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[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5727 Introduced in House (IH)]

112th CONGRESS
  2d Session
                                H. R. 5727

To rebuild the American middle class by creating jobs, investing in our 
   future, building opportunity for working families, and restoring 
                        balance to the tax code.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                              May 10, 2012

    Ms. DeLauro (for herself and Mr. Braley of Iowa) introduced the 
following bill; which was referred to the Committee on Ways and Means, 
   and in addition to the Committees on Education and the Workforce, 
 Energy and Commerce, Agriculture, Transportation and Infrastructure, 
Financial Services, Science, Space, and Technology, Small Business, the 
     Judiciary, Rules, Oversight and Government Reform, and House 
   Administration, for a period to be subsequently determined by the 
  Speaker, in each case for consideration of such provisions as fall 
           within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL

 
To rebuild the American middle class by creating jobs, investing in our 
   future, building opportunity for working families, and restoring 
                        balance to the tax code.

    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 ``Rebuild America 
Act''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
     TITLE I--INVESTING IN AMERICA TO CREATE JOBS AND FUTURE GROWTH

 Subtitle A--Investing in America's Roads, Bridges, and Infrastructure

Sec. 101. Modernization, renovation, and repair of educational 
                            facilities.
Sec. 102. National energy renovation and retrofit program.
Sec. 103. Rebuilding America's infrastructure.
          Subtitle B--Rebuilding America's Manufacturing Power

Sec. 111. National manufacturing strategy.
Sec. 112. Sectoral technology and innovation centers.
Sec. 113. Capital for small manufacturers with firm orders.
Sec. 114. Manufacturing Extension Partnership.
Sec. 115. Extension of research credit; increase in alternative 
                            simplified research credit.
Sec. 116. Inclusion of certain provisions in trade agreements.
Sec. 117. Funding for Interagency Trade Enforcement Center.
Sec. 118. Imposition of countervailing duties for subsidies relating to 
                            fundamentally undervalued currencies.
       Subtitle C--Preparing Americans for the Jobs of the Future

Sec. 121. Short title.
Sec. 122. Definitions.
Sec. 123. Program.
Sec. 124. Eligible entities.
Sec. 125. Applications.
Sec. 126. Priority and distribution.
Sec. 127. Use of funds.
Sec. 128. Matching requirement.
Sec. 129. Funding.
                 Subtitle D--Supporting Great Teachers

Sec. 131. Short title.
Sec. 132. Findings.
Sec. 133. Purposes.
Sec. 134. Definitions.
Sec. 135. Grants authorized.
Sec. 136. Application.
Sec. 137. State use of grant funds.
Sec. 138. Subgrants to local entities.
Sec. 139. Reporting.
Sec. 140. Teacher privacy.
Sec. 141. Rule of construction.
Sec. 142. Funding.
                 Subtitle E--Creating Middle Class Jobs

                     PART I--Teacher Stabilization

Sec. 151. Purpose.
Sec. 152. Definitions.
Sec. 153. Reservations for the outlying areas and the Secretary of the 
                            Interior.
Sec. 154. State allotments.
Sec. 155. State application, reservation, and responsibilities.
Sec. 156. Subgrants.
Sec. 157. Maintenance of effort.
Sec. 158. Reporting.
Sec. 159. Funding.
                 PART II--First Responder Stabilization

Sec. 161. Purpose.
Sec. 162. Career law enforcement officers grant program.
Sec. 163. First responder grant program.
           PART III--Maintaining Critical Community Services

Sec. 171. Definitions.
Sec. 172. Maintaining critical community services.
Sec. 173. Application.
Sec. 174. Award basis.
Sec. 175. Uses of funds.
Sec. 176. Employee status, compliance with local laws, and contracts.
Sec. 177. Supplement, not supplant.
Sec. 178. Funding provided.
 TITLE II--CREATING FINANCIAL STABILITY AND A BETTER FUTURE FOR MIDDLE 
                             CLASS FAMILIES

          Subtitle A--Alleviating the High Cost of Child Care

Sec. 201. CCDBG Plus.
         Subtitle B--Helping Americans Enjoy Their Golden Years

               PART I--Commission on Retirement Security

Sec. 211. Short title.
Sec. 212. Findings.
Sec. 213. Commission on Retirement Security.
Sec. 214. Duties.
Sec. 215. Commission personnel matters.
Sec. 216. Termination of Commission.
                        PART II--Social Security

Sec. 221. Determination of taxable wages and self-employment income 
                            above contribution and benefit base after 
                            2012.
Sec. 222. Adjustments to bend points in determining primary insurance 
                            amount.
Sec. 223. Consumer Price Index for Elderly Consumers.
Sec. 224. Computation of cost-of-living increases for Social Security 
                            benefits.
Sec. 225. Non-application of increase in Social Security benefits for 
                            other Federal or federally assisted 
                            programs.
       Subtitle C--Protecting Overtime Pay for Working Americans

Sec. 231. Salary thresholds, highly compensated employees, and primary 
                            duties.
 Subtitle D--Preventing Americans From Having To Choose Between Their 
                       Health and Their Paycheck

Sec. 241. Short title.
Sec. 242. Findings.
Sec. 243. Purposes.
Sec. 244. Definitions.
Sec. 245. Provision of paid sick time.
Sec. 246. Posting requirement.
Sec. 247. Prohibited acts.
Sec. 248. Enforcement authority.
Sec. 249. Collection of data on paid sick time and further study.
Sec. 250. Effect on other laws.
Sec. 251. Effect on existing employment benefits.
Sec. 252. Encouragement of more generous leave policies.
Sec. 253. Regulations.
Sec. 254. Effective dates.
              Subtitle E--Establishing a Fair Minimum Wage

Sec. 261. Minimum wage increases.
              Subtitle F--Empowering Hardworking Americans

Sec. 271. Amendments to the National Labor Relations Act.
      Subtitle G--Increasing Job Opportunities for Americans With 
                              Disabilities

Sec. 281. Modification of work opportunity credit.
       TITLE III--RESTORING BALANCE AND FAIRNESS TO THE TAX CODE

Sec. 300. Amendment of 1986 Code.
              Subtitle A--Instituting the ``Buffett Rule''

Sec. 301. Fair share tax on high-income taxpayers.
     Subtitle B--Adopting a Wall Street Trading and Speculators Tax

Sec. 311. Transaction tax.
  Subtitle C--Ending Tax Breaks for Companies That Ship Jobs Overseas

Sec. 321. Allocation of expenses and taxes on basis of repatriation of 
                            foreign income.
Sec. 322. Excess income from transfers of intangibles to low-taxed 
                            affiliates treated as subpart F income.
Sec. 323. Modifications of foreign tax credit rules applicable to dual 
                            capacity taxpayers.
           Subtitle D--Making Wall Street Take Responsibility

Sec. 331. Financial Crisis Responsibility Fee.
           Subtitle E--Closing the Carried Interest Loophole

Sec. 341. Partnership interests transferred in connection with 
                            performance of services.
Sec. 342. Special rules for partners providing investment management 
                            services to partnerships.
               Subtitle F--Raising the Capital Gains Rate

Sec. 351. Increased capital gains rate for high-income individuals.
                Subtitle G--Pension Guaranty Improvement

Sec. 361. Short title.
Sec. 362. Findings.
Sec. 363. Pension Benefit Guaranty Corporation Governance Improvement.
Sec. 364. Participant and plan sponsor advocate.
Sec. 365. Increase in multiemployer plan benefit guarantee and annual 
                            premium rates.
Sec. 366. Improving single employer program solvency.
             Subtitle H--Pension and Participant Protection

Sec. 371. Short title.
Sec. 372. Findings.
Sec. 373. Pension funding stabilization.
Sec. 374. Congressional commitment to encouraging pensions.
Sec. 375. Participant protection in bankruptcy.
                     Subtitle I--Fair Playing Field

Sec. 381. Short title; findings; purposes.
Sec. 382. Authority to issue guidance clarifying employment status for 
                            purposes of employment taxes.
                  TITLE IV--REBUILD AMERICA TRUST FUND

Sec. 401. Establish Rebuild America Trust Fund.

     TITLE I--INVESTING IN AMERICA TO CREATE JOBS AND FUTURE GROWTH

 Subtitle A--Investing in America's Roads, Bridges, and Infrastructure

SEC. 101. MODERNIZATION, RENOVATION, AND REPAIR OF EDUCATIONAL 
              FACILITIES.

    (a) Purpose.--The purpose of this section is to provide assistance 
for the modernization, renovation, and repair of eligible educational 
facilities, including early learning facilities, public elementary 
school and secondary school facilities, and community college 
facilities.
    (b) Definitions.--In this section:
            (1) ESEA definitions.--The terms ``elementary school'', 
        ``local educational agency'', ``outlying area'', ``secondary 
        school'', ``Secretary'', and ``State'' have the meanings given 
        the terms in section 9101 of the Elementary and Secondary 
        Education Act of 1965 (20 U.S.C. 7801).
            (2) CHPS criteria.--The term ``CHPS Criteria'' means the 
        green building rating criteria developed by the Collaborative 
        for High Performance Schools.
            (3) Community college.--The term ``community college'' 
        means--
                    (A) a junior or community college, as defined in 
                section 312(f) of the Higher Education Act of 1965 (20 
                U.S.C. 1058(f)); or
                    (B) a 4-year public institution of higher 
                education, as defined under section 101 of the Higher 
                Education Act of 1965 (20 U.S.C. 1001), that awards a 
                significant number of degrees and certificates, as 
                determined by the Secretary, that are not--
                            (i) baccalaureate degrees, or the 
                        equivalent of such degrees; or
                            (ii) masters, professional, or other 
                        advanced degrees.
            (4) Eligible entity.--The term ``eligible entity'' means 
        the following:
                    (A) In reference to the modernization, renovation, 
                or repair of an early learning facility, the term 
                ``eligible entity'' means--
                            (i) an eligible child care provider as 
                        defined in paragraph (5)(A) of section 658P of 
                        the Child Care and Development Block Grant Act 
                        of 1990 (42 U.S.C. 9858n(5)(A)); or
                            (ii) a Head Start center under the Head 
                        Start Act (42 U.S.C. 9831 et seq.).
                    (B) In reference to the modernization, renovation, 
                or repair of a public elementary school or secondary 
                school facility, the term ``eligible entity'' means a 
                local educational agency.
                    (C) In reference to the modernization, renovation, 
                or repair of a community college facility, the term 
                ``eligible entity'' means the community college.
            (5) Energy star.--The term ``Energy Star'' means the Energy 
        Star program of the Department of Energy and the Environmental 
        Protection Agency.
            (6) Green globes.--The term ``Green Globes'' means the 
        Green Building Initiative environmental design and rating 
        system.
            (7) LEED green building rating system.--The term ``LEED 
        Green Building Rating System'' means the United States Green 
        Building Council Leadership in Energy and Environmental Design 
        green building rating system.
    (c) Grants to States.--
            (1) In general.--The Secretary shall allocate funds to each 
        State, as described in paragraph (3), to enable the State to 
        award subgrants, on a competitive basis, to eligible entities 
        for the purpose of modernizing, renovating, and repairing 
        eligible educational facilities. Grant funds may be used for 
        direct payments, payment of interest on bonds, or payments for 
        other financing instruments that are newly issued for the 
        purpose of financing school modernization, renovation, or 
        repair.
            (2) Reservations.--From the funds made available under 
        subsection (i) for a fiscal year, the Secretary shall reserve 
        for the purposes of this section--
                    (A) 0.5 percent for payments to the Secretary of 
                the Interior to provide assistance to schools funded by 
                the Bureau of Indian Education;
                    (B) 0.75 percent to provide assistance to the 
                outlying areas; and
                    (C) 0.25 percent for grants to institutions that 
                are eligible to receive a grant under section 316 of 
                the Higher Education Act of 1965 (20 U.S.C. 1059c).
            (3) Amount of funds.--From the funds made available under 
        subsection (i) for any fiscal year and remaining after the 
        Secretary makes reservations under paragraph (2) for the fiscal 
        year, the Secretary shall allot to each State the sum of--
                    (A) an amount that bears the same relationship to 
                35 percent of the remaining amount as the number of 
                individuals who have not yet attained age 25 in the 
                State, as determined by the Secretary on the basis of 
                the most recent satisfactory data, bears to the number 
                of those individuals in all such States, as so 
                determined; and
                    (B) an amount that bears the same relationship to 
                65 percent of the remaining amount as the number of 
                individuals who have not yet attained age 25 who are 
                from families with incomes below the poverty line, in 
                the State, as determined by the Secretary on the basis 
                of the most recent satisfactory data, bears to the 
                number of those individuals in all such States, as so 
                determined.
            (4) Reallocation.--If a State does not apply for its 
        allocation under this section, applies for less than the full 
        allocation for which it is eligible, or does not use the 
        allocation in a timely manner, the Secretary may reallocate all 
        or a portion of the allocation to the other States.
    (d) Subgrants.--
            (1) In general.--From the funds allocated to a State under 
        subsection (c) for any fiscal year and remaining after the 
        State makes any reservations under paragraph (2) for the fiscal 
        year, each State receiving a grant under this section shall 
        distribute--
                    (A) 10 percent to award subgrants to eligible 
                entities for the modernization, renovation, and repair 
                of early learning facilities;
                    (B) 65 percent to award subgrants to eligible 
                entities for the modernization, renovation, and repair 
                of public elementary school and secondary school 
                facilities; and
                    (C) 25 percent to award subgrants to eligible 
                entities for the modernization, renovation, and repair 
                of community college facilities.
            (2) State administration and other costs.--Each State that 
        receives a grant under this section may reserve not more than 1 
        percent of the grant allocation under subsection (c) for the 
        purposes of administering the distribution of subgrants under 
        this section, including the provision of technical assistance 
        to eligible entities.
            (3) Matching requirement.--
                    (A) In general.--A State shall require eligible 
                entities to match funds awarded under this subsection.
                    (B) Amount of matching funds requirement.--The 
                amount of a match described in subparagraph (A) may be 
                established by using a sliding scale that takes into 
                account the relative poverty of the population served 
                by the eligible entity.
    (e) State Applications.--A State that desires to receive a grant 
under this section shall submit an application to the Secretary at such 
time, in such manner, and containing such information and assurances as 
the Secretary may require. Such application shall include the 
following:
            (1) An identification of the State agency or entity that 
        will administer the grant program.
            (2) A description of the State's process for determining 
        how subgrant funds will be distributed and administered, 
        including--
                    (A) how the State will determine the criteria for 
                awarding subgrants under subsection (d); and
                    (B) how the State will consider--
                            (i) the needs of each eligible entity, or 
                        each population served by an eligible entity, 
                        for assistance under this section;
                            (ii) the impact of potential projects on 
                        job creation in the State;
                            (iii) the fiscal capacity of the eligible 
                        entity applying for assistance; and
                            (iv) the percentage of individuals served 
                        by the eligible entity who are from low-income 
                        families.
            (3) If the State plans to award subgrants to early learning 
        facilities, a description of how the State will--
                    (A) coordinate, to the extent feasible, with State 
                early childhood advisory councils established under 
                section 642B(b)(1)(A) of the Head Start Act (42 U.S.C. 
                9837b(b)(1)(A)); and
                    (B) encourage eligible entities to coordinate with 
                organizations that have demonstrated experience in 
                providing technical or financial assistance for the 
                modernization, renovation, or repair of child care 
                facilities.
            (4) A description of how the State will ensure that 
        eligible entities receiving subgrants under this section meet 
        the requirements of this section.
            (5) A description of how the State will give priority to 
        eligible entities that serve the highest percentage of low-
        income individuals.
            (6) A description of how the State will give priority to 
        eligible entities that use green practices that are certified, 
        verified, or consistent with any applicable provisions of--
                    (A) the LEED Green Building Rating System;
                    (B) Energy Star;
                    (C) the CHPS Criteria;
                    (D) Green Globes; or
                    (E) an equivalent program adopted by the State or 
                another jurisdiction with authority over the eligible 
                entity.
            (7) A description of the steps that the State will take to 
        ensure that eligible entities receiving subgrants will 
        adequately maintain any facilities that are modernized, 
        renovated, or repaired with subgrant funds awarded under 
        subsection (d).
    (f) Use of Funds.--With respect to funds made available under this 
section that are used for the modernization, renovation, and repair of 
eligible educational facilities the following rules shall apply:
            (1) Permissible uses of funds.--Facility modernization, 
        renovation, and repair shall be limited to 1 or more of the 
        following:
                    (A) Upgrades, repair, or replacement of building 
                systems or components to improve the quality of 
                education and ensure the health and safety of students 
                and staff.
                    (B) Modifications necessary to render eligible 
                educational facilities accessible in order to comply 
                with the Americans with Disabilities Act of 1990 (42 
                U.S.C. 12101 et seq.) and section 504 of the 
                Rehabilitation Act of 1973 (29 U.S.C. 794).
                    (C) Improvements to environmental conditions, 
                including asbestos abatement or removal, and the 
                reduction or elimination of human exposure to lead-
                based paint, mold, or mildew.
                    (D) Measures designed to reduce or eliminate human 
                exposure to classroom noise and environmental noise 
                pollution.
                    (E) Modifications necessary to reduce the 
                consumption of electricity, natural gas, oil, water, 
                coal, or land.
                    (F) Upgrades or installations of educational 
                technology infrastructure or training equipment.
            (2) Impermissible uses of funds.--Funds received under this 
        section shall not be used for--
                    (A) payment of maintenance costs;
                    (B) purchase or upgrade of vehicles;
                    (C) improvement or construction of stand-alone 
                facilities whose purpose is not the education or care 
                of children or other students, including central office 
                administration or operations or logistical support 
                facilities;
                    (D) athletic facilities;
                    (E) purchase of carbon offsets; or
                    (F) the facilities of a sectarian institution, or 
                facilities that are used primarily for sectarian 
                purposes.
            (3) Supplement, not supplant.--A local educational agency 
        or State-operated or State-supported eligible entity shall use 
        Federal funds subject to this subsection only to supplement the 
        amount of funds that would, in the absence of such Federal 
        funds, be made available from non-Federal sources for school 
        modernization, renovation, and repair.
    (g) General Provision.--Each eligible entity that receives subgrant 
funds under subsection (d) shall ensure that, if such eligible entity 
carries out modernization, renovation, and repair through a contract, 
any such contract process ensures the maximum number of qualified 
bidders, including small, minority, and women-owned businesses, through 
full and open competition.
    (h) Report.--The Secretary shall submit to the appropriations 
committees and the authorizing committees (as defined in section 103 of 
the Higher Education Act of 1965 (20 U.S.C. 1003)) of the House of 
Representatives and the Senate an annual report regarding the grants 
made under this section.
    (i) Funding.--There shall be made available from the Rebuild 
America Trust Fund under section 9512 of the Internal Revenue Code of 
1986, $2,000,000,000 for each of fiscal years 2013 through 2022 to 
carry out this section.

SEC. 102. NATIONAL ENERGY RENOVATION AND RETROFIT PROGRAM.

    Part D of title III of the Energy Policy and Conservation Act is 
amended by inserting after section 364 (42 U.S.C. 6324) the following:

``SEC. 364A. NATIONAL ENERGY RENOVATION AND RETROFIT PROGRAM.

    ``(a) In General.--The Secretary shall provide grants to eligible 
entities to pay the Federal share of the cost of carrying out 
comprehensive energy systems renovation, including--
            ``(1) energy systems planning and assessment; and
            ``(2) implementation of energy efficiency and renewable 
        energy projects.
    ``(b) Eligible Entities.--An entity shall be eligible to obtain a 
grant under this section if the entity is a residential, commercial, 
industrial, manufacturing, institutional, educational, nonprofit, or 
other type of entity, organization, or consortia that is approved by 
the Secretary.
    ``(c) Use.--A grant provided under this section may be used by an 
eligible entity--
            ``(1) to conduct entity energy assessments that cover total 
        energy use across all members and activities of the entity;
            ``(2) to analyze and summarize the major sources and 
        impacts of the energy use described in paragraph (1);
            ``(3) to identify alternative approaches to modifying 
        energy systems to reduce energy use, reduce the environmental 
        and climatic impact of the energy use, and increase the use of 
        clean, domestic energy;
            ``(4) to formulate an entity strategy for changing the 
        overall energy usage of the entity;
            ``(5) to implement the strategy described in paragraph (4) 
        through the purchase and installation of energy efficiency and 
        renewable energy systems and other actions, as determined by 
        the entity; and
            ``(6) to track and evaluate the effects of the entity 
        energy renovation and retrofit efforts.
    ``(d) Administration.--The Secretary, in collaboration with State 
energy offices, shall establish procedures for soliciting and 
evaluating proposals from entities, overseeing grants to eligible 
entities, and otherwise administering this section, including 
procedures for--
            ``(1) annual solicitation and grant cycles;
            ``(2) education and technical assistance programs; and
            ``(3) reporting and information-sharing activities.
    ``(e) Allocation of Funds.--The Secretary shall--
            ``(1) determine the amount of funds that are allocated for 
        grants for States and political subdivisions of States for a 
        fiscal year under this section;
            ``(2) provide a Federal share of not more than 50 percent 
        of the cost of carrying out energy renovation programs under 
        this section; and
            ``(3) permit an eligible entity to provide the non-Federal 
        share of the cost of carrying out energy renovation and 
        retrofit programs under this section in the form of in-kind 
        services.
    ``(f) Funding.--There shall be made available from the Rebuild 
America Trust Fund under section 9512 of the Internal Revenue Code of 
1986, $1,500,000,000 for each of fiscal years 2013 through 2022 to 
carry out this section.''.

SEC. 103. REBUILDING AMERICA'S INFRASTRUCTURE.

    (a) In General.--For fiscal years 2013 through 2022 and subject to 
the limitations provided in subsection (b), the following amounts shall 
be provided from the Rebuild America Trust Fund (referred to in this 
section as the ``trust fund''):
            (1) Rural community facilities program account of the 
        department of agriculture.--For additional amounts for the cost 
        of direct loans and grants for rural community facilities 
        programs as provided for under section 306 and described in 
        section 381E(d)(1) of the Consolidated Farm and Rural 
        Development Act, $400,000,000 in each of fiscal years 2013 and 
        2014 and $200,000,000 in each of fiscal years 2015 through 
        fiscal year 2021.
            (2) Rural water and waste disposal program account of the 
        rural utilities service.--For an additional amount for the cost 
        of direct loans and grants for the rural water, waste water, 
        and waste disposal programs as provide for under sections 306 
        and 310B and described in section 381E(d)(2) of the 
        Consolidated Farm and Rural Development Act, $1,200,000,000 in 
        each of fiscal years 2013 and 2014 and $600,000,000 in each of 
        fiscal years 2015 through fiscal year 2021. For the calculation 
        of ability to pay for the determination of the grant loan ratio 
        under this paragraph, only the community receiving the benefit 
        for a project shall be considered.
            (3) Economic development administration of the department 
        of commerce.--For an additional amount for ``Economic 
        Development Assistance Programs'', $500,000,000 in each of 
        fiscal years 2013 and 2014 and $250,000,000 in each of fiscal 
        years 2015 through fiscal year 2021. Of the sum provided by the 
        preceding sentence, 10 percent of those funds provided may be 
        transferred to federally authorized regional economic 
        development commissions.
            (4) Corps of engineers civil of the department of the army 
        of the department of defense.--
                    (A) Investigations.--For an additional amount for 
                ``Investigations'', $200,000,000 in each of fiscal 
                years 2013 and 2014 and $100,000,000 in each of fiscal 
                years 2015 through fiscal year 2021.
                    (B) Construction.--For additional amounts for 
                construction, $1,800,000,000 in each of fiscal years 
                2013 and 2014 and $900,000,000 in each of fiscal years 
                2015 through fiscal year 2021.
                    (C) Sharing.--Notwithstanding any other provision 
                of law, funds provided in this paragraph shall not be 
                cost shared with the Inland Waterways Trust Fund as 
                authorized in Public Law 99-662.
            (5) Energy efficiency and renewable energy program of the 
        department of energy.--
                    (A) Efficiency.--$2,000,000,000 shall be available 
                for Energy Efficiency and Conservation Block Grants for 
                implementation of programs authorized under subtitle E 
                of title V of the Energy Independence and Security Act 
                of 2007 (42 U.S.C. 17151 et seq.) in each of fiscal 
                years 2013 and 2014 and $1,000,000,000 in each of 
                fiscal years 2015 through fiscal year 2021. Provided 
                further, that 40 percent of these funds shall be 
                awarded on a competitive basis.
                    (B) Weatherization.--
                            (i) In general.--$2,000,000,000 shall be 
                        available for the Weatherization Assistance 
                        Program under part A of title IV of the Energy 
                        Conservation and Production Act (42 U.S.C. 6861 
                        et seq.) in each of fiscal years 2013 and 2014 
                        and $1,000,000,000 in each of fiscal years 2015 
                        through fiscal year 2021.
                            (ii) Weatherization assistance program 
                        amendments.--
                                    (I) Income level.--Section 412(7) 
                                of the Energy Conservation and 
                                Production Act (42 U.S.C. 6862(7)) is 
                                amended by striking ``150 percent'' 
                                both places it appears and inserting 
                                ``200 percent''.
                                    (II) Assistance level per dwelling 
                                unit.--Section 415(c)(1) of the Energy 
                                Conservation and Production Act (42 
                                U.S.C. 6865(c)(1)) is amended by 
                                striking ``$2,500'' and inserting 
                                ``$7,000''.
                    (C) States.--$2,000,000,000 shall be for the State 
                Energy Program authorized under part D of title III of 
                the Energy Policy and Conservation Act (42 U.S.C. 6321) 
                in each of fiscal years 2013 and 2014 and 
                $1,000,000,000 in each of fiscal years 2015 through 
                fiscal year 2022.
            (6) Mitigation for the federal emergency management agency 
        of the department of homeland security.--$1,500,000,000 shall 
        be available for the Hazard Mitigation Program in each of 
        fiscal years 2013 and 2014 and $750,000,000 in each of fiscal 
        years 2015 through fiscal year 2021. These funds shall be 
        allocated by the Administrator in proportion to the hazard 
        mitigation grants that were allocated to the states in the 
        prior 5 years through Stafford Act allocations.
            (7) State and tribal assistance grants of the environmental 
        protection agency.--For State and Tribal Assistance Grants, 
        $8,000,000,000 shall be provided in each of fiscal years 2013 
        and 2014 and $4,000,000,000 in each of fiscal years 2015 
        through fiscal year 2022 to be allocated as grants under 
        section 1452 of the Safe Drinking Water Act. The funds 
        appropriated by this paragraph shall not be subject to the 
        matching or cost share requirements of sections 602(b)(2), 
        602(b)(3) or 202 of the Federal Water Pollution Control Act nor 
        the matching requirements of section 1452(e) of the Safe 
        Drinking Water Act.
            (8) Supplemental discretionary grants for a national 
        surface transportation system of the department of 
        transportation.--For an additional amount for capital 
        investments in surface transportation infrastructure, 
        $1,500,000,000 in each of fiscal years 2013 and 2014 and 
        $750,000,000 in each of fiscal years 2015 through fiscal year 
        2021 to be awarded by the Secretary of Transportation to State 
        and local governments or transit agencies on a competitive 
        basis for projects that will have a significant impact on the 
        United States, a metropolitan area, or a region: Provided 
        further, That projects eligible for funding provided under this 
        heading shall include highway or bridge projects eligible under 
        title 23, United States Code, including interstate 
        rehabilitation, improvements to the rural collector road 
        system, the reconstruction of overpasses and interchanges, 
        bridge replacements, seismic retrofit projects for bridges, and 
        road realignments; public transportation projects eligible 
        under chapter 53 of title 49, United States Code, including 
        investments in projects participating in the New Starts or 
        Small Starts programs that will expedite the completion of 
        those projects and their entry into revenue service; passenger 
        and freight rail transportation projects; and port 
        infrastructure investments, including projects that connect 
        ports to other modes of transportation and improve the 
        efficiency of freight movement. Not more than 20 percent of the 
        funds made available under this paragraph may be awarded to 
        projects in a single State.
            (9) Federal aviation administration.--$300,000,000 for 
        necessary investments in Federal Aviation Administration to 
        make improvements to power systems, air route traffic control 
        centers, air traffic control towers, terminal radar approach 
        control facilities, and navigation and landing equipment in 
        each of fiscal years 2013 and 2014 and $150,000,000 in each of 
        fiscal years 2015 through fiscal year 2021.
            (10) Grants-In-Aid for airports.--$600,000,000 for 
        ``Grants-In-Aid for Airports'' to make grants for discretionary 
        projects as authorized by subchapter 1 of chapter 471 and 
        subchapter 1 of chapter 475 of title 49, United States Code, 
        and for the procurement, installation and commissioning of 
        runway incursion prevention devices and systems at airports in 
        each of fiscal years 2013 and 2014 and $300,000,000 in each of 
        fiscal years 2015 through fiscal year 2021.
            (11) Federal highway administration.--
                    (A) Highway infrastructure investment.--
                $24,000,000,000 in each of fiscal years 2013 and 2014 
                and $12,000,000,000 in each of fiscal years 2015 
                through fiscal year 2021 to be allocated to the States 
                in proportion to the allocations provided for programs 
                under the administration of the Federal Highway 
                Administration under SAFTEA-LU.
                    (B) Capital assistance for high speed rail 
                corridors and intercity passenger rail service.--For an 
                additional amount for section 501 of Public Law 110-432 
                and discretionary grants to States to pay for the cost 
                of projects described in paragraphs (2)(A) and (2)(B) 
                of section 24401 of title 49, United States Code, 
                subsection (b) of section 24105 of such title, 
                $2,000,000,000 in each of fiscal years 2013 through 
                fiscal year 2021. Not less than 80 percent of these 
                funds shall be allocated to the Federal Railroad 
                Administration for projects that are expected to 
                achieve 125 miles per hour on not less than 50 percent 
                of the route.
            (12) Transit capital assistance of the federal transit 
        administration.--For transit capital grants under the 
        allocations provided for under SAFTEA-LU and its extensions by 
        both formula and competitively, $3,000,000,000 in each of 
        fiscal years 2013 and 2014 and $1,500,000,000 in each of fiscal 
        years 2015 through fiscal year 2021. Not less than one-third of 
        these funds shall be allocated under the discretionary bus 
        program.
            (13) Community development fund of the community planning 
        and development administration.--For an additional amount for 
        ``Community Development Fund'', $2,000,000,000 in each of 
        fiscal years 2013 and 2014 and $1,000,000,000 in each of fiscal 
        years 2015 through fiscal year 2021 to carry out the community 
        development block grant program under title I of the Housing 
        and Community Development Act of 1974 (42 U.S.C. 5301 et seq.): 
         Provided, That the amount appropriated in this paragraph shall 
        be distributed pursuant to 42 U.S.C. 5306 to grantees that 
        received funding in fiscal year 2012. These funds shall be used 
        for capital projects.
    (b) Supplement Not Supplant.--
            (1) In general.--An entity shall use Federal funds made 
        available under this section only to supplement the amount of 
        funds that would, in the absence of such Federal funds, be made 
        available from non-Federal sources for the activities involved.
            (2) Maintenance of effort.--An entity shall ensure that for 
        each fiscal year in which the entity receives Federal funds 
        under this section, the entity will maintain existing non-
        Federal support for the activities for which such funds are 
        provided at not less than the level of such support for the 
        fiscal year preceding the year for which the funds are being 
        provided.
    (c) General Provision.--Each entity that receives assistance with 
amounts made available under this section shall ensure that, if such 
entity carries out modernization, renovation, and repair through a 
contract, any such contract process ensures the maximum number of 
qualified bidders, including small, minority, and women-owned 
businesses, through full and open competition.

          Subtitle B--Rebuilding America's Manufacturing Power

SEC. 111. NATIONAL MANUFACTURING STRATEGY.

    (a) Strategy Required.--
            (1) In general.--Not later than 180 days after the date of 
        the enactment of this Act, the President shall develop a 
        comprehensive national manufacturing strategy.
            (2) Biennial revisions.--Not less frequently than once 
        every 2 years after the date on which the President completes 
        the strategy required by paragraph (1), the President shall 
        revise such strategy.
    (b) Goals of Strategy.--The President shall include in the national 
manufacturing strategy required by subsection (a) short- and long-term 
goals for United States manufacturing, including goals--
            (1) to increase the aggregate number of manufacturing jobs 
        in the United States so that such number is not less than 20 
        percent of the sum of all nonfarm jobs in the United States;
            (2) to identify emerging technologies to strengthen the 
        competitiveness of United States manufacturing in the global 
        marketplace; and
            (3) to strengthen the manufacturing sectors of the United 
        States in which the United States is most competitive in the 
        global economy.
    (c) Information Required.--The national manufacturing strategy 
required by subsection (a) shall include the following:
            (1) A survey of all persons with headquarters in the United 
        States that maintain manufacturing facilities outside of the 
        United States to identify--
                    (A) the categories of products manufactured at such 
                facilities; and
                    (B) the number of manufacturing jobs located at 
                such facilities.
            (2) A survey of all Federal agencies that provide 
        assistance to United States manufacturers, including the 
        following:
                    (A) The Department of Commerce.
                    (B) The Department of Defense.
                    (C) The Department of Energy.
                    (D) The Department of Labor.
                    (E) The Department of the Treasury.
                    (F) The Small Business Administration.
                    (G) The Office of Management and Budget.
                    (H) The Office of Science and Technology Policy.
                    (I) The Office of the United States Trade 
                Representative.
                    (J) The National Science Foundation.
                    (K) Such other Federal agencies as the President 
                considers appropriate.
            (3) A survey of manufacturing goods produced in the United 
        States and where such goods are produced.
            (4) The number of people in the United States employed by 
        manufacturers operating in the United States.
            (5) An evaluation of the global competitiveness of United 
        States manufacturing, including the following:
                    (A) A comparison of the manufacturing policies and 
                strategies of the United States with the policies and 
                strategies of other counties, including the countries 
                that are the top 5 trading partners of the United 
                States.
                    (B) A comparison of the productivity of each sector 
                of the manufacturing industry in the United States with 
                comparable sectors of manufacturing industries in other 
                countries.
    (d) Recommendations.--The President shall include in the national 
manufacturing strategy required by subsection (a) recommendations for 
achieving the goals included in the strategy pursuant to subsection 
(b). Such recommendations may include proposals as follows:
            (1) Actions to be taken by the President, Congress, State, 
        local, and territorial governments, the private sector, 
        universities, industry associations, and other stakeholders.
            (2) Ways to improve Government policies, coordination among 
        entities developing such policies, and Government interaction 
        with the manufacturing sector, including interagency 
        communications regarding the effects of proposed or active 
        Government regulations or other executive actions on the United 
        States manufacturing sector and its workforce.
            (3) How each Federal agency surveyed under subsection 
        (c)(2) can best support the national manufacturing strategy 
        required by subsection (a).
            (4) Adoption of strategies that have been implemented by 
        other countries and proven successful.
    (e) Submittal of Strategy.--Not later than 180 days after the date 
of the enactment of this Act and each time the President revises under 
paragraph (2) of subsection (a) the strategy required by paragraph (1) 
of such subsection, the President shall submit to Congress such 
strategy.

SEC. 112. SECTORAL TECHNOLOGY AND INNOVATION CENTERS.

    The National Institute of Standards and Technology Act (15 U.S.C. 
271 et seq.) is amended by inserting after section 26 (15 U.S.C. 271l) 
the following:

``SEC. 27. SECTORAL TECHNOLOGY AND INNOVATION CENTERS.

    ``(a) Definitions.--In this section:
            ``(1) Eligible entities.--The term `eligible entities' 
        means a consortia that--
                    ``(A) is comprised of representatives from various 
                organizations, such as State and local governments, 
                institutions of higher education, nonprofit 
                organization, and businesses;
                    ``(B) has an expertise in either a specific area of 
                technology or a specific aspect of the manufacturing 
                process; and
                    ``(C) has a capacity to serve small- or medium-
                sized manufacturers across the United States.
            ``(2) Industry cluster.--The term `industry cluster' means 
        a geographic concentration of interconnected companies, 
        specialized suppliers, service providers, and associated 
        institutions in a particular industry sector.
            ``(3) Institution of higher education.--The term 
        `institution of higher education' has the meaning given the 
        term in section 102 of the Higher Education Act of 1965 (20 
        U.S.C. 1002).
            ``(4) Small- or medium-sized manufacturer.--The term 
        `small- or medium-sized manufacturer' means a manufacturer that 
        is a small business concern (as such term is defined in section 
        3 of the Small Business Act (15 U.S.C. 632)).
    ``(b) Grants Authorized.--
            ``(1) In general.--The Secretary may award grants to 
        eligible entities to establish sectoral technology and 
        innovation centers--
                    ``(A) to improve the capacity of small- or medium-
                sized manufacturers to innovate;
                    ``(B) to provide assistance to small- or medium-
                sized manufacturers with early-stage product 
                development;
                    ``(C) to help small- or medium-sized manufacturers 
                improve the speed with which they commercialize new 
                products, processes, and technologies;
                    ``(D) to help small- or medium-sized manufacturers 
                reduce costs by improving efficiencies in the 
                manufacturing process, including through reduced energy 
                use and environmental waste;
                    ``(E) to link small- or medium-sized manufacturers 
                with cutting edge research and technologies developed 
                by employees of institutions of higher education or 
                other institutions that conduct scientific research; 
                and
                    ``(F) to facilitate the sharing of information and 
                best practices relating to manufacturing and product 
                development among the following:
                            ``(i) Small- or medium-sized manufacturers.
                            ``(ii) Federal and State agencies that 
                        provide assistance to small- or medium-sized 
                        manufacturers.
                            ``(iii) Nongovernmental organizations that 
                        provide assistance to small- or medium-sized 
                        manufacturers.
                            ``(iv) Institutions of higher education.
            ``(2) Minimum number of sectoral technology and innovation 
        centers.--In awarding grants under paragraph (1), the Secretary 
        shall ensure that not fewer than 25 sectoral technology and 
        innovation centers are established under this section before 
        the date that is 2 years after the date of the enactment of 
        this section.
    ``(c) Use of Funds.--
            ``(1) In general.--Grants awarded pursuant to subsection 
        (b)(1) shall be used to establish a sectoral technology and 
        innovation center that offers a range of services for the 
        purposes described in paragraphs (1) through (6) of such 
        subsection, including services relating to the following:
                    ``(A) Applied research and development.
                    ``(B) Proof-of-concept development and prototyping.
                    ``(C) Manufacturing process development and 
                efficiency enhancements.
                    ``(D) Other technical business matters.
            ``(2) Focus.--Each technology innovation center established 
        with a grant awarded under subsection (b)(1) shall be 
        established with a focus on a specific technology area or 
        specific aspect of the manufacturing process corresponding 
        with--
                    ``(A) the expertise of the eligible entity 
                establishing the center; and
                    ``(B) the needs of an industry cluster located in 
                geographic proximity to the center.
            ``(3) Change in services provided.--The Secretary may allow 
        a recipient of a grant under subsection (b)(1) to modify the 
        range of services offered by the recipient's technology 
        innovation center under paragraph (1) of this subsection.
            ``(4) Affiliation with institutions of higher education and 
        national laboratories.--Services offered by a technology 
        innovation center under paragraph (1) shall be offered in 
        affiliation with an institution of higher education or a 
        national laboratory.
    ``(d) Application for Grants.--
            ``(1) In general.--An eligible entity seeking a grant under 
        subsection (b)(1) shall submit to the Secretary an application 
        therefor in such form and in such manner as the Secretary 
        considers appropriate.
            ``(2) Process required.--The Secretary shall establish a 
        standardized application process for purposes of awarding 
        grants under subsection (b)(1).
            ``(3) Solicitation of applications.--The Secretary shall 
        solicit applications for grants under subsection (b) from 
        eligible entities.
    ``(e) Selection of Grant Recipients.--
            ``(1) Competitive basis.--Grants awarded under subsection 
        (b)(1) shall be awarded on a competitive basis.
            ``(2) Preferences.--In selecting grant recipients, the 
        Secretary shall give preference to an eligible entity that--
                    ``(A) has an expertise in a specific technology 
                area or manufacturing process that is needed by an 
                industry cluster;
                    ``(B) agrees to establish a technology innovation 
                center in the geographical area of such industry 
                cluster;
                    ``(C) represents a broad range of stakeholders; and
                    ``(D) can demonstrate that the non-Federal 
                contributions for the operation of the technology 
                innovation center will be significant.
            ``(3) Consultation.--In selecting grant recipients, the 
        Secretary shall consult with the Secretary of Agriculture, the 
        Secretary of Defense, the Secretary of Energy, the Secretary of 
        Labor, the Assistant Secretary for Economic Development, the 
        National Science Foundation, the Office of Innovation and 
        Entrepreneurship, and such other Federal agencies as may be 
        appropriate to determine whether applicants have sufficient 
        expertise to establish a technology innovation center as 
        described in paragraphs (1) and (2) of subsection (c).
    ``(f) Federal Share.--An eligible entity that receives a grant 
under subsection (b)(1) shall provide such non-Federal contributions 
for the operation of the sectoral technology and innovation center 
established with such grant as the Secretary considers appropriate.
    ``(g) User Fees.--An eligible entity that establishes a technology 
innovation center with a grant awarded under subsection (b)(1) may 
establish user fees to be paid by recipients of services provided by 
the center to meet the operating costs of the center or for purposes of 
providing non-Federal contributions as required by subsection (f).
    ``(h) Funding.--There shall be made available from the Rebuild 
America Trust Fund under section 9512 of the Internal Revenue Code of 
1986, the following amount to carry out this section:
            ``(1) $1,000,000,000 for fiscal year 2013.
            ``(2) $2,500,000,000 for fiscal year 2014.
            ``(3) $2,500,000,000 for fiscal year 2015.
            ``(4) $1,000,000,000 for each of fiscal years 2016 through 
        2022.''.

