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112th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 112-399
_______________________________________________________________________
MIDDLE CLASS TAX RELIEF AND JOB CREATION ACT OF 2012
----------
CONFERENCE REPORT
to accompany
H.R. 3630
February 16, 2012.--Ordered to be printed
MIDDLE CLASS TAX RELIEF AND JOB CREATION ACT OF 2012
112th Congress
2d Session HOUSE OF REPRESENTATIVES Report
112-399
_______________________________________________________________________
MIDDLE CLASS TAX RELIEF AND JOB CREATION ACT OF 2012
__________
CONFERENCE REPORT
to accompany
H.R. 3630
February 16, 2012.--Ordered to be printed
112th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 112-399
======================================================================
MIDDLE CLASS TAX RELIEF AND JOB CREATION ACT OF 2012
_______
February 16, 2012.--Ordered to be printed
_______
Mr. Camp, from the committee of conference, submitted the following
CONFERENCE REPORT
[To accompany H.R. 3630]
The committee of conference on the disagreeing votes of
the two Houses on the amendments of the Senate to the bill
(H.R. 3630), to provide incentives for the creation of jobs,
and for other purposes, having met, after full and free
conference, have agreed to recommend and do recommend to their
respective Houses as follows:
That the House recede from its disagreement to the
amendment of the Senate to the text of the bill and agree to
the same with an amendment as follows:
In lieu of the matter proposed to be inserted by the
Senate amendment, insert the following:
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Middle
Class Tax Relief and Job Creation Act of 2012''.
(b) Table of Contents.--The table of contents for this Act
is as follows:
Sec. 1. Short title; table of contents.
TITLE I--EXTENSION OF PAYROLL TAX REDUCTION
Sec. 1001. Extension of payroll tax reduction.
TITLE II--UNEMPLOYMENT BENEFIT CONTINUATION AND PROGRAM IMPROVEMENT
Sec. 2001. Short title.
Subtitle A--Reforms of Unemployment Compensation to Promote Work and Job
Creation
Sec. 2101. Consistent job search requirements.
Sec. 2102. State flexibility to promote the reemployment of unemployed
workers.
Sec. 2103. Improving program integrity by better recovery of
overpayments.
Sec. 2104. Data exchange standardization for improved interoperability.
Sec. 2105. Drug testing of applicants.
Subtitle B--Provisions Relating To Extended Benefits
Sec. 2121. Short title.
Sec. 2122. Extension and modification of emergency unemployment
compensation program.
Sec. 2123. Temporary extension of extended benefit provisions.
Sec. 2124. Additional extended unemployment benefits under the Railroad
Unemployment Insurance Act.
Subtitle C--Improving Reemployment Strategies Under the Emergency
Unemployment Compensation Program
Sec. 2141. Improved work search for the long-term unemployed.
Sec. 2142. Reemployment services and reemployment and eligibility
assessment activities.
Sec. 2143. Promoting program integrity through better recovery of
overpayments.
Sec. 2144. Restore State flexibility to improve unemployment program
solvency.
Subtitle D--Short-Time Compensation Program
Sec. 2160. Short title.
Sec. 2161. Treatment of short-time compensation programs.
Sec. 2162. Temporary financing of short-time compensation payments in
States with programs in law.
Sec. 2163. Temporary financing of short-time compensation agreements.
Sec. 2164. Grants for short-time compensation programs.
Sec. 2165. Assistance and guidance in implementing programs.
Sec. 2166. Reports.
Subtitle E--Self-Employment Assistance
Sec. 2181. State administration of self-employment assistance programs.
Sec. 2182. Grants for self-employment assistance programs.
Sec. 2183. Assistance and guidance in implementing self-employment
assistance programs.
Sec. 2184. Definitions.
TITLE III--MEDICARE AND OTHER HEALTH PROVISIONS
Subtitle A--Medicare Extensions
Sec. 3001. Extension of MMA section 508 reclassifications.
Sec. 3002. Extension of outpatient hold harmless payments.
Sec. 3003. Physician payment update.
Sec. 3004. Work geographic adjustment.
Sec. 3005. Payment for outpatient therapy services.
Sec. 3006. Payment for technical component of certain physician
pathology services.
Sec. 3007. Ambulance add-on payments.
Subtitle B--Other Health Provisions
Sec. 3101. Qualifying individual program.
Sec. 3102. Transitional medical assistance.
Subtitle C--Health Offsets
Sec. 3201. Reduction of bad debt treated as an allowable cost.
Sec. 3202. Rebase Medicare clinical laboratory payment rates.
Sec. 3203. Rebasing State DSH allotments for fiscal year 2021.
Sec. 3204. Technical correction to the disaster recovery FMAP provision.
Sec. 3205. Prevention and Public Health Fund.
TITLE IV--TANF EXTENSION
Sec. 4001. Short title.
Sec. 4002. Extension of program.
Sec. 4003. Data exchange standardization for improved interoperability.
Sec. 4004. Spending policies for assistance under State TANF programs.
Sec. 4005. Technical corrections.
TITLE V--FEDERAL EMPLOYEES RETIREMENT
Sec. 5001. Increase in contributions to Federal Employees' Retirement
System for new employees.
Sec. 5002. Foreign Service Pension System.
Sec. 5003. Central Intelligence Agency Retirement and Disability System.
TITLE VI--PUBLIC SAFETY COMMUNICATIONS AND ELECTROMAGNETIC SPECTRUM
AUCTIONS
Sec. 6001. Definitions.
Sec. 6002. Rule of construction.
Sec. 6003. Enforcement.
Sec. 6004. National security restrictions on use of funds and auction
participation.
Subtitle A--Reallocation of Public Safety Spectrum
Sec. 6101. Reallocation of D block to public safety.
Sec. 6102. Flexible use of narrowband spectrum.
Sec. 6103. 470-512 MHz public safety spectrum.
Subtitle B--Governance of Public Safety Spectrum
Sec. 6201. Single public safety wireless network licensee.
Sec. 6202. Public safety broadband network.
Sec. 6203. Public Safety Interoperability Board.
Sec. 6204. Establishment of the First Responder Network Authority.
Sec. 6205. Advisory committees of the First Responder Network Authority.
Sec. 6206. Powers, duties, and responsibilities of the First Responder
Network Authority.
Sec. 6207. Initial funding for the First Responder Network Authority.
Sec. 6208. Permanent self-funding; duty to assess and collect fees for
network use.
Sec. 6209. Audit and report.
Sec. 6210. Annual report to Congress.
Sec. 6211. Public safety roaming and priority access.
Sec. 6212. Prohibition on direct offering of commercial
telecommunications service directly to consumers.
Sec. 6213. Provision of technical assistance.
Subtitle C--Public Safety Commitments
Sec. 6301. State and Local Implementation Fund.
Sec. 6302. State and local implementation.
Sec. 6303. Public safety wireless communications research and
development.
Subtitle D--Spectrum Auction Authority
Sec. 6401. Deadlines for auction of certain spectrum.
Sec. 6402. General authority for incentive auctions.
Sec. 6403. Special requirements for incentive auction of broadcast TV
spectrum.
Sec. 6404. Certain conditions on auction participation prohibited.
Sec. 6405. Extension of auction authority.
Sec. 6406. Unlicensed use in the 5 GHz band.
Sec. 6407. Guard bands and unlicensed use.
Sec. 6408. Study on receiver performance and spectrum efficiency.
Sec. 6409. Wireless facilities deployment.
Sec. 6410. Functional responsibility of NTIA to ensure efficient use of
spectrum.
Sec. 6411. System certification.
Sec. 6412. Deployment of 11 GHz, 18 GHz, and 23 GHz microwave bands.
Sec. 6413. Public Safety Trust Fund.
Sec. 6414. Study on emergency communications by amateur radio and
impediments to amateur radio communications.
Subtitle E--Next Generation 9-1-1 Advancement Act of 2012
Sec. 6501. Short title.
Sec. 6502. Definitions.
Sec. 6503. Coordination of 9-1-1 implementation.
Sec. 6504. Requirements for multi-line telephone systems.
Sec. 6505. GAO study of State and local use of 9-1-1 service charges.
Sec. 6506. Parity of protection for provision or use of Next Generation
9-1-1 services.
Sec. 6507. Commission proceeding on autodialing.
Sec. 6508. Report on costs for requirements and specifications of Next
Generation 9-1-1 services.
Sec. 6509. Commission recommendations for legal and statutory framework
for Next Generation 9-1-1 services.
Subtitle F--Telecommunications Development Fund
Sec. 6601. No additional Federal funds.
Sec. 6602. Independence of the Fund.
Subtitle G--Federal Spectrum Relocation
Sec. 6701. Relocation of and spectrum sharing by Federal Government
stations.
Sec. 6702. Spectrum Relocation Fund.
Sec. 6703. National security and other sensitive information.
TITLE VII--MISCELLANEOUS PROVISIONS
Sec. 7001. Repeal of certain shifts in the timing of corporate estimated
tax payments.
Sec. 7002. Repeal of requirement relating to time for remitting certain
merchandise processing fees.
Sec. 7003. Treatment for PAYGO purposes.
TITLE I--EXTENSION OF PAYROLL TAX REDUCTION
SEC. 1001. EXTENSION OF PAYROLL TAX REDUCTION.
(a) In General.--Subsection (c) of section 601 of the Tax
Relief, Unemployment Insurance Reauthorization, and Job
Creation Act of 2010 (26 U.S.C. 1401 note) is amended to read
as follows:
``(c) Payroll Tax Holiday Period.--The term `payroll tax
holiday period' means calendar years 2011 and 2012.''.
(b) Conforming Amendments.--Section 601 of such Act (26
U.S.C. 1401 note) is amended by striking subsections (f) and
(g).
(c) Effective Date.--The amendments made by this section
shall apply to remuneration received, and taxable years
beginning, after December 31, 2011.
TITLE II--UNEMPLOYMENT BENEFIT CONTINUATION AND PROGRAM IMPROVEMENT
SEC. 2001. SHORT TITLE.
This title may be cited as the ``Extended Benefits,
Reemployment, and Program Integrity Improvement Act''.
Subtitle A--Reforms of Unemployment Compensation to Promote Work and
Job Creation
SEC. 2101. CONSISTENT JOB SEARCH REQUIREMENTS.
(a) In General.--Section 303(a) of the Social Security Act
is amended by adding at the end the following:
``(12) 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) 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. 2102. 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 up to 10 States that submit 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 have established a benefit year and are otherwise
eligible to claim 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 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, a statement describing 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 operate
for a period of at least 1 calendar year and 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 methodology appropriate to determine
the effects of the demonstration project,
including on individual skill levels, earnings,
and employment retention; and
``(B) will determine the extent to which
the goals and outcomes described in paragraph
(3) were achieved;
``(6) assurances that the State will provide any
reports relating to the demonstration project, after
its approval, as the Secretary of Labor may require;
and
``(7) assurances that employment meets the State's
suitable work requirement and the requirements of
section 3304(a)(5) of the Internal Revenue Code of
1986.
``(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;
``(2) may not be approved for a period of time
greater than 3 years; and
``(3) must be completed by not later than December
31, 2015.
``(e) Activities that may be pursued under a demonstration
project under this section are limited to--
``(1) subsidies for employer-provided training,
such as wage subsidies; and
``(2) direct disbursements to employers who hire
individuals receiving unemployment compensation, not to
exceed the weekly benefit amount for each such
individual, to pay part of the cost of wages that
exceed the unemployed individual's prior benefit level.
``(f) 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 the 30-day period
described in paragraph (1) shall be deemed approved, and public
notice of any approval under this sentence shall be provided
within 10 days thereafter.
``(g) The Secretary of Labor may terminate a demonstration
project under this section if the Secretary determines that the
State has violated the substantive terms or conditions of the
project.
``(h) Funding certified under section 302(a) may be used
for an approved demonstration project.''.
SEC. 2103. IMPROVING PROGRAM INTEGRITY BY BETTER RECOVERY OF
OVERPAYMENTS.
(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 each amended by striking ``may'' and inserting ``shall''.
(b) Use of Unemployment Compensation To Repay Federal
Additional Compensation Overpayments.--Section 303(g)(3) of the
Social Security Act is amended by inserting ``Federal
additional compensation,'' after ``trade adjustment
allowances,''.
(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. 2104. DATA EXCHANGE STANDARDIZATION FOR IMPROVED INTEROPERABILITY.
(a) In General.--Title IX of the Social Security Act is
amended by adding at the end the following:
``DATA EXCHANGE STANDARDIZATION FOR IMPROVED INTEROPERABILITY
``Data Exchange Standards
``Sec. 911. (a)(1) The Secretary of Labor, in consultation
with an interagency work group which shall be established by
the Office of Management and Budget, and considering State and
employer perspectives, shall, by rule, designate a data
exchange standard for any category of information required
under title III, title XII, or this title.
``(2) Data exchange standards designated under paragraph
(1) shall, to the extent practicable, be nonproprietary and
interoperable.
``(3) In designating data exchange standards 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 Exchange 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 and employer perspectives,
shall, by rule, designate data exchange standards to govern the
reporting required under title III, title XII, or this title.
``(2) The data exchange standards required by paragraph (1)
shall, to the extent practicable--
``(A) incorporate a widely accepted,
nonproprietary, 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 Markup Language.''.
(b) Effective Dates.--
(1) Data exchange standards.--The Secretary of
Labor shall issue a proposed rule under section
911(a)(1) of the Social Security Act (as added by
subsection (a)) within 12 months after the date of the
enactment of this section, and shall issue a final rule
under such section 911(a)(1), after public comment,
within 24 months after such date of enactment.
(2) Data reporting standards.--The reporting
standards required under section 911(b)(1) of such Act
(as so added) shall become effective with respect to
reports required in the first reporting period, after
the effective date of the final rule referred to in
paragraph (1) of this subsection, for which the
authority for data collection and reporting is
established or renewed under the Paperwork Reduction
Act.
SEC. 2105. DRUG TESTING OF APPLICANTS.
Section 303 of the Social Security Act is amended by adding
at the end the following:
``(l)(1) Nothing in this Act or any other provision of
Federal law shall be considered to prevent a State from
enacting legislation to provide for--
``(A) testing an applicant for unemployment
compensation for the unlawful use of controlled
substances as a condition for receiving such
compensation, if such applicant--
``(i) was terminated from employment with
the applicant's most recent employer (as
defined under the State law) because of the
unlawful use of controlled substances; or
``(ii) is an individual for whom suitable
work (as defined under the State law) is only
available in an occupation that regularly
conducts drug testing (as determined under
regulations issued by the Secretary of Labor);
or
``(B) denying such compensation to such applicant
on the basis of the result of the testing conducted by
the State under legislation described in subparagraph
(A).
``(2) For purposes of this subsection--
``(A) the term `unemployment compensation' has the
meaning given such term in subsection (d)(2)(A); and
``(B) the term `controlled substance' has the
meaning given such term in section 102 of the
Controlled Substances Act (21 U.S.C. 802).''.
Subtitle B--Provisions Relating To Extended Benefits
SEC. 2121. SHORT TITLE.
This subtitle may be cited as the ``Unemployment Benefits
Extension Act of 2012''.
SEC. 2122. EXTENSION AND MODIFICATION OF EMERGENCY UNEMPLOYMENT
COMPENSATION PROGRAM.
(a) Extension.--Section 4007 of the Supplemental
Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304
note) is amended--
(1) in subsection (a)--
(A) by striking ``Except as provided in
subsection (b), an'' and inserting ``An''; and
(B) by striking ``March 6, 2012'' and
inserting ``January 2, 2013''; and
(2) by striking subsection (b) and inserting the
following:
``(b) Termination.--No compensation under this title shall
be payable for any week subsequent to the last week described
in subsection (a).''.
(b) Modifications Relating to Triggers.--
(1) For second-tier emergency unemployment
compensation.--Section 4002(c) of such Act is amended--
(A) in the subsection heading, by striking
``Special Rule'' and inserting ``Second-tier
Emergency Unemployment Compensation'';
(B) in paragraph (1), by striking ``At''
and all that follows through ``augmented by an
amount'' and inserting ``If, at the time that
the amount established in an individual's
account under subsection (b) is exhausted or at
any time thereafter, such individual's State is
in an extended benefit period (as determined
under paragraph (2)), such account shall be
augmented by an amount (hereinafter `second-
tier emergency unemployment compensation')'';
(C) by redesignating paragraph (2) as
paragraph (4); and
(D) by inserting after paragraph (1) the
following:
``(2) Extended benefit period.--For purposes of
paragraph (1), a State shall be considered to be in an
extended benefit period, as of any given time, if such
a period would then be in effect for such State under
such Act if--
``(A) section 203(f) of the Federal-State
Extended Unemployment Compensation Act of 1970
were applied to such State (regardless of
whether the State by law had provided for such
application); and
``(B) such section 203(f)--
``(i) were applied by substituting
the applicable percentage under
paragraph (3) for `6.5 percent' in
paragraph (1)(A)(i) thereof; and
``(ii) did not include the
requirement under paragraph (1)(A)(ii)
thereof.
``(3) Applicable percentage.--The applicable
percentage under this paragraph is, for purposes of
determining if a State is in an extended benefit period
as of a date occurring in a week ending--
``(A) before June 1, 2012, 0 percent; and
``(B) after the last week under
subparagraph (A), 6 percent.''.
(2) For third-tier emergency unemployment
compensation.--Section 4002(d) of such Act is amended--
(A) in paragraph (2)(A), by striking
``under such Act'' and inserting ``under the
Federal-State Extended Unemployment
Compensation Act of 1970'';
(B) in paragraph (2)(B)(ii)(I), by striking
the matter after ``substituting'' and before
``in paragraph (1)(A)(i) thereof'' and
inserting ``the applicable percentage under
paragraph (3) for `6.5 percent''';
(C) by redesignating paragraph (3) as
paragraph (4); and
(D) by inserting after paragraph (2) the
following:
``(3) Applicable percentage.--The applicable
percentage under this paragraph is, for purposes of
determining if a State is in an extended benefit period
as of a date occurring in a week ending--
``(A) before June 1, 2012, 6 percent; and
``(B) after the last week under
subparagraph (A), 7 percent.''.
(3) For fourth-tier emergency unemployment
compensation.--Section 4002(e) of such Act is amended--
(A) in paragraph (2)(A), by striking
``under such Act'' and inserting ``under the
Federal-State Extended Unemployment
Compensation Act of 1970'';
(B) in paragraph (2)(B)(ii)(I), by striking
the matter after ``substituting'' and before
``in paragraph (1)(A)(i) thereof'' and
inserting ``the applicable percentage under
paragraph (3) for `6.5 percent''';
(C) by redesignating paragraph (3) as
paragraph (4); and
(D) by inserting after paragraph (2) the
following:
``(3) Applicable percentage.--The applicable
percentage under this paragraph is, for purposes of
determining if a State is in an extended benefit period
as of a date occurring in a week ending--
``(A) before June 1, 2012, 8.5 percent; and
``(B) after the last week under
subparagraph (A), 9 percent.''.
(c) Modifications Relating to Weeks of Emergency
Unemployment Compensation.--
(1) Number of weeks in first tier beginning after
september 2, 2012.--Section 4002(b) of such Act is
amended--
(A) by redesignating paragraph (2) as
paragraph (3); and
(B) by inserting after paragraph (1) the
following:
``(2) Special rule relating to amounts established
in an account as of a week ending after september 2,
2012.--Notwithstanding any provision of paragraph (1),
in the case of any account established as of a week
ending after September 2, 2012--
``(A) paragraph (1)(A) shall be applied by
substituting `54 percent' for `80 percent'; and
``(B) paragraph (1)(B) shall be applied by
substituting `14 weeks' for `20 weeks'.''.
(2) Number of weeks in third tier beginning after
september 2, 2012.--Section 4002(d) of such Act is
amended by adding after paragraph (4) (as so
redesignated by subsection (b)(2)(C)) the following:
``(5) Special rule relating to amounts added to an
account as of a week ending after september 2, 2012.--
Notwithstanding any provision of paragraph (1), if
augmentation under this subsection occurs as of a week
ending after September 2, 2012--
``(A) paragraph (1)(A) shall be applied by
substituting `35 percent' for `50 percent'; and
``(B) paragraph (1)(B) shall be applied by
substituting `9 times' for `13 times'.''.
(3) Number of weeks in fourth tier.--Section
4002(e) of such Act is amended by adding after
paragraph (4) (as so redesignated by subsection
(b)(3)(C)) the following:
``(5) Special rules relating to amounts added to an
account.--
``(A) March to may of 2012.--
``(i) Special rule.--
Notwithstanding any provision of
paragraph (1) but subject to the
following 2 sentences, if augmentation
under this subsection occurs as of a
week ending after the date of enactment
of this paragraph and before June 1,
2012 (or if, as of such date of
enactment, any fourth-tier amounts
remain in the individual's account)--
``(I) paragraph (1)(A)
shall be applied by
substituting `62 percent' for
`24 percent'; and
``(II) paragraph (1)(B)
shall be applied by
substituting `16 times' for `6
times'.
The preceding sentence shall apply only
if, at the time that the account would
be augmented under this subparagraph,
such individual's State is not in an
extended benefit period as determined
under the Federal-State Extended
Unemployment Compensation Act of 1970.
In no event shall the total amount
added to the account of an individual
under this subparagraph cause, in the
case of an individual described in the
parenthetical matter in the first
sentence of this clause, the sum of the
total amount previously added to such
individual's account under this
subsection (as in effect before the
date of enactment of this paragraph)
and any further amounts added as a
result of the enactment of this clause,
to exceed the total amount allowable
under subclause (I) or (II), as the
case may be.
``(ii) Limitation.--Notwithstanding
any other provision of this title, the
amounts added to the account of an
individual under this subparagraph may
not cause the sum of the amounts
previously established in or added to
such account, plus any weeks of
extended benefits provided to such
individual under the Federal-State
Extended Unemployment Compensation Act
of 1970 (based on the same exhaustion
of regular compensation under section
4001(b)(1)), to in the aggregate exceed
the lesser of--
``(I) 282 percent of the
total amount of regular
compensation (including
dependents' allowances) payable
to the individual during the
individual's benefit year under
the State law; or
``(II) 73 times the
individual's average weekly
benefit amount (as determined
under subsection (b)(3)) for
the benefit year.
``(B) After august of 2012.--
Notwithstanding any provision of paragraph (1),
if augmentation under this subsection occurs as
of a week ending after September 2, 2012--
``(i) paragraph (1)(A) shall be
applied by substituting `39 percent'
for `24 percent'; and
``(ii) paragraph (1)(B) shall be
applied by substituting `10 times' for
`6 times'.''.
(d) Order of Payments Requirement.--
(1) In general.--Section 4001(e) of such Act is
amended to read as follows:
``(e) Coordination Rule.--An agreement under this section
shall apply with respect to a State only upon a determination
by the Secretary that, under the State law or other applicable
rules of such State, the payment of extended compensation for
which an individual is otherwise eligible must be deferred
until after the payment of any emergency unemployment
compensation under section 4002, as amended by the Unemployment
Benefits Extension Act of 2012, for which the individual is
concurrently eligible.''.
(2) Technical and conforming amendments.--Section
4001(b)(2) of such Act is amended--
(A) by striking ``or extended
compensation''; and
(B) by striking ``law (except as provided
under subsection (e));'' and inserting
``law;''.
(e) Funding.--Section 4004(e)(1) of such Act is amended--
(1) in subparagraph (G), by striking ``and'' at the
end; and
(2) by inserting after subparagraph (H) the
following:
``(I) the amendments made by section 2122
of the Unemployment Benefits Extension Act of
2012; and''.
(f) Effective Dates.--
(1) In general.--The amendments made by subsections
(b), (c), and (d) shall take effect as of February 28,
2012, and shall apply with respect to weeks of
unemployment beginning after that date.
(2) Week defined.--For purposes of this subsection,
the term ``week'' has the meaning given such term under
section 4006 of the Supplemental Appropriations Act,
2008.
SEC. 2123. TEMPORARY EXTENSION OF EXTENDED BENEFIT PROVISIONS.
(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) by striking ``March 7, 2012'' each place it
appears and inserting ``December 31, 2012''; and
(2) in subsection (c), by striking ``August 15,
2012'' and inserting ``June 30, 2013''.
(b) Extension of Matching for States With no Waiting
Week.--Section 5 of the Unemployment Compensation Extension Act
of 2008 (Public Law 110-449; 26 U.S.C. 3304 note) is amended by
striking ``August 15, 2012'' and inserting ``June 30, 2013''.
(c) Extension of Modification of Indicators Under the
Extended Benefit Program.--Section 203 of the Federal-State
Extended Unemployment Compensation Act of 1970 (26 U.S.C. 3304
note) is amended--
(1) in subsection (d), by striking ``February 29,
2012'' and inserting ``December 31, 2012''; and
(2) in subsection (f)(2), by striking ``February
29, 2012'' and inserting ``December 31, 2012''.
(d) Effective Date.--The amendments made by this section
shall take effect as if included in the enactment of the
Temporary Payroll Tax Cut Continuation Act of 2011 (Public Law
112-78).
SEC. 2124. ADDITIONAL EXTENDED UNEMPLOYMENT BENEFITS UNDER THE RAILROAD
UNEMPLOYMENT INSURANCE ACT.
(a) Extension.--Section 2(c)(2)(D)(iii) of the Railroad
Unemployment Insurance Act, as added by section 2006 of the
American Recovery and Reinvestment Act of 2009 (Public Law 96
111-5) and as amended by section 9 of the Worker,
Homeownership, and Business Assistance Act of 2009 (Public Law
111-92), section 505 of the Tax Relief, Unemployment Insurance
Reauthorization, and Job Creation Act of 2010 (Public Law 111-
312), and section 202 of the Temporary Payroll Tax Cut
Continuation Act of 2011 (Public Law 112-78), is amended--
(1) by striking ``August 31, 2011'' and inserting
``June 30, 2012''; and
(2) by striking ``February 29, 2012'' and inserting
``December 31, 2012''.
(b) Clarification on Authority To Use Funds.--Funds
appropriated under either the first or second sentence of
clause (iv) of section 2(c)(2)(D) of the Railroad Unemployment
Insurance Act shall be available to cover the cost of
additional extended unemployment benefits provided under such
section 2(c)(2)(D) by reason of the amendments made by
subsection (a) as well as to cover the cost of such benefits
provided under such section 2(c)(2)(D), as in effect on the day
before the date of enactment of this Act.
(c) Funding for Administration.--Out of any funds in the
Treasury not otherwise appropriated, there are appropriated to
the Railroad Retirement Board $500,000 for administrative
expenses associated with the payment of additional extended
unemployment benefits provided under section 2(c)(2)(D) of the
Railroad Unemployment Insurance Act by reason of the amendments
made by subsection (a), to remain available until expended.
Subtitle C--Improving Reemployment Strategies Under the Emergency
Unemployment Compensation Program
SEC. 2141. IMPROVED WORK SEARCH FOR THE LONG-TERM UNEMPLOYED.
(a) In General.--Section 4001(b) of the Supplemental
Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304
note) is amended--
(1) by striking ``and'' at the end of paragraph
(2);
(2) by striking the period at the end of paragraph
(3) and inserting ``; and''; and
(3) by adding at the end the following:
``(4) are able to work, available to work, and
actively seeking work.''.
(b) Actively Seeking Work.--Section 4001 of such Act is
amended by adding at the end the following:
``(h) Actively Seeking Work.--
``(1) In general.--For purposes of subsection
(b)(4), the term `actively seeking work' means, with
respect to any individual, that such individual--
``(A) is registered for employment services
in such a manner and to such extent as
prescribed by the State agency;
``(B) has engaged in an active search for
employment that is appropriate in light of the
employment available in the labor market, the
individual's skills and capabilities, and
includes a number of employer contacts that is
consistent with the standards communicated to
the individual by the State;
``(C) has maintained a record of such work
search, including employers contacted, method
of contact, and date contacted; and
``(D) when requested, has provided such
work search record to the State agency.
``(2) Random auditing.--The Secretary shall
establish for each State a minimum number of claims for
which work search records must be audited on a random
basis in any given week.''.
SEC. 2142. REEMPLOYMENT SERVICES AND REEMPLOYMENT AND ELIGIBILITY
ASSESSMENT ACTIVITIES.
(a) Provision of Services and Activities.--Section 4001 of
such Act, as amended by section 2141(b), is further amended by
added at the end the following:
``(i) Provision of Services and Activities.--
``(1) In general.--An agreement under this section
shall require the following:
``(A) The State which is party to such
agreement shall provide reemployment services
and reemployment and eligibility assessment
activities to each individual--
``(i) who, on or after the 30th day
after the date of enactment of the
Extended Benefits, Reemployment, and
Program Integrity Improvement Act,
begins receiving amounts described in
subsections (b) and (c); and
``(ii) while such individual
continues to receive emergency
unemployment compensation under this
title.
``(B) As a condition of eligibility for
emergency unemployment compensation for any
week--
``(i) a claimant who has been duly
referred to reemployment services shall
participate in such services; and
``(ii) a claimant shall be actively
seeking work (determined applying
subsection (i)).
``(2) Description of services and activities.--The
reemployment services and in-person reemployment and
eligibility assessment activities provided to
individuals receiving emergency unemployment
compensation described in paragraph (1)--
``(A) shall include--
``(i) the provision of labor market
and career information;
``(ii) an assessment of the skills
of the individual;
``(iii) orientation to the services
available through the one-stop centers
established under title I of the
Workforce Investment Act of 1998; and
``(iv) review of the eligibility of
the individual for emergency
unemployment compensation relating to
the job search activities of the
individual; and
``(B) may include the provision of--
``(i) comprehensive and specialized
assessments;
``(ii) individual and group career
counseling;
``(iii) training services;
``(iv) additional reemployment
services; and
``(v) job search counseling and the
development or review of an individual
reemployment plan that includes
participation in job search activities
and appropriate workshops.
``(3) Participation requirement.--As a condition of
continuing eligibility for emergency unemployment
compensation for any week, an individual who has been
referred to reemployment services or reemployment and
eligibility assessment activities under this subsection
shall participate in such services or activities,
unless the State agency responsible for the
administration of State unemployment compensation law
determines that--
``(A) such individual has completed
participating in such services or activities;
or
``(B) there is justifiable cause for
failure to participate or to complete
participating in such services or activities,
as determined in accordance with guidance to be
issued by the Secretary.''.
(b) Issuance of Guidance.--Not later than 30 days after the
date of enactment of this Act, the Secretary shall issue
guidance on the implementation of the reemployment services and
reemployment and eligibility assessment activities required to
be provided under the amendment made by subsection (a).
(c) Funding.--
(1) In general.--Section 4004(c) of the
Supplemental Appropriations Act, 2008 (Public Law 110-
252; 26 U.S.C. 3304 note) is amended--
(A) by striking ``States.--There'' and
inserting the following: ``States.--
``(1) Administration.--There''; and
(B) by adding at the end the following new
paragraph:
``(2) Reemployment services and reemployment and
eligibility assessment activities.--
``(A) Appropriation.--There are
appropriated from the general fund of the
Treasury, for the period of fiscal year 2012
through fiscal year 2013, out of the employment
security administration account (as established
by section 901(a) of the Social Security Act),
such sums as determined by the Secretary of
Labor in accordance with subparagraph (B) to
assist States in providing reemployment
services and reemployment and eligibility
assessment activities described in section
4001(h)(2).
``(B) Determination of total amount.--The
amount referred to in subparagraph (A) is the
amount the Secretary of Labor estimates is
equal to--
``(i) the number of individuals who
will receive reemployment services and
reemployment eligibility and assessment
activities described in section
4001(h)(2) in all States through the
date specified in section 4007(b)(3);
multiplied by
``(ii) $85.
``(C) Distribution among states.--Of the
amounts appropriated under subparagraph (A),
the Secretary of Labor shall distribute amounts
to each State, in accordance with section
4003(c), that the Secretary estimates is equal
to--
``(i) the number of individuals who
will receive reemployment services and
reemployment and eligibility assessment
activities described in section
4001(h)(2) in such State through the
date specified in section 4007(b)(3);
multiplied by
``(ii) $85.''.
(2) Transfer of funds.--Section 4004(e) of the
Supplemental Appropriations Act, 2008 (Public Law 110-
252; 26 U.S.C. 3304 note) is amended--
(A) in paragraph (1)(G), by striking
``and'' at the end;
(B) in paragraph (2), by striking the
period at the end and inserting ``; and''; and
(C) by adding at the end the following
paragraph:
``(3) to the Employment Security Administration
account (as established by section 901(a) of the Social
Security Act) such sums as the Secretary of Labor
determines to be necessary in accordance with
subsection (c)(2) to assist States in providing
reemployment services and reemployment eligibility and
assessment activities described in section
4001(h)(2).''.
SEC. 2143. PROMOTING PROGRAM INTEGRITY THROUGH BETTER RECOVERY OF
OVERPAYMENTS.
Section 4005(c)(1) of the Supplemental Appropriations Act,
2008 (Public Law 110-252; 26 U.S.C. 3304 note) is amended--
(1) by striking ``may'' and inserting ``shall'';
and
(2) by striking ``except that'' and all that
follows through ``made'' and inserting ``in accordance
with the same procedures as apply to the recovery of
overpayments of regular unemployment benefits paid by
the State''.
SEC. 2144. RESTORE STATE FLEXIBILITY TO IMPROVE UNEMPLOYMENT PROGRAM
SOLVENCY.
Subsection (g) of section 4001 of the Supplemental
Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304
note) shall not apply with respect to a State that has enacted
a law before March 1, 2012, that, upon taking effect, would
violate such subsection.
Subtitle D--Short-Time Compensation Program
SEC. 2160. SHORT TITLE.
This subtitle may be cited as the ``Layoff Prevention Act
of 2012''.
SEC. 2161. TREATMENT OF SHORT-TIME COMPENSATION PROGRAMS.
(a) Definition.--
(1) In general.--Section 3306 of the Internal
Revenue Code of 1986 (26 U.S.C. 3306) is amended by
adding at the end the following new subsection:
``(v) Short-Time Compensation Program.--For purposes of
this part, the term `short-time compensation program' means a
program under which--
``(1) the participation of an employer is
voluntary;
``(2) an employer reduces the number of hours
worked by employees in lieu of layoffs;
``(3) such employees whose workweeks have been
reduced by at least 10 percent, and by not more than
the percentage, if any, that is determined by the State
to be appropriate (but in no case more than 60
percent), are not disqualified from unemployment
compensation;
``(4) the amount of unemployment compensation
payable to any such employee is a pro rata portion of
the unemployment compensation which would otherwise be
payable to the employee if such employee were
unemployed;
``(5) such employees meet the availability for work
and work search test requirements while collecting
short-time compensation benefits, by being available
for their workweek as required by the State agency;
``(6) eligible employees may participate, as
appropriate, in training (including employer-sponsored
training or worker training funded under the Workforce
Investment Act of 1998) to enhance job skills if such
program has been approved by the State agency;
``(7) the State agency shall require employers to
certify that if the employer provides health benefits
and retirement benefits under a defined benefit plan
(as defined in section 414(j)) or contributions under a
defined contribution plan (as defined in section
414(i)) to any employee whose workweek is reduced under
the program that such benefits will continue to be
provided to employees participating in the short-time
compensation program under the same terms and
conditions as though the workweek of such employee had
not been reduced or to the same extent as other
employees not participating in the short-time
compensation program;
``(8) the State agency shall require an employer to
submit a written plan describing the manner in which
the requirements of this subsection will be implemented
(including a plan for giving advance notice, where
feasible, to an employee whose workweek is to be
reduced) together with an estimate of the number of
layoffs that would have occurred absent the ability to
participate in short-time compensation and such other
information as the Secretary of Labor determines is
appropriate;
``(9) the terms of the employer's written plan and
implementation shall be consistent with employer
obligations under applicable Federal and State laws;
and
``(10) upon request by the State and approval by
the Secretary of Labor, only such other provisions are
included in the State law that are determined to be
appropriate for purposes of a short-time compensation
program.''.
(2) Effective date.--Subject to paragraph (3), the
amendment made by paragraph (1) shall take effect on
the date of the enactment of this Act.
(3) Transition period for existing programs.--In
the case of a State that is administering a short-time
compensation program as of the date of the enactment of
this Act and the State law cannot be administered
consistent with the amendment made by paragraph (1),
such amendment shall take effect on the earlier of--
(A) the date the State changes its State
law in order to be consistent with such
amendment; or
(B) the date that is 2 years and 6 months
after the date of the enactment of this Act.
(b) Conforming Amendments.--
(1) Internal revenue code of 1986.--
(A) Subparagraph (E) of section 3304(a)(4)
of the Internal Revenue Code of 1986 is amended
to read as follows:
``(E) amounts may be withdrawn for the
payment of short-time compensation under a
short-time compensation program (as defined
under section 3306(v));''.
(B) Subsection (f) of section 3306 of the
Internal Revenue Code of 1986 is amended--
(i) by striking paragraph (5)
(relating to short-time compensation)
and inserting the following new
paragraph:
``(5) amounts may be withdrawn for the payment of
short-time compensation under a short-time compensation
program (as defined in subsection (v)); and''; and
(ii) by redesignating paragraph (5)
(relating to self-employment assistance
program) as paragraph (6).
(2) Social security act.--Section 303(a)(5) of the
Social Security Act is amended by striking ``the
payment of short-time compensation under a plan
approved by the Secretary of Labor'' and inserting
``the payment of short-time compensation under a short-
time compensation program (as defined in section
3306(v) of the Internal Revenue Code of 1986)''.
(3) Unemployment compensation amendments of 1992.--
Subsections (b) through (d) of section 401 of the
Unemployment Compensation Amendments of 1992 (26 U.S.C.
3304 note) are repealed.
SEC. 2162. TEMPORARY FINANCING OF SHORT-TIME COMPENSATION PAYMENTS IN
STATES WITH PROGRAMS IN LAW.
(a) Payments to States.--
(1) In general.--Subject to paragraph (3), there
shall be paid to a State an amount equal to 100 percent
of the amount of short-time compensation paid under a
short-time compensation program (as defined in section
3306(v) of the Internal Revenue Code of 1986, as added
by section 2161(a)) under the provisions of the State
law.
(2) Terms of payments.--Payments made to a State
under paragraph (1) shall be payable by way of
reimbursement in such amounts as the Secretary
estimates the State will be entitled to receive under
this section 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.
(3) Limitations on payments.--
(A) General payment limitations.--No
payments shall be made to a State under this
section for short-time compensation paid to an
individual by the State during a benefit year
in excess of 26 times the amount of regular
compensation (including dependents' allowances)
under the State law payable to such individual
for a week of total unemployment.
(B) Employer limitations.--No payments
shall be made to a State under this section for
benefits paid to an individual by the State
under a short-time compensation program if such
individual is employed by the participating
employer on a seasonal, temporary, or
intermittent basis.
(b) Applicability.--
(1) In general.--Payments to a State under
subsection (a) shall be available for weeks of
unemployment--
(A) beginning on or after the date of the
enactment of this Act; and
(B) ending on or before the date that is 3
years and 6 months after the date of the
enactment of this Act.
(2) Three-year funding limitation for combined
payments under this section and section 2163.--States
may receive payments under this section and section
2163 with respect to a total of not more than 156
weeks.
