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[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 1826 Introduced in Senate (IS)]

109th CONGRESS
  1st Session
                                S. 1826

    To amend the Internal Revenue Code of 1986 to allow a credit to 
encourage employers to offer flexible and phased work opportunities to 
  older workers, to expand the credit for dependent care expenses to 
 cover eldercare expenses, to extend COBRA coverage for certain older 
workers who lose health insurance coverage due to a reduction in work, 
  to improve older workers' access to job training services, and for 
                            other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                            October 6, 2005

 Mr. Kohl (for himself and Mr. Durbin) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
    To amend the Internal Revenue Code of 1986 to allow a credit to 
encourage employers to offer flexible and phased work opportunities to 
  older workers, to expand the credit for dependent care expenses to 
 cover eldercare expenses, to extend COBRA coverage for certain older 
workers who lose health insurance coverage due to a reduction in work, 
  to improve older workers' access to job training services, and for 
                            other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Older Worker 
Opportunity Act''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
                        TITLE I--TAX INCENTIVES

Sec. 101. Tax credit for older workers in flexible and phased work 
                            programs.
Sec. 102. Expansion of dependent care credit to eldercare expenses.
                 TITLE II--COBRA CONTINUATION COVERAGE

Sec. 201. Extended COBRA continuation coverage for certain older 
                            workers.
                   TITLE III--EMPLOYMENT AND TRAINING

Sec. 301. Definitions.
Sec. 302. Statewide employment and training activities.
Sec. 303. Local employment and training activities.
Sec. 304. Performance measures.
Sec. 305. Reporting.
Sec. 306. Incentive grants.
             TITLE IV--FEDERAL TASK FORCE ON OLDER WORKERS

Sec. 401. Federal task force on older workers.

                        TITLE I--TAX INCENTIVES

SEC. 101. TAX CREDIT FOR OLDER WORKERS IN FLEXIBLE AND PHASED WORK 
              PROGRAMS.

    (a) Congress finds that--
            (1) most older workers expect to work past traditional 
        retirement age;
            (2) most older workers would prefer not to work a 
        traditional full-time schedule;
            (3) older workers' preference for flexible and phased work 
        is not matched by opportunities currently offered by employers;
            (4) many older workers would choose to work longer if they 
        were offered flexible and phased work opportunities, which 
        would also reduce employer costs by increasing employee 
        retention; and
            (5) many older workers would like to gradually transition 
        into retirement instead of taking full retirement immediately.
    (b) Flexible and Phased Work Credit.--Subpart D of part IV of 
subchapter A of chapter 1 of the Internal Revenue Code of 1986 
(relating to business related credits) is amended by adding at the end 
the following new section:

``SEC. 45N. FLEXIBLE AND PHASED WORK CREDIT.