SEC. 113. CAPITAL FOR SMALL MANUFACTURERS WITH FIRM ORDERS.

    (a) In General.--Section 7(a) of the Small Business Act (15 U.S.C. 
636(a)) is amended by adding at the end the following:
            ``(36) Capital for small manufacturers with firm orders.--
                    ``(A) Definitions.--In this paragraph--
                            ``(i) the term `firm order' means an order 
                        for goods placed by a person that the 
                        Administrator determines is--
                                    ``(I) required by law or contract 
                                to pay for the goods upon receipt of 
                                the goods; and
                                    ``(II) likely to make the payment 
                                described in subclause (I); and
                            ``(ii) the term `manufacturer' means a 
                        small business concern the primary business of 
                        which is classified in sector 31, 32, or 33 of 
                        the North American Industrial Classification 
                        System.
                    ``(B) In general.--The Administrator may guarantee 
                a loan under this subsection to a manufacturer, to 
                provide capital for the production of goods for a firm 
                order, if the Administrator determines that the 
                manufacturer will be able to produce the goods using 
                the capital.
                    ``(C) Amount.--A loan guaranteed under this 
                paragraph shall be in an amount that is not more than 
                $10,000,000.
                    ``(D) Guarantee percentage.--The Administrator may 
                guarantee not more than 95 percent of the amount of a 
                loan under this paragraph.''.
    (b) Technical and Conforming Amendments.--Section 1133(b) of the 
Small Business Jobs Act of 2010 (15 U.S.C. 636 note) is amended--
            (1) in paragraph (1), by striking ``and'' at the end;
            (2) in paragraph (2), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(3) by redesignating paragraph (36), as added by section 
        113 of the Rebuild America Act, as paragraph (35).''.

SEC. 114. MANUFACTURING EXTENSION PARTNERSHIP.

    (a) In General.--There shall be made available from the Rebuild 
America Trust Fund under section 9512 of the Internal Revenue Code of 
1986, $130,000,000 for each of fiscal years 2013 through 2022 for the 
Hollings Manufacturing Extension Partnership of the National Institute 
of Standards and Technology.
    (b) Adjustments for Inflation.--For fiscal year 2014 and each 
fiscal year thereafter, the amount specified in subsection (a) shall be 
adjusted to reflect the percentage (if any) of the increase or decrease 
(as the case may be) in the average of the Consumer Price Index for the 
12-month period ending on the April 30 preceding the beginning of the 
fiscal year compared to the average of the Consumer Price Index for the 
12-month period ending April 30, 2012.

SEC. 115. EXTENSION OF RESEARCH CREDIT; INCREASE IN ALTERNATIVE 
              SIMPLIFIED RESEARCH CREDIT.

    (a) Extension of Credit.--
            (1) In general.--Subparagraph (B) of section 41(h)(1) of 
        the Internal Revenue Code of 1986 is amended by striking 
        ``December 31, 2011'' and inserting ``December 31, 2016''.
            (2) Conforming amendment.--Subparagraph (D) of section 
        45C(b)(1) of such Code is amended by striking ``December 31, 
        2011'' and inserting ``December 31, 2016''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to amounts paid or incurred after December 31, 
        2011.
    (b) Alternative Simplified Research Credit Increased.--
            (1) Increased credit.--Subparagraph (A) of section 41(c)(5) 
        of the Internal Revenue Code of 1986 is amended to read as 
        follows:
                    ``(A) Determination of credit.--
                            ``(i) In general.--At the election of the 
                        taxpayer, the credit determined under 
                        subsection (a)(1) shall be equal to the 
                        applicable percentage of so much of the 
                        qualified research expenses for the taxable 
                        year as exceeds 50 percent of the average 
                        qualified research expenses for the 3 taxable 
                        years preceding the taxable year for which the 
                        credit is being determined.
                            ``(ii) Applicable percentage.--For purposes 
                        of clause (i), the applicable percentage for 
                        any taxable year is equal to--
                                    ``(I) 14 percent, increased by
                                    ``(II) 1 percentage point (not to 
                                exceed 6 percentage points) for each 2 
                                percent increase in the taxpayer's 
                                qualified manufacturing full-time 
                                equivalent employees during the 5-
                                taxable-year period ending immediately 
                                before such taxable year.
                            ``(iii) Limitation.--The increase in the 
                        amount of the credit determined under 
                        subsection (a)(1) by reason of the application 
                        of clause (ii)(II) shall not exceed the product 
                        of--
                                    ``(I) $5,000, multiplied by
                                    ``(II) the number of qualified 
                                manufacturing full-time equivalent 
                                employees taken into account for 
                                purposes of determining the increase 
                                described in clause (ii)(II).
                            ``(iv) Qualified manufacturing full-time 
                        equivalent employees.--For purposes of this 
                        subparagraph, the term `qualified manufacturing 
                        full-time equivalent employees' means full-time 
                        equivalent employees (as defined in section 
                        45R(d)(2)) who provide the taxpayer 
                        manufacturing services in the United States.
                            ``(v) Employees excluded for changes in 
                        ownership of trades or businesses.--In 
                        determining the number of qualified 
                        manufacturing full-time equivalent employees 
                        for any 5-taxable-year period referred to in 
                        clause (ii)(II), the taxpayer shall not take 
                        into account--
                                    ``(I) any individual who was an 
                                employee, on the date of acquisition, 
                                of any trade or business acquired by 
                                the taxpayer during such period, and
                                    ``(II) any individual who was an 
                                employee of any trade or business 
                                disposed of by the taxpayer during such 
                                period.
                            ``(vi) Manufacturing services.--For 
                        purposes of this subparagraph, the term 
                        `manufacturing services' means qualified 
                        production activities within the meaning of 
                        section 199(c) other than the extraction of 
                        fossil fuels or minerals, agricultural 
                        production, activities described in section 
                        199(b)(2)(D), or activities described in 
                        199(c)(4)(B).''.
            (2) Conforming amendment.--Section 41(c)(5)(B)(ii) of such 
        Code is amended by striking ``6 percent'' and inserting ``one-
        half of the applicable percentage''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to taxable years beginning after December 31, 2016.
    (c) Technical Corrections.--
            (1) In general.--Section 409 of the Internal Revenue Code 
        of 1986 is amended--
                    (A) by inserting ``, as in effect before the 
                enactment of the Tax Reform Act of 1984)'' after 
                ``section 41(c)(1)(B)'' in subsection (b)(1)(A),
                    (B) by inserting ``, as in effect before the 
                enactment of the Tax Reform Act of 1984'' after 
                ``relating to the employee stock ownership credit'' in 
                subsection (b)(4),
                    (C) by inserting ``(as in effect before the 
                enactment of the Tax Reform Act of 1984)'' after 
                ``section 41(c)(1)(B)'' in subsection (i)(1)(A),
                    (D) by inserting ``(as in effect before the 
                enactment of the Tax Reform Act of 1984)'' after 
                ``section 41(c)(1)(B)'' in subsection (m),
                    (E) by inserting ``(as so in effect)'' after 
                ``section 48(n)(1)'' in subsection (m),
                    (F) by inserting ``(as in effect before the 
                enactment of the Tax Reform Act of 1984)'' after 
                ``section 48(n)'' in subsection (q)(1), and
                    (G) by inserting ``(as in effect before the 
                enactment of the Tax Reform Act of 1984)'' after 
                ``section 41'' in subsection (q)(3).
            (2) Effective date.--The amendments made by this subsection 
        shall take effect on the date of the enactment of this Act.

SEC. 116. INCLUSION OF CERTAIN PROVISIONS IN TRADE AGREEMENTS.

    (a) Definitions.--In this section:
            (1) Core labor rights.--The term ``core labor rights'' 
        means the core labor rights as stated in the International 
        Labour Organization conventions dealing with--
                    (A) freedom of association and the effective 
                recognition of the right to collective bargaining;
                    (B) the elimination of all forms of forced or 
                compulsory labor;
                    (C) the effective abolition of child labor; and
                    (D) the elimination of discrimination with respect 
                to employment and occupation.
            (2) Multilateral environmental agreement.--The term 
        ``multilateral environmental agreement'' means any 
        international agreement or provision thereof to which the 
        United States is a party and that is intended to protect, or 
        has the effect of protecting, the environment or human health.
    (b) Limitation on Consideration of Bills Implementing Trade 
Agreements.--Notwithstanding section 151 of the Trade Act of 1974 (19 
U.S.C. 2191) or any other provision of law, any bill implementing a 
trade agreement between the United States and another country that is 
introduced in Congress after the date of the enactment of this Act 
shall be subject to a point of order pursuant to subsection (d) unless 
the trade agreement meets the requirements described in subsection (c).
    (c) Requirements.--Each trade agreement between the United States 
and another country with respect to which an implementing bill is 
introduced on or after the date of the enactment of this Act shall meet 
the following requirements:
            (1) Labor standards.--The labor provisions of the agreement 
        shall--
                    (A) be included in the core text of the agreement;
                    (B) require each country that is a party to the 
                agreement--
                            (i) to adopt and maintain laws and 
                        regulations (including laws applicable to any 
                        designated zone in the country) that establish 
                        core labor rights; and
                            (ii) to effectively enforce laws relating 
                        to core labor rights and laws relating to 
                        acceptable conditions of work (including laws 
                        relating to minimum wages, hours of work, and 
                        occupational safety and health);
                    (C) prohibit a country that is a party to the 
                agreement from waiving or otherwise derogating from, or 
                offering to waive or otherwise derogate from, the 
                country's laws and regulations relating to the core 
                labor rights and acceptable conditions of work 
                described in subparagraph (B);
                    (D) provide that failures to meet the labor 
                requirements of the agreement, regardless of the effect 
                that failure has on trade, shall be subject to the 
                dispute resolution and enforcement mechanisms and 
                penalties of the agreement;
                    (E) provide that enforcement mechanisms and 
                penalties for failures described in subparagraph (D) 
                are included in the core text of the agreement and are 
                at least as effective as the mechanisms and penalties 
                that apply to the commercial provisions of the 
                agreement; and
                    (F) strengthen the capacity of each country that is 
                a party to the agreement to promote, protect, and 
                enforce core labor rights.
            (2) Environmental and public safety standards.--The 
        environmental provisions of the agreement shall--
                    (A) be included in the text of the agreement;
                    (B) prohibit each country that is a party to the 
                agreement from weakening, eliminating, or failing to 
                enforce domestic environmental or other public interest 
                standards to promote trade or attract investment;
                    (C) require each such country to implement and 
                enforce fully and effectively the country's obligations 
                under multilateral environmental agreements and provide 
                for the enforcement of such obligations under the 
                agreement;
                    (D) prohibit the trade of products that are 
                illegally harvested or extracted and the trade of goods 
                derived from illegally harvested or extracted natural 
                resources, including timber and timber products, fish, 
                wildlife, and associated products, mineral resources, 
                or other environmentally sensitive goods;
                    (E) provide that the failure to meet the 
                environmental standards required by the agreement be 
                subject to dispute resolution and enforcement 
                mechanisms and penalties that are at least as effective 
                as the mechanisms and penalties that apply to the 
                commercial provisions of the agreement; and
                    (F) allow each country that is a party to the 
                agreement to adopt and implement environmental, health, 
                and safety standards, recognizing the legitimate right 
                of governments to protect the environment and public 
                health and safety.
            (3) Investment provisions.--If the agreement contains 
        provisions relating to investment, such provisions shall--
                    (A) ensure that foreign investors operating in the 
                United States are not afforded greater procedural or 
                substantive rights under the trade agreement than those 
                afforded to domestic investors under the Constitution 
                and laws of the United States;
                    (B) include strong and enforceable commitments that 
                an entity owned or controlled by a foreign government 
                that invests in operations in the United States--
                            (i) will make such investments and will 
                        conduct such operations on a commercial basis 
                        only; and
                            (ii) will not receive benefits, such as 
                        financing, at below market rates, or components 
                        or materials at below market prices, from the 
                        foreign government for such operations; and
                    (C) define the standard of minimum treatment to 
                provide that foreign investors do not have greater 
                legal rights than United States citizens possess under 
                the due process clause of section 1 of the 14th 
                Amendment to the Constitution.
    (d) Point of Order in Senate.--The Senate shall cease consideration 
of a bill to implement a trade agreement introduced on or after the 
date of enactment of this Act if--
            (1) a point of order is made by any Senator against the 
        bill based on the noncompliance of the trade agreement with the 
        requirements of subsection (c); and
            (2) the point of order is sustained by the Presiding 
        Officer.
    (e) Waivers and Appeals.--
            (1) Waivers.--Before the Presiding Officer rules on a point 
        of order described in subsection (d), any Senator may move to 
        waive the point of order and the motion to waive shall not be 
        subject to amendment. A point of order described in subsection 
        (d) is waived only by the affirmative vote of 60 Members of the 
        Senate, duly chosen and sworn.
            (2) Appeals.--After the Presiding Officer rules on a point 
        of order described in subsection (d), any Senator may appeal 
        the ruling of the Presiding Officer on the point of order as it 
        applies to some or all of the provisions on which the Presiding 
        Officer ruled. A ruling of the Presiding Officer on a point of 
        order described in subsection (d) is sustained unless 60 
        Members of the Senate, duly chosen and sworn, vote not to 
        sustain the ruling.
            (3) Debate.--Debate on the motion to waive under paragraph 
        (1) or on an appeal of the ruling of the Presiding Officer 
        under paragraph (2) shall be limited to 1 hour. The time shall 
        be equally divided between, and controlled by, the majority 
        leader and the minority leader of the Senate, or their 
        designees.

SEC. 117. FUNDING FOR INTERAGENCY TRADE ENFORCEMENT CENTER.

    (a) In General.--There shall be made available from the Rebuild 
America Trust Fund under section 9512 of the Internal Revenue Code of 
1986, the following amounts for the Interagency Trade Enforcement 
Center established by Executive Order of February 28, 2012, entitled 
``Establishment of the Interagency Trade Enforcement Center'':
            (1) For fiscal year 2013, $26,000,000.
            (2) For fiscal year 2014 and each fiscal year thereafter, 
        the amount specified in paragraph (1), as adjusted to reflect 
        the percentage (if any) of the increase or decrease (as the 
        case may be) in the average of the Consumer Price Index for the 
        12-month period ending on the April 30 preceding the beginning 
        of the fiscal year compared to the average of the Consumer 
        Price Index for the 12-month period ending April 30, 2012.
    (b) Consumer Price Index Defined.--In this section, the term 
``Consumer Price Index'' means the Consumer Price Index for All Urban 
Consumers published by the Bureau of Labor Statistics of the Department 
of Labor.

SEC. 118. IMPOSITION OF COUNTERVAILING DUTIES FOR SUBSIDIES RELATING TO 
              FUNDAMENTALLY UNDERVALUED CURRENCIES.

    (a) Benefit Conferred.--Section 771(5)(E) of the Tariff Act of 1930 
(19 U.S.C. 1677(5)(E)) is amended--
            (1) in clause (iii), by striking ``and'' at the end;
            (2) in clause (iv), by striking the period at the end and 
        inserting ``, and''; and
            (3) by inserting after clause (iv) the following new 
        clause:
                            ``(v) in the case in which the currency of 
                        a country in which the subject merchandise is 
                        produced is exchanged for foreign currency 
                        obtained from export transactions, and the 
                        currency of such country is a fundamentally 
                        undervalued currency, as defined in paragraph 
                        (37), if there is a difference between the 
                        amount of the currency of such country provided 
                        and the amount of the currency of such country 
                        that would have been provided if the real 
                        effective exchange rate of the currency of such 
                        country were not undervalued, as determined 
                        pursuant to paragraph (38).''.
    (b) Export Subsidy.--Section 771(5A)(B) of the Tariff Act of 1930 
(19 U.S.C. 1677(5A)(B)) is amended by adding at the end the following 
new sentence: ``In the case of a subsidy relating to a fundamentally 
undervalued currency, the fact that the subsidy may also be provided in 
circumstances not involving export shall not, for that reason alone, 
mean that the subsidy cannot be considered contingent upon export 
performance.''.
    (c) Definition of Fundamentally Undervalued Currency.--Section 771 
of the Tariff Act of 1930 (19 U.S.C. 1677) is amended by adding at the 
end the following new paragraph:
            ``(37) Fundamentally undervalued currency.--The 
        administering authority shall determine that the currency of a 
        country in which the subject merchandise is produced is a 
        `fundamentally undervalued currency' if--
                    ``(A) the government of the country (including any 
                public entity within the territory of the country) 
                engages in protracted, large-scale intervention in one 
                or more foreign exchange markets during part or all of 
                the 18-month period that represents the most recent 18 
                months for which the information required under 
                paragraph (38) is reasonably available, but that does 
                not include any period of time later than the final 
                month in the period of investigation or the period of 
                review, as applicable;
                    ``(B) the real effective exchange rate of the 
                currency is undervalued by at least 5 percent, on 
                average and as calculated under paragraph (38), 
                relative to the equilibrium real effective exchange 
                rate for the country's currency during the 18-month 
                period;
                    ``(C) during the 18-month period, the country has 
                experienced significant and persistent global current 
                account surpluses; and
                    ``(D) during the 18-month period, the foreign asset 
                reserves held by the government of the country exceed--
                            ``(i) the amount necessary to repay all 
                        debt obligations of the government falling due 
                        within the coming 12 months;
                            ``(ii) 20 percent of the country's money 
                        supply, using standard measures of M2; and
                            ``(iii) the value of the country's imports 
                        during the previous 4 months.''.
    (d) Definition of Real Effective Exchange Rate Undervaluation.--
Section 771 of the Tariff Act of 1930 (19 U.S.C. 1677), as amended by 
subsection (c) of this section, is further amended by adding at the end 
the following new paragraph:
            ``(38) Real effective exchange rate undervaluation.--The 
        calculation of real effective exchange rate undervaluation, for 
        purposes of paragraph (5)(E)(v) and paragraph (37), shall--
                    ``(A)(i) rely upon, and where appropriate be the 
                simple average of, the results yielded from application 
                of the approaches described in the guidelines of the 
                International Monetary Fund's Consultative Group on 
                Exchange Rate Issues; or
                    ``(ii) if the guidelines of the International 
                Monetary Fund's Consultative Group on Exchange Rate 
                Issues are not available, be based on generally 
                accepted economic and econometric techniques and 
                methodologies to measure the level of undervaluation;
                    ``(B) rely upon data that are publicly available, 
                reliable, and compiled and maintained by the 
                International Monetary Fund or, if the International 
                Monetary Fund cannot provide the data, by other 
                international organizations or by national governments; 
                and
                    ``(C) use inflation-adjusted, trade-weighted 
                exchange rates.''.
    (e) Application to Goods From Canada and Mexico.--Pursuant to 
article 1902 of the North American Free Trade Agreement and section 408 
of the North American Free Trade Agreement Implementation Act of 1993 
(19 U.S.C. 3438), the amendments made by this section shall apply to 
goods from Canada and Mexico.

       Subtitle C--Preparing Americans for the Jobs of the Future

SEC. 121. SHORT TITLE.

    This subtitle may be cited as the ``Regional Partnerships for High-
Quality Jobs Act''.

SEC. 122. DEFINITIONS.

    In this subtitle:
            (1) Career and technical education system.--The term 
        ``career and technical education system'' means, with respect 
        to a State, the eligible agency (as defined in section 3 of the 
        Carl D. Perkins Career and Technical Education Act of 2006 (20 
        U.S.C. 2302)) for the State, and the eligible recipients (as so 
        defined) in the State that receive funds under section 131 or 
        132 of such Act (20 U.S.C. 2351, 2352).
            (2) Career pathway.--
                    (A) In general.--The term ``career pathway'' means 
                a set of rigorous, engaging, and high-quality 
                education, occupational training, and other services to 
                prepare individuals to meet a set of career-related 
                objectives as referenced in subparagraph (C).
                    (B) Services.--The services referred to in 
                subparagraph (A) shall be--
                            (i) aligned with the skill needs of 
                        industries in the economy of the service area 
                        involved; and
                            (ii) designed to increase an individual's 
                        educational and skill attainment, and improve 
                        the individual's employment outcomes and 
                        ability to meet career-related objectives, by--
                                    (I) preparing individuals for the 
                                full range of secondary or 
                                postsecondary education options, 
                                including apprenticeships registered 
                                under the Act of August 16, 1937 
                                (commonly known as the ``National 
                                Apprenticeship Act''; 50 Stat. 664, 
                                chapter 663; 29 U.S.C. 50 et seq.) 
                                (referred to individually in this 
                                subtitle as an ``apprenticeship'');
                                    (II) including counseling and 
                                support services to help individuals 
                                achieve their education and career 
                                goals;
                                    (III) including, as appropriate for 
                                an individual, education offered 
                                concurrently with and in the same 
                                context as workforce preparation 
                                activities and training for a specific 
                                occupation or occupational cluster; and
                                    (IV) organizing education, 
                                occupational training, and other 
                                services to meet the particular needs 
                                of the individual in a manner that 
                                accelerates the educational and career 
                                advancement of the individual to the 
                                extent practicable.
                    (C) Objectives.--The objectives referred to in 
                subparagraph (A) include--
                            (i) enabling a worker to attain a secondary 
                        school diploma or its recognized equivalent, 
                        and at least 1 recognized postsecondary 
                        credential; and
                            (ii) helping a worker enter or advance 
                        within a specific occupation or occupational 
                        cluster.
            (3) Community college.--The term ``community college'' has 
        the same meaning as the term ``junior or community college'', 
        as defined in section 312(f) of the Higher Education Act of 
        1965 (20 U.S.C. 1058(f)).
            (4) Education terms.--The term ``adult education'' has the 
        meaning given the term in section 203 of the Adult Education 
        and Family Literacy Act (20 U.S.C. 9202). The terms ``State 
        educational agency'' and ``local educational agency'' have the 
        meanings given the terms in section 9101 of the Elementary and 
        Secondary Education Act of 1965 (20 U.S.C. 7801).
            (5) High-quality employment.--The term ``high-quality 
        employment'' means employment with, at a minimum, family-
        sustaining compensation (as determined by the Secretaries) and 
        opportunities for advancement (as so determined).
            (6) Individual with a disability; individuals with 
        disabilities.--
                    (A) Individual with a disability.--The term 
                ``individual with a disability'' has the meaning given 
                the term in section 7(20)(A) of the Rehabilitation Act 
                of 1973 (29 U.S.C. 705(20)(A)).
                    (B) Individuals with disabilities.--The term 
                ``individuals with disabilities'' means more than 1 
                individual with a disability.
            (7) Industry-recognized credential.--The term ``industry-
        recognized credential'' means such a credential within the 
        meaning of section 3 of the Carl D. Perkins Career and 
        Technical Education Act of 2006 (20 U.S.C. 2302).
            (8) Labor organization.--The term ``labor organization'' 
        has the meaning given the term in section 2 of the National 
        Labor Relations Act (29 U.S.C. 152).
            (9) Occupational training.--The term ``occupational 
        training'' means training services, as described in section 
        134(d)(4)(D) of the Workforce Investment Act of 1998 (29 U.S.C. 
        2864(d)(4)(D)).
            (10) Priority workers.--The term ``priority workers'' means 
        individuals who are--
                    (A) individuals unemployed for 52 weeks or more;
                    (B) youth age 16 through 24 who have been out of 
                school or out of work, as appropriate, for more than 6 
                months and do not possess a secondary school diploma or 
                its recognized equivalent;
                    (C) individuals with disabilities;
                    (D) individuals with low literacy levels; or
                    (E) veterans, as defined in section 101 of title 
                38, United States Code.
            (11) Recognized postsecondary credential.--The term 
        ``recognized postsecondary credential'' means a credential 
        consisting of an industry-recognized credential, a certificate 
        of completion of an apprenticeship registered under the Act of 
        August 16, 1937 (commonly known as the ``National 
        Apprenticeship Act''; 50 Stat. 664, chapter 663; 29 U.S.C. 50 
        et seq.), or an associate or baccalaureate degree.
            (12) Secretaries.--The term ``Secretaries'' means the 
        Secretary of Education and the Secretary of Labor, acting in 
        accordance with the agreement described in section 123(c).
            (13) Service area.--The term ``service area''--
                    (A) used with respect to a regional partnership, 
                means a labor market area; and
                    (B) used with respect to a State partnership, means 
                2 or more labor market areas in the State that are 
                identified by the State partnership.

SEC. 123. PROGRAM.

    (a) In General.--The Secretary of Labor and the Secretary of 
Education shall establish a program to educate and train workers for 
high-quality employment.
    (b) Grants.--
            (1) In general.--In carrying out the program, the 
        Secretaries shall award grants, on a competitive basis, to 
        eligible entities to develop or enhance, and provide, career 
        pathways and adult learning strategies that integrate 
        education, occupational training, and supportive services. The 
        career pathways and learning strategies shall prepare 
        individuals for existing or emerging employment opportunities 
        in a service area, which shall include such preparation through 
        the attainment of a recognized postsecondary credential.
            (2) Grant period.--A grant awarded to an eligible entity 
        under this section shall be awarded for a period of not more 
        than 5 years. The grant may be renewed for not more than 1 such 
        additional grant period, contingent on satisfactory performance 
        of the eligible entity relating to the expected outcomes 
        described in section 125(1).
            (3) Partnerships.--The eligible entities shall provide the 
        career pathways and learning strategies through industry-
        focused, employer-linked regional or State partnerships 
        described in section 124.
    (c) Agreement.--The Secretary of Labor and the Secretary of 
Education shall enter into an interagency agreement that describes how 
the Secretaries will jointly administer the program.

SEC. 124. ELIGIBLE ENTITIES.

    (a) In General.--To be eligible to receive a grant under section 
123 for a service area, an entity shall consist of a partnership 
described in section 123(b)--
            (1) that shall include--
                    (A) employers of various sizes in the service area, 
                whose job vacancies represent a significant share of 
                current or future job vacancies, and that pledge to 
                train or employ participants in the project carried out 
                under the grant; and
                    (B) community colleges that will provide education 
                and occupational training, aligned with current or 
                future job vacancies, through the project; and
            (2) that shall include at least 1 of the following:
                    (A) A State agency.
                    (B) A chief elected official, as defined in section 
                101 of the Workforce Investment Act of 1998 (29 U.S.C. 
                2801).
                    (C) A nonprofit organization with a demonstrated 
                record of serving priority workers.
                    (D) Local boards or State boards as such terms are 
                defined in section 101 of the Workforce Investment Act 
                of 1998 (29 U.S.C. 2801), or designated State units, as 
                defined in section 7 of the Rehabilitation Act of 1973 
                (29 U.S.C. 705) or other vocational rehabilitation 
                offices.
                    (E) An economic development agency.
                    (F) A local educational agency.
                    (G) A labor organization or labor-management 
                partnership.
                    (H) An adult education provider.
                    (I) An agency, which may be a public library, that 
                provides occupational training or supportive services.
    (b) State or Regional Partnership.--The partnership described in 
subsection (a) may be--
            (1) a State partnership, serving 2 or more labor market 
        areas in the State; or
            (2) a regional partnership, serving a labor market area.

SEC. 125. APPLICATIONS.

    To be eligible to receive a grant under section 123, an entity 
described in section 124 shall submit an application to the Secretaries 
at such time, in such manner, and containing such information as the 
Secretaries may determine to be appropriate, including, at a minimum, a 
plan for the project to be carried out under the grant, with 
information describing each of the following:
            (1) How the partnership will address the objectives of the 
        project, including identifying a fiscal agent and expected 
        outcomes for the partnership.
            (2) How the partnership will develop or enhance career 
        pathways that result in the attainment of a recognized 
        postsecondary credential and high-quality employment in the 
        service area, including--
                    (A) a description of how the partnership has used 
                labor market information (including projections of job 
                openings, job growth, wages, and skill and 
                certification requirements related to the credential) 
                to ensure the education and occupational training 
                provided through the grant are aligned with employment 
                needs in the service area;
                    (B) a description of how the partnership has 
                incorporated best practices in adult education and 
                occupational training, such as use of cohort models, 
                compressed course schedules, integrated adult basic 
                education, and work readiness training and 
                certificates;
                    (C) information on how the partnership will 
                identify and prepare workers for employment 
                opportunities;
                    (D) an analysis of how the partnership will engage 
                the entities described in section 124(a)(2), to 
                leverage resources and optimize outcomes, including by 
                coordinating existing (as of the date the grant is 
                received) education and occupational training efforts; 
                and
                    (E) a description of how the partnership will 
                conduct data collection, monitoring, reporting, and 
                information sharing to continuously evaluate and 
                improve outcomes for the project.
            (3) The commitment of members of the partnership, 
        including--
                    (A) each partner's financial and programmatic 
                commitment to the strategies described in the 
                application;
                    (B) each partner's capacity, such as capacity to 
                provide staff and facilities, to leverage State and 
                local investments, to coordinate activities with 
                related agencies, and to establish linkages among 
                employment and labor market information data systems, 
                to support the strategies described in the application;
                    (C) each partner's long-term commitment to the 
                partnership that, at a minimum, accounts for the cost 
                of supporting the project, including providing support 
                after grant funds are no longer available; and
                    (D) each partner's commitment to ensure sound 
                fiscal management and controls, including evidence of a 
                related system of supports and personnel.
            (4) How the partnership will make work experiences 
        available to all priority workers, including--
                    (A) the types of paid internships, on-the-job 
                training, or other work experiences the partnership 
                will make available to all priority workers; and
                    (B) how the partnership will provide any 
                developmental education or supportive services 
                necessary to ensure priority workers receive and 
                succeed in work experiences.
            (5) How the partnership will engage community-based 
        organizations with experience providing education, occupational 
        training, and related supportive services to individuals in the 
        service area, with particular attention to such organizations 
        that have experience supporting priority workers.
            (6) The Federal and non-Federal sources of funding that the 
        partnership will secure to comply with the matching funds 
        requirement set forth in section 128.
            (7) In the case of a State partnership, how the partnership 
        will carry out goals described in section 127(b)(1)(B).

SEC. 126. PRIORITY AND DISTRIBUTION.

    (a) Priority.--The Secretaries shall give priority consideration to 
a partnership that--
            (1) includes in the partnership involved a labor 
        organization, labor-management partnership, or community-based 
        organization that represents the interests of workers, 
        especially priority workers; or
            (2) is a partnership serving at least 1 labor market area 
        with 1 of the highest levels of unemployment or poverty, as 
        defined by the Secretaries, in the Nation.
    (b) Geographic Diversity.--In administering the grants awarded 
under section 123, the Secretaries shall ensure geographic diversity in 
the distribution of funds to regional and State partnerships.

SEC. 127. USE OF FUNDS.

    (a) In General.--An eligible entity that receives a grant under 
section 123 shall use the grant funds to implement the plan described 
in the entity's application, submitted under section 125.
    (b) Partnerships.--
            (1) Partnerships, career pathways, and learning 
        strategies.--
                    (A) In general.--A partnership that receives a 
                grant under section 123 shall use the grant funds for 
                investments designed to develop or enhance, and 
                provide, through an industry-focused, employer-linked 
                partnership, career pathways and adult learning 
                strategies that connect individuals with existing or 
                emerging employment opportunities.
                    (B) Additional uses.--In addition, a partnership 
                described in section 124(b)(1) shall use the grant 
                funds to support the activities described in 
                subparagraph (A) by--
                            (i) supporting programs of tuition 
                        assistance, using funding resources, and 
                        through other evidence-based strategies, except 
                        that such support shall not supplant other 
                        Federal funds for such tuition assistance;
                            (ii) providing incentives and technical 
                        support to employers who, through participation 
                        in industry-focused, employer-linked 
                        partnerships, or through provision of career 
                        pathways or adult learning strategies, retain 
                        and promote incumbent workers, employ new 
                        workers, or upgrade jobs for program 
                        participants; and
                            (iii) for State partnerships, enhancing 
                        linkages among employment and labor market 
                        information data systems in the State.
            (2) Services for priority workers.--The partnership shall 
        use at least 50 percent of the grant funds to support the 
        pathways and strategies and provide supportive services for 
        priority workers.
            (3) Conditions of education and occupational training.--
                    (A) Training leading to jobs.--All education and 
                occupational training provided through the project 
                shall lead to high-quality employment provided by, at a 
                minimum, the employers represented in the partnership, 
                and also including other employers of all sizes in the 
                service area.
                    (B) Internships.--Paid internship positions 
                provided through the project shall be primarily 
                occupational training positions, and the internships 
                may not permit interns to spend a significant amount of 
                time doing work for which an employee would otherwise 
                be compensated.
                    (C) On-the-job training.--On-the-job training 
                placements--
                            (i) provided through the project shall pay 
                        wages comparable to the wages provided for 
                        similar positions in the sector involved for 
                        the service area; and
                            (ii) may be placements in new or vacant 
                        positions, but a participant in such a 
                        placement shall not displace any currently 
                        employed employee, consistent with section 
                        181(b) of the Workforce Investment Act of 1998 
                        (29 U.S.C. 2931(b)).

SEC. 128. MATCHING REQUIREMENT.

    (a) Requirement.--The Secretaries shall require that each eligible 
entity receiving a grant under section 123 contribute, toward the cost 
of the project for which the grant was awarded, matching funds in an 
amount equal to not less than 50 percent of the amount of the grant. 
The eligible entity may contribute such matching funds from non-Federal 
sources or Federal sources (other than this subtitle), in cash or in-
kind, fairly evaluated (including plant, equipment, or services).
    (b) Waiver or Reduction.--The Secretary may waive or reduce the 
matching requirement described in subsection (a) for an eligible entity 
if the eligible entity demonstrates a need due to significant financial 
hardship.

SEC. 129. FUNDING.

    There shall be made available from the Rebuild America Trust Fund 
under section 9512 of the Internal Revenue Code of 1986, $5,000,000,000 
for each of fiscal years 2013 through 2022 to carry out this subtitle.

                 Subtitle D--Supporting Great Teachers

SEC. 131. SHORT TITLE.

    This subtitle may be cited as the ``College and Career Ready 
Classrooms Act''.

SEC. 132. FINDINGS.

    Congress finds the following:
            (1) According to the Department of Labor, almost 90 percent 
        of new jobs in occupations with both high growth and high wages 
        require at least some postsecondary training. The majority of 
        new jobs that offer a wage sufficient to support a family and 
        provide opportunity for career advancement require some 
        postsecondary education. Moreover, research shows that the 
        skill level required to enter college or a work-training 
        program is the same.
            (2) Implementing college- and career-ready State standards 
        is a complex undertaking, requiring that teachers utilize a 
        wide array of knowledge and skills.
            (3) Peer learning among small groups of teachers is one of 
        the most powerful predictors of improved student academic 
        achievement. Students achieve more in mathematics and reading 
        when they attend schools characterized by high levels of 
        teacher collaboration for school improvement.
            (4) Other nations that outperform the United States on 
        international assessments invest more heavily in professional 
        development for teachers and build time for ongoing, sustained 
        collaboration and professional development into the school day 
        and year. Teachers in the United States spend about 80 percent 
        of their working time engaged in classroom instruction compared 
        to teachers in other countries where 60 percent of their time 
        is spent in classroom instruction.

SEC. 133. PURPOSES.

    The purposes of this subtitle are to--
            (1) support the successful implementation of college- and 
        career-ready State academic standards; and
            (2) strengthen the capacity of States and local educational 
        agencies to provide professional development that increases the 
        effectiveness of all teachers in the instruction of college- 
        and career-ready State standards and the development and use of 
        curriculum and assessments that are aligned with college- and 
        career-ready State standards.

SEC. 134. DEFINITIONS.

    In this subtitle:
            (1) ESEA definitions.--Unless otherwise specified, the 
        terms used in this subtitle have the meanings given the terms 
        in section 9101 of the Elementary and Secondary Education Act 
        of 1965 (20 U.S.C. 7801).
            (2) College- and career-ready professional development 
        leadership team.--The term ``college- and career-ready 
        professional development leadership team'' means a group of 
        educators, teacher association representatives, leaders, and 
        specialists convened by an eligible entity pursuant to section 
        136(b)(1)(C).
            (3) College- and career-ready staff network.--The term 
        ``college- and career-ready staff network'' means a group of 
        specialists, convened by a local entity, including school-based 
        teachers and leaders, teacher association representatives, and 
        specialists in relevant content areas, in teaching English 
        learners, and in teaching children with disabilities, who are 
        serving as mentors, coaches, or facilitators and who are 
        responsible for--
                    (A) establishing professional development goals;
                    (B) aligning the instructional work for individual 
                schools;
                    (C) supporting the implementation of inquiry-based 
                models of professional development;
                    (D) identifying and sharing best practices;
                    (E) coordinating with the college- and career-ready 
                professional development leadership team; and
                    (F) building and sustaining professional 
                development capacity within the local entity.
            (4) Eligible entity.--The term ``eligible entity'' means a 
        State educational agency or a consortium of State educational 
        agencies that has adopted standards in mathematics and English 
        language arts that are aligned with college and career 
        readiness, as demonstrated to the Secretary.
            (5) Local entity.--The term ``local entity'' means a local 
        educational agency or a consortium of local educational 
        agencies.

SEC. 135. GRANTS AUTHORIZED.

