafter in this Act referred to as the ``Secretary''). Any 
State which is a party to an agreement under this Act may, upon 
providing 30 days' written notice to the Secretary, terminate such 
agreement.
    (b) Provisions of Agreement.--
            (1) In general.--Any agreement under subsection (a) shall 
        provide that the State agency of the State will make--
                    (A) payments of regular compensation to individuals 
                in amounts and to the extent that they would be 
                determined if the State law were applied with the 
                modifications described in paragraph (2), and
                    (B) payments of temporary supplemental unemployment 
                compensation to individuals who--
                            (i) have exhausted all rights to regular 
                        compensation under the State law,
                            (ii) do not, with respect to a week, have 
                        any rights to compensation (excluding extended 
                        compensation) under the State law of any other 
                        State (whether one that has entered into an 
                        agreement under this Act or otherwise) nor 
                        compensation under any other Federal law (other 
                        than under the Federal-State Extended 
                        Unemployment Compensation Act of 1970), and are 
                        not paid or entitled to be paid any additional 
                        compensation under any State or Federal law, 
                        and
                            (iii) are not receiving compensation with 
                        respect to such week under the unemployment 
                        compensation law of Canada.
            (2) Modifications described.--The modifications described 
        in this paragraph are as follows:
                    (A) An individual shall be eligible for regular 
                compensation if the individual would be so eligible, 
                determined by applying--
                            (i) the base period that would otherwise 
                        apply under the State law if this Act had not 
                        been enacted, or
                            (ii) a base period ending at the close of 
                        the calendar quarter most recently completed 
                        before the date of the individual's application 
                        for benefits,
                whichever results in the greater amount.
                    (B) An individual shall not be denied regular 
                compensation under the State law's provisions relating 
                to availability for work, active search for work, or 
                refusal to accept work, solely by virtue of the fact 
                that such individual is seeking, or available for, only 
                part-time (and not full-time) work.
                    (C) The amount of regular compensation (including 
                dependents' allowances) payable for any week shall be 
                equal to the amount determined under the State law 
                (before the application of this subparagraph), plus an 
                additional--
                            (i) 15 percent, or
                            (ii) $25,
                whichever is greater.
    (c) Nonreduction Rule.--Under the agreement, subsection (b)(2)(C) 
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 way such that--
            (1) the average weekly amount of regular compensation which 
        will be payable during the period of the agreement (determined 
        disregarding the modifications described in subsection (b)(2)) 
        will be less than
            (2) the average weekly amount of regular compensation which 
        would otherwise have been payable during such period under the 
        State law, as in effect on September 11, 2001.
    (d) Coordination Rules.--
            (1) Regular compensation payable under a federal law.--The 
        modifications described in subsection (b)(2) shall also apply 
        in determining the amount of benefits payable under any Federal 
        law to the extent that those benefits are determined by 
        reference to regular compensation payable under the State law 
        of the State involved.
            (2) TSUC to serve as second-tier benefits.--Notwithstanding 
        any other provision of law, extended benefits shall not be 
        payable to any individual for any week for which temporary 
        supplemental unemployment compensation is payable to such 
        individual.
    (e) Exhaustion of Benefits.--For purposes of subsection 
(b)(1)(B)(i), an individual shall be considered to have exhausted such 
individual's rights to regular compensation under a State law when--
            (1) no payments of regular compensation can be made under 
        such law because such individual has received all regular 
        compensation available to such individual based on employment 
        or wages during such individual's base period, or
            (2) such individual's rights to such compensation have been 
        terminated by reason of the expiration of the benefit year with 
        respect to which such rights existed.
    (f) Weekly Benefit Amount, Terms and Conditions, etc. Relating to 
TSUC.--For purposes of any agreement under this Act--
            (1) the amount of temporary supplemental unemployment 
        compensation which shall be payable to an individual for any 
        week of total unemployment shall be equal to the amount of 
        regular compensation (including dependents' allowances) payable 
        to such individual under the State law for a week for total 
        unemployment during such individual's benefit year,
            (2) the terms and conditions of the State law which apply 
        to claims for regular compensation and to the payment thereof 
        shall apply to claims for temporary supplemental unemployment 
        compensation and the payment thereof, except where inconsistent 
        with the provisions of this Act or with the regulations or 
        operating instructions of the Secretary promulgated to carry 
        out this Act, and
            (3) the maximum amount of temporary supplemental 
        unemployment compensation payable to any individual for whom a 
        temporary supplemental unemployment compensation account is 
        established under section 3 shall not exceed the amount 
        established in such account for such individual.