(c) Two-Year Transition Period for Existing Programs.--
During any period that the transition provision under section
2161(a)(3) is applicable to a State with respect to a short-
time compensation program, such State shall be eligible for
payments under this section. Subject to paragraphs (1)(B) and
(2) of subsection (b), if at any point after the date of the
enactment of this Act the State enacts a State law providing
for the payment of short-time compensation under a short-time
compensation program that meets the definition of such a
program under section 3306(v) of the Internal Revenue Code of
1986, as added by section 2161(a), the State shall be eligible
for payments under this section after the effective date of
such enactment.
(d) Funding and Certifications.--
(1) Funding.--There are appropriated, out of moneys
in the Treasury not otherwise appropriated, such sums
as may be necessary for purposes of carrying out this
section.
(2) Certifications.--The Secretary shall from time
to time certify to the Secretary of the Treasury for
payment to each State the sums payable to such State
under this section.
(e) Definitions.--In this section:
(1) Secretary.--The term ``Secretary'' means the
Secretary of Labor.
(2) State; state agency; state law.--The terms
``State'', ``State agency'', and ``State law'' have the
meanings given those terms in section 205 of the
Federal-State Extended Unemployment Compensation Act of
1970 (26 U.S.C. 3304 note).
SEC. 2163. TEMPORARY FINANCING OF SHORT-TIME COMPENSATION AGREEMENTS.
(a) Federal-State Agreements.--
(1) In general.--Any State which desires to do so
may enter into, and participate in, an agreement under
this section with the Secretary provided that such
State's law does not provide for the payment of short-
time compensation under a short-time compensation
program (as defined in section 3306(v) of the Internal
Revenue Code of 1986, as added by section 2161(a)).
(2) Ability to terminate.--Any State which is a
party to an agreement under this section may, upon
providing 30 days' written notice to the Secretary,
terminate such agreement.
(b) Provisions of Federal-State Agreement.--
(1) In general.--Any agreement under this section
shall provide that the State agency of the State will
make payments of short-time compensation under a plan
approved by the State. Such plan shall provide that
payments are made in accordance with the requirements
under section 3306(v) of the Internal Revenue Code of
1986, as added by section 2161(a).
(2) Limitations on plans.--
(A) General payment limitations.--A short-
time compensation plan approved by a State
shall not permit the payment of short-time
compensation to an individual by the State
during a benefit year in excess of 26 times the
amount of regular compensation (including
dependents' allowances) under the State law
payable to such individual for a week of total
unemployment.
(B) Employer limitations.--A short-time
compensation plan approved by a State shall not
provide payments to an individual if such
individual is employed by the participating
employer on a seasonal, temporary, or
intermittent basis.
(3) Employer payment of costs.--Any short-time
compensation plan entered into by an employer must
provide that the employer will pay the State an amount
equal to one-half of the amount of short-time
compensation paid under such plan. Such amount shall be
deposited in the State's unemployment fund and shall
not be used for purposes of calculating an employer's
contribution rate under section 3303(a)(1) of the
Internal Revenue Code of 1986.
(c) Payments to States.--
(1) In general.--There shall be paid to each State
with an agreement under this section an amount equal
to--
(A) one-half of the amount of short-time
compensation paid to individuals by the State
pursuant to such agreement; and
(B) any additional administrative expenses
incurred by the State by reason of such
agreement (as determined by the Secretary).
(2) Terms of payments.--Payments made to a State
under paragraph (1) shall be payable by way of
reimbursement in such amounts as the Secretary
estimates the State will be entitled to receive under
this section 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.
(3) Funding.--There are appropriated, out of moneys
in the Treasury not otherwise appropriated, such sums
as may be necessary for purposes of carrying out this
section.
(4) Certifications.--The Secretary shall from time
to time certify to the Secretary of the Treasury for
payment to each State the sums payable to such State
under this section.
(d) Applicability.--
(1) In general.--An agreement entered into under
this section shall apply to weeks of unemployment--
(A) beginning on or after the date on which
such agreement is entered into; and
(B) ending on or before the date that is 2
years and 13 weeks after the date of the
enactment of this Act.
(2) Two-year funding limitation.--States may
receive payments under this section with respect to a
total of not more than 104 weeks.
(e) Special Rule.--If a State has entered into an agreement
under this section and subsequently enacts a State law
providing for the payment of short-time compensation under a
short-time compensation program that meets the definition of
such a program under section 3306(v) of the Internal Revenue
Code of 1986, as added by section 2161(a), the State--
(1) shall not be eligible for payments under this
section for weeks of unemployment beginning after the
effective date of such State law; and
(2) subject to paragraphs (1)(B) and (2) of section
2162(b), shall be eligible to receive payments under
section 2162 after the effective date of such State
law.
(f) Definitions.--In this section:
(1) Secretary.--The term ``Secretary'' means the
Secretary of Labor.
(2) State; state agency; state law.--The terms
``State'', ``State agency'', and ``State law'' have the
meanings given those terms in section 205 of the
Federal-State Extended Unemployment Compensation Act of
1970 (26 U.S.C. 3304 note).
SEC. 2164. GRANTS FOR SHORT-TIME COMPENSATION PROGRAMS.
(a) Grants.--
(1) For implementation or improved
administration.--The Secretary shall award grants to
States that enact short-time compensation programs (as
defined in subsection (i)(2)) for the purpose of
implementation or improved administration of such
programs.
(2) For promotion and enrollment.--The Secretary
shall award grants to States that are eligible and
submit plans for a grant under paragraph (1) for such
States to promote and enroll employers in short-time
compensation programs (as so defined).
(3) Eligibility.--
(A) In general.--The Secretary shall
determine eligibility criteria for the grants
under paragraphs (1) and (2).
(B) Clarification.--A State administering a
short-time compensation program, including a
program being administered by a State that is
participating in the transition under the
provisions of sections 301(a)(3) and 302(c),
that does not meet the definition of a short-
time compensation program under section 3306(v)
of the Internal Revenue Code of 1986 (as added
by 211(a)), and a State with an agreement under
section 2163, shall not be eligible to receive
a grant under this section until such time as
the State law of the State provides for
payments under a short-time compensation
program that meets such definition and such
law.
(b) Amount of Grants.--
(1) In general.--The maximum amount available for
making grants to a State under paragraphs (1) and (2)
shall be equal to the amount obtained by multiplying
$100,000,000 (less the amount used by the Secretary
under subsection (e)) by the same ratio as would apply
under subsection (a)(2)(B) of section 903 of the Social
Security Act (42 U.S.C. 1103) for purposes of
determining such State's share of any excess amount (as
described in subsection (a)(1) of such section) that
would have been subject to transfer to State accounts,
as of October 1, 2010, under the provisions of
subsection (a) of such section.
(2) Amount available for different grants.--Of the
maximum incentive payment determined under paragraph
(1) with respect to a State--
(A) one-third shall be available for a
grant under subsection (a)(1); and
(B) two-thirds shall be available for a
grant under subsection (a)(2).
(c) Grant Application and Disbursal.--
(1) Application.--Any State seeking a grant under
paragraph (1) or (2) of subsection (a) shall submit an
application to the Secretary at such time, in such
manner, and complete with such information as the
Secretary may require. In no case may the Secretary
award a grant under this section with respect to an
application that is submitted after December 31, 2014.
(2) Notice.--The Secretary shall, within 30 days
after receiving a complete application, notify the
State agency of the State of the Secretary's findings
with respect to the requirements for a grant under
paragraph (1) or (2) (or both) of subsection (a).
(3) Certification.--If the Secretary finds that the
State law provisions meet the requirements for a grant
under subsection (a), the Secretary shall thereupon
make a certification to that effect to the Secretary of
the Treasury, together with a certification as to the
amount of the grant payment to be transferred to the
State account in the Unemployment Trust Fund (as
established in section 904(a) of the Social Security
Act (42 U.S.C. 1104(a))) pursuant to that finding. The
Secretary of the Treasury shall make the appropriate
transfer to the State account within 7 days after
receiving such certification.
(4) Requirement.--No certification of compliance
with the requirements for a grant under paragraph (1)
or (2) of subsection (a) may be made with respect to
any State whose--
(A) State law is not otherwise eligible for
certification under section 303 of the Social
Security Act (42 U.S.C. 503) or approvable
under section 3304 of the Internal Revenue Code
of 1986; or
(B) short-time compensation program is
subject to discontinuation or is not scheduled
to take effect within 12 months of the
certification.
(d) Use of Funds.--The amount of any grant awarded under
this section shall be used for the implementation of short-time
compensation programs and the overall administration of such
programs and the promotion and enrollment efforts associated
with such programs, such as through--
(1) the creation or support of rapid response teams
to advise employers about alternatives to layoffs;
(2) the provision of education or assistance to
employers to enable them to assess the feasibility of
participating in short-time compensation programs; and
(3) the development or enhancement of systems to
automate--
(A) the submission and approval of plans;
and
(B) the filing and approval of new and
ongoing short-time compensation claims.
(e) Administration.--The Secretary is authorized to use
0.25 percent of the funds available under subsection (g) to
provide for outreach and to share best practices with respect
to this section and short-time compensation programs.
(f) Recoupment.--The Secretary shall establish a process
under which the Secretary shall recoup the amount of any grant
awarded under paragraph (1) or (2) of subsection (a) if the
Secretary determines that, during the 5-year period beginning
on the first date that any such grant is awarded to the State,
the State--
(1) terminated the State's short-time compensation
program; or
(2) failed to meet appropriate requirements with
respect to such program (as established by the
Secretary).
(g) Funding.--There are appropriated, out of moneys in the
Treasury not otherwise appropriated, to the Secretary,
$100,000,000 to carry out this section, to remain available
without fiscal year limitation.
(h) Reporting.--The Secretary may establish reporting
requirements for States receiving a grant under this section in
order to provide oversight of grant funds.
(i) Definitions.--In this section:
(1) Secretary.--The term ``Secretary'' means the
Secretary of Labor.
(2) Short-time compensation program.--The term
``short-time compensation program'' has the meaning
given such term in section 3306(v) of the Internal
Revenue Code of 1986, as added by section 2161(a).
(3) State; state agency; state law.--The terms
``State'', ``State agency'', and ``State law'' have the
meanings given those terms in section 205 of the
Federal-State Extended Unemployment Compensation Act of
1970 (26 U.S.C. 3304 note).
SEC. 2165. ASSISTANCE AND GUIDANCE IN IMPLEMENTING PROGRAMS.
(a) In General.--In order to assist States in establishing,
qualifying, and implementing short-time compensation programs
(as defined in section 3306(v) of the Internal Revenue Code of
1986, as added by section 2161(a)), the Secretary of Labor (in
this section referred to as the ``Secretary'') shall--
(1) develop model legislative language which may be
used by States in developing and enacting such programs
and periodically review and revise such model
legislative language;
(2) provide technical assistance and guidance in
developing, enacting, and implementing such programs;
(3) establish reporting requirements for States,
including reporting on--
(A) the number of estimated averted
layoffs;
(B) the number of participating employers
and workers; and
(C) such other items as the Secretary of
Labor determines are appropriate.
(b) Model Language and Guidance.--The model language and
guidance developed under subsection (a) shall allow sufficient
flexibility by States and participating employers while
ensuring accountability and program integrity.
(c) Consultation.--In developing the model legislative
language and guidance under subsection (a), and in order to
meet the requirements of subsection (b), the Secretary shall
consult with employers, labor organizations, State workforce
agencies, and other program experts.
SEC. 2166. REPORTS.
(a) Report.--
(1) In general.--Not later than 4 years after the
date of the enactment of this Act, the Secretary of
Labor shall submit to Congress and to the President a
report or reports on the implementation of the
provisions of this subtitle.
(2) Requirements.--Any report under paragraph (1)
shall at a minimum include the following:
(A) A description of best practices by
States and employers in the administration,
promotion, and use of short-time compensation
programs (as defined in section 3306(v) of the
Internal Revenue Code of 1986, as added by
section 2161(a)).
(B) An analysis of the significant
challenges to State enactment and
implementation of short-time compensation
programs.
(C) A survey of employers in all States to
determine the level of interest in
participating in short-time compensation
programs.
(b) Funding.--There are appropriated, out of any moneys in
the Treasury not otherwise appropriated, to the Secretary of
Labor, $1,500,000 to carry out this section, to remain
available without fiscal year limitation.
Subtitle E--Self-Employment Assistance
SEC. 2181. STATE ADMINISTRATION OF SELF-EMPLOYMENT ASSISTANCE PROGRAMS.
(a) Availability for Individuals Receiving Extended
Compensation.--Title II of the Federal-State Extended
Unemployment Compensation Act of 1970 (26 U.S.C. 3304 note) is
amended by inserting at the end the following new section:
``AUTHORITY TO CONDUCT SELF-EMPLOYMENT ASSISTANCE PROGRAMS
``Sec. 208. (a)(1) At the option of a State, for any weeks
of unemployment beginning after the date of enactment of this
section, the State agency of the State may establish a self-
employment assistance program, as described in subsection (b),
to provide for the payment of extended compensation as self-
employment assistance allowances to individuals who would
otherwise satisfy the eligibility criteria under this title.
``(2) Subject to paragraph (3), the self-employment
assistance allowance described in paragraph (1) shall be paid
to an eligible individual from such individual's extended
compensation account, as described in section 202(b), and the
amount in such account shall be reduced accordingly.
``(3)(A) Subject to subparagraph (B), for purposes of self-
employment assistance programs established under this section
and section 4001(j) of the Supplemental Appropriations Act,
2008, an individual shall be provided with self-employment
assistance allowances under such programs for a total of not
greater than 26 weeks (referred to in this section as the
`combined eligibility limit').
``(B) For purposes of an individual who is participating in
a self-employment assistance program established under this
section and has not reached the combined eligibility limit as
of the date on which such individual exhausts all rights to
extended compensation under this title, the individual shall be
eligible to receive self-employment assistance allowances under
a self-employment assistance program established under section
4001(j) of the Supplemental Appropriations Act, 2008, until
such individual has reached the combined eligibility limit,
provided that the individual otherwise satisfies the
eligibility criteria described under title IV of such Act.
``(b) For the purposes of this section, the term `self-
employment assistance program' means a program as defined under
section 3306(t) of the Internal Revenue Code of 1986, except as
follows:
``(1) all references to `regular unemployment
compensation under the State law' shall be deemed to
refer instead to `extended compensation under title II
of the Federal-State Extended Unemployment Compensation
Act of 1970';
``(2) paragraph (3)(B) shall not apply;
``(3) clause (i) of paragraph (3)(C) shall be
deemed to state as follows:
```(i) include any entrepreneurial
training that the State or non-profit
organizations may provide in
coordination with programs of training
offered by the Small Business
Administration, which may include
business counseling, mentorship for
participants, access to small business
development resources, and technical
assistance; and';
``(4) the reference to `5 percent' in paragraph (4)
shall be deemed to refer instead to `1 percent'; and
``(5) paragraph (5) shall not apply.
``(c) In the case of an individual who is eligible to
receive extended compensation under this title, such individual
shall not receive self-employment assistance allowances under
this section unless the State agency has a reasonable
expectation that such individual will be entitled to at least
13 times the individual's average weekly benefit amount of
extended compensation and emergency unemployment compensation.
``(d)(1) An individual who is participating in a self-
employment assistance program established under this section
may elect to discontinue participation in such program at any
time.
``(2) For purposes of an individual whose participation in
a self-employment assistance program established under this
section is terminated pursuant to subsection (a)(3) or who has
discontinued participation in such program, if the individual
continues to satisfy the eligibility requirements for extended
compensation under this title, the individual shall receive
extended compensation payments with respect to subsequent weeks
of unemployment, to the extent that amounts remain in the
account established for such individual under section
202(b).''.
(b) Availability for Individuals Receiving Emergency
Unemployment Compensation.--Section 4001 of the Supplemental
Appropriations Act, 2008 (Public Law 110-252; 26 U.S.C. 3304
note), as amended by sections 2141(b) and 2142(a), is further
amended by inserting at the end the following new subsection:
``(j) Authority to Conduct Self-employment Assistance
Program.--
``(1) In general.--
``(A) Establishment.--Any agreement under
subsection (a) may provide that the State
agency of the State shall establish a self-
employment assistance program, as described in
paragraph (2), to provide for the payment of
emergency unemployment compensation as self-
employment assistance allowances to individuals
who would otherwise satisfy the eligibility
criteria specified in subsection (b).
``(B) Payment of allowances.--Subject to
subparagraph (C), the self-employment
assistance allowance described in subparagraph
(A) shall be paid to an eligible individual
from such individual's emergency unemployment
compensation account, as described in section
4002, and the amount in such account shall be
reduced accordingly.
``(C) Limitation on self-employment
assistance for individuals receiving extended
compensation and emergency unemployment
compensation.--
``(i) Combined eligibility limit.--
Subject to clause (ii), for purposes of
self-employment assistance programs
established under this subsection and
section 208 of the Federal-State
Extended Unemployment Compensation Act
of 1970, an individual shall be
provided with self-employment
assistance allowances under such
programs for a total of not greater
than 26 weeks (referred to in this
subsection as the `combined eligibility
limit').
``(ii) Carryover rule.--For
purposes of an individual who is
participating in a self-employment
assistance program established under
this subsection and has not reached the
combined eligibility limit as of the
date on which such individual exhausts
all rights to extended compensation
under this title, the individual shall
be eligible to receive self-employment
assistance allowances under a self-
employment assistance program
established under section 208 of the
Federal-State Extended Unemployment
Compensation Act of 1970 until such
individual has reached the combined
eligibility limit, provided that the
individual otherwise satisfies the
eligibility criteria described under
title II of such Act.
``(2) Definition of `self-employment assistance
program'.--For the purposes of this section, the term
`self-employment assistance program' means a program as
defined under section 3306(t) of the Internal Revenue
Code of 1986, except as follows:
``(A) all references to `regular
unemployment compensation under the State law'
shall be deemed to refer instead to `emergency
unemployment compensation under title IV of the
Supplemental Appropriations Act, 2008';
``(B) paragraph (3)(B) shall not apply;
``(C) clause (i) of paragraph (3)(C) shall
be deemed to state as follows:
```(i) include any entrepreneurial
training that the State or non-profit
organizations may provide in
coordination with programs of training
offered by the Small Business
Administration, which may include
business counseling, mentorship for
participants, access to small business
development resources, and technical
assistance; and';
``(D) the reference to `5 percent' in
paragraph (4) shall be deemed to refer instead
to `1 percent'; and
``(E) paragraph (5) shall not apply.
``(3) Availability of self-employment assistance
allowances.--In the case of an individual who is
eligible to receive emergency unemployment compensation
payment under this title, such individual shall not
receive self-employment assistance allowances under
this subsection unless the State agency has a
reasonable expectation that such individual will be
entitled to at least 13 times the individual's average
weekly benefit amount of extended compensation and
emergency unemployment compensation.
``(4) Participant option to terminate participation
in self-employment assistance program.--
``(A) Termination.--An individual who is
participating in a self-employment assistance
program established under this subsection may
elect to discontinue participation in such
program at any time.
``(B) Continued eligibility for emergency
unemployment compensation.--For purposes of an
individual whose participation in the self-
employment assistance program established under
this subsection is terminated pursuant to
paragraph (1)(C) or who has discontinued
participation in such program, if the
individual continues to satisfy the eligibility
requirements for emergency unemployment
compensation under this title, the individual
shall receive emergency unemployment
compensation payments with respect to
subsequent weeks of unemployment, to the extent
that amounts remain in the account established
for such individual under section 4002(b) or to
the extent that such individual commences
receiving the amounts described in subsections
(c), (d), or (e) of such section,
respectively.''.
SEC. 2182. GRANTS FOR SELF-EMPLOYMENT ASSISTANCE PROGRAMS.
(a) In General.--
(1) Establishment or improved administration.--
Subject to the requirements established under
subsection (b), the Secretary shall award grants to
States for the purposes of--
(A) improved administration of self-
employment assistance programs that have been
established, prior to the date of the enactment
of this Act, pursuant to section 3306(t) of the
Internal Revenue Code of 1986 (26 U.S.C.
3306(t)), for individuals who are eligible to
receive regular unemployment compensation;
(B) development, implementation, and
administration of self-employment assistance
programs that are established, subsequent to
the date of the enactment of this Act, pursuant
to section 3306(t) of the Internal Revenue Code
of 1986, for individuals who are eligible to
receive regular unemployment compensation; and
(C) development, implementation, and
administration of self-employment assistance
programs that are established pursuant to
section 208 of the Federal-State Extended
Unemployment Compensation Act of 1970 or
section 4001(j) of the Supplemental
Appropriations Act, 2008, for individuals who
are eligible to receive extended compensation
or emergency unemployment compensation.
(2) Promotion and enrollment.--Subject to the
requirements established under subsection (b), the
Secretary shall award additional grants to States that
submit approved applications for a grant under
paragraph (1) for such States to promote self-
employment assistance programs and enroll unemployed
individuals in such programs.
(b) Application and Disbursal.--
(1) Application.--Any State seeking a grant under
paragraph (1) or (2) of subsection (a) shall submit an
application to the Secretary at such time, in such
manner, and containing such information as is
determined appropriate by the Secretary. In no case
shall the Secretary award a grant under this section
with respect to an application that is submitted after
December 31, 2013.
(2) Notice.--Not later than 30 days after receiving
an application described in paragraph (1) from a State,
the Secretary shall notify the State agency as to
whether a grant has been approved for such State for
the purposes described in subsection (a).
(3) Certification.--If the Secretary determines
that a State has met the requirements for a grant under
subsection (a), the Secretary shall make a
certification to that effect to the Secretary of the
Treasury, as well as a certification as to the amount
of the grant payment to be transferred to the State
account in the Unemployment Trust Fund under section
904 of the Social Security Act (42 U.S.C. 1104). The
Secretary of the Treasury shall make the appropriate
transfer to the State account not later than 7 days
after receiving such certification.
(c) Allotment Factors.--For purposes of allotting the funds
available under subsection (d) to States that have met the
requirements for a grant under this section, the amount of the
grant provided to each State shall be determined based upon the
percentage of unemployed individuals in the State relative to
the percentage of unemployed individuals in all States.
(d) Funding.--There are appropriated, out of moneys in the
Treasury not otherwise appropriated, $35,000,000 for the period
of fiscal year 2012 through fiscal year 2013 for purposes of
carrying out the grant program under this section,
SEC. 2183. ASSISTANCE AND GUIDANCE IN IMPLEMENTING SELF-EMPLOYMENT
ASSISTANCE PROGRAMS.
(a) Model Language and Guidance.--For purposes of assisting
States in establishing, improving, and administering self-
employment assistance programs, the Secretary shall--
(1) develop model language that may be used by
States in enacting such programs, as well as
periodically review and revise such model language; and
(2) provide technical assistance and guidance in
establishing, improving, and administering such
programs.
(b) Reporting and Evaluation.--
(1) Reporting.--The Secretary shall establish
reporting requirements for States that have established
self-employment assistance programs, which shall
include reporting on--
(A) the total number of individuals who
received unemployment compensation and--
(i) were referred to a self-
employment assistance program;
(ii) participated in such program;
and
(iii) received an allowance under
such program;
(B) the total amount of allowances provided
to individuals participating in a self-
employment assistance program;
(C) the total income (as determined by
survey or other appropriate method) for
businesses that have been established by
individuals participating in a self-employment
assistance program, as well as the total number
of individuals employed through such
businesses; and
(D) any additional information, as
determined appropriate by the Secretary.
(2) Evaluation.--Not later than 5 years after the
date of the enactment of this Act, the Secretary shall
submit to Congress a report that evaluates the
effectiveness of self-employment assistance programs
established by States, including--
(A) an analysis of the implementation and
operation of self-employment assistance
programs by States;
(B) an evaluation of the economic outcomes
for individuals who participated in a self-
employment assistance program as compared to
individuals who received unemployment
compensation and did not participate in a self-
employment assistance program, including a
comparison as to employment status, income, and
duration of receipt of unemployment
compensation or self-employment assistance
allowances; and
(C) an evaluation of the state of the
businesses started by individuals who
participated in a self-employment assistance
program, including information regarding--
(i) the type of businesses
established;
(ii) the sustainability of the
businesses;
(iii) the total income collected by
the businesses;
(iv) the total number of
individuals employed through such
businesses; and
(v) the estimated Federal and State
tax revenue collected from such
businesses and their employees.
(c) Flexibility and Accountability.--The model language,
guidance, and reporting requirements developed by the Secretary
under subsections (a) and (b) shall--
(1) allow sufficient flexibility for States and
participating individuals; and
(2) ensure accountability and program integrity.
(d) Consultation.--For purposes of developing the model
language, guidance, and reporting requirements described under
subsections (a) and (b), the Secretary shall consult with
employers, labor organizations, State agencies, and other
relevant program experts.
(e) Entrepreneurial Training Programs.--The Secretary shall
utilize resources available through the Department of Labor and
coordinate with the Administrator of the Small Business
Administration to ensure that adequate funding is reserved and
made available for the provision of entrepreneurial training to
individuals participating in self-employment assistance
programs.
(f) Self-employment Assistance Program.--For purposes of
this section, the term ``self-employment assistance program''
means a program established pursuant to section 3306(t) of the
Internal Revenue Code of 1986 (26 U.S.C. 3306(t)), section 208
of the Federal-State Extended Unemployment Compensation Act of
1970, or section 4001(j) of the Supplemental Appropriations
Act, 2008, for individuals who are eligible to receive regular
unemployment compensation, extended compensation, or emergency
unemployment compensation.
SEC. 2184. DEFINITIONS.
In this subtitle:
(1) Secretary.--The term ``Secretary'' means the
Secretary of Labor.
(2) State; state agency.--The terms ``State'' and
``State agency'' have the meanings given such terms
under section 205 of the Federal-State Extended
Unemployment Compensation Act of 1970 (26 U.S.C. 3304
note).
TITLE III--MEDICARE AND OTHER HEALTH PROVISIONS
Subtitle A--Medicare Extensions
SEC. 3001. EXTENSION OF MMA SECTION 508 RECLASSIFICATIONS.
(a) In General.--Section 106(a) of division B of the Tax
Relief and Health Care Act of 2006 (42 U.S.C. 1395 note), as
amended by section 117 of the Medicare, Medicaid, and SCHIP
Extension Act of 2007 (Public Law 110-173), section 124 of the
Medicare Improvements for Patients and Providers Act of 2008
(Public Law 110-275), sections 3137(a) and 10317 of the Patient
Protection and Affordable Care Act (Public Law 111-148),
section 102(a) of the Medicare and Medicaid Extenders Act of
2010 (Public Law 111-309), and section 302(a) of the Temporary
Payroll Tax Cut Continuation Act of 2011 (Public Law 112-78),
is amended by striking ``November 30, 2011'' and inserting
``March 31, 2012''.
(b) Special Rule.--
(1) In general.--Subject to paragraph (2), for
purposes of implementation of the amendment made by
subsection (a), including for purposes of the
implementation of paragraph (2) of section 117(a) of
the Medicare, Medicaid, and SCHIP Extension Act of 2007
(Public Law 110-173), for the period beginning on
December 1, 2011, and ending on March 31, 2012, the
Secretary of Health and Human Services shall use the
hospital wage index that was promulgated by the
Secretary of Health and Human Services in the Federal
Register on August 18, 2011 (76 Fed. Reg. 51476), and
any subsequent corrections.
(2) Exception.--In determining the wage index
applicable to hospitals that qualify for wage index
reclassification, the Secretary shall, for the period
described in paragraph (1), include the average hourly
wage data of hospitals whose reclassification was
extended pursuant to the amendment made by subsection
(a) only if including such data results in a higher
applicable reclassified wage index. Any revision to
hospital wage indexes made as a result of this
paragraph shall not be effected in a budget neutral
manner.
(c) Timeframe for Payments.--
(1) In general.--The Secretary shall make payments
required under subsections (a) and (b) by not later
than June 30, 2012.
(2) October 2011 and november 2011 conforming
change.--Section 302(c) of the Temporary Payroll Tax
Cut Continuation Act of 2011 (Public Law 112-78) is
amended by striking ``December 31, 2012'' and inserting
``June 30, 2012''.
SEC. 3002. EXTENSION OF OUTPATIENT HOLD HARMLESS PAYMENTS.
(a) In General.--Section 1833(t)(7)(D)(i) of the Social
Security Act (42 U.S.C. 1395l(t)(7)(D)(i)), as amended by
section 308 of the Temporary Payroll Tax Cut Continuation Act
of 2011 (Public Law 112-78), is amended--
(1) in subclause (II)--
(A) in the first sentence, by striking
``March 1, 2012'' and inserting ``January 1,
2013''; and
(B) in the second sentence, by striking
``or the first two months of 2012'' and
inserting ``or 2012''; and
(2) in subclause (III), in the first sentence, by
striking ``March 1, 2012'' and inserting ``January 1,
2013''.
(b) Report.--Not later than July 1, 2012, the Secretary of
Health and Human Services shall submit to the Committees on
Ways and Means and Energy and Commerce of the House of
Representatives and the Committee on Finance of the Senate a
report including recommendations for which types of hospitals
should continue to receive hold harmless payments described in
subclauses (II) and (III) of section 1833(t)(7)(D)(i) of the
Social Security Act (42 U.S.C. 1395l(t)(7)(D)(i)) in order to
maintain adequate beneficiary access to outpatient services. In
conducting such report, the Secretary should examine why some
similarly situated hospitals do not receive such hold harmless
payments and are able to rely only on the prospective payment
system for hospital outpatient department services under
section 1833(t) of the Social Security Act (42 U.S.C.
1395l(t)).
SEC. 3003. PHYSICIAN PAYMENT UPDATE.
(a) In General.--Section 1848(d)(13) of the Social Security
Act (42 U.S.C. 1395w-4(d)(13)), as added by section 301 of the
Temporary Payroll Tax Cut Continuation Act of 2011 (Public Law
112-78), is amended--
(1) in the heading, by striking ``first two months
of 2012'' and inserting ``2012'';
(2) in subparagraph (A), by striking ``the period
beginning on January 1, 2012, and ending on February
29, 2012'' and inserting ``2012'';
(3) in the heading of subparagraph (B), by striking
``remaining portion of 2012'' and inserting ``2013'';
and
(4) in subparagraph (B), by striking ``for the
period beginning on March 1, 2012, and ending on
December 31, 2012, and for 2013'' and inserting ``for
2013''.
(b) Mandated Studies on Physician Payment Reform.--
(1) Study by secretary on options for bundled or
episode-based payment.--
(A) In general.--The Secretary of Health
and Human Services shall conduct a study that
examines options for bundled or episode-based
payments, to cover physicians' services
currently paid under the physician fee schedule
under section 1848 of the Social Security Act
(42 U.S.C. 1395w-4), for one or more prevalent
chronic conditions (such as cancer, diabetes,
and congestive heart failure) or episodes of
care for one or more major procedures (such as
medical device implantation). In conducting the
study, the Secretary shall consult with medical
professional societies and other relevant
stakeholders. The study shall include an
examination of related private payer payment
initiatives.
(B) Report.--Not later than January 1,
2013, the Secretary shall submit to the
Committees on Ways and Means and Energy and
Commerce of the House of Representatives and
the Committee on Finance of the Senate a report
on the study conducted under this paragraph.
The Secretary shall include in the report
recommendations on suitable alternative payment
options for services paid under such fee
schedule and on associated implementation
requirements (such as timelines, operational
issues, and interactions with other payment
reform initiatives).
(2) GAO study of private payer initiatives.--
(A) In general.--The Comptroller General of
the United States shall conduct a study that
examines initiatives of private entities
offering or administering health insurance
coverage, group health plans, or other private
health benefit plans to base or adjust
physician payment rates under such coverage or
plans for performance on quality and
efficiency, as well as demonstration of care
delivery improvement activities (such as
adherence to evidence-based guidelines and
patient-shared decision making programs). In
conducting such study, the Comptroller General
shall consult, to the extent appropriate, with
medical professional societies and other
relevant stakeholders.
(B) Report.--Not later than January 1,
2013, the Comptroller General shall submit to
the Committees on Ways and Means and Energy and
Commerce of the House of Representatives and
the Committee on Finance of the Senate a report
on the study conducted under this paragraph.
Such report shall include an assessment of the
applicability of the payer initiatives
described in subparagraph (A) to the Medicare
program and recommendations on modifications to
existing Medicare performance-based
initiatives.
SEC. 3004. WORK GEOGRAPHIC ADJUSTMENT.
(a) In General.--Section 1848(e)(1)(E) of the Social
Security Act (42 U.S.C. 1395w-4(e)(1)(E)), as amended by
section 303 of the Temporary Payroll Tax Cut Continuation Act
of 2011 (Public Law 112-78), is amended by striking ``before
March 1, 2012'' and inserting ``before January 1, 2013''.
(b) Report.--Not later than June 15, 2013, the Medicare
Payment Advisory Commission shall submit to the Committees on
Ways and Means and Energy and Commerce of the House of
Representatives and the Committee on Finance of the Senate a
report that assesses whether any adjustment under section 1848
of the Social Security Act (42 U.S.C. 1395w-4) to distinguish
the difference in work effort by geographic area is appropriate
and, if so, what that level should be and where it should be
applied. The report shall also assess the impact of the work
geographic adjustment under such section, including the extent
to which the floor on such adjustment impacts access to care.
SEC. 3005. PAYMENT FOR OUTPATIENT THERAPY SERVICES.
(a) Application of Additional Requirements.--Section
1833(g)(5) of the Social Security Act (42 U.S.C. 1395l(g)(5)),
as amended by section 304 of the Temporary Payroll Tax Cut
Continuation Act of 2011 (Public Law 112-78), is amended--
(1) by inserting ``(A)'' after ``(5)'';
(2) in the first sentence, by striking ``February
29, 2012'' and inserting ``December 31, 2012'';
(3) in the first sentence, by inserting ``and if
the requirement of subparagraph (B) is met'' after
``medically necessary'';
(4) in the second sentence, by inserting ``made in
accordance with such requirement'' after ``receipt of
the request''; and
(5) by adding at the end the following new
subparagraphs:
``(B) In the case of outpatient therapy services for which
an exception is requested under the first sentence of
subparagraph (A), the claim for such services shall contain an
appropriate modifier (such as the KX modifier used as of the
date of the enactment of this subparagraph) indicating that
such services are medically necessary as justified by
appropriate documentation in the medical record involved.
``(C)(i) In applying this paragraph with respect to a
request for an exception with respect to expenses that would be
incurred for outpatient therapy services (including services
described in subsection (a)(8)(B)) that would exceed the
threshold described in clause (ii) for a year, the request for
such an exception, for services furnished on or after October
1, 2012, shall be subject to a manual medical review process
that is similar to the manual medical review process used for
certain exceptions under this paragraph in 2006.
``(ii) The threshold under this clause for a year is
$3,700. Such threshold shall be applied separately--
``(I) for physical therapy services and speech-
language pathology services; and
``(II) for occupational therapy services.''.
(b) Temporary Application of Therapy Cap to Therapy
Furnished as Part of Hospital Outpatient Services.--Section
1833(g) of such Act (42 U.S.C.1395l(g)) is amended--
(1) in each of paragraphs (1) and (3), by striking
``but not described in section 1833(a)(8)(B)'' and
inserting ``but (except as provided in paragraph (6))
not described in subsection (a)(8)(B)''; and
(2) by adding at the end the following new
paragraph:
``(6) In applying paragraphs (1) and (3) to services
furnished during the period beginning not later than October 1,
2012, and ending on December 31, 2012, the exclusion of
services described in subsection (a)(8)(B) from the uniform
dollar limitation specified in paragraph (2) shall not apply to
such services furnished during 2012.''.
(c) Requirement for Inclusion on Claims of NPI of Physician
Who Reviews Therapy Plan.--Section 1842(t) of such Act (42
U.S.C. 1395u(t)) is amended--
(1) by inserting ``(1)'' after ``(t)''; and
(2) by adding at the end the following new
paragraph:
``(2) Each request for payment, or bill submitted, for
therapy services described in paragraph (1) or (3) of section
1833(g), including services described in section 1833(a)(8)(B),
furnished on or after October 1, 2012, for which payment may be
made under this part shall include the national provider
identifier of the physician who periodically reviews the plan
for such services under section 1861(p)(2).''.
(d) Implementation.--The Secretary of Health and Human
Services shall implement such claims processing edits and issue
such guidance as may be necessary to implement the amendments
made by this section in a timely manner. Notwithstanding any
other provision of law, the Secretary may implement the
amendments made by this section by program instruction. Of the
amount of funds made available to the Secretary for fiscal year
2012 for program management for the Centers for Medicare &
Medicaid Services, not to exceed $9,375,000 shall be available
for such fiscal year and the first 3 months of fiscal year 2013
to carry out section 1833(g)(5)(C) of the Social Security Act
(relating to manual medical review), as added by subsection
(a).
(e) Effective Date.--The requirement of subparagraph (B) of
section 1833(g)(5) of the Social Security Act (42 U.S.C.
1395l(g)(5)), as added by subsection (a), shall apply to
services furnished on or after March 1, 2012.
(f) MedPAC Report on Improved Medicare Therapy Benefits.--
Not later than June 15, 2013, the Medicare Payment Advisory
Commission shall submit to the Committees on Energy and
Commerce and Ways and Means of the House of Representatives and
to the Committee on Finance of the Senate a report making
recommendations on how to improve the outpatient therapy
benefit under part B of title XVIII of the Social Security Act.
The report shall include recommendations on how to reform the
payment system for such outpatient therapy services under such
part so that the benefit is better designed to reflect
individual acuity, condition, and therapy needs of the patient.
Such report shall include an examination of private sector
initiatives relating to outpatient therapy benefits.
(g) Collection of Additional Data.--
(1) Strategy.--The Secretary of Health and Human
Services shall implement, beginning on January 1, 2013,
a claims-based data collection strategy that is
designed to assist in reforming the Medicare payment
system for outpatient therapy services subject to the
limitations of section 1833(g) of the Social Security
Act (42 U.S.C. 1395l(g)). Such strategy shall be
designed to provide for the collection of data on
patient function during the course of therapy services
in order to better understand patient condition and
outcomes.
(2) Consultation.--In proposing and implementing
such strategy, the Secretary shall consult with
relevant stakeholders.
(h) GAO Report on Manual Medical Review Process
Implementation.--Not later than May 1, 2013, the Comptroller
General of the United States shall submit to the Committees on
Energy and Commerce and Ways and Means of the House of
Representatives and to the Committee on Finance of the Senate a
report on the implementation of the manual medical review
process referred to in section 1833(g)(5)(C) of the Social
Security Act, as added by subsection (a). Such report shall
include aggregate data on the number of individuals and claims
subject to such process, the number of reviews conducted under
such process, and the outcome of such reviews.
SEC. 3006. PAYMENT FOR TECHNICAL COMPONENT OF CERTAIN PHYSICIAN
PATHOLOGY SERVICES.