    (a) In General.--The Secretary is authorized to award grants on a 
competitive basis to eligible entities for the development, 
implementation, and monitoring of comprehensive, statewide professional 
development that--
            (1) is aligned with local professional development efforts; 
        and
            (2) increases the effectiveness of all teachers in the--
                    (A) instruction of college- and career-ready State 
                standards; and
                    (B) development and use of curriculum and 
                assessments and other instructional supports that are 
                aligned with college- and career-ready State standards.
    (b) Duration.--Each grant awarded under subsection (a)--
            (1) shall be for a minimum of a 3-year period and a maximum 
        of a 5-year period; and
            (2) may be renewed based on performance, as determined by 
        the Secretary.
    (c) Grant Amount.--The Secretary shall ensure that grants are of 
sufficient size and scope to enable grantees to carry out grant 
activities.
    (d) Geographic Distribution.--The Secretary shall ensure that 
grantees represent different geographic regions of the United States, 
including urban and rural areas.
    (e) Reservation of Funds.--From the amount made available under 
section 142 for a fiscal year, the Secretary shall reserve not more 
than 5 percent for the evaluation of activities implemented pursuant to 
grants awarded under subsection (a) and the dissemination of 
information on effective professional development activities, 
curriculum, assessments, and other instructional supports developed 
with such grant funds.

SEC. 136. APPLICATION.

    (a) In General.--An eligible entity that desires to receive a grant 
under section 135 shall submit an application to the Secretary at such 
time, in such manner, and containing such information as the Secretary 
may reasonably require.
    (b) Contents.--
            (1) In general.--Each application submitted under 
        subsection (a) shall include a comprehensive strategy for 
        implementing professional development aligned to college- and 
        career-ready State standards and related instructional supports 
        that shall include--
                    (A) a description of how the professional 
                development will increase teacher, principal, and other 
                school leader knowledge and understanding of college- 
                and career-ready State standards that is 
                differentiated, including by grade level and subject 
                area, specific to the teacher;
                    (B) a description of how the professional 
                development will increase teacher expertise beyond 
                basic content knowledge for subject-area teachers;
                    (C) the creation of a college- and career-ready 
                professional development leadership team responsible 
                for establishing statewide goals, providing model 
                frameworks to local college- and career-ready staff 
                networks, leaders, or specialists, for meeting 
                statewide goals, identifying and sharing best practices 
                around the implementation of college- and career-ready 
                State standards, curriculum alignment, and assessments, 
                and supporting local comprehensive college- and career-
                ready professional development strategy activities;
                    (D) dissemination to local college- and career-
                ready staff networks in an easily accessible format 
                that may include the use of technology, such as a web-
                based statewide instructional performance support 
                system, exemplary professional development activities, 
                opportunities to participate in professional learning 
                networks, technical assistance, and other professional 
                development resources designed to support the 
                successful implementation of college- and career-ready 
                State standards;
                    (E) a description of how the professional 
                development will be developed in collaboration with 
                nonprofit organizations, which may include institutions 
                of higher education, with a demonstrated record of 
                expertise, and other education stakeholders; and
                    (F) a description of how the professional 
                development will be based on an analysis of data and 
                evidence that indicates the needs of leaders, teachers, 
                and students.
            (2) Development of strategy.--The comprehensive strategy 
        described in paragraph (1) shall be developed in collaboration 
        with the representative organizations for teachers in the 
        State.

SEC. 137. STATE USE OF GRANT FUNDS.

    An eligible entity that receives a grant under section 135 shall 
carry out the following:
            (1) Professional development implementation activities.--
                    (A) Impact on teaching practice and student 
                achievement.--
                            (i) In general.--The eligible entity shall 
                        reserve not less than 2 percent of the grant 
                        funds--
                                    (I) to conduct an evaluation by a 
                                knowledgeable, skilled, and impartial 
                                evaluator of the impact of the 
                                comprehensive college- and career-ready 
                                professional development strategy on 
                                teaching practice and student 
                                achievement; and
                                    (II) to inform continuous 
                                improvement of professional development 
                                activities and, if applicable, 
                                redirecting professional development 
                                resources towards those activities that 
                                are most beneficial to teachers and 
                                students.
                            (ii) Conduct of evaluation and informing 
                        improvement.--The activities described in 
                        subclauses (I) and (II) of clause (i) shall be 
                        conducted by an entity other than the State 
                        educational agency.
                    (B) Strategy activities.--
                            (i) In general.--Except as provided in 
                        clause (ii), the eligible entity shall reserve 
                        not more than 13 percent of the grant funds to 
                        carry out the comprehensive college- and 
                        career-ready professional development 
                        activities described under section 136.
                            (ii) Exception for small or rural states.--
                        The Secretary may allow a small or rural State, 
                        upon application by such State, to reserve more 
                        than 13 percent of the grant funds to carry out 
                        the comprehensive college- and career-ready 
                        professional development activities described 
                        under section 136, and activities described 
                        under section 138(c)(4) as the activities apply 
                        to the State, if the State demonstrates to the 
                        Secretary that it would be more efficient and 
                        effective for the State to carry out such 
                        activities rather than local entities.
                    (C) Implementation activities.--From the amount 
                reserved under subparagraph (B), the eligible entity 
                may implement activities described under section 
                138(c)(4) as the activities apply to the State 
                educational agency.
            (2) Subgrants.--The eligible entity shall reserve not less 
        than 85 percent of the grant funds to award subgrants to local 
        entities under section 138.

SEC. 138. SUBGRANTS TO LOCAL ENTITIES.

    (a) Authorization.--
            (1) In general.--An eligible entity that receives a grant 
        under section 135 shall award subgrants, on a competitive 
        basis, to local entities.
            (2) Application.--A local entity that desires to receive a 
        subgrant under this section shall submit an application to the 
        eligible entity at such time, in such manner, and containing 
        such information as the eligible entity may reasonably require.
            (3) Contents of application.--
                    (A) Local comprehensive college- and career-ready 
                professional development implementation.--Each 
                application submitted under paragraph (2) shall include 
                a comprehensive strategy for implementing professional 
                development aligned to college- and career-ready State 
                standards and related instructional supports at the 
                local level (referred to in this subtitle as the 
                ``local strategy'') that will improve teacher practice 
                and increase student learning. Such local strategy 
                shall include--
                            (i) a description of how the local strategy 
                        was developed in consultation with the 
                        exclusive representative organization for 
                        teachers in the school district or, where there 
                        is no exclusive representative, teachers who 
                        shall be selected by teachers in the school 
                        district pursuant to a fair and democratic 
                        election process open to all teachers in the 
                        school district, principals, and other school 
                        leaders, and teacher-educators;
                            (ii) the clear learning goals to be 
                        achieved under the local strategy based on 
                        student, teacher, and leader learning needs and 
                        how they are aligned with the State goals 
                        established in the comprehensive college- and 
                        career-ready professional development strategy 
                        described under section 136;
                            (iii) a description of the tools that will 
                        be developed under the local strategy to enable 
                        teachers to easily access college- and career-
                        ready professional development materials and 
                        related resources, including model lesson plans 
                        and assessments, and other professional 
                        development materials relevant to teacher 
                        practice;
                            (iv) a description of how the professional 
                        development provided with funds under this 
                        section will--
                                    (I) be delivered in a format that 
                                is job-embedded, ongoing, sustained, 
                                and collaborative;
                                    (II) foster individual and 
                                collective responsibility for improving 
                                teacher effectiveness and student 
                                academic achievement and provide 
                                ongoing opportunities for teachers to 
                                assess the impact of teaching 
                                strategies on student learning and 
                                reflect on practice; and
                                    (III) support the use of technology 
                                to personalize instruction and use 
                                technology for professional 
                                development, consistent with subsection 
                                (c)(3);
                            (v) a description of how the professional 
                        development provided with funds under this 
                        section will strengthen the ability of teachers 
                        to analyze student data, including through the 
                        use of a statewide longitudinal data system, if 
                        available, to adjust teaching strategies in a 
                        timely and effective manner and improve 
                        practice; and
                            (vi) a description of how external 
                        partners, including content area experts, 
                        nonprofit organizations (including institutions 
                        of higher education), and teacher preparation 
                        programs, will be included in the 
                        implementation of the local strategy.
                    (B) Assurance.--Each application submitted under 
                paragraph (2) shall include an assurance that--
                            (i) a minimum of 50 hours of relevant and 
                        high-quality professional development per 
                        school year will be provided to each teacher 
                        responsible for implementing, or assisting in 
                        the implementation of, college- and career-
                        ready State standards, including opportunities 
                        for ongoing, job-embedded collaboration and 
                        participation in peer observations; and
                            (ii) participating local educational 
                        agencies and schools, in collaboration with the 
                        exclusive representative organization for 
                        teachers in the school district or, where there 
                        is no exclusive representative, teachers who 
                        shall be selected by teachers in the school 
                        district pursuant to a fair and democratic 
                        election process open to all teachers in the 
                        school district, will negotiate or agree to 
                        restructure or extend the length of the school 
                        day, week, or year, to accommodate additional 
                        professional development hours in a manner that 
                        meets the requirements of this subtitle over 
                        the course of the school year.
    (b) Priority.--In awarding subgrants under this section, an 
eligible entity shall give priority to local entities--
            (1) that serves not fewer than 10,000 children as described 
        in section 1124(c)(1)(A) of the Elementary and Secondary 
        Education Act of 1965 (20 U.S.C. 6333(c)(1)(A));
            (2) for which not less than 20 percent of the children 
        served by the local entity are children as described in section 
        1124(c)(1)(A) of the Elementary and Secondary Education Act of 
        1965 (20 U.S.C. 6333(c)(1)(A));
            (3) that meets the eligibility requirements for funding 
        under the Small, Rural School Achievement Program under section 
        6211(b) of the Elementary and Secondary Education Act of 1965 
        (20 U.S.C. 7345(b)); or
            (4) that meets the eligibility requirements for funding 
        under the Rural and Low-Income School Program under section 
        6221(b) of the Elementary and Secondary Education Act of 1965 
        (20 U.S.C. 7351(b)).
    (c) Local Use of Funds.--A local entity awarded a subgrant under 
this section shall use the subgrant funds to implement, in consultation 
with teachers or other representative organizations selected or 
identified to represent the teachers, a local strategy, which shall 
include--
            (1) assisting local educational agencies in implementing 
        college- and career-ready standards, specifically in the areas 
        of increasing content area expertise, curriculum development 
        and alignment, and assessment practices;
            (2) creating and supporting a college- and career-ready 
        staff network;
            (3) providing, to the extent practicable, a hybrid model 
        for professional learning that combines technology-based and 
        in-person professional learning experiences and support, such 
        as the use of a web-based local, regional, or statewide 
        instructional performance support system that includes 
        exemplary professional development activities, opportunities to 
        participate in professional learning networks, training 
        programs, technical assistance, and other professional 
        development resources designed to support the successful 
        implementation of college- and career-ready standards;
            (4) providing frequent and sustained opportunities for 
        teachers to develop, implement, and assess--
                    (A) strategies for aligning the curriculum with 
                college- and career-ready standards, including lesson 
                planning and instructional strategies that reflect the 
                rigor of the standards;
                    (B) instructional strategies, such as 
                interdisciplinary or project-based learning approaches, 
                that enhance students' ability to think critically, 
                problem-solve, complete complex tasks, conduct research 
                and inquiry, communicate and demonstrate skills, and 
                think independently;
                    (C) instructional strategies and assessments that 
                meet the needs of English learners and children with 
                disabilities; and
                    (D) formative students assessments and other 
                student assessments that measure student mastery of the 
                relevant college- and career-ready State standards;
            (5) providing in-service activities for school principals 
        and other school administrators that support instructional 
        leadership around the implementation of college- and career-
        ready standards;
            (6) changing the structure and length of the school day, 
        week, or year, to allow for additional time for teacher 
        collaboration, planning, and observation;
            (7) coordinating or sharing information with pre-service 
        teacher preparation programs to support the successful 
        implementation of college- and career-ready State standards; 
        and
            (8) developing tools to assist teachers in evaluating 
        student work.
    (d) Evaluation.--
            (1) In general.--Each local entity that receives a subgrant 
        under this section shall reserve not less than 5 percent of the 
        subgrant funds to--
                    (A) conduct an evaluation of the impact of the 
                local strategy on teaching practice and student growth 
                and learning; and
                    (B) inform continuous improvement of professional 
                development activities.
            (2) Conduct of evaluation and informing improvement.--The 
        activities described in subparagraphs (A) and (B) of paragraph 
        (1) shall be conducted by an entity other than the local 
        entity.

SEC. 139. REPORTING.

    (a) State Reporting.--Each eligible entity that receives a grant 
under section 135 shall annually, for each year of the grant, submit to 
the Secretary and make available to the public a report that shall 
include--
            (1) information on the number of local educational 
        agencies, schools, and teachers that received professional 
        development supported with grant funds under section 135;
            (2) the professional development activities funded under 
        this subtitle; and
            (3) a description of the impact of the comprehensive 
        college- and career-ready professional development strategy, 
        including results from the evaluation conducted under section 
        137(1)(A)(i)(I).
    (b) Report to Congress.--The Secretary shall annually submit to 
Congress and make available to the public a summary of the eligible 
entity reports required under subsection (a).
    (c) Local Reporting.--Each local entity that receives a subgrant 
under section 138 shall annually, for each year of the subgrant, submit 
to the eligible entity and make available to the public a report that 
shall include--
            (1) information on the number of local educational 
        agencies, schools, and teachers that received professional 
        development supported with subgrant funds under section 138;
            (2) the professional development activities funded under 
        section 138; and
            (3) a description of the impact of the local strategy, 
        including results from the evaluation conducted under section 
        138(d).

SEC. 140. TEACHER PRIVACY.

    No State or local educational agency shall be required to publicly 
report information in compliance with this subtitle in a case in which 
the results would reveal personally identifiable information about an 
individual teacher.

SEC. 141. RULE OF CONSTRUCTION.

    Nothing in this section shall be construed to alter or otherwise 
affect the rights, remedies, and procedures afforded school or school 
district employees under Federal, State, or local laws (including 
applicable regulations or court orders) or under the terms of 
collective bargaining agreements, memoranda of understanding, or other 
agreements between such employees and their employers.

SEC. 142. FUNDING.

    There shall be made available from the Rebuild America Trust Fund 
under section 9512 of the Internal Revenue Code of 1986, $2,000,000,000 
for each of the fiscal years 2013 through 2017, to carry out this 
subtitle.

                 Subtitle E--Creating Middle Class Jobs

                     PART I--TEACHER STABILIZATION

SEC. 151. PURPOSE.

    The purpose of this part is to provide funds to States to prevent 
teacher layoffs in public schools and support the creation of 
additional jobs in public early childhood education and care programs 
and public elementary and secondary education in the 2012-2013, 2013-
2014, and 2014-2015 school years.

SEC. 152. DEFINITIONS.

            (1) ESEA definitions.--Except as otherwise provided, the 
        terms ``local educational agency'', ``outlying area'', 
        ``Secretary'', and ``State educational agency'' have the 
        meanings given those terms in section 9101 of the Elementary 
        and Secondary Education Act of 1965 (20 U.S.C. 7801).
            (2) Early childhood educator.--The term ``early childhood 
        educator'' means an individual who--
                    (A) works directly with children in a State or 
                local funded early childhood education and care program 
                in a low-income community; and
                    (B) in the course of such employment, is involved 
                directly in the care, development, and education of 
                infants, toddlers, or children ages 5 and under.
            (3) State.--The term ``State'' means each of the 50 States, 
        the District of Columbia, and the Commonwealth of Puerto Rico.
            (4) State funded early childhood program.--The term ``State 
        funded early childhood program'' means a program that provides 
        educational services to children from ages birth through 
        kindergarten entry and receives funding from a State.
            (5) State or local funded early childhood program.--The 
        term ``State or local funded early childhood program'' means a 
        program that provides educational services to children from 
        ages birth through kindergarten entry and receives funding from 
        a State or local government.

SEC. 153. RESERVATIONS FOR THE OUTLYING AREAS AND THE SECRETARY OF THE 
              INTERIOR.

    From the amount appropriated to carry out this part under section 
159 for each fiscal year, the Secretary--
            (1) shall reserve 0.5 percent to provide assistance to the 
        outlying areas on the basis of their respective needs, as 
        determined by the Secretary, for activities consistent with 
        this part and under such terms and conditions as the Secretary 
        may determine; and
            (2) shall reserve 0.5 percent to provide assistance to the 
        Secretary of the Interior to carry out activities consistent 
        with this part in schools operated or funded by the Bureau of 
        Indian Education.

SEC. 154. STATE ALLOTMENTS.

    (a) In General.--From the amounts appropriated to carry out this 
part for a fiscal year that remain after the reservations under section 
153, the Secretary shall allot to each State--
            (1) an amount that bears the same relation to 60 percent of 
        such remaining funds as the State's population of individuals 
        aged 5 through 17 bears to the total population of individuals 
        aged 5 through 17 in all States; and
            (2) an amount that bears the same relation to 40 percent on 
        such remaining funds as the State's population bears to the 
        total population of all States.
    (b) Awards to States.--In order for a State to receive an allotment 
under subsection (a), the Governor of the State shall submit an 
approvable application under section 155(a).
    (c) Reallotment.--If a State does not apply for funding under this 
part or only uses a portion of its allotment, the Secretary shall 
reallot the State's entire allotment or the remaining portion of its 
allotment, as the case may be, to the remaining States in accordance 
with subsection (a).

SEC. 155. STATE APPLICATION, RESERVATION, AND RESPONSIBILITIES.

    (a) Application.--The Governor of a State desiring to receive a 
grant under this part shall submit an application to the Secretary not 
later than 30 days after the date of enactment of this Act, in such 
manner, and containing such information as the Secretary may reasonably 
require to determine the State's compliance with applicable provisions 
of law.
    (b) State Reservations, Allocations, and Responsibilities.--
            (1) Reservation.--Each State receiving an allotment under 
        this part may reserve, for each fiscal year--
                    (A) not more than 2 percent of the grant funds for 
                the administrative costs of carrying out the State's 
                responsibilities under this part; and
                    (B) not more than 10 percent of the grant funds to 
                award subgrants to State funded early childhood care 
                and education programs to enable the programs to carry 
                out the activities described in section 156(b).
            (2) Allocations to local educational agencies.--From 
        amounts remaining after reserving funds under paragraph (1), 
        each State receiving an allotment under this part for a fiscal 
        year shall use such remaining funds only for awarding subgrants 
        to local educational agencies in the State for the support of 
        high-quality early childhood education and care programs and 
        elementary and secondary education by allocating to each local 
        educational agency--
                    (A) an amount that bears the same relation to 35 
                percent of such remaining funds as the number of 
                students enrolled in the schools served by the local 
                educational agency bears to the number of students 
                enrolled in the schools served by all local educational 
                agencies in the State; and
                    (B) an amount that bears the same relation to 65 
                percent of such remaining funds as the number of 
                individuals age 5 through 17 from families below the 
                poverty line in the geographic area served by the local 
                educational agency, as determined by the Secretary on 
                the basis of the most recent satisfactory data, bears 
                to the total number of those individuals in the 
                geographic area served by all local educational 
                agencies in the State, as so determined.
            (3) Timing.--Each State receiving an allotment under this 
        part for a fiscal year shall make the subgrants described in 
        paragraphs (1)(B) and (2) available to the subgrantees not 
        later than 100 days after receiving the allotment from the 
        Secretary.
            (4) Prohibitions.--A State shall not use funds received 
        under this part to directly or indirectly--
                    (A) establish, restore, or supplement a rainy-day 
                fund;
                    (B) supplant State funds in a manner that has the 
                effect of establishing, restoring, or supplementing a 
                rainy-day fund;
                    (C) reduce or retire debt obligations incurred by 
                the State; or
                    (D) supplant State funds in a manner that has the 
                effect of reducing or retiring debt obligations 
                incurred by the State.

SEC. 156. SUBGRANTS.

    (a) Local Educational Agency Responsibilities.--Each local 
educational agency that receives a subgrant under this part shall--
            (1) use the subgrant funds only for compensation and 
        benefits and other expenses, such as support services, 
        necessary to retain existing employees, recall or rehire former 
        employees, or hire new employees to provide high-quality early 
        childhood education and care, elementary or secondary 
        education, or related services;
            (2) obligate such funds not later than September 30 of the 
        fiscal year for which the funds are received; and
            (3) not use such funds for general administrative expenses 
        or for other support services or expenditures, as those terms 
        are defined by the National Center for Education Statistics in 
        the Common Core of Data as of the date of enactment of this 
        Act.
    (b) Early Childhood Education and Care Program Responsibilities.--
Each State or local funded early childhood education and care program 
that receives a subgrant under this part shall--
            (1) use the subgrant funds only for compensation, benefits, 
        and other expenses, such as support services, necessary to 
        retain early childhood educators, recall or rehire former early 
        childhood educators, or hire new early childhood educators to 
        provide high-quality early childhood education and care 
        services; and
            (2) obligate such funds not later than September 30 of the 
        fiscal year for which the funds are received.

SEC. 157. MAINTENANCE OF EFFORT.

    (a) In General.--The Secretary shall not award an allotment to a 
State under this part unless the State provides an assurance to the 
Secretary that, for each fiscal year of the grant, the State will 
maintain State support for early childhood education and care, 
elementary, and secondary education programs and services (in the 
aggregate or on the basis of expenditure per pupil) and for public 
institutions of higher education (not including support for capital 
projects or for research and development or tuition and fees paid by 
students) at not less than the level of such support for each of the 2 
categories for the State fiscal year preceding the year for which the 
determination is being made.
    (b) Supplement Not Supplant.--A State educational agency or local 
educational agency shall use Federal funds received under this part 
only to supplement the funds that would, in the absence of such Federal 
funds, be made available from non-Federal sources for the education of 
pupils participating in programs assisted under this part, and not to 
supplant such funds.
    (c) Waiver.--The Secretary may waive the requirements of this 
section if the Secretary determines that a waiver would be equitable 
due to--
            (1) exceptional or uncontrollable circumstances, such as a 
        natural disaster; or
            (2) a precipitous decline in the financial resources of the 
        State.

SEC. 158. REPORTING.

    Each State that receives an allotment under this part shall submit, 
on an annual basis, a report to the Secretary that contains--
            (1) a description of how funds received under this part 
        were expended or obligated; and
            (2) an estimate of the number of jobs supported by the 
        State using funds received under this part.

SEC. 159. FUNDING.

    (a) In General.--There shall be made available from the Rebuild 
America Trust Fund under section 9512 of the Internal Revenue Code of 
1986, the following amounts to carry out this part:
            (1) For fiscal year 2013, $30,000,000,000.
            (2) For fiscal year 2014, $20,000,000,000.
            (3) For fiscal year 2015, $10,000,000,000.
    (b) Availability of Funds.--Funds made available under subsection 
(a) shall remain available to the Secretary until September 30, 2015.

                 PART II--FIRST RESPONDER STABILIZATION

SEC. 161. PURPOSE.

    The purpose of this part is to provide funds to States and 
localities to prevent layoffs of, and support the creation of 
additional jobs for, law enforcement officers and other first 
responders.

SEC. 162. CAREER LAW ENFORCEMENT OFFICERS GRANT PROGRAM.

    (a) In General.--The Attorney General shall make competitive grants 
under section 1701 of title I of the Omnibus Crime Control and Safe 
Streets Act of 1968 (42 U.S.C. 3796dd) for the hiring, rehiring, or 
retention of career law enforcement officers under part Q of such 
title.
    (b) Applicability of Grant Requirements.--Grants awarded under 
subsection (a) shall not be subject to--
            (1) subsection (g) or (i) of section 1701 of title I of the 
        Omnibus Crime Control and Safe Streets Act of 1968 (42 U.S.C. 
        3796dd); or
            (2) section 1704 of such Act (42 U.S.C. 3796dd-3).
    (c) Funding.--
            (1) In general.--There shall be made available from the 
        Rebuild America Trust Fund under section 9512 of the Internal 
        Revenue Code of 1986, the following amounts to the Community 
        Oriented Policing Stabilization Fund to enable the Attorney 
        General to carry out the competitive grant program under this 
        section:
                    (A) $4,000,000,000 for fiscal year 2013.
                    (B) $2,400,000,000 for fiscal year 2014.
                    (C) $800,000,000 for fiscal year 2015.
            (2) Limitation.--Of the amounts made available pursuant to 
        paragraph (1), not to exceed $8,000,000 shall be for 
        administrative costs of the Attorney General.

SEC. 163. FIRST RESPONDER GRANT PROGRAM.

    (a) In General.--There shall be made available from the Rebuild 
America Trust Fund under section 9512 of the Internal Revenue Code of 
1986, the following amounts to the Secretary of Homeland Security to 
award grants under section 34 of the Federal Fire Prevention and 
Control Act of 1974 (15 U.S.C. 2229a):
            (1) $1,000,000,000 for fiscal year 2013.
            (2) $600,000,000 for fiscal year 2014.
            (3) $200,000,000 for fiscal year 2015.
    (b) Limitation.--Of the amounts made available pursuant to 
subsection (a), not to exceed $2,000,000 shall be for administrative 
costs of the Secretary of Homeland Security.
    (c) Waivers.--In making grants with amounts made available under 
subsection (a), the Secretary may grant waivers from the requirements 
in subsections (a)(1)(A), (a)(1)(B), (a)(1)(E), (c)(1), (c)(2), and 
(c)(4)(A) of section 34 of the Federal Fire Prevention and Control Act 
of 1974.

           PART III--MAINTAINING CRITICAL COMMUNITY SERVICES

SEC. 171. DEFINITIONS.

    In this part:
            (1) Benefits.--The term ``benefits'' has the meaning given 
        the term ``employment benefits'' in section 101 of the Family 
        and Medical Leave Act of 1993 (29 U.S.C. 2611).
            (2) Employee compensation.--The term ``employee 
        compensation'' includes wages and benefits.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of Labor.
            (4) State.--The term ``State'' means any State of the 
        United States and the Commonwealth of Puerto Rico.
            (5) Unit of general local government.--The term ``unit of 
        general local government'' means--
                    (A) any city, county, town, township, parish, 
                village, or other general purpose political subdivision 
                of a State;
                    (B) Guam, the Northern Mariana Islands, the Virgin 
                Islands, and American Samoa, or a general purpose 
                political subdivision thereof;
                    (C) a combination of such political subdivisions 
                that is recognized by the Secretary; or
                    (D) the District of Columbia.
            (6) Wage.--The term ``wage'' has the meaning given such 
        term in section 3 of the Fair Labor Standards Act of 1938 (29 
        U.S.C. 203).

SEC. 172. MAINTAINING CRITICAL COMMUNITY SERVICES.

    (a) Program Authorized.--From the amount made available for this 
part under section 178 and not reserved under subsection (b), the 
Secretary of Labor, acting through the Employment and Training 
Administration and in consultation with the Secretary of Housing and 
Urban Development, shall award grants, on a competitive basis in 
accordance with section 174, to units of general local government to 
save and create local jobs through the retention, restoration, or 
expansion of critical services needed by local communities.
    (b) Reservations by the Secretary.--Of the amount made available 
for this part under section 178 for each fiscal year, the Secretary may 
reserve not more than 1 percent to administer this part.

SEC. 173. APPLICATION.

    (a) Application.--In order to receive funds under this part for a 
fiscal year, a unit of general local government shall submit to the 
Secretary, at such time and in such manner as determined by the 
Secretary, an application that includes the information described in 
subsection (b) for such fiscal year.
    (b) Contents.--An application submitted under subsection (a) shall 
include the following information:
            (1) A certification by the unit of general local government 
        of--
                    (A) the amount of funds requested by the unit of 
                general local government;
                    (B) the number of individuals who will receive 
                employee compensation with such funds; and
                    (C) whether the positions supported with funds 
                under this part will assist in retaining, restoring, or 
                expanding an existing local public service.
            (2) A statement documenting the need for the critical 
        services to be carried out by the individuals hired for the 
        positions.
            (3) In the case of a unit of general local government that 
        desires to use funds received under this part to continue to 
        provide employee compensation for existing employees of the 
        unit, a statement documenting the fiscal constraints of the 
        unit that would result in the termination or reduction of the 
        positions of such employees.
            (4) An assurance by the unit of general local government 
        that the unit will comply with all provisions of this part and 
        with all applicable Federal, State, and local labor laws, 
        including laws concerning wages and hours, labor relations, 
        family and medical leave, occupational safety and health, and 
        nondiscrimination.
            (5) Such additional information as the Secretary determines 
        necessary, including information regarding the criteria 
        described in section 174(a).

SEC. 174. AWARD BASIS.

    (a) Criteria.--Subject to subsection (b), the Secretary shall award 
grants under this part by taking into consideration--
            (1) the unemployment rate in the local community served by 
        the unit of general local government;
            (2) the poverty rate in such local community;
            (3) the population of such local community;
            (4) excess unemployment in such local community; and
            (5) other factors as the Secretary determines necessary.
    (b) Maximum Amount.--
            (1) In general.--In no case shall the ratio of the amount 
        of grant funds awarded under this part to all units of general 
        local government in the State, as compared to the total amount 
        of grant funds available under this part, be greater than the 
        ratio of the State's population, as compared to the total 
        population of all States and all areas described in paragraph 
        (2).
            (2) Application to territories and the district of 
        columbia.--For the areas of Guam, the Northern Mariana Islands, 
        the Virgin Islands, American Samoa, and the District of 
        Columbia, in no case shall the ratio of the amount of grant 
        funds awarded to any such area, as compared to the total amount 
        of grant funds available under this part, be greater than the 
        ratio of the population of such area as compared to the total 
        population of all States and all such areas.
    (c) Timing.--For each fiscal year, the Secretary shall award the 
grants under this part by not later than 30 days after the end of the 
application period.

SEC. 175. USES OF FUNDS.

    (a) In General.--A unit of general local government that receives a 
grant under this part--
            (1) shall use the funds to provide employee compensation to 
        retain or hire individuals to continue, restore, or expand 
        public services; and
            (2) may not use more than 5 percent for administrative 
        purposes under the grant.
    (b) Nondisplacement.--A unit of general local government may not 
employ an individual for a position funded under this part, if--
            (1) employing such individual will result in the layoff or 
        partial displacement (such as a reduction in hours, wages, or 
        employee benefits) of an existing employee of the unit of 
        general local government; or
            (2) such individual will perform the same or substantially 
        similar work that had previously been performed by an employee 
        of the unit who--
                    (A) has been laid off or partially displaced (as 
                such term is described in paragraph (1)); and
                    (B) has not been offered, by the unit or 
                organization, to be restored to the position the 
                employee had immediately prior to being laid off or 
                partially displaced.

SEC. 176. EMPLOYEE STATUS, COMPLIANCE WITH LOCAL LAWS, AND CONTRACTS.

    (a) Employee Status.--An individual hired for a position funded 
under this part shall be considered an employee of the unit of general 
local government by which such individual was hired and receive the 
same employee compensation, have the same rights and responsibilities 
and job classifications, and be subject to the same job standards, 
employer policies, and collective bargaining agreements as if such 
individual was hired without assistance under this part.
    (b) Compliance With Local Laws and Contracts.--In hiring 
individuals for positions funded under this part, or using funds under 
this part to continue to provide employee compensation for existing 
employees, a unit of general local government shall comply with all 
applicable Federal, State, and local laws, personnel policies and 
regulations, and collective bargaining agreements, as if such 
individual was hired, or such employee compensation was provided, 
without assistance under this part.

SEC. 177. SUPPLEMENT, NOT SUPPLANT.

    Funds made available under this part shall be used to supplement, 
and not supplant, other Federal, State, and local funds that would 
otherwise be expended to carry out activities under this part.

SEC. 178. FUNDING PROVIDED.

    There shall be made available from the Rebuild America Trust Fund 
under section 9512 of the Internal Revenue Code of 1986, the following 
amounts to enable the Secretary of Labor to carry out the purposes of 
this part:
            (1) $5,000,000,000 for fiscal year 2013.
            (2) $5,000,000,000 for fiscal year 2014.

 TITLE II--CREATING FINANCIAL STABILITY AND A BETTER FUTURE FOR MIDDLE 
                             CLASS FAMILIES

          Subtitle A--Alleviating the High Cost of Child Care

SEC. 201. CCDBG PLUS.

    (a) Definitions.--In this section:
            (1) Eligible child.--The term ``eligible child'' means a 
        child who has not attained the age of 13 and whose family 
        income is equal to or less than the State median income for a 
        family of the same size.
            (2) Low-income.--The term ``low-income'', when used in 
        reference to an individual, means an individual with a family 
        income that is less than or equal to 200 percent of the poverty 
        line, as defined in section 673 of the Community Services Block 
        Grant Act (42 U.S.C. 9902), applicable to a family of the size 
        involved.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (4) State.--The term ``State'' means each of the 50 States, 
        the District of Columbia, and the Commonwealth of Puerto Rico.
    (b) Program Authorized.--
            (1) In general.--The Secretary of Health and Human Services 
        is authorized to award grants, in allotments described in 
        subsection (c)(2), to States to enable the States to increase 
        the availability of high-quality early childhood care and 
        education programs to enable more people of the United States 
        to enter into and advance within the middle class.
            (2) Duration of grant.--A grant awarded under this section 
        shall be for a period of not more than 5 years.
            (3) Contingent funding.--After the third year of the grant 
        period of a grant under this section, funding for each 
        additional year of the grant period shall be contingent on the 
        State's progress toward meeting the performance indicators and 
        benchmarks established under subsection (g).
            (4) Eligibility.--In order to receive an allotment under 
        this section, a State shall establish or certify, to the 
        satisfaction of the Secretary, that the State's payments for 
        the grant or contracts to provide early childhood care and 
        education programs under subsection (f)(1) are sufficient to 
        ensure that programs and providers that serve eligible children 
        from birth through age 5 can meet the standards established 
        under subsection (f)(2).
    (c) Amounts Reserved; Allotments.--
            (1) Reservations.--From the amounts appropriated to carry 
        out this section, the Secretary shall reserve--
                    (A) 2 percent of such amounts to make grants or 
                enter into contracts with Indian tribes or tribal 
                organizations (as such terms are defined in section 
                658P of the Child Care Development Block Grant Act of 
                1990 (42 U.S.C. 9858n)) for programs or activities 
                consistent with the purposes of this section; and
                    (B) 0.5 percent of such amounts to award grants to 
                Guam, American Samoa, the Virgin Islands of the United 
                States, and the Commonwealth of the Northern Mariana 
                Islands for programs or activities consistent with the 
                purposes of this section, to be allotted in accordance 
                with their respective needs.
            (2) Allotments.--From the amounts appropriated to carry out 
        this section and not reserved under paragraph (1), the 
        Secretary shall make allotments to each eligible State with an 
        approved application using the formula established under 
        section 658O(b) of the Child Care Development Block Grant Act 
        of 1990 (42 U.S.C. 9858m(b)), except that any calculation in 
        such formula that refers all States shall, for purposes of this 
        section, be calculated based on all eligible States that have 
        submitted an approved application.
    (d) Application.--
            (1) In general.--A State desiring a grant under this 
        section shall submit an application at such time, in such 
        manner, and containing such information as the Secretary may 
        require, including the following:
                    (A) A description of how, by not later than 3 years 
                after the date of receipt of the grant, the State will 
                ensure the health and safety of early childhood care 
                and education programs by inspecting and monitoring all 
                regulated child care providers in the State not less 
                than 2 times each year, in accordance with subsection 
                (e)(2).
                    (B) A description of the process the State proposes 
                to use to ensure that investments made to increase 
                access to programs providing high-quality early 
                childhood care and education programs are prioritized 
                first in local economic areas with significant 
                concentrations of poverty and unemployment that do not 
                have such programs.
                    (C) A description of the strategies the State will 
                employ to build on the capacity of State early 
                childhood care and education programs, and communities, 
                to promote parents' and families' understanding of the 
                State's early childhood care and education system and 
                the importance of high-quality early learning 
                opportunities.
                    (D) A description of the proposed timeframe to 
                develop and implement the elements of the grant program 
                described in the application.
                    (E) An assurance that the grant funds will only be 
                used to supplement, and not to supplant, Federal, 
                State, and local funds otherwise available to support 
                existing (as of the date of the application) early 
                childhood care and education programs described in 
                subsection (e)(3).
                    (F) A certification that the State will provide 
                assistance for the provision of early childhood care 
                and education programs under subsection (f), and 
                provides assistance for child care services under the 
                Child Care and Development Block Grant Act of 1990 (42 
                U.S.C. 9858 et seq.), for families by using a sliding 
                fee scale that provides for cost sharing by the 
                families, in order to prioritize increasing the number 
                and percentage of low-income and otherwise 
                disadvantaged children and families in high-quality 
                early childhood care and education programs described 
                in subsection (e)(3).
                    (G) An assurance that the State will periodically 
                revise the sliding fee scale used to provide assistance 
                under this section.
                    (H) A description of how the State will coordinate 
                the program supported under this section with the 
                program supported under the Child Care and Development 
                Block Grant Act of 1990 (42 U.S.C. 9858 et seq.), Head 
                Start and Early Head Start programs under the Head 
                Start Act (42 U.S.C. 9832), the 21st century community 
                learning center program under part B of title IV of the 
                Elementary and Secondary Education Act of 1965 (20 
                U.S.C. 7171 et seq.), part C and section 619 of the 
                Individuals with Disabilities Education Act (20 U.S.C. 
                1431 et seq.), and, as applicable, activities funded 
                under the Race to The Top-Early Learning Challenge 
                program under section 14006 of the American Recovery 
                and Reinvestment Act of 2009 (Public Law 111-5; 123 
                Stat. 283).
            (2) Consultation.--A State shall develop its application 
        under this subsection in consultation with the State Advisory 
        Council on Early Education and Care established pursuant to 
        section 642B(b)(1)(A) of the Head Start Act (42 U.S.C. 
        9837b(b)(1)(A)).
    (e) Use of Funds.--A State that receives a grant under this section 
shall use grant funds to carry out the following:
            (1) Reservation for enhancing child care quality.--The 
        State shall reserve 10 percent of the grant funds to support--
                    (A) activities that enhance the skills, knowledge, 
                credentials, and compensation of the child care 
                workforce, including in ways that support career 
                advancement through career ladders; and
                    (B) other activities to enhance child care quality 
                and support child care providers, including family 
                child care providers, in meeting the standards 
                described in subsection (f)(2).
            (2) Use for inspection and monitoring.--From the amount of 
        grant funds remaining after the reservation under paragraph 
        (1), the State shall use not less than 10 percent of funds to 
        ensure that the State inspects and monitors all State-regulated 
        child care providers, to include site visits not less 
        frequently than 2 times each year. At a minimum, 1 such visit 
        shall address health and safety and 1 visit shall address child 
        care quality, and at least 1 of the visits shall be 
        unannounced.
            (3) Use for subsidies for early childhood care and 
        education programs.--From the amount of grant funds remaining 
        after carrying out paragraphs (1) and (2), the State shall make 
        high-quality early childhood care and education programs more 
        affordable to families of eligible children by--
                    (A) using two-thirds of such remaining amounts to 
                provide assistance for the provision of high-quality 
                early childhood care and education programs under 
                subsection (f) for eligible children who are infants 
                and toddlers; and
                    (B) using the remaining funds to provide assistance 
                for eligible children who have not attained the age of 
                13 for the provision of high-quality early childhood 
                care and education programs (which, for purposes of 
                serving school-age children under this subparagraph, 
                shall be deemed to include high-quality after-school 
                programs) under subsection (f).
    (f) More Affordable Quality Child Care.--
            (1) In general.--To provide the assistance described in 
        subsection (e)(3), a State shall award grants or contracts to 
        eligible providers that allow parents of eligible children who 
        are provided assistance under this section to enroll such 
        children with the eligible providers in high-quality early 
        childhood care and education programs described in such 
        subsection.
            (2) Eligible providers.--
                    (A) In general.--In order for a provider that 
                serves eligible children from birth through age 5 to be 
                an eligible provider for purposes of this section, the 
                provider shall be a child care center, Head Start or 
                Early Head Start program, or family child care home or 
                system that--
                            (i) offers full-day, full-year care or 
                        before- or after-school care; and
                            (ii)(I) meets Head Start program 
                        performance standards, or standards established 
                        for the top tier of a State's quality rating 
                        and improvement system, as appropriate; or
                            (II) is accredited by a national early 
                        childhood body with demonstrated valid and 
                        reliable program standards of high quality.
                    (B) Special rule.--The Secretary may adjust the 
                requirements of subparagraph (A), to the extent the 
                Secretary determines necessary to carry out the 
                purposes of this section, for high-quality early 
                childhood care and education programs providing care to 
                eligible children during nontraditional hours.
            (3) Support for children with disabilities.--Not less than 
        15 percent of the funds described in each of subparagraphs (A) 
        and (B) of subsection (e)(3) shall be used to support high-
        quality early childhood care and education programs through 
        eligible providers for eligible children who are children with 
        disabilities, as defined in section 602 of the Individuals with 
        Disabilities Education Act (20 U.S.C. 1401), or infants or 
        toddlers with disabilities, as defined in section 632 of such 
        Act (20 U.S.C. 1432).
            (4) Support for quality care during nontraditional hours.--
        Not less than 10 percent of the funds described in each of 
        subparagraphs (A) and (B) of subsection (e)(3) shall be used to 
        support the provision of high-quality early childhood care and 
        education programs described in such subsection to eligible 
        children during nontraditional hours.
    (g) Accountability.--
            (1) In general.--The Secretary shall define, by regulation, 
        indicators to be used to measure success on the activities 
        carried out under a grant under this section, the primary 
        indicator of which shall be increasing the number and 
        percentage of low-income children in high-quality, State early 
        childhood care and education programs, as described in 
        subsection (e)(3).
            (2) Quantifiable benchmarks.--Each State receiving a grant 
        under this section shall--
                    (A) develop quantifiable benchmarks for the State 
                and the activities supported under the grant based on 
                indicators described in paragraph (1) that are 
                applicable to the State; and
                    (B) submit such benchmarks for approval to the 
                Secretary.
            (3) Disaggregation.--The indicators and benchmarks shall 
        include, at a minimum, indicators and benchmarks for all 
        eligible children served by the program and for the categories 
        of children described in paragraphs (2), (3), and (4) of 
        subsection (i).
    (h) Maintenance of Effort.--With respect to each period for which a 
State is awarded a grant under this section, the expenditures by the 
State on State early childhood care and education programs described in 
subsection (e)(3), and supports, shall not be less than the greater of 
the level of the expenditures for such programs and supports in the 
prior fiscal year or in the full fiscal year preceding the date of 
enactment of the Rebuilding America Act.
    (i) Reports.--Each State that receives a grant under this section 
shall submit to the Secretary an annual report, which the Secretary 
shall make publicly available, that includes information on the 
activities carried out by the State under this section for the year, 
including--
            (1) the number of eligible children, and families, that 
        were assisted under this section;
            (2) the number and percentage of low-income children 
        assisted;
            (3) the number and percentage of English learners assisted;
            (4) the number and percentage of children with disabilities 
        assisted; and
            (5) the number of early childhood care and education 
        programs, as described in subsection (e)(3) and disaggregated 
        by type, that received assistance under this section.
    (j) Funding.--There shall be made available from the Rebuild 
America Trust Fund under section 9512 of the Internal Revenue Code of 
1986, $5,000,000,000 for each of fiscal years 2013 through 2022 to 
carry out this section.
    (k) Sunset Provision.--The authority under this section shall 
expire on the date that is 10 years after the date of enactment of this 
Act.

