[House Report 112-87]
[From the U.S. Government Publishing Office]


112th Congress                                             Rept. 112-87
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 1

======================================================================



 
                            JOBS ACT OF 2011

                                _______
                                

  May 23, 2011.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

            Mr. Camp, from the Committee on Ways and Means, 
                        submitted the following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                        [To accompany H.R. 1745]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
bill (H.R. 1745) to improve jobs, opportunity, benefits, and 
services for unemployed Americans, and for other purposes, 
having considered the same, report favorably thereon with an 
amendment and recommend that the bill as amended do pass.
    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Jobs, Opportunity, 
Benefits, and Services Act of 2011'' or the ``JOBS Act of 2011''.
  (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.

 TITLE I--REFORMS OF UNEMPLOYMENT COMPENSATION TO PROMOTE WORK AND JOB 
                                CREATION

Sec. 101. Consistent job search requirements.
Sec. 102. Participation in reemployment services made a condition of 
benefit receipt.
Sec. 103. State flexibility to promote the reemployment of unemployed 
workers.
Sec. 104. Repeal of regulation requiring higher State taxes.
Sec. 105. Restore State flexibility to improve unemployment program 
solvency.
Sec. 106. Data standardization for improved data matching.
Sec. 107. Technical and conforming amendments.

      TITLE II--FORWARD FUNDING OF REMAINING FEDERAL UNEMPLOYMENT 
                           COMPENSATION FUNDS

Sec. 201. Special transfers to all States.
Sec. 202. Emergency unemployment compensation transition rules.
Sec. 203. Extended benefits program transition rules.
Sec. 204. Emergency designation.

 TITLE I--REFORMS OF UNEMPLOYMENT COMPENSATION TO PROMOTE WORK AND JOB 
                                CREATION

SEC. 101. CONSISTENT JOB SEARCH REQUIREMENTS.

  (a) In General.--Section 303(a) of the Social Security Act is amended 
by adding at the end the following:
          ``(11)(A) A requirement that, as a condition of eligibility 
        for regular compensation for any week, a claimant must be able 
        to work, available to work, and actively seeking work.
          ``(B) For purposes of this paragraph, the term `actively 
        seeking work' means, with respect to any individual, that such 
        individual is actively engaged in a systematic and sustained 
        effort to obtain work, as determined based on evidence (whether 
        in electronic format or otherwise) satisfactory to the State 
        agency charged with the administration of the State law.
          ``(C) The specific requirements that must be met in order to 
        satisfy this paragraph shall be established by the State 
        agency, and shall include at least the following:
                  ``(i) Registration for employment services within 14 
                days after making initial application for regular 
                compensation.
                  ``(ii) Posting a resume, record, or other application 
                for employment on such database as the State agency may 
                require.
                  ``(iii) Applying, in such manner as the State agency 
                may require, for work which is similar to that 
                previously performed by the individual, and which 
                offers wages comparable to wages for similar work in 
                the local labor market in which the individual resides 
                or is actively seeking work.''.
  (b) Effective Date.--The amendment made by subsection (a) shall apply 
to weeks beginning after the end of the first session of the State 
legislature which begins after the date of enactment of this Act.

SEC. 102. PARTICIPATION IN REEMPLOYMENT SERVICES MADE A CONDITION OF 
                    BENEFIT RECEIPT.

  (a) Social Security Act.--Paragraph (10) of section 303(a) of the 
Social Security Act is amended to read as follows:
          ``(10)(A) A requirement that, as a condition of eligibility 
        for regular compensation for any week--
                  ``(i) a claimant shall meet the minimum educational 
                requirements set forth in subparagraph (B); and
                  ``(ii) any claimant who has been referred to 
                reemployment services shall participate in such 
                services.
          ``(B) For purposes of this paragraph, an individual shall not 
        be considered to have met the minimum educational requirements 
        of this subparagraph unless such individual--
                  ``(i) has earned a high school diploma;
                  ``(ii) has earned the General Educational Development 
                (GED) credential or other State-recognized equivalent 
                (including by meeting recognized alternative standards 
                for individuals with disabilities); or
                  ``(iii) is enrolled and making satisfactory progress 
                in classes leading to satisfaction of clause (ii).
          ``(C) The requirements of subparagraph (B) may be waived for 
        an individual to the extent that the State agency charged with 
        the administration of the State law deems such requirements to 
        be unduly burdensome in the case of such individual.''.
  (b) Internal Revenue Code of 1986.--Paragraph (8) of section 3304(a) 
of the Internal Revenue Code of 1986 is amended to read as follows:
          ``(8) compensation shall not be denied to an individual for 
        any week in which the individual is enrolled and making 
        satisfactory progress in education or training which has been 
        previously approved by the State agency;''.
  (c) Effective Date.--The amendments made by this section shall apply 
to weeks beginning after the end of the first session of the State 
legislature which begins after the date of enactment of this Act.

SEC. 103. STATE FLEXIBILITY TO PROMOTE THE REEMPLOYMENT OF UNEMPLOYED 
                    WORKERS.

  Title III of the Social Security Act (42 U.S.C. 501 and following) is 
amended by adding at the end the following:
                        ``demonstration projects
  ``Sec. 305.  (a) The Secretary of Labor may enter into agreements, 
with States submitting an application described in subsection (b), for 
the purpose of allowing such States to conduct demonstration projects 
to test and evaluate measures designed--
          ``(1) to expedite the reemployment of individuals who 
        establish initial eligibility for unemployment compensation 
        under the State law of such State; or
          ``(2) to improve the effectiveness of a State in carrying out 
        its State law with respect to reemployment.
  ``(b) The Governor of any State desiring to conduct a demonstration 
project under this section shall submit an application to the Secretary 
of Labor. Any such application shall, at a minimum, include--
          ``(1) a general description of the proposed demonstration 
        project, including the authority (under the laws of the State) 
        for the measures to be tested, as well as the period of time 
        during which such demonstration project would be conducted;
          ``(2) if a waiver under subsection (c) is requested, the 
        specific aspects of the project to which the waiver would apply 
        and the reasons why such waiver is needed;
          ``(3) a description of the goals and the expected 
        programmatic outcomes of the demonstration project, including 
        how the project would contribute to the objective described in 
        subsection (a)(1), subsection (a)(2), or both;
          ``(4) assurances (accompanied by supporting analysis) that 
        the demonstration project would not result in any increased net 
        costs to the State's account in the Unemployment Trust Fund;
          ``(5) a description of the manner in which the State--
                  ``(A) will conduct an impact evaluation, using a 
                control or comparison group or other valid methodology, 
                of the demonstration project; and
                  ``(B) will determine the extent to which the goals 
                and outcomes described in paragraph (3) were achieved; 
                and
          ``(6) assurances that the State will provide any reports 
        relating to the demonstration project, after its approval, as 
        the Secretary of Labor may require.
  ``(c) The Secretary of Labor may waive any of the requirements of 
section 3304(a)(4) of the Internal Revenue Code of 1986 or of paragraph 
(1) or (5) of section 303(a), to the extent and for the period the 
Secretary of Labor considers necessary to enable the State to carry out 
a demonstration project under this section.
  ``(d) A demonstration project under this section--
          ``(1) may be commenced any time after the date of enactment 
        of this section; and
          ``(2) may not be approved for a period of time greater than 3 
        years, subject to extension upon request of the Governor of the 
        State involved for such additional period as the Secretary of 
        Labor may agree to, except that in no event may a demonstration 
        project under this section be conducted after the end of the 5-
        year period beginning on the date of enactment of this section.
  ``(e) The Secretary of Labor shall, in the case of any State for 
which an application is submitted under subsection (b)--
          ``(1) notify the State as to whether such application has 
        been approved or denied within 30 days after receipt of a 
        complete application; and
          ``(2) provide public notice of the decision within 10 days 
        after providing notification to the State in accordance with 
        paragraph (1).
Public notice under paragraph (2) may be provided through the Internet 
or other appropriate means. Any application under this section that has 
not been denied within such 30 days shall be deemed approved, and 
public notice of any approval under this sentence shall be provided 
within 10 days thereafter.
  ``(f) The Secretary of Labor may terminate a demonstration project 
under this section if the Secretary makes a final determination that 
the State has violated the substantive terms or conditions of the 
project.''.

SEC. 104. REPEAL OF REGULATION REQUIRING HIGHER STATE TAXES.

  (a) In General.--Section 1202(b)(2) of the Social Security Act is 
amended--
          (1) in subparagraph (A), by inserting ``and'' at the end;
          (2) in subparagraph (B), by striking ``, and'' and inserting 
        a period; and
          (3) by striking subparagraph (C).
  (b) Effective Date.--The amendments made by subsection (a) shall take 
effect as of the date of enactment of this Act.

SEC. 105. RESTORE STATE FLEXIBILITY TO IMPROVE UNEMPLOYMENT PROGRAM 
                    SOLVENCY.

  (a) In General.--Subsection (g) of section 4001 of the Supplemental 
Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304 note) is 
repealed.
  (b) Effective Date.--The amendment made by subsection (a) shall take 
effect as of the date of enactment of this Act.

SEC. 106. DATA STANDARDIZATION FOR IMPROVED DATA MATCHING.

  (a) In General.--Title IX of the Social Security Act is amended by 
adding at the end the following:
           ``data standardization for improved data matching

                        ``Standard Data Elements

  ``Sec. 911. (a)(1) The Secretary of Labor, in consultation with an 
interagency work group established by the Office of Management and 
Budget, and considering State perspectives, shall, by rule, designate 
standard data elements for any category of information required under 
title III or this title.
  ``(2) The standard data elements designated under paragraph (1) 
shall, to the extent practicable, be nonproprietary and interoperable.
  ``(3) In designating standard data elements under this subsection, 
the Secretary of Labor shall, to the extent practicable, incorporate--
          ``(A) interoperable standards developed and maintained by an 
        international voluntary consensus standards body, as defined by 
        the Office of Management and Budget, such as the International 
        Organization for Standardization;
          ``(B) interoperable standards developed and maintained by 
        intergovernmental partnerships, such as the National 
        Information Exchange Model; and
          ``(C) interoperable standards developed and maintained by 
        Federal entities with authority over contracting and financial 
        assistance, such as the Federal Acquisition Regulations 
        Council.

                     ``Data Standards for Reporting

  ``(b)(1) The Secretary of Labor, in consultation with an interagency 
work group established by the Office of Management and Budget, and 
considering State government perspectives, shall, by rule, designate 
data reporting standards to govern the reporting required under title 
III or this title.
  ``(2) The data reporting standards required by paragraph (1) shall, 
to the extent practicable--
          ``(A) incorporate a widely-accepted, non-proprietary, 
        searchable, computer-readable format;
          ``(B) be consistent with and implement applicable accounting 
        principles; and
          ``(C) be capable of being continually upgraded as necessary.
  ``(3) In designating reporting standards under this subsection, the 
Secretary of Labor shall, to the extent practicable, incorporate 
existing nonproprietary standards, such as the eXtensible Business 
Reporting Language.''.
  (b) Effective Date.--The amendment made by this section shall apply 
after September 30, 2012 .

SEC. 107. TECHNICAL AND CONFORMING AMENDMENTS.

  (a) Use of Unemployment Compensation To Repay Overpayments.--Section 
3304(a)(4)(D) of the Internal Revenue Code of 1986 and section 
303(g)(1) of the Social Security Act are amended by striking ``may'' 
and inserting ``shall''.
  (b) Effective Date.--The amendment made by subsection (a) shall apply 
to weeks beginning after the end of the first session of the State 
legislature which begins after the date of enactment of this Act.

      TITLE II--FORWARD FUNDING OF REMAINING FEDERAL UNEMPLOYMENT 
                           COMPENSATION FUNDS

SEC. 201. SPECIAL TRANSFERS TO ALL STATES.

