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[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2233 Introduced in House (IH)]

110th CONGRESS
  1st Session
                                H. R. 2233

To provide for special transfers of funds to States to promote certain 
         improvements in State unemployment compensation laws.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                              May 9, 2007

Mr. McDermott introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL

 
To provide for special transfers of funds to States to promote certain 
         improvements in State unemployment compensation laws.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Unemployment Insurance Modernization 
Act''.

SEC. 2. SPECIAL TRANSFERS TO STATE ACCOUNTS IN THE UNEMPLOYMENT TRUST 
              FUND.

    (a) In General.--Section 903 of the Social Security Act (42 U.S.C. 
1103) is amended by adding at the end the following:

``Special Transfers in Fiscal Years 2008 Through 2012 for Modernization

    ``(f)(1)(A) In addition to any other amounts, the Secretary of 
Labor shall provide for the making of unemployment compensation 
modernization incentive payments (hereinafter `incentive payments') to 
the accounts of the States in the Unemployment Trust Fund, by transfer 
from amounts reserved for that purpose in the Federal unemployment 
account, in accordance with succeeding provisions of this subsection.
    ``(B) The maximum incentive payment allowable under this subsection 
with respect to any State shall, as determined by the Secretary of 
Labor, be equal to the amount obtained by multiplying $7,000,000,000 
times the same ratio as is applicable under subsection (a)(2)(B) for 
purposes of determining such State's share of any funds to be 
transferred under subsection (a) as of October 1, 2007.
    ``(C) Of the maximum incentive payment determined under 
subparagraph (B) with respect to a State--
            ``(i) one-third shall be transferred to the account of such 
        State upon a certification under paragraph (4)(B) that the 
        State law of such State meets the requirements of paragraph 
        (2); and
            ``(ii) the remainder shall be transferred to the account of 
        such State upon a certification under paragraph (4)(B) that the 
        State law of such State meets the requirements of paragraph 
        (3).
    ``(2) The State law of a State meets the requirements of this 
paragraph if such State law--
            ``(A) uses a base period that includes the most recently 
        completed calendar quarter before the start of the benefit year 
        for purposes of determining eligibility for unemployment 
        compensation; or
            ``(B) provides that, in the case of an individual who would 
        not otherwise be eligible for unemployment compensation under 
        the State law because of the use of a base period that does not 
        include the most recently completed calendar quarter before the 
        start of the benefit year, eligibility shall be determined 
        using a base period that includes such calendar quarter.
    ``(3) The State law of a State meets the requirements of this 
paragraph if such State law includes provisions to carry out at least 2 
of the following subparagraphs:
            ``(A) An individual shall not be denied regular 
        unemployment compensation under any State law provisions 
        relating to availability for work, active search for work, or 
        refusal to accept work, solely because such individual is 
        seeking only part-time (and not full-time) work, except that 
        the State law provisions carrying out this subparagraph may 
        exclude an individual if a majority of the weeks of work in 
        such individual's base period do not include part-time work.
            ``(B) An individual shall not be disqualified from regular 
        unemployment compensation for separating from employment if 
        that separation is for compelling family reasons. For purposes 
        of this subparagraph, the term `compelling family reasons' 
        includes at least the following:
                    ``(i) Domestic violence (verified by such 
                reasonable and confidential documentation as the State 
                law may require) which causes the individual reasonably 
                to believe that such individual's continued employment 
                would jeopardize the safety of the individual or of any 
                member of the individual's immediate family.
                    ``(ii) The illness or disability of a member of the 
                individual's immediate family.
                    ``(iii) The need for the individual to accompany 
                such individual's spouse--
                            ``(I) to a place from which it is 
                        impractical for such individual to commute; and
                            ``(II) due to a change in location of the 
                        spouse's employment.
            ``(C) Weekly unemployment compensation is payable under 
        this subparagraph to any individual who is unemployed (as 
        determined under the State unemployment compensation law), has 
        exhausted all rights to regular and (if applicable) extended 
        unemployment compensation under the State law, and is enrolled 
        and making satisfactory progress in a State-approved training 
        program or in a job training program authorized under the 
        Workforce Investment Act of 1998. Such program shall prepare 
        individuals who have been separated from a declining 
        occupation, or who have been involuntarily and indefinitely 
        separated from employment as a result of a permanent reduction 
        of operations at the individual's place of employment, for 
        entry into a high-demand occupation. The amount of unemployment 
        compensation payable under this subparagraph to an individual 
        for a week of unemployment shall be equal to the individual's 
        average weekly benefit amount (including dependents' 
        allowances) for the most recent benefit year, and the total 
        amount of unemployment compensation payable under this 
        subparagraph to any individual shall be equal to at least 26 
        times the individual's average weekly benefit amount (including 
        dependents' allowances) for the most recent benefit year.
    ``(4)(A) Any State seeking an incentive payment under this 
subsection shall submit an application therefor at such time, in such 
manner, and complete with such information as the Secretary of Labor 
may by regulation prescribe, including information relating to 
compliance with the requirements of paragraph (2) or (3), as well as 
how the State intends to use the incentive payment to improve or 
strengthen the State's unemployment compensation program. The Secretary 
of Labor shall, within 90 days after receiving a complete application, 
notify the State agency of the State of the Secretary's findings with 
respect to the requirements of paragraph (2) or (3) (or both).
    ``(B) If the Secretary of Labor finds that the State law provisions 
(disregarding any State law provisions which are not then currently in 
effect as permanent law or which are subject to discontinuation under 
certain conditions) meet the requirements of paragraph (2) or (3), as 
the case may be, the Secretary of Labor shall thereupon make a 
certification to that effect to the Secretary of the Treasury, together 
with a certification as to the amount of the incentive payment to be 
transferred to the State account pursuant to that finding. The 
Secretary of the Treasury shall make the appropriate transfer within 30 
days after receiving such certification.
    ``(C)(i) No certification of compliance with the requirements of 
paragraph (2) or (3) may be made with respect to any State whose State 
law is not otherwise eligible for certification under section 303 or 
approvable under section 3304 of the Federal Unemployment Tax Act.
    ``(ii) No certification of compliance with the requirements of 
paragraph (3) may be made with respect to any State whose State law is 
not in compliance with the requirements of paragraph (2).
    ``(iii) No application under subparagraph (A) may be considered if 
submitted before October 1, 2007, or after the latest date necessary 
(as specified by the Secretary of Labor in regulations) to ensure that 
all incentive payments under this subsection are made before October 1, 
2012.
    ``(5)(A) Except as provided in subparagraph (B), any amount 
transferred to the account of a State under this subsection may be used 
by such State only in the payment of cash benefits to individuals with 
respect to their unemployment (including for dependents' allowances and 
for unemployment compensation under paragraph (3)(C)), exclusive of 
expenses of administration.
    ``(B) A State may, subject to the same conditions as set forth in 
subsection (c)(2) (excluding subparagraph (B) thereof, and deeming the 
reference to `subsections (a) and (b)' in subparagraph (D) thereof to 
include this subsection), use any amount transferred to the account of 
such State under this subsection for the administration of its 
unemployment compensation law and public employment offices.
    ``(6) Out of any money in the Federal unemployment account not 
otherwise appropriated, the Secretary of the Treasury shall reserve 
$7,000,000,000 for incentive payments under this subsection. Any amount 
so reserved shall not be taken into account for purposes of any 
determination under section 902, 910, or 1203 of the amount in the 
Federal unemployment account as of any given time. Any amount so 
reserved for which the Secretary of the Treasury has not received a 
certification under paragraph (4)(B) by the deadline described in 
paragraph (4)(C)(iii) shall, upon the close of fiscal year 2012, become 
unrestricted as to use as part of the Federal unemployment account.
    ``(7) For purposes of this subsection, the terms `benefit year', 
`base period', and `week' have the respective meanings given such terms 
under section 205 of the Federal-State Extended Unemployment 
Compensation Act of 1970 (26 U.S.C. 3304 note).