Section 542(c) of the Medicare, Medicaid, and SCHIP
Benefits Improvement and Protection Act of 2000 (as enacted
into law by section 1(a)(6) of Public Law 106-554), as amended
by section 732 of the Medicare Prescription Drug, Improvement,
and Modernization Act of 2003 (42 U.S.C. 1395w-4 note), section
104 of division B of the Tax Relief and Health Care Act of 2006
(42 U.S.C. 1395w-4 note), section 104 of the Medicare,
Medicaid, and SCHIP Extension Act of 2007 (Public Law 110-173),
section 136 of the Medicare Improvements for Patients and
Providers Act of 2008 (Public Law 110-275), section 3104 of the
Patient Protection and Affordable Care Act (Public Law 111-
148), section 105 of the Medicare and Medicaid Extenders Act of
2010 (Public Law 111-309), and section 305 of the Temporary
Payroll Tax Cut Continuation Act of 2011 (Public Law 112-78),
is amended by striking ``and the first two months of 2012'' and
inserting ``and the first six months of 2012''.
SEC. 3007. AMBULANCE ADD-ON PAYMENTS.
(a) Ground Ambulance.--Section 1834(l)(13)(A) of the Social
Security Act (42 U.S.C. 1395m(l)(13)(A)), as amended by section
306(a) of the Temporary Payroll Tax Cut Continuation Act of
2011 (Public Law 112-78), is amended--
(1) in the matter preceding clause (i), by striking
``March 1, 2012'' and inserting ``January 1, 2013'';
and
(2) in each of clauses (i) and (ii), by striking
``March 1, 2012'' and inserting ``January 1, 2013''
each place it appears.
(b) Air Ambulance.--Section 146(b)(1) of the Medicare
Improvements for Patients and Providers Act of 2008 (Public Law
110-275), as amended by sections 3105(b) and 10311(b) of the
Patient Protection and Affordable Care Act (Public Law 111-
148), section 106(b) of the Medicare and Medicaid Extenders Act
of 2010 (Public Law 111-309) and section 306(b) of the
Temporary Payroll Tax Cut Continuation Act of 2011 (Public Law
112-78), is amended by striking ``February 29, 2012'' and
inserting ``December 31, 2012''.
(c) Super Rural Ambulance.--Section 1834(l)(12)(A) of the
Social Security Act (42 U.S.C. 1395m(l)(12)(A)), as amended by
section 306(c) of Temporary Payroll Tax Cut Continuation Act of
2011 (Public Law 112-78), is amended in the first sentence by
striking ``March 1, 2012'' and inserting ``January 1, 2013''.
(d) GAO Report Update.--Not later than October 1, 2012, the
Comptroller General of the United States shall update the GAO
report GAO-07-383 (relating to Ambulance Providers: Costs and
Expected Medicare Margins Vary Greatly) to reflect current
costs for ambulance providers.
(e) MedPAC Report.--The Medicare Payment Advisory
Commission shall conduct a study of--
(1) the appropriateness of the add-on payments for
ambulance providers under paragraphs (12)(A) and
(13)(A) of section 1834(l) of the Social Security Act
(42 U.S.C. 1395m(l)) and the treatment of air ambulance
providers under section 146(b)(1) of the Medicare
Improvements for Patients and Providers Act of 2008
(Public Law 110-275);
(2) the effect these add-on payments and such
treatment have on the Medicare margins of ambulance
providers; and
(3) whether there is a need to reform the Medicare
ambulance fee schedule under such section and, if so,
what should such reforms be, including whether the add-
on payments should be included in the base rate.
Not later than June 15, 2013, the Commission shall submit to
the Committees on Ways and Means and Energy and Commerce of the
House of Representatives and the Committee on Finance of the
Senate a report on such study and shall include in the report
such recommendations as the Commission deems appropriate.
Subtitle B--Other Health Provisions
SEC. 3101. QUALIFYING INDIVIDUAL PROGRAM.
(a) Extension.--Section 1902(a)(10)(E)(iv) of the Social
Security Act (42 U.S.C. 1396a(a)(10)(E)(iv)), as amended by
section 310(a) of the Temporary Payroll Tax Cut Continuation
Act of 2011 (Public Law 112-78), is amended by striking
``February'' and inserting ``December''.
(b) Extending Total Amount Available for Allocation.--
Section 1933(g) of such Act (42 U.S.C. 1396u-3(g)), as amended
by section 310(b) of the Temporary Payroll Tax Cut Continuation
Act of 2011 (Public Law 112-78), is amended--
(1) in paragraph (2)--
(A) in subparagraph (P), by striking
``and'' after the semicolon;
(B) in subparagraph (Q), by striking
``February 29, 2012, the total allocation
amount is $150,000,000.'' and inserting
``September 30, 2012, the total allocation
amount is $450,000,000; and''; and
(C) by adding at the end the following new
subparagraph:
``(R) for the period that begins on October
1, 2012, and ends on December 31, 2012, the
total allocation amount is $280,000,000.''; and
(2) in paragraph (3), in the matter preceding
subparagraph (A), by striking ``or (P)'' and inserting
``(P), or (R)''.
SEC. 3102. TRANSITIONAL MEDICAL ASSISTANCE.
Sections 1902(e)(1)(B) and 1925(f) of the Social Security
Act (42 U.S.C. 1396a(e)(1)(B), 1396r-6(f)), as amended by
section 311 of the Temporary Payroll Tax Cut Continuation Act
of 2011 (Public Law 112-78), are each amended by striking
``February 29'' and inserting ``December 31''.
Subtitle C--Health Offsets
SEC. 3201. REDUCTION OF BAD DEBT TREATED AS AN ALLOWABLE COST.
(a) Hospitals.--Section 1861(v)(1)(T) of the Social
Security Act (42 U.S.C. 1395x(v)(1)(T)) is amended--
(1) in clause (iii), by striking ``and'' at the
end;
(2) in clause (iv)--
(A) by striking ``a subsequent fiscal
year'' and inserting ``fiscal years 2001
through 2012''; and
(B) by striking the period at the end and
inserting ``, and''; and
(3) by adding at the end the following:
``(v) for cost reporting periods beginning during
fiscal year 2013 or a subsequent fiscal year, by 35
percent of such amount otherwise allowable.''.
(b) Skilled Nursing Facilities.--Section 1861(v)(1)(V) of
such Act (42 U.S.C. 1395x(v)(1)(V)) is amended--
(1) in the matter preceding clause (i), by striking
``with respect to cost reporting periods beginning on
or after October 1, 2005'' and inserting ``and
(beginning with respect to cost reporting periods
beginning during fiscal year 2013) for covered skilled
nursing services described in section 1888(e)(2)(A)
furnished by hospital providers of extended care
services (as described in section 1883)'';
(2) in clause (i), by striking ``reduced by'' and
all that follows through ``allowable; and'' and
inserting the following: ``reduced by--
``(I) for cost reporting periods beginning on or
after October 1, 2005, but before fiscal year 2013, 30
percent of such amount otherwise allowable; and
``(II) for cost reporting periods beginning during
fiscal year 2013 or a subsequent fiscal year, by 35
percent of such amount otherwise allowable.''; and
(3) in clause (ii), by striking ``such section
shall not be reduced.'' and inserting ``such section--
``(I) for cost reporting periods beginning on or
after October 1, 2005, but before fiscal year 2013,
shall not be reduced;
``(II) for cost reporting periods beginning during
fiscal year 2013, shall be reduced by 12 percent of
such amount otherwise allowable;
``(III) for cost reporting periods beginning during
fiscal year 2014, shall be reduced by 24 percent of
such amount otherwise allowable; and
``(IV) for cost reporting periods beginning during
a subsequent fiscal year, shall be reduced by 35
percent of such amount otherwise allowable.''.
(c) Certain Other Providers.--Section 1861(v)(1) of such
Act (42 U.S.C. 1395x(v)(1)) is amended by adding at the end the
following new subparagraph:
``(W)(i) In determining such reasonable costs for providers
described in clause (ii), the amount of bad debts otherwise
treated as allowable costs which are attributable to
deductibles and coinsurance amounts under this title shall be
reduced--
``(I) for cost reporting periods beginning during
fiscal year 2013, by 12 percent of such amount
otherwise allowable;
``(II) for cost reporting periods beginning during
fiscal year 2014, by 24 percent of such amount
otherwise allowable; and
``(III) for cost reporting periods beginning during
a subsequent fiscal year, by 35 percent of such amount
otherwise allowable.
``(ii) A provider described in this clause is a provider of
services not described in subparagraph (T) or (V), a supplier,
or any other type of entity that receives payment for bad debts
under the authority under subparagraph (A).''.
(d) Conforming Amendment for Hospital Services.--Section
4008(c) of the Omnibus Budget Reconciliation Act of 1987 (42
U.S.C. 1395 note), as amended by section 8402 of the Technical
and Miscellaneous Revenue Act of 1988 and section 6023 of the
Omnibus Budget Reconciliation Act of 1989, is amended by adding
at the end the following new sentence: ``Effective for cost
reporting periods beginning on or after October 1, 2012, the
provisions of the previous two sentences shall not apply.''.
SEC. 3202. REBASE MEDICARE CLINICAL LABORATORY PAYMENT RATES.
Section 1833(h)(2)(A) of the Social Security Act (42 U.S.C.
1395l(h)(2)(A)) is amended--
(1) in clause (i), by striking ``paragraph (4)''
and inserting ``clause (v), subparagraph (B), and
paragraph (4)'';
(2) by moving clause (iv), subclauses (I) and (II)
of such clause, and the flush matter at the end of such
clause 6 ems to the left; and
(3) by adding at the end the following new clause:
``(v) The Secretary shall reduce by 2 percent the fee
schedules otherwise determined under clause (i) for 2013, and
such reduced fee schedules shall serve as the base for 2014 and
subsequent years.''.
SEC. 3203. REBASING STATE DSH ALLOTMENTS FOR FISCAL YEAR 2021.
Section 1923(f) of the Social Security Act (42 U.S.C.
1396r-4(f)) is amended--
(1) by redesignating paragraph (8) as paragraph
(9);
(2) in paragraph (3)(A) by striking ``paragraphs
(6) and (7)'' and inserting ``paragraphs (6), (7), and
(8)''; and
(3) by inserting after paragraph (7) the following
new paragraph:
``(8) Rebasing of state dsh allotments for fiscal
year 2021.--With respect to fiscal year 2021, for
purposes of applying paragraph (3)(A) to determine the
DSH allotment for a State, the amount of the DSH
allotment for the State under paragraph (3) for fiscal
year 2020 shall be equal to the DSH allotment as
reduced under paragraph (7).''.
SEC. 3204. TECHNICAL CORRECTION TO THE DISASTER RECOVERY FMAP
PROVISION.
(a) In General.--Section 1905(aa) of the Social Security
Act (42 U.S.C. 1396d(aa)) is amended--
(1) in paragraph (1)--
(A) in subparagraph (A), by striking ``the
Federal medical assistance percentage
determined for the fiscal year'' and all that
follows through the period and inserting ``the
State's regular FMAP shall be increased by 50
percent of the number of percentage points by
which the State's regular FMAP for such fiscal
year is less than the Federal medical
assistance percentage determined for the State
for the preceding fiscal year after the
application of only subsection (a) of section
5001 of Public Law 111-5 (if applicable to the
preceding fiscal year) and without regard to
this subsection, subsections (y) and (z), and
subsections (b) and (c) of section 5001 of
Public Law 111-5.''; and
(B) in subparagraph (B), by striking
``Federal medical assistance percentage
determined for the preceding fiscal year'' and
all that follows through the period and
inserting ``State's regular FMAP for such
fiscal year shall be increased by 25 percent of
the number of percentage points by which the
State's regular FMAP for such fiscal year is
less than the Federal medical assistance
percentage received by the State during the
preceding fiscal year.'';
(2) in paragraph (2)--
(A) in subparagraph (A)--
(i) by striking ``Federal medical
assistance percentage determined for
the State for the fiscal year'' and all
that follows through ``Act,'' and
inserting ``State's regular FMAP for
the fiscal year''; and
(ii) by striking ``subsection (y)''
and inserting ``subsections (y) and
(z)''; and
(B) in subparagraph (B), by striking
``Federal medical assistance percentage
determined for the State for the fiscal year''
and all that follows through ``Act,'' and
inserting ``State's regular FMAP for the fiscal
year'';
(3) by redesignating paragraph (3) as paragraph
(4); and
(4) by inserting after paragraph (2) the following:
``(3) In this subsection, the term `regular FMAP' means,
for each fiscal year for which this subsection applies to a
State, the Federal medical assistance percentage that would
otherwise apply to the State for the fiscal year, as determined
under subsection (b) and without regard to this subsection,
subsections (y) and (z), and section 10202 of the Patient
Protection and Affordable Care Act.''.
(b) Effective Date.--The amendments made by subsection (a)
shall take effect on October 1, 2013.
SEC. 3205. PREVENTION AND PUBLIC HEALTH FUND.
Section 4002(b) of the Patient Protection and Affordable
Care Act (42 U.S.C. 300u-11(b)) is amended by striking
paragraphs (2) through (6) and inserting the following:
``(2) for each of fiscal years 2012 through 2017,
$1,000,000,000;
``(3) for each of fiscal years 2018 and 2019,
$1,250,000,000;
``(4) for each of fiscal years 2020 and 2021,
$1,500,000,000; and
``(5) for fiscal year 2022, and each fiscal year
thereafter, $2,000,000,000.''.
TITLE IV--TANF EXTENSION
SEC. 4001. SHORT TITLE.
This title may be cited as the ``Welfare Integrity and Data
Improvement Act''.
SEC. 4002. EXTENSION OF PROGRAM.
(a) Family Assistance Grants.--Section 403(a)(1) of the
Social Security Act (42 U.S.C. 603(a)(1)) is amended--
(1) in subparagraph (A), by striking ``each of
fiscal years 1996'' and all that follows through
``2003'' and inserting ``fiscal year 2012'';
(2) in subparagraph (B)--
(A) by inserting ``(as in effect just
before the enactment of the Welfare Integrity
and Data Improvement Act)'' after ``this
paragraph'' the 1st place it appears; and
(B) by inserting ``(as so in effect)''
after ``this paragraph'' the 2nd place it
appears; and
(3) in subparagraph (C), by striking ``2003'' and
inserting ``2012''.
(b) Healthy Marriage Promotion and Responsible Fatherhood
Grants.--Section 403(a)(2)(D) of such Act (42 U.S.C.
603(a)(2)(D)) is amended by striking ``2011'' each place it
appears and inserting ``2012''.
(c) Maintenance of Effort Requirement.--Section 409(a)(7)
of such Act (42 U.S.C. 609(a)(7)) is amended--
(1) in subparagraph (A), by striking ``fiscal
year'' and all that follows through ``2013'' and
inserting ``a fiscal year''; and
(2) in subparagraph (B)(ii)--
(A) by striking ``for fiscal years 1997
through 2012,''; and
(B) by striking ``407(a) for the fiscal
year,'' and inserting ``407(a),''.
(d) Tribal Grants.--Section 412(a) of such Act (42 U.S.C.
612(a)) is amended in each of paragraphs (1)(A) and (2)(A) by
striking ``each of fiscal years 1997'' and all that follows
through ``2003'' and inserting ``fiscal year 2012''.
(e) Studies and Demonstrations.--Section 413(h)(1) of such
Act (42 U.S.C. 613(h)(1)) is amended by striking ``each of
fiscal years 1997 through 2002'' and inserting ``fiscal year
2012''.
(f) Census Bureau Study.--Section 414(b) of such Act (42
U.S.C. 614(b)) is amended by striking ``each of fiscal years
1996'' and all that follows through ``2003'' and inserting
``fiscal year 2012''.
(g) Child Care Entitlement.--Section 418(a)(3) of such Act
(42 U.S.C. 618(a)(3)) is amended by striking ``appropriated''
and all that follows and inserting ``appropriated
$2,917,000,000 for fiscal year 2012.''.
(h) Grants to Territories.--Section 1108(b)(2) of such Act
(42 U.S.C. 1308(b)(2)) is amended by striking ``fiscal years
1997 through 2003'' and inserting ``fiscal year 2012''.
(i) Prevention of Duplicate Appropriations for Fiscal Year
2012.--Expenditures made pursuant to the Short-Term TANF
Extension Act (Public Law 112-35) and the Temporary Payroll Tax
Cut Continuation Act of 2011 (Public Law 112-78) for fiscal
year 2012 shall be charged to the applicable appropriation or
authorization provided by the amendments made by this section
for such fiscal year.
(j) Effective Date.--This section and the amendments made
by this section shall take effect on the date of the enactment
of this Act.
SEC. 4003. DATA EXCHANGE STANDARDIZATION FOR IMPROVED INTEROPERABILITY.
(a) In General.--Section 411 of the Social Security Act (42
U.S.C. 611) is amended by adding at the end the following:
``(d) Data Exchange Standardization for Improved
Interoperability.--
``(1) Data exchange standards.--
``(A) Designation.--The Secretary, in
consultation with an interagency work group
which shall be established by the Office of
Management and Budget, and considering State
and tribal perspectives, shall, by rule,
designate a data exchange standard for any
category of information required to be reported
under this part.
``(B) Data exchange standards must be
nonproprietary and interoperable.--The data
exchange standard designated under subparagraph
(A) shall, to the extent practicable, be
nonproprietary and interoperable.
``(C) Other requirements.--In designating
data exchange standards under this section, the
Secretary shall, to the extent practicable,
incorporate--
``(i) 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;
``(ii) interoperable standards
developed and maintained by
intergovernmental partnerships, such as
the National Information Exchange
Model; and
``(iii) interoperable standards
developed and maintained by Federal
entities with authority over
contracting and financial assistance,
such as the Federal Acquisition
Regulatory Council.
``(2) Data exchange standards for reporting.--
``(A) Designation.--The Secretary, in
consultation with an interagency work group
established by the Office of Management and
Budget, and considering State and tribal
perspectives, shall, by rule, designate data
exchange standards to govern the data reporting
required under this part.
``(B) Requirements.--The data exchange
standards required by subparagraph (A) shall,
to the extent practicable--
``(i) incorporate a widely-
accepted, nonproprietary, searchable,
computer-readable format;
``(ii) be consistent with and
implement applicable accounting
principles; and
``(iii) be capable of being
continually upgraded as necessary.
``(C) Incorporation of nonproprietary
standards.--In designating reporting standards
under this paragraph, the Secretary shall, to
the extent practicable, incorporate existing
nonproprietary standards, such as the
eXtensible Markup Language.''.
(b) Effective Dates.--
(1) Data exchange standards.--The Secretary of
Health and Human Services shall issue a proposed rule
under section 411(d)(1) of the Social Security Act
within 12 months after the date of the enactment of
this section, and shall issue a final rule under such
section 411(d)(1), after public comment, within 24
months after such date of enactment.
(2) Data reporting standards.--The reporting
standards required under section 411(d)(2) of such Act
shall become effective with respect to reports required
in the first reporting period, after the effective date
of the final rule referred to in paragraph (1) of this
subsection, for which the authority for data collection
and reporting is established or renewed under the
Paperwork Reduction Act.
SEC. 4004. SPENDING POLICIES FOR ASSISTANCE UNDER STATE TANF PROGRAMS.
(a) State Requirement.--Section 408(a) of the Social
Security Act (42 U.S.C. 608(a)) is amended by adding at the end
the following:
``(12) State requirement to prevent unauthorized
spending of benefits.--
``(A) In general.--A State to which a grant
is made under section 403 shall maintain
policies and practices as necessary to prevent
assistance provided under the State program
funded under this part from being used in any
electronic benefit transfer transaction in--
``(i) any liquor store;
``(ii) any casino, gambling casino,
or gaming establishment; or
``(iii) any retail establishment
which provides adult-oriented
entertainment in which performers
disrobe or perform in an unclothed
state for entertainment.
``(B) Definitions.--For purposes of
subparagraph (A)--
``(i) Liquor store.--The term
`liquor store' means any retail
establishment which sells exclusively
or primarily intoxicating liquor. Such
term does not include a grocery store
which sells both intoxicating liquor
and groceries including staple foods
(within the meaning of section 3(r) of
the Food and Nutrition Act of 2008 (7
U.S.C. 2012(r))).
``(ii) Casino, gambling casino, or
gaming establishment.--The terms
`casino', `gambling casino', and
`gaming establishment' do not include--
``(I) a grocery store which
sells groceries including such
staple foods and which also
offers, or is located within
the same building or complex
as, casino, gambling, or gaming
activities; or
``(II) any other
establishment that offers
casino, gambling, or gaming
activities incidental to the
principal purpose of the
business.
``(iii) Electronic benefit transfer
transaction.--The term `electronic
benefit transfer transaction' means the
use of a credit or debit card service,
automated teller machine, point-of-sale
terminal, or access to an online system
for the withdrawal of funds or the
processing of a payment for merchandise
or a service.''.
(b) Penalty.--Section 409(a) of such Act (42 U.S.C. 609(a))
is amended by adding at the end the following:
``(16) Penalty for failure to enforce spending
policies.--
``(A) In general.--If, within 2 years after
the date of the enactment of this paragraph,
any State has not reported to the Secretary on
such State's implementation of the policies and
practices required by section 408(a)(12), or
the Secretary determines, based on the
information provided in State reports, that any
State has not implemented and maintained such
policies and practices, the Secretary shall
reduce, by an amount equal to 5 percent of the
State family assistance grant, the grant
payable to such State under section 403(a)(1)
for--
``(i) the fiscal year immediately
succeeding the year in which such 2-
year period ends; and
``(ii) each succeeding fiscal year
in which the State does not demonstrate
that such State has implemented and
maintained such policies and practices.
``(B) Reduction of applicable penalty.--The
Secretary may reduce the amount of the
reduction required under subparagraph (A) based
on the degree of noncompliance of the State.
``(C) State not responsible for individual
violations.--Fraudulent activity by any
individual in an attempt to circumvent the
policies and practices required by section
408(a)(12) shall not trigger a State penalty
under subparagraph (A).''.
(c) Additional State Plan Requirements.--Section
402(a)(1)(A) of such Act (42 U.S.C. 602(a)(1)(A)) is amended by
adding at the end the following:
``(vii) Implement policies and
procedures as necessary to prevent
access to assistance provided under the
State program funded under this part
through any electronic fund transaction
in an automated teller machine or
point-of-sale device located in a place
described in section 408(a)(12),
including a plan to ensure that
recipients of the assistance have
adequate access to their cash
assistance.
``(viii) Ensure that recipients of
assistance provided under the State
program funded under this part have
access to using or withdrawing
assistance with minimal fees or
charges, including an opportunity to
access assistance with no fee or
charges, and are provided information
on applicable fees and surcharges that
apply to electronic fund transactions
involving the assistance, and that such
information is made publicly
available.''.
(d) Conforming Amendment.--Section 409(c)(4) of such Act
(42 U.S.C. 609(c)(4)) is amended by striking ``or (13)'' and
inserting ``(13), or (16)''.
SEC. 4005. TECHNICAL CORRECTIONS.
(a) Section 404(d)(1)(A) of the Social Security Act (42
U.S.C. 604(d)(1)(A)) is amended by striking ``subtitle 1 of
Title'' and inserting ``Subtitle A of title''.
(b) Sections 407(c)(2)(A)(i) and 409(a)(3)(C) of such Act
(42 U.S.C. 607(c)(2)(A)(i) and 609(a)(3)(C)) are each amended
by striking ``403(b)(6)'' and inserting ``403(b)(5)''.
(c) Section 409(a)(2)(A) of such Act (42 U.S.C.
609(a)(2)(A)) is amended by moving clauses (i) and (ii) 2 ems
to the right.
(d) Section 409(c)(2) of such Act (42 U.S.C. 609(c)(2)) is
amended by inserting a comma after ``appropriate''.
(e) Section 411(a)(1)(A)(ii)(III) of such Act (42 U.S.C.
611(a)(1)(A)(ii)(III)) is amended by striking the last close
parenthesis.
TITLE V--FEDERAL EMPLOYEES RETIREMENT
SEC. 5001. INCREASE IN CONTRIBUTIONS TO FEDERAL EMPLOYEES' RETIREMENT
SYSTEM FOR NEW EMPLOYEES.
(a) Definitions.--Section 8401 of title 5, United States
Code, is amended--
(1) in paragraph (35), by striking ``and'' at the
end;
(2) in paragraph (36), by striking the period and
inserting ``; and''; and
(3) by adding at the end the following:
``(37) the term `revised annuity employee' means
any individual who--
``(A) on December 31, 2012--
``(i) is not an employee or Member
covered under this chapter;
``(ii) is not performing civilian
service which is creditable service
under section 8411; and
``(iii) has less than 5 years of
creditable civilian service under
section 8411; and
``(B) after December 31, 2012, becomes
employed as an employee or becomes a Member
covered under this chapter performing service
which is creditable service under section
8411.''.
(b) Increase in Contributions.--Section 8422(a)(3) of title
5, United States Code, is amended--
(1) by striking ``The applicable percentage under
this paragraph for civilian service'' and inserting
``(A) The applicable percentage under this paragraph
for civilian service by employees or Members other than
revised annuity employees''; and
(2) by adding at the end the following:
``(B) The applicable percentage under this paragraph for
civilian service by revised annuity employees shall be as
follows:
------------------------------------------------------------------------
------------------------------------------------------------------------
``Employee 9.3 After December 31,
2012.
Congressional employee 9.3 After December 31,
2012.
Member 9.3 After December 31,
2012.
Law enforcement officer, 9.8 After December 31,
firefighter, member of the 2012.
Capitol Police, member of the
Supreme Court Police, or air
traffic controller
Nuclear materials courier 9.8 After December 31,
2012.
Customs and border protection 9.8 After December 31,
officer 2012.''.
------------------------------------------------------------------------
(c) Reduction in Congressional Annuities.--
(1) In general.--Section 8415 of title 5, United
States Code, is amended--
(A) by redesignating subsections (d)
through (m) as subsections (e) through (n),
respectively; and
(B) by inserting after subsection (c) the
following:
``(d) Notwithstanding any other provision of law, the
annuity of an individual described in subsection (b) or (c) who
is a revised annuity employee shall be computed in the same
manner as in the case of an individual described in subsection
(a).''.
(2) Technical and conforming amendments.--
(A) Section 8422(d)(2) of title 5, United
States Code, is amended by striking ``section
8415(l)'' and inserting ``section 8415(m)''.
(B) Section 8452(d)(1) of title 5, United
States Code, is amended by striking
``subsection (g)'' and inserting ``subsection
(h)''.
(C) Section 8468(b)(1)(A) of title 5,
United States Code, is amended by striking
``section 8415(a) through (h)'' and inserting
``section 8415(a) through (i)''.
(D) Section 805(a)(2)(B) of the Foreign
Service Act of 1980 (22 U.S.C. 4045(a)(2)(B))
is amended by striking ``section 8415(d)'' and
inserting ``section 8415(e)''.
(E) Section 806(a) of the Foreign Service
Act of 1980 (22 U.S.C. 4046(a)) is amended by
striking ``section 8415(d)'' each place it
appears and inserting ``section 8415(e)''.
(F) Section 855(b) of the Foreign Service
Act of 1980 (22 U.S.C. 4071d(b)) is amended--
(i) in paragraph (2)(A), by
striking ``section 8415(d)(1)'' and
inserting ``section 8415(e)(1)''; and
(ii) in paragraph (5), by striking
``section 8415(f)(1)'' and inserting
``section 8415(g)(1)''.
(G) Section 303(b)(1) of the Central
Intelligence Agency Retirement Act (50 U.S.C.
2153(b)(1)) is amended by striking ``section
8415(d)'' and inserting ``section 8415(e)''.
SEC. 5002. FOREIGN SERVICE PENSION SYSTEM.
(a) Definition.--Section 852 of the Foreign Service Act of
1980 (22 U.S.C. 4071a) is amended--
(1) by redesignating paragraphs (7), (8), and (9)
as paragraphs (8), (9), and (10), respectively; and
(2) by inserting after paragraph (6) the following:
``(7) the term `revised annuity participant' means
any individual who--
``(A) on December 31, 2012--
``(i) is not a participant;
``(ii) is not performing service
which is creditable service under
section 854; and
``(iii) has less than 5 years
creditable service under section 854;
and
``(B) after December 31, 2012, becomes a
participant performing service which is
creditable service under section 854;''.
(b) Deductions and Withholdings From Pay.--Section
856(a)(2) of the Foreign Service Act of 1980 (22 U.S.C.
4071e(a)(2)) is amended--
(1) by striking ``The applicable percentage under
this subsection'' and inserting ``(A) The applicable
percentage for a participant other than a revised
annuity participant''; and
(2) by adding at the end the following:
``(B) The applicable percentage for a revised annuity
participant shall be as follows:
``9.85.......................... After December 31, 2012''.
SEC. 5003. CENTRAL INTELLIGENCE AGENCY RETIREMENT AND DISABILITY
SYSTEM.
Section 211(a) of the Central Intelligence Agency
Retirement Act (50 U.S.C. 2021(a)) is amended--
(1) by redesignating paragraph (3) as paragraph
(4); and
(2) by striking paragraphs (1) and (2) and
inserting the following:
``(1) Definition.--In this subsection, the term
`revised annuity participant' means an individual who--
``(A) on December 31, 2012--
``(i) is not a participant;
``(ii) is not performing qualifying
service; and
``(iii) has less than 5 years of
qualifying service; and
``(B) after December 31, 2012, becomes a
participant performing qualifying service.
``(2) Contributions.--
``(A) In general.--Except as provided in
subsection (d), 7 percent of the basic pay
received by a participant other than a revised
annuity participant for any pay period shall be
deducted and withheld from the pay of that
participant and contributed to the fund.
``(B) Revised annuity participants.--Except
as provided in subsection (d), 9.3 percent of
the basic pay received by a revised annuity
participant for any pay period shall be
deducted and withheld from the pay of that
revised annuity participant and contributed to
the fund.
``(3) Agency contributions.--
``(A) In general.--An amount equal to 7
percent of the basic pay received by a
participant other than a revised annuity
participant shall be contributed to the fund
for a pay period for the participant from the
appropriation or fund which is used for payment
of the participant's basic pay.
``(B) Revised annuity participants.--An
amount equal to 4.7 percent of the basic pay
received by a revised annuity participant shall
be contributed to the fund for a pay period for
the revised annuity participant from the
appropriation or fund which is used for payment
of the revised annuity participant's basic
pay.''.
TITLE VI--PUBLIC SAFETY COMMUNICATIONS AND ELECTROMAGNETIC SPECTRUM
AUCTIONS
SEC. 6001. DEFINITIONS.
In this title:
(1) 700 mhz band.--The term ``700 MHz band'' means
the portion of the electromagnetic spectrum between the
frequencies from 698 megahertz to 806 megahertz.
(2) 700 mhz d block spectrum.--The term ``700 MHz D
block spectrum'' means the portion of the
electromagnetic spectrum between the frequencies from
758 megahertz to 763 megahertz and between the
frequencies from 788 megahertz to 793 megahertz.
(3) Appropriate committees of congress.--Except as
otherwise specifically provided, the term ``appropriate
committees of Congress'' means--
(A) the Committee on Commerce, Science, and
Transportation of the Senate; and
(B) the Committee on Energy and Commerce of
the House of Representatives.
(4) Assistant secretary.--The term ``Assistant
Secretary'' means the Assistant Secretary of Commerce
for Communications and Information.
(5) Board.--The term ``Board'' means the Board of
the First Responder Network Authority established under
section 6204(b).
(6) Broadcast television licensee.--The term
``broadcast television licensee'' means the licensee
of--
(A) a full-power television station; or
(B) a low-power television station that has
been accorded primary status as a Class A
television licensee under section 73.6001(a) of
title 47, Code of Federal Regulations.
(7) Broadcast television spectrum.--The term
``broadcast television spectrum'' means the portions of
the electromagnetic spectrum between the frequencies
from 54 megahertz to 72 megahertz, from 76 megahertz to
88 megahertz, from 174 megahertz to 216 megahertz, and
from 470 megahertz to 698 megahertz.
(8) Commercial mobile data service.--The term
``commercial mobile data service'' means any mobile
service (as defined in section 3 of the Communications
Act of 1934 (47 U.S.C. 153)) that is--
(A) a data service;
(B) provided for profit; and
(C) available to the public or such classes
of eligible users as to be effectively
available to a substantial portion of the
public, as specified by regulation by the
Commission.
(9) Commercial mobile service.--The term
``commercial mobile service'' has the meaning given
such term in section 332 of the Communications Act of
1934 (47 U.S.C. 332).
(10) Commercial standards.--The term ``commercial
standards'' means the technical standards followed by
the commercial mobile service and commercial mobile
data service industries for network, device, and
Internet Protocol connectivity. Such term includes
standards developed by the Third Generation Partnership
Project (3GPP), the Institute of Electrical and
Electronics Engineers (IEEE), the Alliance for
Telecommunications Industry Solutions (ATIS), the
Internet Engineering Task Force (IETF), and the
International Telecommunication Union (ITU).
(11) Commission.--The term ``Commission'' means the
Federal Communications Commission.
(12) Core network.--The term ``core network'' means
the core network described in section 6202(b)(1).
(13) Emergency call.--The term ``emergency call''
means any real-time communication with a public safety
answering point or other emergency management or
response agency, including--
(A) through voice, text, or video and
related data; and
(B) nonhuman-initiated automatic event
alerts, such as alarms, telematics, or sensor
data, which may also include real-time voice,
text, or video communications.
(14) Existing public safety broadband spectrum.--
The term ``existing public safety broadband spectrum''
means the portion of the electromagnetic spectrum
between the frequencies--
(A) from 763 megahertz to 768 megahertz;
(B) from 793 megahertz to 798 megahertz;
(C) from 768 megahertz to 769 megahertz;
and
(D) from 798 megahertz to 799 megahertz.
(15) First responder network authority.--The term
``First Responder Network Authority'' means the First
Responder Network Authority established under section
6204.
(16) Forward auction.--The term ``forward auction''
means the portion of an incentive auction of broadcast
television spectrum under section 6403(c).
(17) Incentive auction.--The term ``incentive
auction'' means a system of competitive bidding under
subparagraph (G) of section 309(j)(8) of the
Communications Act of 1934, as added by section 6402.
(18) Interoperability board.--The term
``Interoperability Board'' means the Technical Advisory
Board for First Responder Interoperability established
under section 6203.
(19) Multichannel video programming distributor.--
The term ``multichannel video programming distributor''
has the meaning given such term in section 602 of the
Communications Act of 1934 (47 U.S.C. 522).
(20) Narrowband spectrum.--The term ``narrowband
spectrum'' means the portion of the electromagnetic
spectrum between the frequencies from 769 megahertz to
775 megahertz and between the frequencies from 799
megahertz to 805 megahertz.
(21) Nationwide public safety broadband network.--
The term ``nationwide public safety broadband network''
means the nationwide, interoperable public safety
broadband network described in section 6202.
(22) Next generation 9-1-1 services.--The term
``Next Generation 9-1-1 services'' means an IP-based
system comprised of hardware, software, data, and
operational policies and procedures that--
(A) provides standardized interfaces from
emergency call and message services to support
emergency communications;
(B) processes all types of emergency calls,
including voice, text, data, and multimedia
information;
(C) acquires and integrates additional
emergency call data useful to call routing and
handling;
(D) delivers the emergency calls, messages,
and data to the appropriate public safety
answering point and other appropriate emergency
entities;
(E) supports data or video communications
needs for coordinated incident response and
management; and
(F) provides broadband service to public
safety answering points or other first
responder entities.
(23) NIST.--The term ``NIST'' means the National
Institute of Standards and Technology.
(24) NTIA.--The term ``NTIA'' means the National
Telecommunications and Information Administration.
(25) Public safety answering point.--The term
``public safety answering point'' has the meaning given
such term in section 222 of the Communications Act of
1934 (47 U.S.C. 222).
(26) Public safety entity.--The term ``public
safety entity'' means an entity that provides public
safety services.
(27) Public safety services.--The term ``public
safety services''--
(A) has the meaning given the term in
section 337(f) of the Communications Act of
1934 (47 U.S.C. 337(f)); and
(B) includes services provided by emergency
response providers, as that term is defined in
section 2 of the Homeland Security Act of 2002
(6 U.S.C. 101).
(28) Public safety trust fund.--The term ``Public
Safety Trust Fund'' means the trust fund established
under section 6413(a)(1).
(29) Radio access network.--The term ``radio access
network'' means the radio access network described in
section 6202(b)(2).
(30) Reverse auction.--The term ``reverse auction''
means the portion of an incentive auction of broadcast
television spectrum under section 6403(a), in which a
broadcast television licensee may submit bids stating
the amount it would accept for voluntarily
relinquishing some or all of its broadcast television
spectrum usage rights.
(31) State.--The term ``State'' has the meaning
given such term in section 3 of the Communications Act
of 1934 (47 U.S.C. 153).
(32) Ultra high frequency.--The term ``ultra high
frequency'' means, with respect to a television
channel, that the channel is located in the portion of
the electromagnetic spectrum between the frequencies
from 470 megahertz to 698 megahertz.
(33) Very high frequency.--The term ``very high
frequency'' means, with respect to a television
channel, that the channel is located in the portion of
the electromagnetic spectrum between the frequencies
from 54 megahertz to 72 megahertz, from 76 megahertz to
88 megahertz, or from 174 megahertz to 216 megahertz.
SEC. 6002. RULE OF CONSTRUCTION.
Each range of frequencies described in this title shall be
construed to be inclusive of the upper and lower frequencies in
the range.
SEC. 6003. ENFORCEMENT.
(a) In General.--The Commission shall implement and enforce
this title as if this title is a part of the Communications Act
of 1934 (47 U.S.C. 151 et seq.). A violation of this title, or
a regulation promulgated under this title, shall be considered
to be a violation of the Communications Act of 1934, or a
regulation promulgated under such Act, respectively.
(b) Exceptions.--
(1) Other agencies.--Subsection (a) does not apply
in the case of a provision of this title that is
expressly required to be carried out by an agency (as
defined in section 551 of title 5, United States Code)
other than the Commission.
(2) NTIA regulations.--The Assistant Secretary may
promulgate such regulations as are necessary to
implement and enforce any provision of this title that
is expressly required to be carried out by the
Assistant Secretary.
SEC. 6004. NATIONAL SECURITY RESTRICTIONS ON USE OF FUNDS AND AUCTION
PARTICIPATION.
(a) Use of Funds.--No funds made available by subtitle B or
C may be used to make payments under a contract to a person
described in subsection (c).
(b) Auction Participation.--A person described in
subsection (c) may not participate in a system of competitive
bidding under section 309(j) of the Communications Act of 1934
(47 U.S.C. 309(j))--
(1) that is required to be conducted by this title;
or
(2) in which any spectrum usage rights for which
licenses are being assigned were made available under
clause (i) of subparagraph (G) of paragraph (8) of such
section, as added by section 6402.
(c) Person Described.--A person described in this
subsection is a person who has been, for reasons of national
security, barred by any agency of the Federal Government from
bidding on a contract, participating in an auction, or
receiving a grant.
Subtitle A--Reallocation of Public Safety Spectrum
SEC. 6101. REALLOCATION OF D BLOCK TO PUBLIC SAFETY.
(a) In General.--The Commission shall reallocate the 700
MHz D block spectrum for use by public safety entities in
accordance with the provisions of this Act.
(b) Spectrum Allocation.--Section 337(a) of the
Communications Act of 1934 (47 U.S.C. 337(a)) is amended--
(1) by striking ``24'' in paragraph (1) and
inserting ``34''; and
(2) by striking ``36'' in paragraph (2) and
inserting ``26''.