         Subtitle B--Helping Americans Enjoy Their Golden Years

               PART I--COMMISSION ON RETIREMENT SECURITY

SEC. 211. SHORT TITLE.

    This part may be cited as the ``Retirement Security Act of 2012''.

SEC. 212. FINDINGS.

    Congress makes the following findings:
            (1) The United States is facing a retirement crisis. The 
        difference between what people need for retirement and what 
        they actually have is approximately $6,600,000,000,000.
            (2) Social Security is the bedrock of retirement security, 
        but Social Security must be supplemented by a strong and 
        vibrant private retirement system.
            (3) The private retirement system is not doing enough to 
        help families prepare for retirement. Only \1/2\ of the 
        workforce has access to an employer provided retirement plan, 
        and the number of workers covered by defined benefit pension 
        plans has fallen from 50 percent to 20 percent in just 30 
        years. Consequently, retirement is getting less and less secure 
        for middle class families.
            (4) In order to address the retirement crisis, the United 
        States needs a retirement system that embodies the following 
        principles:
                    (A) The private retirement system must be universal 
                and automatic.
                    (B) The private retirement system must provide 
                people with income certainty.
                    (C) The private retirement system must be one of 
                shared responsibility.
                    (D) The private retirement system must be pooled 
                and professionally managed.

SEC. 213. COMMISSION ON RETIREMENT SECURITY.

    (a) Establishment.--There is established a commission to be known 
as the ``Commission on Retirement Security'' (referred to in this part 
as the ``Commission'').
    (b) Membership.--
            (1) In general.--The Commission shall be composed of 31 
        members. Such members shall be appointed in accordance with the 
        following:
                    (A) Two members appointed by the Chairman of the 
                Committee on Health, Education, Labor, and Pensions of 
                the Senate.
                    (B) Two members appointed by the Ranking Member of 
                the Committee on Health, Education, Labor, and Pensions 
                of the Senate.
                    (C) Two members appointed by the Chairman of the 
                Committee on Finance of the Senate.
                    (D) Two members appointed by the Ranking Member of 
                the Committee on Finance of the Senate.
                    (E) Two members appointed by the Chairman of the 
                Committee on Education and the Workforce of the House 
                of Representatives.
                    (F) Two members appointed by the Ranking Member of 
                the Committee on Education and the Workforce of the 
                House of Representatives.
                    (G) Two members appointed by the Chairman of the 
                Committee on Ways and Means of the House of 
                Representatives.
                    (H) Two members appointed by the Ranking Member of 
                the Committee on Ways and Means of the House of 
                Representatives.
                    (I) Fifteen members appointed by the President from 
                among officers or employees of the Executive Branch, 
                private citizens of the United States, or both. Not 
                more than 8 such members appointed by the President may 
                be from 1 political party.
            (2) Date of appointments.--The appointment of a member of 
        the Commission shall be made not later than 30 days after the 
        date of enactment of this Act.
    (c) Term; Vacancies.--
            (1) Term.--A member shall be appointed for the life of the 
        Commission.
            (2) Vacancies.--A vacancy on the Commission--
                    (A) shall not affect the powers of the Commission; 
                and
                    (B) shall be filled in the same manner as the 
                original appointment was made.
    (d) Initial Meeting.--Not later than 15 days after the date on 
which all members of the Commission have been appointed, the Commission 
shall hold the initial meeting of the Commission.
    (e) Meetings.--The Commission shall meet at the call of the co-
chairpersons. Meetings shall be open to the public unless designated 
otherwise by the co-chairpersons.
    (f) Quorum.--A majority of the members of the Commission shall 
constitute a quorum, but a lesser number of members may hold hearings.
    (g) Co-Chairpersons.--The Chairman of the Committee on Health, 
Education, Labor, and Pensions of the Senate and the Chairman of the 
Committee on Education and the Workforce of the House of 
Representatives shall each select 1 member to be co-chairperson of the 
Commission.

SEC. 214. DUTIES.

    (a) Review and Analysis.--The Commission shall--
            (1) review relevant analyses of the private retirement 
        system;
            (2) identify problems that threaten retirement security; 
        and
            (3) analyze potential solutions to such problems.
    (b) Recommendations.--The Commission shall develop recommendations 
on improving the private retirement system in the United States.
    (c) Report.--Not later than 1 year after the date of enactment of 
this Act, the Commission shall submit to Congress a report that 
contains--
            (1) a detailed statement of the findings and conclusions of 
        the Commission; and
            (2) the recommendations of the Commission for such 
        legislation (which shall include proposed legislative language) 
        and administrative actions as the Commission considers 
        appropriate.

SEC. 215. COMMISSION PERSONNEL MATTERS.

    (a) No Compensation of Members.--Members of the Commission shall 
serve without compensation.
    (b) Travel Expenses.--A member of the Commission who is not an 
officer or employee of the Federal Government shall be allowed travel 
expenses, including per diem in lieu of subsistence, while away from 
their homes or regular places of business in the performance of 
services for the Commission in the same manner as persons employed 
intermittently in the Government service are allowed such expenses 
under section 5703 of title 5, United States Code.
    (c) Staff.--
            (1) In general.--The co-chairpersons of the Commission may, 
        without regard to the civil service laws (including 
        regulations), appoint and terminate an executive director and 
        such other additional personnel as are necessary to enable the 
        Commission to perform the duties of the Commission.
            (2) Confirmation of executive director.--The employment of 
        an executive director shall be subject to confirmation by the 
        Commission.
            (3) Compensation.--
                    (A) In general.--Except as provided in subparagraph 
                (B), the co-chairpersons of the Commission may fix the 
                compensation of the executive director and other 
                personnel without regard to the provisions of chapter 
                51 and subchapter III of chapter 53 of title 5, United 
                States Code, relating to classification of positions 
                and General Schedule pay rates.
                    (B) Maximum rate of pay.--The rate of pay for the 
                executive director and other personnel shall not exceed 
                the rate payable for level V of the Executive Schedule 
                under section 5316 of title 5, United States Code.
    (d) Detail of Federal Government Employees.--
            (1) In general.--An employee of the Federal Government may 
        be detailed to the Commission without reimbursement.
            (2) Civil service status.--The detail of the employee shall 
        be without interruption or loss of civil service status or 
        privilege.
    (e) Procurement of Temporary and Intermittent Services.--The co-
chairpersons of the Commission may procure temporary and intermittent 
services in accordance with section 3109(b) of title 5, United States 
Code, at rates for individuals that do not exceed the daily equivalent 
of the annual rate of basic pay prescribed for level V of the Executive 
Schedule under section 5316 of that title.

SEC. 216. TERMINATION OF COMMISSION.

    The Commission shall terminate 30 days after the date on which the 
Commission submits the report of the Commission under section 214(c).

                        PART II--SOCIAL SECURITY

SEC. 221. DETERMINATION OF TAXABLE WAGES AND SELF-EMPLOYMENT INCOME 
              ABOVE CONTRIBUTION AND BENEFIT BASE AFTER 2012.

    (a) Determination of Taxable Wages Above Contribution and Benefit 
Base After 2012.--
            (1) Amendments to the internal revenue code of 1986.--
        Section 3121 of the Internal Revenue Code of 1986 is amended--
                    (A) in subsection (a)(1), by inserting ``the 
                applicable percentage (determined under subsection 
                (c)(1)) of'' before ``that part of the remuneration''; 
                and
                    (B) in subsection (c), by striking ``(c) Included 
                and Excluded Service.--For purposes of this chapter, 
                if'' and inserting the following:
    ``(c) Special Rules for Wages and Employment.--
            ``(1) Applicable percentage of remuneration in determining 
        taxable wages.--For purposes of subsection (a)(1), the 
        applicable percentage for a calendar year shall be equal to--
                    ``(A) for 2013, 90 percent;
                    ``(B) for 2014 through 2021, the applicable 
                percentage under this paragraph for the previous year, 
                decreased by 10 percentage points; and
                    ``(C) for 2022 and each year thereafter, 0 percent.
            ``(2) Included and excluded service.--For purposes of this 
        chapter, if''.
            (2) Amendments to the social security act.--Section 209 of 
        the Social Security Act (42 U.S.C. 409) is amended--
                    (A) in subsection (a)(1)(I)--
                            (i) by inserting ``and before 2013'' after 
                        ``1974''; and
                            (ii) by inserting ``and'' after the 
                        semicolon;
                    (B) in subsection (a)(1), by adding at the end the 
                following new subparagraph:
                    ``(J) The applicable percentage (determined under 
                subsection (l)) of that part of remuneration which, 
                after remuneration (other than remuneration referred to 
                in the succeeding subsections of this section) equal to 
                the contribution and benefit base (determined under 
                section 230) with respect to employment has been paid 
                to an individual during any calendar year after 2012 
                with respect to which such contribution and benefit 
                base is effective, is paid to such individual during 
                such calendar year;''; and
                    (C) by adding at the end the following new 
                subsection:
    ``(l) For purposes of subsection (a)(1)(J), the applicable 
percentage for a calendar year shall be equal to--
            ``(1) for 2013, 90 percent;
            ``(2) for 2014 through 2021, the applicable percentage 
        under this subsection for the previous year, decreased by 10 
        percentage points; and
            ``(3) for 2022 and each year thereafter, 0 percent.''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply with respect to remuneration paid in calendar years 
        after 2012.
    (b) Determination of Taxable Self-Employment Income Above 
Contribution and Benefit Base After 2012.--
            (1) Amendments to the internal revenue code of 1986.--
        Section 1402 of the Internal Revenue Code of 1986 is amended--
                    (A) in subsection (b)(1), by striking ``that part 
                of the net earnings'' and all that follows through 
                ``minus'' and inserting the following: ``an amount 
                equal to the applicable percentage (as determined under 
                subsection (d)(2)) of that part of the net earnings 
                from self-employment which is in excess of the 
                difference (not to be less than zero) between (i) an 
                amount equal to the contribution and benefit base (as 
                determined under section 230 of the Social Security 
                Act) which is effective for the calendar year in which 
                such taxable year begins, and''; and
                    (B) in subsection (d)--
                            (i) by striking ``(d) Employee and Wages.--
                        The term'' and inserting the following:
    ``(d) Rules and Definitions.--
            ``(1) Employee and wages.--The term''; and
                            (ii) by adding at the end the following:
            ``(2) Applicable percentage of net earnings from self-
        employment in determining taxable self-employment income.--For 
        purposes of subsection (b)(1), the applicable percentage for a 
        taxable year beginning in any calendar year referred to in such 
        paragraph shall be equal to--
                    ``(A) for 2013, 90 percent;
                    ``(B) for 2014 through 2021, the applicable 
                percentage under this paragraph for the previous year, 
                decreased by 10 percentage points; and
                    ``(C) for 2022 and each year thereafter, 0 
                percent.''.
            (2) Amendments to the social security act.--Section 211 of 
        the Social Security Act (42 U.S.C. 411) is amended--
                    (A) in subsection (b)--
                            (i) in paragraph (1)(I)--
                                    (I) by striking ``or'' after the 
                                semicolon; and
                                    (II) by inserting ``and before 
                                2013'' after ``1974'';
                            (ii) by redesignating paragraph (2) as 
                        paragraph (3); and
                            (iii) by inserting after paragraph (1) the 
                        following:
            ``(2) For any taxable year beginning in any calendar year 
        after 2012, an amount equal to the applicable percentage (as 
        determined under subsection (l)) of that part of net earnings 
        from self-employment which is in excess of the difference (not 
        to be less than zero) between--
                    ``(A) an amount equal to the contribution and 
                benefit base (as determined under section 230) that is 
                effective for such calendar year, and
                    ``(B) the amount of the wages paid to such 
                individual during such taxable year; or''; and
                    (B) by adding at the end the following:
    ``(l) For purposes of subsection (b)(2), the applicable percentage 
for a taxable year beginning in any calendar year referred to in such 
paragraph shall be equal to--
            ``(1) for 2013, 90 percent;
            ``(2) for 2014 through 2021, the applicable percentage 
        under this subsection for the previous year, decreased by 10 
        percentage points; and
            ``(3) for 2022 and each year thereafter, 0 percent.''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply with respect to taxable years beginning during or 
        after calendar year 2013.

SEC. 222. ADJUSTMENTS TO BEND POINTS IN DETERMINING PRIMARY INSURANCE 
              AMOUNT.

    (a) In General.--Section 215(a)(1) of the Social Security Act (42 
U.S.C. 415(a)(1)) is amended--
            (1) in subparagraph (A)--
                    (A) in clause (ii), by striking ``and'' at the end;
                    (B) in clause (iii), by striking the comma at the 
                end and inserting the following: ``but do not exceed 
                the amount established for purposes of this clause by 
                subparagraph (B), and''; and
                    (C) by adding at the end the following new clause:
            ``(iv) 5 percent of the individual's average indexed 
        monthly earnings to the extent that such earnings exceed the 
        amount established for purposes of clause (iii),''; and
            (2) in subparagraph (B)--
                    (A) in clause (i), by striking ``clause (i) and 
                (ii) of subparagraph (A) shall be $180 and $1,085'' and 
                inserting ``clauses (i), (ii), and (iii) of 
                subparagraph (A) shall be $180, $1,085, and $2,000'';
                    (B) by redesignating clause (iii) as clause (iv); 
                and
                    (C) by inserting after clause (ii) the following 
                new clause:
            ``(iii) For individuals who initially become eligible for 
        old-age or disability insurance benefits, or who die (before 
        becoming eligible for such benefits) in any calendar year after 
        2012, the amount determined under clause (i) of this 
        subparagraph for purposes of subparagraph (A)(i) for such 
        calendar year shall be increased by--
                    ``(I) for calendar year 2013, 1.5 percent;
                    ``(II) for each of calendar years 2014 through 
                2021, the percent determined under this clause for the 
                preceding year increased by 1.5 percentage points; and
                    ``(III) for calendar year 2022 and each year 
                thereafter, 15 percent.''.
    (b) Technical Amendment.--Section 215(e)(1) of such Act (42 U.S.C. 
415(e)(1)) is amended--
            (1) by striking ``before 1975, and the excess'' and 
        inserting ``before 1975, the excess''; and
            (2) by inserting ``and for years after 2012, the amount of 
        remuneration and net earnings from self-employment paid to or 
        derived by such individual during such year after application 
        of sections 209(a)(1)(J) and 211(b)(2),'' after ``such 
        contribution and benefit base is effective,''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to individuals who initially become eligible (within 
the meaning of section 215(a)(3)(B) of the Social Security Act) for 
old-age or disability insurance benefits under title II of the Social 
Security Act, or who die (before becoming eligible for such benefits), 
in any calendar year after 2012.

SEC. 223. CONSUMER PRICE INDEX FOR ELDERLY CONSUMERS.

    (a) In General.--The Bureau of Labor Statistics of the Department 
of Labor shall prepare and publish an index for each calendar month to 
be known as the ``Consumer Price Index for Elderly Consumers'' that 
indicates changes over time in expenditures for consumption which are 
typical for individuals in the United States who have attained early 
retirement age (as defined under section 216(l)(2) of the Social 
Security Act (42 U.S.C. 416(l)(2)), for purposes of an old-age, wife's, 
or husband's insurance benefit).
    (b) Effective Date.--Subsection (a) shall apply with respect to 
calendar months ending on or after June 30 of the calendar year in 
which this Act is enacted.
    (c) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary to carry out the provisions of 
this section.

SEC. 224. COMPUTATION OF COST-OF-LIVING INCREASES FOR SOCIAL SECURITY 
              BENEFITS.

    (a) In General.--Section 215(i) of the Social Security Act (42 
U.S.C. 415(i)) is amended--
            (1) in paragraph (1)(G), by inserting before the period the 
        following: ``, and, with respect to any monthly insurance 
        benefit payable under this title, effective for adjustments 
        under this subsection to the primary insurance amount on which 
        such benefit is based (or to any such benefit under section 227 
        or 228), the applicable Consumer Price Index shall be deemed to 
        be the Consumer Price Index for Elderly Consumers and such 
        primary insurance amount shall be deemed adjusted under this 
        subsection using such Index''; and
            (2) in paragraph (4), by striking ``and by section 9001'' 
        and inserting ``, by section 9001'', and by inserting after 
        ``1986,'' the following: ``and by section 224(a) of the Rebuild 
        America Act,''.
    (b) Conforming Amendments in Applicable Former Law.--Section 
215(i)(1)(C) of the Social Security Act, as in effect in December 1978 
and applied in certain cases under the provisions of such Act in effect 
after December 1978, is amended by inserting before the period the 
following: ``, and, with respect to any monthly insurance benefit 
payable under this title, effective for adjustments under this 
subsection to the primary insurance amount on which such benefit is 
based (or to any such benefit under section 227 or 228), the applicable 
Consumer Price Index shall be deemed to be the Consumer Price Index for 
Elderly Consumers and such primary insurance amount shall be deemed 
adjusted under this subsection using such Index''.
    (c) Effective Date.--The amendments made by this section shall 
apply to determinations made by the Commissioner of Social Security 
under section 215(i)(2) of the Social Security Act (42 U.S.C. 
415(i)(2)), with respect to cost-of-living computation quarters ending 
on or after September 30, 2013.

SEC. 225. NON-APPLICATION OF INCREASE IN SOCIAL SECURITY BENEFITS FOR 
              OTHER FEDERAL OR FEDERALLY ASSISTED PROGRAMS.

    Any increase in old-age or disability insurance benefits under 
title II of the Social Security Act as a result of the amendments made 
by this Act shall not be regarded as income and shall not be regarded 
as a resource for any month after December 2012, for purposes of 
determining the eligibility of the recipient (or the recipient's spouse 
or family) for benefits or assistance, or the amount or extent of 
benefits or assistance, under any Federal program or under any State or 
local program financed in whole or in part with Federal funds.

       Subtitle C--Protecting Overtime Pay for Working Americans

SEC. 231. SALARY THRESHOLDS, HIGHLY COMPENSATED EMPLOYEES, AND PRIMARY 
              DUTIES.

    (a) Salary Thresholds for Executive, Administrative, and 
Professional Employees.--Section 13 of the Fair Labor Standards Act of 
1938 (29 U.S.C. 213) is amended--
            (1) in subsection (a)(1), by inserting before ``; or'' the 
        following: ``, subject to the requirement that any employee who 
        the Secretary determines is required to be paid on a salary or 
        fee basis in order to be exempt under this subsection shall, in 
        order to be exempt, be compensated at a rate of not less than 
        the salary rate (or equivalent fee basis) determined under 
        subsection (k)''; and
            (2) by adding at the end the following:
    ``(k) Salary Rates.--
            ``(1) In general.--The salary rate (or equivalent fee 
        basis) determined under this subsection for purposes of 
        subsection (a)(1) shall be--
                    ``(A) beginning 1 year after the first day of the 
                third month that begins after the date of enactment of 
                the Rebuild America Act, $655 per week;
                    ``(B) beginning 2 years after that first day, $855 
                per week;
                    ``(C) beginning 3 years after that first day, 
                $1,045 per week; and
                    ``(D) beginning on the date that is 4 years after 
                that first day, and on that first day in each 
                succeeding year, an adjusted amount that is--
                            ``(i) not less than the amount in effect 
                        under this paragraph on the day before the date 
                        the adjustment is being made;
                            ``(ii) increased from such amount by the 
                        annual percentage increase in the Consumer 
                        Price Index for Urban Wage Earners and Clerical 
                        Workers; and
                            ``(iii) rounded to the nearest multiple of 
                        $1.00.
            ``(2) Special rule.--Notwithstanding paragraph (1), for any 
        employee for whom the minimum wage would otherwise be 
        determined pursuant to section 8103(b) of the Fair Minimum Wage 
        Act of 2007 (29 U.S.C. 206 note), the Secretary may determine, 
        through regulations, the salary rate (or equivalent fee 
        basis).''.
    (b) Definitions.--Section 13 of the Fair Labor Standards Act of 
1938 (as amended by subsection (a)) (29 U.S.C. 213) is further amended 
by adding at the end the following:
    ``(l) Definitions.--
            ``(1) Annual percentage increase; consumer price index.--
        For purposes of this section--
                    ``(A) the term `annual percentage increase', when 
                used in reference to the Consumer Price Index for Urban 
                Wage Earners and Clerical Workers, means the annual 
                percentage increase calculated by the Secretary under 
                section 6(h)(2), as amended by section 231 of the 
                Rebuild America Act; and
                    ``(B) the term `Consumer Price Index for Urban Wage 
                Earners and Clerical Workers' means the Consumer Price 
                Index for Urban Wage Earners and Clerical Workers 
                (United States city average, all items, not seasonally 
                adjusted), or its successor publication, as determined 
                by the Bureau of Labor Statistics.
            ``(2) Primary duty.--For purposes of paragraphs (1) and 
        (17) of subsection (a), including the regulations interpreting 
        such paragraphs, any reference to the term `primary duty' (or a 
        successor term) when used with respect to determining if an 
        employee is employed in a bona fide executive, administrative, 
        or professional capacity, or in a position described in 
        subsection (a)(17), means the duty that an employee spends more 
        than 50 percent of the employee's work hours per week 
        performing.''.
    (c) Highly Compensated Employees.--
            (1) In general.--If the Secretary of Labor, in the 
        Secretary's discretion, determines that an employee may be 
        exempt for purposes of section 13(a)(1) of the Fair Labor 
        Standards Act of 1938 (29 U.S.C. 213(a)(1)), as a highly 
        compensated employee (as such term is defined and delimited by 
        the Secretary), then the level of total annual compensation 
        necessary for such exemption shall be--
                    (A) for the calendar year that includes the 
                effective date of this subsection, $120,000; and
                    (B) for each succeeding calendar year, an adjusted 
                amount that is--
                            (i) not less than the amount in effect 
                        under this paragraph on the day before the date 
                        such adjustment is being made;
                            (ii) increased from such amount by the 
                        annual percentage increase in the Consumer 
                        Price Index for Urban Wage Earners and Clerical 
                        Workers; and
                            (iii) rounded to the nearest multiple of 
                        $1.00.
            (2) Definitions.--For purposes of this subsection, the 
        terms ``annual percentage increase'' and ``Consumer Price Index 
        for Urban Wage Earners and Clerical Workers'' have the meanings 
        given the terms in section 13(l) of the Fair Labor Standards 
        Act of 1938 (29 U.S.C. 213(l)), as added by subsection (b).
            (3) Rule of construction.--Nothing in this subsection or 
        the regulations promulgated by the Secretary of Labor under 
        this subsection shall override any provision of a collective 
        bargaining agreement that provides for overtime employment 
        compensation, or rights to such compensation, that exceed the 
        requirements of the Fair Labor Standards Act of 1938 (29 U.S.C. 
        201 et seq.).
    (d) Publication of Notice.--Not later than 60 days before the date 
any increase in the salary rate (or equivalent fee basis) required 
under section 13(k)(1)(D) of the Fair Labor Standards Act of 1938 (29 
U.S.C. 213(a)(k)(1)(D)) takes effect, or any increase in the amount of 
compensation required for highly compensated employee exemption 
required under subsection (c) takes effect, the Secretary of Labor 
shall publish, in the Federal Register and on the website of the 
Department of Labor, a notice announcing the adjusted salary rate (or 
equivalent fee basis) requirement or adjusted amount of compensation, 
respectively. The provisions of section 553 of title 5, United States 
Code, shall not apply to any notice required under this subsection.
    (e) Effective Date.--This section, and the amendments made by this 
section, shall take effect on the date that is 1 year after the first 
day of the third month that begins after the date of enactment of the 
Rebuild America Act.

 Subtitle D--Preventing Americans From Having To Choose Between Their 
                       Health and Their Paycheck

SEC. 241. SHORT TITLE.

    This subtitle may be cited as the ``Healthy Families Act''.

SEC. 242. FINDINGS.

    Congress makes the following findings:
            (1) Working Americans need time to meet their own health 
        care needs and to care for family members, including their 
        children, spouse, parents, and parents-in-law, and other 
        children and adults for whom they are caregivers.
            (2) Health care needs include preventive health care, 
        diagnostic procedures, medical treatment, and recovery in 
        response to short- and long-term illnesses and injuries.
            (3) Providing employees time off to meet health care needs 
        ensures that they will be healthier in the long run. Preventive 
        care helps avoid illnesses and injuries and routine medical 
        care helps detect illnesses early and shorten their duration.
            (4) When parents are available to care for their children 
        who become sick, children recover faster, more serious 
        illnesses are prevented, and children's overall mental and 
        physical health improve. In a 2009 study published in the 
        American Journal of Public Health, 81 percent of parents of a 
        child with special health care needs reported that taking leave 
        from work to be with their child had a ``good'' or ``very 
        good'' effect on their child's physical health. Similarly, 85 
        percent of parents of such a child found that taking such leave 
        had a ``good'' or ``very good'' effect on their child's 
        emotional health.
            (5) When parents cannot afford to miss work and must send 
        children with contagious illnesses to child care centers or 
        schools, infection can spread rapidly through child care 
        centers and schools.
            (6) Providing paid sick time improves public health by 
        reducing infectious disease. Policies that make it easier for 
        sick adults and children to be isolated at home reduce the 
        spread of infectious disease.
            (7) Routine medical care reduces medical costs by detecting 
        and treating illness and injury early, decreasing the need for 
        emergency care. These savings benefit public and private payers 
        of health insurance, including private businesses.
            (8) The provision of individual and family sick time by 
        large and small businesses, both here in the United States and 
        elsewhere, demonstrates that policy solutions are both feasible 
        and affordable in a competitive economy. A 2009 study by the 
        Center for Economic and Policy Research found that, of 22 
        countries with comparable economies, the United States was 1 of 
        only 3 countries that did not provide any paid time off for 
        workers with short-term illnesses.
            (9) Measures that ensure that employees are in good health 
        and do not need to worry about unmet family health problems 
        help businesses by promoting productivity and reducing employee 
        turnover.
            (10) The American Productivity Audit completed in 2003 
        found that lost productivity due to illness costs 
        $226,000,000,000 annually, and that 71 percent of that cost 
        stems from presenteeism, the practice of employees coming to 
        work despite illness. Studies in the Journal of Occupational 
        and Environmental Medicine, the Employee Benefit News, and the 
        Harvard Business Review show that presenteeism is a larger 
        productivity drain than either absenteeism or short-term 
        disability.
            (11) The absence of paid sick time has forced Americans to 
        make untenable choices between needed income and jobs on the 
        one hand and caring for their own and their family's health on 
        the other.
            (12) Nearly 40 percent of the private-sector workforce 
        (about 40,000,000 workers) lack paid sick time. Another 
        4,000,000 theoretically have access to sick time, but have not 
        been on the job long enough to use it. Millions more lack sick 
        time they can use to care for a sick child or ill family 
        member.
            (13) Workers' access to paid sick time varies dramatically 
        by wage level. For private-sector workers in the lowest 
        quartile of earners, 68 percent lack paid sick time. For 
        workers in the next 2 quartiles, 34 and 25 percent, 
        respectively, lack paid sick time. Even for workers in the 
        highest income quartile, 16 percent lack paid sick time. In 
        addition, millions of workers cannot use paid sick time to care 
        for ill family members.
            (14) Due to the roles of men and women in society, the 
        primary responsibility for family caregiving often falls on 
        women, and such responsibility affects the working lives of 
        women more than it affects the working lives of men.
            (15) An increasing number of men are also taking on 
        caregiving obligations, and men who request paid time for 
        caregiving purposes are often denied accommodation or penalized 
        because of stereotypes that caregiving is only ``women's 
        work''.
            (16) Employers' reliance on persistent stereotypes about 
        the ``proper'' roles of both men and women in the workplace and 
        in the home continues a cycle of discrimination and fosters 
        stereotypical views about women's commitment to work and their 
        value as employees.
            (17) Employment standards that apply to only one gender 
        have serious potential for encouraging employers to 
        discriminate against employees and applicants for employment 
        who are of that gender.
            (18) It is in the national interest to ensure that all 
        Americans can care for their own health and the health of their 
        families while prospering at work.
            (19) Nearly 1 in 3 American women report physical or sexual 
        abuse by a husband or boyfriend at some point in their lives. 
        Domestic violence also affects men. Women account for about 85 
        percent of the victims of domestic violence and men account for 
        approximately 15 percent of the victims. Therefore, women 
        disproportionately need time off to care for their health or to 
        find solutions, such as obtaining a restraining order or 
        finding housing, to avoid or prevent physical or sexual abuse.
            (20) One study showed that 85 percent of domestic violence 
        victims at a women's shelter who were employed missed work 
        because of abuse. The mean number of days of paid work lost by 
        a rape victim is 8.1 days, by a victim of physical assault is 
        7.2 days, and by a victim of stalking is 10.1 days. Nationwide, 
        domestic violence victims lose almost 8,000,000 days of paid 
        work per year.
            (21) Without paid sick days that can be used to address the 
        effects of domestic violence, these victims are in grave danger 
        of losing their jobs. One survey found that 96 percent of 
        employed domestic violence victims experienced problems at work 
        related to the violence. The Government Accountability Office 
        similarly found that 24 to 52 percent of victims report losing 
        a job due, at least in part, to domestic violence. The loss of 
        employment can be particularly devastating for victims of 
        domestic violence, who often need economic security to ensure 
        safety.
            (22) The Centers for Disease Control and Prevention has 
        estimated that domestic violence costs over $700,000,000 
        annually due to the victims' lost productivity in employment.
            (23) Efforts to assist abused employees result in positive 
        outcomes for employers as well as employees because employers 
        can retain workers who might otherwise be compelled to leave.

SEC. 243. PURPOSES.

    The purposes of this subtitle are--
            (1) to ensure that all working Americans can address their 
        own health needs and the health needs of their families by 
        requiring employers to permit employees to earn up to 56 hours 
        of paid sick time including paid time for family care;
            (2) to diminish public and private health care costs by 
        enabling workers to seek early and routine medical care for 
        themselves and their family members;
            (3) to assist employees who are, or whose family members 
        are, victims of domestic violence, sexual assault, or stalking, 
        by providing the employees with paid time away from work to 
        allow the victims to receive treatment and to take the 
        necessary steps to ensure their protection;
            (4) to accomplish the purposes described in paragraphs (1) 
        through (3) in a manner that is feasible for employers; and
            (5) consistent with the provision of the 14th Amendment to 
        the Constitution relating to equal protection of the laws, and 
        pursuant to Congress' power to enforce that provision under 
        section 5 of that Amendment--
                    (A) to accomplish the purposes described in 
                paragraphs (1) through (3) in a manner that minimizes 
                the potential for employment discrimination on the 
                basis of sex by ensuring generally that paid sick time 
                is available for eligible medical reasons on a gender-
                neutral basis; and
                    (B) to promote the goal of equal employment 
                opportunity for women and men.

SEC. 244. DEFINITIONS.

    In this subtitle:
            (1) Child.--The term ``child'' means a biological, foster, 
        or adopted child, a stepchild, a legal ward, or a child of a 
        person standing in loco parentis, who is--
                    (A) under 18 years of age; or
                    (B) 18 years of age or older and incapable of self-
                care because of a mental or physical disability.
            (2) Domestic violence.--The term ``domestic violence'' has 
        the meaning given the term in section 40002(a) of the Violence 
        Against Women Act of 1994 (42 U.S.C. 13925(a)), except that the 
        reference in such section to the term ``jurisdiction receiving 
        grant monies'' shall be deemed to mean the jurisdiction in 
        which the victim lives or the jurisdiction in which the 
        employer involved is located.
            (3) Employee.--The term ``employee'' means an individual 
        who is--
                    (A)(i) an employee, as defined in section 3(e) of 
                the Fair Labor Standards Act of 1938 (29 U.S.C. 
                203(e)), who is not covered under subparagraph (E), 
                including such an employee of the Library of Congress, 
                except that a reference in such section to an employer 
                shall be considered to be a reference to an employer 
                described in clauses (i)(I) and (ii) of paragraph 
                (4)(A); or
                    (ii) an employee of the Government Accountability 
                Office;
                    (B) a State employee described in section 304(a) of 
                the Government Employee Rights Act of 1991 (42 U.S.C. 
                2000e-16c(a));
                    (C) a covered employee, as defined in section 101 
                of the Congressional Accountability Act of 1995 (2 
                U.S.C. 1301), other than an applicant for employment;
                    (D) a covered employee, as defined in section 
                411(c) of title 3, United States Code; or
                    (E) a Federal officer or employee covered under 
                subchapter V of chapter 63 of title 5, United States 
                Code.
            (4) Employer.--
                    (A) In general.--The term ``employer'' means a 
                person who is--
                            (i)(I) a covered employer, as defined in 
                        subparagraph (B), who is not covered under 
                        subclause (V);
                            (II) an entity employing a State employee 
                        described in section 304(a) of the Government 
                        Employee Rights Act of 1991;
                            (III) an employing office, as defined in 
                        section 101 of the Congressional Accountability 
                        Act of 1995;
                            (IV) an employing office, as defined in 
                        section 411(c) of title 3, United States Code; 
                        or
                            (V) an employing agency covered under 
                        subchapter V of chapter 63 of title 5, United 
                        States Code; and
                            (ii) is engaged in commerce (including 
                        government), or an industry or activity 
                        affecting commerce (including government), as 
                        defined in subparagraph (B)(iii).
                    (B) Covered employer.--
                            (i) In general.--In subparagraph (A)(i)(I), 
                        the term ``covered employer''--
                                    (I) means any person engaged in 
                                commerce or in any industry or activity 
                                affecting commerce who employs 15 or 
                                more employees for each working day 
                                during each of 20 or more calendar 
                                workweeks in the current or preceding 
                                calendar year;
                                    (II) includes--
                                            (aa) any person who acts, 
                                        directly or indirectly, in the 
                                        interest of an employer to any 
                                        of the employees of such 
                                        employer; and
                                            (bb) any successor in 
                                        interest of an employer;
                                    (III) includes any ``public 
                                agency'', as defined in section 3(x) of 
                                the Fair Labor Standards Act of 1938 
                                (29 U.S.C. 203(x)); and
                                    (IV) includes the Government 
                                Accountability Office and the Library 
                                of Congress.
                            (ii) Public agency.--For purposes of clause 
                        (i)(III), a public agency shall be considered 
                        to be a person engaged in commerce or in an 
                        industry or activity affecting commerce.
                            (iii) Definitions.--For purposes of this 
                        subparagraph:
                                    (I) Commerce.--The terms 
                                ``commerce'' and ``industry or activity 
                                affecting commerce'' mean any activity, 
                                business, or industry in commerce or in 
                                which a labor dispute would hinder or 
                                obstruct commerce or the free flow of 
                                commerce, and include ``commerce'' and 
                                any ``industry affecting commerce'', as 
                                defined in paragraphs (1) and (3) of 
                                section 501 of the Labor Management 
                                Relations Act, 1947 (29 U.S.C. 142 (1) 
                                and (3)).
                                    (II) Employee.--The term 
                                ``employee'' has the same meaning given 
                                such term in section 3(e) of the Fair 
                                Labor Standards Act of 1938 (29 U.S.C. 
                                203(e)).
                                    (III) Person.--The term ``person'' 
                                has the same meaning given such term in 
                                section 3(a) of the Fair Labor 
                                Standards Act of 1938 (29 U.S.C. 
                                203(a)).
                    (C) Predecessors.--Any reference in this paragraph 
                to an employer shall include a reference to any 
                predecessor of such employer.
            (5) Employment benefits.--The term ``employment benefits'' 
        means all benefits provided or made available to employees by 
        an employer, including group life insurance, health insurance, 
        disability insurance, sick leave, annual leave, educational 
        benefits, and pensions, regardless of whether such benefits are 
        provided by a practice or written policy of an employer or 
        through an ``employee benefit plan'', as defined in section 
        3(3) of the Employee Retirement Income Security Act of 1974 (29 
        U.S.C. 1002(3)).
            (6) Health care provider.--The term ``health care 
        provider'' means a provider who--
                    (A)(i) is a doctor of medicine or osteopathy who is 
                authorized to practice medicine or surgery (as 
                appropriate) by the State in which the doctor 
                practices; or
                    (ii) is any other person determined by the 
                Secretary to be capable of providing health care 
                services; and
                    (B) is not employed by an employer for whom the 
                provider issues certification under this subtitle.
            (7) Paid sick time.--The term ``paid sick time'' means an 
        increment of compensated leave that can be earned by an 
        employee for use during an absence from employment for any of 
        the reasons described in paragraphs (1) through (4) of section 
        245(b).
            (8) Parent.--The term ``parent'' means a biological, 
        foster, or adoptive parent of an employee, a stepparent of an 
        employee, or a legal guardian or other person who stood in loco 
        parentis to an employee when the employee was a child.
            (9) Secretary.--The term ``Secretary'' means the Secretary 
        of Labor.
            (10) Sexual assault.--The term ``sexual assault'' has the 
        meaning given the term in section 40002(a) of the Violence 
        Against Women Act of 1994 (42 U.S.C. 13925(a)).
            (11) Spouse.--The term ``spouse'', with respect to an 
        employee, has the meaning given such term by the marriage laws 
        of the State in which the employee resides.
            (12) Stalking.--The term ``stalking'' has the meaning given 
        the term in section 40002(a) of the Violence Against Women Act 
        of 1994 (42 U.S.C. 13925(a)).
            (13) Victim services organization.--The term ``victim 
        services organization'' means a nonprofit, nongovernmental 
        organization that provides assistance to victims of domestic 
        violence, sexual assault, or stalking or advocates for such 
        victims, including a rape crisis center, an organization 
        carrying out a domestic violence, sexual assault, or stalking 
        prevention or treatment program, an organization operating a 
        shelter or providing counseling services, or a legal services 
        organization or other organization providing assistance through 
        the legal process.