SEC. 3. TEMPORARY SUPPLEMENTAL UNEMPLOYMENT COMPENSATION ACCOUNT.

    (a) In General.--Any agreement under this Act shall provide that 
the State will establish, for each eligible individual who files an 
application for temporary supplemental unemployment compensation, a 
temporary supplemental unemployment compensation account.
    (b) Amount in Account.--
            (1) In general.--The amount established in an account under 
        subsection (a) shall be equal to the lesser of--
                    (A) 50 percent of the total amount of regular 
                compensation (including dependents' allowances) payable 
                to him during his benefit year under such law, or
                    (B) 13 times his weekly benefit amount.
            (2) Weekly benefit amount.--For purposes of this 
        subsection, an individual's weekly benefit amount for any week 
        is the amount of regular compensation (including dependents' 
        allowances) under the State law payable to such individual for 
        such week for total unemployment.
            (3) Rule of construction.--For purposes of any computation 
        under paragraph (1) (and any determination of amount under 
        section 2(f)(1)), the modification described in section 
        2(b)(2)(C) (relating to increased benefits) shall be deemed to 
        have been in effect with respect to the entirety of the benefit 
        year involved.

SEC. 4. PAYMENTS TO STATES HAVING AGREEMENTS UNDER THIS ACT.

    (a) General Rule.--There shall be paid to each State which has 
entered into an agreement under this Act an amount equal to--
            (1) 100 percent of any regular compensation made payable to 
        individuals by such State by virtue of the modifications which 
        are described in section 2(b)(2) and deemed to be in effect 
        with respect to such State pursuant to section 2(b)(1)(A),
            (2) 100 percent of any regular compensation--
                    (A) which is paid to individuals by such State by 
                reason of the fact that its State law contains 
                provisions comparable to the modifications described in 
                section 2(b)(2)(A)-(B), but only
                    (B) to the extent that those amounts would, if such 
                amounts were instead payable by virtue of the State 
                law's being deemed to be so modified pursuant to 
                section 2(b)(1)(A), have been reimbursable under 
                paragraph (1), and
            (3) 100 percent of the temporary supplemental unemployment 
        compensation paid to individuals by the State pursuant to such 
        agreement.
    (b) Determination of Amount.--Sums under subsection (a) payable to 
any State by reason of such State having an agreement under this Act 
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 Act 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.
    (c) Administrative Expenses, etc.--There is hereby appropriated out 
of the employment security administration account of the Unemployment 
Trust Fund (as established by section 901(a) of the Social Security 
Act) $500,000,000 to reimburse States for the costs of the 
administration of agreements under this Act (including any improvements 
in technology in connection therewith) and to provide reemployment 
services to unemployment compensation claimants in States having 
agreements under this Act. Each State's share of the amount 
appropriated by the preceding sentence shall be determined by the 
Secretary according to the factors described in section 302(a) of the 
Social Security Act and certified by the Secretary to the Secretary of 
the Treasury.

SEC. 5. FINANCING PROVISIONS.

    (a) In General.--Funds in the extended unemployment compensation 
account (as established by section 905(a) of the Social Security Act), 
and the Federal unemployment account (as established by section 904(g) 
of the Social Security Act), of the Unemployment Trust Fund shall be 
used, in accordance with subsection (b), for the making of payments 
(described in section 4(a)) to States having agreements entered into 
under this Act.
    (b) Certification.--The Secretary shall from time to time certify 
to the Secretary of the Treasury for payment to each State the sums 
described in section 4(a) which are payable to such State under this 
Act. The Secretary of the Treasury, prior to audit or settlement by the 
General Accounting Office, shall make payments to the State in 
accordance with such certification by transfers from the extended 
unemployment compensation account (or, to the extent that there are 
insufficient funds in that account, from the Federal unemployment 
account) to the account of such State in the Unemployment Trust Fund.