SEC. 6102. FLEXIBLE USE OF NARROWBAND SPECTRUM.
The Commission may allow the narrowband spectrum to be used
in a flexible manner, including usage for public safety
broadband communications, subject to such technical and
interference protection measures as the Commission may require.
SEC. 6103. 470-512 MHZ PUBLIC SAFETY SPECTRUM.
(a) In General.--Not later than 9 years after the date of
enactment of this title, the Commission shall--
(1) reallocate the spectrum in the 470-512 MHz band
(referred to in this section as the ``T-Band
spectrum'') currently used by public safety eligibles
as identified in section 90.303 of title 47, Code of
Federal Regulations; and
(2) begin a system of competitive bidding under
section 309(j) of the Communications Act of 1934 (47
U.S.C. 309(j)) to grant new initial licenses for the
use of the spectrum described in paragraph (1).
(b) Auction Proceeds.--Proceeds (including deposits and
upfront payments from successful bidders) from the competitive
bidding system described in subsection (a)(2) shall be
available to the Assistant Secretary to make grants in such
sums as necessary to cover relocation costs for the relocation
of public safety entities from the T-Band spectrum.
(c) Relocation.--Relocation shall be completed not later
than 2 years after the date on which the system of competitive
bidding described in subsection (a)(2) is completed.
Subtitle B--Governance of Public Safety Spectrum
SEC. 6201. SINGLE PUBLIC SAFETY WIRELESS NETWORK LICENSEE.
(a) Reallocation and Grant of License.--Notwithstanding any
other provision of law, and subject to the provisions of this
Act, the Commission shall reallocate and grant a license to the
First Responder Network Authority for the use of the 700 MHz D
block spectrum and existing public safety broadband spectrum.
(b) Term of License.--
(1) Initial license.--The license granted under
subsection (a) shall be for an initial term of 10 years
from the date of the initial issuance of the license.
(2) Renewal of license.--Prior to expiration of the
term of the initial license granted under subsection
(a) or the expiration of any subsequent renewal of such
license, the First Responder Network Authority shall
submit to the Commission an application for the renewal
of such license. Such renewal application shall
demonstrate that, during the preceding license term,
the First Responder Network Authority has met the
duties and obligations set forth under this Act. A
renewal license granted under this paragraph shall be
for a term of not to exceed 10 years.
(c) Facilitation of Transition.--The Commission shall take
all actions necessary to facilitate the transition of the
existing public safety broadband spectrum to the First
Responder Network Authority.
SEC. 6202. PUBLIC SAFETY BROADBAND NETWORK.
(a) Establishment.--The First Responder Network Authority
shall ensure the establishment of a nationwide, interoperable
public safety broadband network.
(b) Network Components.--The nationwide public safety
broadband network shall be based on a single, national network
architecture that evolves with technological advancements and
initially consists of--
(1) a core network that--
(A) consists of national and regional data
centers, and other elements and functions that
may be distributed geographically, all of which
shall be based on commercial standards; and
(B) provides the connectivity between--
(i) the radio access network; and
(ii) the public Internet or the
public switched network, or both; and
(2) a radio access network that--
(A) consists of all cell site equipment,
antennas, and backhaul equipment, based on
commercial standards, that are required to
enable wireless communications with devices
using the public safety broadband spectrum; and
(B) shall be developed, constructed,
managed, maintained, and operated taking into
account the plans developed in the State,
local, and tribal planning and implementation
grant program under section 6302(a).
SEC. 6203. PUBLIC SAFETY INTEROPERABILITY BOARD.
(a) Establishment.--There is established within the
Commission an advisory board to be known as the ``Technical
Advisory Board for First Responder Interoperability''.
(b) Membership.--
(1) In general.--
(A) Voting members.--Not later than 30 days
after the date of enactment of this title, the
Chairman of the Commission shall appoint 14
voting members to the Interoperability Board,
of which--
(i) 4 members shall be
representatives of wireless providers,
of which--
(I) 2 members shall be
representatives of national
wireless providers;
(II) 1 member shall be a
representative of regional
wireless providers; and
(III) 1 member shall be a
representative of rural
wireless providers;
(ii) 3 members shall be
representatives of equipment
manufacturers;
(iii) 4 members shall be
representatives of public safety
entities, of which--
(I) not less than 1 member
shall be a representative of
management level employees of
public safety entities; and
(II) not less than 1 member
shall be a representative of
employees of public safety
entities;
(iv) 3 members shall be
representatives of State and local
governments, chosen to reflect
geographic and population density
differences across the United States;
and
(v) all members shall have specific
expertise necessary to developing
technical requirements under this
section, such as technical expertise,
public safety communications expertise,
and commercial network experience.
(B) Non-voting member.--The Assistant
Secretary shall appoint 1 non-voting member to
the Interoperability Board.
(2) Period of appointment.--
(A) In general.--Except as provided in
subparagraph (B), members of the
Interoperability Board shall be appointed for
the life of the Interoperability Board.
(B) Removal for cause.--A member of the
Interoperability Board may be removed for cause
upon the determination of the Chairman of the
Commission.
(3) Vacancies.--Any vacancy in the Interoperability
Board shall not affect the powers of the
Interoperability Board, and shall be filled in the same
manner as the original appointment.
(4) Chairperson and vice chairperson.--The
Interoperability Board shall select a Chairperson and
Vice Chairperson from among the members of the
Interoperability Board.
(5) Quorum.--A majority of the members of the
Interoperability Board shall constitute a quorum.
(c) Duties of the Interoperability Board.--
(1) Development of technical requirements.--Not
later than 90 days after the date of enactment of this
Act, the Interoperability Board, in consultation with
the NTIA, NIST, and the Office of Emergency
Communications of the Department of Homeland Security,
shall--
(A) develop recommended minimum technical
requirements to ensure a nationwide level of
interoperability for the nationwide public
safety broadband network; and
(B) submit to the Commission for review in
accordance with paragraph (3) recommended
minimum technical requirements described in
subparagraph (A).
(2) Consideration.--In developing recommended
minimum technical requirements under paragraph (1), the
Interoperability Board shall base the recommended
minimum technical requirements on the commercial
standards for Long Term Evolution (LTE) service.
(3) Approval of recommendations.--
(A) In general.--Not later than 30 days
after the date on which the Interoperability
Board submits recommended minimum technical
requirements under paragraph (1)(B), the
Commission shall approve the recommendations,
with any revisions it deems necessary, and
transmit such recommendations to the First
Responder Network Authority.
(B) Review.--Any actions taken under
subparagraph (A) shall not be reviewable as a
final agency action.
(d) Travel Expenses.--The members of the Interoperability
Board shall be allowed travel expenses, including per diem in
lieu of subsistence, at rates authorized for employees of
agencies under subchapter I of chapter 57 of title 5, United
States Code, while away from their homes or regular places of
business in the performance of services for the
Interoperability Board.
(e) Exemption From FACA.--The Federal Advisory Committee
Act (5 U.S.C. App.) shall not apply to the Interoperability
Board.
(f) Termination of Authority.--The Interoperability Board
shall terminate 15 days after the date on which the Commission
transmits the recommendations to the First Responder Network
Authority under subsection (c)(3)(A).
SEC. 6204. ESTABLISHMENT OF THE FIRST RESPONDER NETWORK AUTHORITY.
(a) Establishment.--There is established as an independent
authority within the NTIA the ``First Responder Network
Authority'' or ``FirstNet''.
(b) Board.--
(1) In general.--The First Responder Network
Authority shall be headed by a Board, which shall
consist of--
(A) the Secretary of Homeland Security;
(B) the Attorney General of the United
States;
(C) the Director of the Office of
Management and Budget; and
(D) 12 individuals appointed by the
Secretary of Commerce in accordance with
paragraph (2).
(2) Appointments.--
(A) In general.--In making appointments
under paragraph (1)(D), the Secretary of
Commerce shall--
(i) appoint not fewer than 3
individuals to represent the collective
interests of the States, localities,
tribes, and territories;
(ii) seek to ensure geographic and
regional representation of the United
States in such appointments;
(iii) seek to ensure rural and
urban representation in such
appointments; and
(iv) appoint not fewer than 3
individuals who have served as public
safety professionals.
(B) Required qualifications.--
(i) In general.--Each member
appointed under paragraph (1)(D) should
meet not less than 1 of the following
criteria:
(I) Public safety
experience.--Knowledge and
experience in the use of
Federal, State, local, or
tribal public safety or
emergency response.
(II) Technical expertise.--
Technical expertise and fluency
regarding broadband
communications, including
public safety communications.
(III) Network expertise.--
Expertise in building,
deploying, and operating
commercial telecommunications
networks.
(IV) Financial expertise.--
Expertise in financing and
funding telecommunications
networks.
(ii) Expertise to be represented.--
In making appointments under paragraph
(1)(D), the Secretary of Commerce shall
appoint--
(I) not fewer than 1
individual who satisfies the
requirement under subclause
(II) of clause (i);
(II) not fewer than 1
individual who satisfies the
requirement under subclause
(III) of clause (i); and
(III) not fewer than 1
individual who satisfies the
requirement under subclause
(IV) of clause (i).
(C) Citizenship.--No individual other than
a citizen of the United States may serve as a
member of the Board.
(c) Terms of Appointment.--
(1) Initial appointment deadline.--Members of the
Board shall be appointed not later than 180 days after
the date of the enactment of this title.
(2) Terms.--
(A) Length.--
(i) In general.--Each member of the
Board described in subparagraphs (A)
through (C) of subsection (b)(1) shall
serve as a member of the Board for the
life of the First Responder Network
Authority.
(ii) Appointed individuals.--The
term of office of each individual
appointed to be a member of the Board
under subsection (b)(1)(D) shall be 3
years. No member described in this
clause may serve more than 2
consecutive full 3-year terms.
(B) Expiration of term.--Any member whose
term has expired may serve until such member's
successor has taken office, or until the end of
the calendar year in which such member's term
has expired, whichever is earlier.
(C) Appointment to fill vacancy.--Any
member appointed to fill a vacancy occurring
prior to the expiration of the term for which
that member's predecessor was appointed shall
be appointed for the remainder of the
predecessor's term.
(D) Staggered terms.--With respect to the
initial members of the Board appointed under
subsection (b)(1)(D)--
(i) 4 members shall serve for a
term of 3 years;
(ii) 4 members shall serve for a
term of 2 years; and
(iii) 4 members shall serve for a
term of 1 year.
(3) Vacancies.--A vacancy in the membership of the
Board shall not affect the Board's powers, and shall be
filled in the same manner as the original member was
appointed.
(d) Chair.--
(1) Selection.--The Secretary of Commerce shall
select, from among the members of the Board appointed
under subsection (b)(1)(D), an individual to serve for
a 2-year term as Chair of the Board.
(2) Consecutive terms.--An individual may not serve
for more than 2 consecutive terms as Chair of the
Board.
(e) Meetings.--
(1) Frequency.--The Board shall meet--
(A) at the call of the Chair ; and
(B) not less frequently than once each
quarter.
(2) Transparency.--Meetings of the Board, including
any committee of the Board, shall be open to the
public. The Board may, by majority vote, close any such
meeting only for the time necessary to preserve the
confidentiality of commercial or financial information
that is privileged or confidential, to discuss
personnel matters, or to discuss legal matters
affecting the First Responder Network Authority,
including pending or potential litigation.
(f) Quorum.--Eight members of the Board shall constitute a
quorum, including at least 6 of the members appointed under
subsection (b)(1)(D).
(g) Compensation.--
(1) In general.--The members of the Board appointed
under subsection (b)(1)(D) shall be compensated at the
daily rate of basic pay for level IV of the Executive
Schedule for each day during which such members are
engaged in performing a function of the Board.
(2) Prohibition on compensation.--A member of the
Board appointed under subparagraphs (A) through (C) of
subsection (b)(1) shall serve without additional pay,
and shall not otherwise benefit, directly or
indirectly, as a result of their service to the First
Responder Network Authority, but shall be allowed a per
diem allowance for travel expenses, at rates authorized
for an employee of an agency under subchapter I of
chapter 57 of title 5, United States Code, while away
from the home or regular place of business of the
member in the performance of the duties of the First
Responder Network Authority.
SEC. 6205. ADVISORY COMMITTEES OF THE FIRST RESPONDER NETWORK
AUTHORITY.
(a) Advisory Committees.--The First Responder Network
Authority--
(1) shall establish a standing public safety
advisory committee to assist the First Responder
Network Authority in carrying out its duties and
responsibilities under this subtitle; and
(2) may establish additional standing or ad hoc
committees, panels, or councils as the First Responder
Network Authority determines are necessary.
(b) Selection of Agents, Consultants, and Experts.--
(1) In general.--The First Responder Network
Authority shall select parties to serve as its agents,
consultants, or experts in a fair, transparent, and
objective manner, and such agents may include a program
manager to carry out certain of the duties and
responsibilities of deploying and operating the
nationwide public safety broadband network described in
subsections (b) and (c) of section 6206.
(2) Binding and final.--If the selection of an
agent, consultant, or expert satisfies the requirements
under paragraph (1), the selection of that agent,
consultant, or expert shall be final and binding.
SEC. 6206. POWERS, DUTIES, AND RESPONSIBILITIES OF THE FIRST RESPONDER
NETWORK AUTHORITY.
(a) General Powers.--The First Responder Network Authority
shall have the authority to do the following:
(1) To exercise, through the actions of its Board,
all powers specifically granted by the provisions of
this subtitle, and such incidental powers as shall be
necessary.
(2) To hold such hearings, sit and act at such
times and places, take such testimony, and receive such
evidence as the First Responder Network Authority
considers necessary to carry out its responsibilities
and duties.
(3) To obtain grants and funds from and make
contracts with individuals, private companies,
organizations, institutions, and Federal, State,
regional, and local agencies.
(4) To accept, hold, administer, and utilize gifts,
donations, and bequests of property, both real and
personal, for the purposes of aiding or facilitating
the work of the First Responder Network Authority.
(5) To spend funds under paragraph (3) in a manner
authorized by the Board, but only for purposes that
will advance or enhance public safety communications
consistent with this title.
(6) To take such other actions as the First
Responder Network Authority (through the Board) may
from time to time determine necessary, appropriate, or
advisable to accomplish the purposes of this title.
(b) Duty and Responsibility To Deploy and Operate a
Nationwide Public Safety Broadband Network.--
(1) In general.--The First Responder Network
Authority shall hold the single public safety wireless
license granted under section 6201 and take all actions
necessary to ensure the building, deployment, and
operation of the nationwide public safety broadband
network, in consultation with Federal, State, tribal,
and local public safety entities, the Director of NIST,
the Commission, and the public safety advisory
committee established in section 6205(a), including by,
at a minimum--
(A) ensuring nationwide standards for use
and access of the network;
(B) issuing open, transparent, and
competitive requests for proposals to private
sector entities for the purposes of building,
operating, and maintaining the network that
use, without materially changing, the minimum
technical requirements developed under section
6203;
(C) encouraging that such requests
leverage, to the maximum extent economically
desirable, existing commercial wireless
infrastructure to speed deployment of the
network; and
(D) managing and overseeing the
implementation and execution of contracts or
agreements with non-Federal entities to build,
operate, and maintain the network.
(2) Requirements.--In carrying out the duties and
responsibilities of this subsection, including issuing
requests for proposals, the First Responder Network
Authority shall--
(A) ensure the safety, security, and
resiliency of the network, including
requirements for protecting and monitoring the
network to protect against cyberattack;
(B) promote competition in the equipment
market, including devices for public safety
communications, by requiring that equipment for
use on the network be--
(i) built to open, non-proprietary,
commercially available standards;
(ii) capable of being used by any
public safety entity and by multiple
vendors across all public safety
broadband networks operating in the 700
MHz band; and
(iii) backward-compatible with
existing commercial networks to the
extent that such capabilities are
necessary and technically and
economically reasonable;
(C) promote integration of the network with
public safety answering points or their
equivalent; and
(D) address special considerations for
areas or regions with unique homeland security
or national security needs.
(3) Rural coverage.--In carrying out the duties and
responsibilities of this subsection, including issuing
requests for proposals, the nationwide, interoperable
public safety broadband network, consistent with the
license granted under section 6201, shall require
deployment phases with substantial rural coverage
milestones as part of each phase of the construction
and deployment of the network. To the maximum extent
economically desirable, such proposals shall include
partnerships with existing commercial mobile providers
to utilize cost-effective opportunities to speed
deployment in rural areas.
(4) Execution of authority.--In carrying out the
duties and responsibilities of this subsection, the
First Responder Network Authority may--
(A) obtain grants from and make contracts
with individuals, private companies, and
Federal, State, regional, and local agencies;
(B) hire or accept voluntary services of
consultants, experts, advisory boards, and
panels to aid the First Responder Network
Authority in carrying out such duties and
responsibilities;
(C) receive payment for use of--
(i) network capacity licensed to
the First Responder Network Authority;
and
(ii) network infrastructure
constructed, owned, or operated by the
First Responder Network Authority; and
(D) take such other actions as may be
necessary to accomplish the purposes set forth
in this subsection.
(c) Other Specific Duties and Responsibilities.--
(1) Establishment of network policies.--In carrying
out the requirements under subsection (b), the First
Responder Network Authority shall develop--
(A) requests for proposals with
appropriate--
(i) timetables for construction,
including by taking into consideration
the time needed to build out to rural
areas and the advantages offered
through partnerships with existing
commercial providers under paragraph
(3);
(ii) coverage areas, including
coverage in rural and nonurban areas;
(iii) service levels;
(iv) performance criteria; and
(v) other similar matters for the
construction and deployment of such
network;
(B) the technical and operational
requirements of the network;
(C) practices, procedures, and standards
for the management and operation of such
network;
(D) terms of service for the use of such
network, including billing practices; and
(E) ongoing compliance review and
monitoring of the--
(i) management and operation of
such network;
(ii) practices and procedures of
the entities operating on and the
personnel using such network; and
(iii) necessary training needs of
network operators and users.
(2) State and local planning.--
(A) Required consultation.--In developing
requests for proposals and otherwise carrying
out its responsibilities under this Act, the
First Responder Network Authority shall consult
with regional, State, tribal, and local
jurisdictions regarding the distribution and
expenditure of any amounts required to carry
out the policies established under paragraph
(1), including with regard to the--
(i) construction of a core network
and any radio access network build out;
(ii) placement of towers;
(iii) coverage areas of the
network, whether at the regional,
State, tribal, or local level;
(iv) adequacy of hardening,
security, reliability, and resiliency
requirements;
(v) assignment of priority to local
users;
(vi) assignment of priority and
selection of entities seeking access to
or use of the nationwide public safety
interoperable broadband network
established under subsection (b); and
(vii) training needs of local
users.
(B) Method of consultation.--The
consultation required under subparagraph (A)
shall occur between the First Responder Network
Authority and the single officer or
governmental body designated under section
6302(d).
(3) Leveraging existing infrastructure.--In
carrying out the requirement under subsection (b), the
First Responder Network Authority shall enter into
agreements to utilize, to the maximum extent
economically desirable, existing--
(A) commercial or other communications
infrastructure; and
(B) Federal, State, tribal, or local
infrastructure.
(4) Maintenance and upgrades.--The First Responder
Network Authority shall ensure the maintenance,
operation, and improvement of the nationwide public
safety broadband network, including by ensuring that
the First Responder Network Authority updates and
revises any policies established under paragraph (1) to
take into account new and evolving technologies.
(5) Roaming agreements.--The First Responder
Network Authority shall negotiate and enter into, as it
determines appropriate, roaming agreements with
commercial network providers to allow the nationwide
public safety broadband network to roam onto commercial
networks and gain prioritization of public safety
communications over such networks in times of an
emergency.
(6) Network infrastructure and device criteria.--
The Director of NIST, in consultation with the First
Responder Network Authority and the Commission, shall
ensure the development of a list of certified devices
and components meeting appropriate protocols and
standards for public safety entities and commercial
vendors to adhere to, if such entities or vendors seek
to have access to, use of, or compatibility with the
nationwide public safety broadband network.
(7) Representation before standard setting
entities.--The First Responder Network Authority, in
consultation with the Director of NIST, the Commission,
and the public safety advisory committee established
under section 6205(a), shall represent the interests of
public safety users of the nationwide public safety
broadband network before any proceeding, negotiation,
or other matter in which a standards organization,
standards body, standards development organization, or
any other recognized standards-setting entity addresses
the development of standards relating to
interoperability.
(8) Prohibition on negotiation with foreign
governments.--The First Responder Network Authority
shall not have the authority to negotiate or enter into
any agreements with a foreign government on behalf of
the United States.
(d) Exemption From Certain Laws.--Any action taken or
decisions made by the First Responder Network Authority shall
be exempt from the requirements of--
(1) section 3506 of title 44, United States Code
(commonly referred to as the Paperwork Reduction Act);
(2) chapter 5 of title 5, United States Code
(commonly referred to as the Administrative Procedures
Act); and
(3) chapter 6 of title 5, United States Code
(commonly referred to as the Regulatory Flexibility
Act).
(e) Network Construction Fund.--
(1) Establishment.--There is established in the
Treasury of the United States a fund to be known as the
``Network Construction Fund''.
(2) Use of fund.--Amounts deposited into the
Network Construction Fund shall be used by the--
(A) First Responder Network Authority to
carry out this section, except for
administrative expenses; and
(B) NTIA to make grants to States under
section 6302(e)(3)(C)(iii)(I).
(f) Termination of Authority.--The authority of the First
Responder Network Authority shall terminate on the date that is
15 years after the date of enactment of this title.
(g) GAO Report.--Not later than 10 years after the date of
the enactment of this Act, the Comptroller General of the
United States shall submit to Congress a report on what action
Congress should take regarding the 15-year sunset of authority
under subsection (f).
SEC. 6207. INITIAL FUNDING FOR THE FIRST RESPONDER NETWORK AUTHORITY.
(a) Borrowing Authority.--Prior to the deposit of proceeds
into the Public Safety Trust Fund from the incentive auctions
to be carried out under section 309(j)(8)(G) of the
Communications Act of 1934 or the auction of spectrum pursuant
to section 6401, the NTIA may borrow from the Treasury such
sums as may be necessary, but not to exceed $2,000,000,000, to
implement this subtitle. The NTIA shall reimburse the Treasury,
without interest, from funds deposited into the Public Safety
Trust Fund.
(b) Prohibition.--
(1) In general.--Administrative expenses of the
First Responder Network Authority may not exceed
$100,000,000 during the 10-year period beginning on the
date of enactment of this title.
(2) Definition.--For purposes of this subsection,
the term ``administrative expenses'' does not include
the costs incurred by the First Responder Network
Authority for oversight and audits to protect against
waste, fraud, and abuse.
SEC. 6208. PERMANENT SELF-FUNDING; DUTY TO ASSESS AND COLLECT FEES FOR
NETWORK USE.
(a) In General.--Notwithstanding section 337 of the
Communications Act of 1934 (47 U.S.C. 337), the First Responder
Network Authority is authorized to assess and collect the
following fees:
(1) Network user fee.--A user or subscription fee
from each entity, including any public safety entity or
secondary user, that seeks access to or use of the
nationwide public safety broadband network.
(2) Lease fees related to network capacity.--
(A) In general.--A fee from any entity that
seeks to enter into a covered leasing
agreement.
(B) Covered leasing agreement.--For
purposes of subparagraph (A), a ``covered
leasing agreement'' means a written agreement
resulting from a public-private arrangement to
construct, manage, and operate the nationwide
public safety broadband network between the
First Responder Network Authority and secondary
user to permit--
(i) access to network capacity on a
secondary basis for non-public safety
services; and
(ii) the spectrum allocated to such
entity to be used for commercial
transmissions along the dark fiber of
the long-haul network of such entity.
(3) Lease fees related to network equipment and
infrastructure.--A fee from any entity that seeks
access to or use of any equipment or infrastructure,
including antennas or towers, constructed or otherwise
owned by the First Responder Network Authority
resulting from a public-private arrangement to
construct, manage, and operate the nationwide public
safety broadband network.
(b) Establishment of Fee Amounts; Permanent Self-funding.--
The total amount of the fees assessed for each fiscal year
pursuant to this section shall be sufficient, and shall not
exceed the amount necessary, to recoup the total expenses of
the First Responder Network Authority in carrying out its
duties and responsibilities described under this subtitle for
the fiscal year involved.
(c) Annual Approval.--The NTIA shall review the fees
assessed under this section on an annual basis, and such fees
may only be assessed if approved by the NTIA.
(d) Required Reinvestment of Funds.--The First Responder
Network Authority shall reinvest amounts received from the
assessment of fees under this section in the nationwide public
safety interoperable broadband network by using such funds only
for constructing, maintaining, operating, or improving the
network.
SEC. 6209. AUDIT AND REPORT.
(a) Audit.--
(1) In general.--The Secretary of Commerce shall
enter into a contract with an independent auditor to
conduct an audit, on an annual basis, of the First
Responder Network Authority in accordance with general
accounting principles and procedures applicable to
commercial corporate transactions. Each audit conducted
under this paragraph shall be made available to the
appropriate committees of Congress.
(2) Location.--Any audit conducted under paragraph
(1) shall be conducted at the place or places where
accounts of the First Responder Network Authority are
normally kept.
(3) Access to first responder network authority
books and documents.--
(A) In general.--For purposes of an audit
conducted under paragraph (1), the
representatives of the independent auditor
shall--
(i) have access to all books,
accounts, records, reports, files, and
all other papers, things, or property
belonging to or in use by the First
Responder Network Authority that
pertain to the financial transactions
of the First Responder Network
Authority and are necessary to
facilitate the audit; and
(ii) be afforded full facilities
for verifying transactions with the
balances or securities held by
depositories, fiscal agents, and
custodians.
(B) Requirement.--All books, accounts,
records, reports, files, papers, and property
of the First Responder Network Authority shall
remain in the possession and custody of the
First Responder Network Authority.
(b) Report.--
(1) In general.--The independent auditor selected
to conduct an audit under this section shall submit a
report of each audit conducted under subsection (a)
to--
(A) the appropriate committees of Congress;
(B) the President; and
(C) the First Responder Network Authority.
(2) Contents.--Each report submitted under
paragraph (1) shall contain--
(A) such comments and information as the
independent auditor determines necessary to
inform Congress of the financial operations and
condition of the First Responder Network
Authority;
(B) any recommendations of the independent
auditor relating to the financial operations
and condition of the First Responder Network
Authority; and
(C) a description of any program,
expenditure, or other financial transaction or
undertaking of the First Responder Network
Authority that was observed during the course
of the audit, which, in the opinion of the
independent auditor, has been carried on or
made without the authority of law.
SEC. 6210. ANNUAL REPORT TO CONGRESS.
(a) In General.--Not later than 1 year after the date of
enactment of this Act, and each year thereafter, the First
Responder Network Authority shall submit an annual report
covering the preceding fiscal year to the appropriate
committees of Congress.
(b) Required Content.--The report required under subsection
(a) shall include--
(1) a comprehensive and detailed report of the
operations, activities, financial condition, and
accomplishments of the First Responder Network
Authority under this section; and
(2) such recommendations or proposals for
legislative or administrative action as the First
Responder Network Authority deems appropriate.
(c) Availability to Testify.--The members of the Board and
employees of the First Responder Network Authority shall be
available to testify before the appropriate committees of the
Congress with respect to--
(1) the report required under subsection (a);
(2) the report of any audit conducted under section
6210; or
(3) any other matter which such committees may
determine appropriate.
SEC. 6211. PUBLIC SAFETY ROAMING AND PRIORITY ACCESS.
The Commission may adopt rules, if necessary in the public
interest, to improve the ability of public safety networks to
roam onto commercial networks and to gain priority access to
commercial networks in an emergency if--
(1) the public safety entity equipment is
technically compatible with the commercial network;
(2) the commercial network is reasonably
compensated; and
(3) such access does not preempt or otherwise
terminate or degrade all existing voice conversations
or data sessions.
SEC. 6212. PROHIBITION ON DIRECT OFFERING OF COMMERCIAL
TELECOMMUNICATIONS SERVICE DIRECTLY TO CONSUMERS.
(a) In General.--The First Responder Network Authority
shall not offer, provide, or market commercial
telecommunications or information services directly to
consumers.
(b) Rule of Construction.--Nothing in this section shall be
construed to prohibit the First Responder Network Authority and
a secondary user from entering into a covered leasing agreement
pursuant to section 6208(a)(2)(B). Nothing in this section
shall be construed to limit the First Responder Network
Authority from collecting lease fees related to network
equipment and infrastructure pursuant to section 6208(a)(3).
SEC. 6213. PROVISION OF TECHNICAL ASSISTANCE.
The Commission may provide technical assistance to the
First Responder Network Authority and may take any action
necessary to assist the First Responder Network Authority in
effectuating its duties and responsibilities under this
subtitle.
Subtitle C--Public Safety Commitments
SEC. 6301. STATE AND LOCAL IMPLEMENTATION FUND.
(a) Establishment.--There is established in the Treasury of
the United States a fund to be known as the State and Local
Implementation Fund.
(b) Amounts Available for State and Local Implementation
Grant Program.--Any amounts borrowed under subsection (c)(1)
and any amounts in the State and Local Implementation Fund that
are not necessary to reimburse the general fund of the Treasury
for such borrowed amounts shall be available to the Assistant
Secretary to implement section 6302.
(c) Borrowing Authority.--
(1) In general.--Prior to the end of fiscal year
2022, the Assistant Secretary may borrow from the
general fund of the Treasury such sums as may be
necessary, but not to exceed $135,000,000, to implement
section 6302.
(2) Reimbursement.--The Assistant Secretary shall
reimburse the general fund of the Treasury, without
interest, for any amounts borrowed under paragraph (1)
as funds are deposited into the State and Local
Implementation Fund.
(d) Transfer of Unused Funds.--If there is a balance
remaining in the State and Local Implementation Fund on
September 30, 2022, the Secretary of the Treasury shall
transfer such balance to the general fund of the Treasury,
where such balance shall be dedicated for the sole purpose of
deficit reduction.
SEC. 6302. STATE AND LOCAL IMPLEMENTATION.
(a) Establishment of State and Local Implementation Grant
Program.--The Assistant Secretary, in consultation with the
First Responder Network Authority, shall take such action as is
necessary to establish a grant program to make grants to States
to assist State, regional, tribal, and local jurisdictions to
identify, plan, and implement the most efficient and effective
way for such jurisdictions to utilize and integrate the
infrastructure, equipment, and other architecture associated
with the nationwide public safety broadband network to satisfy
the wireless communications and data services needs of that
jurisdiction, including with regards to coverage, siting, and
other needs.
(b) Matching Requirements; Federal Share.--
(1) In general.--The Federal share of the cost of
any activity carried out using a grant under this
section may not exceed 80 percent of the eligible costs
of carrying out that activity, as determined by the
Assistant Secretary, in consultation with the First
Responder Network Authority.
(2) Waiver.--The Assistant Secretary may waive, in
whole or in part, the requirements of paragraph (1) for
good cause shown if the Assistant Secretary determines
that such a waiver is in the public interest.
(c) Programmatic Requirements.--Not later than 6 months
after the date of enactment of this Act, the Assistant
Secretary, in consultation with the First Responder Network
Authority, shall establish requirements relating to the grant
program to be carried out under this section, including the
following:
(1) Defining eligible costs for purposes of
subsection (b)(1).
(2) Determining the scope of eligible activities
for grant funding under this section.
(3) Prioritizing grants for activities that ensure
coverage in rural as well as urban areas.
(d) Certification and Designation of Officer or
Governmental Body.--In carrying out the grant program
established under this section, the Assistant Secretary shall
require each State to certify in its application for grant
funds that the State has designated a single officer or
governmental body to serve as the coordinator of implementation
of the grant funds.
(e) State Network.--
(1) Notice.--Upon the completion of the request for
proposal process conducted by the First Responder
Network Authority for the construction, operation,
maintenance, and improvement of the nationwide public
safety broadband network, the First Responder Network
Authority shall provide to the Governor of each State,
or his designee--
(A) notice of the completion of the request
for proposal process;
(B) details of the proposed plan for
buildout of the nationwide, interoperable
broadband network in such State; and
(C) the funding level for the State as
determined by the NTIA.
(2) State decision.--Not later than 90 days after
the date on which the Governor of a State receives
notice under paragraph (1), the Governor shall choose
whether to--
(A) participate in the deployment of the
nationwide, interoperable broadband network as
proposed by the First Responder Network
Authority; or
(B) conduct its own deployment of a radio
access network in such State.
(3) Process.--
(A) In general.--Upon making a decision to
opt-out under paragraph (2)(B), the Governor
shall notify the First Responder Network
Authority, the NTIA, and the Commission of such
decision.
(B) State request for proposals.--Not later
than 180 days after the date on which a
Governor provides notice under subparagraph
(A), the Governor shall develop and complete
requests for proposals for the construction,
maintenance, and operation of the radio access
network within the State.
(C) Submission and approval of alternative
plan.--
(i) In general.--The State shall
submit an alternative plan for the
construction, maintenance, operation,
and improvements of the radio access
network within the State to the
Commission, and such plan shall
demonstrate--
(I) that the State will be
in compliance with the minimum
technical interoperability
requirements developed under
section 6203; and
(II) interoperability with
the nationwide public safety
broadband network.
(ii) Commission approval or
disapproval.--Upon submission of a
State plan under clause (i), the
Commission shall either approve or
disapprove the plan.
(iii) Approval.--If the Commission
approves a plan under this
subparagraph, the State--
(I) may apply to the NTIA
for a grant to construct the
radio access network within the
State that includes the showing
described in subparagraph (D);
and
(II) shall apply to the
NTIA to lease spectrum capacity
from the First Responder
Network Authority.
(iv) Disapproval.--If the
Commission disapproves a plan under
this subparagraph, the construction,
maintenance, operation, and
improvements of the network within the
State shall proceed in accordance with
the plan proposed by the First
Responder Network Authority.
(D) Funding requirements.--In order to
obtain grant funds and spectrum capacity
leasing rights under subparagraph (C)(iii), a
State shall demonstrate--
(i) that the State has--
(I) the technical
capabilities to operate, and
the funding to support, the
State radio access network;
(II) has the ability to
maintain ongoing
interoperability with the
nationwide public safety
broadband network; and
(III) the ability to
complete the project within
specified comparable timelines
specific to the State;
(ii) the cost-effectiveness of the
State plan submitted under subparagraph
(C)(i); and
(iii) comparable security,
coverage, and quality of service to
that of the nationwide public safety
broadband network.
(f) User Fees.--If a State chooses to build its own radio
access network, the State shall pay any user fees associated
with State use of elements of the core network.
(g) Prohibition.--
(1) In general.--A State that chooses to build its
own radio access network shall not provide commercial
service to consumers or offer wholesale leasing
capacity of the network within the State except
directly through public-private partnerships for
construction, maintenance, operation, and improvement
of the network within the State.
(2) Rule of construction.--Nothing in this
subsection shall be construed to prohibit the State and
a secondary user from entering into a covered leasing
agreement. Any revenue gained by the State from such a
leasing agreement shall be used only for constructing,
maintaining, operating, or improving the radio access
network of the State.
(h) Judicial Review.--
(1) In general.--The United States District Court
for the District of Columbia shall have exclusive
jurisdiction to review a decision of the Commission
made under subsection (e)(3)(C)(iv).
(2) Standard of review.--The court shall affirm the
decision of the Commission unless--
(A) the decision was procured by
corruption, fraud, or undue means;
(B) there was actual partiality or
corruption in the Commission; or
(C) the Commission was guilty of misconduct
in refusing to hear evidence pertinent and
material to the decision or of any other
misbehavior by which the rights of any party
have been prejudiced.
SEC. 6303. PUBLIC SAFETY WIRELESS COMMUNICATIONS RESEARCH AND
DEVELOPMENT.
(a) NIST Directed Research and Development Program.--From
amounts made available from the Public Safety Trust Fund, the
Director of NIST, in consultation with the Commission, the
Secretary of Homeland Security, and the National Institute of
Justice of the Department of Justice, as appropriate, shall
conduct research and assist with the development of standards,
technologies, and applications to advance wireless public
safety communications.
(b) Required Activities.--In carrying out the requirement
under subsection (a), the Director of NIST, in consultation
with the First Responder Network Authority and the public
safety advisory committee established under section 6205(a),
shall--
(1) document public safety wireless communications
technical requirements;
(2) accelerate the development of the capability
for communications between currently deployed public
safety narrowband systems and the nationwide public
safety broadband network;
(3) establish a research plan, and direct research,
that addresses the wireless communications needs of
public safety entities beyond what can be provided by
the current generation of broadband technology;
(4) accelerate the development of mission critical
voice, including device-to-device ``talkaround''
capability over broadband networks, public safety
prioritization, authentication capabilities, and
standard application programing interfaces for the
nationwide public safety broadband network, if
necessary and practical;
(5) accelerate the development of communications
technology and equipment that can facilitate the
eventual migration of public safety narrowband
communications to the nationwide public safety
broadband network; and
(6) convene working groups of relevant government
and commercial parties to achieve the requirements in
paragraphs (1) through (5).
Subtitle D--Spectrum Auction Authority
SEC. 6401. DEADLINES FOR AUCTION OF CERTAIN SPECTRUM.
(a) Clearing Certain Federal Spectrum.--
(1) In general.--The President shall--
(A) not later than 3 years after the date
of the enactment of this Act, begin the process
of withdrawing or modifying the assignment to a
Federal Government station of the
electromagnetic spectrum described in paragraph
(2); and
(B) not later than 30 days after completing
the withdrawal or modification, notify the
Commission that the withdrawal or modification
is complete.
(2) Spectrum described.--The electromagnetic
spectrum described in this paragraph is the 15
megahertz of spectrum between 1675 megahertz and 1710
megahertz identified under paragraph (3).
(3) Identification by secretary of commerce.--Not
later than 1 year after the date of the enactment of
this Act, the Secretary of Commerce shall submit to the
President a report identifying 15 megahertz of spectrum
between 1675 megahertz and 1710 megahertz for
reallocation from Federal use to non-Federal use.
(b) Reallocation and Auction.--
(1) In general.--Notwithstanding paragraph (15)(A)
of section 309(j) of the Communications Act of 1934 (47
U.S.C. 309(j)), not later than 3 years after the date
of the enactment of this Act, the Commission shall,
except as provided in paragraph (4)--
(A) allocate the spectrum described in
paragraph (2) for commercial use; and
(B) through a system of competitive bidding
under such section, grant new initial licenses
for the use of such spectrum, subject to
flexible-use service rules.
(2) Spectrum described.--The spectrum described in
this paragraph is the following:
(A) The frequencies between 1915 megahertz
and 1920 megahertz.
(B) The frequencies between 1995 megahertz
and 2000 megahertz.
(C) The frequencies described in subsection
(a)(2).
(D) The frequencies between 2155 megahertz
and 2180 megahertz.
(E) Fifteen megahertz of contiguous
spectrum to be identified by the Commission.
(3) Proceeds to cover 110 percent of federal
relocation or sharing costs.--Nothing in paragraph (1)
shall be construed to relieve the Commission from the
requirements of section 309(j)(16)(B) of the
Communications Act of 1934 (47 U.S.C. 309(j)(16)(B)).