    ``(a) In General.--For purposes of section 38, in the case of an 
eligible employer, the flexible and phased work credit determined under 
this section for the taxable year shall be equal to 40 percent of the 
qualified wages for such year.
    ``(b) Eligible Employer.--For purposes of this section, the term 
`eligible employer' means an employer which--
            ``(1) maintains a qualified trust (within the meaning of 
        section 401(a)), and
            ``(2) provides health insurance coverage (as defined in 
        section 9832(b)(1)(A)) to employees and pays no less than 60 
        percent of the cost of such health insurance coverage with 
        respect to each full-time employee receiving such coverage.
    ``(c) Qualified Wages Defined.--For purposes of this section--
            ``(1) Qualified wages.--The term `qualified wages' means 
        the wages paid or incurred by an eligible employer during the 
        taxable year to individuals whom at the time such wages are 
        paid or incurred--
                    ``(A) have attained the age of 59\1/2\, and
                    ``(B) are participating in a formal flexible work 
                program or a formal phased work program.
            ``(2) Wages.--
                    ``(A) In general.--The term `wages' has the meaning 
                given such term by subsection (b) of section 3306 
                (determined without regard to any dollar limitation 
                contained in such section).
                    ``(B) Other rules.--Rules similar to the rules of 
                paragraph (2) and (3) of section 51(c) shall apply for 
                purposes of this section.
                    ``(C) Termination.--The term `wages' shall not 
                include any amount paid or incurred to an individual 
                after December 31, 2010.
            ``(3) Only first $6,000 of wages per year taken into 
        account.--The amount of the qualified wages which may be taken 
        into account with respect to any individual shall not exceed 
        $6,000 per year.
    ``(d) Formal Flexible Work Program.--For purposes of this section--
            ``(1) In general.--The term `formal flexible work program' 
        means a program of an eligible employer--
                    ``(A) which consists of core time and flex time,
                    ``(B) under which core time does not exceed--
                            ``(i) 20 hours per week,
                            ``(ii) 3 days per week, or
                            ``(iii) 1,000 hours per year, and
                    ``(C) which meets the requirements of subsection 
                (f).
            ``(2) Core time.--The term `core time' means the specific 
        time--
                    ``(A) during which an employee is required to 
                perform services related to employment, and
                    ``(B) which is determined by the employer.
            ``(3) Flex time.--The term `flex time' means the time other 
        than core time--
                    ``(A) during which an employee is required to 
                perform services related to employment, and
                    ``(B) which is determined at the election of the 
                employee.
    ``(e) Formal Phased Work Program.--For purposes of this section, 
the term `formal phased work program' means--
            ``(1) a program of an eligible employer--
                    ``(A) under which the employer and an employee 
                enter into an agreement, in good faith, that the 
                employee's work schedule will be no more than 80 
                percent of the work schedule of a similarly situated 
                full-time employee, and
                    ``(B) which meets the requirements of subsection 
                (f), or
            ``(2) any phased retirement program of an eligible employer 
        which--
                    ``(A) is authorized by the Secretary, and
                    ``(B) meets the requirements of subsection (f).
    ``(f) Requirements.--A program shall not be considered a formal 
flexible work program or a formal phased work program under this 
section unless such program meets the following requirements:
            ``(1) Duration of program.--The program shall allow for 
        participation for a period of at least 1 year.
            ``(2) No change in health benefits.--With respect to a 
        participant whose work schedule is no less than 20 percent of 
        the work schedule of a similarly situated full-time employee--
                    ``(A) such participant shall be entitled to the 
                same health insurance coverage to which a similarly 
                situated full-time employee would be entitled,
                    ``(B) the employer shall contribute the same 
                percentage of the cost of health insurance coverage for 
                such participant as the employer would contribute for a 
                similarly situated full-time employee, and
                    ``(C) such participant shall be entitled to 
                participate in a retiree health benefits plan of the 
                employer in the same manner as a similarly situated 
                full-time employee, except that service credited under 
                the plan for any plan year shall be equal to the ratio 
                of the participant's work schedule during such year to 
                the work schedule of a similarly situated full-time 
                employee during such year.
            ``(3) No reduction in pension benefits.--
                    ``(A) Defined benefit plans.--
                            ``(i) A participant shall be entitled to 
                        participate in a defined benefit plan (within 
                        the meaning of section 414(j)) of the employer 
                        in the same manner as a similarly situated 
                        full-time employee.
                            ``(ii) Service credited to a participant 
                        under the plan for any plan year shall be equal 
                        to the ratio of the participant's work schedule 
                        during such year to the work schedule of a 
                        similarly situated full-time employee during 
                        such year.
                            ``(iii) If the plan uses final average 
                        earnings to determine benefits, final average 
                        earnings of the participant shall be no less 
                        than such earnings were before the participant 
                        entered the program.
                    ``(B) Defined contribution plans.--A participant 
                shall be entitled to participate in a defined 
                contribution plan (within the meaning of section 
                414(i)) of the employer in the same manner as a 
                similarly situated full-time employee, and the employer 
                shall match the participant's contributions at the same 
                rate that the employer would match the contributions of 
                a similarly situated full-time employee.
                    ``(C) No forfeiture of pension benefits.--The 
                pension benefits of a participant shall not be 
                forfeited under the rules of section 411(a)(3)(B) or 
                section 203(a)(3)(B) of the Employee Retirement Income 
                Security Act of 1974 with respect to a participant who 
                has attained normal retirement age as of the end of the 
                plan year.
            ``(4) Nondiscrimination rule.--Eligibility to participate 
        in the program shall not discriminate in favor of highly 
        compensated employees (within the meaning of section 414(q)).
    ``(g) Certain Individuals Ineligible.--For purposes of this 
section, rules similar to the rules of paragraphs (1) and (2) of 
section 51(i) and section 52 shall apply.
    ``(h) Regulations.--The Secretary may prescribe such regulations as 
are necessary to carry out the purposes of this section, including 
simplified rules to satisfy the requirements of subsection (f)(3)(C) 
taking into account the requirements of section 411 and section 203 of 
the Employee Retirement Income Security Act of 1974.''.
    (c) Credit Made Part of General Business Credit.--Subsection (b) of 
section 38 of the Internal Revenue Code of 1986 is amended by striking 
``and'' at the end of paragraph (25), by striking the period at the end 
of paragraph (26) and inserting ``, plus'', and by adding at the end 
the following new paragraph:
            ``(27) the flexible and phased work credit determined under 
        section 45N(a).''.
    (d) No Double Benefit.--Subsection (a) of section 280C of the 
Internal Revenue Code of 1986 is amended by inserting ``45N(a),'' after 
``45A(a),''.
    (e) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new item:

``Sec. 45N. Flexible and phased work credit.''.
    (f) Effective Date.--The amendments made by this section shall 
apply to wages paid after December 31, 2005.

SEC. 102. EXPANSION OF DEPENDENT CARE CREDIT TO ELDERCARE EXPENSES.

    (a) In General.--Paragraph (1) of section 21(b) of the Internal 
Revenue Code of 1986 (relating to qualifying individual) is amended by 
striking ``or'' at the end of subparagraph (B), by striking the period 
at the end of subparagraph (C) and inserting ``, or'', and by adding at 
the end the following new subparagraph:
                    ``(D) an individual who--
                            ``(i) has attained retirement age (as 
                        defined in section 216(l)(1) of the Social 
                        Security Act) before the end of the taxable 
                        year of the taxpayer,
                            ``(ii) is the spouse of the taxpayer or has 
                        a relationship to the taxpayer described in 
                        subparagraph (B), (C), (D), (F), or (G) of 
                        section 152(d)(2), and
                            ``(iii) is a chronically ill individual 
                        (within the meaning of section 7702B(c)(2)).''.
    (b) Expenses for Care Outside of Household.--
            (1) In general.--Subparagraph (B) of section 21(b)(2) of 
        the Internal Revenue Code of 1986 is amended by striking ``or'' 
        at the end of clause (i), by redesignating clause (ii) as 
        clause (iii), and by inserting after clause (i) the following 
        new clause:
                            ``(ii) a qualifying individual described in 
                        paragraph (1)(D), or''.
            (2) Conforming amendment.--Clause (iii) of section 
        21(b)(2)(B), as redesignated by paragraph (1), is amended by 
        striking ``paragraph (1)(A)'' and inserting ``subparagraph (A) 
        or (D) of paragraph (1)''.
    (c) Conforming Amendments.--
            (1) The heading of section 21 of the Internal Revenue Code 
        of 1986 is amended by striking ``and dependent care services'' 
        and inserting ``, dependent care, and eldercare services''.
            (2) The item relating to section 21 in the table of 
        sections for subpart A of part IV of subchapter A of chapter 1 
        of such Code is amended striking ``and dependent care 
        services'' and inserting ``, dependent care, and eldercare 
        services''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2005.

                 TITLE II--COBRA CONTINUATION COVERAGE

SEC. 201. EXTENDED COBRA CONTINUATION COVERAGE FOR CERTAIN OLDER 
              WORKERS.

