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Neighbors in Need Act (Introduced in House)
HR 3295 IH
108th CONGRESS
1st Session
H. R. 3295
To provide for additional benefits under the Temporary Extended Unemployment Compensation Act of 2002, to extend the Federal unemployment benefits system, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
October 15, 2003
Mr. ENGLISH introduced the following bill; which was referred to the Committee on Ways and Means
A BILL
To provide for additional benefits under the Temporary Extended Unemployment Compensation Act of 2002, to extend the Federal unemployment benefits system, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE- This Act may be cited as the `Neighbors in Need Act'.
(b) TABLE OF CONTENTS- The table of contents of this Act is as follows:
Sec. 1. Short title; table of contents.
TITLE I--TEMPORARY EXTENDED UNEMPLOYMENT COMPENSATION
Sec. 101. Additional weeks of benefits.
Sec. 102. Program extension in States with high unemployment.
TITLE II--FEDERAL UNEMPLOYMENT BENEFIT SYSTEM REFORMS
Sec. 201. Increase and decrease in earnings credited to State accounts when States meet or fail to meet funding goals.
Sec. 202. Interest-free advances to State accounts in Unemployment Trust Fund restricted to States which meet funding goals.
TITLE III--AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986
Sec. 301. 2-year suspension of tax on unemployment compensation.
Sec. 302. State collection of Federal unemployment tax.
Sec. 303. Required distribution of State-specific information packets.
TITLE I--TEMPORARY EXTENDED UNEMPLOYMENT COMPENSATION
SEC. 101. ADDITIONAL WEEKS OF BENEFITS.
(a) IN GENERAL- Section 203 of the Temporary Extended Unemployment Compensation Act of 2002 is amended by adding at the end the following:
`(d) ADDITIONAL WEEKS OF BENEFITS- Notwithstanding any other provision of this section, upon the exhaustion of all amounts that may be credited to an individual's account under the preceding provisions of this section, such account shall be increased by an amount equal to 8 times the individual's average weekly benefit amount for the benefit year (as determined under subsection (b)(2)).'.
(b) EFFECTIVE DATE AND APPLICABILITY- The amendment made by subsection (a)--
(1) shall take effect as if included in the enactment of the Temporary Extended Unemployment Compensation Act of 2002, and shall apply to weeks of unemployment beginning on or after the date of the enactment of this Act, but
(2) shall not apply in the case of any individual whose eligibility for additional weeks of benefits would be based on an exhaustion of amounts (as required under such amendment) occurring on or after the date of the enactment of this Act.
SEC. 102. PROGRAM EXTENSION IN STATES WITH HIGH UNEMPLOYMENT.
(a) APPLICABILITY- This section applies only to any State with respect to which, during the last week in December 2003, an extended benefit period (as described in section 203 of the Federal-State Extended Unemployment Compensation Act of 1970)--
(2) would be in effect, if subsection (d) of such section 203 were applied by substituting--
(A) `100' for `120' in paragraph (1)(A); and
(B) `3.5' for `5' in paragraph (1)(B) and the first flush sentence following paragraph (2).
(b) EXTENSION- In the case of each State that satisfies subsection (a), section 208 of the Temporary Extended Unemployment Compensation Act of 2002 shall be applied as if it had been amended--
(1) in subsection (a)(2), by striking `December 31, 2003' and inserting `March 31, 2004';
(2) in subsection (b)(1), by striking `December 31, 2003' and inserting `March 31, 2004';
(3) in subsection (b)(2)--
(A) in the heading, by striking `DECEMBER 31, 2003' and inserting `MARCH 31, 2004'; and
(B) by striking `December 31, 2003' and inserting `March 31, 2004'; and
(4) in subsection (b)(3), by striking `March 31, 2004' and inserting `June 30, 2004'.
(c) DEFINITIONS- For purposes of this section, the terms `State' and `week' have the respective meanings given such terms under section 207 of the Temporary Extended Unemployment Compensation Act of 2002.
(d) RULE OF CONSTRUCTION- Nothing in this Act shall be considered to limit, terminate, or otherwise affect any unemployment benefits provided under section 4002 of the Emergency Wartime Supplemental Appropriations Act, 2003.
(e) EFFECTIVE DATE- The amendments made by this section shall take effect as if included in the enactment of the Temporary Extended Unemployment Compensation Act of 2002.