(4) Determination by commission.--If the Commission
determines that the band of frequencies described in
paragraph (2)(A) or the band of frequencies described
in paragraph (2)(B) cannot be used without causing
harmful interference to commercial mobile service
licensees in the frequencies between 1930 megahertz and
1995 megahertz, the Commission may not--
(A) allocate such band for commercial use
under paragraph (1)(A); or
(B) grant licenses under paragraph (1)(B)
for the use of such band.
(c) Auction Proceeds.--Section 309(j)(8) of the
Communications Act of 1934 (47 U.S.C. 309(j)(8)) is amended--
(1) in subparagraph (A), by striking ``(D), and
(E),'' and inserting ``(D), (E), (F), and (G),'';
(2) in subparagraph (C)(i), by striking
``subparagraph (E)(ii)'' and inserting ``subparagraphs
(D)(ii), (E)(ii), (F), and (G)'';
(3) in subparagraph (D)--
(A) by striking the heading and inserting
``Proceeds from reallocated federal spectrum.--
'';
(B) by striking ``Cash'' and inserting the
following:
``(i) In general.--Except as
provided in clause (ii), cash''; and
(C) by adding at the end the following:
``(ii) Certain other proceeds.--
Notwithstanding subparagraph (A) and
except as provided in subparagraph (B),
in the case of proceeds (including
deposits and upfront payments from
successful bidders) attributable to the
auction of eligible frequencies
described in paragraph (2) of section
113(g) of the National
Telecommunications and Information
Administration Organization Act that
are required to be auctioned by section
6401(b)(1)(B) of the Middle Class Tax
Relief and Job Creation Act of 2012,
such portion of such proceeds as is
necessary to cover the relocation or
sharing costs (as defined in paragraph
(3) of such section 113(g)) of Federal
entities relocated from such eligible
frequencies shall be deposited in the
Spectrum Relocation Fund. The remainder
of such proceeds shall be deposited in
the Public Safety Trust Fund
established by section 6413(a)(1) of
the Middle Class Tax Relief and Job
Creation Act of 2012.''; and
(4) by adding at the end the following:
``(F) Certain proceeds designated for
public safety trust fund.--Notwithstanding
subparagraph (A) and except as provided in
subparagraphs (B) and (D)(ii), the proceeds
(including deposits and upfront payments from
successful bidders) from the use of a system of
competitive bidding under this subsection
pursuant to section 6401(b)(1)(B) of the Middle
Class Tax Relief and Job Creation Act of 2012
shall be deposited in the Public Safety Trust
Fund established by section 6413(a)(1) of such
Act.''.
SEC. 6402. GENERAL AUTHORITY FOR INCENTIVE AUCTIONS.
Section 309(j)(8) of the Communications Act of 1934, as
amended by section 6401(c), is further amended by adding at the
end the following:
``(G) Incentive auctions.--
``(i) In general.--Notwithstanding
subparagraph (A) and except as provided
in subparagraph (B), the Commission may
encourage a licensee to relinquish
voluntarily some or all of its licensed
spectrum usage rights in order to
permit the assignment of new initial
licenses subject to flexible-use
service rules by sharing with such
licensee a portion, based on the value
of the relinquished rights as
determined in the reverse auction
required by clause (ii)(I), of the
proceeds (including deposits and
upfront payments from successful
bidders) from the use of a competitive
bidding system under this subsection.
``(ii) Limitations.--The Commission
may not enter into an agreement for a
licensee to relinquish spectrum usage
rights in exchange for a share of
auction proceeds under clause (i)
unless--
``(I) the Commission
conducts a reverse auction to
determine the amount of
compensation that licensees
would accept in return for
voluntarily relinquishing
spectrum usage rights; and
``(II) at least two
competing licensees participate
in the reverse auction.
``(iii) Treatment of revenues.--
Notwithstanding subparagraph (A) and
except as provided in subparagraph (B),
the proceeds (including deposits and
upfront payments from successful
bidders) from any auction, prior to the
end of fiscal year 2022, of spectrum
usage rights made available under
clause (i) that are not shared with
licensees under such clause shall be
deposited as follows:
``(I) $1,750,000,000 of the
proceeds from the incentive
auction of broadcast television
spectrum required by section
6403 of the Middle Class Tax
Relief and Job Creation Act of
2012 shall be deposited in the
TV Broadcaster Relocation Fund
established by subsection
(d)(1) of such section.
``(II) All other proceeds
shall be deposited--
``(aa) prior to the
end of fiscal year
2022, in the Public
Safety Trust Fund
established by section
6413(a)(1) of such Act;
and
``(bb) after the
end of fiscal year
2022, in the general
fund of the Treasury,
where such proceeds
shall be dedicated for
the sole purpose of
deficit reduction.
``(iv) Congressional
notification.--At least 3 months before
any incentive auction conducted under
this subparagraph, the Chairman of the
Commission, in consultation with the
Director of the Office of Management
and Budget, shall notify the
appropriate committees of Congress of
the methodology for calculating the
amounts that will be shared with
licensees under clause (i).
``(v) Definition.--In this
subparagraph, the term `appropriate
committees of Congress' means--
``(I) the Committee on
Commerce, Science, and
Transportation of the Senate;
``(II) the Committee on
Appropriations of the Senate;
``(III) the Committee on
Energy and Commerce of the
House of Representatives; and
``(IV) the Committee on
Appropriations of the House of
Representatives.''.
SEC. 6403. SPECIAL REQUIREMENTS FOR INCENTIVE AUCTION OF BROADCAST TV
SPECTRUM.
(a) Reverse Auction To Identify Incentive Amount.--
(1) In general.--The Commission shall conduct a
reverse auction to determine the amount of compensation
that each broadcast television licensee would accept in
return for voluntarily relinquishing some or all of its
broadcast television spectrum usage rights in order to
make spectrum available for assignment through a system
of competitive bidding under subparagraph (G) of
section 309(j)(8) of the Communications Act of 1934, as
added by section 6402.
(2) Eligible relinquishments.--A relinquishment of
usage rights for purposes of paragraph (1) shall
include the following:
(A) Relinquishing all usage rights with
respect to a particular television channel
without receiving in return any usage rights
with respect to another television channel.
(B) Relinquishing all usage rights with
respect to an ultra high frequency television
channel in return for receiving usage rights
with respect to a very high frequency
television channel.
(C) Relinquishing usage rights in order to
share a television channel with another
licensee.
(3) Confidentiality.--The Commission shall take all
reasonable steps necessary to protect the
confidentiality of Commission-held data of a licensee
participating in the reverse auction under paragraph
(1), including withholding the identity of such
licensee until the reassignments and reallocations (if
any) under subsection (b)(1)(B) become effective, as
described in subsection (f)(2).
(4) Protection of carriage rights of licensees
sharing a channel.--A broadcast television station that
voluntarily relinquishes spectrum usage rights under
this subsection in order to share a television channel
and that possessed carriage rights under section 338,
614, or 615 of the Communications Act of 1934 (47
U.S.C. 338; 534; 535) on November 30, 2010, shall have,
at its shared location, the carriage rights under such
section that would apply to such station at such
location if it were not sharing a channel.
(b) Reorganization of Broadcast TV Spectrum.--
(1) In general.--For purposes of making available
spectrum to carry out the forward auction under
subsection (c)(1), the Commission--
(A) shall evaluate the broadcast television
spectrum (including spectrum made available
through the reverse auction under subsection
(a)(1)); and
(B) may, subject to international
coordination along the border with Mexico and
Canada--
(i) make such reassignments of
television channels as the Commission
considers appropriate; and
(ii) reallocate such portions of
such spectrum as the Commission
determines are available for
reallocation.
(2) Factors for consideration.--In making any
reassignments or reallocations under paragraph (1)(B),
the Commission shall make all reasonable efforts to
preserve, as of the date of the enactment of this Act,
the coverage area and population served of each
broadcast television licensee, as determined using the
methodology described in OET Bulletin 69 of the Office
of Engineering and Technology of the Commission.
(3) No involuntary relocation from uhf to vhf.--In
making any reassignments under paragraph (1)(B)(i), the
Commission may not involuntarily reassign a broadcast
television licensee--
(A) from an ultra high frequency television
channel to a very high frequency television
channel; or
(B) from a television channel between the
frequencies from 174 megahertz to 216 megahertz
to a television channel between the frequencies
from 54 megahertz to 88 megahertz.
(4) Payment of relocation costs.--
(A) In general.--Except as provided in
subparagraph (B), from amounts made available
under subsection (d)(2), the Commission shall
reimburse costs reasonably incurred by--
(i) a broadcast television licensee
that was reassigned under paragraph
(1)(B)(i) from one ultra high frequency
television channel to a different ultra
high frequency television channel, from
one very high frequency television
channel to a different very high
frequency television channel, or, in
accordance with subsection (g)(1)(B),
from a very high frequency television
channel to an ultra high frequency
television channel, in order for the
licensee to relocate its television
service from one channel to the other;
(ii) a multichannel video
programming distributor in order to
continue to carry the signal of a
broadcast television licensee that--
(I) is described in clause
(i);
(II) voluntarily
relinquishes spectrum usage
rights under subsection (a)
with respect to an ultra high
frequency television channel in
return for receiving usage
rights with respect to a very
high frequency television
channel; or
(III) voluntarily
relinquishes spectrum usage
rights under subsection (a) to
share a television channel with
another licensee; or
(iii) a channel 37 incumbent user,
in order to relocate to other suitable
spectrum, provided that all such users
can be relocated and that the total
relocation costs of such users do not
exceed $300,000,000. For the purpose of
this section, the spectrum made
available through relocation of channel
37 incumbent users shall be deemed as
spectrum reclaimed through a reverse
auction under section 6403(a).
(B) Regulatory relief.--In lieu of
reimbursement for relocation costs under
subparagraph (A), a broadcast television
licensee may accept, and the Commission may
grant as it considers appropriate, a waiver of
the service rules of the Commission to permit
the licensee, subject to interference
protections, to make flexible use of the
spectrum assigned to the licensee to provide
services other than broadcast television
services. Such waiver shall only remain in
effect while the licensee provides at least 1
broadcast television program stream on such
spectrum at no charge to the public.
(C) Limitation.--The Commission may not
make reimbursements under subparagraph (A) for
lost revenues.
(D) Deadline.--The Commission shall make
all reimbursements required by subparagraph (A)
not later than the date that is 3 years after
the completion of the forward auction under
subsection (c)(1).
(5) Low-power television usage rights.--Nothing in
this subsection shall be construed to alter the
spectrum usage rights of low-power television stations.
(c) Forward Auction.--
(1) Auction required.--The Commission shall conduct
a forward auction in which--
(A) the Commission assigns licenses for the
use of the spectrum that the Commission
reallocates under subsection (b)(1)(B)(ii); and
(B) the amount of the proceeds that the
Commission shares under clause (i) of section
309(j)(8)(G) of the Communications Act of 1934
with each licensee whose bid the Commission
accepts in the reverse auction under subsection
(a)(1) is not less than the amount of such bid.
(2) Minimum proceeds.--
(A) In general.--If the amount of the
proceeds from the forward auction under
paragraph (1) is not greater than the sum
described in subparagraph (B), no licenses
shall be assigned through such forward auction,
no reassignments or reallocations under
subsection (b)(1)(B) shall become effective,
and the Commission may not revoke any spectrum
usage rights by reason of a bid that the
Commission accepts in the reverse auction under
subsection (a)(1).
(B) Sum described.--The sum described in
this subparagraph is the sum of--
(i) the total amount of
compensation that the Commission must
pay successful bidders in the reverse
auction under subsection (a)(1);
(ii) the costs of conducting such
forward auction that the salaries and
expenses account of the Commission is
required to retain under section
309(j)(8)(B) of the Communications Act
of 1934 (47 U.S.C. 309(j)(8)(B)); and
(iii) the estimated costs for which
the Commission is required to make
reimbursements under subsection
(b)(4)(A).
(C) Administrative costs.--The amount of
the proceeds from the forward auction under
paragraph (1) that the salaries and expenses
account of the Commission is required to retain
under section 309(j)(8)(B) of the
Communications Act of 1934 (47 U.S.C.
309(j)(8)(B)) shall be sufficient to cover the
costs incurred by the Commission in conducting
the reverse auction under subsection (a)(1),
conducting the evaluation of the broadcast
television spectrum under subparagraph (A) of
subsection (b)(1), and making any reassignments
or reallocations under subparagraph (B) of such
subsection, in addition to the costs incurred
by the Commission in conducting such forward
auction.
(3) Factor for consideration.--In conducting the
forward auction under paragraph (1), the Commission
shall consider assigning licenses that cover geographic
areas of a variety of different sizes.
(d) TV Broadcaster Relocation Fund.--
(1) Establishment.--There is established in the
Treasury of the United States a fund to be known as the
TV Broadcaster Relocation Fund.
(2) Payment of relocation costs.--Any amounts
borrowed under paragraph (3)(A) and any amounts in the
TV Broadcaster Relocation Fund that are not necessary
for reimbursement of the general fund of the Treasury
for such borrowed amounts shall be available to the
Commission to make the payments required by subsection
(b)(4)(A).
(3) Borrowing authority.--
(A) In general.--Beginning on the date when
any reassignments or reallocations under
subsection (b)(1)(B) become effective, as
provided in subsection (f)(2), and ending when
$1,000,000,000 has been deposited in the TV
Broadcaster Relocation Fund, the Commission may
borrow from the Treasury of the United States
an amount not to exceed $1,000,000,000 to use
toward the payments required by subsection
(b)(4)(A).
(B) Reimbursement.--The Commission shall
reimburse the general fund of the Treasury,
without interest, for any amounts borrowed
under subparagraph (A) as funds are deposited
into the TV Broadcaster Relocation Fund.
(4) Transfer of unused funds.--If any amounts
remain in the TV Broadcaster Relocation Fund after the
date that is 3 years after the completion of the
forward auction under subsection (c)(1), the Secretary
of the Treasury shall--
(A) prior to the end of fiscal year 2022,
transfer such amounts to the Public Safety
Trust Fund established by section 6413(a)(1);
and
(B) after the end of fiscal year 2022,
transfer such amounts to the general fund of
the Treasury, where such amounts shall be
dedicated for the sole purpose of deficit
reduction.
(e) Numerical Limitation on Auctions and Reorganization.--
The Commission may not complete more than one reverse auction
under subsection (a)(1) or more than one reorganization of the
broadcast television spectrum under subsection (b).
(f) Timing.--
(1) Contemporaneous auctions and reorganization
permitted.--The Commission may conduct the reverse
auction under subsection (a)(1), any reassignments or
reallocations under subsection (b)(1)(B), and the
forward auction under subsection (c)(1) on a
contemporaneous basis.
(2) Effectiveness of reassignments and
reallocations.--Notwithstanding paragraph (1), no
reassignments or reallocations under subsection
(b)(1)(B) shall become effective until the completion
of the reverse auction under subsection (a)(1) and the
forward auction under subsection (c)(1), and, to the
extent practicable, all such reassignments and
reallocations shall become effective simultaneously.
(3) Deadline.--The Commission may not conduct the
reverse auction under subsection (a)(1) or the forward
auction under subsection (c)(1) after the end of fiscal
year 2022.
(4) Limit on discretion regarding auction timing.--
Section 309(j)(15)(A) of the Communications Act of 1934
(47 U.S.C. 309(j)(15)(A)) shall not apply in the case
of an auction conducted under this section.
(g) Limitation on Reorganization Authority.--
(1) In general.--During the period described in
paragraph (2), the Commission may not--
(A) involuntarily modify the spectrum usage
rights of a broadcast television licensee or
reassign such a licensee to another television
channel except--
(i) in accordance with this
section; or
(ii) in the case of a violation by
such licensee of the terms of its
license or a specific provision of a
statute administered by the Commission,
or a regulation of the Commission
promulgated under any such provision;
or
(B) reassign a broadcast television
licensee from a very high frequency television
channel to an ultra high frequency television
channel, unless--
(i) such a reassignment will not
decrease the total amount of ultra high
frequency spectrum made available for
reallocation under this section; or
(ii) a request from such licensee
for the reassignment was pending at the
Commission on May 31, 2011.
(2) Period described.--The period described in this
paragraph is the period beginning on the date of the
enactment of this Act and ending on the earliest of--
(A) the first date when the reverse auction
under subsection (a)(1), the reassignments and
reallocations (if any) under subsection
(b)(1)(B), and the forward auction under
subsection (c)(1) have been completed;
(B) the date of a determination by the
Commission that the amount of the proceeds from
the forward auction under subsection (c)(1) is
not greater than the sum described in
subsection (c)(2)(B); or
(C) September 30, 2022.
(h) Protest Right Inapplicable.--The right of a licensee to
protest a proposed order of modification of its license under
section 316 of the Communications Act of 1934 (47 U.S.C. 316)
shall not apply in the case of a modification made under this
section.
(i) Commission Authority.--Nothing in subsection (b) shall
be construed to--
(1) expand or contract the authority of the
Commission, except as otherwise expressly provided; or
(2) prevent the implementation of the Commission's
``White Spaces'' Second Report and Order and Memorandum
Opinion and Order (FCC 08-260, adopted November 4,
2008) in the spectrum that remains allocated for
broadcast television use after the reorganization
required by such subsection.
SEC. 6404. CERTAIN CONDITIONS ON AUCTION PARTICIPATION PROHIBITED.
Section 309(j) of the Communications Act of 1934 (47 U.S.C.
309(j)) is amended by adding at the end the following new
paragraph:
``(17) Certain conditions on auction participation
prohibited.--
``(A) In general.--Notwithstanding any
other provision of law, the Commission may not
prevent a person from participating in a system
of competitive bidding under this subsection if
such person--
``(i) complies with all the auction
procedures and other requirements to
protect the auction process established
by the Commission; and
``(ii) either--
``(I) meets the technical,
financial, character, and
citizenship qualifications that
the Commission may require
under section 303(l)(1),
308(b), or 310 to hold a
license; or
``(II) would meet such
license qualifications by means
approved by the Commission
prior to the grant of the
license.
``(B) Clarification of authority.--Nothing
in subparagraph (A) affects any authority the
Commission has to adopt and enforce rules of
general applicability, including rules
concerning spectrum aggregation that promote
competition.''.
SEC. 6405. EXTENSION OF AUCTION AUTHORITY.
Section 309(j)(11) of the Communications Act of 1934 (47
U.S.C. 309(j)(11)) is amended by striking ``2012'' and
inserting ``2022''.
SEC. 6406. UNLICENSED USE IN THE 5 GHZ BAND.
(a) Modification of Commission Regulations To Allow Certain
Unlicensed Use.--
(1) In general.--Subject to paragraph (2), not
later than 1 year after the date of the enactment of
this Act, the Commission shall begin a proceeding to
modify part 15 of title 47, Code of Federal
Regulations, to allow unlicensed U-NII devices to
operate in the 5350-5470 MHz band.
(2) Required determinations.--The Commission may
make the modification described in paragraph (1) only
if the Commission, in consultation with the Assistant
Secretary, determines that--
(A) licensed users will be protected by
technical solutions, including use of existing,
modified, or new spectrum-sharing technologies
and solutions, such as dynamic frequency
selection; and
(B) the primary mission of Federal spectrum
users in the 5350-5470 MHz band will not be
compromised by the introduction of unlicensed
devices.
(b) Study by NTIA.--
(1) In general.--The Assistant Secretary, in
consultation with the Department of Defense and other
impacted agencies, shall conduct a study evaluating
known and proposed spectrum-sharing technologies and
the risk to Federal users if unlicensed U-NII devices
were allowed to operate in the 5350-5470 MHz band and
in the 5850-5925 MHz band.
(2) Submission.--The Assistant Secretary shall
submit to the Commission and the Committee on Energy
and Commerce of the House of Representatives and the
Committee on Commerce, Science, and Transportation of
the Senate--
(A) not later than 8 months after the date
of the enactment of this Act, a report on the
portion of the study required by paragraph (1)
with respect to the 5350-5470 MHz band; and
(B) not later than 18 months after the date
of the enactment of this Act, a report on the
portion of the study required by paragraph (1)
with respect to the 5850-5925 MHz band.
(c) Definitions.--In this section:
(1) 5350-5470 mhz band.--The term ``5350-5470 MHz
band'' means the portion of the electromagnetic
spectrum between the frequencies from 5350 megahertz to
5470 megahertz.
(2) 5850-5925 mhz band.--The term ``5850-5925 MHz
band'' means the portion of the electromagnetic
spectrum between the frequencies from 5850 megahertz to
5925 megahertz.
SEC. 6407. GUARD BANDS AND UNLICENSED USE.
(a) In General.--Nothing in subparagraph (G) of section
309(j)(8) of the Communications Act of 1934, as added by
section 6402, or in section 6403 shall be construed to prevent
the Commission from using relinquished or other spectrum to
implement band plans with guard bands.
(b) Size of Guard Bands.--Such guard bands shall be no
larger than is technically reasonable to prevent harmful
interference between licensed services outside the guard bands.
(c) Unlicensed Use in Guard Bands.--The Commission may
permit the use of such guard bands for unlicensed use.
(d) Database.--Unlicensed use shall rely on a database or
subsequent methodology as determined by the Commission.
(e) Protections Against Harmful Interference.--The
Commission may not permit any use of a guard band that the
Commission determines would cause harmful interference to
licensed services.
SEC. 6408. STUDY ON RECEIVER PERFORMANCE AND SPECTRUM EFFICIENCY.
(a) In General.--The Comptroller General of the United
States shall conduct a study to consider efforts to ensure that
each transmission system is designed and operated so that
reasonable use of adjacent spectrum does not excessively impair
the functioning of such system.
(b) Required Considerations.--In conducting the study
required by subsection (a), the Comptroller General shall
consider--
(1) the value of--
(A) improving receiver performance as it
relates to increasing spectral efficiency;
(B) improving the operation of services
that are located in adjacent spectrum; and
(C) narrowing the guard bands between
adjacent spectrum use;
(2) the role of manufacturers, commercial
licensees, and government users with respect to their
transmission systems and the use of adjacent spectrum;
(3) the feasibility of industry self-compliance
with respect to the design and operational requirements
of transmission systems and the reasonable use of
adjacent spectrum; and
(4) the value of action by the Commission and the
Assistant Secretary to establish, by rule, technical
requirements or standards for non-Federal and Federal
use, respectively, with respect to the reasonable use
of portions of the radio spectrum that are adjacent to
each other.
(c) Report.--Not later than 1 year after the date of the
enactment of this Act, the Comptroller General shall submit a
report on the results of the study required by subsection (a)
to the Committee on Energy and Commerce of the House of
Representatives and the Committee on Commerce, Science, and
Transportation of the Senate.
(d) Transmission System Defined.--In this section, the term
``transmission system'' means any telecommunications,
broadcast, satellite, commercial mobile service, or other
communications system that employs radio spectrum.
SEC. 6409. WIRELESS FACILITIES DEPLOYMENT.
(a) Facility Modifications.--
(1) In general.--Notwithstanding section 704 of the
Telecommunications Act of 1996 (Public Law 104-104) or
any other provision of law, a State or local government
may not deny, and shall approve, any eligible
facilities request for a modification of an existing
wireless tower or base station that does not
substantially change the physical dimensions of such
tower or base station.
(2) Eligible facilities request.--For purposes of
this subsection, the term ``eligible facilities
request'' means any request for modification of an
existing wireless tower or base station that involves--
(A) collocation of new transmission
equipment;
(B) removal of transmission equipment; or
(C) replacement of transmission equipment.
(3) Applicability of environmental laws.--Nothing
in paragraph (1) shall be construed to relieve the
Commission from the requirements of the National
Historic Preservation Act or the National Environmental
Policy Act of 1969.
(b) Federal Easements and Rights-of-way.--
(1) Grant.--If an executive agency, a State, a
political subdivision or agency of a State, or a
person, firm, or organization applies for the grant of
an easement or right-of-way to, in, over, or on a
building or other property owned by the Federal
Government for the right to install, construct, and
maintain wireless service antenna structures and
equipment and backhaul transmission equipment, the
executive agency having control of the building or
other property may grant to the applicant, on behalf of
the Federal Government, an easement or right-of-way to
perform such installation, construction, and
maintenance.
(2) Application.--The Administrator of General
Services shall develop a common form for applications
for easements and rights-of-way under paragraph (1) for
all executive agencies that shall be used by applicants
with respect to the buildings or other property of each
such agency.
(3) Fee.--
(A) In general.--Notwithstanding any other
provision of law, the Administrator of General
Services shall establish a fee for the grant of
an easement or right-of-way pursuant to
paragraph (1) that is based on direct cost
recovery.
(B) Exceptions.--The Administrator of
General Services may establish exceptions to
the fee amount required under subparagraph
(A)--
(i) in consideration of the public
benefit provided by a grant of an
easement or right-of-way; and
(ii) in the interest of expanding
wireless and broadband coverage.
(4) Use of fees collected.--Any fee amounts
collected by an executive agency pursuant to paragraph
(3) may be made available, as provided in
appropriations Acts, to such agency to cover the costs
of granting the easement or right-of-way.
(c) Master Contracts for Wireless Facility Sitings.--
(1) In general.--Notwithstanding section 704 of the
Telecommunications Act of 1996 or any other provision
of law, and not later than 60 days after the date of
the enactment of this Act, the Administrator of General
Services shall--
(A) develop 1 or more master contracts that
shall govern the placement of wireless service
antenna structures on buildings and other
property owned by the Federal Government; and
(B) in developing the master contract or
contracts, standardize the treatment of the
placement of wireless service antenna
structures on building rooftops or facades, the
placement of wireless service antenna equipment
on rooftops or inside buildings, the technology
used in connection with wireless service
antenna structures or equipment placed on
Federal buildings and other property, and any
other key issues the Administrator of General
Services considers appropriate.
(2) Applicability.--The master contract or
contracts developed by the Administrator of General
Services under paragraph (1) shall apply to all
publicly accessible buildings and other property owned
by the Federal Government, unless the Administrator of
General Services decides that issues with respect to
the siting of a wireless service antenna structure on a
specific building or other property warrant nonstandard
treatment of such building or other property.
(3) Application.--The Administrator of General
Services shall develop a common form or set of forms
for wireless service antenna structure siting
applications under this subsection for all executive
agencies that shall be used by applicants with respect
to the buildings and other property of each such
agency.
(d) Executive Agency Defined.--In this section, the term
``executive agency'' has the meaning given such term in section
102 of title 40, United States Code.
SEC. 6410. FUNCTIONAL RESPONSIBILITY OF NTIA TO ENSURE EFFICIENT USE OF
SPECTRUM.
Section 103(b)(2) of the National Telecommunications and
Information Administration Organization Act (47 U.S.C.
902(b)(2)) is amended by adding at the end the following:
``(U) The responsibility to promote the
best possible and most efficient use of
electromagnetic spectrum resources across the
Federal Government, subject to and consistent
with the needs and missions of Federal
agencies.''.
SEC. 6411. SYSTEM CERTIFICATION.
Not later than 6 months after the date of the enactment of
this Act, the Director of the Office of Management and Budget
shall update and revise section 33.4 of OMB Circular A-11 to
reflect the recommendations regarding such Circular made in the
Commerce Spectrum Management Advisory Committee Incentive
Subcommittee report, adopted January 11, 2011.
SEC. 6412. DEPLOYMENT OF 11 GHZ, 18 GHZ, AND 23 GHZ MICROWAVE BANDS.
(a) FCC Report on Rejection Rate.--Not later than 9 months
after the date of the enactment of this Act, the Commission
shall submit to the Committee on Energy and Commerce of the
House of Representatives and the Committee on Commerce,
Science, and Transportation of the Senate a report on the
rejection rate for the spectrum described in subsection (c).
(b) GAO Study on Deployment.--
(1) In general.--The Comptroller General of the
United States shall conduct a study to assess whether
the spectrum described in subsection (c) is being
deployed in such a manner that, in areas with high
demand for common carrier licenses for the use of such
spectrum, market forces--
(A) provide adequate incentive for the
efficient use of such spectrum; and
(B) ensure that the Federal Government
receives maximum revenue for such spectrum
through competitive bidding under section
309(j) of the Communications Act of 1934 (47
U.S.C. 309(j)).
(2) Factors for consideration.--In conducting the
study required by paragraph (1), the Comptroller
General shall take into consideration--
(A) spectrum that is adjacent to the
spectrum described in subsection (c) and that
was assigned through competitive bidding under
section 309(j) of the Communications Act of
1934; and
(B) the rejection rate for the spectrum
described in subsection (c), current as of the
time of the assessment and as projected for the
future, in markets in which there is a high
demand for common carrier licenses for the use
of such spectrum.
(3) Report.--Not later than 9 months after the date
of the enactment of this Act, the Comptroller General
shall submit a report on the study required by
paragraph (1) to--
(A) the Commission; and
(B) the Committee on Energy and Commerce of
the House of Representatives and the Committee
on Commerce, Science, and Transportation of the
Senate.
(c) Spectrum Described.--The spectrum described in this
subsection is the portions of the electromagnetic spectrum
between the frequencies from 10,700 megahertz to 11,700
megahertz, from 17,700 megahertz to 19,700 megahertz, and from
21,200 megahertz to 23,600 megahertz.
(d) Rejection Rate Defined.--In this section, the term
``rejection rate'' means the number and percent of applications
(whether made to the Commission or to a third-party
coordinator) for common carrier use of spectrum that were not
granted because of lack of availability of such spectrum or
interference concerns of existing licensees.
(e) No Additional Funds Authorized.--Funds necessary to
carry out this section shall be derived from funds otherwise
authorized to be appropriated.
SEC. 6413. PUBLIC SAFETY TRUST FUND.
(a) Establishment of Public Safety Trust Fund.--
(1) In general.--There is established in the
Treasury of the United States a trust fund to be known
as the Public Safety Trust Fund.
(2) Availability.--Amounts deposited in the Public
Safety Trust Fund shall remain available through fiscal
year 2022. Any amounts remaining in the Fund after the
end of such fiscal year shall be deposited in the
general fund of the Treasury, where such amounts shall
be dedicated for the sole purpose of deficit reduction.
(b) Use of Fund.--As amounts are deposited in the Public
Safety Trust Fund, such amounts shall be used to make the
following deposits or payments in the following order of
priority:
(1) Repayment of amount borrowed for first
responder network authority.--An amount not to exceed
$2,000,000,000 shall be available to the NTIA to
reimburse the general fund of the Treasury for any
amounts borrowed under section 6207.
(2) State and local implementation fund.--
$135,000,000 shall be deposited in the State and Local
Implementation Fund established by section 6301.
(3) Buildout by first responder network
authority.--$7,000,000,000, reduced by the amount
borrowed under section 6207, shall be deposited in the
Network Construction Fund established by section 6206.
(4) Public safety research.--$100,000,000 shall be
available to the Director of NIST to carry out section
6303.
(5) Deficit reduction.--$20,400,000,000 shall be
deposited in the general fund of the Treasury, where
such amount shall be dedicated for the sole purpose of
deficit reduction.
(6) 9-1-1, e9-1-1, and next generation 9-1-1
implementation grants.--$115,000,000 shall be available
to the Assistant Secretary and the Administrator of the
National Highway Traffic Safety Administration to carry
out the grant program under section 158 of the National
Telecommunications and Information Administration
Organization Act, as amended by section 6503 of this
title.
(7) Additional public safety research.--
$200,000,000 shall be available to the Director of NIST
to carry out section 6303.
(8) Additional deficit reduction.--Any remaining
amounts deposited in the Public Safety Trust Fund shall
be deposited in the general fund of the Treasury, where
such amounts shall be dedicated for the sole purpose of
deficit reduction.
(c) Investment.--Amounts in the Public Safety Trust Fund
shall be invested in accordance with section 9702 of title 31,
United States Code, and any interest on, and proceeds from, any
such investment shall be credited to, and become a part of, the
Fund.
SEC. 6414. STUDY ON EMERGENCY COMMUNICATIONS BY AMATEUR RADIO AND
IMPEDIMENTS TO AMATEUR RADIO COMMUNICATIONS.
(a) In General.--Not later than 180 days after the date of
the enactment of this Act, the Commission, in consultation with
the Office of Emergency Communications in the Department of
Homeland Security, shall--
(1) complete a study on the uses and capabilities
of amateur radio service communications in emergencies
and disaster relief; and
(2) submit to the Committee on Energy and Commerce
of the House of Representatives and the Committee on
Commerce, Science, and Transportation of the Senate a
report on the findings of such study.
(b) Contents.--The study required by subsection (a) shall
include--
(1)(A) a review of the importance of emergency
amateur radio service communications relating to
disasters, severe weather, and other threats to lives
and property in the United States; and
(B) recommendations for--
(i) enhancements in the voluntary
deployment of amateur radio operators in
disaster and emergency communications and
disaster relief efforts; and
(ii) improved integration of amateur radio
operators in the planning and furtherance of
initiatives of the Federal Government; and
(2)(A) an identification of impediments to enhanced
amateur radio service communications, such as the
effects of unreasonable or unnecessary private land use
restrictions on residential antenna installations; and
(B) recommendations regarding the removal of such
impediments.
(c) Expertise.--In conducting the study required by
subsection (a), the Commission shall use the expertise of
stakeholder entities and organizations, including the amateur
radio, emergency response, and disaster communications
communities.
Subtitle E--Next Generation 9-1-1 Advancement Act of 2012
SEC. 6501. SHORT TITLE.
This subtitle may be cited as the ``Next Generation 9-1-1
Advancement Act of 2012''.
SEC. 6502. DEFINITIONS.
In this subtitle, the following definitions shall apply:
(1) 9-1-1 services and e9-1-1 services.--The terms
``9-1-1 services'' and ``E9-1-1 services'' shall have
the meaning given those terms in section 158 of the
National Telecommunications and Information
Administration Organization Act (47 U.S.C. 942), as
amended by this subtitle.
(2) Multi-line telephone system.--The term ``multi-
line telephone system'' or ``MLTS'' means a system
comprised of common control units, telephone sets,
control hardware and software and adjunct systems,
including network and premises based systems, such as
Centrex and VoIP, as well as PBX, Hybrid, and Key
Telephone Systems (as classified by the Commission
under part 68 of title 47, Code of Federal
Regulations), and includes systems owned or leased by
governmental agencies and non-profit entities, as well
as for profit businesses.
(3) Office.--The term ``Office'' means the 9-1-1
Implementation Coordination Office established under
section 158 of the National Telecommunications and
Information Administration Organization Act (47 U.S.C.
942), as amended by this subtitle.
SEC. 6503. COORDINATION OF 9-1-1 IMPLEMENTATION.
Section 158 of the National Telecommunications and
Information Administration Organization Act (47 U.S.C. 942) is
amended to read as follows:
``SEC. 158. COORDINATION OF 9-1-1, E9-1-1, AND NEXT GENERATION 9-1-1
IMPLEMENTATION.
``(a) 9-1-1 Implementation Coordination Office.--
``(1) Establishment and continuation.--The
Assistant Secretary and the Administrator of the
National Highway Traffic Safety Administration shall--
``(A) establish and further a program to
facilitate coordination and communication
between Federal, State, and local emergency
communications systems, emergency personnel,
public safety organizations, telecommunications
carriers, and telecommunications equipment
manufacturers and vendors involved in the
implementation of 9-1-1 services; and
``(B) establish a 9-1-1 Implementation
Coordination Office to implement the provisions
of this section.
``(2) Management plan.--
``(A) Development.--The Assistant Secretary
and the Administrator shall develop a
management plan for the grant program
established under this section, including by
developing--
``(i) plans related to the
organizational structure of such
program; and
``(ii) funding profiles for each
fiscal year of the duration of such
program.
``(B) Submission to congress.--Not later
than 90 days after the date of enactment of the
Next Generation 9-1-1 Advancement Act of 2012,
the Assistant Secretary and the Administrator
shall submit the management plan developed
under subparagraph (A) to--
``(i) the Committees on Commerce,
Science, and Transportation and
Appropriations of the Senate; and
``(ii) the Committees on Energy and
Commerce and Appropriations of the
House of Representatives.
``(3) Purpose of office.--The Office shall--
``(A) take actions, in concert with
coordinators designated in accordance with
subsection (b)(3)(A)(ii), to improve
coordination and communication with respect to
the implementation of 9-1-1 services, E9-1-1
services, and Next Generation 9-1-1 services;
``(B) develop, collect, and disseminate
information concerning practices, procedures,
and technology used in the implementation of 9-
1-1 services, E9-1-1 services, and Next
Generation 9-1-1 services;
``(C) advise and assist eligible entities
in the preparation of implementation plans
required under subsection (b)(3)(A)(iii);
``(D) receive, review, and recommend the
approval or disapproval of applications for
grants under subsection (b); and
``(E) oversee the use of funds provided by
such grants in fulfilling such implementation
plans.
``(4) Reports.--The Assistant Secretary and the
Administrator shall provide an annual report to
Congress by the first day of October of each year on
the activities of the Office to improve coordination
and communication with respect to the implementation of
9-1-1 services, E9-1-1 services, and Next Generation 9-
1-1 services.
``(b) 9-1-1, E9-1-1, and Next Generation 9-1-1
Implementation Grants.--
``(1) Matching grants.--The Assistant Secretary and
the Administrator, acting through the Office, shall
provide grants to eligible entities for--
``(A) the implementation and operation of
9-1-1 services, E9-1-1 services, migration to
an IP-enabled emergency network, and adoption
and operation of Next Generation 9-1-1 services
and applications;
``(B) the implementation of IP-enabled
emergency services and applications enabled by
Next Generation 9-1-1 services, including the
establishment of IP backbone networks and the
application layer software infrastructure
needed to interconnect the multitude of
emergency response organizations; and
``(C) training public safety personnel,
including call-takers, first responders, and
other individuals and organizations who are
part of the emergency response chain in 9-1-1
services.
``(2) Matching requirement.--The Federal share of
the cost of a project eligible for a grant under this
section shall not exceed 60 percent.
``(3) Coordination required.--In providing grants
under paragraph (1), the Assistant Secretary and the
Administrator shall require an eligible entity to
certify in its application that--
``(A) in the case of an eligible entity
that is a State government, the entity--
``(i) has coordinated its
application with the public safety
answering points located within the
jurisdiction of such entity;
``(ii) has designated a single
officer or governmental body of the
entity to serve as the coordinator of
implementation of 9-1-1 services,
except that such designation need not
vest such coordinator with direct legal
authority to implement 9-1-1 services,
E9-1-1 services, or Next Generation 9-
1-1 services or to manage emergency
communications operations;
``(iii) has established a plan for
the coordination and implementation of
9-1-1 services, E9-1-1 services, and
Next Generation 9-1-1 services; and
``(iv) has integrated
telecommunications services involved in
the implementation and delivery of 9-1-
1 services, E9-1-1 services, and Next
Generation 9-1-1 services; or
``(B) in the case of an eligible entity
that is not a State, the entity has complied
with clauses (i), (iii), and (iv) of
subparagraph (A), and the State in which it is
located has complied with clause (ii) of such
subparagraph.