    (a) Amendments to the Employee Retirement Income Security Act of 
1974.--Section 602 of the Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1162) is amended--
            (1) in paragraph (2)(A), by adding at the end the 
        following:
                            ``(vi) Special rule for certain older 
                        workers.--
                                    ``(I) In general.--Notwithstanding 
                                any other provision of this 
                                subparagraph, in the case of a 
                                qualifying event described in section 
                                603(2) relating to a reduction of hours 
                                of an employee described in subclause 
                                (II), the date which is 36 months after 
                                the date of the qualifying event, 
                                except that the period of coverage 
                                under this clause shall end on the date 
                                on which the employee becomes entitled 
                                to benefits under title XVIII of the 
                                Social Security Act based on age.
                                    ``(II) Employee described.--An 
                                employee is described in this subclause 
                                if such employee, on the date of the 
                                qualifying event, is at least the early 
                                retirement age (as defined in section 
                                216(l)(2) of the Social Security Act) 
                                but not yet entitled to benefits under 
                                title XVIII of the Social Security Act 
                                based on age.''; and
            (2) in paragraph (3), by adding at the end the following: 
        ``In the case of an individual described in paragraph 
        (2)(A)(vi), any reference in subparagraph (A) of this paragraph 
        to `102 percent' is deemed a reference to `120 percent' for any 
        month after the 18th month of continuation coverage provided 
        for under such paragraph (2)(A)(vi).''.
    (b) Amendments to the Public Health Service Act.--Section 2202 of 
the Public Health Service Act (42 U.S.C. 300bb-2) is amended--
            (1) in paragraph (2)(A), by inserting after clause (iv) the 
        following:
                            ``(v) Special rule for certain older 
                        workers.--
                                    ``(I) In general.--Notwithstanding 
                                any other provision of this 
                                subparagraph, in the case of a 
                                qualifying event described in section 
                                2203(2) relating to a reduction of 
                                hours of an employee described in 
                                subclause (II), the date which is 36 
                                months after the date of the qualifying 
                                event, except that the period of 
                                coverage under this clause shall end on 
                                the date on which the employee becomes 
                                entitled to benefits under title XVIII 
                                of the Social Security Act based on 
                                age.
                                    ``(II) Employee described.--An 
                                employee is described in this subclause 
                                if such employee, on the date of the 
                                qualifying event, is at least the early 
                                retirement age (as defined in section 
                                216(l)(2) of the Social Security Act) 
                                but not yet entitled to benefits under 
                                title XVIII of the Social Security Act 
                                based on age.''; and
            (2) in paragraph (3), by adding at the end the following: 
        ``In the case of an individual described in paragraph 
        (2)(A)(v), any reference in subparagraph (A) of this paragraph 
        to `102 percent' is deemed a reference to `120 percent' for any 
        month after the 18th month of continuation coverage provided 
        for under such paragraph (2)(A)(v).''.
    (c) Amendments to the Internal Revenue Code of 1986.--Section 
4980B(f) of the Internal Revenue Code of 1986 is amended--
            (1) in paragraph (2)(B)(i), by inserting after subclause 
        (V) the following:
                                    ``(VI) Special rule for certain 
                                older workers.--
                                            ``(aa) In general.--
                                        Notwithstanding any other 
                                        provision of this clause, in 
                                        the case of a qualifying event 
                                        described in paragraph (3)(B) 
                                        relating to a reduction of 
                                        hours of an employee described 
                                        in item (bb), the date which is 
                                        36 months after the date of the 
                                        qualifying event, except that 
                                        the period of coverage under 
                                        this clause shall end on the 
                                        date on which the employee 
                                        becomes entitled to benefits 
                                        under title XVIII of the Social 
                                        Security Act based on age.
                                            ``(bb) Employee 
                                        described.--An employee is 
                                        described in this subclause if 
                                        such employee, on the date of 
                                        the qualifying event, is at 
                                        least the early retirement age 
                                        (as defined in section 
                                        216(l)(2) of the Social 
                                        Security Act) but not yet 
                                        entitled to benefits under 
                                        title XVIII of the Social 
                                        Security Act based on age.''; 
                                        and
            (2) in paragraph (2)(C) by adding at the end the following: 
        ``In the case of an individual described in subparagraph 
        (B)(i)(VI), any reference in clause (i) of this subparagraph to 
        `102 percent' is deemed a reference to `120 percent' for any 
        month after the 18th month of continuation coverage provided 
        for under such subparagraph (B)(i)(VI).''.