       ``Special Transfers in Fiscal Years 2008 Through 2012 for 
                             Administration

    ``(g)(1) Notwithstanding any other provision of this section, the 
total amount available for transfer to the accounts of the States 
pursuant to subsection (a) as of the beginning of each of fiscal years 
2008, 2009, 2010, 2011, and 2012 shall be equal to the total amount 
which (disregarding this subsection) would otherwise be so available, 
increased by $100,000,000.
    ``(2) Each State's share of any additional amount made available by 
this subsection shall be determined, certified, and computed in the 
same manner as described in subsection (a)(2) and shall be subject to 
the same limitations on transfers as described in subsection (b). For 
purposes of applying subsection (b)(2), the balance of any advances 
made to a State under section 1201 shall be credited against, and 
operate to reduce (but not below zero)--
            ``(A) first, any additional amount which, as a result of 
        the enactment of this subsection, is to be transferred to the 
        account of such State in a fiscal year; and
            ``(B) second, any amount which (disregarding this 
        subsection) is otherwise to be transferred to the account of 
        such State pursuant to subsections (a) and (b) in such fiscal 
        year.
    ``(3) Any additional amount transferred to the account of a State 
as a result of the enactment of this subsection--
            ``(A) may be used by the State agency of such State only in 
        the payment of expenses incurred by it for--
                    ``(i) the administration of the provisions of its 
                State law carrying out the purposes of subsection 
                (f)(2) or any subparagraph of subsection (f)(3);
                    ``(ii) improved outreach to individuals who might 
                be eligible for regular unemployment compensation by 
                virtue of any provisions of the State law which are 
                described in clause (i);
                    ``(iii) the improvement of unemployment benefit and 
                unemployment tax operations; and
                    ``(iv) staff-assisted reemployment services for 
                unemployment compensation claimants; and
            ``(B) shall be excluded from the application of subsection 
        (c).
    ``(4) The total additional amount made available by this subsection 
in a fiscal year shall be taken out of the amounts remaining in the 
employment security administration account after subtracting the total 
amount which (disregarding this subsection) is otherwise required to be 
transferred from such account in such fiscal year pursuant to 
subsections (a) and (b).''.
    (b) Regulations.--The Secretary of Labor may prescribe any 
regulations necessary to carry out the amendment made by subsection 
(a).

SEC. 3. EXTENSION OF FUTA TAX.

    Section 3301 of the Internal Revenue Code of 1986 (relating to rate 
of tax) is amended--
            (1) by striking ``2007'' in paragraph (1) and inserting 
        ``2012'', and
            (2) by striking ``2008'' in paragraph (2) and inserting 
        ``2013''.
                                 <all>
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