SEC. 245. PROVISION OF PAID SICK TIME.

    (a) Accrual of Paid Sick Time.--
            (1) In general.--An employer shall permit each employee 
        employed by the employer to earn not less than 1 hour of paid 
        sick time for every 30 hours worked, to be used as described in 
        subsection (b). An employer shall not be required to permit an 
        employee to earn, under this section, more than 56 hours of 
        paid sick time in a calendar year, unless the employer chooses 
        to set a higher limit.
            (2) Exempt employees.--
                    (A) In general.--Except as provided in paragraph 
                (3), for purposes of this section, an employee who is 
                exempt from overtime requirements under section 
                13(a)(1) of the Fair Labor Standards Act of 1938 (29 
                U.S.C. 213(a)(1)) shall be assumed to work 40 hours in 
                each workweek.
                    (B) Shorter normal workweek.--If the normal 
                workweek of such an employee is less than 40 hours, the 
                employee shall earn paid sick time based upon that 
                normal workweek.
            (3) Dates of accrual and use.--Employees shall begin to 
        earn paid sick time under this section at the commencement of 
        their employment. An employee shall be entitled to use the 
        earned paid sick time beginning on the 60th calendar day 
        following commencement of the employee's employment. After that 
        60th calendar day, the employee may use the paid sick time as 
        the time is earned. An employer may, at the discretion of the 
        employer, loan paid sick time to an employee in advance of the 
        earning of such time under this section by such employee.
            (4) Carryover.--
                    (A) In general.--Except as provided in subparagraph 
                (B), paid sick time earned under this section shall 
                carry over from 1 calendar year to the next.
                    (B) Construction.--This subtitle shall not be 
                construed to require an employer to permit an employee 
                to accrue more than 56 hours of earned paid sick time 
                at a given time.
            (5) Employers with existing policies.--Any employer with a 
        paid leave policy who makes available an amount of paid leave 
        that is sufficient to meet the requirements of this section and 
        that may be used for the same purposes and under the same 
        conditions as the purposes and conditions outlined in 
        subsection (b) shall not be required to permit an employee to 
        earn additional paid sick time under this section.
            (6) Construction.--Nothing in this section shall be 
        construed as requiring financial or other reimbursement to an 
        employee from an employer upon the employee's termination, 
        resignation, retirement, or other separation from employment 
        for earned paid sick time that has not been used.
            (7) Reinstatement.--If an employee is separated from 
        employment with an employer and is rehired, within 12 months 
        after that separation, by the same employer, the employer shall 
        reinstate the employee's previously earned paid sick time. The 
        employee shall be entitled to use the earned paid sick time and 
        earn additional paid sick time at the recommencement of 
        employment with the employer.
            (8) Prohibition.--An employer may not require, as a 
        condition of providing paid sick time under this subtitle, that 
        the employee involved search for or find a replacement worker 
        to cover the hours during which the employee is using paid sick 
        time.
    (b) Uses.--Paid sick time earned under this section may be used by 
an employee for any of the following:
            (1) An absence resulting from a physical or mental illness, 
        injury, or medical condition of the employee.
            (2) An absence resulting from obtaining professional 
        medical diagnosis or care, or preventive medical care, for the 
        employee.
            (3) An absence for the purpose of caring for a child, a 
        parent, a spouse, or any other individual related by blood or 
        affinity whose close association with the employee is the 
        equivalent of a family relationship, who--
                    (A) has any of the conditions or needs for 
                diagnosis or care described in paragraph (1) or (2); 
                and
                    (B) in the case of someone who is not a child, is 
                otherwise in need of care.
            (4) An absence resulting from domestic violence, sexual 
        assault, or stalking, if the time is to--
                    (A) seek medical attention for the employee or the 
                employee's child, parent, or spouse, or an individual 
                related to the employee as described in paragraph (3), 
                to recover from physical or psychological injury or 
                disability caused by domestic violence, sexual assault, 
                or stalking;
                    (B) obtain or assist a related person described in 
                paragraph (3) in obtaining services from a victim 
                services organization;
                    (C) obtain or assist a related person described in 
                paragraph (3) in obtaining psychological or other 
                counseling;
                    (D) seek relocation; or
                    (E) take legal action, including preparing for or 
                participating in any civil or criminal legal proceeding 
                related to or resulting from domestic violence, sexual 
                assault, or stalking.
    (c) Scheduling.--An employee shall make a reasonable effort to 
schedule a period of paid sick time under this subtitle in a manner 
that does not unduly disrupt the operations of the employer.
    (d) Procedures.--
            (1) In general.--Paid sick time shall be provided upon the 
        oral or written request of an employee. Such request shall--
                    (A) include the expected duration of the period of 
                such time;
                    (B) in a case in which the need for such period of 
                time is foreseeable at least 7 days in advance of such 
                period, be provided at least 7 days in advance of such 
                period; and
                    (C) otherwise, be provided as soon as practicable 
                after the employee is aware of the need for such 
                period.
            (2) Certification in general.--
                    (A) Provision.--
                            (i) In general.--Subject to subparagraph 
                        (C), an employer may require that a request for 
                        paid sick time under this section for a purpose 
                        described in paragraph (1), (2), or (3) of 
                        subsection (b) be supported by a certification 
                        issued by the health care provider of the 
                        eligible employee or of an individual described 
                        in subsection (b)(3), as appropriate, if the 
                        period of such time covers more than 3 
                        consecutive workdays.
                            (ii) Timeliness.--The employee shall 
                        provide a copy of such certification to the 
                        employer in a timely manner, not later than 30 
                        days after the first day of the period of time. 
                        The employer shall not delay the commencement 
                        of the period of time on the basis that the 
                        employer has not yet received the 
                        certification.
                    (B) Sufficient certification.--
                            (i) In general.--A certification provided 
                        under subparagraph (A) shall be sufficient if 
                        it states--
                                    (I) the date on which the period of 
                                time will be needed;
                                    (II) the probable duration of the 
                                period of time;
                                    (III) the appropriate medical facts 
                                within the knowledge of the health care 
                                provider regarding the condition 
                                involved, subject to clause (ii); and
                                    (IV)(aa) for purposes of paid sick 
                                time under subsection (b)(1), a 
                                statement that absence from work is 
                                medically necessary;
                                    (bb) for purposes of such time 
                                under subsection (b)(2), the dates on 
                                which testing for a medical diagnosis 
                                or care is expected to be given and the 
                                duration of such testing or care; and
                                    (cc) for purposes of such time 
                                under subsection (b)(3), in the case of 
                                time to care for someone who is not a 
                                child, a statement that care is needed 
                                for an individual described in such 
                                subsection, and an estimate of the 
                                amount of time that such care is needed 
                                for such individual.
                            (ii) Limitation.--In issuing a 
                        certification under subparagraph (A), a health 
                        care provider shall make reasonable efforts to 
                        limit the medical facts described in clause 
                        (i)(III) that are disclosed in the 
                        certification to the minimum necessary to 
                        establish a need for the employee to utilize 
                        paid sick time.
                    (C) Regulations.--Regulations prescribed under 
                section 253 shall specify the manner in which an 
                employee who does not have health insurance shall 
                provide a certification for purposes of this paragraph.
                    (D) Confidentiality and nondisclosure.--
                            (i) Protected health information.--Nothing 
                        in this subtitle shall be construed to require 
                        a health care provider to disclose information 
                        in violation of section 1177 of the Social 
                        Security Act (42 U.S.C. 1320d-6) or the 
                        regulations promulgated pursuant to section 
                        264(c) of the Health Insurance Portability and 
                        Accountability Act of 1996 (42 U.S.C. 1320d-2 
                        note).
                            (ii) Health information records.--If an 
                        employer possesses health information about an 
                        employee or an employee's child, parent, spouse 
                        or other individual described in subsection 
                        (b)(3), such information shall--
                                    (I) be maintained on a separate 
                                form and in a separate file from other 
                                personnel information;
                                    (II) be treated as a confidential 
                                medical record; and
                                    (III) not be disclosed except to 
                                the affected employee or with the 
                                permission of the affected employee.
            (3) Certification in the case of domestic violence, sexual 
        assault, or stalking.--
                    (A) In general.--An employer may require that a 
                request for paid sick time under this section for a 
                purpose described in subsection (b)(4) be supported by 
                1 of the following forms of documentation:
                            (i) A police report indicating that the 
                        employee, or a member of the employee's family 
                        described in subsection (b)(4), was a victim of 
                        domestic violence, sexual assault, or stalking.
                            (ii) A court order protecting or separating 
                        the employee or a member of the employee's 
                        family described in subsection (b)(4) from the 
                        perpetrator of an act of domestic violence, 
                        sexual assault, or stalking, or other evidence 
                        from the court or prosecuting attorney that the 
                        employee or a member of the employee's family 
                        described in subsection (b)(4) has appeared in 
                        court or is scheduled to appear in court in a 
                        proceeding related to domestic violence, sexual 
                        assault, or stalking.
                            (iii) Other documentation signed by an 
                        employee or volunteer working for a victim 
                        services organization, an attorney, a police 
                        officer, a medical professional, a social 
                        worker, an antiviolence counselor, or a member 
                        of the clergy, affirming that the employee or a 
                        member of the employee's family described in 
                        subsection (b)(4) is a victim of domestic 
                        violence, sexual assault, or stalking.
                    (B) Requirements.--The requirements of paragraph 
                (2) shall apply to certifications under this paragraph, 
                except that--
                            (i) subclauses (III) and (IV) of 
                        subparagraph (B)(i) and subparagraph (B)(ii) of 
                        such paragraph shall not apply;
                            (ii) the certification shall state the 
                        reason that the leave is required with the 
                        facts to be disclosed limited to the minimum 
                        necessary to establish a need for the employee 
                        to be absent from work, and the employee shall 
                        not be required to explain the details of the 
                        domestic violence, sexual assault, or stalking 
                        involved; and
                            (iii) with respect to confidentiality under 
                        subparagraph (D) of such paragraph, any 
                        information provided to the employer under this 
                        paragraph shall be confidential, except to the 
                        extent that any disclosure of such information 
                        is--
                                    (I) requested or consented to in 
                                writing by the employee; or
                                    (II) otherwise required by 
                                applicable Federal or State law.

SEC. 246. POSTING REQUIREMENT.

    (a) In General.--Each employer shall post and keep posted a notice, 
to be prepared or approved in accordance with procedures specified in 
regulations prescribed under section 253, setting forth excerpts from, 
or summaries of, the pertinent provisions of this subtitle including--
            (1) information describing paid sick time available to 
        employees under this subtitle;
            (2) information pertaining to the filing of an action under 
        this subtitle;
            (3) the details of the notice requirement for a foreseeable 
        period of time under section 245(d)(1)(B); and
            (4) information that describes--
                    (A) the protections that an employee has in 
                exercising rights under this subtitle; and
                    (B) how the employee can contact the Secretary (or 
                other appropriate authority as described in section 
                248) if any of the rights are violated.
    (b) Location.--The notice described under subsection (a) shall be 
posted--
            (1) in conspicuous places on the premises of the employer, 
        where notices to employees (including applicants) are 
        customarily posted; or
            (2) in employee handbooks.
    (c) Violation; Penalty.--Any employer who willfully violates the 
posting requirements of this section shall be subject to a civil fine 
in an amount not to exceed $100 for each separate offense.

SEC. 247. PROHIBITED ACTS.

    (a) Interference With Rights.--
            (1) Exercise of rights.--It shall be unlawful for any 
        employer to interfere with, restrain, or deny the exercise of, 
        or the attempt to exercise, any right provided under this 
        subtitle, including--
                    (A) discharging or discriminating against 
                (including retaliating against) any individual, 
                including a job applicant, for exercising, or 
                attempting to exercise, any right provided under this 
                subtitle;
                    (B) using the taking of paid sick time under this 
                subtitle as a negative factor in an employment action, 
                such as hiring, promotion, or a disciplinary action; or
                    (C) counting the paid sick time under a no-fault 
                attendance policy or any other absence control policy.
            (2) Discrimination.--It shall be unlawful for any employer 
        to discharge or in any other manner discriminate against 
        (including retaliating against) any individual, including a job 
        applicant, for opposing any practice made unlawful by this 
        subtitle.
    (b) Interference With Proceedings or Inquiries.--It shall be 
unlawful for any person to discharge or in any other manner 
discriminate against (including retaliating against) any individual, 
including a job applicant, because such individual--
            (1) has filed an action, or has instituted or caused to be 
        instituted any proceeding, under or related to this subtitle;
            (2) has given, or is about to give, any information in 
        connection with any inquiry or proceeding relating to any right 
        provided under this subtitle; or
            (3) has testified, or is about to testify, in any inquiry 
        or proceeding relating to any right provided under this 
        subtitle.
    (c) Construction.--Nothing in this section shall be construed to 
state or imply that the scope of the activities prohibited by section 
105 of the Family and Medical Leave Act of 1993 (29 U.S.C. 2615) is 
less than the scope of the activities prohibited by this section.

SEC. 248. ENFORCEMENT AUTHORITY.

    (a) In General.--
            (1) Definition.--In this subsection:
                    (A) the term ``employee'' means an employee 
                described in subparagraph (A) or (B) of section 244(3); 
                and
                    (B) the term ``employer'' means an employer 
                described in subclause (I) or (II) of section 
                244(4)(A)(i).
            (2) Investigative authority.--
                    (A) In general.--To ensure compliance with the 
                provisions of this subtitle, or any regulation or order 
                issued under this subtitle, the Secretary shall have, 
                subject to subparagraph (C), the investigative 
                authority provided under section 11(a) of the Fair 
                Labor Standards Act of 1938 (29 U.S.C. 211(a)), with 
                respect to employers, employees, and other individuals 
                affected.
                    (B) Obligation to keep and preserve records.--An 
                employer shall make, keep, and preserve records 
                pertaining to compliance with this subtitle in 
                accordance with section 11(c) of the Fair Labor 
                Standards Act of 1938 (29 U.S.C. 211(c)) and in 
                accordance with regulations prescribed by the 
                Secretary.
                    (C) Required submissions generally limited to an 
                annual basis.--The Secretary shall not require, under 
                the authority of this paragraph, an employer to submit 
                to the Secretary any books or records more than once 
                during any 12-month period, unless the Secretary has 
                reasonable cause to believe there may exist a violation 
                of this subtitle or any regulation or order issued 
                pursuant to this subtitle, or is investigating a charge 
                pursuant to paragraph (4).
                    (D) Subpoena authority.--For the purposes of any 
                investigation provided for in this paragraph, the 
                Secretary shall have the subpoena authority provided 
                for under section 9 of the Fair Labor Standards Act of 
                1938 (29 U.S.C. 209).
            (3) Civil action by employees or individuals.--
                    (A) Right of action.--An action to recover the 
                damages or equitable relief prescribed in subparagraph 
                (B) may be maintained against any employer in any 
                Federal or State court of competent jurisdiction by one 
                or more employees or individuals or their 
                representative for and on behalf of--
                            (i) the employees or individuals; or
                            (ii) the employees or individuals and 
                        others similarly situated.
                    (B) Liability.--Any employer who violates section 
                247 (including a violation relating to rights provided 
                under section 245) shall be liable to any employee or 
                individual affected--
                            (i) for damages equal to--
                                    (I) the amount of--
                                            (aa) any wages, salary, 
                                        employment benefits, or other 
                                        compensation denied or lost by 
                                        reason of the violation; or
                                            (bb) in a case in which 
                                        wages, salary, employment 
                                        benefits, or other compensation 
                                        have not been denied or lost, 
                                        any actual monetary losses 
                                        sustained as a direct result of 
                                        the violation up to a sum equal 
                                        to 56 hours of wages or salary 
                                        for the employee or individual;
                                    (II) the interest on the amount 
                                described in subclause (I) calculated 
                                at the prevailing rate; and
                                    (III) an additional amount as 
                                liquidated damages; and
                            (ii) for such equitable relief as may be 
                        appropriate, including employment, 
                        reinstatement, and promotion.
                    (C) Fees and costs.--The court in an action under 
                this paragraph shall, in addition to any judgment 
                awarded to the plaintiff, allow a reasonable attorney's 
                fee, reasonable expert witness fees, and other costs of 
                the action to be paid by the defendant.
            (4) Action by the secretary.--
                    (A) Administrative action.--The Secretary shall 
                receive, investigate, and attempt to resolve complaints 
                of violations of section 247 (including a violation 
                relating to rights provided under section 245) in the 
                same manner that the Secretary receives, investigates, 
                and attempts to resolve complaints of violations of 
                sections 6 and 7 of the Fair Labor Standards Act of 
                1938 (29 U.S.C. 206 and 207).
                    (B) Civil action.--The Secretary may bring an 
                action in any court of competent jurisdiction to 
                recover the damages described in paragraph (3)(B)(i).
                    (C) Sums recovered.--Any sums recovered by the 
                Secretary pursuant to subparagraph (B) shall be held in 
                a special deposit account and shall be paid, on order 
                of the Secretary, directly to each employee or 
                individual affected. Any such sums not paid to an 
                employee or individual affected because of inability to 
                do so within a period of 3 years shall be deposited 
                into the Treasury of the United States as miscellaneous 
                receipts.
            (5) Limitation.--
                    (A) In general.--Except as provided in subparagraph 
                (B), an action may be brought under paragraph (3), (4), 
                or (6) not later than 2 years after the date of the 
                last event constituting the alleged violation for which 
                the action is brought.
                    (B) Willful violation.--In the case of an action 
                brought for a willful violation of section 247 
                (including a willful violation relating to rights 
                provided under section 245), such action may be brought 
                within 3 years of the date of the last event 
                constituting the alleged violation for which such 
                action is brought.
                    (C) Commencement.--In determining when an action is 
                commenced under paragraph (3), (4), or (6) for the 
                purposes of this paragraph, it shall be considered to 
                be commenced on the date when the complaint is filed.
            (6) Action for injunction by secretary.--The district 
        courts of the United States shall have jurisdiction, for cause 
        shown, in an action brought by the Secretary--
                    (A) to restrain violations of section 247 
                (including a violation relating to rights provided 
                under section 245), including the restraint of any 
                withholding of payment of wages, salary, employment 
                benefits, or other compensation, plus interest, found 
                by the court to be due to employees or individuals 
                eligible under this subtitle; or
                    (B) to award such other equitable relief as may be 
                appropriate, including employment, reinstatement, and 
                promotion.
            (7) Solicitor of labor.--The Solicitor of Labor may appear 
        for and represent the Secretary on any litigation brought under 
        paragraph (4) or (6).
            (8) Government accountability office and library of 
        congress.--Notwithstanding any other provision of this 
        subsection, in the case of the Government Accountability Office 
        and the Library of Congress, the authority of the Secretary of 
        Labor under this subsection shall be exercised respectively by 
        the Comptroller General of the United States and the Librarian 
        of Congress.
    (b) Employees Covered by Congressional Accountability Act of 
1995.--The powers, remedies, and procedures provided in the 
Congressional Accountability Act of 1995 (2 U.S.C. 1301 et seq.) to the 
Board (as defined in section 101 of that Act (2 U.S.C. 1301)), or any 
person, alleging a violation of section 202(a)(1) of that Act (2 U.S.C. 
1312(a)(1)) shall be the powers, remedies, and procedures this subtitle 
provides to that Board, or any person, alleging an unlawful employment 
practice in violation of this subtitle against an employee described in 
section 244(3)(C).
    (c) Employees Covered by Chapter 5 of Title 3, United States 
Code.--The powers, remedies, and procedures provided in chapter 5 of 
title 3, United States Code, to the President, the Merit Systems 
Protection Board, or any person, alleging a violation of section 
412(a)(1) of that title, shall be the powers, remedies, and procedures 
this subtitle provides to the President, that Board, or any person, 
respectively, alleging an unlawful employment practice in violation of 
this subtitle against an employee described in section 244(3)(D).
    (d) Employees Covered by Chapter 63 of Title 5, United States 
Code.--The powers, remedies, and procedures provided in title 5, United 
States Code, to an employing agency, provided in chapter 12 of that 
title to the Merit Systems Protection Board, or provided in that title 
to any person, alleging a violation of chapter 63 of that title, shall 
be the powers, remedies, and procedures this subtitle provides to that 
agency, that Board, or any person, respectively, alleging an unlawful 
employment practice in violation of this subtitle against an employee 
described in section 244(3)(E).
    (e) Remedies for State Employees.--
            (1) Waiver of sovereign immunity.--A State's receipt or use 
        of Federal financial assistance for any program or activity of 
        a State shall constitute a waiver of sovereign immunity, under 
        the 11th Amendment to the Constitution or otherwise, to a suit 
        brought by an employee of that program or activity under this 
        subtitle for equitable, legal, or other relief authorized under 
        this subtitle.
            (2) Official capacity.--An official of a State may be sued 
        in the official capacity of the official by any employee who 
        has complied with the procedures under subsection (a)(3), for 
        injunctive relief that is authorized under this subtitle. In 
        such a suit the court may award to the prevailing party those 
        costs authorized by section 722 of the Revised Statutes (42 
        U.S.C. 1988).
            (3) Applicability.--With respect to a particular program or 
        activity, paragraph (1) applies to conduct occurring on or 
        after the day, after the date of enactment of this Act, on 
        which a State first receives or uses Federal financial 
        assistance for that program or activity.
            (4) Definition of program or activity.--In this subsection, 
        the term ``program or activity'' has the meaning given the term 
        in section 606 of the Civil Rights Act of 1964 (42 U.S.C. 
        2000d-4a).

SEC. 249. COLLECTION OF DATA ON PAID SICK TIME AND FURTHER STUDY.

    (a) Compilation of Information.--Effective 90 days after the date 
of enactment of this Act, the Commissioner of Labor Statistics shall 
annually compile information on the following:
            (1) The number of employees who used paid sick time.
            (2) The number of hours of paid sick time used.
            (3) The number of employees who used paid sick time for 
        absences necessary due to domestic violence, sexual assault, or 
        stalking.
            (4) The demographic characteristics of employees who were 
        eligible for and who used paid sick time.
    (b) GAO Study.--
            (1) In general.--The Comptroller General of the United 
        States shall annually conduct a study to determine the 
        following:
                    (A)(i) The number of days employees used paid sick 
                time and the reasons for the use.
                    (ii) The number of employees who used the paid sick 
                time for periods of time covering more than 3 
                consecutive workdays.
                    (B) The cost and benefits to employers of 
                implementing the paid sick time policies.
                    (C) The cost to employees of providing 
                certification to obtain the paid sick time.
                    (D) The benefits of the paid sick time to employees 
                and their family members, including effects on 
                employees' ability to care for their family members or 
                to provide for their own health needs.
                    (E) Whether the paid sick time affected employees' 
                ability to sustain an adequate income while meeting 
                needs of the employees and their family members.
                    (F) Whether employers who administered paid sick 
                time policies prior to the date of enactment of this 
                Act were affected by the provisions of this subtitle.
                    (G) Whether other types of leave were affected by 
                this subtitle.
                    (H) Whether paid sick time affected retention and 
                turnover and costs of presenteeism.
                    (I) Whether the paid sick time increased the use of 
                less costly preventive medical care and lowered the use 
                of emergency room care.
                    (J) Whether the paid sick time reduced the number 
                of children sent to school when the children were sick.
            (2) Aggregating data.--The data collected under 
        subparagraphs (A) and (D) of paragraph (1) shall be aggregated 
        by gender, race, disability, earnings level, age, marital 
        status, family type, including parental status, and industry.
            (3) Reports.--
                    (A) In general.--Not later than 18 months after the 
                date of enactment of this Act, the Comptroller General 
                of the United States shall prepare and submit a report 
                to the appropriate committees of Congress concerning 
                the results of the study conducted pursuant to 
                paragraph (1) and the data aggregated under paragraph 
                (2).
                    (B) Followup report.--Not later than 5 years after 
                the date of enactment of this Act, the Comptroller 
                General of the United States shall prepare and submit a 
                followup report to the appropriate committees of 
                Congress concerning the results of the study conducted 
                pursuant to paragraph (1) and the data aggregated under 
                paragraph (2).

SEC. 250. EFFECT ON OTHER LAWS.

    (a) Federal and State Antidiscrimination Laws.--Nothing in this 
subtitle shall be construed to modify or affect any Federal or State 
law prohibiting discrimination on the basis of race, religion, color, 
national origin, sex, age, or disability.
    (b) State and Local Laws.--Nothing in this subtitle shall be 
construed to supersede (including preempting) any provision of any 
State or local law that provides greater paid sick time or leave rights 
(including greater paid sick time or leave, or greater coverage of 
those eligible for paid sick time or leave) than the rights established 
under this subtitle.

SEC. 251. EFFECT ON EXISTING EMPLOYMENT BENEFITS.

    (a) More Protective.--Nothing in this subtitle shall be construed 
to diminish the obligation of an employer to comply with any contract, 
collective bargaining agreement, or any employment benefit program or 
plan that provides greater paid sick leave or other leave rights to 
employees or individuals than the rights established under this 
subtitle.
    (b) Less Protective.--The rights established for employees under 
this subtitle shall not be diminished by any contract, collective 
bargaining agreement, or any employment benefit program or plan.

SEC. 252. ENCOURAGEMENT OF MORE GENEROUS LEAVE POLICIES.

    Nothing in this subtitle shall be construed to discourage employers 
from adopting or retaining leave policies more generous than policies 
that comply with the requirements of this subtitle.

SEC. 253. REGULATIONS.

    (a) In General.--
            (1) Authority.--Except as provided in paragraph (2), not 
        later than 180 days after the date of enactment of this Act, 
        the Secretary shall prescribe such regulations as are necessary 
        to carry out this subtitle with respect to employees described 
        in subparagraph (A) or (B) of section 244(3) and other 
        individuals affected by employers described in subclause (I) or 
        (II) of section 244(4)(A)(i).
            (2) Government accountability office; library of 
        congress.--The Comptroller General of the United States and the 
        Librarian of Congress shall prescribe the regulations with 
        respect to employees of the Government Accountability Office 
        and the Library of Congress, respectively, and other 
        individuals affected by the Comptroller General of the United 
        States and the Librarian of Congress, respectively.
    (b) Employees Covered by Congressional Accountability Act of 
1995.--
            (1) Authority.--Not later than 120 days after the date of 
        enactment of this Act, the Board of Directors of the Office of 
        Compliance shall prescribe (in accordance with section 304 of 
        the Congressional Accountability Act of 1995 (2 U.S.C. 1384)) 
        such regulations as are necessary to carry out this subtitle 
        with respect to employees described in section 244(3)(C) and 
        other individuals affected by employers described in section 
        244(4)(A)(i)(III).
            (2) Agency regulations.--The regulations prescribed under 
        paragraph (1) shall be the same as substantive regulations 
        promulgated by the Secretary to carry out this subtitle except 
        insofar as the Board may determine, for good cause shown and 
        stated together with the regulations prescribed under paragraph 
        (1), that a modification of such regulations would be more 
        effective for the implementation of the rights and protections 
        involved under this section.
    (c) Employees Covered by Chapter 5 of Title 3, United States 
Code.--
            (1) Authority.--Not later than 120 days after the date of 
        enactment of this Act, the President (or the designee of the 
        President) shall prescribe such regulations as are necessary to 
        carry out this subtitle with respect to employees described in 
        section 244(3)(D) and other individuals affected by employers 
        described in section 244(4)(A)(i)(IV).
            (2) Agency regulations.--The regulations prescribed under 
        paragraph (1) shall be the same as substantive regulations 
        promulgated by the Secretary to carry out this subtitle except 
        insofar as the President (or designee) may determine, for good 
        cause shown and stated together with the regulations prescribed 
        under paragraph (1), that a modification of such regulations 
        would be more effective for the implementation of the rights 
        and protections involved under this section.
    (d) Employees Covered by Chapter 63 of Title 5, United States 
Code.--
            (1) Authority.--Not later than 120 days after the date of 
        enactment of this Act, the Director of the Office of Personnel 
        Management shall prescribe such regulations as are necessary to 
        carry out this subtitle with respect to employees described in 
        section 244(3)(E) and other individuals affected by employers 
        described in section 244(4)(A)(i)(V).
            (2) Agency regulations.--The regulations prescribed under 
        paragraph (1) shall be the same as substantive regulations 
        promulgated by the Secretary to carry out this subtitle except 
        insofar as the Director may determine, for good cause shown and 
        stated together with the regulations prescribed under paragraph 
        (1), that a modification of such regulations would be more 
        effective for the implementation of the rights and protections 
        involved under this section.

SEC. 254. EFFECTIVE DATES.

    (a) Effective Date.--This subtitle shall take effect 6 months after 
the date of issuance of regulations under section 253(a)(1).
    (b) Collective Bargaining Agreements.--In the case of a collective 
bargaining agreement in effect on the effective date prescribed by 
subsection (a), this subtitle shall take effect on the earlier of--
            (1) the date of the termination of such agreement; or
            (2) the date that occurs 18 months after the date of 
        issuance of regulations under section 253(a)(1).

              Subtitle E--Establishing a Fair Minimum Wage

SEC. 261. MINIMUM WAGE INCREASES.

    (a) Minimum Wage.--
            (1) In general.--Section 6(a)(1) of the Fair Labor 
        Standards Act of 1938 (29 U.S.C. 206(a)(1)) is amended to read 
        as follows:
            ``(1) except as otherwise provided in this section, not 
        less than--
                    ``(A) $8.10 an hour, beginning on the first day of 
                the third month that begins after the date of enactment 
                of the Rebuild America Act;
                    ``(B) $8.95 an hour, beginning 1 year after that 
                first day;
                    ``(C) $9.80 an hour, beginning 2 years after that 
                first day; and
                    ``(D) beginning on the date that is 3 years after 
                that first day, and annually thereafter, the amount 
                determined by the Secretary pursuant to subsection 
                (h);''.
            (2) Determination based on increase in the consumer price 
        index.--Section 6 of the Fair Labor Standards Act of 1938 (29 
        U.S.C. 206) is amended by adding at the end the following:
    ``(h)(1) Each year, by not later than the date that is 90 days 
before a new minimum wage determined under subsection (a)(1)(D) is to 
take effect, the Secretary shall determine the minimum wage to be in 
effect pursuant to this subsection for the subsequent 1-year period. 
The wage determined pursuant to this subsection for a year shall be--
            ``(A) not less than the amount in effect under subsection 
        (a)(1) on the date of such determination;
            ``(B) increased from such amount by the annual percentage 
        increase in the Consumer Price Index for Urban Wage Earners and 
        Clerical Workers (United States city average, all items, not 
        seasonally adjusted), or its successor publication, as 
        determined by the Bureau of Labor Statistics; and
            ``(C) rounded to the nearest multiple of $0.05.
    ``(2) In calculating the annual percentage increase in the Consumer 
Price Index for purposes of paragraph (1)(B), the Secretary shall 
compare such Consumer Price Index for the most recent month, quarter, 
or year available (as selected by the Secretary prior to the first year 
for which a minimum wage is in effect pursuant to this subsection) with 
the Consumer Price Index for the same month in the preceding year, the 
same quarter in the preceding year, or the preceding year, 
respectively.''.
    (b) Base Minimum Wage for Tipped Employees.--Section 3(m)(1) of the 
Fair Labor Standards Act of 1938 (29 U.S.C. 203(m)(1)) is amended to 
read as follows:
            ``(1) the cash wage paid such employee, which for purposes 
        of such determination shall be not less than--
                    ``(A) for the 1-year period beginning on the first 
                day of the third month that begins after the date of 
                enactment of the Rebuild America Act, $3.00 an hour;
                    ``(B) for each succeeding 1-year period until the 
                hourly wage under this paragraph equals 70 percent of 
                the wage in effect under section 6(a)(1) for such 
                period, an hourly wage equal to the amount determined 
                under this paragraph for the preceding year, increased 
                by the lesser of--
                            ``(i) $0.85; or
                            ``(ii) the amount necessary for the wage in 
                        effect under this paragraph to equal 70 percent 
                        of the wage in effect under section 6(a)(1) for 
                        such period, rounded to the nearest multiple of 
                        $0.05; and
                    ``(C) for each succeeding 1-year period after the 
                year in which the hourly wage under this paragraph 
                first equals 70 percent of the wage in effect under 
                section 6(a)(1) for the same period, the amount 
                necessary to ensure that the wage in effect under this 
                paragraph remains equal to 70 percent of the wage in 
                effect under section 6(a)(1), rounded to the nearest 
                multiple of $0.05; and''.
    (c) Publication of Notice.--Section 6 of the Fair Labor Standards 
Act of 1938 (as amended by subsection (a)) (29 U.S.C. 206) is further 
amended by adding at the end the following:
    ``(i) Not later than 60 days prior to the effective date of any 
increase in the minimum wage determined under subsection (h) or 
required for tipped employees in accordance with subparagraph (B) or 
(C) of section 3(m)(1), as amended by section 261 of the Rebuild 
America Act, the Secretary shall publish in the Federal Register and on 
the website of the Department of Labor a notice announcing the adjusted 
required wage.''.
    (d) Effective Date.--The amendments made by subsections (a) and (b) 
shall take effect on the first day of the third month that begins after 
the date of enactment of this Act.

              Subtitle F--Empowering Hardworking Americans

SEC. 271. AMENDMENTS TO THE NATIONAL LABOR RELATIONS ACT.

    (a) Coverage.--
            (1) Supervisors.--Section 2(11) of the National Labor 
        Relations Act (29 U.S.C. 152(11)) is amended--
                    (A) by inserting ``and for a majority of the 
                individual's worktime'' after ``interest of the 
                employer'';
                    (B) by striking ``assign,''; and
                    (C) by striking ``or responsibly to direct them''.
            (2) Independent contractors.--Section 2 of the National 
        Labor Relations Act (29 U.S.C. 152) is amended by adding at the 
        end the following:
            ``(15) The term `independent contractor' means an 
        individual who performs services for an employer for 
        remuneration and for whom it is found, to the satisfaction of 
        the Board, that--
                    ``(A) the individual has been and will continue to 
                be free from direction and control of the employer, 
                both under the individual's contract of service and in 
                fact;
                    ``(B) the service is outside the usual course of 
                business of the employer; and
                    ``(C) the individual is customarily engaged in an 
                independently established trade, occupation, 
                profession, or business, both under the individual's 
                contract of service and in fact.''.
    (b) Remedies.--
            (1) In general.--Section 10(l) of the National Labor 
        Relations Act (29 U.S.C. 160(l)) is amended--
                    (A) in the first sentence--
                            (i) by inserting after ``charged that'' the 
                        following: ``any person that is an employer has 
                        engaged in an unfair labor practice within the 
                        meaning of section 8(a) which results in the 
                        discharge of an employee or other serious 
                        economic loss, or that''; and
                            (ii) by striking ``case of like character'' 
                        and inserting ``other cases described in this 
                        sentence''; and
                    (B) in the third sentence, by striking ``as it 
                deems just and proper, notwithstanding any other 
                provision of law:'' and inserting the following: ``to 
                protect the rights guaranteed by this Act, 
                notwithstanding any other provision of law. The 
                district court shall grant the relief requested if the 
                court finds that there is reasonable cause to believe 
                that the alleged violation of the Act has occurred and, 
                giving deference to the Board's expertise in labor 
                policy, there exists a reasonable probability that the 
                purposes of the Act will be frustrated unless temporary 
                relief is granted, or temporary relief is reasonably 
                necessary to preserve the effectiveness of the remedy 
                or forestall further violations:''.
            (2) Civil penalties.--Section 12 of the National Labor 
        Relations Act (29 U.S.C. 162) is amended--
                    (A) by striking ``sec. 12. Any'' and inserting the 
                following:

``SEC. 12. PENALTIES.

    ``(a) Criminal Penalties.--Any''; and
                    (B) by adding at the end the following:
    ``(b) Civil Penalties.--Any employer who engages in a violation of 
section 8 that results in the discharge of an employee or other serious 
economic loss, shall, in addition to any remedy ordered, be subject to 
a civil penalty not to exceed $20,000 for each violation. In 
determining the amount of any penalty under this subsection, the Board 
shall consider--
            ``(1) the gravity of the unfair labor practice;
            ``(2) the impact of the unfair labor practice on the 
        charging party, on other persons seeking to exercise rights 
        guaranteed by this Act, and on the public interest; and
            ``(3) the size of the employer.''.

      Subtitle G--Increasing Job Opportunities for Americans With 
                              Disabilities

SEC. 281. MODIFICATION OF WORK OPPORTUNITY CREDIT.