  (a) Special Transfers in Fiscal Years 2011 and 2012.--Section 903 of 
the Social Security Act is amended by adding at the end the following:

           ``Special Transfers in Fiscal Years 2011 and 2012

  ``(h)(1) The Secretary of the Treasury shall transfer (as of the 
dates determined under paragraph (4)) from the extended unemployment 
compensation account to the account of each State in the Unemployment 
Trust Fund the amount determined with respect to such State under 
paragraph (2).
  ``(2)(A) The amount to be transferred to a State under this 
subsection in any fiscal year is the amount derived by multiplying the 
applicable total dollar amount for such fiscal year by the applicable 
fraction for such State.
  ``(B) For purposes of subparagraph (A), the applicable total dollar 
amount is--
          ``(i) for fiscal year 2011, $12,800,000,000; and
          ``(ii) for fiscal year 2012, $18,200,000,000.
  ``(C) For purposes of subparagraph (A), the applicable fraction for a 
State is a fraction--
          ``(i) the numerator of which is the total amount of extended 
        compensation and emergency unemployment compensation paid out 
        by such State for weeks beginning in the 12-month period 
        described in clause (ii); and
          ``(ii) the denominator of which is the total amount of 
        extended compensation and emergency unemployment compensation 
        paid out by all States for weeks beginning in the most recent 
        12-month period for which that information is available for all 
        States as of May 1, 2011.
  ``(3)(A) Except as provided in subparagraph (B), amounts transferred 
to a State account pursuant to this subsection shall be used only in 
the payment of extended compensation and emergency unemployment 
compensation, in accordance with applicable provisions of Federal and 
State law (including agreements and implementing regulations) as in 
effect on May 1, 2011.
  ``(B) A State may, pursuant to specific legislation enacted by the 
legislative body of the State after the date of enactment of the JOBS 
Act of 2011, use money transferred to the State account of such State 
under this subsection for (i) the payment of unemployment compensation, 
(ii) the repayment of advances made to such State under section 1201 
(including interest thereon), and (iii) reemployment services designed 
to enhance the rapid reemployment of unemployed workers (such as 
mandatory workshops, claimant assessments, resume preparation and job 
search assistance, wage subsidy programs, eligibility reviews, labor 
market information, development of a work-search plan, and training), 
if and only if--
          ``(I) the purposes and amounts are specified in the law;
          ``(II) the money is withdrawn and expended, for the purpose 
        described in clause (i), (ii), or (iii) (as the case may be), 
        after the date of enactment of the law; and
          ``(III) the use of the money is accounted for in accordance 
        with standards established by the Secretary of Labor.
  ``(4) Transfers under this subsection shall--
          ``(A) to the extent that they relate to the amount set forth 
        in paragraph (2)(B)(i), be made within 10 days after the date 
        of enactment of this subsection; and
          ``(B) to the extent that they relate to the amount set forth 
        in paragraph (2)(B)(ii), be made after September 30, 2011, and 
        on or before October 10, 2011.''.
  (b) Rule of Construction.--Nothing in section 903(b) of the Social 
Security Act shall be considered to apply with respect to any transfer 
under section 903(h) of such Act (as amended by this section).
  (c) Regulations.--The Secretary of Labor may prescribe any operating 
instructions or regulations necessary to carry out this section and the 
amendment made by this section.

SEC. 202. EMERGENCY UNEMPLOYMENT COMPENSATION TRANSITION RULES.

  (a) Repeal.--Section 4003 of the Supplemental Appropriations Act, 
2008 is repealed.
  (b) Financing.--Section 4004(e)(1) of the Supplemental Appropriations 
Act, 2008 is amended--
          (1) in subparagraph (F), by striking ``and'' after the 
        semicolon; and
          (2) by adding after subparagraph (G) the following:
                  ``(H) the amendment made by section 201 of the Jobs, 
                Opportunity, Benefits, and Services Act of 2011; and''.
  (c) Effective Date of Repeal.--
          (1) In general.--The amendment made by subsection (a) shall 
        be effective with respect to weeks ending after July 6, 2011.
          (2) Rule of construction.--Nothing in this subsection shall 
        be considered to affect the reimbursability of any emergency 
        unemployment compensation paid for a week ending before July 7, 
        2011.

SEC. 203. EXTENDED BENEFITS PROGRAM TRANSITION RULES.

  (a) In General.--Section 2005 of the Assistance for Unemployed 
Workers and Struggling Families Act, as contained in Public Law 111-5 
(26 U.S.C. 3304 note), is amended--
          (1) in subsection (a), by striking ``January 4, 2012'' and 
        inserting ``July 6, 2011'';
          (2) in subsection (b), by striking ``January 4, 2012'' and 
        inserting ``the date of enactment of the JOBS Act of 2011''; 
        and
          (3) by striking subsection (c).
  (b) Termination of Provisions Relating to Temporary Modification of 
Extended Benefit Indicators.--Section 203 of the Federal-State Extended 
Unemployment Compensation Act of 1970, as amended by section 502 of the 
Tax Relief, Unemployment Insurance Reauthorization, and Job Creation 
Act of 2010 (Public Law 111-312; 124 Stat. 3307), is amended--
          (1) in subsection (d) (in the next to last sentence), by 
        striking ``December 31, 2011'' and inserting ``June 30, 2011''; 
        and
          (2) in subsection (f)(2), by striking ``December 31, 2011'' 
        and inserting ``June 30, 2011''.
  (c) Savings Provision.--In the case of any State law which, as of the 
date of enactment of this Act, has been amended in conformance with the 
amendments made by subsection (a) or (b) of section 502 of the Tax 
Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 
2010 (Public Law 111-312; 124 Stat. 3307) and section 2005(a) of the 
Assistance for Unemployed Workers and Struggling Families Act (Public 
Law 111-5; 26 U.S.C. 3304 note), the amendment made by subsection 
(a)(1) shall be disregarded for purposes of any provision of such State 
law which provides for a State ``off'' indicator or which otherwise 
provides for the termination of an extended benefit period by reason of 
the cessation of full Federal funding of sharable extended compensation 
or sharable regular compensation.

SEC. 204. EMERGENCY DESIGNATION.

  The budgetary effects of this Act are designated as an emergency 
requirement and necessary to meet emergency needs pursuant to section 
4(g) of the Statutory Pay-As-You-Go Act of 2010.

                       I. SUMMARY AND BACKGROUND


                         A. Purpose and Summary

    The bill, H.R. 1745, as ordered reported by the Committee 
on Ways and Means on May 11, 2011, would make important reforms 
to the Unemployment Insurance (UI) program designed to help 
more unemployed individuals return to work quickly, while also 
giving States new flexibility in using temporary Federal 
unemployment program funds. To achieve these purposes, the bill 
amends relevant unemployment provisions of the Social Security 
Act, the Internal Revenue Code, the Supplemental Appropriations 
Act of 2008, the Assistance for Unemployed Workers and 
Struggling Families Act, and the Federal-State Extended 
Unemployment Compensation Act of 1970.
    Specifically, Title I of the legislation includes several 
reforms of the UI program designed to promote work, education 
and training, and program integrity, while Title II ``forward 
funds'' remaining temporary Federal unemployment funds to 
States. In Title I, Section 101 sets minimum job search 
requirements in all States for the first time. Section 102 
requires participation in education and other reemployment 
services as a condition of benefit receipt for individuals most 
likely to have difficulty returning to work. Section 103 grants 
States new flexibility to operate cost-neutral ``waiver'' 
programs to promote faster returns to work for unemployed 
workers. Section 104 repeals a regulation that if left in place 
would result in higher State unemployment taxes on jobs in the 
years ahead. Section 105 allows States immediate flexibility to 
improve unemployment program solvency without having to resort 
to raising taxes, repealing a provision enacted in the 2009 
stimulus law. Section 106 requires the U.S. Secretary of Labor 
to designate standard data elements for any category of 
information under Titles III or IX of the Social Security Act, 
in order to improve Unemployment Insurance administration 
program integrity. Section 107 improves the integrity of 
unemployment benefits by directing States to recover more 
unemployment benefit overpayments.
    Section 201 transfers $31 billion in temporary Federal 
unemployment program funds to States in an equitable 
distribution to all States while providing new flexibility in 
how those funds can be used to assist the unemployed. Given 
those transfers, Section 202 provides necessary transition 
rules for one of the current Federal programs, the Extended 
Unemployment Compensation (EUC) program, while section 203 does 
the same for the Federal Extended Benefits (EB) program. 
Section 204 provides for an emergency designation related to 
the budgetary effects of the bill.

               B. Background and the Need for Legislation

    On May 5, 2011, Rep. David Camp (R-MI), Chairman of the 
House Committee on Ways and Means; Rep. Geoff Davis (R-KY), 
Chairman of the Subcommittee on Human Resources of the House 
Committee on Ways and Means; and Rep. Rick Berg (R-ND), a 
Member of the Subcommittee on Human Resources, introduced H.R. 
1745, a bill to improve jobs, opportunity, benefits, and 
services for unemployed Americans, and for other purposes. The 
Committee on Ways and Means received the referral for the bill 
because the bill includes unemployment insurance provisions 
that fall within the jurisdiction of the Committee, including 
relevant provisions of the Social Security Act (SSA), the 
Internal Revenue Code (IRC), the Supplemental Appropriations 
Act of 2008, the Assistance for Unemployed Workers and 
Struggling Families Act, and the Federal-State Extended 
Unemployment Compensation Act of 1970. The Committee found 
three primary problems with the existing Unemployment Insurance 
system: first, it requires reforms to better help unemployed 
Americans prepare for and find jobs; second, rising 
unemployment insurance taxes on jobs are hindering job creation 
and hiring; and third, current federal funds are both poorly 
targeted and lack the flexibility needed to help unemployed 
individuals return to work sooner.

                         C. Legislative History


Background

    H.R. 1745 was introduced on May 5, 2011, and was referred 
to the Committee on Ways and Means.

Committee action

    The Committee on Ways and Means marked up the bill on May 
11, 2011, and ordered the bill as amended favorably reported.

Committee hearings

    On February 10, 2011, the Subcommittee on Human Resources 
of the House Committee on Ways and Means held a hearing on 
improving efforts to help unemployed Americans find jobs. On 
March 11, 2011, the Subcommittee on Human Resources of the 
House Committee on Ways and Means held a hearing on the use of 
data matching to improve customer service, program integrity, 
and taxpayer savings.

                      II. EXPLANATION OF THE BILL


 TITLE I--REFORMS OF UNEMPLOYMENT COMPENSATION TO PROMOTE WORK AND JOB 
                                CREATION


 A. Consistent Job Search Requirements (Sec. 101 of the Bill and Sec. 
                   303(a) of the Social Security Act)


                              PRESENT LAW

    Federal unemployment law does not contain explicit job 
search requirements for the receipt of regular State 
unemployment compensation (UC). Through interpretation of the 
framework of the Federal unemployment laws contained within the 
Social Security Act (SSA) and in the Federal Unemployment Tax 
Act (FUTA), it is generally understood that workers must have 
lost their jobs through no fault of their own and must be able, 
available, and willing to work. Variations exist in State law 
requirements concerning ability and availability for work. Most 
State laws require evidence of ability to work through the 
filing of claims and registration for work at a public 
employment office. Availability for work is often translated to 
mean being ready, willing, and able to work. Meeting the 
requirement of registration for work at a public employment 
office is considered as some evidence of availability.
    Section 202(a)(3)(A) of the Federal-State Extended 
Unemployment Compensation Act of 1970, as amended, does 
explicitly require active job search. However, the method of 
determining active job search is left to the determination of 
the States.

                           REASONS FOR CHANGE

    The Committee believes the lack of a current requirement 
that unemployment insurance recipients engage in meaningful job 
search, along with minimum standards for what that means, is a 
significant omission. The Committee notes that under current 
law, in which State and Federal benefits are payable for up to 
99 weeks under three separate programs, an explicit work search 
requirement applies in only one of those programs--the Extended 
Benefits program that generally provides benefits at the end of 
a worker's time collecting Unemployment Insurance. This is 
exactly backwards--States should expect UI recipients to engage 
in effective job searches from the beginning of their time 
collecting unemployment benefits, not only at the very end of 
their time collecting those benefits. Thus Section 101 of the 
legislation amends the Social Security Act to generally apply 
the current job search standards, similar to those that apply 
under the Extended Benefits program, to all weeks of 
unemployment benefit collection, with appropriate updates to 
assist States in effectively administering this provision.
    A significant body of evidence suggests that effective job 
search requirements increase the likelihood that unemployed 
workers return to work. For example, a 2004 report by the 
Upjohn Institute for Employment Research\1\ summarizes findings 
from numerous studies that have shown how job search 
requirements and job search assistance can significantly reduce 
the length of receipt of unemployment insurance benefits. 
Implementing a standard requirement across the Unemployment 
Insurance system will communicate a uniform message to 
recipients as well as help them more quickly return to the 
workforce.
---------------------------------------------------------------------------
    \1\O'Leary, Christopher. 2004. UI Work Search Rules and Their 
Effects on Employment. Report prepared for the Center for Employment 
Security Education and Research, National Association of State 
Workforce Agencies. Available online: http://research.upjohn.org/
reports/83/.
---------------------------------------------------------------------------
    The Subcommittee on Human Resources, in its February 10, 
2011 hearing on improving efforts to help unemployed Americans 
find jobs, received testimony in support of strengthening job 
search. For example, Kristen Cox, the Executive Director of the 
Utah Department of Workforce Services, noted, ``In Utah, UI 
claimants are required to register for work with the 
department's online job board within five business days of 
their initial claim or they are denied benefits. Starting in 
February this year, Utah has doubled the minimum work search 
requirements to four job contacts per week. Returning to work 
should be a full-time job. Not all States require this type of 
activity.'' Douglas J. Holmes, President of UWC-Strategic 
Services on Unemployment and Workers' Compensation, added, ``In 
a recent survey of state unemployment insurance agencies 
conducted for UWC by the National Foundation for Unemployment 
Compensation and Workers' Compensation, 39 states reported 
exceptions to the general work search requirements and one 
state reported that it had no work search requirement as a 
condition of eligibility for unemployment compensation. 
Exceptions to work search requirements ranged from a general 
exception when the state unemployment rate exceeded 8.5% to 
situations where individuals are attached to prior employment 
and expect to return to work, seek work through hiring halls or 
temporary services, are in approved training, or are between 
terms of employment for a seasonal employer.'' Mr. Holmes 
recommended ``Work search requirements for federal programs and 
standards for State work search requirements should be enacted 
to send the appropriate signal to claimants that active work 
search efforts are expected and required as a condition of 
receiving unemployment compensation. Work search efforts should 
be recorded and verifiable.''
    As a result, the Committee believes that consistent and 
meaningful job search requirements are both appropriate and 
will help more unemployed individuals more quickly return to 
work, which is the Unemployment Insurance program's ultimate 
intent.