SEC. 6. FRAUD AND OVERPAYMENTS.

    (a) In General.--If an individual knowingly has made, or caused to 
be made by another, a false statement or representation of a material 
fact, or knowingly has failed, or caused another to fail, to disclose a 
material fact, and as a result of such false statement or 
representation or of such nondisclosure such individual has received 
any regular compensation or temporary supplemental unemployment 
compensation under this Act to which he was not entitled, such 
individual--
            (1) shall be ineligible for any further benefits under this 
        Act in accordance with the provisions of the applicable State 
        unemployment compensation law relating to fraud in connection 
        with a claim for unemployment compensation, and
            (2) shall be subject to prosecution under section 1001 of 
        title 18, United States Code.
    (b) Repayment.--In the case of individuals who have received any 
regular compensation or temporary supplemental unemployment 
compensation under this Act to which they were not entitled, the State 
shall require such individuals to repay those benefits to the State 
agency, except that the State agency may waive such repayment if it 
determines that--
            (1) the payment of such benefits was without fault on the 
        part of any such individual, and
            (2) such repayment would be contrary to equity and good 
        conscience.
    (c) Recovery by State Agency.--
            (1) In general.--The State agency may recover the amount to 
        be repaid, or any part thereof, by deductions from any regular 
        compensation or temporary supplemental unemployment 
        compensation payable to such individual under this Act or from 
        any unemployment compensation payable to such individual under 
        any Federal unemployment compensation law administered by the 
        State agency or under any other Federal law administered by the 
        State agency which provides for the payment of any assistance 
        or allowance with respect to any week of unemployment, during 
        the 3-year period after the date such individuals received the 
        payment of the regular compensation or temporary supplemental 
        unemployment compensation to which they were not entitled, 
        except that no single deduction may exceed 50 percent of the 
        weekly benefit amount from which such deduction is made.
            (2) Opportunity for hearing.--No repayment shall be 
        required, and no deduction shall be made, until a determination 
        has been made, notice thereof and an opportunity for a fair 
        hearing has been given to the individual, and the determination 
        has become final.
    (d) Review.--Any determination by a State agency under this section 
shall be subject to review in the same manner and to the same extent as 
determinations under the State unemployment compensation law, and only 
in that manner and to that extent.

SEC. 7. DEFINITIONS.

    For purposes of this Act:
            (1) In general.--The terms ``compensation'', ``regular 
        compensation'', ``extended compensation'', ``additional 
        compensation'', ``benefit year'', ``base period'', ``State'', 
        ``State agency'', ``State law'', and ``week'' have the 
        respective meanings given such terms under section 205 of the 
        Federal-State Extended Unemployment Compensation Act of 1970, 
        subject to paragraph (2).
            (2) State law and regular compensation.--In the case of a 
        State entering into an agreement under this Act--
                    (A) ``State law'' shall be considered to refer to 
                the State law of such State, applied in conformance 
                with the modifications described in section 2(b)(2), 
                subject to section 2(c), and
                    (B) ``regular compensation'' shall be considered to 
                refer to such compensation, determined under its State 
                law (applied in the manner described in subparagraph 
                (A)),
        except as otherwise provided or where the context clearly 
        indicates otherwise.

SEC. 8. APPLICABILITY.

    (a) In General.--An agreement entered into under this Act shall 
apply to weeks of unemployment--
            (1) beginning after the date on which such agreement is 
        entered into, and
            (2) ending before January 1, 2003.
    (b) Specific Rules.--Under such an agreement--
            (1) the modification described in section 2(b)(2)(A) 
        (relating to alternative base periods) shall not apply except 
        in the case of initial claims filed after September 11, 2001,
            (2) the modifications described in section 2(b)(2)(B)-(C) 
        (relating to part-time employment and increased benefits, 
        respectively) shall apply to weeks of unemployment (described 
        in subsection (a)), irrespective of the date on which an 
        individual's claim for benefits is filed, and
            (3) the payments described in section 2(b)(1)(B) (relating 
        to temporary supplemental unemployment compensation) shall not 
        apply except in the case of individuals exhausting their rights 
        to regular compensation (as described in clause (i) thereof) 
        after September 11, 2001.