    (a) Qualified Disability Insurance Recipients Treated as Members of 
Targeted Groups.--
            (1) In general.--Paragraph (1) of section 51(d) of the 
        Internal Revenue Code of 1986 is amended by striking ``or'' at 
        the end of subparagraph (H), by striking the period at the end 
        of subparagraph (I) and inserting ``, or'', and by adding at 
        the end the following new subparagraph:
                    ``(J) a qualified disability insurance 
                recipient.''.
            (2) Qualified disability insurance recipient defined.--
        Subsection (d) of section 51 of such Code is amended by adding 
        at the end the following new paragraph:
            ``(15) Qualified disability insurance recipient.--The term 
        `qualified disability insurance recipient' means any individual 
        who is certified by the local designated agency as receiving 
        disability insurance benefits under title II of the Social 
        Security Act for any month ending within the 60-day period 
        ending on the hiring date.''.
    (b) Modification of Vocational Rehabilitation Referrals.--Section 
51(d)(6) of the Internal Revenue Code of 1986 is amended by striking 
subparagraphs (A) and (B) and inserting the following:
                    ``(A) having a physical or mental disability which, 
                for such individual, constitutes or results in a 
                substantial impediment to employment, and
                    ``(B)(i) having been referred to the employer upon 
                completion of (or while receiving) rehabilitative 
                services pursuant to--
                            ``(I) an individualized plan for employment 
                        under title I of the Rehabilitation Act of 
                        1973, or
                            ``(II) a program of vocational 
                        rehabilitation carried out under chapter 31 of 
                        title 38, United States Code, or
                            ``(III) an individual work plan developed 
                        and implemented by an employment network 
                        pursuant to subsection (g) of section 1148 of 
                        the Social Security Act with respect to which 
                        the requirements of such subsection are met, or
                    ``(ii) eligible to receive rehabilitative services 
                pursuant to a plan described in clause (i)(I) or a 
                program described in clause (i)(II) but not receiving 
                such services.''.
    (c) Increased Credit for Certain Disabled Workers.--Section 51 of 
the Internal Revenue Code of 1986 is amended by adding at the end the 
following new subsection:
    ``(l) Increased Credit for Certain Disabled Workers.--
            ``(1) In general.--In the case of any qualified disabled 
        worker, subsection (b) shall be applied by substituting--
                    ``(A) `2-year period' for `1-year period' in 
                paragraph (2), and
                    ``(B) `$30,000' for `$6,000' in paragraph (3).
            ``(2) Qualified disabled worker.--For purposes of this 
        subsection, the term `qualified disabled worker' means any 
        individual who is--
                    ``(A) a qualified SSI recipient who is certified by 
                the local designated agency as an individual who is 
                receiving benefits described in subsection (d)(9) as 
                the result of being a blind or disabled individual (as 
                defined in section 1614 of the Social Security Act),
                    ``(B) a qualified disability insurance recipient, 
                or
                    ``(C) a vocational rehabilitation referral.''.
    (d) Extension of Credit.--Subparagraph (B) of section 51(c)(4) of 
the Internal Revenue Code of 1986 is amended to read as follows:
                    ``(B) after December 31, 2015.''.
    (e) Reporting.--Section 51 of the Internal Revenue Code of 1986, as 
amended by subsection (c), is amended by adding at the end the 
following new subsection:
    ``(m) Reporting.--The Secretary of the Treasury shall require each 
taxpayer which is allowed a credit under this section to report--
            ``(1) the number of employees hired by the taxpayer who are 
        members of a targeted group,
            ``(2) the number of employees hired by the taxpayer who 
        have a disability,
            ``(3) the length of retention of employees who are members 
        of a targeted group, and
            ``(4) such other information as the Secretary may 
        require.''.
    (f) Effective Date.--The amendments made by this section shall 
apply to individuals who begin work for an employer after the date of 
the enactment of this Act.

       TITLE III--RESTORING BALANCE AND FAIRNESS TO THE TAX CODE

SEC. 300. AMENDMENT OF 1986 CODE.

    Except as otherwise expressly provided, whenever in this title an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision, the reference shall be considered to 
be made to a section or other provision of the Internal Revenue Code of 
1986.

              Subtitle A--Instituting the ``Buffett Rule''

SEC. 301. FAIR SHARE TAX ON HIGH-INCOME TAXPAYERS.

    (a) In General.--Subchapter A of chapter 1 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new part:

          ``PART VIII--FAIR SHARE TAX ON HIGH-INCOME TAXPAYERS

``Sec. 59B. Fair share tax.

``SEC. 59B. FAIR SHARE TAX.

    ``(a) General Rule.--
            ``(1) Phase-in of tax.--In the case of any high-income 
        taxpayer, there is hereby imposed for a taxable year (in 
        addition to any other tax imposed by this subtitle) a tax equal 
        to the product of--
                    ``(A) the amount determined under paragraph (2), 
                and
                    ``(B) a fraction (not to exceed 1)--
                            ``(i) the numerator of which is the excess 
                        of--
                                    ``(I) the taxpayer's adjusted gross 
                                income, over
                                    ``(II) the dollar amount in effect 
                                under subsection (c)(1), and
                            ``(ii) the denominator of which is the 
                        dollar amount in effect under subsection 
                        (c)(1).
            ``(2) Amount of tax.--The amount of tax determined under 
        this paragraph is an amount equal to the excess (if any) of--
                    ``(A) the tentative fair share tax for the taxable 
                year, over
                    ``(B) the excess of--
                            ``(i) the sum of--
                                    ``(I) the regular tax liability (as 
                                defined in section 26(b)) for the 
                                taxable year,
                                    ``(II) the tax imposed by section 
                                55 for the taxable year, plus
                                    ``(III) the payroll tax for the 
                                taxable year, over
                            ``(ii) the credits allowable under part IV 
                        of subchapter A (other than sections 27(a), 31, 
                        and 34).
    ``(b) Tentative Fair Share Tax.--For purposes of this section--
            ``(1) In general.--The tentative fair share tax for the 
        taxable year is 30 percent of the excess of--
                    ``(A) the adjusted gross income of the taxpayer, 
                over
                    ``(B) the modified charitable contribution 
                deduction for the taxable year.
            ``(2) Modified charitable contribution deduction.--For 
        purposes of paragraph (1)--
                    ``(A) In general.--The modified charitable 
                contribution deduction for any taxable year is an 
                amount equal to the amount which bears the same ratio 
                to the deduction allowable under section 170 (section 
                642(c) in the case of a trust or estate) for such 
                taxable year as--
                            ``(i) the amount of itemized deductions 
                        allowable under the regular tax (as defined in 
                        section 55) for such taxable year, determined 
                        after the application of section 68, bears to
                            ``(ii) such amount, determined before the 
                        application of section 68.
                    ``(B) Taxpayer must itemize.--In the case of any 
                individual who does not elect to itemize deductions for 
                the taxable year, the modified charitable contribution 
                deduction shall be zero.
    ``(c) High-Income Taxpayer.--For purposes of this section--
            ``(1) In general.--The term `high-income taxpayer' means, 
        with respect to any taxable year, any taxpayer (other than a 
        corporation) with an adjusted gross income for such taxable 
        year in excess of $1,000,000 (50 percent of such amount in the 
        case of a married individual who files a separate return).
            ``(2) Inflation adjustment.--
                    ``(A) In general.--In the case of a taxable year 
                beginning after 2013, the $1,000,000 amount under 
                paragraph (1) shall be increased by an amount equal 
                to--
                            ``(i) such dollar amount, multiplied by
                            ``(ii) the cost-of-living adjustment 
                        determined under section 1(f)(3) for the 
                        calendar year in which the taxable year begins, 
                        determined by substituting `calendar year 2012' 
                        for `calendar year 1992' in subparagraph (B) 
                        thereof.
                    ``(B) Rounding.--If any amount as adjusted under 
                subparagraph (A) is not a multiple of $10,000, such 
                amount shall be rounded to the next lowest multiple of 
                $10,000.
    ``(d) Payroll Tax.--For purposes of this section, the payroll tax 
for any taxable year is an amount equal to the excess of--
            ``(1) the taxes imposed on the taxpayer under sections 
        1401, 1411, 3101, 3201, and 3211(a) (to the extent such taxes 
        are attributable to the rate of tax in effect under section 
        3101) with respect to such taxable year or wages or 
        compensation received during the taxable year, over
            ``(2) the deduction allowable under section 164(f) for such 
        taxable year.
    ``(e) Special Rule for Estates and Trusts.--For purposes of this 
section, in the case of an estate or trust, adjusted gross income shall 
be computed in the manner described in section 67(e).
    ``(f) Not Treated as Tax Imposed by This Chapter for Certain 
Purposes.--The tax imposed under this section shall not be treated as 
tax imposed by this chapter for purposes of determining the amount of 
any credit under this chapter (other than the credit allowed under 
section 27(a)) or for purposes of section 55.''.
    (b) Conforming Amendment.--Section 26(b)(2) of such Code is amended 
by redesignating subparagraphs (C) through (X) as subparagraphs (D) 
through (Y), respectively, and by inserting after subparagraph (B) the 
following new subparagraph:
                    ``(C) section 59B (relating to fair share tax),''.
    (c) Clerical Amendment.--The table of parts for subchapter A of 
chapter 1 of such Code is amended by adding at the end the following 
new item:

        ``Part VIII. Fair Share Tax on High-Income Taxpayers.''.

    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2012.

     Subtitle B--Adopting a Wall Street Trading and Speculators Tax

SEC. 311. TRANSACTION TAX.

    (a) In General.--Chapter 36 of the Internal Revenue Code of 1986 is 
amended by inserting after subchapter B the following new subchapter:

              ``Subchapter C--Tax on Trading Transactions

``Sec. 4475. Tax on trading transactions.

``SEC. 4475. TAX ON TRADING TRANSACTIONS.

    ``(a) Imposition of Tax.--There is hereby imposed a tax on each 
covered transaction with respect to any security.
    ``(b) Rate of Tax.--The tax imposed under subsection (a) with 
respect to any covered transaction shall be 0.03 percent of the 
specified base amount with respect to such covered transaction.
    ``(c) Specified Base Amount.--For purposes of this section, the 
term `specified base amount' means--
            ``(1) except as provided in paragraph (2), the fair market 
        value of the security (determined as of the time of the covered 
        transaction), and
            ``(2) in the case of any payment described in subsection 
        (h), the amount of such payment.
    ``(d) Covered Transaction.--For purposes of this section, the term 
`covered transaction' means--
            ``(1) except as provided in paragraph (2), any purchase 
        if--
                    ``(A) such purchase occurs or is cleared on a 
                facility located in the United States, or
                    ``(B) the purchaser or seller is a United States 
                person, and
            ``(2) any transaction with respect to a security described 
        in subparagraph (D), (E), or (F) of subsection (e)(1), if--
                    ``(A) such security is traded or cleared on a 
                facility located in the United States, or
                    ``(B) any party with rights under such security is 
                a United States person.
    ``(e) Security and Other Definitions.--For purposes of this 
section--
            ``(1) In general.--The term `security' means--
                    ``(A) any share of stock in a corporation,
                    ``(B) any partnership or beneficial ownership 
                interest in a partnership or trust,
                    ``(C) any note, bond, debenture, or other evidence 
                of indebtedness,
                    ``(D) any evidence of an interest in, or a 
                derivative financial instrument with respect to, any 
                security or securities described in subparagraph (A), 
                (B), or (C),
                    ``(E) any derivative financial instrument with 
                respect to any currency or commodity, and
                    ``(F) any other derivative financial instrument any 
                payment with respect to which is calculated by 
                reference to any specified index.
            ``(2) Derivative financial instrument.--The term 
        `derivative financial instrument' includes any option, forward 
        contract, futures contract, notional principal contract, or any 
        similar financial instrument.
            ``(3) Specified index.--The term `specified index' means 
        any 1 or more of any combination of--
                    ``(A) a fixed rate, price, or amount, or
                    ``(B) a variable rate, price, or amount,   
        which is based on any current objectively determinable 
        information which is not within the control of any of the 
        parties to the contract or instrument and is not unique to any 
        of the parties' circumstances.
            ``(4) Treatment of exchanges.--
                    ``(A) In general.--An exchange shall be treated as 
                the sale of the property transferred and a purchase of 
                the property received by each party to the exchange.
                    ``(B) Certain deemed exchanges.--In the case of a 
                distribution treated as an exchange for stock under 
                section 302 or 331, the corporation making such 
                distribution shall be treated as having purchased such 
                stock for purposes of this section.
    ``(f) Exceptions.--
            ``(1) Exception for initial issues.--No tax shall be 
        imposed under subsection (a) on any covered transaction with 
        respect to the initial issuance of any security described in 
        subparagraph (A), (B), or (C) of subsection (e)(1).
            ``(2) Exception for certain traded short-term 
        indebtedness.--A note, bond, debenture, or other evidence of 
        indebtedness which--
                    ``(A) is traded on a trading facility located in 
                the United States, and
                    ``(B) has a fixed maturity of not more than 100 
                days,
        shall not be treated as described in subsection (e)(1)(C).
            ``(3) Exception for securities lending arrangements.--No 
        tax shall be imposed under subsection (a) on any covered 
        transaction with respect to which gain or loss is not 
        recognized by reason of section 1058.
    ``(g) By Whom Paid.--
            ``(1) In general.--The tax imposed by this section shall be 
        paid by--
                    ``(A) in the case of a transaction which occurs or 
                is cleared on a facility located in the United States, 
                such facility, and
                    ``(B) in the case of a purchase not described in 
                subparagraph (A) which is executed by a broker (as 
                defined in section 6045(c)(1)) which is a United States 
                person, such broker.
            ``(2) Special rules for direct, etc., transactions.--In the 
        case of any transaction to which paragraph (1) does not apply, 
        the tax imposed by this section shall be paid by--
                    ``(A) in the case of a transaction described in 
                subsection (d)(1)--
                            ``(i) the purchaser if the purchaser is a 
                        United States person, and
                            ``(ii) the seller if the purchaser is not a 
                        United States person, and
                    ``(B) in the case of a transaction described in 
                subsection (d)(2)--
                            ``(i) the payor if the payor is a United 
                        States person, and
                            ``(ii) the payee if the payor is not a 
                        United States person.
    ``(h) Certain Payments Treated as Separate Transactions.--Except as 
otherwise provided by the Secretary, any payment with respect to a 
security described in subparagraph (D), (E), or (F) of subsection 
(e)(1) shall be treated as a separate transaction for purposes of this 
section, including--
            ``(1) any net initial payment, net final or terminating 
        payment, or net periodical payment with respect to a notional 
        principal contract (or similar financial instrument),
            ``(2) any payment with respect to any forward contract (or 
        similar financial instrument), and
            ``(3) any premium paid with respect to any option (or 
        similar financial instrument).
    ``(i) Administration.--The Secretary shall carry out this section 
in consultation with the Securities and Exchange Commission and the 
Commodity Futures Trading Commission.
    ``(j) Guidance; Regulations.--The Secretary shall--
            ``(1) provide guidance regarding such information reporting 
        concerning covered transactions as the Secretary deems 
        appropriate, and
            ``(2) prescribe such regulations as are necessary or 
        appropriate to prevent avoidance of the purposes of this 
        section, including the use of non-United States persons in such 
        transactions.''.
    (b) Clerical Amendment.--The table of subchapters for chapter 36 of 
such Code is amended by inserting after the item relating to subchapter 
B the following new item:

``Subchapter C. Tax on trading transactions.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to transactions after December 31, 2012.

  Subtitle C--Ending Tax Breaks for Companies That Ship Jobs Overseas

SEC. 321. ALLOCATION OF EXPENSES AND TAXES ON BASIS OF REPATRIATION OF 
              FOREIGN INCOME.

    (a) In General.--Part III of subchapter N of chapter 1 of the 
Internal Revenue Code of 1986 is amended by inserting after subpart G 
the following new subpart:

``Subpart H--Special Rules for Allocation of Foreign-Related Deductions 
                        and Foreign Tax Credits

``Sec. 975. Deductions allocated to deferred foreign income may not 
                            offset United States source income.
``Sec. 976. Amount of foreign taxes computed on overall basis.
``Sec. 977. Application of subpart.

``SEC. 975. DEDUCTIONS ALLOCATED TO DEFERRED FOREIGN INCOME MAY NOT 
              OFFSET UNITED STATES SOURCE INCOME.

    ``(a) Current Year Deductions.--For purposes of this chapter, 
foreign-related deductions for any taxable year--
            ``(1) shall be taken into account for such taxable year 
        only to the extent that such deductions are allocable to 
        currently-taxed foreign income, and
            ``(2) to the extent not so allowed, shall be taken into 
        account in subsequent taxable years as provided in subsection 
        (b).
Foreign-related deductions shall be allocated to currently-taxed 
foreign income in the same proportion which currently-taxed foreign 
income bears to the sum of currently-taxed foreign income and deferred 
foreign income.
    ``(b) Deductions Related to Repatriated Deferred Foreign Income.--
            ``(1) In general.--If there is repatriated foreign income 
        for a taxable year, the portion of the previously deferred 
        deductions allocated to the repatriated foreign income shall be 
        taken into account for the taxable year as a deduction 
        allocated to income from sources outside the United States. Any 
        such amount shall not be included in foreign-related deductions 
        for purposes of applying subsection (a) to such taxable year.
            ``(2) Portion of previously deferred deductions.--For 
        purposes of paragraph (1), the portion of the previously 
        deferred deductions allocated to repatriated foreign income 
        is--
                    ``(A) the amount which bears the same proportion to 
                such deductions, as
                    ``(B) the repatriated income bears to the 
                previously deferred foreign income.
    ``(c) Definitions and Special Rule.--For purposes of this section--
            ``(1) Foreign-related deductions.--The term `foreign-
        related deductions' means the total amount of deductions and 
        expenses which would be allocated or apportioned to gross 
        income from sources without the United States for the taxable 
        year if both the currently-taxed foreign income and deferred 
        foreign income were taken into account.
            ``(2) Currently-taxed foreign income.--The term `currently-
        taxed foreign income' means the amount of gross income from 
        sources without the United States for the taxable year 
        (determined without regard to repatriated foreign income for 
        such year).
            ``(3) Deferred foreign income.--The term `deferred foreign 
        income' means the excess of--
                    ``(A) the amount that would be includible in gross 
                income under subpart F of this part for the taxable 
                year if--
                            ``(i) all controlled foreign corporations 
                        were treated as one controlled foreign 
                        corporation, and
                            ``(ii) all earnings and profits of all 
                        controlled foreign corporations were subpart F 
                        income (as defined in section 952), over
                    ``(B) the sum of--
                            ``(i) all dividends received during the 
                        taxable year from controlled foreign 
                        corporations, plus
                            ``(ii) amounts includible in gross income 
                        under section 951(a).
            ``(4) Previously deferred foreign income.--The term 
        `previously deferred foreign income' means the aggregate amount 
        of deferred foreign income for all prior taxable years to which 
        this part applies, determined as of the beginning of the 
        taxable year, reduced by the repatriated foreign income for all 
        such prior taxable years.
            ``(5) Repatriated foreign income.--The term `repatriated 
        foreign income' means the amount included in gross income on 
        account of distributions out of previously deferred foreign 
        income.
            ``(6) Previously deferred deductions.--The term `previously 
        deferred deductions' means the aggregate amount of foreign-
        related deductions not taken into account under subsection (a) 
        for all prior taxable years (determined as of the beginning of 
        the taxable year), reduced by any amounts taken into account 
        under subsection (b) for such prior taxable years.
            ``(7) Treatment of certain foreign taxes.--
                    ``(A) Paid by controlled foreign corporation.--
                Section 78 shall not apply for purposes of determining 
                currently-taxed foreign income and deferred foreign 
                income.
                    ``(B) Paid by taxpayer.--For purposes of 
                determining currently-taxed foreign income, gross 
                income from sources without the United States shall be 
                reduced by the aggregate amount of taxes described in 
                the applicable paragraph of section 901(b) which are 
                paid by the taxpayer (without regard to sections 902 
                and 960) during the taxable year.
            ``(8) Coordination with section 976.--In determining 
        currently-taxed foreign income and deferred foreign income, the 
        amount of deemed foreign tax credits shall be determined with 
        regard to section 976.

``SEC. 976. AMOUNT OF FOREIGN TAXES COMPUTED ON OVERALL BASIS.

    ``(a) Current Year Allowance.--For purposes of this chapter, the 
amount taken into account as foreign income taxes for any taxable year 
shall be an amount which bears the same ratio to the total foreign 
income taxes for that taxable year as--
            ``(1) the currently-taxed foreign income for such taxable 
        year, bears to
            ``(2) the sum of the currently-taxed foreign income and 
        deferred foreign income for such year.
The portion of the total foreign income taxes for any taxable year not 
taken into account under the preceding sentence for a taxable year 
shall only be taken into account as provided in subsection (b) (and 
shall not be taken into account for purposes of applying sections 902 
and 960).
    ``(b) Allowance Related to Repatriated Deferred Foreign Income.--
            ``(1) In general.--If there is repatriated foreign income 
        for any taxable year, the portion of the previously deferred 
        foreign income taxes paid or accrued during such taxable year 
        shall be taken into account for the taxable year as foreign 
        taxes paid or accrued. Any such taxes so taken into account 
        shall not be included in foreign income taxes for purposes of 
        applying subsection (a) to such taxable year.
            ``(2) Portion of previously deferred foreign income 
        taxes.--For purposes of paragraph (1), the portion of the 
        previously deferred foreign income taxes allocated to 
        repatriated deferred foreign income is--
                    ``(A) the amount which bears the same proportion to 
                such taxes, as
                    ``(B) the repatriated deferred income bears to the 
                previously deferred foreign income.
    ``(c) Definitions and Special Rule.--For purposes of this section--
            ``(1) Previously deferred foreign income taxes.--The term 
        `previously deferred foreign income taxes' means the aggregate 
        amount of total foreign income taxes not taken into account 
        under subsection (a) for all prior taxable years (determined as 
        of the beginning of the taxable year), reduced by any amounts 
        taken into account under subsection (b) for such prior taxable 
        years.
            ``(2) Total foreign income taxes.--The term `total foreign 
        income taxes' means the sum of foreign income taxes paid or 
        accrued during the taxable year (determined without regard to 
        section 904(c)) plus the increase in foreign income taxes that 
        would be paid or accrued during the taxable year under sections 
        902 and 960 if--
                    ``(A) all controlled foreign corporations were 
                treated as one controlled foreign corporation, and
                    ``(B) all earnings and profits of all controlled 
                foreign corporations were subpart F income (as defined 
                in section 952).
            ``(3) Foreign income taxes.--The term `foreign income 
        taxes' means any income, war profits, or excess profits taxes 
        paid by the taxpayer to any foreign country or possession of 
        the United States.
            ``(4) Currently-taxed foreign income and deferred foreign 
        income.--The terms `currently-taxed foreign income' and 
        `deferred foreign income' have the meanings given such terms by 
        section 975(c)).

``SEC. 977. APPLICATION OF SUBPART.

    ``This subpart--
            ``(1) shall be applied before subpart A, and
            ``(2) shall be applied separately with respect to the 
        categories of income specified in section 904(d)(1).''.
    (b) Clerical Amendment.--The table of subparts for part III of 
subpart N of chapter 1 of such Code is amended by inserting after the 
item relating to subpart G the following new item:

``subpart h. special rules for allocation of foreign-related deductions 
                      and foreign tax credits.''.

    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2012.

SEC. 322. EXCESS INCOME FROM TRANSFERS OF INTANGIBLES TO LOW-TAXED 
              AFFILIATES TREATED AS SUBPART F INCOME.

    (a) In General.--Subsection (a) of section 954 of the Internal 
Revenue Code of 1986 is amended by inserting after paragraph (3) the 
following new paragraph:
            ``(4) the foreign base company excess intangible income for 
        the taxable year (determined under subsection (f) and reduced 
        as provided in subsection (b)(5)), and''.
    (b) Foreign Base Company Excess Intangible Income.--Section 954 of 
such Code is amended by inserting after subsection (e) the following 
new subsection:
    ``(f) Foreign Base Company Excess Intangible Income.--For purposes 
of subsection (a)(4) and this subsection:
            ``(1) Foreign base company excess intangible income 
        defined.--
                    ``(A) In general.--The term `foreign base company 
                excess intangible income' means, with respect to any 
                covered intangible, the excess of--
                            ``(i) the sum of--
                                    ``(I) gross income from the sale, 
                                lease, license, or other disposition of 
                                property in which such covered 
                                intangible is used directly or 
                                indirectly, and
                                    ``(II) gross income from the 
                                provision of services related to such 
                                covered intangible or in connection 
                                with property in which such covered 
                                intangible is used directly or 
                                indirectly, over
                            ``(ii) 150 percent of the costs properly 
                        allocated and apportioned to the gross income 
                        taken into account under clause (i) other than 
                        expenses for interest and taxes and any 
                        expenses which are not directly allocable to 
                        such gross income.
                    ``(B) Same country income not taken into account.--
                If--
                            ``(i) the sale, lease, license, or other 
                        disposition of the property referred to in 
                        subparagraph (A)(i)(I) is for use, consumption, 
                        or disposition in the country under the laws of 
                        which the controlled foreign corporation is 
                        created or organized, or
                            ``(ii) the services referred to in 
                        subparagraph (A)(i)(II) are performed in such 
                        country,
                the gross income from such sale, lease, license, or 
                other disposition, or provision of services, shall not 
                be taken into account under subparagraph (A)(i).
                    ``(C) Special rule for research and development 
                expenses.--Research and development costs for any 
                taxable year shall be treated for purposes of 
                subparagraph (A) as properly allocable to gross income 
                derived from a covered intangible if such costs are 
                properly allocable to the line of business in which 
                such gross income is earned.
            ``(2) Exception based on effective foreign income tax 
        rate.--
                    ``(A) In general.--Foreign base company excess 
                intangible income shall not include the applicable 
                percentage of any item of income received by a 
                controlled foreign corporation if the taxpayer 
                establishes to the satisfaction of the Secretary that 
                such income was subject to an effective rate of income 
                tax imposed by a foreign country in excess of 10 
                percent.
                    ``(B) Applicable percentage.--For purposes of 
                subparagraph (A), the term `applicable percentage' 
                means the ratio (expressed as a percentage), not 
                greater than 100 percent, of--
                            ``(i) the number of percentage points by 
                        which the effective rate of income tax referred 
                        to in subparagraph (A) exceeds 10 percentage 
                        points, over
                            ``(ii) 5 percentage points.
                    ``(C) Treatment of losses in determining effective 
                rate of foreign income tax.--For purposes of 
                determining the effective rate of income tax imposed by 
                any foreign country--
                            ``(i) such effective rate shall be 
                        determined without regard to any losses carried 
                        to the relevant taxable year, and
                            ``(ii) to the extent the income with 
                        respect to such intangible reduces losses in 
                        the relevant taxable year, such effective rate 
                        shall be treated as being the effective rate 
                        which would have been imposed on such income 
                        without regard to such losses.
            ``(3) Covered intangible.--The term `covered intangible' 
        means, with respect to any controlled foreign corporation, any 
        intangible property (as defined in section 936(h)(3)(B))--
                    ``(A) which is sold, leased, licensed, or otherwise 
                transferred (directly or indirectly) to such controlled 
                foreign corporation from a United States related 
                person, or
                    ``(B) with respect to which such controlled foreign 
                corporation and one or more related persons has 
                (directly or indirectly) entered into any shared risk 
                or development agreement (including any cost sharing 
                agreement).
            ``(4) Related person.--The term `related person' has the 
        meaning given such term in subsection (d)(3).''.
    (c) Conforming Amendments.--
            (1) Paragraph (4) of section 954(b) of such Code is amended 
        by inserting ``foreign base company excess intangible income 
        described in subsection (a)(4) or'' before ``foreign base 
        company oil-related income'' in the last sentence thereof.
            (2) Paragraph (5) of section 954(b) of such Code is amended 
        by inserting ``the foreign base company excess intangible 
        income,'' before ``and the foreign base company oil related 
        income''.
            (3) Subsection (b) of section 954 of such Code is amended 
        by adding at the end the following new paragraph:
            ``(7) Foreign base company excess intangible income not 
        treated as another kind of base company income.--Income of a 
        corporation which is foreign base company excess intangible 
        income shall not be considered foreign base company income of 
        such corporation under paragraph (2), (3), or (5) of subsection 
        (a).''.
    (d) Effective Date.--The amendments made by this section shall 
apply to income from transactions connected with or benefitting from 
covered intangibles in taxable years beginning on or after January 1, 
2013.

SEC. 323. MODIFICATIONS OF FOREIGN TAX CREDIT RULES APPLICABLE TO DUAL 
              CAPACITY TAXPAYERS.

    (a) In General.--Section 901 of the Internal Revenue Code of 1986 
is amended by redesignating subsection (n) as subsection (o) and by 
inserting after subsection (m) the following new subsection:
    ``(n) Special Rules Relating to Dual Capacity Taxpayers.--
            ``(1) General rule.--Notwithstanding any other provision of 
        this chapter, any amount paid or accrued by a dual capacity 
        taxpayer or any member of the worldwide affiliated group of 
        which such dual capacity taxpayer is also a member to any 
        foreign country or to any possession of the United States for 
        any period shall not be considered a tax to the extent such 
        amount exceeds the amount (determined in accordance with 
        regulations) which would have been required to be paid if the 
        taxpayer were not a dual capacity taxpayer.
            ``(2) Dual capacity taxpayer.--For purposes of this 
        subsection, the term `dual capacity taxpayer' means, with 
        respect to any foreign country or possession of the United 
        States, a person who--
                    ``(A) is subject to a levy of such country or 
                possession, and
                    ``(B) receives (or will receive) directly or 
                indirectly a specific economic benefit (as determined 
                in accordance with regulations) from such country or 
                possession.
            ``(3) Regulations.--The Secretary may issue such 
        regulations or other guidance as is necessary or appropriate to 
        carry out the purposes of this subsection.''.
    (b) Contrary Treaty Obligations Upheld.--The amendments made by 
this section shall not apply to the extent contrary to any treaty 
obligation of the United States.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts that, if such amounts were an amount of tax paid or 
accrued, would be considered paid or accrued in taxable years beginning 
after December 31, 2012.

           Subtitle D--Making Wall Street Take Responsibility

SEC. 331. FINANCIAL CRISIS RESPONSIBILITY FEE.

    (a) Amount To Be Collected.--In order to cover the costs to the 
Federal Government of assistance provided through the Emergency 
Economic Stabilization Act of 2008, including the Troubled Asset Relief 
Program, the Secretary of the Treasury, during the 10-year period 
beginning on the first day of fiscal year 2013 and continuing through 
the end of fiscal year 2022, shall assess a Financial Crisis 
Responsibility Fee to collect a total of $65,000,000,000.
    (b) Assessment and Schedule.--To collect the Financial Crisis 
Responsibility Fee, the Secretary of the Treasury shall establish, by 
regulation, an assessment schedule by fiscal year, including assessment 
base and rates, that--
            (1) is designed, in the judgment of the Secretary of the 
        Treasury, to result in the collection of $65,000,000,000; and
            (2) shall apply to any financial institution with 
        $50,000,000,000 or more in total consolidated assets that 
        received taxpayer assistance under the Emergency Economic 
        Stabilization Act of 2008, including the Troubled Asset Relief 
        Program.
    (c) Consideration of Economic Recovery.--To minimize any adverse 
impact to, and to promote the full recovery of, the economy and 
financial sector, the Secretary of the Treasury shall phase in the 
assessment rate required under this part over the 10-year period 
described in subsection (a), in a manner determined by the Secretary of 
the Treasury.

           Subtitle E--Closing the Carried Interest Loophole

SEC. 341. PARTNERSHIP INTERESTS TRANSFERRED IN CONNECTION WITH 
              PERFORMANCE OF SERVICES.

    (a) Modification to Election To Include Partnership Interest in 
Gross Income in Year of Transfer.--Subsection (c) of section 83 of the 
Internal Revenue Code of 1986 is amended by redesignating paragraph (4) 
as paragraph (5) and by inserting after paragraph (3) the following new 
paragraph:
            ``(4) Partnership interests.--Except as provided by the 
        Secretary--
                    ``(A) In general.--In the case of any transfer of 
                an interest in a partnership in connection with the 
                provision of services to (or for the benefit of) such 
                partnership--
                            ``(i) the fair market value of such 
                        interest shall be treated for purposes of this 
                        section as being equal to the amount of the 
                        distribution which the partner would receive if 
                        the partnership sold (at the time of the 
                        transfer) all of its assets at fair market 
                        value and distributed the proceeds of such sale 
                        (reduced by the liabilities of the partnership) 
                        to its partners in liquidation of the 
                        partnership, and
                            ``(ii) the person receiving such interest 
                        shall be treated as having made the election 
                        under subsection (b)(1) unless such person 
                        makes an election under this paragraph to have 
                        such subsection not apply.
                    ``(B) Election.--The election under subparagraph 
                (A)(ii) shall be made under rules similar to the rules 
                of subsection (b)(2).''.
    (b) Effective Date.--The amendments made by this section shall 
apply to interests in partnerships transferred after the date of the 
enactment of this Act.

SEC. 342. SPECIAL RULES FOR PARTNERS PROVIDING INVESTMENT MANAGEMENT 
              SERVICES TO PARTNERSHIPS.

    (a) In General.--Part I of subchapter K of chapter 1 of the 
Internal Revenue Code of 1986 is amended by adding at the end the 
following new section:

``SEC. 710. SPECIAL RULES FOR PARTNERS PROVIDING INVESTMENT MANAGEMENT 
              SERVICES TO PARTNERSHIPS.