                        EXPLANATION OF PROVISION

    The provision creates minimum job search requirements for 
individuals collecting unemployment benefits--ensuring all are 
actively seeking work, have registered for employment services, 
have posted resumes, and have applied for work similar to that 
which the individual previously performed.

                             EFFECTIVE DATE

    The provision becomes effective after the end of the next 
session of each State's legislature.

 B. Participation in Reemployment Services Made a Condition of Benefit 
 Receipt (Sec. 102 of the Bill and Sec. 303(A) of the Social Security 
            Act and Sec. 3304 of the Internal Revenue Code)


                              PRESENT LAW

    Federal law does not require minimum educational standards 
as a condition of benefit receipt. Section 303(a)(9) of the SSA 
requires any claimant who has been referred to reemployment 
services pursuant to the profiling system under Section 
303(j)(1)(B) to participate in such services or in similar 
services unless the State agency charged with the 
administration of the State law determines that (1) such 
claimant has completed such services, or (2) there is 
justifiable cause for such claimant's failure to participate in 
such services.
    Section 303(j) requires the State to use a system of 
profiling all new claimants for regular compensation. The 
profiling system must: (1) identify which claimants will be 
likely to exhaust regular compensation and will need job search 
assistance services to make a successful transition to new 
employment; and (2) refer the identified claimants to 
reemployment services (including job search assistance 
services) that are available under any State or Federal law.
    Section 3304(a)(8) of the IRC requires, as a condition for 
employers in a State to receive normal credit against the 
Federal tax, that a State's unemployment benefits laws provide 
that compensation shall not be denied to an individual for any 
week because he is in training with the approval of the State 
agency (or because of the application, to any such week in 
training, of State law provisions relating to availability for 
work, active search for work, or refusal to accept work). A 
recent Training and Employment Guidance Letter (TEGL) No. 21-
08, among other items, strongly encouraged States to broaden 
their definition of approved training for UC beneficiaries 
during economic downturns.

                           REASONS FOR CHANGE

    The Committee believes changes are needed to the existing 
Unemployment Insurance system so that States better assist 
individuals in receiving the education and other services they 
require to return to work at decent wages.
    First, the bill would generally condition UI receipt for 
individuals without a high school diploma on their making 
progress toward a GED; the provision allows States to waive 
this requirement if it would be ``unduly burdensome'' in 
individual cases--for example involving older workers with 
substantial work experience. This provision responds to clear 
evidence that individuals without a high school diploma are at 
significant risk in current and likely future labor markets. 
For example, according to Bureau of Labor Statistics data,\2\ 
in April 2011 adults without a high school diploma experienced 
an unemployment rate of 14.6 percent--more than 50 percent 
above the level for adults who had graduated from high school. 
Only 39 percent of adults without a high school diploma were 
employed, compared with 55 percent of high school graduates and 
73 percent of college graduates. A February 2011 Brookings 
Institution report\3\ put these differences in context: ``One 
in three people in the United States with less than a high 
school education is either unemployed or underemployed. . . . 
Beyond the immediate difficulties that unemployment causes for 
affected families, these differences in labor market 
participation undermine the country's social fabric.'' The 
provision is designed to expect more unemployed persons without 
a high school diploma to use their time receiving benefits 
productively, helping them return to work sooner and at better 
wages, and whenever possible preventing future instances of 
unemployment.
---------------------------------------------------------------------------
    \2\``Table A-4. Employment status of the civilian population 25 
years and over by educational attainment.'' May 6, 2011. Bureau of 
Labor Statistics. Available online: http://www.bls.gov/news.release/
empsit.to4.htm
    \3\Greenstone, Michael and Looney, Adam. February 4, 2011. A 
Broader Look at the U.S. Employment Situation and the Importance of a 
Good Education. The Brookings Institution. Available online: http://
www.brookings.edu/opinions/2011/0204_jobs_greenstone_looney.aspx
---------------------------------------------------------------------------
    The Subcommittee on Human Resources, at its February 10, 
2011 hearing, received testimony in support of engaging 
individuals in additional education while they collect 
unemployment benefits. For example, as part of a broader 
activity requirement applicable to all unemployment benefit 
recipients, Tom Pauken, the Chairman of the Texas Workforce 
Commission, proposed, ``Those without a high school diploma 
could choose to study for their GED. UI claimants in that 
category would be entitled to first priority for participation 
in existing federally funded Adult Basic Education programs.''
    Second, Section 102 of the bill expects individuals who 
have otherwise been referred to reemployment services by the 
State to participate in those services as a condition of 
eligibility for benefits. The Committee notes that States 
currently must have a system that profiles all new claimants 
for regular compensation, and identifies those most likely to 
exhaust regular compensation and need job search assistance 
services to make a successful transition to new employment. 
While States are expected to refer the identified claimants to 
reemployment services, there is no current requirement that the 
individual participate in services to which they have been 
referred. The Committee notes that, while record numbers have 
been receiving and exhausting unemployment benefits in recent 
years, a very small percentage of unemployment benefit 
recipients are being referred to reemployment services, and 
even fewer are completing them. In 2010 (the most recent 
available data), out of almost 11 million people who started 
collecting unemployment benefits, 2.2 million were referred to 
reemployment services through the worker profiling system; but 
of this number only slightly more than 200,000 reported to a 
training service--only around 10 percent of those referred, and 
less than 2 percent of all recipients.

                        EXPLANATION OF PROVISION

    The provision amends Section 303(a) of the Social Security 
Act and 3304(a) of the Internal Revenue Code to require 
unemployment insurance recipients who lack a high school 
diploma to be making progress toward a GED to remain eligible 
for benefits; it includes a broad exception allowing States to 
waive this requirement if it would be ``unduly burdensome'' in 
individual cases, such as older workers. Separately, the 
provision expects individuals who have otherwise been referred 
to reemployment services by the State to participate in those 
services as a condition of eligibility for unemployment 
benefits.

                             EFFECTIVE DATE

    The provision becomes effective after the end of the next 
session of each State's legislature.

C. State Flexibility To Promote Returns to Work for Unemployed Workers 
   (Sec. 103 of the Bill and Section 305 of the Social Security Act)


                              PRESENT LAW

    Section 3304(a)(4) of the IRC and Section 303(a)(5) of the 
SSA set the withdrawal standards for States to use funds within 
the State account in the Unemployment Trust Fund (UTF). All 
funds withdrawn from the unemployment fund of the State shall 
be used solely in the payment of unemployment compensation, 
exclusive of expenses of administration. Few exceptions exist; 
these include, for instance, withholding for tax purposes, for 
child support payments, to repay UI overpayments or covered 
unemployment compensation debt, and for benefits for the Self-
Employment Assistance program and the Short-Time Compensation 
program.
    Section 303(a)(1) requires that the State UC program 
personnel be merit employees.

                           REASONS FOR CHANGE

    The Committee believes it is appropriate to enact changes 
designed to help more people return to work. Testing innovative 
approaches is an opportunity granted in other areas of social 
policy. As a result, the Committee believes that States should 
have the flexibility to test and evaluate innovative 
demonstration projects within the Unemployment Insurance system 
designed to help more unemployed workers return to work.
    The Committee has long recognized the importance of State 
flexibility and experimentation in social programs. Prior to 
the successful welfare reform efforts undertaken by the 
Committee in the mid-1990s, States were granted waivers from 
certain requirements of welfare law to test new approaches to 
help low-income families become self-sufficient. This 
experimentation with work requirements, time limits, 
eligibility criteria, and alternate types of benefits generated 
a wealth of ideas for reforming the underlying program. These 
ideas were then successfully adopted as part of a broad 
nationwide overhaul of the welfare system, culminating in the 
creation of the Temporary Assistance for Needy Families (TANF) 
program in 1996. Research has shown that in the decade 
following that overhaul, this program played a key role in 
increasing earnings of low-income single mothers and in 
reducing child poverty.
    In addition to welfare waivers, the Committee has also 
provided waiver authority to States in the area of child 
welfare. These waivers allowed States to test ways of better 
serving children in foster care and other programs, and the 
results from successful child welfare waiver experiments also 
have been incorporated into Federal law, which has both 
improved the lives of children and ensured that money is well 
spent.
    Expanding this practice of providing waivers to include 
State Unemployment Insurance programs may yield tangible short-
term gains for individuals while also providing valuable 
information that can inform Federal policymaking in the future.

                        EXPLANATION OF PROVISION

    The provision allows States to apply for cost-neutral 
``waivers'' of Federal unemployment law, so they can test 
innovative strategies to promote more and faster reemployment 
of unemployed workers.

                             EFFECTIVE DATE

    This provision becomes effective on the date of enactment 
of the Act.

 D. Repeal of Regulation Requiring Higher State Taxes (Sec. 104 of the 
          Bill and Sec. 1202(b)(2) of the Social Security Act)


                              PRESENT LAW

    Programmatically, the U.S. Labor Department has long 
suggested a State's balance account within the Unemployment 
Trust Fund (UTF) should provide for one year's projected 
benefit payment needs on the basis of the highest levels of 
benefit payments experienced by the State over the last three 
business cycles. This is called the average high-cost multiple 
(AHCM). A ratio of 1.0 or greater prior to a recession would be 
considered to be minimally solvent.
    Section 1202(b)(2) of the SSA allows States to borrow funds 
without interest from the Federal Unemployment Account (FUA) 
within the UTF during the year. To receive these interest-free 
loans, States must meet three conditions:
    (A) States must repay the loans by September 30 of the 
fiscal year.
    (B) For those loans to maintain their interest-free status, 
there cannot be any loans made to that State in October, 
November, or December of the calendar year of such an interest-
free loan. If loans are made in the last quarter of the 
calendar year, the ``interest-free'' loans made in the previous 
fiscal year will retroactively accrue interest charges.
    (C) States must meet funding goals relating to their 
account in the UTF, established by the Secretary of Labor under 
42 C.F.R. Sec. 503(c)(3).
    42 C.F.R. Sec. 503(c)(3) requires that by 2019, States must 
have had at least one year in the past five calendar years 
before the year in which loans are taken where the ratio of its 
trust fund balance to the average highest cost multiple (AHCM) 
is at least 1.0. Additionally, States must meet two criteria 
for maintenance of tax effort in every year from the most 
recent year the AHCM was at least 1.0 and the year in which 
advances are taken: The average State unemployment tax rate 
(the ratio of total State tax amount collected over the total 
taxable wages) was at least 80% of the prior year's rate; and, 
the average State unemployment tax rate is at least 75% of the 
average benefit-cost ratio over the preceding five calendar 
years, where the benefit-cost ratio for a year is defined as 
the amount of benefits and interest paid in the year divided by 
the total covered wages paid in the year.

                           REASONS FOR CHANGE

    The Committee is concerned that the solvency standard that 
the U.S. Department of Labor has proposed would not be 
reasonably attainable in many States, especially given the 
large number of States with current negative balances, 
including the more than 30 that have had to resort to a 
combined over $40 billion in borrowing from the Federal 
government to date. Thus the enforcement of the proposed 
solvency standard in the future would have the effect of either 
(1) forcing steep benefit reductions or even greater 
unemployment tax increases on jobs than are already taking 
effect due to the recession, further harming job creation and 
hiring, or (2) permanently denying States the ability to access 
short-term interest-free borrowing that would otherwise be 
available to assist them in paying unemployment benefits in a 
future downturn. Neither outcome is acceptable, and thus 
section 104 repeals the U.S. Department of Labor regulation.

                        EXPLANATION OF PROVISION

    The provision amends Section 1202(b)(2) of the Social 
Security Act by repealing a September 17, 2010 U.S. Department 
of Labor regulation on funding goals that would be made a 
condition of a State's ability to receive interest-free 
advances from the Federal Government for the payment of 
unemployment insurance.

                             EFFECTIVE DATE

    The provision becomes effective on the date of enactment of 
the Act.

 E. State Flexibility To Improve Unemployment Program Solvency Without 
 Raising Taxes (Sec. 105 of the Bill and Sec. 4001 of the Supplemental 
                       Appropriations Act, 2008)


                              PRESENT LAW

    Section 4001(g) of the Supplemental Appropriations Act of 
2008 (P.L. 110-252), as amended, currently prevents States from 
decreasing the average weekly benefit amount of regular UC 
payments. That is, a State is not permitted to pay an average 
weekly UC benefit that is less than what would have been paid 
under State law prior to what was in effect on June 2, 2010. 
This ``nonreduction rule'' is a condition of the EUC08 Federal-
State agreement of P.L. 110-252, as amended.