TITLE II--FEDERAL UNEMPLOYMENT BENEFIT SYSTEM REFORMS
SEC. 201. INCREASE AND DECREASE IN EARNINGS CREDITED TO STATE ACCOUNTS WHEN STATES MEET OR FAIL TO MEET FUNDING GOALS.
(a) IN GENERAL- Section 904 of the Social Security Act (42 U.S.C. 1104) is amended by adding at the end the following new subsection:
`Increase and Decrease in Amount of Earnings Allocated to State Accounts When States Meet or Fail to Meet Funding Goals
`(h)(1) If the average daily balance in a State account in the Unemployment Trust Fund for any calendar quarter exceeds the funding goal of such State, the amount otherwise creditable to such account under subsection (e) for such quarter shall be increased by the interest premium on such excess. If the average daily balance in such a State account for any calendar quarter is less than the funding goal of such State, the amount otherwise creditable to such account under subsection (e) for such quarter shall be decreased by the interest penalty.
`(2) Paragraph (1) shall not apply with respect to any interest premium or interest penalty to the extent that such application would result in an increase or decrease of more than $2,500,000 in the amount creditable to any State account for any calendar quarter.
`(3) For purposes of this subsection, the term `interest premium' means, for any calendar quarter--
`(A) with respect to the State with the largest percentage value of excess of the average daily balance in the State account in the Unemployment Trust Fund over the funding goal of such State, one-half of one percent of the amount of such excess, and
`(B) with respect to each other State, the product of--
`(i) the amount of the excess of the average daily balance in the State account in the Unemployment Trust Fund over the funding goal of such State, and
`(ii) the percentage which bears the same ratio to one-half of one percent as--
`(I) the percentage value of such excess, bears to
`(II) the percentage value of the excess of the State referred to in subparagraph (A).
The Secretary shall make appropriate adjustments in the interest premium for any calendar quarter if the aggregate interest premiums payable for such quarter exceed the aggregate interest penalties for such quarter.
`(4) For purposes of this subsection, the term `interest penalty' means, for any calendar quarter--
`(A) with respect to the State with the largest percentage value of excess of the funding goal of such State over the average daily balance in the State account in the Unemployment Trust Fund, one-half of one percent of the amount otherwise creditable to such account under subsection (e), and
`(B) with respect to each other State, the product of--
`(i) the amount otherwise creditable to such account under subsection (e), and
`(ii) the percentage which bears the same ratio to one-half of one percent as--
`(I) the percentage value of the excess of the funding goal of the State over such
average daily balance of such State, bears to
`(II) the percentage value of such excess of the State referred to in subparagraph (A).
`(5) For purposes of this subsection, the term `funding goal' means, for any State for any calendar quarter, the average of the unemployment insurance benefits paid by such State during each of the 3 years, in the 20-year period ending with the calendar year containing such calendar quarter, during which the State paid the greatest amount of unemployment benefits.
`(6) For purposes of this subsection, the term `percentage value' means--
`(A) with respect to any excess of the average daily balance in a State account in the Unemployment Trust Fund over the funding goal of such State, the percentage which such excess bears to such funding goal, and
`(B) with respect to any excess of such funding goal over such average daily balance, the percentage which such excess bears to such funding goal.'.
(b) CONFORMING AMENDMENTS-
(1) AMOUNTS CREDITED TO STATE ACCOUNTS- Subsection (e) of section 904 of the Social Security Act (42 U.S.C. 1104(e)) is amended in the first sentence by inserting `(as modified by subsection (h))' after `a proportionate part'.
(2) INTEREST RATE ON REPAYMENT OF ADVANCES DETERMINED WITHOUT REGARD TO INTEREST PREMIUMS OR PENALTIES ON AMOUNTS CREDITED TO STATE ACCOUNTS- Subparagraph (A) of section 1202(b)(4) of such Act (42 U.S.C. 1322(b)(4)) is amended by inserting `(determined without regard to section 904(h))' after `preceding calendar year'.
(c) REPORT- Not later than 6 months after the date of the enactment of this Act, the Secretary of Labor shall submit to the Congress a report recommending sources of funding for the crediting of interest premiums under subsection (h) of section 904 of the Social Security Act (42 U.S.C. 1104), as added by this section, in the event that the imposition of interest penalties under such subsection is insufficient to fund such premiums.