    ``(a) Treatment of Distributive Share of Partnership Items.--For 
purposes of this title, in the case of an investment services 
partnership interest--
            ``(1) In general.--Notwithstanding section 702(b)--
                    ``(A) an amount equal to the net capital gain with 
                respect to such interest for any partnership taxable 
                year shall be treated as ordinary income, and
                    ``(B) subject to the limitation of paragraph (2), 
                an amount equal to the net capital loss with respect to 
                such interest for any partnership taxable year shall be 
                treated as an ordinary loss.
            ``(2) Recharacterization of losses limited to 
        recharacterized gains.--The amount treated as ordinary loss 
        under paragraph (1)(B) for any taxable year shall not exceed 
        the excess (if any) of--
                    ``(A) the aggregate amount treated as ordinary 
                income under paragraph (1)(A) with respect to the 
                investment services partnership interest for all 
                preceding partnership taxable years to which this 
                section applies, over
                    ``(B) the aggregate amount treated as ordinary loss 
                under paragraph (1)(B) with respect to such interest 
                for all preceding partnership taxable years to which 
                this section applies.
            ``(3) Allocation to items of gain and loss.--
                    ``(A) Net capital gain.--The amount treated as 
                ordinary income under paragraph (1)(A) shall be 
                allocated ratably among the items of long-term capital 
                gain taken into account in determining such net capital 
                gain.
                    ``(B) Net capital loss.--The amount treated as 
                ordinary loss under paragraph (1)(B) shall be allocated 
                ratably among the items of long-term capital loss and 
                short-term capital loss taken into account in 
                determining such net capital loss.
            ``(4) Terms relating to capital gains and losses.--For 
        purposes of this section--
                    ``(A) In general.--Net capital gain, long-term 
                capital gain, and long-term capital loss, with respect 
                to any investment services partnership interest for any 
                taxable year, shall be determined under section 1222, 
                except that such section shall be applied--
                            ``(i) without regard to the 
                        recharacterization of any item as ordinary 
                        income or ordinary loss under this section,
                            ``(ii) by only taking into account items of 
                        gain and loss taken into account by the holder 
                        of such interest under section 702 with respect 
                        to such interest for such taxable year, and
                            ``(iii) by treating property which is taken 
                        into account in determining gains and losses to 
                        which section 1231 applies as capital assets 
                        held for more than 1 year.
                    ``(B) Net capital loss.--The term `net capital 
                loss' means the excess of the losses from sales or 
                exchanges of capital assets over the gains from such 
                sales or exchanges. Rules similar to the rules of 
                clauses (i) through (iii) of subparagraph (A) shall 
                apply for purposes of the preceding sentence.
            ``(5) Special rules for dividends.--
                    ``(A) Individuals.--Any dividend allocated to any 
                investment services partnership interest shall not be 
                treated as qualified dividend income for purposes of 
                section 1(h).
                    ``(B) Corporations.--No deduction shall be allowed 
                under section 243 or 245 with respect to any dividend 
                allocated to any investment services partnership 
                interest.
            ``(6) Special rule for qualified small business stock.--
        Section 1202 shall not apply to any gain from the sale or 
        exchange of qualified small business stock (as defined in 
        section 1202(c)) allocated with respect to any investment 
        services partnership interest.
    ``(b) Dispositions of Partnership Interests.--
            ``(1) Gain.--
                    ``(A) In general.--Any gain on the disposition of 
                an investment services partnership interest shall be--
                            ``(i) treated as ordinary income, and
                            ``(ii) recognized notwithstanding any other 
                        provision of this subtitle.
                    ``(B) Gift and transfers at death.--In the case of 
                a disposition of an investment services partnership 
                interest by gift or by reason of death of the 
                taxpayer--
                            ``(i) subparagraph (A) shall not apply,
                            ``(ii) such interest shall be treated as an 
                        investment services partnership interest in the 
                        hands of the person acquiring such interest, 
                        and
                            ``(iii) any amount that would have been 
                        treated as ordinary income under this 
                        subsection had the decedent sold such interest 
                        immediately before death shall be treated as an 
                        item of income in respect of a decedent under 
                        section 691.
            ``(2) Loss.--Any loss on the disposition of an investment 
        services partnership interest shall be treated as an ordinary 
        loss to the extent of the excess (if any) of--
                    ``(A) the aggregate amount treated as ordinary 
                income under subsection (a) with respect to such 
                interest for all partnership taxable years to which 
                this section applies, over
                    ``(B) the aggregate amount treated as ordinary loss 
                under subsection (a) with respect to such interest for 
                all partnership taxable years to which this section 
                applies.
            ``(3) Election with respect to certain exchanges.--
        Paragraph (1)(A)(ii) shall not apply to the contribution of an 
        investment services partnership interest to a partnership in 
        exchange for an interest in such partnership if--
                    ``(A) the taxpayer makes an irrevocable election to 
                treat the partnership interest received in the exchange 
                as an investment services partnership interest, and
                    ``(B) the taxpayer agrees to comply with such 
                reporting and recordkeeping requirements as the 
                Secretary may prescribe.
            ``(4) Distributions of partnership property.--
                    ``(A) In general.--In the case of any distribution 
                of property by a partnership with respect to any 
                investment services partnership interest held by a 
                partner, the partner receiving such property shall 
                recognize gain equal to the excess (if any) of--
                            ``(i) the fair market value of such 
                        property at the time of such distribution, over
                            ``(ii) the adjusted basis of such property 
                        in the hands of such partner (determined 
                        without regard to subparagraph (C)).
                    ``(B) Treatment of gain as ordinary income.--Any 
                gain recognized by such partner under subparagraph (A) 
                shall be treated as ordinary income to the same extent 
                and in the same manner as the increase in such 
                partner's distributive share of the taxable income of 
                the partnership would be treated under subsection (a) 
                if, immediately prior to the distribution, the 
                partnership had sold the distributed property at fair 
                market value and all of the gain from such disposition 
                were allocated to such partner. For purposes of 
                applying subsection (a)(2), any gain treated as 
                ordinary income under this subparagraph shall be 
                treated as an amount treated as ordinary income under 
                subsection (a)(1)(A).
                    ``(C) Adjustment of basis.--In the case a 
                distribution to which subparagraph (A) applies, the 
                basis of the distributed property in the hands of the 
                distributee partner shall be the fair market value of 
                such property.
                    ``(D) Special rules with respect to mergers, 
                divisions, and technical terminations.--In the case of 
                a taxpayer which satisfies requirements similar to the 
                requirements of subparagraphs (A) and (B) of paragraph 
                (3), this paragraph and paragraph (1)(A)(ii) shall not 
                apply to the distribution of a partnership interest if 
                such distribution is in connection with a contribution 
                (or deemed contribution) of any property of the 
                partnership to which section 721 applies pursuant to a 
                transaction described in paragraph (1)(B) or (2) of 
                section 708(b).
    ``(c) Investment Services Partnership Interest.--For purposes of 
this section--
            ``(1) In general.--The term `investment services 
        partnership interest' means any interest in an investment 
        partnership acquired or held by any person in connection with 
        the conduct of a trade or business described in paragraph (2) 
        by such person (or any person related to such person). An 
        interest in an investment partnership held by any person--
                    ``(A) shall not be treated as an investment 
                services partnership interest for any period before the 
                first date on which it is so held in connection with 
                such a trade or business,
                    ``(B) shall not cease to be an investment services 
                partnership interest merely because such person holds 
                such interest other than in connection with such a 
                trade or business, and
                    ``(C) shall be treated as an investment services 
                partnership interest if acquired from a related person 
                in whose hands such interest was an investment services 
                partnership interest.
            ``(2) Businesses to which this section applies.--A trade or 
        business is described in this paragraph if such trade or 
        business primarily involves the performance of any of the 
        following services with respect to assets held (directly or 
        indirectly) by the investment partnership referred to in 
        paragraph (1):
                    ``(A) Advising as to the advisability of investing 
                in, purchasing, or selling any specified asset.
                    ``(B) Managing, acquiring, or disposing of any 
                specified asset.
                    ``(C) Arranging financing with respect to acquiring 
                specified assets.
                    ``(D) Any activity in support of any service 
                described in subparagraphs (A) through (C).
            ``(3) Investment partnership.--
                    ``(A) In general.--The term `investment 
                partnership' means any partnership if, at the end of 
                any calendar quarter ending after the date of enactment 
                of this section--
                            ``(i) substantially all of the assets of 
                        the partnership are specified assets 
                        (determined without regard to any section 197 
                        intangible within the meaning of section 
                        197(d)), and
                            ``(ii) more than half of the capital of the 
                        partnership is attributable to qualified 
                        capital interests which (in the hands of the 
                        owners of such interests) constitute property 
                        not held in connection with a trade or 
                        business.
                    ``(B) Special rules for determining if property not 
                held in connection with trade or business.--Except as 
                otherwise provided by the Secretary, for purposes of 
                determining whether any interest in a partnership 
                constitutes property not held in connection with a 
                trade or business under subparagraph (A)(ii)--
                            ``(i) any election under subsection (e) or 
                        (f) of section 475 shall be disregarded, and
                            ``(ii) paragraph (5)(B) shall not apply.
                    ``(C) Antiabuse rules.--The Secretary may issue 
                regulations or other guidance which prevent the 
                avoidance of the purposes of subparagraph (A), 
                including regulations or other guidance which treat 
                convertible and contingent debt (and other debt having 
                the attributes of equity) as a capital interest in the 
                partnership.
                    ``(D) Controlled groups of entities.--
                            ``(i) In general.--In the case of a 
                        controlled group of entities, if an interest in 
                        the partnership received in exchange for a 
                        contribution to the capital of the partnership 
                        by any member of such controlled group would 
                        (in the hands of such member) constitute 
                        property held in connection with a trade or 
                        business, then any interest in such partnership 
                        held by any member of such group shall be 
                        treated for purposes of subparagraph (A) as 
                        constituting (in the hands of such member) 
                        property held in connection with a trade or 
                        business.
                            ``(ii) Controlled group of entities.--For 
                        purposes of clause (i), the term `controlled 
                        group of entities' means a controlled group of 
                        corporations as defined in section 1563(a)(1), 
                        applied without regard to subsections (a)(4) 
                        and (b)(2) of section 1563. A partnership or 
                        any other entity (other than a corporation) 
                        shall be treated as a member of a controlled 
                        group of entities if such entity is controlled 
                        (within the meaning of section 954(d)(3)) by 
                        members of such group (including any entity 
                        treated as a member of such group by reason of 
                        this sentence).
                    ``(E) Special rule for corporations.--For purposes 
                of this paragraph, in the case of a corporation, the 
                determination of whether property is held in connection 
                with a trade or business shall be determined as if the 
                taxpayer were an individual.
            ``(4) Specified asset.--The term `specified asset' means 
        securities (as defined in section 475(c)(2) without regard to 
        the last sentence thereof), real estate held for rental or 
        investment, interests in partnerships, commodities (as defined 
        in section 475(e)(2)), cash or cash equivalents, or options or 
        derivative contracts with respect to any of the foregoing.
            ``(5) Related persons.--
                    ``(A) In general.--A person shall be treated as 
                related to another person if the relationship between 
                such persons is described in section 267(b) or 707(b).
                    ``(B) Attribution of partner services.--Any service 
                described in paragraph (2) which is provided by a 
                partner of a partnership shall be treated as also 
                provided by such partnership.
    ``(d) Exception for Certain Capital Interests.--
            ``(1) In general.--In the case of any portion of an 
        investment services partnership interest which is a qualified 
        capital interest, all items of gain and loss (and any 
        dividends) which are allocated to such qualified capital 
        interest shall not be taken into account under subsection (a) 
        if--
                    ``(A) allocations of items are made by the 
                partnership to such qualified capital interest in the 
                same manner as such allocations are made to other 
                qualified capital interests held by partners who do not 
                provide any services described in subsection (c)(2) and 
                who are not related to the partner holding the 
                qualified capital interest, and
                    ``(B) the allocations made to such other interests 
                are significant compared to the allocations made to 
                such qualified capital interest.
            ``(2) Authority to provide exceptions to allocation 
        requirements.--To the extent provided by the Secretary in 
        regulations or other guidance--
                    ``(A) Allocations to portion of qualified capital 
                interest.--Paragraph (1) may be applied separately with 
                respect to a portion of a qualified capital interest.
                    ``(B) No or insignificant allocations to nonservice 
                providers.--In any case in which the requirements of 
                paragraph (1)(B) are not satisfied, items of gain and 
                loss (and any dividends) shall not be taken into 
                account under subsection (a) to the extent that such 
                items are properly allocable under such regulations or 
                other guidance to qualified capital interests.
                    ``(C) Allocations to service providers' qualified 
                capital interests which are less than other 
                allocations.--Allocations shall not be treated as 
                failing to meet the requirement of paragraph (1)(A) 
                merely because the allocations to the qualified capital 
                interest represent a lower return than the allocations 
                made to the other qualified capital interests referred 
                to in such paragraph.
            ``(3) Special rule for changes in services and capital 
        contributions.--In the case of an interest in a partnership 
        which was not an investment services partnership interest and 
        which, by reason of a change in the services with respect to 
        assets held (directly or indirectly) by the partnership or by 
        reason of a change in the capital contributions to such 
        partnership, becomes an investment services partnership 
        interest, the qualified capital interest of the holder of such 
        partnership interest immediately after such change shall not, 
        for purposes of this subsection, be less than the fair market 
        value of such interest (determined immediately before such 
        change).
            ``(4) Special rule for tiered partnerships.--Except as 
        otherwise provided by the Secretary, in the case of tiered 
        partnerships, all items which are allocated in a manner which 
        meets the requirements of paragraph (1) to qualified capital 
        interests in a lower-tier partnership shall retain such 
        character to the extent allocated on the basis of qualified 
        capital interests in any upper-tier partnership.
            ``(5) Exception for no-self-charged carry and management 
        fee provisions.--Except as otherwise provided by the Secretary, 
        an interest shall not fail to be treated as satisfying the 
        requirement of paragraph (1)(A) merely because the allocations 
        made by the partnership to such interest do not reflect the 
        cost of services described in subsection (c)(2) which are 
        provided (directly or indirectly) to the partnership by the 
        holder of such interest (or a related person).
            ``(6) Special rule for dispositions.--In the case of any 
        investment services partnership interest any portion of which 
        is a qualified capital interest, subsection (b) shall not apply 
        to so much of any gain or loss as bears the same proportion to 
        the entire amount of such gain or loss as--
                    ``(A) the distributive share of gain or loss that 
                would have been allocated to the qualified capital 
                interest (consistent with the requirements of paragraph 
                (1)) if the partnership had sold all of its assets at 
                fair market value immediately before the disposition, 
                bears to
                    ``(B) the distributive share of gain or loss that 
                would have been so allocated to the investment services 
                partnership interest of which such qualified capital 
                interest is a part.
            ``(7) Qualified capital interest.--For purposes of this 
        section--
                    ``(A) In general.--The term `qualified capital 
                interest' means so much of a partner's interest in the 
                capital of the partnership as is attributable to--
                            ``(i) the fair market value of any money or 
                        other property contributed to the partnership 
                        in exchange for such interest (determined 
                        without regard to section 752(a)),
                            ``(ii) any amounts which have been included 
                        in gross income under section 83 with respect 
                        to the transfer of such interest, and
                            ``(iii) the excess (if any) of--
                                    ``(I) any items of income and gain 
                                taken into account under section 702 
                                with respect to such interest, over
                                    ``(II) any items of deduction and 
                                loss so taken into account.
                    ``(B) Adjustment to qualified capital interest.--
                            ``(i) Distributions and losses.--The 
                        qualified capital interest shall be reduced by 
                        distributions from the partnership with respect 
                        to such interest and by the excess (if any) of 
                        the amount described in subparagraph 
                        (A)(iii)(II) over the amount described in 
                        subparagraph (A)(iii)(I).
                            ``(ii) Special rule for contributions of 
                        property.--In the case of any contribution of 
                        property described in subparagraph (A)(i) with 
                        respect to which the fair market value of such 
                        property is not equal to the adjusted basis of 
                        such property immediately before such 
                        contribution, proper adjustments shall be made 
                        to the qualified capital interest to take into 
                        account such difference consistent with such 
                        regulations or other guidance as the Secretary 
                        may provide.
                    ``(C) Technical terminations, etc., disregarded.--
                No increase or decrease in the qualified capital 
                interest of any partner shall result from a 
                termination, merger, consolidation, or division 
                described in section 708, or any similar transaction.
            ``(8) Treatment of certain loans.--
                    ``(A) Proceeds of partnership loans not treated as 
                qualified capital interest of service providing 
                partners.--For purposes of this subsection, an 
                investment services partnership interest shall not be 
                treated as a qualified capital interest to the extent 
                that such interest is acquired in connection with the 
                proceeds of any loan or other advance made or 
                guaranteed, directly or indirectly, by any other 
                partner or the partnership (or any person related to 
                any such other partner or the partnership). The 
                preceding sentence shall not apply to the extent the 
                loan or other advance is repaid before the date of the 
                enactment of this section unless such repayment is made 
                with the proceeds of a loan or other advance described 
                in the preceding sentence.
                    ``(B) Reduction in allocations to qualified capital 
                interests for loans from nonservice-providing partners 
                to the partnership.--For purposes of this subsection, 
                any loan or other advance to the partnership made or 
                guaranteed, directly or indirectly, by a partner not 
                providing services described in subsection (c)(2) to 
                the partnership (or any person related to such partner) 
                shall be taken into account in determining the 
                qualified capital interests of the partners in the 
                partnership.
    ``(e) Other Income and Gain in Connection With Investment 
Management Services.--
            ``(1) In general.--If--
                    ``(A) a person performs (directly or indirectly) 
                investment management services for any investment 
                entity,
                    ``(B) such person holds (directly or indirectly) a 
                disqualified interest with respect to such entity, and
                    ``(C) the value of such interest (or payments 
                thereunder) is substantially related to the amount of 
                income or gain (whether or not realized) from the 
                assets with respect to which the investment management 
                services are performed,
        any income or gain with respect to such interest shall be 
        treated as ordinary income. Rules similar to the rules of 
        subsections (a)(5) and (d) shall apply for purposes of this 
        subsection.
            ``(2) Definitions.--For purposes of this subsection--
                    ``(A) Disqualified interest.--
                            ``(i) In general.--The term `disqualified 
                        interest' means, with respect to any investment 
                        entity--
                                    ``(I) any interest in such entity 
                                other than indebtedness,
                                    ``(II) convertible or contingent 
                                debt of such entity,
                                    ``(III) any option or other right 
                                to acquire property described in 
                                subclause (I) or (II), and
                                    ``(IV) any derivative instrument 
                                entered into (directly or indirectly) 
                                with such entity or any investor in 
                                such entity.
                            ``(ii) Exceptions.--Such term shall not 
                        include--
                                    ``(I) a partnership interest,
                                    ``(II) except as provided by the 
                                Secretary, any interest in a taxable 
                                corporation, and
                                    ``(III) except as provided by the 
                                Secretary, stock in an S corporation.
                    ``(B) Taxable corporation.--The term `taxable 
                corporation' means--
                            ``(i) a domestic C corporation, or
                            ``(ii) a foreign corporation substantially 
                        all of the income of which is--
                                    ``(I) effectively connected with 
                                the conduct of a trade or business in 
                                the United States, or
                                    ``(II) subject to a comprehensive 
                                foreign income tax (as defined in 
                                section 457A(d)(2)).
                    ``(C) Investment management services.--The term 
                `investment management services' means a substantial 
                quantity of any of the services described in subsection 
                (c)(2).
                    ``(D) Investment entity.--The term `investment 
                entity' means any entity which, if it were a 
                partnership, would be an investment partnership.
    ``(f) Regulations.--The Secretary shall prescribe such regulations 
or other guidance as is necessary or appropriate to carry out the 
purposes of this section, including regulations or other guidance to--
            ``(1) provide modifications to the application of this 
        section (including treating related persons as not related to 
        one another) to the extent such modification is consistent with 
        the purposes of this section,
            ``(2) prevent the avoidance of the purposes of this 
        section, and
            ``(3) coordinate this section with the other provisions of 
        this title.
    ``(g) Cross Reference.--For 40 percent penalty on certain 
underpayments due to the avoidance of this section, see section 
6662.''.
    (b) Application of Section 751 to Indirect Dispositions of 
Investment Services Partnership Interests.--
            (1) In general.--Subsection (a) of section 751 of such Code 
        is amended by striking ``or'' at the end of paragraph (1), by 
        inserting ``or'' at the end of paragraph (2), and by inserting 
        after paragraph (2) the following new paragraph:
            ``(3) investment services partnership interests held by the 
        partnership,''.
            (2) Certain distributions treated as sales or exchanges.--
        Subparagraph (A) of section 751(b)(1) of such Code is amended 
        by striking ``or'' at the end of clause (i), by inserting 
        ``or'' at the end of clause (ii), and by inserting after clause 
        (ii) the following new clause:
                            ``(iii) investment services partnership 
                        interests held by the partnership,''.
            (3) Application of special rules in the case of tiered 
        partnerships.--Subsection (f) of section 751 of such Code is 
        amended--
                    (A) by striking ``or'' at the end of paragraph (1), 
                by inserting ``or'' at the end of paragraph (2), and by 
                inserting after paragraph (2) the following new 
                paragraph:
            ``(3) an investment services partnership interest held by 
        the partnership,'', and
                    (B) by striking ``partner.'' and inserting 
                ``partner (other than a partnership in which it holds 
                an investment services partnership interest).''.
            (4) Investment services partnership interests; qualified 
        capital interests.--Section 751 of such Code is amended by 
        adding at the end the following new subsection:
    ``(g) Investment Services Partnership Interests.--For purposes of 
this section--
            ``(1) In general.--The term `investment services 
        partnership interest' has the meaning given such term by 
        section 710(c).
            ``(2) Adjustments for qualified capital interests.--The 
        amount to which subsection (a) applies by reason of paragraph 
        (3) thereof shall not include so much of such amount as is 
        attributable to any portion of the investment services 
        partnership interest which is a qualified capital interest 
        (determined under rules similar to the rules of section 
        710(d)).
            ``(3) Exception for publicly traded partnerships.--In the 
        case of an exchange of an interest in a publicly traded 
        partnership (as defined in section 7704) to which subsection 
        (a) applies--
                    ``(A) this section shall be applied without regard 
                to subsections (a)(3), (b)(1)(A)(iii), and (f)(3), and
                    ``(B) such partnership shall be treated as owning 
                its proportionate share of the property of any other 
                partnership in which it is a partner.
            ``(4) Recognition of gains.--Any gain with respect to which 
        subsection (a) applies by reason of paragraph (3) thereof shall 
        be recognized notwithstanding any other provision of this 
        title.
            ``(5) Coordination with inventory items.--An investment 
        services partnership interest held by the partnership shall not 
        be treated as an inventory item of the partnership.
            ``(6) Prevention of double counting.--Under regulations or 
        other guidance prescribed by the Secretary, subsection (a)(3) 
        shall not apply with respect to any amount to which section 710 
        applies.
            ``(7) Valuation methods.--The Secretary shall prescribe 
        regulations or other guidance which provide the acceptable 
        methods for valuing investment services partnership interests 
        for purposes of this section.''.
    (c) Treatment for Purposes of Section 7704.--Subsection (d) of 
section 7704 of such Code is amended by adding at the end the following 
new paragraph:
            ``(6) Income from certain carried interests not 
        qualified.--
                    ``(A) In general.--Specified carried interest 
                income shall not be treated as qualifying income.
                    ``(B) Specified carried interest income.--For 
                purposes of this paragraph--
                            ``(i) In general.--The term `specified 
                        carried interest income' means--
                                    ``(I) any item of income or gain 
                                allocated to an investment services 
                                partnership interest (as defined in 
                                section 710(c)) held by the 
                                partnership,
                                    ``(II) any gain on the disposition 
                                of an investment services partnership 
                                interest (as so defined) or a 
                                partnership interest to which (in the 
                                hands of the partnership) section 751 
                                applies, and
                                    ``(III) any income or gain taken 
                                into account by the partnership under 
                                subsection (b)(4) or (e) of section 
                                710.
                            ``(ii) Exception for qualified capital 
                        interests.--A rule similar to the rule of 
                        section 710(d) shall apply for purposes of 
                        clause (i).
                    ``(C) Coordination with other provisions.--
                Subparagraph (A) shall not apply to any item described 
                in paragraph (1)(E) (or so much of paragraph (1)(F) as 
                relates to paragraph (1)(E)).
                    ``(D) Special rules for certain partnerships.--
                            ``(i) Certain partnerships owned by real 
                        estate investment trusts.--Subparagraph (A) 
                        shall not apply in the case of a partnership 
                        which meets each of the following requirements:
                                    ``(I) Such partnership is treated 
                                as publicly traded under this section 
                                solely by reason of interests in such 
                                partnership being convertible into 
                                interests in a real estate investment 
                                trust which is publicly traded.
                                    ``(II) Fifty percent or more of the 
                                capital and profits interests of such 
                                partnership are owned, directly or 
                                indirectly, at all times during the 
                                taxable year by such real estate 
                                investment trust (determined with the 
                                application of section 267(c)).
                                    ``(III) Such partnership meets the 
                                requirements of paragraphs (2), (3), 
                                and (4) of section 856(c).
                            ``(ii) Certain partnerships owning other 
                        publicly traded partnerships.--Subparagraph (A) 
                        shall not apply in the case of a partnership 
                        which meets each of the following requirements:
                                    ``(I) Substantially all of the 
                                assets of such partnership consist of 
                                interests in one or more publicly 
                                traded partnerships (determined without 
                                regard to subsection (b)(2)).
                                    ``(II) Substantially all of the 
                                income of such partnership is ordinary 
                                income or section 1231 gain (as defined 
                                in section 1231(a)(3)).
                    ``(E) Transitional rule.--Subparagraph (A) shall 
                not apply to any taxable year of the partnership 
                beginning before the date which is 10 years after the 
                date of the enactment of this paragraph.''.
    (d) Imposition of Penalty on Underpayments.--
            (1) In general.--Subsection (b) of section 6662 of such 
        Code is amended by inserting after paragraph (7) the following 
        new paragraph:
            ``(8) The application of section 710(e) or the regulations 
        or other guidance prescribed under section 710(f) to prevent 
        the avoidance of the purposes of section 710.''.
            (2) Amount of penalty.--
                    (A) In general.--Section 6662 of such Code is 
                amended by adding at the end the following new 
                subsection:
    ``(k) Increase in Penalty in Case of Property Transferred for 
Investment Management Services.--In the case of any portion of an 
underpayment to which this section applies by reason of subsection 
(b)(8), subsection (a) shall be applied with respect to such portion by 
substituting `40 percent' for `20 percent'.''.
                    (B) Conforming amendment.--Subparagraph (B) of 
                section 6662A(e)(2) of such Code is amended by striking 
                ``or (i)'' and inserting ``, (i), or (k)''.
            (3) Special rules for application of reasonable cause 
        exception.--Subsection (c) of section 6664 of such Code is 
        amended--
                    (A) by redesignating paragraphs (3) and (4) as 
                paragraphs (4) and (5), respectively;
                    (B) by striking ``paragraph (3)'' in paragraph 
                (5)(A), as so redesignated, and inserting ``paragraph 
                (4)''; and
                    (C) by inserting after paragraph (2) the following 
                new paragraph:
            ``(3) Special rule for underpayments attributable to 
        investment management services.--
                    ``(A) In general.--Paragraph (1) shall not apply to 
                any portion of an underpayment to which section 6662 
                applies by reason of subsection (b)(8) unless--
                            ``(i) the relevant facts affecting the tax 
                        treatment of the item are adequately disclosed,
                            ``(ii) there is or was substantial 
                        authority for such treatment, and
                            ``(iii) the taxpayer reasonably believed 
                        that such treatment was more likely than not 
                        the proper treatment.
                    ``(B) Rules relating to reasonable belief.--Rules 
                similar to the rules of subsection (d)(3) shall apply 
                for purposes of subparagraph (A)(iii).''.
    (e) Income and Loss From Investment Services Partnership Interests 
Taken Into Account in Determining Net Earnings From Self-Employment.--
            (1) Internal revenue code.--
                    (A) In general.--Section 1402(a) of such Code is 
                amended by striking ``and'' at the end of paragraph 
                (16), by striking the period at the end of paragraph 
                (17) and inserting ``; and'', and by inserting after 
                paragraph (17) the following new paragraph:
            ``(18) notwithstanding the preceding provisions of this 
        subsection, in the case of any individual engaged in the trade 
        or business of providing services described in section 
        710(c)(2) with respect to any entity, investment services 
        partnership income or loss (as defined in subsection (m)) of 
        such individual with respect to such entity shall be taken into 
        account in determining the net earnings from self-employment of 
        such individual.''.
                    (B) Investment services partnership income or 
                loss.--Section 1402 of such Code is amended by adding 
                at the end the following new subsection:
    ``(m) Investment Services Partnership Income or Loss.--For purposes 
of subsection (a)--
            ``(1) In general.--The term `investment services 
        partnership income or loss' means, with respect to any 
        investment services partnership interest (as defined in section 
        710(c)) or disqualified interest (as defined in section 
        710(e)), the net of--
                    ``(A) the amounts treated as ordinary income or 
                ordinary loss under subsections (b) and (e) of section 
                710 with respect to such interest,
                    ``(B) all items of income, gain, loss, and 
                deduction allocated to such interest, and
                    ``(C) the amounts treated as realized from the sale 
                or exchange of property other than a capital asset 
                under section 751 with respect to such interest.
            ``(2) Exception for qualified capital interests.--A rule 
        similar to the rule of section 710(d) shall apply for purposes 
        of applying paragraph (1)(B).''.
            (2) Social security act.--Section 211(a) of the Social 
        Security Act is amended by striking ``and'' at the end of 
        paragraph (15), by striking the period at the end of paragraph 
        (16) and inserting ``; and'', and by inserting after paragraph 
        (16) the following new paragraph:
            ``(17) Notwithstanding the preceding provisions of this 
        subsection, in the case of any individual engaged in the trade 
        or business of providing services described in section 
        710(c)(2) of the Internal Revenue Code of 1986 with respect to 
        any entity, investment services partnership income or loss (as 
        defined in section 1402(m) of such Code) shall be taken into 
        account in determining the net earnings from self-employment of 
        such individual.''.
    (f) Conforming Amendments.--
            (1) Subsection (d) of section 731 of such Code is amended 
        by inserting ``section 710(b)(4) (relating to distributions of 
        partnership property),'' after ``to the extent otherwise 
        provided by''.
            (2) Section 741 of such Code is amended by inserting ``or 
        section 710 (relating to special rules for partners providing 
        investment management services to partnerships)'' before the 
        period at the end.
            (3) The table of sections for part I of subchapter K of 
        chapter 1 of such Code is amended by adding at the end the 
        following new item:

``Sec. 710. Special rules for partners providing investment management 
                            services to partnerships.''.
    (g) Effective Date.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        taxable years ending after the date of the enactment of this 
        Act.
            (2) Partnership taxable years which include effective 
        date.--In applying section 710(a) of the Internal Revenue Code 
        of 1986 (as added by this section) in the case of any 
        partnership taxable year which includes the date of the 
        enactment of this Act, the amount of the net capital gain 
        referred to in such section shall be treated as being the 
        lesser of the net capital gain for the entire partnership 
        taxable year or the net capital gain determined by only taking 
        into account items attributable to the portion of the 
        partnership taxable year which is after such date.
            (3) Dispositions of partnership interests.--
                    (A) In general.--Section 710(b) of such Code (as 
                added by this section) shall apply to dispositions and 
                distributions after the date of the enactment of this 
                Act.
                    (B) Indirect dispositions.--The amendments made by 
                subsection (b) shall apply to transactions after the 
                date of the enactment of this Act.
            (4) Other income and gain in connection with investment 
        management services.--Section 710(e) of such Code (as added by 
        this section) shall take effect on the date of the enactment of 
        this Act.

               Subtitle F--Raising the Capital Gains Rate

SEC. 351. INCREASED CAPITAL GAINS RATE FOR HIGH-INCOME INDIVIDUALS.

    (a) In General.--Paragraph (1) of section 1(h) of the Internal 
Revenue Code of 1986 is amended--
            (1) in subparagraph (C), by striking ``of the adjusted net 
        capital gain'' and all that follows and inserting ``of the 
        lesser of--
                            ``(i) so much of the adjusted net capital 
                        gain (or, if less, taxable income) as exceeds 
                        the amount on which a tax is determined under 
                        subparagraph (B), or
                            ``(ii) the excess (if any) of--
                                    ``(I) $50,000 ($100,000 in the case 
                                of a joint return), over
                                    ``(II) the sum of the amounts on 
                                which a tax is determined under 
                                subparagraphs (A) and (B), and'', and
            (2) by striking subparagraphs (D) and (E) and inserting the 
        following:
                    ``(D) the lesser of--
                            ``(i) 28 percent, or
                            ``(ii) the highest marginal tax rate 
                        determined under this section (determined 
                        without regard to this subsection) which would 
                        be imposed on the taxable income of the 
                        taxpayer in excess of the sum of the amount on 
                        which tax is determined under the preceding 
                        subparagraphs of this paragraph,
                multiplied by such amount of taxable income.''.
    (b) Minimum Tax.--Paragraph (3) of section 55(b) of such Code is 
amended--
            (1) in subparagraph (C), by striking ``of the adjusted net 
        capital gain'' and all that follows, and inserting ``of the 
        lesser of--
                            ``(i) so much of the adjusted net capital 
                        gain (or, if less, taxable excess) as exceeds 
                        the amount on which tax is determined under 
                        subparagraph (B), or''.
                            ``(ii) the excess described in section 
                        1(h)(1)(C)(ii), plus'', and
            (2) by striking subparagraphs (D) inserting the following:
                    ``(D) the lesser of--
                            ``(i) 28 percent, or
                            ``(ii) the highest marginal tax rate 
                        determined under section 1 (determined without 
                        regard to subsection (h)) which would be 
                        imposed on the taxable excess of the taxpayer 
                        in excess of the sum of the amount on which tax 
                        is determined under the preceding subparagraphs 
                        of this paragraph,
                multiplied by such amount of taxable excess.''.
    (c) Conforming Amendments.--
            (1) The following provisions of such Code are amended by 
        striking ``15 percent'' and inserting ``28 percent'':
                    (A) Section 1445(e)(1).
                    (B) The second sentence of section 7518(g)(6)(A).
                    (C) Section 53511(f)(2) of title 46, United States 
                Code.
            (2) Section 1445(e)(6) of such Code is amended by striking 
        ``15 percent (20 percent in the case of taxable years beginning 
        after December 31, 2010)'' and inserting ``28 percent''.
    (d) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to taxable years 
        beginning after December 31, 2012.
            (2) Withholding.--The amendments made by paragraphs (1)(A) 
        and (2) of subsection (c) shall apply to amounts paid on or 
        after January 1, 2013.

                Subtitle G--Pension Guaranty Improvement

SEC. 361. SHORT TITLE.

    This subtitle may be cited as the ``Pension Guaranty Improvement 
Act of 2012''.

SEC. 362. FINDINGS.

    Congress makes the following findings:
            (1) The Pension Benefit Guaranty Corporation (referred to 
        in this section as the ``Corporation'') plays a critical role 
        in helping to protect the retirement security of the 44,000,000 
        workers and retirees with defined benefit pension plans.
            (2) The Corporation has struggled over the years to address 
        deficiencies and implement long-term strategies for success.
            (3) The Corporation faces long-term fiscal challenges, 
        which have been exacerbated by the recent financial crisis.
            (4) It is necessary for Congress to take immediate steps to 
        improve the governance of the Corporation and ensure 
        appropriate oversight by, and accountability to, key 
        stakeholders, including labor, plan sponsors, and retirees.
            (5) It is further necessary to takes steps to ensure that 
        the guaranty provided by the Corporation is fair to 
        participants and that the Corporation has sufficient resources 
        to satisfy its obligations.

SEC. 363. PENSION BENEFIT GUARANTY CORPORATION GOVERNANCE IMPROVEMENT.

    (a) Board of Directors of the Pension Benefit Guaranty 
Corporation.--
            (1) In general.--Section 4002(d) of the Employee Retirement 
        Income Security Act of 1974 (29 U.S.C. 1302(d)) is amended to 
        read as follows:
    ``(d)(1) The board of directors of the corporation consists of--
            ``(A) the Secretary of the Treasury, the Secretary of 
        Labor, and the Secretary of Commerce; and
            ``(B) 4 other members.
    ``(2)(A) The members of the board of directors described under 
paragraph (1)(B)--
            ``(i) shall be appointed by the President; and
            ``(ii) shall have expertise relevant to business of the 
        corporation, which may include experience with insurance 
        programs, defined benefit pension plans, or institutional asset 
        management.
    ``(B) Except as provided in subparagraph (C)(ii), each member of 
the board of directors described under paragraph (1)(B) shall be 
appointed for a term of 4 years.
    ``(C)(i) The initial members of the board of directors described 
under paragraph (1)(B) shall be appointed as soon as practicable after 
the date of enactment of the Pension Guaranty Improvement Act of 2012.
    ``(ii) Of the initial members of the board of directors described 
under paragraph (1)(B) and appointed under clause (i)--
            ``(I) the term of one such member shall end on December 31, 
        2013;
            ``(II) the term of one such member shall end on December 
        31, 2014;
            ``(III) the term of one such member shall end on December 
        31, 2015; and
            ``(IV) the term of one such member shall end on December 
        31, 2016.
    ``(D)(i) Not more than 2 members of the board of directors 
described under paragraph (1)(B) may be members of the same political 
party.
    ``(ii) At least 1 member of the board of directors shall be an 
enrolled actuary or other financial expert.
    ``(iii) At least 1 member of the board of directors shall have 
experience with the issues unique to retired plan participants.
    ``(E)(i) Any vacancy on the board of directors shall be filled in 
the manner in which the original appointment was made.
    ``(ii) In the event of vacancy in the office of the Secretary of 
the Treasury, the Secretary of Labor, or the Secretary of Commerce and 
pending the appointment of a successor, or during the absence or 
disability of such a Secretary, the applicable acting Secretary shall 
be a member of the board of directors.
    ``(iii) A member of the board of directors appointed to fill a 
vacancy occurring before the expiration of the term for which the 
predecessor of such member was appointed shall be appointed for the 
remainder of such term.
    ``(iv) A member of the board of directors described under paragraph 
(1)(B) may continue to serve after the expiration of the term of office 
for which such member was appointed until a successor has been 
appointed.
    ``(F) A member of the board of directors described under paragraph 
(1)(B) may be removed for good cause by the President or by unanimous 
decision of the other members of the board of directors.
    ``(G) A majority of the members of the board of directors in office 
shall constitute a quorum for the transaction of business. The vote of 
the majority of the members present and voting at a meeting at which a 
quorum is present shall be the act of the board of directors.
    ``(3) Each member of the board of directors described under 
paragraph (1)(A) shall designate in writing an official, not below the 
level of Assistant Secretary, to serve as the voting representative of 
such member on the board. Such designation shall be effective until 
revoked or until a date or event specified therein. Any such 
representative may refer for board action any matter under 
consideration by the designating board member.
    ``(4) The members of the board of directors described under--
            ``(A) subparagraph (A) of paragraph (1), shall serve 
        without compensation, but shall be reimbursed for travel, 
        subsistence, and other necessary expenses incurred in the 
        performance of their duties as members of the board; and
            ``(B) subparagraph (B) of paragraph (1) shall, for each day 
        (including traveltime) during which they are attending meetings 
        or conferences of the board or otherwise engaged in the 
        business of the board, be compensated at a rate fixed by the 
        corporation which is not in excess of the daily equivalent of 
        the annual rate of basic pay for a position at level IV of the 
        Executive Schedule under section 5315 of title 5, United States 
        Code, and while away from their homes or regular places of 
        business they may be allowed travel expenses, including per 
        diem in lieu of subsistence, as authorized by section 5703 of 
        title 5, United States Code.
    ``(5)(A) The Secretary of Labor is the chairman of the board of 
directors.
    ``(B) The President shall designate 1 of the members appointed 
under paragraph (2) as the vice-chairman of the board of directors.
    ``(6) The Inspector General of the corporation shall report to the 
board of directors, and not less than twice a year, shall attend a 
meeting of the board of directors to provide a report on the activities 
and findings of the Inspector General, including with respect to 
monitoring and review of the operations of the corporation.
    ``(7) The General Counsel of the corporation shall--
            ``(A) serve as the secretary to the board of directors, and 
        shall advise such board as needed; and
            ``(B) have overall responsibility for all legal matters 
        affecting the corporation and provide the corporation with 
        legal advice and opinions on all matters of law affecting the 
        corporation, except that the authority of the General Counsel 
        shall not extend to the Office of Inspector General and the 
        independent legal counsel of such Office.
    ``(8) Notwithstanding any other provision of this Act, the Office 
of Inspector General and the legal counsel of such Office is 
independent of the management of the corporation and the General 
Counsel of the corporation.
    ``(9) The board of directors may appoint and fix the compensation 
of employees as may be required to enable the board of directors to 
perform its duties. The board of directors shall determine the 
qualifications and duties of such employees and may appoint and fix the 
compensation of experts and consultants in accordance with the 
provisions of section 3109 of title 5, United States Code.''.
            (2) Number of meetings; public availability.--Section 
        4002(e) of the Employee Retirement Income Security Act of 1974 
        (29 U.S.C. 1302(e)) is amended--
                    (A) by striking ``The board'' and inserting ``(1) 
                The board'';
                    (B) by striking ``the corporation.'' and inserting 
                ``the corporation, but in no case less than 4 times a 
                year with not less than 5 members present. Not less 
                than 1 meeting of the board of directors during each 
                year shall be a joint meeting with the advisory 
                committee under subsection (h).''; and
                    (C) by adding at the end the following:
    ``(2)(A) Except as provided in subparagraph (B), the chairman of 
the board of directors shall make available to the public the minutes 
from each meeting of the board of directors.
    ``(B) The minutes of a meeting of the board of directors, or a 
portion thereof, shall not be subject to disclosure under subparagraph 
(A) if the chairman reasonably determines that such minutes, or portion 
thereof, contain confidential information relating to financial 
activities or personnel decisions of the corporation.
    ``(C) The minutes of a meeting, or portion thereof, exempt from 
disclosure pursuant to subparagraph (B) shall be exempt from disclosure 
under section 552(b) of title 5, United States Code. For purposes of 
such section 552 of title 5, United States Code, this subparagraph 
shall be considered a statute described in subsection (b)(3) of such 
section 552.''.
            (3) Advisory committee.--
                    (A) Issues considered by the committee.--Section 
                4002(h)(1) of the Employee Retirement Income Security 
                Act of 1974 (29 U.S.C. 1302(h)(1)) is amended--
                            (i) by striking ``, and (D)'' and inserting 
                        ``, (D)''; and
                            (ii) by striking ``time to time.'' and 
                        inserting ``time to time, and (E) other issues 
                        as determined appropriate by the advisory 
                        committee.''.
                    (B) Joint meeting.--Section 4002(h)(3) of the 
                Employee Retirement Income Security Act of 1974 (29 
                U.S.C. 1302(h)(3)) is amended by adding at the end the 
                following: ``Not less than 1 meeting of the advisory 
                committee during each year shall be a joint meeting 
                with the board of directors under subsection (e).''.
    (b) Avoiding Conflicts of Interest.--Section 4002 of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C. 1302) is amended by 
adding at the end the following:
    ``(j) Conflicts of Interest.--
            ``(1) In general.--The Director of the corporation and each 
        member of the board of directors shall not participate in a 
        decision of the corporation in which the Director or such 
        member has a direct financial interest. The Director of the 
        corporation shall not participate in any activities that would 
        present a potential conflict of interest or appearance of a 
        conflict of interest without approval of the board of 
        directors.
            ``(2) Establishment of policy.--The board of directors 
        shall establish a policy that will inform the identification of 
        potential conflicts of interests of the members of the board of 
        directors and mitigate perceived conflicts of interest of such 
        members and the Director of the corporation.''.
    (c) Risk Mitigation.--Section 4002 of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1302), as amended by subsection 
(b), is further amended by adding at the end the following:
    ``(k) Risk Management Officer.--The corporation shall have a risk 
management officer whose duties include evaluating and mitigating the 
risk that the corporation might experience. The individual in such 
position shall coordinate the risk management efforts of the 
corporation, explain risks and controls to senior management and the 
board of directors of the corporation, and make recommendations.''.
    (d) Director.--Section 4002(c) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1302(c)) is amended to read as follows:
    ``(c) The Director shall be accountable to the board of directors. 
The Director shall serve for a term of 5 years unless removed by the 
President or the board of directors before the expiration of such 5-
year term.''.
    (e) Senses of Congress.--
            (1) Formation of committees.--It is the sense of Congress 
        that the board of directors of the Pension Benefit Guaranty 
        Corporation established under section 4002 of the Employee 
        Retirement Income Security Act of 1974 (29 U.S.C. 1302), as 
        amended by this section, should form committees, including an 
        audit committee and an investment committee, to enhance the 
        overall effectiveness of the board of directors.
            (2) Advisory committee.--It is the sense of Congress that 
        the advisory committee to the Pension Benefit Guaranty 
        Corporation established under section 4002 of the Employee 
        Retirement Income Security Act of 1974 (29 U.S.C. 1302), as 
        amended by this section, should provide to the board of 
        directors of such corporation policy recommendations regarding 
        changes to the law that would be beneficial to the corporation 
        or the voluntary private pension system.

SEC. 364. PARTICIPANT AND PLAN SPONSOR ADVOCATE.

    (a) In General.--Title IV of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1301 et seq.) is amended by inserting 
after section 4003 the following:

``SEC. 4004. PARTICIPANT AND PLAN SPONSOR ADVOCATE.