                           REASONS FOR CHANGE

    The current ``nonreduction rule'' was originally applied in 
the 2009 stimulus law as an effort to ensure States maintain 
their own unemployment benefit payments while the Federal 
government was providing an additional $25 per week in 
``Federal additional compensation.'' The Committee believes 
this current rule should be eliminated for several reasons.
    First, ``Federal additional compensation'' is no longer 
payable, having ended in December 2010. Thus the original 
purpose for which this provision was created--to ensure that 
States do not reduce State benefit levels while a special 
Federal benefit of $25 was payable--no longer exists.
    Second, this provision effectively forces States that wish 
to improve the solvency of their UI programs to raise taxes, 
rather than also consider appropriate benefit reductions. In 
all prior recessions, States used both those tools to improve 
the solvency of their unemployment programs. This 
``nonreduction rule'' has thus likely contributed to the steep 
rise in State unemployment taxes in recent years; State 
unemployment taxes will have risen by 44 percent between fiscal 
year 2009 (when this provision took effect) and 2011, according 
to U.S. Department of Labor statistics in their Fiscal Year 
2012 UI Outlook.
    Finally, repeal of this provision is consistent with the 
additional flexibility provided States under the provisions of 
Title II of the JOBS Act, described below.

                        EXPLANATION OF PROVISION

    The legislation repeals a provision in section 4001 of the 
Supplemental Appropriations Act, 2008, that since the 2009 
stimulus law has blocked States that want to improve solvency 
from reducing State unemployment benefits while still receiving 
Federal extended benefit funds. The provision being repealed 
has left States no choice but to raise taxes on jobs if they 
want to improve unemployment program solvency.

                             EFFECTIVE DATE

    The provision becomes effective on the date of enactment of 
the Act.

  F. Data Standardization for Improved Data Matching (Sec. 106 of the 
             Bill and Title IX of the Social Security Act)


                              PRESENT LAW

    There are currently no specific Federal laws or regulations 
related to uniform data elements for data matching in the 
Federal-State unemployment insurance system. Section 303(a)(6) 
of the SSA requires States to make reports of information and 
data as required by the U.S. Secretary of Labor. But current 
Federal law contains no precise requirements regarding codes or 
identifiers attached to UC, EUC08, or EB program data or any 
other data standards.

                           REASONS FOR CHANGE

    The Committee believes the programs within its jurisdiction 
should, from an information technology standpoint, operate 
consistently within and across programs. By beginning the 
process of data standardization and the use of common reporting 
mechanisms in this section, the Committee is achieving three 
goals: better preventing and identifying fraud and abuse; 
increasing the efficiency of administrative resources; and 
producing program savings for U.S. taxpayers. The private 
sector is decades ahead in its ability to use data efficiently 
to detect patterns of misuse, such as when credit cards are 
lost or stolen, and streamlining backend data processing. The 
public sector needs to review those best practices to better 
improve the operation of public benefit programs, prevent and 
identify fraud and abuse, and improve recovery of misspent 
taxpayer funds. The first step is organizing the data, as this 
section directs the Secretary to do starting with the 
Unemployment Insurance program.
    The Subcommittee on Human Resources, in its March 11, 2011 
hearing on the use of data matching to improve customer 
service, program integrity, and taxpayer savings, received 
testimony in support of consistent data standards that are non-
proprietary and promote the interoperability of data across 
various information technology platforms, including State 
legacy systems. The hearing confirmed that not only are 
programs within the Subcommittee's jurisdiction in silos, but 
so is the accompanying data. Improved data standards will help 
increase the efficiency of data exchanges to use and reuse data 
within and across programs. In the Unemployment Insurance 
program, consistent data standards will allow States to 
automate the exchange of claimant data on work and benefit 
receipt, reducing delays and minimizing improper payments. It 
will also help to automate application forms by pre-populating 
them with reliable and verified data, which can reduce the 
manual burden on staff and allow them more time to engage 
individuals in reemployment services, all while reducing error.
    Therefore, the Committee believes that non-proprietary, 
interoperable data standards in the Unemployment Insurance 
program are the first step to better organizing and using data 
to address fraud and abuse and increase administrative 
efficiency. This process will have the additional important 
benefit of improving the services the program provides to 
unemployed individuals in their efforts to return to work.

                        EXPLANATION OF PROVISION

    The provision directs the U.S. Secretary of Labor to 
develop standardized data elements to be used in improving the 
accuracy and administration of unemployment benefits.

                             EFFECTIVE DATE

    The provision becomes effective on October 1, 2012.

 G. Technical and Conforming Amendments (Sec. 107 of the Bill and Sec. 
  3304(a)(4) of the Internal Revenue Code and 303(g)(1) of the Social 
                             Security Act)


                              PRESENT LAW

    Section 3304(a)(4)(D) of the IRC allows States to deduct 
overpayments from current benefits, as authorized in Section 
303(g)(1) of the SSA. Under current law, this deduction of 
overpayments from unemployment benefit payments is optional for 
States, which ``may'' carry out this provision (or may not). 
Many States grant waivers--in cases of extreme hardship for 
individuals, for example--or do not require this deduction of 
overpayments for every case.

                           REASONS FOR CHANGE

    The Committee believes in the need to strengthen program 
integrity, including the collection of benefit overpayments. 
Data reflecting benefit payments made in 2009 reveal 
unemployment overpayments continue to increase in both 
percentage and absolute dollar terms. A large part of the 
absolute increase is due to the significant rise in total 
unemployment benefits paid. The most recent data indicates an 
overpayment rate of 10.6%, and a total of $16.5 billion in 
annual overpayments. Recoverable overpayments estimated by the 
Benefit Accuracy Measurement (BAM) survey increased from $2.8 
billion in FY 2009 to $4.0 billion in FY 2010, as benefits paid 
increased. The conforming amendment in the legislation is 
designed to enhance the States' ability to efficiently recover 
such rising overpayments from current benefits, with limited 
additional administrative burdens. It is also consistent with 
overpayment collection methods in other programs, as well as 
the Treasury Offset Program designed to collect unemployment 
benefits overpayments from Federal tax refunds.

                        EXPLANATION OF PROVISION

    The provision requires States to reduce current 
unemployment benefits to recover prior unemployment benefit 
overpayments.

                             EFFECTIVE DATE

    The provision becomes effective after the end of the next 
session of each State's legislature.

 TITLE II--FORWARD FUNDING REMAINING FEDERAL UNEMPLOYMENT COMPENSATION


 A. Special Transfers to All States (Sec. 201 of the Bill and Sec. 903 
                      of the Social Security Act)


                              PRESENT LAW

    All unemployment benefits--including Federal unemployment 
benefits (i.e., the Extended Benefit (EB) and Emergency 
Unemployment Compensation (EUC08) programs)--are mandatory 
entitlements paid out to individuals who meet certain 
eligibility requirements. These benefit payments are not 
appropriated by Congress under current law. Regular UC benefits 
are financed through States taxes on employers.
    Under permanent law in Section 204(a)(1) of the Federal-
State Extended Unemployment Compensation Act of 1970 (P.L. 91-
373), the cost of EB benefits are shared, with half (50%) of EB 
funded by the Federal government and States funding the other 
half (50%).
    Section 2005(a) of the American Recovery and Reinvestment 
Act of 2009 (P.L. 111-5), as amended, temporarily changes the 
Federal-State funding arrangement. The Federal government 
finances 100% of EB benefits until January 4, 2012, with the 
exception of ``non-sharable'' benefits (generally, these are 
former State and local employees' EB benefits). For individuals 
who were receiving EB payments on January 4, 2012, the Federal 
government will continue to pay 100% of EB benefits for the 
duration of these individuals' benefits (but not for new 
entrants to the EB program starting after that date).
    Section 4004(e)(1) of the Supplemental Appropriations Act 
of 2008 (P.L. 110-252), as amended, finances EUC08 benefits 
from general funds of the U.S. Treasury through the expiration 
of the EUC08 program the week ending on or before January 3, 
2012. States do not need to repay these funds.
    Under Section 4001(a) of the Supplemental Appropriations 
Act of 2008 (P.L. 110-252), as amended, a State has the option 
to terminate the Federal-State EUC08 agreement with 30 days 
notice to the U.S. Department of Labor.

                           REASONS FOR CHANGE

    Due to the record amount of unemployment benefits paid 
since the start of the recession in 2007, most States have been 
forced to dramatically increase unemployment taxes on jobs, 
compromising employers' ability to hire new workers. Meanwhile, 
under temporary Federal measures that expire in December 2011, 
States will be paid about $31 billion in Federal unemployment 
funds, but under current law none of that money can be used to 
mitigate those steep tax hikes on jobs or otherwise provide 
services to help more unemployed individuals return to work. 
Instead, all of these temporary Federal funds must be spent on 
a highly prescriptive system of 100% Federally-funded 
unemployment benefits lasting up to 73 weeks, which when 
combined with 26 weeks of State Unemployment Insurance 
benefits, means unemployment checks in half of the States now 
last up to 99 weeks per person--or nearly two years. The 
current maximum of 73 weeks of 100% Federally-funded benefits 
is 40 weeks longer than has ever been provided in any other 
recession, and 47 weeks beyond the typical maximum of 26 weeks 
of 100% Federally-funded benefits. Title II of this 
legislation, and specifically section 201, is designed to 
bridge this divide by providing all States new flexibility in 
spending their share of the $31 billion in remaining temporary 
Federal unemployment funds. Under section 201, States must use 
this money to continue paying current Federal unemployment 
benefits, unless they pass laws to use the funds differently 
within the bounds of the Unemployment Insurance system, 
including to promote more job creation and hiring.
    Specifically, by passing a new State law, States could 
spend these temporary Federal funds within the UI system for 
any of the following purposes: (1) to support State 
unemployment benefits without the need for higher taxes or 
additional borrowing; (2) to provide reduced weeks of extended 
benefits after workers exhaust State benefits (or even 
increased weeks for certain individuals or groups, subject to 
the fixed amount of funds provided); (3) to repay Federal 
unemployment loans States have taken to pay past unemployment 
benefits or to pay the interest on those loans, without having 
to raise State unemployment taxes; or (4) to provide 
reemployment services, including wage subsidies, promoting 
reemployment and job creation.
    States with unemployment loans would not have their 
interest charges waived, but instead could better target 
current Federal funds and use any savings to prevent job-
destroying unemployment tax hikes. Under current law up to 99 
weeks of total unemployment benefits are paid across most of 
the U.S., including up to 73 weeks of Federal benefits, an all-
time record. But 70 percent of the Federal spending to date 
behind those 73 weeks of benefits has been untargeted, as the 
money has been spent without regard to the State's unemployment 
rate. For example, under current law, in North Dakota where the 
unemployment rate is 3.6 percent, unemployed workers collect 
over a year of total benefits, including 34 weeks of Federal 
unemployment benefits. Even in States with unemployment rates 
as low as 6.5 percent--which is significantly below the current 
9.0 percent national average--as many as 60 weeks of Federal 
benefits are payable after someone exhausts 26 weeks of State 
benefits, for a total of 86 weeks of benefits. Section 201 of 
the legislation allows States to decide whether these Federal 
rules make sense given local conditions, and if not, to choose 
to spend money that has already been committed more wisely 
within the unemployment insurance system, by passing a law to 
that effect.
    The Congressional Budget Office expects that current 
temporary Federal unemployment benefits law will result in $31 
billion in Federal spending during the remainder of FYs 2011 
and 2012. Section 201 equitably divides that $31 billion in 
expected spending among the States, according to their share of 
Federal unemployment benefits spending in the past 12 months.

                        EXPLANATION OF PROVISION

    The provision forward funds to State unemployment accounts 
the expected $31 billion in remaining temporary Federal 
unemployment funds. Funds will be provided in FY 2011 ($12.8 
billion, transferred within 10 days of enactment) and FY 2012 
($18.2 billion, transferred between October 1st and 10th, 
2011). State shares of the $31 billion will be equal to their 
share of Federal unemployment benefit spending in the most 
recent 12 months. This provision also requires States to spend 
these funds: (1) to pay current Federal unemployment benefits; 
or (2) as specified by a State law passed after enactment, for 
regular or extended unemployment benefits, for repaying Federal 
unemployment loans (or interest on those loans), or for 
reemployment services such as wage subsidies, job search 
assistance, and other services designed to promote rapid 
reemployment.

                             EFFECTIVE DATE

    The provision becomes effective on the date of enactment of 
the Act.

 B. Emergency Unemployment Compensation Transition Rules (Sec. 202 of 
       the Bill and Sec. 4003 and 4004(e)(1) of the Supplemental 
                       Appropriations Act, 2008)


                              PRESENT LAW

    Section 4001 of the Supplemental Appropriations Act of 2008 
(P.L. 110-252), as amended, allows all States to enter into a 
Federal-State agreement to make EUC08 payments to eligible 
individuals. As described above, EUC08 benefit payments are 
currently financed from general funds of the U.S. Treasury 
until the expiration of the EUC08 program the week ending on or 
before January 3, 2012.
    Section 4001(a) of the Supplemental Appropriations Act of 
2008 (P.L. 110-252, as amended) provides a State with the 
option to terminate the Federal-State EUC08 agreement with 30 
days notice to the U.S. Department of Labor.
    Section 4003(a) of the Supplemental Appropriations Act of 
2008 (P.L. 110-252), as amended, authorizes payments to States 
with Federal-State agreements from the U.S. Treasury for the 
purposes of EUC08 benefits.