                   TITLE III--EMPLOYMENT AND TRAINING

SEC. 301. DEFINITIONS.

    Section 101 of the Workforce Investment Act of 1998 (29 U.S.C. 
2801) is amended--
            (1) by redesignating paragraphs (17) through (53) as 
        paragraphs (18) through (54), respectively; and
            (2) by inserting after paragraph (16) the following:
            ``(17) Hard-to-serve populations.--The term `hard-to-serve 
        populations' means populations of individuals who are hard to 
        serve, including displaced homemakers, low-income individuals, 
        Native Americans, individuals with disabilities, older 
        individuals, ex-offenders, homeless individuals, individuals 
        with limited English proficiency, individuals who do not meet 
        the definition of literacy in section 203, individuals facing 
        substantial cultural barriers, migrant and seasonal 
        farmworkers, individuals within 2 years of exhausting lifetime 
        eligibility under part A of title IV of the Social Security Act 
        (42 U.S.C. 601 et seq.), single parents (including single 
        pregnant women), and such other groups as the Governor 
        determines to be hard to serve.''.

SEC. 302. STATEWIDE EMPLOYMENT AND TRAINING ACTIVITIES.

    Section 134(a)(3)(A) of such Act (29 U.S.C. 2864 (a)(3)(A)) is 
amended--
            (1) in clause (vi), by striking ``and'' at the end;
            (2) by redesignating clause (vii) as clause (viii); and
            (3) by inserting after clause (vi) the following:
                            ``(vii) developing strategies for 
                        effectively serving hard-to-serve populations 
                        and for coordinating programs and services 
                        among one-stop partners; and''.

SEC. 303. LOCAL EMPLOYMENT AND TRAINING ACTIVITIES.