    ``(a) In General.--The Secretary of Labor, in consultation with the 
Director of the corporation and pension participant and plan sponsor 
advocacy groups, shall select a Participant and Plan Sponsor Advocate. 
Such selected individual shall have demonstrated experience in the area 
of pensions and pension participant assistance.
    ``(b) Duties.--The Participant and Plan Sponsor Advocate shall--
            ``(1) act as a liaison between the corporation, sponsors of 
        defined benefit pension plans insured by the corporation, and 
        participants in pension plans trusteed by the corporation;
            ``(2) advocate for the full attainment of the rights of 
        participants in plans trusteed by the corporation;
            ``(3) assist pension plan sponsors and participants in 
        resolving disputes with the corporation;
            ``(4) identify areas in which participants and plan 
        sponsors have persistent problems in dealings with the 
        corporation;
            ``(5) to the extent possible, propose changes in the 
        administrative practices of the corporation to mitigate 
        problems;
            ``(6) identify potential legislative changes which may be 
        appropriate to mitigate problems; and
            ``(7) refer instances of fraud, waste, and abuse, and 
        violations of law to the Office of the Inspector General of the 
        corporation.
    ``(c) Removal.--If the Participant and Plan Sponsor Advocate is 
removed from office or is transferred to another position or location 
within the Department of Labor, the Secretary shall communicate in 
writing the reasons for any such removal or transfer to Congress not 
less than 30 days before the removal or transfer. Nothing in this 
subsection shall prohibit a personnel action otherwise authorized by 
law, other than transfer or removal.
    ``(d) Compensation.--The annual rate of basic pay for the 
Participant and Plan Sponsor Advocate shall be the rate payable for 
level III of the Executive Schedule under section 5314 of title 5, 
United States Code, plus 3 percent.
    ``(e) Annual Report.--
            ``(1) In general.--Not later than December 31 of each 
        calendar year, the Participant and Plan Sponsor Advocate shall 
        report to the Health, Education, Labor, and Pensions Committee 
        of the Senate, the Committee on Finance of the Senate, the 
        Committee on Education and the Workforce of the House of 
        Representatives, and the Committee on Ways and Means of the 
        House of Representatives on the activities of the Office of the 
        Participant and Plan Sponsor Advocate during the fiscal year 
        ending during such calendar year.
            ``(2) Content.--Each report submitted under paragraph (1) 
        shall--
                    ``(A) describe the activities, and evaluate the 
                effectiveness of the Participant and Plan Sponsor 
                Advocate during the preceding year;
                    ``(B) identify significant problems the Participant 
                and Plan Sponsor Advocate has identified;
                    ``(C) include specific legislative and regulatory 
                changes to address the problems; and
                    ``(D) identify any actions taken to correct 
                problems identified in any previous report.
            ``(3) Concurrent submission.--The Participant and Plan 
        Sponsor Advocate shall submit a copy of each report to the 
        Secretary of Labor, the Director of the corporation, and any 
        other appropriate official at the same time such report is 
        submitted to the committees of Congress under paragraph (1).''.
    (b) Clerical Amendment.--The table of contents in section 1 of the 
Employee Retirement Income Security Act of 1974 is amended by inserting 
after the item relating to section 4003 the following new item:

``4004. Participant and Plan Sponsor Advocate.''.

SEC. 365. INCREASE IN MULTIEMPLOYER PLAN BENEFIT GUARANTEE AND ANNUAL 
              PREMIUM RATES.

    (a) Monthly Benefit Guarantee.--
            (1) In general.--Subparagraph (A) of section 4022A(c)(1) of 
        the Employee Retirement Income Security Act of 1974 (29 U.S.C. 
        1322a(c)(1)) is amended to read as follows:
            ``(A) 100 percent of the accrual rate up to $11, plus the 
        sum of--
                    ``(i) 75 percent of the lesser of--
                            ``(I) $33, or
                            ``(II) the accrual rate, if any, in excess 
                        of $11 and up to $44, and
                    ``(ii) 50 percent of the lesser of--
                            ``(I) $40, or
                            ``(II) the accrual rate, if any, in excess 
                        of $44, and''.
            (2) Adjustment for inflation.--Section 4022A(c) of such Act 
        (29 U.S.C. 1322a(c)) is amended by adding at the end the 
        following new paragraph:
    ``(4) For each plan year beginning in a calendar year after 2011, 
there shall be substituted for each dollar amount specified in 
subparagraph (A) of paragraph (1) an amount equal to the greater of--
            ``(A) the product derived by multiplying such dollar amount 
        specified in subparagraph (A) of paragraph (1) by the ratio 
        of--
                    ``(i) the national average wage index (as defined 
                in section 209(k)(1) of the Social Security Act) for 
                the first of the 2 calendar years preceding the 
                calendar year in which such plan year begins, to
                    ``(ii) the national average wage index (as so 
                defined) for 2009; and
            ``(B) such dollar amount in effect under subparagraph (A) 
        of paragraph (1) for plan years beginning in the preceding 
        calendar year.
If the amount determined under this paragraph is not a multiple of $1, 
such product shall be rounded to the nearest multiple of $1.''.
            (3) Effective date.--The amendment made by this subsection 
        shall apply to plans terminating or first receiving financial 
        assistance from the Pension Benefit Guaranty Corporation 
        (within the meaning under section 4261 of the Employee 
        Retirement Income Security Act of 1974 (29 U.S.C. 1431)) after 
        the date of the enactment of this Act.
    (b) Required Report.--Section 4022A(f) of such Act (29 U.S.C. 
1322a(f)) is amended by adding at the end the following new paragraph:
    ``(5) Notwithstanding any other provision of this subsection, the 
next report required to be submitted to Congress under this subsection 
after the date of enactment of the Pension Guaranty Improvement Act of 
2012 shall be submitted not later than December 31, 2013.''.
    (c) Annual Premium Rate.--
            (1) In general.--Subparagraph (A) of section 4006(a)(3) of 
        the Employee Retirement Income Security Act of 1974 (29 U.S.C. 
        1306(a)(3)) is amended--
                    (A) by inserting ``and before January 1, 2012,'' 
                after ``December 31, 2005,'' in clause (iv),
                    (B) by striking ``or'' at the end of clause (iii),
                    (C) by striking the period at the end of clause 
                (iv) and inserting ``, or'', and
                    (D) by adding at the end the following new clause:
            ``(v) in the case of a multiemployer plan, for plan years 
        beginning after December 31, 2011, $18.00 for each individual 
        who is a participant in such plan during the applicable plan 
        year.''.
            (2) Inflation adjustment.--Paragraph (3) of section 4006(a) 
        of such Act (29 U.S.C. 1306(a)) is amended by adding at the end 
        the following new subparagraph:
    ``(I) For each plan year beginning in a calendar year after 2011, 
there shall be substituted for the premium rate specified in clause (v) 
of subparagraph (A) an amount equal to the greater of--
            ``(i) the product derived by multiplying the premium rate 
        specified in clause (v) of subparagraph (A) by the ratio of--
                    ``(I) the national average wage index (as defined 
                in section 209(k)(1) of the Social Security Act) for 
                the first of the 2 calendar years preceding the 
                calendar year in which such plan year begins, to
                    ``(II) the national average wage index (as so 
                defined) for 2009; and
            ``(ii) the premium rate in effect under clause (v) of 
        subparagraph (A) for plan years beginning in the preceding 
        calendar year.
If the amount determined under this subparagraph is not a multiple of 
$1, such product shall be rounded to the nearest multiple of $1.''.

SEC. 366. IMPROVING SINGLE EMPLOYER PROGRAM SOLVENCY.

    (a) Flat-Rate Premium.--
            (1) In general.--Clause (i) of section 4006(a)(3)(A) of the 
        Employee Retirement Income Security Act of 1974 (29 U.S.C. 
        1306(a)(3)(A)) is amended to read as follows:
            ``(i) in the case of a single-employer plan, an amount for 
        each individual who is a participant in such plan during the 
        plan year equal to the sum of the additional premium (if any) 
        determined under subparagraph (E) and--
                    ``(I) for plan years beginning after December 31, 
                2005 and before January 1, 2012, $30;
                    ``(II) for plan years beginning after December 31, 
                2011, and before January 1, 2013, $42;
                    ``(III) for plan years beginning after December 31, 
                2012, and before January 1, 2014, $48; and
                    ``(IV) for plan years beginning after December 31, 
                2013, $54;''.
            (2) Adjustment for inflation.--Subparagraph (F) of section 
        4006(a)(3) of such Act (29 U.S.C. 1306(a)(3)) is amended by 
        adding at the end the following: ``For each plan year beginning 
        in a calendar year after 2011, clause (i)(II) shall be applied 
        by substituting `2009' for `2004'.''.
    (b) Variable-Rate Premium Adjustment for Inflation.--Section 
4006(a)(3) of such Act (29 U.S.C. 1306(a)(3)), as amended by section 
365, is further amended by adding at the end the following new 
subparagraph:
    ``(J) For each plan year beginning in a calendar year after 2011, 
there shall be substituted for the premium rate specified in clause 
(ii) of subparagraph (E) an amount equal to the greater of--
            ``(i) the product derived by multiplying the premium rate 
        specified in clause (ii) of subparagraph (E) by the ratio of--
                    ``(I) the national average wage index (as defined 
                in section 209(k)(1) of the Social Security Act) for 
                the first of the 2 calendar years preceding the 
                calendar year in which such plan year begins, to
                    ``(II) the national average wage index (as so 
                defined) for 2009; and
            ``(ii) the premium rate in effect under clause (ii) of 
        subparagraph (E) for plan years beginning in the preceding 
        calendar year.
If the amount determined under this subparagraph is not a multiple of 
$1, such product shall be rounded to the nearest multiple of $1.''.

             Subtitle H--Pension and Participant Protection

SEC. 371. SHORT TITLE.

    This subtitle may be cited as the ``Pension and Participant Protect 
Act''.

SEC. 372. FINDINGS.

    Congress makes the following findings:
            (1) The ongoing effects of the financial crisis have put 
        enormous stress on the defined benefit pension system.
            (2) It is in the best interest of plan participants for 
        Congress to take immediate steps to relieve that stress by 
        ensuring that pension contributions are less volatile and more 
        predictable, provided that participants are afforded additional 
        protections should their pensions be terminated in bankruptcy.
            (3) It is further in the best interest of participants for 
        Congress to take future steps to both reduce the volatility in 
        pension funding requirements and better protect plan 
        participants and retirees from loss.

SEC. 373. PENSION FUNDING STABILIZATION.

    (a) Amendments to Employee Retirement Income Security Act of 
1974.--
            (1) In general.--Subparagraph (C) of section 303(h)(2) of 
        the Employee Retirement Income Security Act of 1974 (29 U.S.C. 
        1083(h)(2)) is amended by adding at the end the following new 
        clause:
                            ``(iv) Segment rate stabilization.--
                                    ``(I) In general.--If a segment 
                                rate described in clause (i), (ii), or 
                                (iii) with respect to any applicable 
                                month (determined without regard to 
                                this clause) is less than the 
                                applicable minimum percentage, or more 
                                than the applicable maximum percentage, 
                                of the average of the segment rates 
                                described in such clause for years in 
                                the 25-year period ending with 
                                September 30 of the calendar year 
                                preceding the calendar year in which 
                                the plan year begins, then the segment 
                                rate described in such clause with 
                                respect to the applicable month shall 
                                be equal to the applicable minimum 
                                percentage or the applicable maximum 
                                percentage of such average, whichever 
                                is closest. The Secretary of the 
                                Treasury shall determine such average 
                                on an annual basis and may prescribe 
                                equivalent rates for years in any such 
                                25-year period for which the rates 
                                described in any such clause are not 
                                available.
                                    ``(II) Applicable minimum 
                                percentage; applicable maximum 
                                percentage.--For purposes of subclause 
                                (I), the applicable minimum percentage 
                                and the applicable maximum percentage 
                                for a plan year beginning in a calendar 
                                year shall be determined in accordance 
                                with the following table:

------------------------------------------------------------------------
                                                    The          The
                                                 applicable   applicable
          ``If the calendar year is:              minimum      maximum
                                                 percentage   percentage
                                                    is:          is:
------------------------------------------------------------------------
2012..........................................          90%         110%
2013..........................................          85%         115%
2014..........................................          80%         120%
2015..........................................          75%         125%
After 2015....................................          70%     130%.''.
------------------------------------------------------------------------

            (2) Conforming amendments.--
                    (A) Subparagraph (F) of section 303(h)(2) of such 
                Act (29 U.S.C. 1083(h)(2)) is amended by inserting 
                ``and the averages determined under subparagraph 
                (C)(iv)'' after ``subparagraph (C)''.
                    (B) Clauses (ii) and (iii) of section 205(g)(3)(B) 
                of such Act (29 U.S.C. 1055(g)(3)(B)) are each amended 
                by striking ``section 303(h)(2)(C)'' and inserting 
                ``section 303(h)(2)(C) (determined by not taking into 
                account any adjustment under clause (iv) thereof)''.
                    (C) Clause (iv) of section 4006(a)(3)(E) of such 
                Act (29 U.S.C. 1306(a)(3)(E)) is amended by striking 
                ``section 303(h)(2)(C)'' and inserting ``section 
                303(h)(2)(C) (notwithstanding any regulations issued by 
                the corporation, determined by not taking into account 
                any adjustment under clause (iv) thereof)''.
    (b) Amendments to Internal Revenue Code of 1986.--
            (1) In general.--Subparagraph (C) of section 430(h)(2) of 
        the Internal Revenue Code of 1986 is amended by adding at the 
        end the following new clause:
                            ``(iv) Segment rate stabilization.--
                                    ``(I) In general.--If a segment 
                                rate described in clause (i), (ii), or 
                                (iii) with respect to any applicable 
                                month (determined without regard to 
                                this clause) is less than the 
                                applicable minimum percentage, or more 
                                than the applicable maximum percentage, 
                                of the average of the segment rates 
                                described in such clause for years in 
                                the 25-year period ending with 
                                September 30 of the calendar year 
                                preceding the calendar year in which 
                                the plan year begins, then the segment 
                                rate described in such clause with 
                                respect to the applicable month shall 
                                be equal to the applicable minimum 
                                percentage or the applicable maximum 
                                percentage of such average, whichever 
                                is closest. The Secretary shall 
                                determine such average on an annual 
                                basis and may prescribe equivalent 
                                rates for years in any such 25-year 
                                period for which the rates described in 
                                any such clause are not available.
                                    ``(II) Applicable minimum 
                                percentage; applicable maximum 
                                percentage.--For purposes of subclause 
                                (I), the applicable minimum percentage 
                                and the applicable maximum percentage 
                                for a plan year beginning in a calendar 
                                year shall be determined in accordance 
                                with the following table:

------------------------------------------------------------------------
                                                    The          The
                                                 applicable   applicable
          ``If the calendar year is:              minimum      maximum
                                                 percentage   percentage
                                                    is:          is:
------------------------------------------------------------------------
2012..........................................          90%         110%
2013..........................................          85%         115%
2014..........................................          80%         120%
2015..........................................          75%         125%
After 2015....................................          70%     130%.''.
------------------------------------------------------------------------

            (2) Conforming amendments.--
                    (A) Paragraph (6) of section 404(o) of such Code is 
                amended by inserting ``(determined by not taking into 
                account any adjustment under clause (iv) of subsection 
                (h)(2)(C) thereof)'' before the period.
                    (B) Subparagraph (F) of section 430(h)(2) of such 
                Code is amended by inserting ``and the averages 
                determined under subparagraph (C)(iv)'' after 
                ``subparagraph (C)''.
                    (C) Subparagraphs (C) and (D) of section 417(e)(3) 
                of such Code are each amended by striking ``section 
                430(h)(2)(C)'' and inserting ``section 430(h)(2)(C) 
                (determined by not taking into account any adjustment 
                under clause (iv) thereof)''.
    (c) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        apply with respect to plan years beginning after December 31, 
        2011.
            (2) Exception.--A plan sponsor may elect not to have the 
        amendments made by this section apply to any plan year 
        beginning on or before the date of the enactment of this Act 
        solely for purposes of determining the adjusted funding target 
        attainment percentage under sections 436 of the Internal 
        Revenue Code of 1986 and 206(g) of the Employee Retirement 
        Income Security Act of 1974 for such plan year, provided that 
        the plan sponsor made such determination in good faith and 
        without an intent to trigger any statutorily required 
        restrictions on benefits. A plan shall not be treated as 
        failing to meet the requirements of sections 411(d)(6) of such 
        Code and 204(g) of such Act solely by reason of an election 
        under this paragraph.

SEC. 374. CONGRESSIONAL COMMITMENT TO ENCOURAGING PENSIONS.

    Not later than December 31, 2012, the Committee on Health, 
Education, Labor, and Pensions of the Senate and the Committee on 
Education and the Workforce of the House of Representatives shall issue 
a report providing recommendations to improve and expand the defined 
benefit pension system. Such report shall include recommendations 
concerning--
            (1) measures to further stabilize pension contribution 
        rates;
            (2) additional or expanded options to improve pension 
        funding flexibility for plan sponsors suffering a temporary 
        business hardship;
            (3) incentives for plans sponsors to establish or maintain 
        pension plans permitting new entrants and to encourage plan 
        sponsors to unfreeze their pension plans; and
            (4) modifications to the pension guaranty system and 
        bankruptcy law necessary or appropriate to protect plan 
        participants and retirees from inequitable treatment.

SEC. 375. PARTICIPANT PROTECTION IN BANKRUPTCY.

    Sections 4022(g) and 4044(e) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1322(g) and 1344(e)), as added by 
section 404 of the Pension Protection Act of 2006, are repealed as of 
October 1, 2011, and shall not apply with respect to proceedings 
initiated under title 11, United States Code, or under any similar 
Federal law or law of a State or political subdivision, on or after 
such date.

                     Subtitle I--Fair Playing Field

SEC. 381. SHORT TITLE; FINDINGS; PURPOSES.

    (a) Short Title.--This subtitle may be cited as the ``Fair Playing 
Field Act of 2012''.
    (b) Findings.--Congress makes the following findings:
            (1) In 1978, Congress was concerned that lack of clarity as 
        to the proper classification of some workers, increased IRS 
        enforcement activity, and retroactive application by IRS of 
        interpretations that were arguably new had caused hardships for 
        some small businesses and other taxpayers and confusion as to 
        the applicable rules.
            (2) To allow time to develop a comprehensive approach to 
        the problem, Congress enacted section 530 of the Revenue Act of 
        1978 as an interim measure protecting taxpayers from liability 
        for misclassification if the taxpayer has a reasonable basis 
        for classifying a worker as an independent contractor and meets 
        certain other conditions. In addition, the Act prohibited the 
        Secretary of the Treasury from publishing regulations or 
        revenue rulings on workers' employment tax status pending the 
        expected near-term enactment of clarifying legislation.
            (3) During the ensuing 33 years, Congress made section 530 
        of the Revenue Act of 1978 permanent, however, changes in 
        working relationships and the continued prohibition on new 
        guidance have increased the uncertainty as to the proper 
        classification of workers.
            (4) Many workers are properly classified as independent 
        contractors. In other instances, workers who are employees are 
        being treated as independent contractors. Such 
        misclassification for tax purposes contributes to inequities in 
        the competitive positions of businesses and to the Federal and 
        State tax gap, and may also result in misclassification for 
        other purposes, such as denial of unemployment benefits, 
        workplace health and safety protections, and retirement or 
        other benefits or protections available to employees.
            (5) Workers, businesses, and other taxpayers will benefit 
        from clear guidance regarding employment tax status. In the 
        interest of fairness and in view of many service recipients' 
        reliance on current section 530, such guidance should apply 
        only prospectively.
    (c) Purposes.--The purposes of this subtitle are to permit the 
Secretary of the Treasury to provide guidance allowing workers and 
businesses to clearly understand the proper Federal tax classification 
of workers and to provide relief allowing an orderly transition to new 
rules designed to increase certainty and uniformity of treatment.

SEC. 382. AUTHORITY TO ISSUE GUIDANCE CLARIFYING EMPLOYMENT STATUS FOR 
              PURPOSES OF EMPLOYMENT TAXES.

    (a) In General.--Chapter 25 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new section:

``SEC. 3511. AUTHORITY TO ISSUE GUIDANCE CLARIFYING EMPLOYMENT STATUS.

    ``(a) In General.--The Secretary shall issue such regulations or 
other guidance as the Secretary determines to be necessary or 
appropriate to clarify the proper employment status of individuals for 
purposes of any tax imposed by this subtitle.
    ``(b) Prohibition on Retroactive Assessments.--
            ``(1) In general.--If--
                    ``(A) for purposes of any tax imposed by this 
                subtitle, the taxpayer did not treat an individual as 
                an employee for any period before the reclassification 
                date with respect to such individual, and
                    ``(B) in the case of periods after December 31, 
                1978, and before such reclassification date, all 
                Federal tax returns (including information returns) 
                required to be filed by the taxpayer with respect to 
                such individual for such period are filed on a basis 
                consistent with the taxpayer's treatment of such 
                individual as not being an employee,
        then, for purposes of applying such taxes for periods before 
        such reclassification date with respect to the taxpayer, the 
        individual shall be deemed not to be an employee unless the 
        taxpayer had no reasonable basis for not treating such 
        individual as an employee.
            ``(2) Statutory standards providing one method of 
        satisfying the requirements of paragraph (1).--For purposes of 
        paragraph (1), a taxpayer shall in any case be treated as 
        having a reasonable basis for not treating an individual as an 
        employee for a period if the taxpayer's treatment of such 
        individual for such period was in reasonable reliance on any of 
        the following:
                    ``(A) Judicial precedent, published rulings, 
                technical advice with respect to the taxpayer, or a 
                letter ruling to the taxpayer.
                    ``(B) A past Internal Revenue Service audit of the 
                taxpayer in which there was no assessment attributable 
                to the treatment (for purposes of any tax imposed by 
                this subtitle) of the individuals holding positions 
                substantially similar to the position held by such 
                individual.
                    ``(C) Long-standing recognized practice of a 
                significant segment of the industry in which such 
                individual was engaged.
            ``(3) Consistency required in the case of prior tax 
        treatment.--Paragraph (1) shall not apply with respect to the 
        treatment of any individual (hereafter in this paragraph 
        referred to as the reclassified individual) for purposes of any 
        tax imposed by this subtitle for any period ending after 
        December 31, 1978, if the taxpayer (or a predecessor) has 
        treated any individual holding a substantially similar position 
        as an employee for purposes of any tax imposed by this subtitle 
        for any period beginning after December 31, 1977, and ending 
        before the reclassification date with respect to such 
        reclassified individual.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Reclassification date.--
                    ``(A) In general.--The term `reclassification date' 
                means, with respect to any individual, the earlier of--
                            ``(i) the first day of the first calendar 
                        quarter beginning more than 180 days after the 
                        date of an employee classification 
                        determination with respect to such individual, 
                        or
                            ``(ii) the effective date of the first 
                        applicable final regulation issued by the 
                        Secretary under subsection (a) with respect to 
                        such individual (or, if later, the first day of 
                        the first calendar quarter beginning more than 
                        180 days after such regulation is issued).
                    ``(B) Employee classification determination.--The 
                term `employee classification determination' means, 
                with respect to any individual, a determination by the 
                Secretary, in connection with an audit of the taxpayer 
                which is described in section 7436 and which commences 
                after the date which is 1 year after the date of the 
                enactment of this section, that a class of individuals 
                holding positions with such taxpayer which are 
                substantially similar to the position held by such 
                individual are employees.
                    ``(C) First applicable final regulation.--The term 
                `first applicable final regulation' means, with respect 
                to any individual, the first final regulation (or other 
                guidance of general applicability) which sets forth the 
                factors for determining the employment status of a 
                class of individuals holding positions substantially 
                similar to the position held by such individual.
            ``(2) Employment status.--The term `employment status' 
        means the status of an individual, under the usual common law 
        rules applicable in determining the employer-employee 
        relationship, as an employee or as an independent contractor 
        (or other individual who is not an employee).
    ``(d) Continuation of Certain Special Rules.--
            ``(1) Exception for certain skilled workers.--Subsection 
        (b) shall not apply in the case of an individual who, pursuant 
        to an arrangement between the taxpayer and another person, 
        provides services for such other person as an engineer, 
        designer, drafter, computer programmer, systems analyst, or 
        other similarly skilled worker engaged in a similar line of 
        work.
            ``(2) Notice of availability of section.--An officer or 
        employee of the Internal Revenue Service shall, before or at 
        the commencement of any audit inquiry relating to the 
        employment status of one or more individuals who perform 
        services for the taxpayer, provide the taxpayer with a written 
        notice of the provisions of this section.
            ``(3) Rules relating to statutory standards.--For purposes 
        of subsection (b)(2)--
                    ``(A) a taxpayer may not rely on an audit commenced 
                after December 31, 1996, for purposes of subparagraph 
                (B) thereof unless such audit included an examination 
                for purposes of any tax imposed by this subtitle 
                whether the individual involved (or any individual 
                holding a position substantially similar to the 
                position held by the individual involved) should be 
                treated as an employee of the taxpayer,
                    ``(B) in no event shall the significant segment 
                requirement of subparagraph (C) thereof be construed to 
                require a reasonable showing of the practice of more 
                than 25 percent of the industry (determined by not 
                taking into account the taxpayer), and
                    ``(C) in applying the long-standing recognized 
                practice requirement of subparagraph (C) thereof--
                            ``(i) such requirement shall not be 
                        construed as requiring the practice to have 
                        continued for more than 10 years, and
                            ``(ii) a practice shall not fail to be 
                        treated as long-standing merely because such 
                        practice began after 1978.
            ``(4) Availability of safe harbors.--Nothing in this 
        section shall be construed to provide that subsection (b) only 
        applies where the individual involved is otherwise an employee 
        of the taxpayer.
            ``(5) Burden of proof.--
                    ``(A) In general.--If--
                            ``(i) a taxpayer establishes a prima facie 
                        case that it was reasonable not to treat an 
                        individual as an employee for purposes of 
                        subsection (b), and
                            ``(ii) the taxpayer has fully cooperated 
                        with reasonable requests from the Secretary,
                then the burden of proof with respect to such treatment 
                shall be on the Secretary.
                    ``(B) Exception for other reasonable basis.--In the 
                case of any issue involving whether the taxpayer had a 
                reasonable basis not to treat an individual as an 
                employee for purposes of subsection (b), subparagraph 
                (A) shall only apply for purposes of determining 
                whether the taxpayer meets the requirements of 
                subparagraph (A), (B), or (C) of subsection (b)(2).
            ``(6) Preservation of prior period safe harbor.--If--
                    ``(A) an individual would (but for the treatment 
                referred to in subparagraph (B)) be deemed not to be an 
                employee of the taxpayer under subsection (b) for any 
                prior period, and
                    ``(B) such individual is treated by the taxpayer as 
                an employee for purposes of the taxes imposed by this 
                subtitle for any subsequent period,
        then, for purposes of applying such taxes for such prior period 
        with respect to the taxpayer, the individual shall be deemed 
        not to be an employee.
            ``(7) Substantially similar position.--For purposes of 
        subsection (b) and this subsection, the determination as to 
        whether an individual holds a position substantially similar to 
        a position held by another individual shall include 
        consideration of the relationship between the taxpayer and such 
        individuals.
            ``(8) Treatment of test room supervisors and proctors who 
        assist in the administration of college entrance and placement 
        exams.--
                    ``(A) In general.--In the case of an individual 
                described in subparagraph (B) who is providing services 
                as a test proctor or room supervisor by assisting in 
                the administration of college entrance or placement 
                examinations, subsection (b) shall be applied to such 
                services performed after December 31, 2006 (and 
                remuneration paid for such services) without regard to 
                paragraph (3) thereof.
                    ``(B) Applicability.--An individual is described in 
                this subparagraph if the individual--
                            ``(i) is providing the services described 
                        in subsection (b) to an organization described 
                        in section 501(c) and exempt from tax under 
                        section 501(a), and
                            ``(ii) is not otherwise treated as an 
                        employee of such organization for purposes of 
                        this subtitle.
            ``(9) Treatment of securities broker dealers.--In 
        determining for purposes of this title whether a registered 
        representative of a securities broker-dealer is an employee (as 
        defined in section 3121(d)), no weight shall be given to 
        instructions from the service recipient which are imposed only 
        in compliance with investor protection standards imposed by the 
        Federal Government, any State government, or a governing body 
        pursuant to a delegation by a Federal or State agency.
    ``(e) Statements to Independent Contractors.--
            ``(1) In general.--Each person who contracts for the 
        services of an independent contractor on a regular and ongoing 
        basis, within the scope of such person's trade or business, 
        shall provide a written statement to such independent 
        contractor notifying such independent contractor of the Federal 
        tax obligations of an independent contractor, the labor and 
        employment law protections that do not apply to independent 
        contractors, and the right of such independent contractor to 
        seek a status determination from the Internal Revenue Service.
            ``(2) Independent contractor.--For purposes of this 
        subsection, the term `independent contractor' means any 
        individual who is not treated as an employee by the person 
        receiving the services referred to in paragraph (1).
            ``(3) Timing of statement.--Except as otherwise provided by 
        the Secretary, the statement required under paragraph (1) shall 
        be provided within a reasonable period of entering into the 
        contract referred to in paragraph (1).
            ``(4) Development of model statement.--The Secretary shall 
        develop model materials for providing the statement required 
        under paragraph (1).''.
    (b) Reduced Penalty Not Applicable in Cases of Noncompliance With 
Guidance Without Reasonable Basis.--Subsection (c) of section 3509 of 
the Internal Revenue Code of 1986 is amended--
            (1) by striking ``if such liability'' and inserting ``if--
            ``(1) such liability'', and
            (2) by striking the period at the end and inserting ``, or
            ``(2) such liability relates to an individual who is 
        treated as an employee under regulations or other guidance 
        issued by the Secretary under section 3511(a) and the taxpayer 
        lacks a reasonable basis for treating the individual as other 
        than an employee.
In the case of a taxpayer which has received a final written 
determination from the Internal Revenue Service holding that the 
individual referred to in paragraph (2) (or another individual who 
holds a position with the taxpayer substantially similar to the 
position held by such individual) is an employee, such taxpayer shall 
be treated for purposes of paragraph (2) as lacking a reasonable basis 
for treating such individual as other than an employee with respect to 
periods beginning on and after the first day of the first calendar 
quarter beginning more than 180 days after the date of such written 
determination unless the taxpayer establishes by clear and convincing 
evidence that the taxpayer has a reasonable basis for such 
treatment.''.
    (c) Conforming Amendments.--
            (1) Paragraph (2) of section 6724(d) of the Internal 
        Revenue Code of 1986 is amended by striking ``or'' at the end 
        of subparagraph (GG), by striking the period at the end of 
        subparagraph (HH) and inserting ``, or'', and by inserting 
        after subparagraph (HH) the following new subparagraph:
                    ``(II) section 3511(e) (relating to statements to 
                independent contractors).''.
            (2) Paragraph (2) of section 7436(a) of such Code is 
        amended by striking ``subsection (a) of section 530 of the 
        Revenue Act of 1978'' and inserting ``section 3511(b)''.
            (3) The table of sections for chapter 25 of such Code is 
        amended by adding at the end the following new item:

``Sec. 3511. Authority to issue guidance clarifying employment 
                            status.''.
    (d) Termination of Section 530 of the Revenue Act of 1978.--The 
Revenue Act of 1978 is amended by striking section 530.
    (e) Reports on Worker Misclassification.--Beginning with the first 
fiscal year beginning after the date the first regulation or other 
guidance is issued for public comment under section 3511(a) of the 
Internal Revenue Code of 1986 (as added by this section):
            (1) A report each fiscal year on worker classification 
        which shall include the total number of examinations of 
        employers initiated because of suspected worker classification 
        issues, the total number of examinations that included 
        determinations on worker classification issues, the amount of 
        additional tax liabilities associated with worker 
        classification enforcement actions, the number of workers 
        reclassified as a result of these actions, the number of 
        requests for Determination of Worker Status (Form SS-8), and 
        technical guidance on how to understand the data provided in 
        the report.
            (2) A report each fiscal year in which new statistically 
        valid data is compiled and interpreted on worker 
        classification, prepared on the basis of information gathered 
        during an Employment Tax Study conducted by the National 
        Research Program (NRP) of the Internal Revenue Service. Such 
        report shall provide statistical estimates of the number of 
        employers misclassifying workers, the number of workers 
        misclassified, the industries involved, data interpretations 
        and conclusions, and a description of the impact of improper 
        worker classification on the employment tax gap.
    (f) Effective Dates.--
            (1) Delayed effective date of regulations and guidance.--
        Except as provided in paragraph (2), any regulation or other 
        guidance issued under section 3511(a) of the Internal Revenue 
        Code of 1986, as added by this section, shall not apply to 
        services rendered before the date which is 1 year after the 
        date of the enactment of this Act.
            (2) Treatment of securities broker dealers.--Paragraph (9) 
        of section 3511(d) of the Internal Revenue Code of 1986, as 
        added by this section, shall apply to services performed after 
        December 31, 1997.
            (3) Authority to issue regulations and guidance 
        immediately.--So much of the amendment made by subsection (d) 
        as relates to subsection (b) of section 530 of the Revenue Act 
        of 1978 shall take effect on the date of the enactment of this 
        Act.
            (4) Delayed termination of remainder of section 530 of the 
        revenue act of 1978.--Except as provided in paragraph (3), the 
        amendments made by subsections (c)(1) and (d) shall apply to 
        services rendered on or after the date which is 1 year after 
        the date of the enactment of this Act.

                  TITLE IV--REBUILD AMERICA TRUST FUND

SEC. 401. ESTABLISH REBUILD AMERICA TRUST FUND.

    (a) In General.--Subchapter A of chapter 98 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new section:

``SEC. 9512. REBUILD AMERICA TRUST FUND.

    ``(a) Creation of Trust Fund.--There is established in the Treasury 
of the United States a trust fund to be known as the `Rebuild America 
Trust Fund', consisting of such amounts as may be appropriated or 
credited to such fund as provided in this section or section 9602(b).
    ``(b) Transfers to Trust Fund.--There are hereby appropriated to 
the Rebuild America Trust Fund amounts equivalent to the revenues 
resulting from the amendments made by title III of the Rebuild America 
Act.
    ``(c) Authority To Borrow.--
            ``(1) In general.--There are authorized to be appropriated 
        to the Rebuild America Trust Fund, as repayable advances, such 
        sums as may be necessary to carry out the other purposes of the 
        Rebuild America Act as described in subsection (d)(2).
            ``(2) Limitation on aggregate advances.--The maximum 
        aggregate amount of repayable advances to the Rebuild America 
        Trust Fund which is outstanding at any one time shall not 
        exceed an amount equal to the amount which the Secretary 
        estimates will be equal to the sum of the amounts appropriated 
        to the Rebuild America Trust Fund under subsection (b) during 
        the following 60 months.
            ``(3) Repayment of advances.--
                    ``(A) In general.--Advances made to the Rebuild 
                America Trust Fund shall be repaid, and interest on 
                such advances shall be paid, to the general fund of the 
                Treasury when the Secretary determines that moneys are 
                available for such purposes in the Rebuild America 
                Trust Fund.
                    ``(B) Final repayment.--No advance shall be made to 
                the Rebuild America Trust Fund after September 30, 
                2022, and all advances to such Trust Fund shall be 
                repaid on or before September 30, 2024.
                    ``(C) Rate of interest.--Interest on advances made 
                to the Rebuild America Trust Fund shall be at a rate 
                determined by the Secretary of the Treasury (as of the 
                close of the calendar month preceding the month in 
                which the advance is made) to be equal to the current 
                average market yield on outstanding marketable 
                obligations of the United States with remaining periods 
                to maturity comparable to the anticipated period during 
                which the advance will be outstanding and shall be 
                compounded annually.
    ``(d) Expenditures.--
            ``(1) In general.--Amounts in the Rebuild America Trust 
        Fund shall be available, without further appropriation--
                    ``(A) to transfer to accounts specified by, and to 
                carry out the provisions of, section 103 of the Rebuild 
                America Act, and
                    ``(B) as provided for in the Rebuild America Act 
                (and the amendments made by that Act).
            ``(2) Allocation of funds.--The Secretary shall allocate 
        funds from the Rebuild America Trust Fund to the responsible 
        Departments for distribution to the States and subdivisions 
        within 15 days of the beginning of each fiscal year as set in 
        section 103 of the Rebuild America Act. Each Secretary of such 
        a Department shall allocate the funds set by formula to the 
        States or local receiving entities within 90 days of the 
        beginning of such fiscal year.
            ``(3) Administrative funds.--The portion of funds allowed 
        for administrative costs for any account may not exceed the 
        percentage used for administering those funds at both the 
        Federal and the State levels under the underlying regular 
        program that is in effect for the latest appropriations measure 
        expiring at the end of a fiscal year.
            ``(4) Maintenance of effort.--
                    ``(A) Federal level.--The funds provided from the 
                Rebuild America Trust Fund shall not be provided by the 
                Secretary to an account if the appropriations for that 
                account are to be funded at not less than the sum 
                provided in fiscal year 2012, not including emergency 
                funds.
                    ``(B) State level.--A State or local government 
                shall not receive funds for an account provided by the 
                Rebuild America Trust Fund unless that State maintains 
                the same level of funding for that function as the 
                State and local governments provided in State fiscal 
                year 2011. The Secretary shall, by rule define the 
                State programs representing the function for each 
                account for which funds are provided by the Trust Fund.
            ``(5) Use of american iron, steel, manufactured goods, and 
        equipment.--
                    ``(A) In general.--None of the funds made available 
                by the Rebuild America Trust Fund may be used for a 
                project for the construction, alteration, maintenance, 
                or repair of a public building or public work unless 
                all of the iron, steel, manufactured goods, and 
                equipment used in the project are produced in the 
                United States.
                    ``(B) Exceptions.--Subparagraph (A) shall not apply 
                in any case or category of cases in which the head of 
                the Federal department or agency involved finds that--
                            ``(i) applying subparagraph (A) would be 
                        inconsistent with the public interest,
                            ``(ii) iron, steel, the relevant 
                        manufactured goods, or the relevant equipment 
                        are not produced in the United States in 
                        sufficient and reasonably available quantities 
                        and of a satisfactory quality, or
                            ``(iii) inclusion of iron, steel, 
                        manufactured goods, and equipment produced in 
                        the United States will increase the cost of the 
                        overall project by more than 25 percent.
                    ``(C) Publication of justification.--If the head of 
                a Federal department or agency determines that it is 
                necessary to waive the application of subparagraph (A) 
                based on a finding under subparagraph (B), the head of 
                the department or agency shall publish in the Federal 
                Register a detailed written justification as to why the 
                provision is being waived.
                    ``(D) Consistency with international agreements.--
                This paragraph shall be applied in a manner consistent 
                with United States obligations under international 
                agreements.
            ``(6) Wage rate requirements.--Notwithstanding any other 
        provision of law and in a manner consistent with other 
        provisions in this section and in the Rebuild America Act, all 
        laborers and mechanics employed by contractors and 
        subcontractors on projects funded directly by or assisted in 
        whole or in part by and through the Federal Government pursuant 
        to funds made available by the Rebuild America Act shall be 
        paid wages at rates not less than those prevailing on projects 
        of a character similar in the locality as determined by the 
        Secretary of Labor in accordance with subchapter IV of chapter 
        31 of title 40, United States Code. With respect to the labor 
        standards specified in this paragraph, the Secretary of Labor 
        shall have the authority and functions set forth in 
        Reorganization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 
        U.S.C. App.) and section 3145 of title 40, United States 
        Code.''.
    (b) Conforming Amendment.--The table of sections for subchapter A 
of chapter 98 of such Code is amended by adding at the end the 
following new item:

``Sec. 9512. Rebuild America Trust Fund.''.
                                 <all>
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