                           REASONS FOR CHANGE

    The provisions of Section 201 forward fund all of the 
remaining Federal Emergency Unemployment Compensation (EUC) 
program funds to States.  Consistent with that, Section 202 
ends the current monthly payment mechanism for that program, 
which is no longer needed.

                        EXPLANATION OF PROVISION

    Since Section 201 forward funds to all States their 
expected share of remaining Federal EUC funds payable during 
the remainder of that program, this section repeals the current 
monthly payment system used by that program. It also includes a 
technical provision adding this legislation to the list of 
unemployment laws for which general funds may be transferred.

                             EFFECTIVE DATE

    The repeal of current monthly payments to States is 
effective with respect to weeks ending after July 6, 2011.

 C. Extended Benefits Program Transition Rules (Sec. 203 of the Bill, 
   Sec. 2005 of the Assistance for Unemployed Workers and Struggling 
  Families Act, Sec. 203 and 204(a)(1) of the Federal-State Extended 
Unemployment Compensation Act of 1970, and Sec. 502 of the Tax Relief, 
      Unemployment Reauthorization, and Job Creation Act of 2010)


                              PRESENT LAW

    As detailed above, EB benefits are temporarily 100% 
Federally financed (Section 2005(a) of the American Recovery 
and Reinvestment Act of 2009 (P.L. 111-5), as amended). Under 
current law, the Federal government finances 100% of EB 
benefits until January 4, 2012 with the exception of 
``nonsharable'' benefits (benefits for persons who worked for 
employers that are not subject to Federal Unemployment Taxes 
such as former State employees). The Federal government will 
continue to pay 100% of EB benefits for the duration of these 
individuals' benefits for individuals receiving EB payments on 
January 4, 2012, but not for new entrants to the EB program 
after that date.
    In addition, Section 502 of the Tax Relief, Unemployment 
Insurance Reauthorization, and Job Creation Act of 2010 (P.L. 
111-312) amends Sections 203(d) & (f) of the Federal-State 
Extended Unemployment Compensation Act of 1970 (P.L. 91-373) to 
allow States to temporarily use lookback calculations for their 
EB trigger based on three years of unemployment rate data 
(rather than the current lookback of two years of data) as part 
of their mandatory and/or optional EB triggers if States would 
otherwise trigger off or not be on a period of EB benefits. 
States implement the lookback changes individually by amending 
their State Unemployment Compensation laws. This temporary 
option to use three-year EB trigger lookbacks expires the week 
on or before December 31, 2011. As of May 8, 2011, 23 States 
have enacted State laws to adopt a three-year lookback for one 
or more of the EB program triggers.

                           REASONS FOR CHANGE

    The Committee believes that States should be provided 
flexibility to support Unemployment Insurance beneficiaries in 
returning to work by forward funding remaining Federal extended 
benefit dollars to the States. However, if States take no 
additional action, the Committee intends for benefits to 
continue to be paid under current temporary Federal policies.

                        EXPLANATION OF PROVISION

    The provisions of Section 201 forward fund all of the 
remaining Federal Extended Benefit (EB) program funds to States 
associated with temporary expansions of that program, 
specifically policies that provide for 100 percent Federal 
funding and a three-year lookback that has allowed more States 
to qualify for the program in CY 2011. Consistent with that 
forward funding approach in Section 201, Section 203 ends those 
temporary expansions, since States will receive the funds 
associated with those policies.
    This section includes a technical ``savings provision'' 
designed to ensure that, if States take no additional action, 
EB program benefits continue to be paid automatically, despite 
State laws that express that the program will only be 
operational as long as they receive 100% Federal funding or 
apply a three-year lookback.

                             EFFECTIVE DATE

    In general, these provisions are effective on July 1, 2011.

            D. Emergency Designation (Sec. 204 of the Bill)


                              PRESENT LAW

    Section 204 of this legislation designates the budgetary 
effects of H.R. 1745 as an emergency requirement and 
``necessary to meet emergency needs pursuant to section 4(g) of 
the Statutory Pay-As-You-Go Act of 2010.''

                           REASONS FOR CHANGE

    The Committee believes current emergency funds should be 
repurposed to provide greater flexibility to States and that 
this will help more people return to work. Because of this 
repurposing, the legislation needs to carry an emergency 
designation.

                        EXPLANATION OF PROVISION

    Section 204 is a technical provision required because the 
underlying provisions amended in Title II originally carried an 
emergency designation. Because it amends the purposes for which 
funds payable under those provisions may be spent, the 
legislation also needs to carry an emergency designation.

                             EFFECTIVE DATE

    The provision is effective upon the date of enactment of 
the Act.

                      III. VOTES OF THE COMMITTEE

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the following statements are made 
concerning the votes of the Committee on Ways and Means in its 
consideration of the bill, H.R. 1745.
    The bill H.R. 1745 was ordered favorably reported, as 
amended, by a rollcall vote of 20 yeas to 14 nays (with a 
quorum being present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
         Representative             Yea       Nay     Present     Representative      Yea       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Camp.......................        X   ........  .........  Mr. Levin........  ........        X   .........
Mr. Herger.....................        X   ........  .........  Mr. Rangel.......  ........        X   .........
Mr. Johnson....................  ........  ........  .........  Mr. Stark........  ........        X   .........
Mr. Brady......................        X   ........  .........  Mr. McDermott....  ........        X   .........
Mr. Ryan.......................        X   ........  .........  Mr. Lewis........  ........  ........  .........
Mr. Nunes......................        X   ........  .........  Mr. Neal.........  ........        X   .........
Mr. Tiberi.....................        X   ........  .........  Mr. Becerra......  ........        X   .........
Mr. Davis......................        X   ........  .........  Mr. Doggett......  ........        X   .........
Mr. Reichert...................        X   ........  .........  Mr. Thompson.....  ........        X   .........
Mr. Boustany...................        X   ........  .........  Mr. Larson.......  ........        X   .........
Mr. Roskam.....................        X   ........  .........  Mr. Blumenauer...  ........        X   .........
Mr. Gerlach....................        X   ........  .........  Mr. Kind.........  ........        X   .........
Mr. Price......................        X   ........  .........  Mr. Pascrell.....  ........        X   .........
Mr. Buchanan...................        X   ........  .........  Ms. Berkley......  ........        X   .........
Mr. Smith......................        X   ........  .........  Mr. Crowley......  ........        X   .........
Mr. Schock.....................        X   ........  .........
Ms. Jenkins....................        X   ........  .........
Mr. Paulsen....................        X   ........  .........
Mr. Marchant...................        X   ........  .........
Mr. Berg.......................        X   ........  .........
Ms. Black......................        X   ........  .........
----------------------------------------------------------------------------------------------------------------

                          VOTES ON AMENDMENTS

    The Davis Amendment to the Amendment in the Nature of a 
Substitute to H.R. 1745 passed by voice vote (with a quorum 
being present).
    The Doggett Amendment to the Amendment in the Nature of a 
Substitute to H.R. 1745 failed by voice vote (with a quorum 
being present).

                     IV. BUDGET EFFECTS OF THE BILL


               A. Committee Estimate of Budgetary Effects

    In compliance with clause 3(d) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the effects on the budget of the revenue provisions 
of the bill, H.R. 1745 as reported: The Committee agrees with 
the estimates prepared by the Congressional Budget Office 
(CBO), which are included below.

 STATEMENT REGARDING NEW BUDGET AUTHORITY AND TAX EXPENDITURES BUDGET 
                               AUTHORITY

    The bill as reported is not in compliance with clause 
3(c)(2) of rule XIII of the Rules of the House of 
Representatives. However, the Chairman of the Committee on Ways 
and Means has already provided an amendment in the nature of a 
substitute to the Committee on Rules to bring the bill into 
compliance with clause 3(c)(2) of rule XIII of the Rules of the 
House of Representatives. The amendment makes technical and 
conforming changes to Section 203 of the legislation, which 
were brought to the Committee's attention after markup and are 
designed to ensure that individuals currently eligible for 
Extended Benefits remain eligible and that States are not able 
to claim additional matching payments since the bill already 
provides full Federal funding for those benefits.
    Once the technical and conforming changes are made to 
section 203, the Committee will be able to state that the bill 
involves no new or increased budgetary authority. The Committee 
will also be able to state further that the bill involves no 
new or increased tax expenditures.
    As a result, the Committee has requested CBO provide an 
estimate for the bill as reported as well as for the amendment 
in the nature of a substitute containing the technical and 
conforming changes needed to comply with both the Committee's 
intent and House rules on deficit reduction.

      B. Cost Estimate Prepared by the Congressional Budget Office

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, requiring a cost estimate 
prepared by the CBO, the following statement by CBO is 
provided:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 23, 2011.
Hon. Dave Camp,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1745, the Jobs, 
Opportunity, Benefits, and Services Act of 2011.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Christina 
Hawley Anthony.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 1745--Jobs, Opportunity, Benefits, and Services Act of 2011

    Summary: H.R. 1745 would, beginning in July 2011, repeal 
provisions that allow federal reimbursements for the emergency 
unemployment compensation program (EUC), temporarily provide 
full federal funding for extended benefits (EB), and allow 
states to make it easier to provide EB. The legislation also 
would temporarily suspend the 50 percent federal match for EB 
through December 2011.
    Additionally, enacting the bill would provide special 
distributions to the states in 2011 and 2012 totaling $31 
billion, which states could use to continue to provide EUC and 
EB (as those programs existed on May 1, 2011), or pay for other 
unemployment-related expenses, including any interest due on 
loans from the unemployment trust fund (UTF).
    Finally, H.R. 1745 would require states to reduce 
unemployment benefits to individuals who have received 
overpayments, require individuals to meet certain criteria for 
receipt of benefits, and direct the Department of Labor to 
establish uniform reporting codes.
    CBO estimates that enacting H.R. 1745 would reduce outlays 
by $125 million in 2011 and by $3.1 billion over the 2011-2021 
period. Under the bill, revenues also would decline by $2.4 
billion over the 2011-2021 period. On balance, enacting H.R. 
1745 would reduce deficits by approximately $0.7 billion over 
the 2011-2021 period. Implementing the bill would not have a 
significant effect on discretionary spending.
    Pay-as-you-go procedures apply because enacting the 
legislation would affect direct spending and revenues.
    H.R. 1745 would impose no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act 
(UMRA).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 1745 is shown in the following table. 
The costs of this legislation fall within budget function 600 
(income security).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        By fiscal year, in millions of dollars--
                              --------------------------------------------------------------------------------------------------------------------------
                                 2011     2012      2013      2014     2015     2016     2017     2018     2019     2020     2021   2011-2016  2011-2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               CHANGES IN DIRECT SPENDING

Estimated Budget Authority...     -125    -2,835       -15      -15      -15      -15      -15      -15      -15      -15      -15     -3,020     -3,095
Estimated Outlays............     -125    -2,835       -15      -15      -15      -15      -15      -15      -15      -15      -15     -3,020     -3,095

                                                                   CHANGES IN REVENUES

Estimated Revenues...........        0        -8      -211     -616     -617     -477     -233     -185      -38      -11      -11     -1,929     -2,407

                                NET INCREASE OR DECREASE (-) IN THE DEFICIT FROM CHANGES IN DIRECT SPENDING AND REVENUES

Estimated Impact on the           -125    -2,827       196      601      602      462      218      170       23       -4       -4     -1,091       -688
 Deficit.....................
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Basis of estimate: For the purpose of this estimate, CBO 
assumes H.R. 1745 will be enacted by July 1, 2011. Later 
enactment could change the estimate significantly.
    H.R. 1745 would repeal the federal funding for EUC for 
weeks of unemployment ending after July 6, 2011. In addition, 
H.R. 1745 would terminate temporary aspects of the EB program 
that extend 100 percent federal funding for that program and 
make it easier for states to meet the unemployment rate 
thresholds required to provide benefits. The bill also would 
temporarily suspend the 50 percent federal match for EB through 
December 2011.

Direct Spending

    The bill would transfer $12.8 billion to states for fiscal 
year 2011 and $18.2 billion for fiscal year 2012. States could 
use those funds to operate EUC and EB as they existed in state 
agreements as of May 1, 2011. However, the total amount that 
would be transferred is about $0.6 billion lower than the 
amounts CBO projects states will spend on EUC and special EB 
under current law. (Under current law, EUC and the temporary EB 
provisions are authorized through December 2011; states may 
terminate agreements to provide EUC by giving 30 days' notice 
to the Department of Labor.) A state could use the transferred 
funds for other unemployment-related purposes, including paying 
interest due on loans from the UTF, but such changes would 
require state legislation.
    CBO estimates that most states would continue to operate 
EUC and EB programs using their share of the total $31 billion 
in transfers that would be provided by H.R. 1745. However, CBO 
expects that some states would opt out of EUC, provide fewer 
benefits under EB, or change their laws to use a portion of the 
funds for other purposes. CBO estimates that such changes would 
decrease outlays for EUC and EB by $125 million in 2011 and 
$2.8 billion in 2012.
    The bill also would direct states to offset overpayments of 
unemployment compensation by reducing benefits to individuals, 
harmonize job search requirements, and mandate recipients of 
unemployment compensation to meet a minimum education threshold 
(though that requirement could be waived in cases of hardship). 
CBO estimates those provisions would reduce outlays by about 
$15 million per year beginning in 2013.