``(4) Criteria.--Not later than 120 days after the
date of enactment of the Next Generation 9-1-1
Advancement Act of 2012, the Assistant Secretary and
the Administrator shall issue regulations, after
providing the public with notice and an opportunity to
comment, prescribing the criteria for selection for
grants under this section. The criteria shall include
performance requirements and a timeline for completion
of any project to be financed by a grant under this
section. The Assistant Secretary and the Administrator
shall update such regulations as necessary.
``(c) Diversion of 9-1-1 Charges.--
``(1) Designated 9-1-1 charges.--For the purposes
of this subsection, the term `designated 9-1-1 charges'
means any taxes, fees, or other charges imposed by a
State or other taxing jurisdiction that are designated
or presented as dedicated to deliver or improve 9-1-1
services, E9-1-1 services, or Next Generation 9-1-1
services.
``(2) Certification.--Each applicant for a matching
grant under this section shall certify to the Assistant
Secretary and the Administrator at the time of
application, and each applicant that receives such a
grant shall certify to the Assistant Secretary and the
Administrator annually thereafter during any period of
time during which the funds from the grant are
available to the applicant, that no portion of any
designated 9-1-1 charges imposed by a State or other
taxing jurisdiction within which the applicant is
located are being obligated or expended for any purpose
other than the purposes for which such charges are
designated or presented during the period beginning 180
days immediately preceding the date of the application
and continuing through the period of time during which
the funds from the grant are available to the
applicant.
``(3) Condition of grant.--Each applicant for a
grant under this section shall agree, as a condition of
receipt of the grant, that if the State or other taxing
jurisdiction within which the applicant is located,
during any period of time during which the funds from
the grant are available to the applicant, obligates or
expends designated 9-1-1 charges for any purpose other
than the purposes for which such charges are designated
or presented, eliminates such charges, or redesignates
such charges for purposes other than the implementation
or operation of 9-1-1 services, E9-1-1 services, or
Next Generation 9-1-1 services, all of the funds from
such grant shall be returned to the Office.
``(4) Penalty for providing false information.--Any
applicant that provides a certification under paragraph
(2) knowing that the information provided in the
certification was false shall--
``(A) not be eligible to receive the grant
under subsection (b);
``(B) return any grant awarded under
subsection (b) during the time that the
certification was not valid; and
``(C) not be eligible to receive any
subsequent grants under subsection (b).
``(d) Funding and Termination.--
``(1) In general.--From the amounts made available
to the Assistant Secretary and the Administrator under
section 6413(b)(6) of the Middle Class Tax Relief and
Job Creation Act of 2012, the Assistant Secretary and
the Administrator are authorized to provide grants
under this section through the end of fiscal year 2022.
Not more than 5 percent of such amounts may be
obligated or expended to cover the administrative costs
of carrying out this section.
``(2) Termination.--Effective on October 1, 2022,
the authority provided by this section terminates and
this section shall have no effect.
``(e) Definitions.--In this section, the following
definitions shall apply:
``(1) 9-1-1 services.--The term `9-1-1 services'
includes both E9-1-1 services and Next Generation 9-1-1
services.
``(2) E9-1-1 services.--The term `E9-1-1 services'
means both phase I and phase II enhanced 9-1-1
services, as described in section 20.18 of the
Commission's regulations (47 C.F.R. 20.18), as in
effect on the date of enactment of the Next Generation
9-1-1 Advancement Act of 2012, or as subsequently
revised by the Commission.
``(3) Eligible entity.--
``(A) In general.--The term `eligible
entity' means a State or local government or a
tribal organization (as defined in section 4(l)
of the Indian Self-Determination and Education
Assistance Act (25 U.S.C. 450b(l))).
``(B) Instrumentalities.--The term
`eligible entity' includes public authorities,
boards, commissions, and similar bodies created
by one or more eligible entities described in
subparagraph (A) to provide 9-1-1 services, E9-
1-1 services, or Next Generation 9-1-1
services.
``(C) Exception.--The term `eligible
entity' does not include any entity that has
failed to submit the most recently required
certification under subsection (c) within 30
days after the date on which such certification
is due.
``(4) Emergency call.--The term `emergency call'
refers to any real-time communication with a public
safety answering point or other emergency management or
response agency, including--
``(A) through voice, text, or video and
related data; and
``(B) nonhuman-initiated automatic event
alerts, such as alarms, telematics, or sensor
data, which may also include real-time voice,
text, or video communications.
``(5) Next generation 9-1-1 services.--The term
`Next Generation 9-1-1 services' means an IP-based
system comprised of hardware, software, data, and
operational policies and procedures that--
``(A) provides standardized interfaces from
emergency call and message services to support
emergency communications;
``(B) processes all types of emergency
calls, including voice, data, and multimedia
information;
``(C) acquires and integrates additional
emergency call data useful to call routing and
handling;
``(D) delivers the emergency calls,
messages, and data to the appropriate public
safety answering point and other appropriate
emergency entities;
``(E) supports data or video communications
needs for coordinated incident response and
management; and
``(F) provides broadband service to public
safety answering points or other first
responder entities.
``(6) Office.--The term `Office' means the 9-1-1
Implementation Coordination Office.
``(7) Public safety answering point.--The term
`public safety answering point' has the meaning given
the term in section 222 of the Communications Act of
1934 (47 U.S.C. 222).
``(8) State.--The term `State' means any State of
the United States, the District of Columbia, Puerto
Rico, American Samoa, Guam, the United States Virgin
Islands, the Northern Mariana Islands, and any other
territory or possession of the United States.''.
SEC. 6504. REQUIREMENTS FOR MULTI-LINE TELEPHONE SYSTEMS.
(a) In General.--Not later than 270 days after the date of
the enactment of this Act, the Administrator of General
Services, in conjunction with the Office, shall issue a report
to Congress identifying the 9-1-1 capabilities of the multi-
line telephone system in use by all Federal agencies in all
Federal buildings and properties.
(b) Commission Action.--
(1) In general.--Not later than 90 days after the
date of the enactment of this Act, the Commission shall
issue a public notice seeking comment on the
feasibility of MLTS manufacturers including within all
such systems manufactured or sold after a date certain,
to be determined by the Commission, one or more
mechanisms to provide a sufficiently precise indication
of a 9-1-1 caller's location, while avoiding the
imposition of undue burdens on MLTS manufacturers,
providers, and operators.
(2) Specific requirement.--The public notice under
paragraph (1) shall seek comment on the National
Emergency Number Association's ``Technical Requirements
Document On Model Legislation E9-1-1 for Multi-Line
Telephone Systems'' (NENA 06-750, Version 2).
SEC. 6505. GAO STUDY OF STATE AND LOCAL USE OF 9-1-1 SERVICE CHARGES.
(a) In General.--Not later than 60 days after the date of
the enactment of this Act, the Comptroller General of the
United States shall initiate a study of--
(1) the imposition of taxes, fees, or other charges
imposed by States or political subdivisions of States
that are designated or presented as dedicated to
improve emergency communications services, including 9-
1-1 services or enhanced 9-1-1 services, or related to
emergency communications services operations or
improvements; and
(2) the use of revenues derived from such taxes,
fees, or charges.
(b) Report.--Not later than 18 months after initiating the
study required by subsection (a), the Comptroller General shall
prepare and submit a report on the results of the study to the
Committee on Commerce, Science, and Transportation of the
Senate and the Committee on Energy and Commerce of the House of
Representatives setting forth the findings, conclusions, and
recommendations, if any, of the study, including--
(1) the identity of each State or political
subdivision that imposes such taxes, fees, or other
charges; and
(2) the amount of revenues obligated or expended by
that State or political subdivision for any purpose
other than the purposes for which such taxes, fees, or
charges were designated or presented.
SEC. 6506. PARITY OF PROTECTION FOR PROVISION OR USE OF NEXT GENERATION
9-1-1 SERVICES.
(a) Immunity.--A provider or user of Next Generation 9-1-1
services, a public safety answering point, and the officers,
directors, employees, vendors, agents, and authorizing
government entity (if any) of such provider, user, or public
safety answering point, shall have immunity and protection from
liability under Federal and State law to the extent provided in
subsection (b) with respect to--
(1) the release of subscriber information related
to emergency calls or emergency services;
(2) the use or provision of 9-1-1 services, E9-1-1
services, or Next Generation 9-1-1 services; and
(3) other matters related to 9-1-1 services, E9-1-1
services, or Next Generation 9-1-1 services.
(b) Scope of Immunity and Protection From Liability.--The
scope and extent of the immunity and protection from liability
afforded under subsection (a) shall be the same as that
provided under section 4 of the Wireless Communications and
Public Safety Act of 1999 (47 U.S.C. 615a) to wireless
carriers, public safety answering points, and users of wireless
9-1-1 service (as defined in paragraphs (4), (3), and (6),
respectively, of section 6 of that Act (47 U.S.C. 615b)) with
respect to such release, use, and other matters.
SEC. 6507. COMMISSION PROCEEDING ON AUTODIALING.
(a) In General.--Not later than 90 days after the date of
the enactment of this Act, the Commission shall initiate a
proceeding to create a specialized Do-Not-Call registry for
public safety answering points.
(b) Features of the Registry.--The Commission shall issue
regulations, after providing the public with notice and an
opportunity to comment, that--
(1) permit verified public safety answering point
administrators or managers to register the telephone
numbers of all 9-1-1 trunks and other lines used for
the provision of emergency services to the public or
for communications between public safety agencies;
(2) provide a process for verifying, no less
frequently than once every 7 years, that registered
numbers should continue to appear upon the registry;
(3) provide a process for granting and tracking
access to the registry by the operators of automatic
dialing equipment;
(4) protect the list of registered numbers from
disclosure or dissemination by parties granted access
to the registry; and
(5) prohibit the use of automatic dialing or
``robocall'' equipment to establish contact with
registered numbers.
(c) Enforcement.--The Commission shall--
(1) establish monetary penalties for violations of
the protective regulations established pursuant to
subsection (b)(4) of not less than $100,000 per
incident nor more than $1,000,000 per incident;
(2) establish monetary penalties for violations of
the prohibition on automatically dialing registered
numbers established pursuant to subsection (b)(5) of
not less than $10,000 per call nor more than $100,000
per call; and
(3) provide for the imposition of fines under
paragraphs (1) or (2) that vary depending upon whether
the conduct leading to the violation was negligent,
grossly negligent, reckless, or willful, and depending
on whether the violation was a first or subsequent
offence.
SEC. 6508. REPORT ON COSTS FOR REQUIREMENTS AND SPECIFICATIONS OF NEXT
GENERATION 9-1-1 SERVICES.
(a) In General.--Not later than 1 year after the date of
the enactment of this Act, the Office, in consultation with the
Administrator of the National Highway Traffic Safety
Administration, the Commission, and the Secretary of Homeland
Security, shall prepare and submit a report to Congress that
analyzes and determines detailed costs for specific Next
Generation 9-1-1 service requirements and specifications.
(b) Purpose of Report.--The purpose of the report required
under subsection (a) is to serve as a resource for Congress as
it considers creating a coordinated, long-term funding
mechanism for the deployment and operation, accessibility,
application development, equipment procurement, and training of
personnel for Next Generation 9-1-1 services.
(c) Required Inclusions.--The report required under
subsection (a) shall include the following:
(1) How costs would be broken out geographically
and allocated among public safety answering points,
broadband service providers, and third-party providers
of Next Generation 9-1-1 services.
(2) An assessment of the current state of Next
Generation 9-1-1 service readiness among public safety
answering points.
(3) How differences in public safety answering
points' access to broadband across the United States
may affect costs.
(4) A technical analysis and cost study of
different delivery platforms, such as wireline,
wireless, and satellite.
(5) An assessment of the architectural
characteristics, feasibility, and limitations of Next
Generation 9-1-1 service delivery.
(6) An analysis of the needs for Next Generation 9-
1-1 services of persons with disabilities.
(7) Standards and protocols for Next Generation 9-
1-1 services and for incorporating Voice over Internet
Protocol and ``Real-Time Text'' standards.
SEC. 6509. COMMISSION RECOMMENDATIONS FOR LEGAL AND STATUTORY FRAMEWORK
FOR NEXT GENERATION 9-1-1 SERVICES.
Not later than 1 year after the date of the enactment of
this Act, the Commission, in coordination with the Secretary of
Homeland Security, the Administrator of the National Highway
Traffic Safety Administration, and the Office, shall prepare
and submit a report to Congress that contains recommendations
for the legal and statutory framework for Next Generation 9-1-1
services, consistent with recommendations in the National
Broadband Plan developed by the Commission pursuant to the
American Recovery and Reinvestment Act of 2009, including the
following:
(1) A legal and regulatory framework for the
development of Next Generation 9-1-1 services and the
transition from legacy 9-1-1 to Next Generation 9-1-1
networks.
(2) Legal mechanisms to ensure efficient and
accurate transmission of 9-1-1 caller information to
emergency response agencies.
(3) Recommendations for removing jurisdictional
barriers and inconsistent legacy regulations
including--
(A) proposals that would require States to
remove regulatory roadblocks to Next Generation
9-1-1 services development, while recognizing
existing State authority over 9-1-1 services;
(B) eliminating outdated 9-1-1 regulations
at the Federal level; and
(C) preempting inconsistent State
regulations.
Subtitle F--Telecommunications Development Fund
SEC. 6601. NO ADDITIONAL FEDERAL FUNDS.
Section 309(j)(8)(C)(iii) of the Communications Act of 1934
(47 U.S.C. 309(j)(8)(C)(iii)) is amended to read as follows:
``(iii) the interest accrued to the
account shall be deposited in the
general fund of the Treasury, where
such amount shall be dedicated for the
sole purpose of deficit reduction.''.
SEC. 6602. INDEPENDENCE OF THE FUND.
Section 714 of the Communications Act of 1934 (47 U.S.C.
614) is amended--
(1) by striking subsection (c) and inserting the
following:
``(c) Independent Board of Directors.--The Fund shall have
a Board of Directors consisting of 5 people with experience in
areas including finance, investment banking, government
banking, communications law and administrative practice, and
public policy. The Board of Directors shall select annually a
Chair from among the directors. A nominating committee,
comprised of the Chair and 2 other directors selected by the
Chair, shall appoint additional directors. The Fund's bylaws
shall regulate the other aspects of the Board of Directors,
including provisions relating to meetings, quorums, committees,
and other matters, all as typically contained in the bylaws of
a similar private investment fund.'';
(2) in subsection (d)--
(A) by striking ``(after consultation with
the Commission and the Secretary of the
Treasury)'';
(B) by striking paragraph (1); and
(C) by redesignating paragraphs (2) through
(4) as paragraphs (1) through (3),
respectively; and
(3) in subsection (g), by striking ``subsection
(d)(2)'' and inserting ``subsection (d)(1)''.
Subtitle G--Federal Spectrum Relocation
SEC. 6701. RELOCATION OF AND SPECTRUM SHARING BY FEDERAL GOVERNMENT
STATIONS.
(a) In General.--Section 113 of the National
Telecommunications and Information Administration Organization
Act (47 U.S.C. 923) is amended--
(1) in subsection (g)--
(A) by striking the heading and inserting
``Relocation of and Spectrum Sharing by Federal
Government Stations.--'';
(B) by amending paragraph (1) to read as
follows:
``(1) Eligible federal entities.--Any Federal
entity that operates a Federal Government station
authorized to use a band of eligible frequencies
described in paragraph (2) and that incurs relocation
or sharing costs because of planning for an auction of
spectrum frequencies or the reallocation of spectrum
frequencies from Federal use to exclusive non-Federal
use or to shared use shall receive payment for such
relocation or sharing costs from the Spectrum
Relocation Fund, in accordance with this section and
section 118. For purposes of this paragraph, Federal
power agencies exempted under subsection (c)(4) that
choose to relocate from the frequencies identified for
reallocation pursuant to subsection (a) are eligible to
receive payment under this paragraph.'';
(C) by amending paragraph (2)(B) to read as
follows:
``(B) any other band of frequencies
reallocated from Federal use to non-Federal use
or to shared use after January 1, 2003, that is
assigned by competitive bidding pursuant to
section 309(j) of the Communications Act of
1934 (47 U.S.C. 309(j)).'';
(D) by amending paragraph (3) to read as
follows:
``(3) Relocation or sharing costs defined.--
``(A) In general.--For purposes of this
section and section 118, the term `relocation
or sharing costs' means the costs incurred by a
Federal entity in connection with the auction
of spectrum frequencies previously assigned to
such entity or the sharing of spectrum
frequencies assigned to such entity (including
the auction or a planned auction of the rights
to use spectrum frequencies on a shared basis
with such entity) in order to achieve
comparable capability of systems as before the
relocation or sharing arrangement. Such term
includes, with respect to relocation or
sharing, as the case may be--
``(i) the costs of any modification
or replacement of equipment, spares,
associated ancillary equipment,
software, facilities, operating
manuals, training, or compliance with
regulations that are attributable to
relocation or sharing;
``(ii) the costs of all
engineering, equipment, software, site
acquisition, and construction, as well
as any legitimate and prudent
transaction expense, including term-
limited Federal civil servant and
contractor staff necessary to carry out
the relocation or sharing activities of
a Federal entity, and reasonable
additional costs incurred by the
Federal entity that are attributable to
relocation or sharing, including
increased recurring costs associated
with the replacement of facilities;
``(iii) the costs of research,
engineering studies, economic analyses,
or other expenses reasonably incurred
in connection with--
``(I) calculating the
estimated relocation or sharing
costs that are provided to the
Commission pursuant to
paragraph (4)(A);
``(II) determining the
technical or operational
feasibility of relocation to 1
or more potential relocation
bands; or
``(III) planning for or
managing a relocation or
sharing arrangement (including
spectrum coordination with
auction winners);
``(iv) the one-time costs of any
modification of equipment reasonably
necessary--
``(I) to accommodate non-
Federal use of shared
frequencies; or
``(II) in the case of
eligible frequencies
reallocated for exclusive non-
Federal use and assigned
through a system of competitive
bidding under section 309(j) of
the Communications Act of 1934
(47 U.S.C. 309(j)) but with
respect to which a Federal
entity retains primary
allocation or protected status
for a period of time after the
completion of the competitive
bidding process, to accommodate
shared Federal and non-Federal
use of such frequencies for
such period; and
``(v) the costs associated with the
accelerated replacement of systems and
equipment if the acceleration is
necessary to ensure the timely
relocation of systems to a new
frequency assignment or the timely
accommodation of sharing of Federal
frequencies.
``(B) Comparable capability of systems.--
For purposes of subparagraph (A), comparable
capability of systems--
``(i) may be achieved by relocating
a Federal Government station to a new
frequency assignment, by relocating a
Federal Government station to a
different geographic location, by
modifying Federal Government equipment
to mitigate interference or use less
spectrum, in terms of bandwidth,
geography, or time, and thereby
permitting spectrum sharing (including
sharing among relocated Federal
entities and incumbents to make
spectrum available for non-Federal use)
or relocation, or by utilizing an
alternative technology; and
``(ii) includes the acquisition of
state-of-the-art replacement systems
intended to meet comparable operational
scope, which may include incidental
increases in functionality.'';
(E) in paragraph (4)--
(i) in the heading, by striking
``relocations costs'' and inserting
``relocation or sharing costs'';
(ii) by striking ``relocation
costs'' each place it appears and
inserting ``relocation or sharing
costs''; and
(iii) in subparagraph (A), by
inserting ``or sharing'' after ``such
relocation'';
(F) in paragraph (5)--
(i) by striking ``relocation
costs'' and inserting ``relocation or
sharing costs''; and
(ii) by inserting ``or sharing''
after ``for relocation''; and
(G) by amending paragraph (6) to read as
follows:
``(6) Implementation of procedures.--The NTIA shall
take such actions as necessary to ensure the timely
relocation of Federal entities' spectrum-related
operations from frequencies described in paragraph (2)
to frequencies or facilities of comparable capability
and to ensure the timely implementation of arrangements
for the sharing of frequencies described in such
paragraph. Upon a finding by the NTIA that a Federal
entity has achieved comparable capability of systems,
the NTIA shall terminate or limit the entity's
authorization and notify the Commission that the
entity's relocation has been completed or sharing
arrangement has been implemented. The NTIA shall also
terminate such entity's authorization if the NTIA
determines that the entity has unreasonably failed to
comply with the timeline for relocation or sharing
submitted by the Director of the Office of Management
and Budget under section 118(d)(2)(C).'';
(2) by redesignating subsections (h) and (i) as
subsections (k) and (l), respectively; and
(3) by inserting after subsection (g) the
following:
``(h) Development and Publication of Relocation or Sharing
Transition Plans.--
``(1) Development of transition plan by federal
entity.--Not later than 240 days before the
commencement of any auction of eligible frequencies
described in subsection (g)(2), a Federal entity
authorized to use any such frequency shall submit to
the NTIA and to the Technical Panel established by
paragraph (3) a transition plan for the implementation
by such entity of the relocation or sharing
arrangement. The NTIA shall specify, after public
input, a common format for all Federal entities to
follow in preparing transition plans under this
paragraph.
``(2) Contents of transition plan.--The transition
plan required by paragraph (1) shall include the
following information:
``(A) The use by the Federal entity of the
eligible frequencies to be auctioned, current
as of the date of the submission of the plan.
``(B) The geographic location of the
facilities or systems of the Federal entity
that use such frequencies.
``(C) The frequency bands used by such
facilities or systems, described by geographic
location.
``(D) The steps to be taken by the Federal
entity to relocate its spectrum use from such
frequencies or to share such frequencies,
including timelines for specific geographic
locations in sufficient detail to indicate when
use of such frequencies at such locations will
be discontinued by the Federal entity or shared
between the Federal entity and non-Federal
users.
``(E) The specific interactions between the
eligible Federal entity and the NTIA needed to
implement the transition plan.
``(F) The name of the officer or employee
of the Federal entity who is responsible for
the relocation or sharing efforts of the entity
and who is authorized to meet and negotiate
with non-Federal users regarding the
transition.
``(G) The plans and timelines of the
Federal entity for--
``(i) using funds received from the
Spectrum Relocation Fund established by
section 118;
``(ii) procuring new equipment and
additional personnel needed for
relocation or sharing;
``(iii) field-testing and deploying
new equipment needed for relocation or
sharing; and
``(iv) hiring and relying on
contract personnel, if any, needed for
relocation or sharing.
``(H) Factors that could hinder fulfillment
of the transition plan by the Federal entity.
``(3) Technical panel.--
``(A) Establishment.--There is established
within the NTIA a panel to be known as the
Technical Panel.
``(B) Membership.--
``(i) Number and appointment.--The
Technical Panel shall be composed of 3
members, to be appointed as follows:
``(I) One member to be
appointed by the Director of
the Office of Management and
Budget (in this subsection
referred to as `OMB').
``(II) One member to be
appointed by the Assistant
Secretary.
``(III) One member to be
appointed by the Chairman of
the Commission.
``(ii) Qualifications.--Each member
of the Technical Panel shall be a radio
engineer or a technical expert.
``(iii) Initial appointment.--The
initial members of the Technical Panel
shall be appointed not later than 180
days after the date of the enactment of
the Middle Class Tax Relief and Job
Creation Act of 2012.
``(iv) Terms.--The term of a member
of the Technical Panel shall be 18
months, and no individual may serve
more than 1 consecutive term.
``(v) Vacancies.--Any member
appointed to fill a vacancy occurring
before the expiration of the term for
which the member's predecessor was
appointed shall be appointed only for
the remainder of that term. A member
may serve after the expiration of that
member's term until a successor has
taken office. A vacancy shall be filled
in the manner in which the original
appointment was made.
``(vi) No compensation.--The
members of the Technical Panel shall
not receive any compensation for
service on the Technical Panel. If any
such member is an employee of the
agency of the official that appointed
such member to the Technical Panel,
compensation in the member's capacity
as such an employee shall not be
considered compensation under this
clause.
``(C) Administrative support.--The NTIA
shall provide the Technical Panel with the
administrative support services necessary to
carry out its duties under this subsection and
subsection (i).
``(D) Regulations.--Not later than 180 days
after the date of the enactment of the Middle
Class Tax Relief and Job Creation Act of 2012,
the NTIA shall, after public notice and comment
and subject to approval by the Director of OMB,
adopt regulations to govern the workings of the
Technical Panel.
``(E) Certain requirements inapplicable.--
The Federal Advisory Committee Act (5 U.S.C.
App.) and sections 552 and 552b of title 5,
United States Code, shall not apply to the
Technical Panel.
``(4) Review of plan by technical panel.--
``(A) In general.--Not later than 30 days
after the submission of the plan under
paragraph (1), the Technical Panel shall submit
to the NTIA and to the Federal entity a report
on the sufficiency of the plan, including
whether the plan includes the information
required by paragraph (2) and an assessment of
the reasonableness of the proposed timelines
and estimated relocation or sharing costs,
including the costs of any proposed expansion
of the capabilities of a Federal system in
connection with relocation or sharing.
``(B) Insufficiency of plan.--If the
Technical Panel finds the plan insufficient,
the Federal entity shall, not later than 90
days after the submission of the report by the
Technical panel under subparagraph (A), submit
to the Technical Panel a revised plan. Such
revised plan shall be treated as a plan
submitted under paragraph (1).
``(5) Publication of transition plan.--Not later
than 120 days before the commencement of the auction
described in paragraph (1), the NTIA shall make the
transition plan publicly available on its website.
``(6) Updates of transition plan.--As the Federal
entity implements the transition plan, it shall
periodically update the plan to reflect any changed
circumstances, including changes in estimated
relocation or sharing costs or the timeline for
relocation or sharing. The NTIA shall make the updates
available on its website.
``(7) Classified and other sensitive information.--
``(A) Classified information.--If any of
the information required to be included in the
transition plan of a Federal entity is
classified information (as defined in section
798(b) of title 18, United States Code), the
entity shall--
``(i) include in the plan--
``(I) an explanation of the
exclusion of any such
information, which shall be as
specific as possible; and
``(II) all relevant non-
classified information that is
available; and
``(ii) discuss as a factor under
paragraph (2)(H) the extent of the
classified information and the effect
of such information on the
implementation of the relocation or
sharing arrangement.
``(B) Regulations.--Not later than 180 days
after the date of the enactment of the Middle
Class Tax Relief and Job Creation Act of 2012,
the NTIA, in consultation with the Director of
OMB and the Secretary of Defense, shall adopt
regulations to ensure that the information
publicly released under paragraph (5) or (6)
does not contain classified information or
other sensitive information.
``(i) Dispute Resolution Process.--
``(1) In general.--If a dispute arises between a
Federal entity and a non-Federal user regarding the
execution, timing, or cost of the transition plan
submitted by the Federal entity under subsection
(h)(1), the Federal entity or the non-Federal user may
request that the NTIA establish a dispute resolution
board to resolve the dispute.
``(2) Establishment of board.--
``(A) In general.--If the NTIA receives a
request under paragraph (1), it shall establish
a dispute resolution board.
``(B) Membership and appointment.--The
dispute resolution board shall be composed of 3
members, as follows:
``(i) A representative of the
Office of Management and Budget (in
this subsection referred to as `OMB'),
to be appointed by the Director of OMB.
``(ii) A representative of the
NTIA, to be appointed by the Assistant
Secretary.
``(iii) A representative of the
Commission, to be appointed by the
Chairman of the Commission.
``(C) Chair.--The representative of OMB
shall be the Chair of the dispute resolution
board.
``(D) Vacancies.--Any vacancy in the
dispute resolution board shall be filled in the
manner in which the original appointment was
made.
``(E) No compensation.--The members of the
dispute resolution board shall not receive any
compensation for service on the board. If any
such member is an employee of the agency of the
official that appointed such member to the
board, compensation in the member's capacity as
such an employee shall not be considered
compensation under this subparagraph.
``(F) Termination of board.--The dispute
resolution board shall be terminated after it
rules on the dispute that it was established to
resolve and the time for appeal of its decision
under paragraph (7) has expired, unless an
appeal has been taken under such paragraph. If
such an appeal has been taken, the board shall
continue to exist until the appeal process has
been exhausted and the board has completed any
action required by a court hearing the appeal.
``(3) Procedures.--The dispute resolution board
shall meet simultaneously with representatives of the
Federal entity and the non-Federal user to discuss the
dispute. The dispute resolution board may require the
parties to make written submissions to it.
``(4) Deadline for decision.--The dispute
resolution board shall rule on the dispute not later
than 30 days after the request was made to the NTIA
under paragraph (1).
``(5) Assistance from technical panel.--The
Technical Panel established under subsection (h)(3)
shall provide the dispute resolution board with such
technical assistance as the board requests.
``(6) Administrative support.--The NTIA shall
provide the dispute resolution board with the
administrative support services necessary to carry out
its duties under this subsection.
``(7) Appeals.--A decision of the dispute
resolution board may be appealed to the United States
Court of Appeals for the District of Columbia Circuit
by filing a notice of appeal with that court not later
than 30 days after the date of such decision. Each
party shall bear its own costs and expenses, including
attorneys' fees, for any appeal under this paragraph.
``(8) Regulations.--Not later than 180 days after
the date of the enactment of the Middle Class Tax
Relief and Job Creation Act of 2012, the NTIA shall,
after public notice and comment and subject to approval
by OMB, adopt regulations to govern the working of any
dispute resolution boards established under paragraph
(2)(A) and the role of the Technical Panel in assisting
any such board.
``(9) Certain requirements inapplicable.--The
Federal Advisory Committee Act (5 U.S.C. App.) and
sections 552 and 552b of title 5, United States Code,
shall not apply to a dispute resolution board
established under paragraph (2)(A).
``(j) Relocation Prioritized Over Sharing.--
``(1) In general.--In evaluating a band of
frequencies for possible reallocation for exclusive
non-Federal use or shared use, the NTIA shall give
priority to options involving reallocation of the band
for exclusive non-Federal use and shall choose options
involving shared use only when it determines, in
consultation with the Director of the Office of
Management and Budget, that relocation of a Federal
entity from the band is not feasible because of
technical or cost constraints.
``(2) Notification of congress when sharing
chosen.--If the NTIA determines under paragraph (1)
that relocation of a Federal entity from the band is
not feasible, the NTIA shall notify the Committee on
Commerce, Science, and Transportation of the Senate and
the Committee on Energy and Commerce of the House of
Representatives of the determination, including the
specific technical or cost constraints on which the
determination is based.''.
(b) Conforming Amendment.--Section 309(j) of the
Communications Act of 1934 is further amended by striking
``relocation costs'' each place it appears and inserting
``relocation or sharing costs''.
SEC. 6702. SPECTRUM RELOCATION FUND.
Section 118 of the National Telecommunications and
Information Administration Organization Act (47 U.S.C. 928) is
amended--
(1) by striking ``relocation costs'' each place it
appears and inserting ``relocation or sharing costs'';
(2) by amending subsection (c) to read as follows:
``(c) Use of Funds.--The amounts in the Fund from auctions
of eligible frequencies are authorized to be used to pay
relocation or sharing costs of an eligible Federal entity
incurring such costs with respect to relocation from or sharing
of those frequencies.'';
(3) in subsection (d)--
(A) in paragraph (2)--
(i) in subparagraph (A), by
inserting ``or sharing'' before the
semicolon;
(ii) in subparagraph (B), by
inserting ``or sharing'' before the
period at the end;
(iii) by redesignating
subparagraphs (A) and (B) as
subparagraphs (B) and (C),
respectively; and
(iv) by inserting before
subparagraph (B), as so redesignated,
the following:
``(A) unless the eligible Federal entity
has submitted a transition plan to the NTIA as
required by paragraph (1) of section 113(h),
the Technical Panel has found such plan
sufficient under paragraph (4) of such section,
and the NTIA has made available such plan on
its website as required by paragraph (5) of
such section;'';
(B) by striking paragraph (3); and
(C) by adding at the end the following:
``(3) Transfers for pre-auction costs.--
``(A) In general.--Subject to subparagraph
(B), the Director of OMB may transfer to an
eligible Federal entity, at any time (including
prior to a scheduled auction), such sums as may
be available in the Fund to pay relocation or
sharing costs related to pre-auction estimates
or research, as such costs are described in
section 113(g)(3)(A)(iii).
``(B) Notification.--No funds may be
transferred pursuant to subparagraph (A)
unless--
``(i) the notification provided
under paragraph (2)(C) includes a
certification from the Director of OMB
that--
``(I) funds transferred
before an auction will likely
allow for timely implementation
of relocation or sharing,
thereby increasing net expected
auction proceeds by an amount
not less than the time value of
the amount of funds
transferred; and
``(II) the auction is
intended to occur not later
than 5 years after transfer of
funds; and
``(ii) the transition plan
submitted by the eligible Federal
entity under section 113(h)(1)
provides--
``(I) to the fullest extent
possible, for sharing and
coordination of eligible
frequencies with non-Federal
users, including reasonable
accommodation by the eligible
Federal entity for the use of
eligible frequencies by non-
Federal users during the period
that the entity is relocating
its spectrum uses (in this
clause referred to as the
`transition period');
``(II) for non-Federal
users to be able to use
eligible frequencies during the
transition period in geographic
areas where the eligible
Federal entity does not use
such frequencies;
``(III) that the eligible
Federal entity will, during the
transition period, make itself
available for negotiation and
discussion with non-Federal
users not later than 30 days
after a written request
therefor; and
``(IV) that the eligible
Federal entity will, during the
transition period, make
available to a non-Federal user
with appropriate security
clearances any classified
information (as defined in
section 798(b) of title 18,
United States Code) regarding
the relocation process, on a
need-to-know basis, to assist
the non-Federal user in the
relocation process with such
eligible Federal entity or
other eligible Federal
entities.
``(C) Applicability to certain costs.--
``(i) In general.--The Director of
OMB may transfer under subparagraph (A)
not more than $10,000,000 for costs
incurred after June 28, 2010, but
before the date of the enactment of the
Middle Class Tax Relief and Job
Creation Act of 2012.
``(ii) Supplement not supplant.--
Any amounts transferred by the Director
of OMB pursuant to clause (i) shall be
in addition to any amounts that the
Director of OMB may transfer for costs
incurred on or after the date of the
enactment of the Middle Class Tax
Relief and Job Creation Act of 2012.
``(4) Reversion of unused funds.--Any amounts in
the Fund that are remaining after the payment of the
relocation or sharing costs that are payable from the
Fund shall revert to and be deposited in the general
fund of the Treasury, for the sole purpose of deficit
reduction, not later than 8 years after the date of the
deposit of such proceeds to the Fund, unless within 60
days in advance of the reversion of such funds, the
Director of OMB, in consultation with the NTIA,
notifies the congressional committees described in
paragraph (2)(C) that such funds are needed to complete
or to implement current or future relocation or sharing
arrangements.'';
(4) in subsection (e)--
(A) in paragraph (1)(B)--
(i) in clause (i), by striking
``subsection (d)(2)(A)'' and inserting
``subsection (d)(2)(B)''; and
(ii) in clause (ii), by striking
``subsection (d)(2)(B)'' and inserting
``subsection (d)(2)(C)''; and
(B) in paragraph (2)--
(i) by striking ``entity's
relocation'' and inserting ``relocation
of the entity or implementation of the
sharing arrangement by the entity'';
(ii) by inserting ``or the
implementation of such arrangement''
after ``such relocation''; and
(iii) by striking ``subsection
(d)(2)(A)'' and inserting ``subsection
(d)(2)(B)''; and
(5) by adding at the end the following:
``(f) Additional Payments From Fund.--
``(1) Amounts available.--Notwithstanding
subsections (c) through (e), after the date of the
enactment of the Middle Class Tax Relief and Job
Creation Act of 2012, there are appropriated from the
Fund and available to the Director of OMB for use in
accordance with paragraph (2) not more than 10 percent
of the amounts deposited in the Fund from auctions
occurring after such date of enactment of licenses for
the use of spectrum vacated by eligible Federal
entities.
``(2) Use of amounts.--
``(A) In general.--The Director of OMB, in
consultation with the NTIA, may use amounts
made available under paragraph (1) to make
payments to eligible Federal entities that are
implementing a transition plan submitted under
section 113(h)(1) in order to encourage such
entities to complete the implementation more
quickly, thereby encouraging timely access to
the eligible frequencies that are being
reallocated for exclusive non-Federal use or
shared use.
``(B) Conditions.--In the case of any
payment by the Director of OMB under
subparagraph (A)--
``(i) such payment shall be based
on the market value of the eligible
frequencies, the timeliness with which
the eligible Federal entity clears its
use of such frequencies, and the need
for such frequencies in order for the
entity to conduct its essential
missions;
``(ii) the eligible Federal entity
shall use such payment for the purposes
specified in clauses (i) through (v) of
section 113(g)(3)(A) to achieve
comparable capability of systems
affected by the reallocation of
eligible frequencies from Federal use
to exclusive non-Federal use or to
shared use;
``(iii) such payment may not be
made if the amount remaining in the
Fund after such payment will be less
than 10 percent of the winning bids in
the auction of the spectrum with
respect to which the Federal entity is
incurring relocation or sharing costs;
and
``(iv) such payment may not be made
until 30 days after the Director of OMB
has notified the congressional
committees described in subsection
(d)(2)(C).
``(g) Restriction on Use of Funds.--No amounts in the Fund
on the day before the date of the enactment of the Middle Class
Tax Relief and Job Creation Act of 2012 may be used for any
purpose except--
``(1) to pay the relocation or sharing costs
incurred by eligible Federal entities in order to
relocate from the frequencies the auction of which
generated such amounts; or
``(2) to pay relocation or sharing costs related to
pre-auction estimates or research, in accordance with
subsection (d)(3).''.
SEC. 6703. NATIONAL SECURITY AND OTHER SENSITIVE INFORMATION.
Part B of title I of the National Telecommunications and
Information Administration Organization Act (47 U.S.C. 921 et
seq.) is amended by adding at the end the following:
``SEC. 119. NATIONAL SECURITY AND OTHER SENSITIVE INFORMATION.
``(a) Determination.--If the head of an Executive agency
(as defined in section 105 of title 5, United States Code)
determines that public disclosure of any information contained
in a notification or report required by section 113 or 118
would reveal classified national security information, or other
information for which there is a legal basis for nondisclosure
and the public disclosure of which would be detrimental to
national security, homeland security, or public safety or would
jeopardize a law enforcement investigation, the head of the
Executive agency shall notify the Assistant Secretary of that
determination prior to the release of such information.
``(b) Inclusion in Annex.--The head of the Executive agency
shall place the information with respect to which a
determination was made under subsection (a) in a separate annex
to the notification or report required by section 113 or 118.
The annex shall be provided to the subcommittee of primary
jurisdiction of the congressional committee of primary
jurisdiction in accordance with appropriate national security
stipulations but shall not be disclosed to the public or
provided to any unauthorized person through any means.''.
TITLE VII--MISCELLANEOUS PROVISIONS
SEC. 7001. REPEAL OF CERTAIN SHIFTS IN THE TIMING OF CORPORATE
ESTIMATED TAX PAYMENTS.
The following provisions of law (and any modification of
any such provision which is contained in any other provision of
law) shall not apply with respect to any installment of
corporate estimated tax:
(1) Section 201(b) of the Corporate Estimated Tax
Shift Act of 2009.
(2) Section 561 of the Hiring Incentives to Restore
Employment Act.
(3) Section 505 of the United States-Korea Free
Trade Agreement Implementation Act.
(4) Section 603 of the United States-Colombia Trade
Promotion Agreement Implementation Act.