(d) EFFECTIVE DATE- The amendments made by this section shall apply to calendar years beginning after December 31, 2007.
SEC. 202. INTEREST-FREE ADVANCES TO STATE ACCOUNTS IN UNEMPLOYMENT TRUST FUND RESTRICTED TO STATES WHICH MEET FUNDING GOALS.
(a) IN GENERAL- Subparagraph (C) of section 1202(b)(2) of the Social Security Act (42 U.S.C. 1322(b)(2)) is amended to read as follows:
`(C) the average daily balance in the account of such State in the Unemployment Trust Fund for each of 4 of the 5 calendar quarters preceding the calendar quarter in which such advances were made exceeds the funding goal of such State (as defined in section 904(h)).'
(b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to calendar years beginning after the date of the enactment of this Act.
TITLE III--AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986
SECTION 301. 2-YEAR SUSPENSION OF TAX ON UNEMPLOYMENT COMPENSATION.
(a) IN GENERAL- Section 85 of the Internal Revenue Code of 1986 (relating to unemployment compensation) is amended by adding at the end the following new subsection:
`(c) MORATORIUM- This section shall not apply to taxable years beginning in 2004 or 2005.'.
(b) EFFECTIVE DATE- The amendment made by this section shall apply to taxable years beginning after December 31, 2003.
SEC. 302. STATE COLLECTION OF FEDERAL UNEMPLOYMENT TAX.
(a) IN GENERAL- Chapter 23 of the Internal Revenue Code of 1986 (relating to Federal Unemployment Tax Act) is amended by redesignating section 3311 as section 3312 and by inserting after section 3310 the following new section:
`SEC. 3311. STATE COLLECTION OF TAX.
`(a) IN GENERAL- At the election of any State which is certified as provided in section 3304, each employer who pays contributions, with respect to any wages, into an unemployment fund maintained under the unemployment compensation law of such State shall submit the tax imposed by this chapter with respect to such wages to such State rather than to the Secretary.
`(b) COORDINATION WITH DEPOSITARY REQUIREMENTS- Payment under subsection (a) of the tax imposed by this chapter with respect to any wages shall be treated as timely paid for purposes of this title if paid by the employer to the State at the same time as a timely paid payment, with respect to such wages, of contributions into an unemployment fund maintained under the unemployment compensation law of such State.
`(c) EXCEPTION FOR PAYMENTS NOT TIMELY PAID- Subsection (a) shall not apply to any payment of the tax imposed by this chapter which is not paid by an employer on or before the last date on which such payment would be treated as timely paid under subsection (b).
`(d) FEDERAL TAX TRANSFERRED TO SECRETARY- Each State making an election under subsection (a) shall transmit to the Secretary, at the time and in the manner prescribed by the Secretary, the amount of the tax imposed by this chapter which is submitted to such State under subsection (a) and a copy of the State tax return of each employer making such a submission. The Secretary may, after consultation with such organizations or other entities as the Secretary considers appropriate, prescribe regulations requiring that additional information be submitted by such State with respect to the amount of such tax payable by such employer.'
(b) CLERICAL AMENDMENT- The table of sections for chapter 23 of such Code is amended by striking the item relating to section 3311 and inserting the following new items:
`Sec. 3311. State collection of tax.
`Sec. 3312. Short title.'
(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 2004.
SEC. 303. REQUIRED DISTRIBUTION OF STATE-SPECIFIC INFORMATION PACKETS.
(a) IN GENERAL- Subsection (a) of section 3304 of the Internal Revenue Code of 1986 (relating to approval of State laws) is amended by striking `and' at the end of paragraph (18), by striking the period at the end of paragraph (19) and inserting `; and', and by adding at the end the following new paragraph:
`(20) the State will distribute to unemployed individuals State-specific information packets explaining unemployment insurance eligibility conditions.'
(b) EFFECTIVE DATE- The amendment made by subsection (a) shall apply to certifications of States for 2004, except that section 3304(a)(20) of such Code, as added by subsection (a), shall not be a requirement for the State law of any State prior to July 1, 2005, if the legislature of such State does not meet in a regular session which closes during the calendar year 2004.
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