Revenues

    Provisions in H.R. 1745 would affect states' revenues for 
unemployment compensation, which are reflected on the federal 
budget. Lower outlays would result in higher balances in 
states' unemployment trust funds. CBO estimates that some 
states would respond to the higher balances by reducing their 
unemployment taxes (or by avoiding tax increases assumed in the 
baseline that would replenish the trust funds). As a result, 
CBO estimates that, on net, revenues would decline by $2.4 
billion over the 2011-2021 period under H.R. 1745.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays and revenues that are 
subject to those pay-as-you-go procedures are shown in the 
following table. Under H.R. 1745, there would be no net impact 
for purposes of enforcing the Statutory Pay-As-You-Go Act 
because the bill would designate the bill's effects as an 
emergency requirement.

       CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 1745 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON MAY 11, 2011, WITH SUBSEQUENT LANGUAGE PROVIDED ON MAY 18, 2011
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                              By fiscal year, in millions of dollars--
                                                                  ------------------------------------------------------------------------------------------------------------------------------
                                                                     2011     2012      2013     2014     2015     2016     2017     2018     2019     2020     2021   2011-2016     2011-2021
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           NET INCREASE OR DECREASE (-) IN THE DEFICIT

Total change.....................................................     -125    -2,827      196      601      602      462      218      170       23       -4       -4     -1,091            -688
Less:
    Designated as Emergency Requirementsa........................      125     2,827     -196     -601     -602     -462     -218     -170      -23        4        4      1,091             688
Statutory Pay-As-You Go Impact...................................        0         0        0        0        0        0        0        0        0        0        0          0               0
Memorandum:
    Change in Outlays............................................     -125    -2,835      -15      -15      -15      -15      -15      -15      -15      -15      -15     -3,020          -3,095
    Change in Revenues...........................................        0        -8     -211     -616     -617     -477     -233     -185      -38      -11      -11     -1,929         -2,407
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
aSection 204 of H.R. 1745 would designate the budgetary effects of the bill as an emergency requirement pursuant to section 4(g) of the Statutory Pay-As-You-Go Act of 2010.

    Intergovernmental and private-sector impact: H.R. 1745 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. CBO estimates that changes to the unemployment 
compensation program would result in lower federal transfers to 
the states than under current law and also would result in 
decreases in unemployment taxes in some states. These effects, 
however, would result from states' participation in the federal 
unemployment insurance program, which is voluntary, and would 
not result from intergovernmental mandates as defined in UMRA.
    Previous CBO estimate: On May 23, 2011, CBO transmitted an 
estimate of the budgetary effects of H.R. 1745, as ordered 
reported by the House Committee on Ways and Means on May 11, 
2011. That version of the bill would allow states to receive a 
federal match of 50 percent of the costs of EB beginning in 
July 2011, and, in CBO's estimation, would result in a net 
increase in federal deficits of $4 million over the 2011-2021 
period. The amendment in the nature of a substitute would 
temporarily suspend that matching provision, and as a result 
would result in savings over the 2011-2021 period of $0.7 
billion.
    Estimate prepared by: Federal Spending: Christina Hawley 
Anthony; Federal Revenues: Barbara Edwards; Impact on State, 
Local, and Tribal Governments: Lisa Ramirez-Branum; Impact on 
the Private Sector: Sarah Axeen.
    Estimate approved by: Peter H. Fontaine, Assistant Director 
for Budget Analysis; Frank Sammartino; Assistant Director for 
Tax Analysis.
                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 23, 2011.
Hon. Dave Camp,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1745, the Jobs, 
Opportunity, Benefits, and Services Act of 2011.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Christina 
Hawley Anthony.
            Sincerely,
                                              Douglas W. Elmendorf.
    Enclosure.

H.R. 1745--Jobs, Opportunity, Benefits, and Services Act of 2011

    Summary: H.R. 1745 would, beginning in July 2011, repeal 
provisions that allow federal reimbursements for the emergency 
unemployment compensation program (EUC), temporarily provide 
full federal funding for extended benefits (EB), and allow 
states to make it easier to provide EB.
    Additionally, enacting the bill would provide special 
distributions to the states in 2011 and 2012 totaling $31 
billion, which states could use to continue to provide EUC and 
EB (as those programs existed on May 1, 2011), or pay for other 
unemployment-related expenses, including any interest due on 
loans from the unemployment trust fund (UTF).
    Finally, H.R. 1745 would require states to reduce 
unemployment benefits to individuals who have received 
overpayments, require individuals to meet certain criteria for 
receipt of benefits, and direct the Department of Labor to 
establish uniform reporting codes.
    CBO estimates that enacting H.R. 1745 would reduce outlays 
by $125 million in 2011 and by $3.1 billion over the 2011-2021 
period. Under the bill, revenues also would decline by $3.1 
billion over the 2011-2021 period. On balance, enacting H.R. 
1745 would increase deficits by $4 million over the 2011-2021 
period. Implementing the bill would not have a significant 
effect on discretionary spending.
    Pay-as-you-go procedures apply because enacting the 
legislation would affect direct spending and revenues.
    H.R. 1745 would impose no intergovernmental or private-
sector mandates as defined in the Unfunded Mandates Reform Act 
(UMRA).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 1745 is shown in the following table. 
The costs of this legislation fall within budget function 600 
(income security).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        By fiscal year, in millions of dollars--
                               -------------------------------------------------------------------------------------------------------------------------
                                  2011     2012      2013     2014     2015     2016     2017     2018     2019     2020     2021   2011-2016  2011-2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               CHANGES IN DIRECT SPENDING

Estimated Budget Authority....     -125    -2,835      -15      -15      -15      -15      -15      -15      -15      -15      -15     -3,020     -3,095
Estimated Outlays.............     -125    -2,835      -15      -15      -15      -15      -15      -15      -15      -15      -15     -3,020     -3,095

                                                                   CHANGES IN REVENUES

Estimated Revenues............        0       -47     -352     -798     -772     -568     -291     -208      -41      -11      -11     -2,537     -3,099

                                NET INCREASE OR DECREASE (-) IN THE DEFICIT FROM CHANGES IN DIRECT SPENDING AND REVENUES

Estimated Impact on the            -125    -2,788      337      783      757      553      276      193       26       -4       -4       -483          4
 Deficit......................
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Basis of estimate: For the purpose of this estimate, CBO 
assumes H.R. 1745 will be enacted by July 1, 2011. Later 
enactment could change the estimate significantly.
    H.R. 1745 would repeal the federal funding for EUC for 
weeks of unemployment ending after July 6, 2011. In addition, 
H.R. 1745 would terminate temporary aspects of the EB program 
that extend 100 percent federal funding for that program and 
make it easier for states to meet the unemployment rate 
thresholds required to provide benefits.

Direct Spending

    The bill would transfer $12.8 billion to states for fiscal 
year 2011 and $18.2 billion for fiscal year 2012. States could 
use those funds to operate EUC and EB as they existed in state 
agreements as of May 1, 2011. However, the total amount that 
would be transferred is about $0.6 billion lower than the 
amounts CBO projects states will spend on EUC and special EB 
under current law. (Under current law, EUC and the temporary EB 
provisions are authorized through December 2011; states may 
terminate agreements to provide EUC by giving 30 days' notice 
to the Department of Labor.) A state could use the transferred 
funds for other unemployment-related purposes, including paying 
interest due on loans from the UTF, but such changes would 
require state legislation.
    CBO estimates that most states would continue to operate 
EUC and EB programs using their share of the total $31 billion 
in transfers that would be provided by H.R. 1745. However, CBO 
expects that some states would opt out of EUC, provide fewer 
benefits under EB, or change their laws to use a portion of the 
funds for other purposes. CBO estimates that such changes would 
decrease outlays for EUC and EB by $125 million in 2011 and 
$2.8 billion in 2012.
    The bill also would direct states to offset overpayments of 
unemployment compensation by reducing benefits to individuals, 
harmonize job search requirements, and mandate recipients of 
unemployment compensation to meet a minimum education threshold 
(though that requirement could be waived in cases of hardship). 
CBO estimates those provisions would reduce outlays by about 
$15 million per year beginning in 2013.

Revenues

    Provisions in H.R. 1745 would affect states' revenues for 
unemployment compensation, which are reflected on the federal 
budget. Lower outlays would result in higher balances in 
states' unemployment trust funds. In addition, beginning in 
July 2011, states would be able to receive a 50 percent match 
on expenses for EB, even if the states choose to fund their EB 
expenses with their share of the transferred funds. That 
provision also would result in higher balances in states' trust 
funds than under current law. CBO estimates that some states 
would respond to the higher balances by reducing their 
unemployment taxes (or by avoiding tax increases assumed in the 
baseline that would replenish the trust funds). As a result, 
CBO estimates that, on net, revenues would decline by $3.1 
billion over the 2011-2021 period under H.R. 1745.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays and revenues that are 
subject to those pay-as-you-go procedures are shown in the 
following table. Under H.R. 1745, there would be no net impact 
for purposes of enforcing the Statutory Pay-As-You-Go Act 
because the bill would designate the bill's effects as an 
emergency requirement.

    CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 1745 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON MAY 11, 2011, WITH SUBSEQUENT
                                                            LANGUAGE PROVIDED ON MAY 18, 2011
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                        By fiscal year, in millions of dollars--
                               -------------------------------------------------------------------------------------------------------------------------
                                  2011     2012      2013     2014     2015     2016     2017     2018     2019     2020     2021   2011-2016  2011-2021
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       NET INCREASE OR DECREASE (-) IN THE DEFICIT

Total change..................     -125    -2,788      337      783      757      553      276      193       26       -4       -4       -483          4
Less:
    Designated as Emergency         125     2,788     -337     -783     -757     -553     -276     -193      -26        4        4        483         -4
     Requirementsa............
Statutory Pay-As-You Go Impact        0         0        0        0        0        0        0        0        0        0        0          0          0
Memorandum:
    Change in Outlays.........     -125    -2,835      -15      -15      -15      -15      -15      -15      -15      -15      -15     -3,020     -3,095
    Change in Revenues........        0       -47     -352     -798     -772     -568     -291     -208      -41      -11      -11     -2,537    -3,099
--------------------------------------------------------------------------------------------------------------------------------------------------------
aSection 204 of H.R. 1745 would designate the budgetary effects of the bill as an emergency requirement pursuant to section 4(g) of the Statutory Pay-As-
  You-Go Act of 2010.

    Intergovernmental and private-sector impact: H.R. 1745 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. CBO estimates that changes to the unemployment 
compensation program would result in lower federal transfers to 
the states than under current law and also would result in 
decreases in unemployment taxes in some states. These effects, 
however, would result from states' participation in the federal 
unemployment insurance program, which is voluntary, and would 
not result from intergovernmental mandates as defined in UMRA.
    Estimate prepared by: Federal Spending: Christina Hawley 
Anthony; Federal Revenues: Barbara Edwards; Impact on State, 
Local, and Tribal Governments: Lisa Ramirez-Branum; Impact on 
the Private Sector: Sarah Axeen.
    Estimate approved by: Peter H. Fontaine, Assistant Director 
for Budget Analysis; Frank Sammartino, Assistant Director for 
Tax Analysis.

   V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE OF 
                            REPRESENTATIVES


          A. Committee Oversight Findings and Recommendations

    With respect to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives (relating to oversight findings), 
the Committee concluded that it was appropriate and timely to 
enact the sections included in the bill, as reported.

        B. Statement of General Performance Goals and Objectives

    With respect to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
bill contains no measure that authorizes new or additional 
funding compared with the current law baseline, so no statement 
of general performance goals and objectives for which any 
measure authorizes funding is required.

              C. Information Relating to Unfunded Mandates

    This information is provided in accordance with section 423 
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
    The Committee has determined that the revenue provisions of 
the bill do not impose a Federal mandate on the private sector. 
The Committee has determined that the revenue provisions of the 
bill do not impose a Federal intergovernmental mandate on 
State, local, or tribal governments.

                D. Applicability of House Rule XXI 5(b)

    Clause 5(b) of rule XXI of the Rules of the House of 
Representatives provides, in part, that ``A bill or joint 
resolution, amendment, or conference report carrying a Federal 
income tax rate increase may not be considered as passed or 
agreed to unless so determined by a vote of not less than 
three-fifths of the Members voting, a quorum being present.'' 
The Committee has carefully reviewed the sections of the bill, 
and states that the bill does not involve any Federal income 
tax rate increases within the meaning of the rule.