    (a) Intensive Services.--Section 134(d)(3) of such Act (29 U.S.C. 
2864(d)(3)) is amended by striking subparagraph (A) and inserting the 
following:
                    ``(A) In general.--
                            ``(i) Eligibility.--Except as provided in 
                        clause (iii), funds allocated to a local area 
                        for adults under paragraph (2)(A) or (3), as 
                        appropriate, of section 133(b), and funds 
                        allocated to the local area for dislocated 
                        workers under section 133(b)(2)(B), shall be 
                        used to provide intensive services to adults 
                        and dislocated workers, respectively--
                                    ``(I) who are unemployed and who, 
                                after an interview, evaluation, or 
                                assessment, have been determined by a 
                                one-stop operator or one-stop partner 
                                to be--
                                            ``(aa) unlikely or unable 
                                        to obtain employment, that 
                                        leads to self-sufficiency or 
                                        wages comparable to or higher 
                                        than previous employment, 
                                        through core services described 
                                        in paragraph (2); and
                                            ``(bb) in need of intensive 
                                        services to obtain employment 
                                        that leads to self-sufficiency 
                                        or wages comparable to or 
                                        higher than previous 
                                        employment; or
                                    ``(II) who are employed, but who, 
                                after an interview, evaluation, or 
                                assessment, are determined by a one-
                                stop operator or one-stop partner to be 
                                in need of intensive services to obtain 
                                or retain employment that leads to 
                                self-sufficiency.
                            ``(ii) Consideration.--For purposes of 
                        determining whether an adult or dislocated 
                        worker meets the requirements of clause 
                        (i)(I)(aa), a one-stop operator or one-stop 
                        partner shall consider whether the adult or 
                        dislocated worker is a member of a hard-to-
                        serve population.
                            ``(iii) Special rule.--A new interview, 
                        evaluation, or assessment of a participant is 
                        not required under clause (i) if the one-stop 
                        operator or one-stop partner determines that it 
                        is appropriate to use a recent assessment of 
                        the participant conducted pursuant to another 
                        education or training program.''.
    (b) Training Services.--Section 134(d)(4) of such Act (29 U.S.C. 
2864(d)(4)) is amended by striking subparagraph (A) and inserting the 
following:
                    ``(A) In general.--
                            ``(i) Eligibility.--Except as provided in 
                        clause (iii), funds allocated to a local area 
                        for adults under paragraph (2)(A) or (3), as 
                        appropriate, of section 133(b), and funds 
                        allocated to the local area for dislocated 
                        workers under section 133(b)(2)(B), shall be 
                        used to provide training services to adults and 
                        dislocated workers, respectively--
                                    ``(I) who, after an interview, 
                                evaluation, or assessment, and case 
                                management, have been determined by a 
                                one-stop operator or one-stop partner, 
                                as appropriate, to--
                                            ``(aa) be unlikely or 
                                        unable to obtain or retain 
                                        employment, that leads to self-
                                        sufficiency or wages comparable 
                                        to or higher than previous 
                                        employment, through the 
                                        intensive services described in 
                                        paragraph (3);
                                            ``(bb) be in need of 
                                        training services to obtain or 
                                        retain employment that leads to 
                                        self-sufficiency or wages 
                                        comparable to or higher than 
                                        previous employment; and
                                            ``(cc) have the skills and 
                                        qualifications to successfully 
                                        participate in the selected 
                                        program of training services;
                                    ``(II) who select programs of 
                                training services that are directly 
                                linked to the employment opportunities 
                                in the local area or region involved or 
                                in another area to which the adults or 
                                dislocated workers are willing to 
                                commute or relocate;
                                    ``(III) who meet the requirements 
                                of subparagraph (B); and
                                    ``(IV) who are determined to be 
                                eligible in accordance with the 
                                priority system in effect under 
                                subparagraph (E).
                            ``(ii) Consideration.--For purposes of 
                        determining whether an adult or dislocated 
                        worker meets the requirements of clause 
                        (i)(I)(aa), a one-stop operator or one-stop 
                        partner shall consider whether the adult or 
                        dislocated worker is a member of a hard-to-
                        serve population.
                            ``(iii) Special rule.--A new interview, 
                        evaluation, or assessment of a participant is 
                        not required under clause (i) if the one-stop 
                        operator or one-stop partner determines that it 
                        is appropriate to use a recent assessment of 
                        the participant conducted pursuant to another 
                        education or training program.''.
    (c) Local Employment and Training Activities.--Section 134(e)(1)(A) 
of such Act (29 U.S.C. 2864(e)(1)(A)) is amended--
            (1) in subparagraph (A), by striking ``and'' at the end;
            (2) in subparagraph (B), by striking the period and 
        inserting ``; and''; and
            (3) by adding at the end the following:
                    ``(C) customer support to enable members of hard-
                to-serve populations, including individuals with 
                disabilities, to navigate among multiple services and 
                activities for such populations.''.

SEC. 304. PERFORMANCE MEASURES.

    (a) State Performance Measures.--Section 136(b)(3)(A)(iv)(II) of 
the Workforce Investment Act of 1998 (29 U.S.C. 2871(b)(3)(A)(iv)(II)) 
is amended--
            (1) by striking ``taking into account'' and inserting ``and 
        shall ensure that the levels involved are adjusted, using 
        objective statistical methods, based on'';
            (2) by inserting ``(such as differences in unemployment 
        rates and job losses or gains in particular industries)'' after 
        ``economic conditions''; and
            (3) by inserting ``(such as indicators of poor work 
        history, lack of work experience, lack of educational or 
        occupational skills attainment, dislocation from high-wage and 
        benefit employment, low levels of literacy or English 
        proficiency, disability status, older individual status, 
        homelessness, ex-offender status, and welfare dependency)'' 
        after ``program''.
    (b) Local Performance Measures.--Section 136(c)(3) (29 U.S.C. 
2871(c)(3))--
            (1) by striking ``shall take into account'' and inserting 
        ``shall ensure that the levels involved are adjusted, using 
        objective statistical methods, based on'';
            (2) by inserting ``(characteristics such as unemployment 
        rates and job losses or gains in particular industries)'' after 
        ``economic''; and
            (3) by inserting ``(characteristics such as indicators of 
        poor work history, lack of work experience, lack of educational 
        and occupational skills attainment, dislocation from high-wage 
        and benefit employment, low levels of literacy or English 
        proficiency, disability status, older individual status, 
        homelessness, ex-offender status, and welfare dependency)'' 
        after ``demographic''.
    (c) Wage Records and Documented Data.--Section 136(f)(2) of such 
Act (29 U.S.C. 2871(f)(2)) is amended--
            (1) by striking ``(2)'' and all that follows through ``In'' 
        and inserting the following:
            ``(2) Wage records and documented data.--
                    ``(A) Wage records.--In''; and
            (2) by adding at the end the following:
                    ``(B) Documented data.--In measuring the progress 
                of the State with respect to older individuals on State 
                and local performance measures relating to earnings, a 
                State may use documented data other than quarterly wage 
                records to determine the work schedule of the older 
                individuals, and may impute full-time earnings to part-
                time workers who are older individuals.''.