(5) Section 502 of the United State-Panama Trade
Promotion Agreement Implementation Act.
SEC. 7002. REPEAL OF REQUIREMENT RELATING TO TIME FOR REMITTING CERTAIN
MERCHANDISE PROCESSING FEES.
(a) Repeal.--The Trade Adjustment Assistance Extension Act
of 2011 (title II of Public Law 112-40; 125 Stat. 402) is
amended by striking section 263.
(b) Clerical Amendment.--The table of contents for such Act
is amended by striking the item relating to section 263.
SEC. 7003. TREATMENT FOR PAYGO PURPOSES.
The budgetary effects of this Act shall not be entered on
either PAYGO scorecard maintained pursuant to section 4(d) of
the Statutory Pay-As-You-Go Act of 2010.
And the Senate agree to the same.
That the Senate recede from its amendment to the title of
the bill.
Dave Camp,
Fred Upton,
Kevin Brady,
Greg Walden,
Tom Price,
Tom Reed,
Renee L. Ellmers,
Nan A.S. Hayworth,
Sander M. Levin,
Xavier Becerra,
Chris Van Hollen,
Allyson Y. Schwartz,
Henry A. Waxman,
Managers on the Part of the House.
Max Baucus,
Jack Reed,
Benjamin L. Cardin,
Robert P. Casey, Jr.,
Managers on the Part of the Senate.
JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE
The managers on the part of the House and the Senate at
the conference on the disagreeing votes of the two Houses on
the amendments of the Senate to the bill (H.R. 3630), to
provide incentives for the creation of jobs, and for other
purposes, submit the following joint statement to the House and
the Senate in explanation of the effect of the action agreed
upon by the managers and recommended in the accompanying
conference report:
The Senate amendment struck all of the House bill after
the enacting clause and inserted a substitute text.
The House recedes from its disagreement to the amendment
of the Senate to the text with an amendment that is a
substitute for the House bill and the Senate amendment. The
Senate recedes from its amendment to the title. The committee
of the conference met on February 16, 2012 (the House chairing)
and resolved their differences. The differences between the
House bill, the Senate amendment, and the substitute agreed to
in conference are noted below, except for clerical corrections,
conforming changes made necessary by agreements reached by the
conferees, and minor drafting and clarifying changes.
TITLE
House bill
``Middle Class Tax Relief and Job Creation Act of 2011''
Senate bill
``Temporary Payroll Tax Cut Continuation Act of 2011''
Conference substitute
``Middle Class Tax Relief and Job Creation Act of 2012''
TITLE I--JOB CREATION INCENTIVES
Subtitle B--EPA Regulatory Relief
H1102,1103,1104,1105/S--
Current law
Section 112 of the Clean Air Act (42 U.S.C. 7412)
requires the Environmental Protection Agency (EPA) to
promulgate Maximum Achievable Control Technology (MACT)
standards for ``major'' sources of emissions of 187 hazardous
air pollutants (HAPs) and Generally Available Control
Technology (GACT) standards for smaller (``area'') sources of
HAP emissions. Section 129 of the act (42 U.S.C. 7429) requires
EPA to promulgate MACT standards for solid waste combustion
units. Under the act, existing boilers would be required to
comply with the applicable emission standards within 3 years of
the effective date of promulgated regulations, with a
possibility of a one-year extension for individual sources if
necessary for the installation of controls. Existing solid
waste incinerators would be required to meet the standards no
later than 5 years after promulgation. On March 21, 2011, EPA
finalized four related rules applicable to boilers and
commercial and industrial solid waste incinerator (CISWI)
units. Three rules established applicable MACT and GACT
standards for boilers and MACT standards for CISWI units. The
fourth rule (established under authority of the Resource
Conservation and Recovery Act) clarified when materials used as
fuel in a combustion unit would be defined as ``solid waste''
(a definition necessary to determine whether a combustion unit
would be subject to the CISWI standards rather than the less
stringent standards for boilers). EPA stayed the effective date
of its major sources and CISWI emission standards pending
reconsideration. EPA expects to complete the reconsideration by
April 2012. On January 9, 2012, a district court vacated EPA's
stay of the major sources and CISWI rules.
House bill
Sections 1102-1105 apply to EPA's four March 2011 rules.
Each rule would be revoked and EPA required to promulgate new
standards 15 months after the date of enactment (Section 1102).
In establishing the relevant emission standards, the
Administrator would be required to choose the ``least
burdensome'' regulatory alternatives. Further, EPA would be
required to establish standards that can be met under actual
operating conditions consistently and concurrently with other
standards (Section 1105). The compliance date for the air
emission standards would be no earlier than 5 years after the
date of the new regulation and could take feasibility, cost,
and other factors into account in setting the compliance date
(Section 1103). In promulgating new rules defining materials
that are solid waste when used as a fuel, EPA would be required
to adopt the definition of terms promulgated by the agency in a
December 2000 CISWI rule (Section 1104).
Senate bill
No provision.
Conference substitute
No provision.
TITLE II--EXTENSION OF CERTAIN EXPIRING PROVISIONS AND RELATED MEASURES
Subtitle B--Unemployment Compensation
PART 1--REFORMS OF UNEMPLOYMENT COMPENSATION TO PROMOTE WORK AND JOB
CREATION
H2121,2122,2123,2124,2125,2126,2127/S--
Current 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 to work. All
states have work search requirements in state law or regulation
in order for an individual to receive regular UC benefits. 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 may be considered as evidence of availability in some
states. There are often particular requirements and/or
exceptions for those workers on temporary layoff and for
workers that find employment through union hiring halls.
Section 202(c)(A)(ii) of the Federal-State Extended
Unemployment Compensation Act of 1970 (P.L. 97-373), as
amended, does explicitly require active job search. However,
the method of determining active job search is left to the
determination of the States.
Federal law does not require minimum educational
standards as a condition of benefit receipt. Section 303(a)(10)
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 (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 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
Internal Revenue Code (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.
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.
Section 3306(t) of the Federal Unemployment Tax Act
(FUTA) defines the Self-Employment Assistance (SEA) program.
Section 303(a)(5) of the Social Security Act permits the use of
expenditures from the Unemployment Trust Fund (UTF) for SEA.
The regular UC program generally requires unemployed workers to
be actively seeking work and to be available for wage and
salary jobs as a condition of eligibility for UC benefits. In
states that have opted to create SEA programs under current
law, SEA provides allowances in the same amount as regular UC
benefits to individuals who (1) would otherwise be eligible for
regular UC and (2) have been identified as likely to exhaust
regular UC benefits. Under SEA a participating individual is
not subject to worker search requirements so long as the
individual is participating in entrepreneurial training or
other activities.
Section 303(g)(1) of the Social Security Act and Section
3304(a)(4)(D) of the Internal Revenue Code (IRC) allow states
but do not require states to offset UC payments by non-fraud
overpayments. States may opt in state law to waive deductions
if it would be contrary to equity and good conscience.
There are no specific federal laws or regulations related
to uniform data elements for improved data matching in the
Federal-state unemployment compensation program. Section
303(a)(6) of the SSA requires states to make reports of
information and data as required by the U.S. Labor Secretary.
But current Federal law contains no precise requirements
regarding codes or identifiers attached to UC, Emergency
Unemployment Compensation (EUC08), or Extended Benefit (EB)
program data or any other data standards.
Federal law does not specifically authorize drug testing
of applicants as a condition of UC benefit eligibility. No
state currently requires drug tests as a condition of
eligibility for unemployment benefits. There are states that
do, however, have state law provisions related to
disqualification for previously failed drug tests/use of
illegal drugs during prior employment.
House bill
Section 2121 would add new federal law requirements for
state UC eligibility related to being ``able, available, and
actively seeking work''--with the latter specifically defined
under federal law, including at least (1) registering for
employment services within 10 days after initial filing for UC
benefits; (2) posting a resume, record, or other application
for employment through a state agency database; and (3)
applying for work under state requirements [effective for weeks
beginning after end of first state legislative session after
enactment]. No new funds would be provided for such activities.
There would be no exceptions for those on temporary lay-off
with expectation of recall, union members, or for those who are
striking.
Section 2122 would add new federal law requirements for
state UC eligibility: (1) UC claimants must meet minimum
education requirements: either earn HS diploma, attain GED, or
enroll/make satisfactory progress in classes leading to HS
diploma or GED (states would be allowed to waive this
educational requirement if state law deems it unduly
burdensome); and (2) UC claimants referred to reemployment
services must participate. Additionally, the proposal would add
a new federal law provision to stipulate that UC may not be
denied to an individual enrolled/making satisfactory progress
in education or state-approved job training [effective for
weeks beginning after end of first state legislative session
after enactment].
Section 2123 would authorize under federal law up to 10
state UC demonstration projects a year (lasting up to 3 years).
Demonstration projects would test and evaluate measures
designed to expedite the reemployment of individuals who
establish initial eligibility for regular UC or to improve the
effectiveness of state reemployment efforts. States would
provide a general description of the proposed demonstration
project. The description would include: (1) a description of
the proposed project, its authority under State law, and the
period during which the project would be conducted; (2) the
specifics of any waiver to Federal law and the reason for such
waiver; (3) a description of the goals and expected outcomes of
the project; (4) assurances and supporting analysis that the
project would not result in a net increase cost to the state's
Unemployment Trust Fund (UTF); (5) a description of the impact
evaluation; and (6) assurances of reports required by the U.S.
Labor Secretary. Section 2123 would allow the U.S. Labor
Secretary to waive the withdrawal standard and/or merit
employee requirements if requested by the state (state UTF
funds would be allowed to be used for purposes other than
paying unemployment benefits). Authority ends 5 years after
date of enactment of the section. Administrative grants to the
states for administration of the regular UC program may be used
for an approved project.
Section 2124 would require the U.S. Department of Labor
(U.S. DOL) to develop and maintain model language for states to
use in enacting SEA programs for regular UC claimants (as
authorized under current federal law); this model language
would be developed through U.S. DOL consultation with
employers, labor organizations, state UC agencies, and other
relevant program experts; would require U.S. DOL to provide
technical assistance and guidance to states in enacting,
improving, and administering SEA programs; would require U.S.
DOL to establish reporting requirements for state SEA programs,
including reporting (1) on the number of jobs and businesses
created by SEA programs and (2) the federal and state tax
revenues collected from such businesses and their employees;
and would require U.S. DOL to coordinate with the Small
Business Administration to ensure adequate funding for the
entrepreneurial training of SEA participants in states with SEA
programs.
Section 2125 would require states to recover 100% of any
erroneous overpayment by reducing up to 100% of the UC benefit
in each week until the overpayment is fully recovered. The
proposal would not allow states to waive such deduction if it
would be contrary to equity and good conscience. Section 2125
also would create authority for states to recover Federal
Additional Compensation (FAC) overpayments through deductions
to regular unemployment compensation.
Section 2126 would require that the U.S. Labor Secretary
designate standard data elements for any information required
under title III or title IX of the SSA. This section would
require the standard data elements incorporate interoperable
standards that have been developed and used by an international
standards body (as established by the Office of Management and
Budget (OMB) and the U.S. Labor Secretary); intergovernmental
partnerships; and Federal entities with contracting and
financial assistance authority. In addition, Section 106(a) of
this proposal would require the U.S. Labor Secretary, in
consultation with an OMB interagency working group and States,
to designate standard data elements that, to the extent
practicable: (1) Make use of a widely-accepted, non-
proprietary, digital, searchable format; (2) Are consistent
with and use relevant accounting principles; (3) Are able to be
upgraded on a continual basis; and (4) Incorporate non-
proprietary standards (such as the eXtensible Business
Reporting Language).
Section 2127 would clarify federal law to allow (but
would not require) drug testing of UC applicants.
Senate bill
No provision.
Conference substitute
The conference agreement follows the House bill with
regard to specifying new federal minimum standards for state
unemployment compensation eligibility related to being ``able,
available, and actively seek work.'' (See also part 3 of this
section with regard to job search requirements related to
Federal unemployment benefits.)
The conference agreement follows the House bill with
regard to State flexibility (i.e. new waiver authority), but
with the following modifications:
(1) Permits a total of no more than 10 States to
receive waivers;
(2) Specifies that waivers may only be used to
operate programs providing subsidies for employer-
provided training or for direct disbursements (such as
wage subsidies) to employers who hire individuals
receiving UC benefits, not to exceed the weekly benefit
amount, to cover part of the cost of their wages, and
provided that the overall wage is greater than the
unemployment benefit the individual had been receiving;
(3) Limits the operation of State waiver programs
to no more than 3 years, and specifies that the waiver
programs cannot be extended;
(4) Requires the state to evaluate their waiver
programs; and
(5) Requires States to provide assurances that any
employment meets the State's suitable work requirement
and requirements of section 3304(a)(5) of the Internal
Revenue Code and that the waiver programs end by
December 31, 2015.
The conference agreement follows the House bill and
incorporates S. 1826 with regard to the Self-Employment
Assistance Program, while also authorizing States to operate
SEA programs to assist individuals eligible for benefits under
the Emergency Unemployment Compensation (EUC) and Extended
Benefit (EB) programs, and providing funds to assist States
with the administration of such programs.
The conference agreement includes a new provision based
on S. 1333 authorizing work sharing programs and providing
program and administrative funding for that purpose.
The conference agreement follows the House bill with
regard to requiring States to offset current State benefits to
recover prior overpayments of State, other States', or Federal
unemployment benefits. With regard to efforts to recover
overpayments owed to other States and the Federal government,
the conference agreement requires each State to apply hardship
exceptions and related terms that follow State practice used to
recover overpayments of its own State benefit funds.
The conference agreement follows the House bill with
regard to the data standardization provisions.
The conference agreement follows the House bill with
regard to drug testing provisions, with the modification that
drug screening and testing is permitted in any State, but only
in cases in which the individual applying for unemployment
benefits either (1) was terminated from their prior employment
because of unlawful drug use (2) is applying for work for which
passing a drug test is a standard eligibility requirement.
PART 2--PROVISIONS RELATING TO EXTENDED BENEFITS
H2142,2143,2144/S201,202
Current law
Under P.L. 110-252, as amended, the authorization of the
EUC08 program expires the week ending on or before March 6,
2012. Individuals receiving benefits in any tier of EUC08 would
be able to finish out that tier of benefits only
(grandfathering for current tier only). No EUC08 benefits--
regardless of tier--are payable for any week after August 15,
2012. The current structure of unemployment benefits available
through the EUC08 program is: Tier I: up to 20 weeks of
unemployment benefits (available in all states); Tier II: up to
14 weeks (available in all states); Tier III: up to 13 weeks
(available in states with a total unemployment rate (TUR) of at
least 6% or an insured unemployment rate (IUR) of at least 4%);
Tier IV: up to 6 weeks (available in states with a TUR of at
least 8.5% or an IUR of at least 6%). Section 4001(e) of P.L.
110-252, as amended allows states the option to pay EUC08
before EB.
Under permanent law (P.L. 97-373), EB benefits are
financed 50% by the federal government (through federal
unemployment taxes; i.e., FUTA) and states fund the other half
(50%) of EB benefit costs through their state unemployment
taxes (SUTA). ARRA (P.L. 111-5, as amended) temporarily changed
the federal-state funding arrangement for the EB program.
Currently, the FUTA finances 100% of sharable EB benefits
through March 7, 2012. P.L. 111-312 made some temporary
technical changes to certain triggers in the EB program, which
allow states to temporarily use lookback calculations based on
three years of unemployment rate data (rather than the
permanent law lookback of two years of data) as part of their
EB triggers if states would otherwise trigger off or not be on
a period of EB benefits. This temporary option to use three-
year EB trigger lookback expires the week ending on or before
February 29, 2012.
P.L. 111-5, as amended, temporarily increased the
duration of extended unemployment benefits for railroad
workers. Railroad workers who previously were not eligible for
extended unemployment benefits because they did not have 10
years of service may be eligible for benefits of up to 65 days
within an extended period consisting of seven consecutive two-
week registration periods. Railroad workers who previously were
eligible for extended unemployment benefits of up to 65 days
(because they had 10 years of service) may now be eligible for
benefits of up to 130 days within an extended period consisting
of 13 consecutive two-week registration periods. P.L. 111-312
extended the ARRA provisions by one year to June 30, 2011.
Under P.L. 111-312, the special extended unemployment benefit
period could begin no later than December 31, 2011. P.L. 112-78
extended the temporary extended railroad unemployment benefit
(authorized under ARRA (P.L. 111-5), as amended) for two months
through February 29, 2012, to be financed with funds still
available under P.L. 111-312.
House bill
Section 2142 would extend the authorization of Tiers I
and III of EUC08 until the week ending on or before January 31,
2013. The duration and conditions for availability of Tier II
would be altered. There would be no benefits payable after that
date. (There would be no grandfathering of benefits.) Tier I
would continue to offer up to 20 weeks in all states, Tier II
would offer up to 13 weeks (rather than 14) and would be
available in states with at least 6.0% TUR or an IUR of at
least 4% (rather than in all states). Tiers III and IV would
not be reauthorized. Note: Included in this subsection was an
intent to require states to pay EUC08 before any EB
entitlement. However, the version passed by the House would
require states to pay EB before EUC08 and will need correction
to reflect the intended ordering of benefits. (At the time of
House passage, the authorization for all EUC08 tiers would have
expired on the week ending on or before January 3, 2012 and no
EUC08 benefit would have been payable for any week after June
9, 2012.)
Section 2143 would extend the 100% federal financing of
EB through January 31, 2013, as well as the option for states
to use three-year lookback in their EB triggers until the week
ending on or before January 31, 2013. (At the time of House
passage, the FUTA financed 100% of sharable EB benefits through
January 4, 2012 and the three-year lookback would have expired
on the week ending on or before December 31, 2011.)
Section 2144 would extend the temporary extended railroad
unemployment benefit (authorized under ARRA (P.L. 111-5), as
amended) for 13 months through January 31, 2013, to be financed
with funds still available under P.L. 111-312. (At the time of
House passage, the special extended unemployment benefit period
could begin no later than December 31, 2011.)
Senate bill
Section 201 would extend the authorization for the EUC08
program (as structured under current law) until the week ending
on or before March 6, 2012. No EUC08 benefits--regardless of
tier--would be payable for any week after August 15, 2012. (At
the time of Senate passage, the authorization for all EUC08
tiers would have expired on the week ending on or before
January 3, 2012 and no EUC08 benefit would have been payable
for any week after June 9, 2012.) This section would extend the
100% federal financing of EB through March 7, 2012. This
section would also extend the option for states to use the
three-year lookback in their EB triggers until the week ending
on or before February 29, 2012. (At the time of Senate passage,
the FUTA financed 100% of sharable EB benefits through January
4, 2012 and the three-year lookback would have expired on the
week ending on or before December 31, 2011.)
Section 202 would extend the temporary extended railroad
unemployment benefit (authorized under ARRA (P.L. 111-5), as
amended) for two months through February 29, 2012, to be
financed with funds still available under P.L. 111-312. (At the
time of Senate passage, the special extended unemployment
benefit period could begin no later than December 31, 2011.)
Conference substitute
The conference agreement follows the House bill in
continuing the operation of the Federal Emergency Unemployment
Compensation (EUC) program beyond its current expiration at the
end of February 2012, with the following modifications:
(1) The authorization of the EUC program is
extended through the end of December 2012;
(2) The EUC program will not continue to provide
benefits after December 2012 (i.e. there will be no
``phase-out'' of benefits beyond December 2012);
(3) EUC benefits would continue to be payable in up
to four tiers as under current law. However, as the
table below reflects, in the case of tiers two through
four, higher total unemployment rate (TUR) ``triggers''
will apply from June through December 2012, as follows:
------------------------------------------------------------------------
March through May June through August September through
EUC Tier 2012 2012 December 2012
------------------------------------------------------------------------
1........ 20 weeks in all 20 weeks in all 14 weeks in all
states. states. states
2........ 14 weeks in all 14 weeks in 6% or 14 weeks in 6% or
states. higher states. higher states
3........ 13 weeks in 6% or 13 weeks in 7% or 9 weeks in 7% or
higher states. higher states. higher states
4........ 6 weeks in 8.5% or 6 weeks in 9% or 10 weeks in 9% or
higher states (16 higher states. higher states
weeks if not on
EB).
------------------------------------------------------------------------
(4) Through May 2012 only, individuals who have not
already received up to 20 weeks of EB program benefits
due to the application of that program's ``3-year
lookback'' would be eligible to receive up to an
additional 10 weeks of benefits under Tier 4 of the EUC
program (that is, in addition to the six weeks
otherwise available), provided they are in a State with
an unemployment rate above 8.5%, and with the condition
that no such individual could receive a total of more
than 99 weeks of benefits from all sources (counting
State, EUC and EB programs).
(5) As the table above reflects, weeks of benefits
payable in tiers 1, 3 and 4 in September through
December 2012 would be adjusted, with tier 1 dropping
from 20 to 14 weeks, tier 3 dropping from 13 to 9
weeks, and tier 4 rising from 6 to 10 weeks. In all,
these changes will result in the maximum weeks of
benefits payable under the EUC program falling from 53
weeks under current law (in the case of States with
unemployment rates today at or above 8.5%) to a maximum
of up to 47 weeks (in the case of States with an
unemployment rate of 9% or higher) from September
through December 2012. In each period, an individual's
eligibility for a tier of benefits will be determined
according to the State's unemployment rate in that
period. For example, individuals exhausting tier 2 of
benefits will be eligible to begin tier 3 of benefits
in the spring only if their State has an unemployment
rate of at least 6%, while those exhausting tier 2 in
the summer and fall months can qualify for tier 3
benefits only if they are in a State with an
unemployment rate of at least 7%.
The conference agreement specifies that States are
required to pay EUC benefits before any benefits under the EB
program.
The conference agreement follows the House bill in terms
of extending the current temporary 100% Federal financing of EB
as well as the three-year lookback used to determine State
eligibility for EB, with the modification that in each case the
extension would apply through December 2012.
The conference agreement follows the House bill and
Senate amendment with regard to the temporary extended railroad
unemployment benefit program, with the modification that the
extension would apply through December 2012.
PART 3--IMPROVING REEMPLOYMENT STRATEGIES UNDER THE EMERGENCY
UNEMPLOYMENT COMPENSATION PROGRAM
H2161,2162,2163,2164,2165/S--
Current law
Federal unemployment law does not contain explicit job
search requirements for the receipt of EUC08 benefits. Federal
unemployment law does not require states to have work search
requirements in the regular UC program. However, all states
have work search requirements in state law or regulation in
order for an individual to receive regular UC benefits. Section
202(a)(3)(A)(ii) of the Federal-State Extended Unemployment
Compensation Act of 1970 (P.L. 97-373), as amended, explicitly
requires active job search for receipt of Extended Benefits
(EB). However, the method of determining active job search is
left to the determination of the states.
Federal law does not require minimum educational
standards or reemployment service participation as a condition
of EUC08 benefit receipt.
P.L. 110-252, as amended, requires that all EUC08
benefits be paid directly to the unemployed who have exhausted
entitlement to all regular UC benefits. There is no provision
for demonstration projects.
Section 4005(c)(1) of P.L. 110-252, as amended allows
states but does not require states to offset EUC08 payments by
non-fraud overpayments. Any offset under current law may not be
more than 50% of total EUC08 benefit.
Section 4001(g) of the Supplemental Appropriations Act of
2008 (P.L. 110-252), as amended, 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.
House bill
Section 2161 would require active work search for EUC08
entitlement where active work search must require at least the
following: individuals to register with reemployment services
within 30 days, individuals post a resume, record, or other
application for employment on a database required by the state,
and individuals apply for work in such a manner as required by
the state.
Section 2162 would require EUC08 beneficiaries (1) to
participate in reemployment services if referred and (2) to
actively search for work, effective on or after 30 days of
enactment for those individuals who enter a tier of EUC08. This
section would require individuals to meet the minimum
educational requirements (high school degree, GED, or enrolled
in program) created earlier in Section 2122 of the proposal
(amending Section 303(a)(10)(B) of the SSA). The participation
requirement for reemployment services would be waived if
individuals have already completed this requirement or if there
is ``justifiable cause'' as specified by guidance to be issued
by the U.S. DOL Secretary within 30 days. This section would
authorize up to $5 of an individual's EUC08 benefit each week
to be diverted (at state option) to fund these reemployment
services and activities.
Section 2163 would allow for up to 20% of all EUC08
recipients in each state to be diverted into demonstration
projects. The demonstration projects would need to be designed
to expedite reemployment. Allowable demonstration activities
would include: subsidies for employer provided training; work
sharing or Short-Time Compensation; enhanced employment
strategies and services; SEA programs; services that enhance
skills that would assist in obtaining reemployment; direct
reimbursements to employers who hire individuals that were
receiving EUC08; and other innovative activities not otherwise
described. Authority for demonstration projects would end when
EUC08 ceases to be payable. Demonstration projects would be
required to provide appropriate reemployment services and
assurances of no net increase in cost to the EUC08 program.
This section would require states to provide information on
demonstration projects for reporting and evaluation purposes.
Section 2164 would require states to offset an
individual's EUC08 benefit if they received an unemployment
benefit overpayment. States would be required to offset by at
least 50% of the EUC08 benefit in any week.
Section 2165 would repeal the ``nonreduction rule'' in
terms of the regular UC benefit amount. This would give states
the option to decrease average weekly benefit amounts without
invalidating their EUC08 Federal-state agreements.
Senate bill
No provision.
Conference substitute
The conference agreement follows the House bill with
regard to explicit job search requirements, with several
modifications designed to closely align the work search
requirements between the EUC and EB programs. In order to be
eligible for benefits in any week, the state agency shall find
that the individual is able to work, available to work, and
making reasonable efforts to secure suitable work.
For purposes of this provision, the term ``making
reasonable efforts to secure suitable work'' means, with
respect to an individual, that such individual: (1) Is
registered for employment services in such manner and to such
extent as prescribed by the state agency; (2) Has engaged in an
active search for employment that is appropriate in light of
the individual's skills, capabilities and work history, and
includes a number of employer contacts that is consistent with
reasonable standards communicated to the individual by the
state; (3) Has maintained a record of such work search,
including employers contacted, method of contact and date
contacted; and (4) When requested, has provided such work
search record to the state agency. The Secretary of Labor shall
prescribe to each state a minimum number of claims for which
work search records must be audited on a random basis in any
given week.
The conference agreement follows the House bill with
regard to the requirement that EUC recipients participate in
reemployment services if referred and as well as actively
search for work. The conference agreement follows the Senate
amendment with regards to there being no minimum education
requirements for individuals receiving EUC benefits.
The conference agreement follows the House bill with
regard to the requirement that States provide reemployment
services and reemployment and eligibility assessment activities
to long-term unemployed individuals who begin receiving EUC
benefits and throughout their time collecting EUC benefits. The
conference agreement follows the Senate amendment with regard
to no State authority to reduce EUC benefits to support the
cost of such reemployment services and activities. In its
place, the conference agreement provides new one-time funding
to States to support the cost of such reemployment services and
activities.
The conference agreement follows the Senate amendment
with respect to no additional State flexibility to assist the
long-term unemployed with improved reemployment services using
EUC funds.
The conference agreement follows the House bill with
regard to requiring States to offset current Federal benefits
to recover prior overpayments of State, other States', or
Federal unemployment benefits. With regard to efforts to
recover such overpayments owed to other States and the Federal
government, the conference agreement requires each State to
apply hardship exceptions and related terms that follow State
practice used to recover overpayments of its own State benefit
funds.
The conference agreement modifies the House bill with
regard to effect of the current ``nonreduction rule,'' which
generally blocks the payment of Federal EUC funds to States
that have reduced State unemployment benefits. Several States,
in order to address solvency have passed laws to reduce future
State benefit amounts, and others may be considering doing the
same. Thus, the continued application of the ``nonreduction
rule'' (if not adjusted) would bar such States from receiving
EUC funds otherwise provided under this legislation. For this
reason, the conference agreement changes the effective date of
the non-reduction rule to March 1, 2012 in order to allow for
changes states have made (i.e. both those that have already
enacted laws changing benefit amounts, as well as those with
legislation pending that would do so),'' this permits States to
adjust benefits as they have planned, while remaining eligible
for Federal EUC funds throughout CY 2012.
Subtitle D--TANF Extension
H2302/S312
Current law
The Temporary Payroll Tax Cut Continuation Act of 2011
(P.L. 112-78) provided program authorization and funding for
most Temporary Assistance for Needy Families (TANF) grants
through February 29, 2012. It provided authority and funding
for state family assistance grants (the basic block grant),
healthy marriage and responsible fatherhood grants, mandatory
child care grants, tribal work program grants, matching grants
for the territories, and research funds. Grants are funded at
the same level as in FY2011, and paid on a pro-rated quarterly
basis. No funding was provided for TANF supplemental grants.
The TANF contingency fund was provided an FY2012 appropriation
in legislation enacted in 2010, P.L. 111-242.
House bill
Section 2302 provides FY2012 appropriations for TANF
state family assistance grants, healthy marriage and
responsible fatherhood grants, mandatory child care grants,
tribal TANF work programs, matching grants for the territories,
and research funds. FY2012 grants are provided at the same
level as were provided in FY2011.
Senate bill
Section 312 extends program authorization and funding for
TANF through February 29, 2012. Grants are funded at the same
level as in FY2011, and paid on a pro-rated quarterly basis.
(Provision is the same as current law. It is identical to that
subsequently enacted in P.L. 112-78.)
Conference substitute
The conference agreement follows the House bill with
technical corrections to ensure the provisions operate as
intended. Section 2302(c)(1) is revised by changing the year to
2013 instead of 2012 to correct a drafting error. Section
2302(c)(2)(A) is revised by changing the year to 2012 instead
of 2011 to correct a drafting error. Section 2302(i) is revised
by striking ``or section 403(b) of the Social Security Act'' to
reflect the intent that TANF contingency funds are not affected
by this bill and that they continue as previously authorized
and appropriated for FY2012, and also to update the provision
to add a reference the Temporary Payroll Tax Cut Continuation
Act of 2011 which extended TANF through February 29, 2012.
H2303,2304,2305/S--
Current law
States are required to report case- and individual-level
demographic, monthly financial and monthly work participation
information to the Department of Health and Human Services
(HHS) on a quarterly basis.
There are no relevant provisions in current law regarding
Section 2304 of the House bill.
House bill
Section 2303 requires HHS to issue a rule designating
standard data elements for any category of information required
to be reported under TANF. The rule would be developed by HHS
in consultation with an interagency workgroup established by
the Office of Management and Budget (OMB) and with
consideration of state and tribal perspectives. To the extent
practicable, the standard data elements required by the rule
would be non-proprietary and incorporate the interoperable
standards developed and maintained by other recognized bodies.
To the extent practicable, the data reporting standards
required by the rule would incorporate a widely-accepted,
nonproprietary, searchable, computer-readable format; be
consistent with and implement applicable accounting principles;
be capable of being continually upgraded as necessary; and
incorporate existing nonproprietary standards, such as the
``eXtensible Business Reporting Language.'' The data
standardization requirement would take effect on October 1,
2012.
Section 2304 requires states to maintain policies and
practices to prohibit TANF assistance from being used in any
transaction in liquor stores, casinos and gaming
establishments, and strip clubs. States have up to 2 years
after enactment to implement such policies and practices.
States that fail to report actions they have taken are at risk
of being penalized by up to a 5% reduction in their block
grant.
Section 2305 makes technical corrections to the TANF
statute.
Senate bill
No provision.
Conference substitute
The conference agreement follows the House bill with the
following technical modifications to Section 2303: Section
2303(a) is modified to clarify that the goal of the provision
is to standardize the data exchange processes, not standardize
data elements. Section 2303(b) is modified to require that the
Department of Health and Human Services issue proposed rules
for this section within 12 months of the enactment of this
section, and that the agency finalize these regulations within
24 months of the enactment of this section.
The conference agreement follows the House bill with the
following technical modifications to Section 2304: Section
2304(a)(12)(A) is modified to clarify that States are required
to block access to TANF funds provided on electronic benefit
transfer cards at ATMs and point-of-sale devices in specified
locations. Section 2304(a)(12)(B) is modified by adding a
definition of electronic benefit transfer transactions. Section
2304(b)(16)(A) is modified to clarify that each State must
provide a report to the Secretary of Health and Human Services
regarding their implementation of this provision.
TITLE III--FLOOD INSURANCE REFORM
REFORM OF PREMIUM RATE STRUCTURE
H3005(a),3005(b),3005(c),3005(d),3005(e)/S--
Current law
The Federal Emergency Management Agency (FEMA) is
authorized to increase chargeable risk premium rates for flood
insurance for any properties within any single risk
classification 10% annually. 42 U.S.C. 4015 (e)
Full actuarial rates begin on the effective date of a
revised Flood Hazard Boundary Map or Flood Insurance Rate Map
for a community. Sec. 61.11
FEMA is authorized to establish risk premium rates for
flood insurance coverage. The agency is also authorized to
offer ``chargeable'' (subsidized) premium rates for pre-FIRM
buildings. Post-FIRM structures (i.e., buildings constructed on
or after December 31, 1974) and the effective date of the FIRM,
whichever is later, must pay the full actuarial risk premium
rates. Sec. 61.8
Pre-FIRM structures continue to receive subsidized
premium rates after the lapsed policy provided the policyholder
pays the appropriate premium to reinstate the policy.
FEMA is authorized to determine whether a community has
made adequate progress on the construction of a flood
protection system involving federal funds. Adequate progress
means the community has provided FEMA with necessary
information to determine that 100% of the cost has been
authorized, 60% has been appropriated or 50% has been expended.
Sec. 61.12
House bill
Section 3005(a) would increase the annual cap on premium
increases from 10% to 20%.
Section 3005(b) would clarify that newly mapped
properties are phased-in to full actuarial, flood insurance
rates at a consistent rate of 20% per year over 5 years and
requires that newly mapped property owners pay 100% of
actuarial rates at the end of the 5 year phase-in period. For
areas eligible for the lower-cost Preferred Risk Policy (PRP)
rates, the phase-in begins after the expiration of their PRP
rates. For all properties, the phase-in of rates only applies
to residential properties occupied by their owner or a bona
fide tenant as a primary residence.
Section 3005(c) would require that, beginning one year
after enactment, the premium rate subsidies (pre-FIRM
discounts) for certain properties in the following categories
be phased-out, with annual rate increases limited by a 20
percent annual cap. This would apply to commercial properties,
second and vacation homes (i.e., residential properties not
occupied by an individual as a primary residence), homes sold
to new owners, homes damaged or improved (substantial flood
damage exceeding 50 percent or substantial improvement
exceeding 30 percent of the fair market value of the property),
and properties with multiple flood claims (i.e., statutorily
defined severe repetitive loss properties.)
Section 3005(d) would remove the eligibility of property
owners who allow their policies to lapse by choice to receive
discounted rates on those properties.
Section 3005(e) would update the standards by which FEMA
evaluates a community's eligibility for special flood insurance
rates by considering state and local funding, in addition to
federal funding, of flood control projects.
Senate bill
No provision.
Conference substitute
No provision.
MANDATORY PURCHASE REQUIREMENTS
H3003(b)(3),3003(c),3004(a),3007(e),3014,3017,3018/S--
Current law
There are no relevant provisions in current law regarding
Section 3003(b)(3) of the House bill.
FEMA is authorized to enter into arrangements with
individual private sector property insurance companies or other
insurers, such as public entity risk sharing organizations.
Under this Write-Your-Own company arrangement, such companies
may offer flood insurance coverage under the program to
eligible applicants. Sec. 62.23
The NFIP requires the purchase of flood insurance on and
after March 2, 1974, as a condition of receiving any form of
federal or federally-related financial assistance for
acquisition or construction purposes with respect to insurable
buildings and mobile homes within an identified special flood,
mudslide, or flood-related erosion hazard area that is located
within any community participating in the NFIP. Sec. 59.2 The
mandatory purchase of insurance is required in areas identified
as being within designated Zones A, A1-30, AE, A99, AO, AH, AR,
AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, V1-30, VE, V, VO, M, and
E. Sec. 64.3
When FEMA has provided a notice of final flood elevations
for one or more special flood hazard areas (SFHA) on the
community's FIRM, the community shall require that all new
construction and substantial improvements of residential
structures within Zones A1-30, AE and AH zones on the
community's FIRM have the lowest flood (including basement)
elevation to or above the base flood level, unless the
community is granted an exception by FEMA for the allowance of
basements. Sec. 60.3(a) Structures in SFHAs that receive any
form of federal or federally-related financial assistance are
required to purchase flood insurance. Sec. 59.2(a)
FEMA is required to provide notice of final base flood
elevations within Zones A1-30 and/or AE on the community's FIRM
that is available for public viewing by homeowners in SFHAs.
Sec. 60.3(e) Structures located in these zones are classified
as SFHA and are, therefore, required to purchase flood
insurance. Sec. 59.2(a)
The NFIP was established to provide flood insurance
protection to property owners in flood-prone areas. However,
flood insurance is only available in communities that
participate in the NFIP. Sec. 59.2 To qualify for flood
insurance availability a community must apply for the entire
area within its jurisdiction and shall submit copies of
legislative and executive actions indicating a local need for
flood insurance and an explicit desire to participate in the
NFIP. Sec. 59.22
There are no relevant provisions in current law regarding
Section 3018 of the House bill.
House bill
Section 3003(b)(3) would require lenders or servicing
companies to terminate policies purchased on behalf of the
homeowner to satisfy the mandatory purchase requirement within
30 days of being notified that the homeowner has purchased
another policy. Lenders would be required to refund any premium
payments and fees made by the homeowner for the time when both
policies were in effect. Moreover, the declaration page in the
insurance policy would be considered sufficient to demonstrate
having met the mandatory insurance purchase requirements.
Section 3003(c) would require lenders to accept flood
insurance from a private company if the policy fulfills all
federal requirements for flood insurance.
Section 3004(a) would authorize the Administrator of FEMA
to delay mandatory purchase requirement for owners of
properties in newly designated special flood hazard areas. The
delay would not be longer in duration than 12 months with the
possibility of two 12 month extensions at the discretion of
FEMA. Eligible areas defined as an area that meets the
following three requirements: (1) area with no history of
special flood hazards; (2) area with a flood protection system
under improvement; or (3) area has filed an appeal of the
designation of the area as having special flood hazards. Upon a
request submitted from a local government authority, FEMA could
suspend the mandatory purchase for a possible fourth and fifth
year for certain communities that are making more than adequate
progress in their construction of their flood protection
systems.
Section 3007(e) would clarify that mandatory purchase
requirement would not apply to a property located in an area
designated as having a special flood hazard if the owner of
such property submits to FEMA an elevation certificate showing
that the lowest level of the primary residence is at an
elevation that is at least three feet higher than the elevation
of the 100-year flood plain. FEMA would be required to accept
as conclusive each elevation certificate unless the
Administrator conducts a subsequent elevation survey and
determines that the lowest level of the primary residence in
question is not at an elevation that is at least three feet
higher than the elevation of the 100-year flood plain. This
section would require FEMA to expedite any requests made by an
owner of a property showing that the property is not located
within the area having special flood hazards. FEMA would be
prohibited from charging a fee for reviewing the flood hazard
data with respect to the expedited request and requiring the
owner to provide any additional elevation data.