  E. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
                                Benefits

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee has carefully reviewed 
the provision of the bill, and states that the provisions of 
the bill do not contain any congressional earmarks, limited tax 
benefits, or limited tariff benefits within the meaning of the 
rule.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

SOCIAL SECURITY ACT

           *       *       *       *       *       *       *


       TITLE III--GRANTS TO STATES FOR UNEMPLOYMENT COMPENSATION 
ADMINISTRATION

           *       *       *       *       *       *       *


                        PROVISIONS OF STATE LAWS

  Sec. 303. (a) The Secretary of Labor shall make no 
certification for payment to any State unless he finds that the 
law of such State, approved by the Secretary of Labor under the 
Federal Unemployment Tax Act, includes provision for--
          (1) * * *

           *       *       *       *       *       *       *

          [(10) A requirement that, as a condition of 
        eligibility for regular compensation for any week, any 
        claimant who has been referred to reemployment services 
        pursuant to the profiling system under subsection 
        (j)(1)(B) participate in such services or in similar 
        services unless the State agency charged with the 
        administration of the State law determines--
                  [(A) such claimant has completed such 
                services; or
                  [(B) there is justifiable cause for such 
                claimant's failure to participate in such 
                services.]
          (10)(A) A requirement that, as a condition of 
        eligibility for regular compensation for any week--
                  (i) a claimant shall meet the minimum 
                educational requirements set forth in 
                subparagraph (B); and
                  (ii) any claimant who has been referred to 
                reemployment services shall participate in such 
                services.
          (B) For purposes of this paragraph, an individual 
        shall not be considered to have met the minimum 
        educational requirements of this subparagraph unless 
        such individual--
                  (i) has earned a high school diploma;
                  (ii) has earned the General Educational 
                Development (GED) credential or other State-
                recognized equivalent (including by meeting 
                recognized alternative standards for 
                individuals with disabilities); or
                  (iii) is enrolled and making satisfactory 
                progress in classes leading to satisfaction of 
                clause (ii).
          (C) The requirements of subparagraph (B) may be 
        waived for an individual to the extent that the State 
        agency charged with the administration of the State law 
        deems such requirements to be unduly burdensome in the 
        case of such individual.
          (11)(A) A requirement that, as a condition of 
        eligibility for regular compensation for any week, a 
        claimant must be able to work, available to work, and 
        actively seeking work.
          (B) For purposes of this paragraph, the term 
        ``actively seeking work'' means, with respect to any 
        individual, that such individual is actively engaged in 
        a systematic and sustained effort to obtain work, as 
        determined based on evidence (whether in electronic 
        format or otherwise) satisfactory to the State agency 
        charged with the administration of the State law.
          (C) The specific requirements that must be met in 
        order to satisfy this paragraph shall be established by 
        the State agency, and shall include at least the 
        following:
                  (i) Registration for employment services 
                within 14 days after making initial application 
                for regular compensation.
                  (ii) Posting a resume, record, or other 
                application for employment on such database as 
                the State agency may require.
                  (iii) Applying, in such manner as the State 
                agency may require, for work which is similar 
                to that previously performed by the individual, 
                and which offers wages comparable to wages for 
                similar work in the local labor market in which 
                the individual resides or is actively seeking 
                work.

           *       *       *       *       *       *       *

  (g)(1) A State [may] shall deduct from unemployment benefits 
otherwise payable to an individual an amount equal to any 
overpayment made to such individual under an unemployment 
benefit program of the United States or of any other State, and 
not previously recovered. The amount so deducted shall be paid 
to the jurisdiction under whose program such overpayment was 
made. Any such deduction shall be made only in accordance with 
the same procedures relating to notice and opportunity for a 
hearing as apply to the recovery of overpayments of regular 
unemployment compensation paid by such State.

           *       *       *       *       *       *       *


                         DEMONSTRATION PROJECTS

  Sec. 305. (a) The Secretary of Labor may enter into 
agreements, with States submitting an application described in 
subsection (b), for the purpose of allowing such States to 
conduct demonstration projects to test and evaluate measures 
designed--
          (1) to expedite the reemployment of individuals who 
        establish initial eligibility for unemployment 
        compensation under the State law of such State; or
          (2) to improve the effectiveness of a State in 
        carrying out its State law with respect to 
        reemployment.
  (b) The Governor of any State desiring to conduct a 
demonstration project under this section shall submit an 
application to the Secretary of Labor. Any such application 
shall, at a minimum, include--
          (1) a general description of the proposed 
        demonstration project, including the authority (under 
        the laws of the State) for the measures to be tested, 
        as well as the period of time during which such 
        demonstration project would be conducted;
          (2) if a waiver under subsection (c) is requested, 
        the specific aspects of the project to which the waiver 
        would apply and the reasons why such waiver is needed;
          (3) a description of the goals and the expected 
        programmatic outcomes of the demonstration project, 
        including how the project would contribute to the 
        objective described in subsection (a)(1), subsection 
        (a)(2), or both;
          (4) assurances (accompanied by supporting analysis) 
        that the demonstration project would not result in any 
        increased net costs to the State's account in the 
        Unemployment Trust Fund;
          (5) a description of the manner in which the State--
                  (A) will conduct an impact evaluation, using 
                a control or comparison group or other valid 
                methodology, of the demonstration project; and
                  (B) will determine the extent to which the 
                goals and outcomes described in paragraph (3) 
                were achieved; and
          (6) assurances that the State will provide any 
        reports relating to the demonstration project, after 
        its approval, as the Secretary of Labor may require.
  (c) The Secretary of Labor may waive any of the requirements 
of section 3304(a)(4) of the Internal Revenue Code of 1986 or 
of paragraph (1) or (5) of section 303(a), to the extent and 
for the period the Secretary of Labor considers necessary to 
enable the State to carry out a demonstration project under 
this section.
  (d) A demonstration project under this section--
          (1) may be commenced any time after the date of 
        enactment of this section; and
          (2) may not be approved for a period of time greater 
        than 3 years, subject to extension upon request of the 
        Governor of the State involved for such additional 
        period as the Secretary of Labor may agree to, except 
        that in no event may a demonstration project under this 
        section be conducted after the end of the 5-year period 
        beginning on the date of enactment of this section.
  (e) The Secretary of Labor shall, in the case of any State 
for which an application is submitted under subsection (b)--
          (1) notify the State as to whether such application 
        has been approved or denied within 30 days after 
        receipt of a complete application; and
          (2) provide public notice of the decision within 10 
        days after providing notification to the State in 
        accordance with paragraph (1).
Public notice under paragraph (2) may be provided through the 
Internet or other appropriate means. Any application under this 
section that has not been denied within such 30 days shall be 
deemed approved, and public notice of any approval under this 
sentence shall be provided within 10 days thereafter.
  (f) The Secretary of Labor may terminate a demonstration 
project under this section if the Secretary makes a final 
determination that the State has violated the substantive terms 
or conditions of the project.

           *       *       *       *       *       *       *


TITLE IX--MISCELLANEOUS PROVISIONS RELATING TO EMPLOYMENT SECURITY

           *       *       *       *       *       *       *


                 AMOUNTS TRANSFERRED TO STATE ACCOUNTS



  Sec. 903. (a) * * *

           *       *       *       *       *       *       *


            Special Transfers in Fiscal Years 2011 and 2012

  (h)(1) The Secretary of the Treasury shall transfer (as of 
the dates determined under paragraph (4)) from the extended 
unemployment compensation account to the account of each State 
in the Unemployment Trust Fund the amount determined with 
respect to such State under paragraph (2).
  (2)(A) The amount to be transferred to a State under this 
subsection in any fiscal year is the amount derived by 
multiplying the applicable total dollar amount for such fiscal 
year by the applicable fraction for such State.
  (B) For purposes of subparagraph (A), the applicable total 
dollar amount is--
          (i) for fiscal year 2011, $12,800,000,000; and
          (ii) for fiscal year 2012, $18,200,000,000.
  (C) For purposes of subparagraph (A), the applicable fraction 
for a State is a fraction--
          (i) the numerator of which is the total amount of 
        extended compensation and emergency unemployment 
        compensation paid out by such State for weeks beginning 
        in the 12-month period described in clause (ii); and
          (ii) the denominator of which is the total amount of 
        extended compensation and emergency unemployment 
        compensation paid out by all States for weeks beginning 
        in the most recent 12-month period for which that 
        information is available for all States as of May 1, 
        2011.
  (3)(A) Except as provided in subparagraph (B), amounts 
transferred to a State account pursuant to this subsection 
shall be used only in the payment of extended compensation and 
emergency unemployment compensation, in accordance with 
applicable provisions of Federal and State law (including 
agreements and implementing regulations) as in effect on May 1, 
2011.
  (B) A State may, pursuant to specific legislation enacted by 
the legislative body of the State after the date of enactment 
of the JOBS Act of 2011, use money transferred to the State 
account of such State under this subsection for (i) the payment 
of unemployment compensation, (ii) the repayment of advances 
made to such State under section 1201 (including interest 
thereon), and (iii) reemployment services designed to enhance 
the rapid reemployment of unemployed workers (such as mandatory 
workshops, claimant assessments, resume preparation and job 
search assistance, wage subsidy programs, eligibility reviews, 
labor market information, development of a work-search plan, 
and training), if and only if--
          (I) the purposes and amounts are specified in the 
        law;
          (II) the money is withdrawn and expended, for the 
        purpose described in clause (i), (ii), or (iii) (as the 
        case may be), after the date of enactment of the law; 
        and
          (III) the use of the money is accounted for in 
        accordance with standards established by the Secretary 
        of Labor.
  (4) Transfers under this subsection shall--
          (A) to the extent that they relate to the amount set 
        forth in paragraph (2)(B)(i), be made within 10 days 
        after the date of enactment of this subsection; and
          (B) to the extent that they relate to the amount set 
        forth in paragraph (2)(B)(ii), be made after September 
        30, 2011, and on or before October 10, 2011.

           *       *       *       *       *       *       *


            DATA STANDARDIZATION FOR IMPROVED DATA MATCHING

                         Standard Data Elements

  Sec. 911. (a)(1) The Secretary of Labor, in consultation with 
an interagency work group established by the Office of 
Management and Budget, and considering State perspectives, 
shall, by rule, designate standard data elements for any 
category of information required under title III or this title.
  (2) The standard data elements designated under paragraph (1) 
shall, to the extent practicable, be nonproprietary and 
interoperable.
  (3) In designating standard data elements under this 
subsection, the Secretary of Labor shall, to the extent 
practicable, incorporate--
          (A) interoperable standards developed and maintained 
        by an international voluntary consensus standards body, 
        as defined by the Office of Management and Budget, such 
        as the International Organization for Standardization;
          (B) interoperable standards developed and maintained 
        by intergovernmental partnerships, such as the National 
        Information Exchange Model; and
          (C) interoperable standards developed and maintained 
        by Federal entities with authority over contracting and 
        financial assistance, such as the Federal Acquisition 
        Regulations Council.

                      Data Standards for Reporting

  (b)(1) The Secretary of Labor, in consultation with an 
interagency work group established by the Office of Management 
and Budget, and considering State government perspectives, 
shall, by rule, designate data reporting standards to govern 
the reporting required under title III or this title.
  (2) The data reporting standards required by paragraph (1) 
shall, to the extent practicable--
          (A) incorporate a widely-accepted, non-proprietary, 
        searchable, computer-readable format;
          (B) be consistent with and implement applicable 
        accounting principles; and
          (C) be capable of being continually upgraded as 
        necessary.
  (3) In designating reporting standards under this subsection, 
the Secretary of Labor shall, to the extent practicable, 
incorporate existing nonproprietary standards, such as the 
eXtensible Business Reporting Language.

           *       *       *       *       *       *       *


TITLE XII--ADVANCES TO STATE UNEMPLOYMENT FUNDS

           *       *       *       *       *       *       *


      REPAYMENT BY STATES OF ADVANCES TO STATE UNEMPLOYMENT FUNDS

  Sec. 1202. (a) * * *
  (b)(1) * * *
  (2) No interest shall be required to be paid under paragraph 
(1) with respect to any advance or advances made during any 
calendar year if--
          (A) such advances are repaid in full before the close 
        of September 30 of the calendar year in which the 
        advances revere made, and
          (B) no other advance was made to such State under 
        section 1201 during such calendar year and after the 
        date on which the repayment of the advances was 
        completed[, and].
          [(C) such State meets funding goals, established 
        under regulations issued by the Secretary of Labor, 
        relating to the accounts of the States in the 
        Unemployment Trust Fund.]

           *       *       *       *       *       *       *

                              ----------                              


INTERNAL REVENUE CODE OF 1986

           *       *       *       *       *       *       *


Subtitle C--Employment Taxes

           *       *       *       *       *       *       *


CHAPTER 23--FEDERAL UNEMPLOYMENT TAX ACT

           *       *       *       *       *       *       *


SEC. 3304. APPROVAL OF STATE LAWS.