SEC. 305. REPORTING.

    Section 136(d)(2) of such Act (29 U.S.C. 2871(d)(2)) is amended--
            (1) in subparagraph (E), by striking ``(excluding 
        participants who received only self-service and informational 
        activities)''; and
            (2) in subparagraph (F)--
                    (A) by striking ``(F)'' and inserting ``(F)(i)'';
                    (B) by striking the period and inserting ``; and''; 
                and
                    (C) by adding at the end the following:
                            ``(ii) the number of participants in each 
                        of the groups described in clause (i) who have 
                        received services authorized under this title, 
                        in the form of core services described in 
                        section 134(d)(2), intensive services described 
                        in section 134(d)(3), training services 
                        described in section 134(d)(4), and followup 
                        services, respectively;''.

SEC. 306. INCENTIVE GRANTS.

    (a) Use of Funds for Statewide Employment and Training 
Activities.--Section 134(a)(2)(B) of the Workforce Investment Act of 
1998 (29 U.S.C. 2864(a)(2)(B)) is amended--
            (1) in clause (v), by striking ``and'' at the end;
            (2) in clause (vi), by striking the period and inserting 
        ``; and''; and
            (3) by adding at the end the following:
                            ``(vii) providing incentive grants to local 
                        areas, in accordance with section 136(j).''.
    (b) Incentive Grants for Local Areas.--Section 136 of such Act is 
amended by adding at the end the following:
    ``(j) Incentive Grants for Local Areas.--
            ``(1) In general.--From funds reserved under sections 
        128(a) and 133(a)(1), the Governor involved shall award 
        incentive grants to local areas for performance described in 
        paragraph (2) in carrying out programs under chapters 4 and 5.
            ``(2) Basis.--The Governor shall award the grants on the 
        basis that the local areas--
                    ``(A) have exceeded the performance measures 
                established under subsection (c)(2) relating to 
                indicators described in subsection (b)(3)(A)(iii); or
                    ``(B) have--
                            ``(i) met the performance measures 
                        established under subsection (c)(2) relating to 
                        indicators described in subsection 
                        (b)(3)(A)(iii); and
                            ``(ii) demonstrated exemplary performance 
                        in the State in serving hard-to-serve 
                        populations.
            ``(3) Use of funds.--The funds awarded to a local area 
        under this subsection may be used to carry out activities 
        authorized for local areas and such innovative projects or 
        programs that increase coordination and enhance service to 
        program participants, particularly hard-to-serve populations, 
        as may be approved by the Governor.''.
    (c) Incentive Grants for States.--Section 503 of the Workforce 
Investment Act of 1998 (20 U.S.C. 9273) is amended--
            (1) by striking subsection (a) and inserting the following:
    ``(a) In General.--
            ``(1) Timeline.--
                    ``(A) Prior to july 1, 2006.--Prior to July 1, 
                2006, the Secretary shall award a grant to each State 
                in accordance with the provisions of this section as 
                this section was in effect on July 1, 2003.
                    ``(B) Beginning july 1, 2006.--Beginning on July 1, 
                2006, the Secretary shall award incentive grants to 
                States for performance described in paragraph (2) in 
                carrying out innovative programs consistent with the 
                programs under chapters 4 and 5 of subtitle B of title 
                I, to implement or enhance innovative and coordinated 
                programs consistent with the statewide economic, 
                workforce, and educational interests of the State.
            ``(2) Basis.--The Secretary shall award the grants on the 
        basis that States--
                    ``(A) have exceeded the State adjusted levels of 
                performance for title I, the adjusted levels of 
                performance for title II, and the levels of performance 
                under the Carl D. Perkins Vocational and Technical 
                Education Act of 1998 (20 U.S.C. 2301 et seq.); or
                    ``(B) have--
                            ``(i) met the State adjusted levels of 
                        performance for title I, the adjusted levels of 
                        performance for title II, and the levels of 
                        performance under the Carl D. Perkins 
                        Vocational and Technical Education Act of 1998 
                        (20 U.S.C. 2301 et seq.); and
                            ``(ii) demonstrated exemplary performance 
                        in serving hard-to-serve populations.
            ``(3) Use of funds.--The funds awarded to a State under 
        this section may be used to carry out activities authorized for 
        States under chapters 4 and 5 of subtitle B of title I, title 
        II, and the Carl D. Perkins Vocational and Technical Education 
        Act of 1998 (20 U.S.C. 2301 et seq.), including demonstration 
        projects, and for such innovative projects or programs that 
        increase coordination and enhance service to program 
        participants, particularly hard-to-serve populations.''; and
            (2) in subsection (b)(2), by striking subparagraph (C) and 
        inserting the following:
                    ``(C) the State meets the requirements of 
                subparagraph (A) or (B) of subsection (a)(2).''.