  (a) Requirements.--The Secretary of Labor shall approve any 
State law submitted to him, within 30 days of such submission, 
which he finds provides that--
          (1) * * *

           *       *       *       *       *       *       *

          (4) all money withdrawn from the unemployment fund of 
        the State shall be used solely in the payment of 
        unemployment compensation, exclusive of expenses of 
        administration, and for refunds of sums erroneously 
        paid into such fund and refunds paid in accordance with 
        the provisions of section 3305(b); except that--
                  (A) * * *

           *       *       *       *       *       *       *

                  (D) amounts [may] shall be deducted from 
                unemployment benefits and used to repay 
                overpayments as provided in section 303(g) of 
                the Social Security Act;

           *       *       *       *       *       *       *

          [(8) compensation shall not be denied to an 
        individual for any week because he is in training with 
        the approval of the State agency (or because of the 
        application, to any such week in training, of State law 
        provisions relating to availability for work, active 
        search for work, or refusal to accept work);]
          (8) compensation shall not be denied to an individual 
        for any week in which the individual is enrolled and 
        making satisfactory progress in education or training 
        which has been previously approved by the State agency;

           *       *       *       *       *       *       *

                              ----------                              


SUPPLEMENTAL APPROPRIATIONS ACT, 2008

           *       *       *       *       *       *       *


             TITLE IV--EMERGENCY UNEMPLOYMENT COMPENSATION

                        FEDERAL-STATE AGREEMENTS

  Sec. 4001. (a) * * *

           *       *       *       *       *       *       *

  [(g) Nonreduction Rule.--An agreement under this section 
shall not apply (or shall cease to apply) with respect to a 
State upon a determination by the Secretary that the method 
governing the computation of regular compensation under the 
State law of that State has been modified in a manner such 
that--
          [(1) the average weekly benefit amount of regular 
        compensation which will be payable during the period of 
        the agreement occurring on or after June 2, 2010 
        (determined disregarding any additional amounts 
        attributable to the modification described in section 
        2002(b)(1) of the Assistance for Unemployed Workers and 
        Struggling Families Act, as contained in Public Law 
        111-5 (26 U.S.C. 3304 note; 123 Stat. 438)), will be 
        less than
          [(2) the average weekly benefit amount of regular 
        compensation which would otherwise have been payable 
        during such period under the State law, as in effect on 
        June 2, 2010.]

           *       *       *       *       *       *       *


  [PAYMENTS TO STATES HAVING AGREEMENTS FOR THE PAYMENT OF EMERGENCY 
                       UNEMPLOYMENT COMPENSATION

  [Sec. 4003. (a) General Rule.--There shall be paid to each 
State that has entered into an agreement under this title an 
amount equal to 100 percent of the emergency unemployment 
compensation paid to individuals by the State pursuant to such 
agreement.
  [(b) Treatment of Reimbursable Compensation.--No payment 
shall be made to any State under this section in respect of any 
compensation to the extent the State is entitled to 
reimbursement in respect of such compensation under the 
provisions of any Federal law other than this title or chapter 
85 of title 5, United States Code. A State shall not be 
entitled to any reimbursement under such chapter 85 in respect 
of any compensation to the extent the State is entitled to 
reimbursement under this title in respect of such compensation.
  [(c) Determination of Amount.--Sums payable to any State by 
reason of such State having an agreement under this title shall 
be payable, either in advance or by way of reimbursement (as 
may be determined by the Secretary), in such amounts as the 
Secretary estimates the State will be entitled to receive under 
this title for each calendar month, reduced or increased, as 
the case may be, by any amount by which the Secretary finds 
that the Secretary's estimates for any prior calendar month 
were greater or less than the amounts which should have been 
paid to the State. Such estimates may be made on the basis of 
such statistical, sampling, or other method as may be agreed 
upon by the Secretary and the State agency of the State 
involved.]

                          FINANCING PROVISIONS

  Sec. 4004. (a) * * *

           *       *       *       *       *       *       *

  (e) Transfer of Funds.--Notwithstanding any other provision 
of law, the Secretary of the Treasury shall transfer from the 
general fund of the Treasury (from funds not otherwise 
appropriated)--
          (1) to the extended unemployment compensation account 
        (as established by section 905 of the Social Security 
        Act) such sums as the Secretary of Labor estimates to 
        be necessary to make payments to States under this 
        title by reason of--
                  (A) * * *

           *       *       *       *       *       *       *

                  (F) the amendments made by section 2(a)(1) of 
                the Unemployment Compensation Extension Act of 
                2010; [and]

           *       *       *       *       *       *       *

                  (H) the amendment made by section 201 of the 
                Jobs, Opportunity, Benefits, and Services Act 
                of 2011; and

           *       *       *       *       *       *       *

                              ----------                              


ASSISTANCE FOR UNEMPLOYED WORKERS AND STRUGGLING FAMILIES ACT

           *       *       *       *       *       *       *


TITLE II--ASSISTANCE FOR UNEMPLOYED WORKERS AND STRUGGLING FAMILIES

           *       *       *       *       *       *       *


Subtitle A--Unemployment Insurance

           *       *       *       *       *       *       *


SEC. 2005. FULL FEDERAL FUNDING OF EXTENDED UNEMPLOYMENT COMPENSATION 
                    FOR A LIMITED PERIOD.

  (a) In General.--In the case of sharable extended 
compensation and sharable regular compensation paid for weeks 
of unemployment beginning after the date of the enactment of 
this section and before [January 4, 2012] July 6, 2011, section 
204(a)(1) of the Federal-State Extended Unemployment 
Compensation Act of 1970 (26 U.S.C. 3304 note) shall be applied 
by substituting ``100 percent of'' for ``one-half of''.
  (b) Special Rule.--At the option of a State, for any weeks of 
unemployment beginning after the date of the enactment of this 
section and before [January 4, 2012] the date of enactment of 
the JOBS Act of 2011, an individual's eligibility period (as 
described in section 203(c) of the Federal-State Extended 
Unemployment Compensation Act of 1970) shall, for purposes of 
any determination of eligibility for extended compensation 
under the State law of such State, be considered to include any 
week which begins--
          (1) * * *

           *       *       *       *       *       *       *

  [(c) Limited Extension.--In the case of an individual who 
receives extended compensation with respect to 1 or more weeks 
of unemployment beginning after the date of the enactment of 
this Act and before January 4, 2012, the provisions of 
subsections (a) and (b) shall, at the option of a State, be 
applied by substituting ``ending before June 11, 2012'' for 
``before January 4, 2012''.]

           *       *       *       *       *       *       *

                              ----------                              


FEDERAL-STATE EXTENDED UNEMPLOYMENT COMPENSATION ACT OF 1970

           *       *       *       *       *       *       *


                        EXTENDED BENEFIT PERIOD

                          Beginning and Ending

  Sec. 203. (a) * * *

           *       *       *       *       *       *       *


                     State On and Off Indicators.--

  (d) For purposes of this section--
          (1) * * *

           *       *       *       *       *       *       *

Effective with respect to compensation for weeks of 
unemployment beginning after March 30, 1977 (or, if later, the 
date established pursuant to State law), the State may by law 
provide that the determination of whether there has been a 
State ``on'' or ``off'' indicator beginning or ending any 
extended benefit period shall be made under this subsection as 
if (i) paragraph (1) did not contain subparagraph (A) thereof, 
and (ii) the figure ``5'' contained in subparagraph (B) thereof 
were ``6''; except that, notwithstanding any such provision of 
State law, any week for which there would otherwise be a State 
``on'' indicator shall continue to be such a week and shall not 
be determined to be a week for which there is a State ``off'' 
indicator. Effective with respect to compensation for weeks of 
unemployment beginning after the date of enactment of the Tax 
Relief, Unemployment Insurance Reauthorization, and Job 
Creation Act of 2010 (or, if later, the date established 
pursuant to State law), and ending on or before [December 31, 
2011] June 30, 2011, the State may by law provide that the 
determination of whether there has been a state ``on'' or 
``off'' indicator beginning or ending any extended benefit 
period shall be made under this subsection as if the word 
``two'' were ``three'' in subparagraph (1)(A). For purposes of 
this subsection, the rate of insured unemployment for any 
thirteen-week period shall be determined by reference to the 
average monthly covered employment under the State law for the 
first four of the most recent six calendar quarters ending 
before the close of such period.

           *       *       *       *       *       *       *


                          Alternative Trigger

  (f)(1) * * *
  (2) Effective with respect to compensation for weeks of 
unemployment beginning after the date of enactment of the Tax 
Relief, Unemployment Insurance Reauthorization, and Job 
Creation Act of 2010 (or, if later, the date established 
pursuant to State law), and ending on or before [December 31, 
2011] June 30, 2011, the State may by law provide that the 
determination of whether there has been a state ``on'' or 
``off'' indicator beginning or ending any extended benefit 
period shall be made under this subsection as if the word 
``either'' were ``any'', the word ``both'' were ``all'', and 
the figure ``2'' were ``3'' in clause (1)(A)(ii).

           *       *       *       *       *       *       *


                            DISSENTING VIEWS

    We oppose H.R. 1745 because the legislation ends the 
current Federal guarantee of extended unemployment benefits for 
America's long-term unemployed. Jeopardizing the unemployment 
benefits of over four million Americans is the wrong path for 
our Nation, and it reneges on legislation Republicans agreed to 
less than six months ago to extend unemployment benefits in 
exchange for continuing tax cuts for the wealthy.
    Under the policies adopted by Democrats in Congress and 
President Obama, our economy has created over two million new 
private sector jobs over the last 14 months. By comparison, 
during the last 14 months of President Bush's Administration, 
the Nation lost over 3.7 million private sector jobs. But even 
with this improvement, the job market remains tough for many 
Americans. There are still roughly 7 million fewer jobs in the 
economy today than when the ``Great Recession'' started in 
December 2007. Data from the Department of Labor shows there 
are about four and half unemployed individuals for every 
available job. Additionally, the long-term unemployment rate 
for the first four months of this year is at an historically 
high level, with over 44 percent of the jobless without work 
for at least six months.
    During the markup of H.R. 1745, Members of the majority 
suggested the legislation does not encourage States to 
terminate unemployment benefits for Americans struggling to 
find work. However, the bill clearly allows States to divert up 
to $31 billion of Federal funds for extended unemployment 
benefits toward other purposes. As Labor Secretary Hilda Solis 
says in her letter opposing the legislation, ``H.R. 1745 could 
end these crucial benefits by providing incentives for states 
to eliminate these benefit programs altogether.''
    The majority also suggested that the risk of unemployment 
funds being diverted is moderated by the fact some States have 
already ended their legislative sessions. Of course, these 
States could come back into special session to change their 
laws. Furthermore, a Governor could unilaterally end a State's 
participation in the Emergency Unemployment Compensation (EUC) 
program (without approval from the legislature) and wait for 
the next legislative session to reach agreement on how to spend 
the funds that have been diverted from paying extended 
unemployment benefits.
    The legislation makes it clear that one of the purposes 
that States can divert Federal UI funds toward is paying all or 
a portion of any outstanding loan the State has received from 
the Federal Unemployment Trust Funds. We note that many 
proposals have been put forward to address solvency issues 
within the unemployment system, and we would have preferred a 
genuine effort to find bipartisan consensus on the issue. In 
this context, it is worth remembering that the Government 
Accountability Office (GAO) informed the Committee last year 
that State UI financing policies are a major factor behind 
their current insolvency problems. More specifically, GAO 
found, ``Long-standing UI tax policies and practices in many 
States over 3 decades have eroded trust fund reserves, leaving 
States in a weak position prior to the recent recession.'' The 
report highlighted that ``While [unemployment] benefits over 
the last 3 decades have remained largely flat relative to 
wages, employer tax rates have declined.'' In terms of 
restoring the solvency of the Federal Unemployment Trust Funds, 
H.R. 1745 fails to continue an expiring source of funding that 
has been in place for over 30 years and that has been routinely 
extended with bipartisan support.
    We also believe it is important to recognize that 
unemployment benefits are not generous, with the average weekly 
benefit of $300 reaching only 70 percent of the poverty line 
for a family of four. Nevertheless, unemployment insurance 
remains the difference between hardship and destitution for 
millions of workers who have lost their jobs through no fault 
of their own. Over four million jobless workers now depend on 
Federal unemployment insurance and the legislation ends the 
assurance that their benefits will continue. Furthermore, the 
bill repeals a protection that prevents States from cutting the 
cash amount of regular unemployment benefits when participating 
in the EUC program. We also are concerned about proposals that 
tie eligibility to education and training at a time when the 
majority's budget proposals slash funding for education, job 
training and employment services.
    Finally, while the majority calls H.R. 1745 a jobs bill, 
the legislation has nothing to do with creating jobs. In fact, 
by diverting money from unemployment benefits to purposes with 
less economic impact, the legislation could cost American jobs. 
An analysis by the Economic Policy Institute points out that if 
every State used the unemployment funds for debt repayment or 
trust fund solvency instead of continuing extended benefits, 
322,000 jobs could be lost due to the decline in economic 
activity associated with the expenditure of UI benefits. Of 
course, if only some States pursued that course, the negative 
impact would be smaller, but there could still be a harmful 
effect on job growth.
    We therefore oppose H.R. 1745 as a bill that could 
negatively impact job creation, hurt unemployed Americans, and 
take the wrong step in addressing long-term solvency for the 
Unemployment Insurance system. The Republican majority should 
refrain from blaming the unemployed for unemployment and join 
with us in working to continue to create jobs.
                                   Sander Levin.
                                   John Lewis.
                                   Shelley Berkley.
                                   Bill Pascrell, Jr.
                                   John B. Larson.
                                   Jim McDermott.
                                   Earl Blumenauer.
                                   Lloyd Doggett.
                                   Pete Stark.
                                   Joe Crowley.
                                   Charles B. Rangel.
                                   Ron Kind.
                                   Mike Thompson.
                                   Xavier Becerra.