             TITLE IV--FEDERAL TASK FORCE ON OLDER WORKERS

SEC. 401. FEDERAL TASK FORCE ON OLDER WORKERS.

    (a) Establishment.--Not later than 90 days after the date of 
enactment of this Act, the Secretary of Labor shall establish a Federal 
Task Force on Older Workers (referred to in this Act as the ``Task 
Force'').
    (b) Membership.--The Task Force established pursuant to subsection 
(a) shall be composed of representatives from all relevant Federal 
agencies that have regulatory jurisdiction over, or a clear policy 
interest in, issues relating to older workers, including the Internal 
Revenue Service, the Social Security Administration, the Equal 
Employment Opportunity Commission, and the Administration on Aging of 
the Department of Health and Human Services.
    (c) Activities.--
            (1) After one year.--Not later than 1 year after the date 
        of establishment of the Task Force, the Task Force shall--
                    (A) identify statutory and regulatory provisions in 
                current law that tend to limit opportunities for older 
                workers, and develop legislative and regulatory 
                proposals to address such limitations;
                    (B) identify best practices in the private sector 
                for hiring and retaining older workers, and serve as a 
                clearinghouse of such information; and
                    (C) assess the effectiveness and cost of programs 
                that Federal agencies have implemented to hire and 
                retain older workers (including the Senior 
                Environmental Employment (SEE) Program of the 
                Environmental Protection Agency), and recommend cost-
                effective programs for all Federal agencies to hire and 
                retain older workers.
            (2) After three years.--Not later than 3 years after the 
        date of establishment of the Task Force, the Task Force shall--
                    (A) assess the effectiveness of the provisions of 
                this Act; and
                    (B) organize a Conference on the Aging Workforce, 
                which shall include the participation of senior, 
                business, labor, and other interested organizations.
            (3) Report.--The Task Force shall submit a report to 
        Congress on the activities of the Task Force pursuant to 
        paragraph (1). Such report shall be made available to the 
        public.
    (d) Consultation.--In carrying out activities pursuant to this 
section, the Task Force shall consult with senior, business, labor, and 
other interested organizations.
    (e) Applicability of FACA; Termination of Task Force.--
            (1) FACA.--The Federal Advisory Committee Act (5 U.S.C. 
        App.) shall not apply to the Task Force established pursuant to 
        this Act.
            (2) Termination.--The Task Force shall terminate 30 days 
        after the date the Task Force completes all of its duties under 
        this Act.
                                 <all>
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