Section 3014 would require the Administrator of FEMA, in
consultation with affected communities, to notify annually
residents in areas having special flood hazards that they
reside in such an area, the geographic boundaries of such
areas, the requirements to purchase flood insurance coverage
and the estimated cost of flood insurance coverage.
Section 3017 would amend the Real Estate Settlement
Procedures Act of 1974 (RESPA) to require mortgage lenders to
include specific information about the availability of flood
insurance in each good-faith estimate.
Section 3018 would amend RESPA to explicitly state that
the escrowing of flood insurance payments is required for many
types of loans.
Senate bill
No provision.
Conference substitute
No provision.
REFORM OF COVERAGE TERMS
H3004(a),3004(b),3004(d),3004(e),3015,3016,3021/S--
Current law
There are no relevant provisions in current law regarding
Section 3004(a) of the House bill.
The maximum amount of coverage for a single family
residential structure is $250,000 and $100,000 for personal
contents. The limit for nonresidential building structures is
$500,000 and $500,000 for contents. Sec. 61.6
Insurance coverage under the NFIP is available only for
property structures and personal contents. Sec. 61.3
Payment of full policyholder premium must be made at the
time of application or renewal. Sec. 61.5
There are no relevant provisions in current law regarding
Section 3015 of the House bill.
FEMA is authorized to enter into arrangements with
individual private insurers to offer flood coverage to
policyholders. Sec. 62.23
The Standard Flood Insurance Policy issued under the NFIP
excludes coverage for hot tubs and spas that are not bathroom
fixtures, and swimming pools, and their equipment, such as, but
not limited to, heaters, filters, pumps, and pipes, wherever
located. Appendix A(1) to Part 62
House bill
Section 3004(a) would set the minimum deductible levels
at $1,000 for properties with full-risk rates and $2,000 for
properties with discounted rates. The section would also
establish that maximum coverage limits be indexed for
inflation, starting in 2012.
Section 3004(b) would authorize insurance coverage under
policies issued by the NFIP to be adjusted for inflation since
September 30, 1994. This section would clarify that insured or
applicants for residential insurance coverage under the NFIP
would receive up to an ``aggregate liability'' of $250,000 per
claim rather than a ``total amount'' of $250,000.
Nonresidential property owners would be insured for a total of
$500,000 aggregate liability for structure and $500,000
aggregate liability for content. These amounts would be
adjusted or indexed for inflation using the percentage change
over the period beginning on September 30, 1994 through the
date of enactment of the law.
Section 3004(d) would authorize the Administrator of FEMA
to offer optional coverage for additional living expenses, up
to a maximum of $5,000, as well as to offer optional coverage
for the interruption of business operations up to a maximum of
$20,000, provided that FEMA: (1) charges full-risk rates for
such coverage; (2) makes a finding that a competitive private
market for such coverage does not exist; and (3) certifies that
the NFIP has the capacity to offer such coverage without the
need to borrow additional funds from the U.S. Treasury.
Section 3004(e) would authorize the Administrator of FEMA
to offer policyholders the option of paying their premiums for
one-year policies in installments, and authorizes FEMA to
impose higher rates or surcharges, or to deny future access to
NFIP coverage, if property owners attempt to limit their
coverage to coincide only with the annual storm season by
neglecting to pay their premiums on schedule.
Section 3015 would require the Administrator of FEMA to
notify tenants of a property located in areas having special
flood hazard, that flood insurance coverage is available under
the NFIP for contents of the unit or structure leased by the
tenant, the maximum amount of such coverage for contents, and
how to obtain information regarding how to obtain such
coverage.
Section 3016 would require the Administrator of FEMA to
notify the holders of direct policies managed by FEMA that they
could purchase flood insurance directly from an insurance
company licensed by FEMA to administer NFIP policies. The
coverage provided or the premiums charged to holders of flood
insurance policies that are administered by an insurance
company are no different from those directly managed by FEMA.
Section 3021 would require under the NFIP that the
presence of an enclosed swimming pool located at ground level
or in the space below the lowest flood of a building after
November 30, and before June 1 of any year, would have no
effect on the terms of coverage or the ability to receive
coverage for such building if the pool is enclosed with non-
supporting breakaway walls.
Senate bill
No provision.
Conference substitute
No provision.
FINANCIAL AND BORROWING AUTHORITY
H3011,3025,3033/S--
Current law
FEMA is authorized to carry out a program to provide
financial assistance to states and communities, using amounts
made available from the National Flood Mitigation Fund for
planning and carrying out activities designed to reduce the
risk of flood damage to structures. Such assistance shall be
made available to states and communities in the form of grants
to carry out mitigation activities. 44 U.S.C. 4104c(a)
FEMA is authorized to issue notes or other obligations to
the Secretary of the Treasury, without the approval of the
President, to finance the flood insurance program. All funds
borrowed under this authority shall be deposited in the
National Flood Insurance Fund. 42 U.S.C. Sec. 4016(a)
FEMA is authorized to borrow from the U.S. Treasury.
Borrowed funds must be repaid with interest. 42 U.S.C.
Sec. 4017 (a)(3)
House bill
Section 3011 would streamline and reauthorize the Flood
Mitigation Assistance Program, the Repetitive Flood Claims
Program and the Severe Repetitive Loss Program in order to
improve their effectiveness and efficiency. Financial
assistance would be made available to states and communities in
the form of grants for carrying out mitigation activities,
especially with respect to severe repetitive loss structures,
repetitive loss structures, and to property owners in the form
of direct grants. This section would expand eligibility for
mitigation assistance grants from mitigating flood risk to
mitigating multiple hazards. Amounts provided could be used
only for mitigation activities that are consistent with
mitigation plans approved by FEMA. FEMA Administrator could
approve only mitigation activities that are determined to be
technically feasible, cost-effective, and result in savings to
the NFIF. This section would expand eligibility to include
mitigation activities for the elevation, relocation, and flood-
proofing of utilities (including equipment that serve
structures). The FEMA Administrator is required to consider
demolition and rebuilding of properties as eligible activities
under the mitigation grant programs. This section establishes a
matching requirement for severe repetitive loss structures of
up to 100% of all eligible costs and up to 90% for repetitive
loss structures. Other mitigation activities would be in an
amount up to 75% of all eligible costs. Failure to award a
grant within 5 years of receiving a grant application would be
considered to be a denial of the application and any funding
amounts allocated for such grant applications would remain in
the National Flood Mitigation fund. This section authorizes $40
million in grants to States and communities for mitigation
activities, $40 million in grants to States and communities for
mitigation activities for severe repetitive loss structures,
and $10 million in grants to property owners for mitigation
activities for repetitive loss structures. This section would
eliminate the Grants Program for Repetitive Insurance Claims
Properties. (Sec. 3011(b))
Section 3025 would establish a reserve fund requirement
to meet the expected future obligations of the National Flood
Insurance Program. This section contains phase-in requirements
similar to H.R. 3121. For example, this section requires the
Fund to maintain a balance equal to 1% of the sum of the total
potential loss exposure of all outstanding flood insurance
policies in force in the prior fiscal year, or a higher
percentage as the Administrator determines to be appropriate.
FEMA has the discretion to set the amount of aggregate annual
insurance premiums to be collected for any fiscal year
necessary to maintain the reserve ratio, subject to any
provisions relating to chargeable premium rates and annual
increases of such rates.
Section 3033 would require FEMA to submit a report to
Congress not later than 6 months after enactment of this Act
setting forth a plan for repayment within 10 years on the
amounts borrowed from the U.S. Treasury under the NFIP.
Senate bill
No provision.
Conference substitute
No provision.
POLICY CLAIMS AND WRITE-YOUR-OWN INSURERS
H3004,3022,3023,3028,3032/S--
Current law
The ``Exclusions'' section ``V'' of the Standard Flood
Insurance Policy stipulates that ``We do not insure a loss
directly or indirectly caused by a flood that is already in
progress at the time and date: (1) the policy term begins; or
(2) coverage is added at your request. Appendix A(1) to Part
61. Coverage for a new contract for flood insurance coverage
shall become effective upon the expiration of the 30-day period
beginning on the date that all obligations for such coverage
are satisfactorily completed. Sec. 61.11; 42 U.S.C. 4013(c)
There are no relevant provisions in current law regarding
Section 3022 of the House bill.
There are no relevant provisions in current law regarding
Section 3023 of the House bill.
There are no relevant provisions in current law regarding
Section 3028 of the House bill.
House bill
Sections 3004 and 3032 would clarify the effective date
of insurance policies covering properties affected by floods in
progress. Property experiencing a flood during the 30-day
waiting period following the purchase of insurance would be
covered for damage to the property that occurs after the 30-day
period has expired, but only if the property has not suffered
damage or loss as a result of such flood before the expiration
of such 30-day period. These sections would require FEMA to
review the processes and procedures for determining that a
flood event has commenced or is in progress for purposes of
flood insurance coverage and report to Congress within 6
months.
Section 3022 would require FEMA to grant policy holders
the right to request engineering reports and other documents
relied on by the Administrator and/or participating WYO
companies in determining whether the damage was caused by flood
or any other peril (e.g., wind). FEMA would also be required to
provide the information to the insured within 30 days of the
request for information.
Section 3023 would authorize FEMA to refuse to accept
future transfers of policies to the NFIP Direct program.
Section 3028 would require FEMA to submit a report to
Congress describing procedures and policies for limiting the
number of flood insurance policies that are directly managed by
the Agency to not more than 10% of the total number of flood
insurance policies in force. After submitting the report to
Congress, the Administrator would have 12 months to reduce the
number of policies directly managed by the Agency, or by the
Agency's direct servicing contractor that is not an insurer, to
not more than 10% of the total number of flood insurance
policies in force.
Senate bill
No provision.
Conference substitute
No provision.
FLOOD RISK ASSESSMENT AND MAPPING
H3006,3007,3008,3013,3014,3018,3020,3024,3026, 3030/S--
Current law
There are no relevant provisions in current law regarding
Section 3006 of the House bill.
FEMA is authorized to identify and publish information
with respect to all areas within the United States having
special flood, mudslide, and flood-related erosion hazards.
Sec. 65.1
FEMA will only recognize in its flood hazard and risk
mapping effort those levee systems that meet, and continue to
meet, minimum design, operation, and maintenance standards that
are consistent with the level of protection sought through the
comprehensive floodplain management regulations. Sec. 65.10
There are no relevant provisions in current law regarding
Section 3013 of the House bill.
FEMA publishes in the Federal Registry a notice of the
proposed flood elevation determination sent to the Chief
Executive Officer of the community. The agency also publishes a
copy of the community's appeal or a copy of its decision not to
appeal the proposed flood elevation determination. Sec. 67.3
A Standard Flood Insurance policyholder whose property
has become the subject of a Letter of Map Amendment may cancel
the policy within the current policy year and receive a premium
refund. Sec. 70.8 The policy could be canceled provided (1) the
policyholder was required to purchase flood insurance; and (2)
the property was located in a SFHA as represented on an
effective FIRM when the financial assistance was provided. If
no claim under the policy has been paid or is pending, the full
premium shall be refunded for the current policy year, and for
an additional policy year where the insured had been required
to renew the policy. Sec. 62.5
FEMA publishes a notice of the community's proposed flood
elevation determination in a prominent local newspaper at least
twice during the ten day period immediately following the
notification of the CEO. Sec. 67.4
FEMA publishes a notice of the community's proposed flood
elevation determination in a prominent local newspaper at least
twice during the ten day period immediately following the
notification of the CEO. Sec. 67.4 Any owner or lessee of real
property, within a community where a proposed flood elevation
determination has been made who believes his property rights to
be adversely affected by the proposed base flood determination
may file a written appeal of such determination with the CEO
within 90 days of the second newspaper publication of the FEMA
proposed determination. Sec. 67.5
There are no relevant provisions in current law regarding
Section 3026 of the House bill.
The NFIP participating community must provide written
assurance that they have complied with the appropriate minimum
floodplain management regulation. Sec. 60.3
House bill
Section 3006 would establish the Technical Mapping
Advisory Council (Council) to develop and recommend new mapping
standards for FIRMs. The Council would include representatives
from FEMA, the U.S. Geological Survey (USGS), the U.S. Army
Corps of Engineers (USACE), other federal agencies, state and
local governments, as well as experts from private stakeholder
groups. This section would require that there is adequate
number of representatives from the states with coastlines or
the Gulf of Mexico and other states containing areas at high-
risk for floods or special flood hazard areas. The Council
would submit the new mapping standards for 100-year flood
insurance rate maps to FEMA and the Congress within 12 months
of enactment and would continue to review those standards for
four additional years, at which time the Council would be
terminated. This section would place a moratorium on the
issuance of any updated flood insurance rate maps from the date
of enactment until the Council submits to FEMA and Congress the
proposed new mapping standards. This section would allow for
the revision, update and change of rate maps only pursuant to a
letter of map change.
Section 3007 would direct FEMA to establish new standards
for FIRMs beginning six months after the Technical Mapping
Advisory Council issues its initial set of recommendations. The
new standards would delineate all areas located within the 100-
year flood plain and areas subject to gradual and other risk
levels, as well as ensure the standards reflect the level of
protection levees confer. The standard must also differentiate
between a property that is located in a flood zone and a
structure located on such property that is not at the same risk
level for flooding as such property due to the elevation of the
structure and provide that such rate maps are developed on a
watershed basis. This section would require FEMA to submit a
report to Congress specifying which Council recommendations
were not implemented and explaining the reasons such
recommendations were not adopted. FEMA would have 10 years to
update all FIRMs in accordance with the new standards subject
to the availability of appropriated funds. This section would
eliminate requirements to more broadly map areas considered to
be residual risk.
Section 3008 would prohibit the Administrator of FEMA
from issuing flood insurance maps, or make effective updated
flood insurance maps, that omit or disregard the actual
protection afforded by an existing levee, floodwall, pump or
other flood protection feature, regardless of the accreditation
status of such feature.
Section 3013 would require the Administrator of FEMA,
upon any revision or update of any floodplain area or flood-
risk zone and the issuance of a preliminary flood map, to
notify in writing the Senators of each state affected and each
Member of Congress for each congressional district affected by
the flood map revision or update.
Section 3014 would require the Administrator of FEMA to
establish projected flood elevations and to notify the chief
executive officer of each community affected by the proposed
elevation a notice of the elevations, including a copy of the
maps for the elevations and a statement explaining the process
to appeal for changes in such elevations.
Section 3018 would require the Administrator of FEMA to
reimburse owners of any property, or a community in which such
property is located, for the reasonable costs involved in
obtaining a Letter of Map Amendment (LOMA) and Letter of Map
Revision (LOMR) if the change was due to a bona fide error on
the part of FEMA. The Administrator would be authorized to
determine a reasonable amount of costs to be reimbursed except
that such costs would not include legal or attorney fees. The
reasonable cost would consider the actual costs to the owner of
utilizing the services of an engineer, surveyor or similar
services. This section would require FEMA to issue regulation
pertaining to the reimbursements.
Section 3020 would require FEMA to provide to a property
owner newly included in a revised or updated proposed flood map
a copy of the proposed FIRM and information regarding the
appeals process at the time the proposed map is issued.
Section 3024 would require FEMA to notify a prominent
local television and radio station of projected and proposed
changes to flood maps for communities. This section would
authorize FEMA to grant an additional 90 days for property
owners or a community to appeal proposed flood maps, beyond the
original 90 day appeal period, so long as community leaders
certify they believe there are property owners unaware of the
proposed flood maps and appeal period, and community leaders
would use the additional 90 day appeal period to educate
property owners on the proposed flood maps and appeal process.
Section 3026 would authorize the use of Community
Development Block Grants to supplement state and local funding
for local building code enforcement departments and flood
program outreach.
Under Section 3030, the Administrator of FEMA would be
required to conduct a study regarding the impact,
effectiveness, and feasibility of including widely used and
nationally recognized building codes as part of FEMA's
floodplain management criteria and submit a report to the House
Committee on Financial Services and Senate Banking, Housing,
and Urban Affairs Committee. The study would assess the
regulatory, financial, and economic impacts of such building
code requirement on homeowners, states and local communities,
local land use policies, and FEMA.
Senate bill
No provision.
Conference substitute
No provision.
STUDIES AND REPORTS FOR CONGRESS
H3009(a),3009(b),3009(c),3009(d),3010,3025,3029,3031/S--
Current law
There are no relevant provisions in current law regarding
Section 3009(a) of the House bill.
FEMA is authorized to encourage insurance companies and
other insurers to form, associate, or otherwise join together
in a pool to provide the flood insurance coverage authorized
under the NFIP. 44 U.S.C. Sec. 4051(a)
FEMA is authorized to take such action as may be necessary
in order to make available reinsurance for losses which are in
excess of losses assumed by private industry flood insurance
pools. 42 U.S.C. Sec. 4055(a)
There are no relevant provisions in current law regarding
Section 3009(d) of the House bill.
There are no relevant provisions in current law regarding
Section 3010 of the House bill.
There are no relevant provisions in current law regarding
Section 3025 of the House bill.
There are no relevant provisions in current law regarding
Section 3029 of the House bill.
There are no relevant provisions in current law regarding
Section 3031 of the House bill.
House bill
Section 3009(a) would require the Administrator of FEMA
and the Comptroller General of the United States to conduct
separate studies to assess a broad range of options, methods,
and strategies for privatizing the NFIP. FEMA and GAO would
submit reports (within 18 months of the date of the enactment
of this Act) to the House Committee on Financial Services and
the Senate Banking, Housing, and Urban Affairs Committee that
make recommendations for the best manner to accomplish
privatization of the NFIP.
Section 3009(b) would authorize the Administrator of FEMA
to carry out private risk-management initiatives to determine
the capacity of private insurers, reinsurers, and financial
markets to assist communities, on a voluntary basis only, in
managing the full range of financial risk associated with
flooding. The Administrator would assess the capacity of the
private reinsurance, capital, and financial markets by seeking
proposals to assume a portion of the program's insurance risk
and submit to Congress a report describing the response to such
request for proposals and the results of such assessment. The
Administrator would be required to develop a protocol to
provide for the release of data sufficient to conduct the
assessment of the insurance capacity of the private sector.
Under Section 3009(c), the Administrator of FEMA would be
authorized to secure reinsurance coverage from private market
insurance, reinsurance, and capital market sources in an amount
sufficient to maintain the ability of the program to pay claims
and that minimizes the likelihood of having to borrow from the
U.S. Treasury.
Under Section 3009(d), the Administrator would be
required to conduct an assessment of the claims-paying ability
of the NFIP, including the program's utilization of private
sector reinsurance and reinsurance equivalents, with and
without reliance on borrowing authority.
Section 3010 would require the Administrator of FEMA to
submit an annual report to the Congress on the financial status
of the NFIP, including current and projected levels of claims,
premium receipts, expenses, and borrowing under the program.
Under Section 3025, the Administrator of FEMA would be
required to conduct a study regarding the impact,
effectiveness, and feasibility of including widely used and
nationally recognized building codes as part of FEMA's
floodplain management criteria and submit a report to the House
Committee on Financial Services and Senate Banking, Housing,
and Urban Affairs Committee. The study would assess the
regulatory, financial, and economic impacts of such building
code requirements on homeowners, states and local communities,
local land use policies, and FEMA.
Section 3029 would require the Administrator of FEMA and
the Comptroller General of the United States to conduct
separate studies to assess options, methods, and strategies for
offering voluntary community-based flood insurance under the
NFIP. The studies would consider and analyze how the policy
options would affect communities having varying economic bases,
geographic locations, flood hazard characteristics or
classification, and flood management approaches. The report and
recommendations would be submitted within 18 months after the
enactment of this Act to the House Committee on Financial
Services and the Senate Banking, Housing, and Urban Affairs
Committee.
Section 3031 would require the National Academy of
Sciences (NAS) to conduct a study of methods for understanding
graduated risk behind levees and the associated land
development, insurance, and risk communication dimensions. The
NAS would submit a report with recommendations within 12 months
of the date of enactment of this Act to the House Committee on
Financial Services and Senate Banking, Housing, and Urban
Affairs Committee.
Senate bill
No provision.
Conference substitute
No provision.
MISCELLANEOUS PROVISIONS
H3035/S--
Current law
There are no relevant provisions in current law regarding
Section 3035 of the House bill.
House bill
Section 3035 would allow state and local governments to
use the Army Corps of Engineers to evaluate locally operated
levee systems which were either built or designed by the Corps,
and which are being reaccredited as part of a NFIP remapping.
All costs associated with evaluations would continue to be
covered by the state or local government requesting the
evaluation.
Senate bill
No provision.
Conference substitute
No provision.
TITLE IV--JUMPSTARTING OPPORTUNITY WITH BROADBAND SPECTRUM ACT OF 2011
Subtitle A--Spectrum Auction Authority
H4005,4101,4102,4103,4104,4105,4106,4107/S--
Current law
There are no relevant provisions in current law regarding
Section 4005 of the House bill.
Current law provides for auction of electro-magnetic
spectrum assigned for federal use but does not establish
deadlines for specified frequencies. Current law provides for a
Spectrum Relocation Fund. It requires that spectrum license
proceeds be paid to the General Fund except in the case of
auctions of federal spectrum being reallocated for commercial
use in which case unexpended proceeds are held for 8 years
before being deposited in the Treasury.
Current law requires that 24 MHz of spectrum licenses in
700 MHz band be assigned for use by public safety agencies. FCC
regulations have designated 12 MHz for use by narrowband radios
carrying primarily voice communications and 2 MHz as guard
bands to mitigate radio interference. Licenses are administered
by state and local authorities. Current law requires that
auction proceeds be deposited in the General Fund.
The FCC has broad regulatory powers that might permit it
to reallocate TV broadcasting spectrum. Current law requires
that auction proceeds be deposited in the General Fund.
There are no relevant provisions in current law regarding
Section 4104 of the House bill.
The law requires the FCC to set rules regarding
participation in spectrum licenses auctions and for spectrum
use (service rules).
Authority of FCC to use competitive bidding systems to
assign licenses for the use of designated portions of electro-
magnetic spectrum expires September 30, 2012.
There are no relevant provisions in current law regarding
Section 4107 of the House bill.
House bill
Under Section 4005, payments of funds to and access to
spectrum license auctions would be prohibited for any person
who is barred by a federal agency for reasons of national
security.
Section 4101 would set requirements for commercial
auctions of electro-magnetic spectrum currently assigned for
federal use as described by the bill. With exceptions, process
of preparing auctions would begin within three years of
enactment. Spectrum license auction proceeds would be
distributed to the Spectrum Relocation Fund, which would
receive an amount equal to 110% of projected federal agency
relocation costs, with the balance deposited with the Public
Safety Trust Fund.
Section 4102 would require that these spectrum licenses
be released for commercial auction within five years of a
decision by a federally appointed Administrator. The decision
would be triggered by a declaration by the Administrator that
technology was available that would allow the migration of
voice communications from the 700 MHz narrowband networks to
the 700 MHz broadband network, thereby freeing up the
narrowband spectrum for auction to the commercial sector. Would
allocate $1 billion of auction proceeds to a new grant program
for states to acquire radio equipment.
Section 4103 would provide the FCC with the authority to
establish incentive auctions for television broadcasters,
within specified limits. It would create a TV Broadcaster
Relocation Fund as a means for broadcasters to receive up to $3
billion of auction revenue to cover relocation costs and for
other purposes. Proceeds above that amount would go to the
Public Safety Trust Fund through FY2021, after which funds are
to be deposited in the General Fund.
Section 4104 would establish procedures for the FCC to
follow in reallocating television broadcasting spectrum
licenses for commercial auction.
Section 4105 would set limitations on FCC auction and
service rules for future auctions. Would prohibit auction rules
that placed new conditions on prospective bidders (spectrum
caps). Would prohibit service rules that restrict licensee's
ability to manage network traffic (net neutrality) or that
would require providing network access on a wholesale basis.
Section 4106 would extend the FCC's auction authority
through FY 2021.
Section 4107 would lay the groundwork to expand
commercial use of unlicensed spectrum within the federally
managed 5GHz band of wireless spectrum by requiring the FCC to
commence a proceeding as described in the bill.
Senate bill
No provision.
Subtitle B--Advanced Public Safety Communications
PART 1--NATIONAL IMPLEMENTATION
H4201,4202,4203,4204,4205/S--
Current law
The FCC is empowered to manage public safety use and
assign access to spectrum. FCC has assigned a single,
nationwide license for 10 MHz of public safety broadband
spectrum, which it regulates. The law requires that the D Block
be auctioned for commercial purposes, with proceeds deposited
in the General Fund.
The Office of Emergency Communications (OEC) within the
Department of Homeland Security, as required by law, has
prepared a National Emergency Communications Plan. The law also
requires the OEC to work with other federal agencies in
developing appropriate standards for interoperability, among
other requirements. The FCC has used its regulatory authority
to create requirements for the use of public safety spectrum at
700 MHz, including interoperability and standard-setting.
Law has required that each state, in order to receive
federal funding for certain grants for public safety, must
establish a State Communications Interoperability Plan (SCIP)
and designate plan administrators at the state or local level.
OEC is charged with assisting and overseeing these plans. Each
state has submitted a SCIP to the OEC. Law also required the
creation of Regional Emergency Communications Centers to
facilitate regional planning for interoperability at the
regional level.
There are no relevant provisions in current law regarding
Section 4204 of the House bill.
House bill
Section 4201 would assign a total of 20 MHz of 700 MHz
spectrum designated for public safety use to an Administrator,
competitively chosen by the NTIA. The Administrator would
manage the distribution of spectrum capacity to individual
states and enforce requirements established in the bill.
Specifically, provisions would reallocate 10 MHz (the D Block)
from commercial use to public safety use.
Section 4202 would establish requirements for the FCC to
create a Public Safety Communications Planning Board. The Board
would prepare, and submit to the FCC for approval, a National
Public Safety Communications Plan. The Plan would include
requirements for interoperability and standards, among other
provisions.
Section 4203 would require the NTIA to request proposals
for the administration of the Plan. Would establish the duties
of the Administrator in working with State Public Safety
Broadband Offices to build interoperable networks within each
state.
Section 4204 would provide borrowing authority of up to
$40 million for the creation and initial operation of the
Administrator's office, to be repaid from auction revenue
received by the Public Safety Trust Fund.
Section 4205 would require the OEC to submit to Congress
a study that would: review the importance of amateur radio in
responding to disasters; make recommendations for how to
enhance the use of amateur radio federally; and to identify
impediments to amateur radio such as private land use
restrictions on antennas.
Senate bill
No provision.
PART 2--STATE IMPLEMENTATION
H4221,4222,4223,4224,4225/S--
Current law
FCC has promulgated regulations and requirements for
public safety broadband access.
There are no relevant provisions in current law regarding
Section 4222 of the House bill.
There are no relevant provisions in current law regarding
Section 4223 of the House bill.
There are no relevant provisions in current law regarding
Section 4224 of the House bill.
State and local governments have right to apply zoning
law procedures for requests to modify existing cell towers.
House bill
Section 4221 would require each state seeking to
establish a public safety broadband network, using 700 MHz
public safety broadband spectrum, to create a Public Safety
Broadband Office. Each office would prepare proposals for
building networks based on the requirements established through
the National Public Safety Communications Plan, including for
requests for proposal. The Administrator would work with each
state office in preparing and carrying out the plans. In
general, states would be required to sign a contract with a
commercial mobile provider to build the network to
specifications as provided in the bill and in accordance with
requirements established by the Public Safety Communications
Planning Board and by the Administrator.
Section 4222 would establish a matching grant program to
assist state Public Safety Broadband Offices.
Section 4223 would create a State Implementation Fund for
the State Implementation Grant Program. The fund would receive
up to $100 million in auction revenue as specified in the bill.
Funds remaining at the end of 2021 would be deposited in the
General Fund.
Section 4224 would provide grants to states for payments
under contracts entered into with the approval of the
Administrator.
Section 4225 would require approval of requests for
modification of cell towers. This section would provide for
federal agencies to grant easements for the placement of
antennas on federal property. This section would require the
General Services Administration (GSA) to provide a common
request form for easements and rights-of-way and to establish
fees for this service, based on direct cost recovery. This
section would require the GSA to develop one or more contracts
for antenna placement and other specifications.
Senate bill
No provision.
PART 3--PUBLIC SAFETY TRUST FUND
H4241/S--
Current law
There are no relevant provisions in current law regarding
Section 4241 of the House bill.
House bill
Section 4241 would create a fund to receive, hold and
disburse all auction proceeds as provided in the bill except
for $3 billion to be directed to the TV Broadcaster Relocation
Fund. Designated uses are: State and Local Implementation, $100
million; Public Safety Administrator, $40 million; Public
Safety Broadband Network Deployment, $4.96 billion plus 10% of
any remaining amounts deposited in the fund up to $1.5 billion;
Deficit Reduction, $20.4 billion from fund and balances upon
expiration in FY 2021, plus at least 90% of any additional
auction revenue.
Senate bill
No provision.
PART 4--NEXT GENERATION 9-1-1 ADVANCEMENT ACT
H4265,4266,4267,4268,4269,4270,4271/S--
Current law
Similar provisions were in effect through statutes that
expired at the end of FY2009. Provisions included requirements
for a grant program and for planning for the eventual
transition to Next Generation 9-1-1.
There are no relevant provisions in current law regarding
Section 4266 of the House bill.
Law Requires FCC to study 9-1-1 fee collection and use
and issue a report annually.
Law extends similar protection for existing 9-1-1
services.
There are no relevant provisions in current law regarding
Section 4269 of the House bill.
There are no relevant provisions in current law regarding
Section 4270 of the House bill.
House bill
Section 4265 would establish a federal 9-1-1 Coordination
Office to advance planning for next-generation 9-1-1 systems
and to fund a grant program with an authorization of $250
million. This section would direct the Assistant Secretary
(NTIA) and the Administrator of the National Highway Traffic
Safety Administration (NHTSA) to establish a 9-1-1
Implementation Coordination Office to reestablish and extend
matching grants, through October 1, 2021, to eligible state or
local governments or tribal organizations for the
implementation, operation, and migration of various 9-1-1, E9-
1-1 (wireless telephone location), Next Generation 9-1-1
(voice, text, video), and IP-enabled emergency services and
public safety personnel training. This section would provide
immunity and liability protection, to the extent consistent
with specified provisions of the Wireless Communications and
Public Safety Act of 1999, to various users and providers of
Next Generation 9-1-1 and related services, including for the
release of subscriber information.
Section 4266 would require GAO to prepare a report on 9-
1-1 capabilities of multi-line telephone systems in federal
facilities, and would require the FCC to seek comment on the
feasibility of improving 9-1-1 identification for calls placed
through multi-line telephone systems.
Section 4267 requires GAO to study how states assess fees
on 9-1-1 services and how those fees are used.
Section 4268 would provide immunity and liability
protection, to the extent consistent with specified provisions
of the Wireless Communications and Public Safety Act of 1999,
to various users and providers of Next Generation 9-1-1 and
related services, including for the release of subscriber
information.
Section 4269 would direct the FCC to: (1) initiate a
proceeding to create a specialized Do-Not-Call registry for
public safety answering points, and (2) establish penalties and
fines for autodialing (robocalls) and related violations.
Section 4270 requires an analysis of costs and
assessments and analyses of technical uses.
Section 4271 would require the FCC to assess the legal
and regulatory environment for development of NG9-1-1 and
barriers to that development, including state regulatory
roadblocks.
Senate bill
No provision.
Subtitle C--Federal Spectrum Relocations
H4301,4302,4303/S--
Current law
Law provides conditions of use and relinquishment of
spectrum, and related actions, by federal agencies. Federal
agencies that are relocating to new spectrum allocations in
order to accommodate commercial users for other uses may be
reimbursed for certain costs of relocation from the Spectrum
Relocation Fund, established for that purpose.
Spectrum Relocation Fund created by the Commercial
Spectrum Enhancement Act of 2004 (P.L. 108-494, Title II).
There are no relevant provisions in current law regarding
Section 4303 of the House bill.
House bill
Section 4301 would include shared use as an eligible
action and expenditures for planning would be newly included
among those costs eligible for reimbursement from the Spectrum
Relocation Fund. This section would establish a Technical Panel
to review a transition plan that the NTIA would be required to
prepare in accordance with provisions in the bill. This section
would require that the NTIA give priority to options that would
reallocate spectrum for exclusive, nonfederal uses assigned
through auction.
Section 4302 would address uses of the Fund, as described
in Sec. 4301, and would establish requirements regarding
transfers of funds in advance of auctions and reversion of
unused funds.
Section 4303 would establish provisions under which non-
disclosure of information regarding federal spectrum use would
be determined.
Senate bill
No provision.
Subtitle D--Telecommunications Development Fund
H4401,4402/S--
Current law
The Telecommunications Development Fund (TDF) was created
to provide funding for new ventures in telecommunications. One
source of funds comes from the requirement that interest from
certain escrow accounts overseen by the FCC be transferred to
the TDF.
The law that created TDF requires board members to
consult with the FCC and the Treasury before finalizing
decisions.
House bill
Section 4401 would require that interest accrued in
specified accounts be deposited in the General Fund.
Section 4402 eliminates the role of federal agencies in
oversight of board activities.
Senate bill
No provision.
Conference substitute
Title VI--Public Safety Communications and
Electromagnetic Spectrum Auctions. The public safety and
spectrum provisions of this legislation advance wireless
broadband service by clearing spectrum for commercial auction,
promoting billions of dollars in private investment, and
creating tens of thousands of jobs. These provisions also
deliver on one of the last outstanding recommendations of the
9/11 Commission by creating a nationwide interoperable
broadband communications network for first responders and
generating billions of dollars of Federal revenue.
TITLE V--OFFSETS
Subtitle A--Guarantee Fees
H5001/S401,402
Current law
Similar provisions were enacted in Title IV of P.L. 112-
78.
House bill
Section 5001 increases guarantee fees to reflect risk of
loss and cost of capital as if enterprises were fully private
regulated institutions. This section requires a minimum
increase of 10 basis points (0.10%) greater than average 2011
guarantee fees. To the extent that amounts are received from
fee increases imposed under this section that are necessary to
comply with the minimum increase required by this subsection,
such amounts shall be deposited directly into the United States
Treasury, and shall be available only to the extent provided in
subsequent appropriations Acts. Such fees shall not be
considered a reimbursement to the Federal Government for the
costs or subsidy provided to an enterprise. This section
provides for a two-year phase-in at discretion of Director of
FHFA. This section requires all lenders to be charged a uniform
guarantee fee. This section requires an annual FHFA Report to
Congress to include information on up-front and annual
guarantee fee increases, and changes in riskiness of new
mortgages. This section applies to mortgages closed after the
date of enactment. This section expires October 1, 2021.
Senate bill
Sections 401 and 402 increase guarantee fees to reflect
risk of loss and cost of capital as if enterprises were fully
private regulated institutions. This section requires a minimum
increase of 10 basis points (0.10%) greater than average 2011
guarantee fees. Amounts received from fee increases imposed
under this section shall be deposited directly into the United
States Treasury, and shall be available only to the extent
provided in subsequent appropriations Acts. The fees charged
pursuant to this section shall not be considered a
reimbursement to the Federal Government for the costs or
subsidy provided to an enterprise. This section provides for a
two-year phase-in at discretion of Director of FHFA. This
section requires all lenders to be charged a uniform guarantee
fee. This section requires an annual FHFA Report to Congress to
include information on up-front and annual guarantee fee
increases, and changes in riskiness of new mortgages. This
section applies to mortgages closed after the date of
enactment. This section expires October 1, 2021. This section
increases guarantee fees on FHA-insured mortgages by 10 basis
points (0.10%) with phase-in over two years.
Conference substitute
No provision.
TITLE VI--MISCELLANEOUS PROVISIONS
H6002,6003(a),6003(b),6004/S511,512
Current law
Section 263 of the Trade Adjustment Assistance Extension
Act of 2011 (P.L. 112-40) requires any fees for processing
merchandise entered between October 1 and November 12, 2012, to
be paid no later than September 25, 2012, in an amount
equivalent to the amount of such fees paid with respect to
merchandise entered between October 1 and November 12, 2011.
The section requires the Secretary of the Treasury to refund
with interest any overpayment of such fees. The section
prohibits any assessment of interest for any underpayments
based on the amount of fees paid for merchandise entered
between October 1 and November 12, 2012.
Section 601(c) of the Tax Relief, Unemployment Insurance
Reauthorization, and Job Creation Act of 2010 (26 U.S.C. 1401
note) specifies the calendar year in which the payroll tax
holiday period applies. There is no Senate point of order
against the consideration of legislation that would amend this
section of the law.
Section 251 of the Balanced Budget and Emergency Deficit
Control Act of 1985 (BBEDCA), as amended by the Budget Control
Act of 2011 (BCA), establishes enforceable statutory limits on
discretionary spending for each fiscal year covering FY2012-
FY2021. Section 251(b)(2)(A)(i) of the BBEDCA provides for
these limits to be adjusted to accommodate discretionary
spending designated as emergency requirements in statute (i.e.,
effectively exempting such spending from the limits). Section
314 of the Congressional Budget Act of 1974, as amended by the
BCA, allows the chairs of the budget committees in each chamber
to make similar adjustments for purposes of congressional
enforcement of these and other spending limits during the
consideration of spending legislation. The existing Senate
point of order against an emergency designation (Section 403 of
S. Con. Res. 13, 111th Congress, the FY2010 budget resolution)
does not apply to an emergency designation pursuant to the
BBEDCA; therefore, there is no current Senate point of order
against such a designation.
Under the Statutory Pay-As-You-Go Act of 2010 (Title I of
P.L. 111-139), the five-year and 10-year budgetary effects of
direct spending and revenue legislation enacted during a
session are placed on respective scorecards. At the end of a
session of Congress, if either scorecard shows an increase in
the deficit, a sequestration of non-exempt budgetary resources
is required to eliminate such deficit. Under the law, off-
budget effects and discretionary spending effects are not
counted.
House bill
Section 6002 repeals a requirement that importers pre-pay
certain fees authorized under the Consolidated Omnibus Budget
Reconciliation Act of 1985.
Section 6003(a) creates a Senate point of order against
the consideration of any measure that ``extends the dates
referenced in section 601(c) of the Tax Relief, Unemployment
Insurance Reauthorization, and Job Creation Act of 2010.''
Provides that a two-thirds affirmative vote would be required
to waive the point of order.
Section 6003(b) amends the Budget Act to create a point
of order against an emergency designation pursuant to the
BBEDCA included in any measure. The new point of order is
similar to the existing Senate emergency designation point of
order: (1) if point of order is made, emergency designation is
stricken from the measure; and (2) a three-fifths affirmative
vote is required to waive the point of order and to sustain an
appeal of the ruling of the chair.
Section 6004 provides that the budgetary effects of H.R.
3630 are not placed on either PAYGO scorecard, as long as the
legislation does not increase the deficit over the FY2013-
FY2021 period. Also provides that off-budget effects, changes
to the statutory discretionary spending limits, and changes in
net income to the National Flood Insurance Program are to be
counted in determining the budgetary effects of the
legislation.
Senate bill
The Senate bill does not contain a provision regarding
the repeal of a requirement relating to time for remitting
certain merchandise processing fees.
Section 511 amends the Budget Act to create a point of
order against an emergency designation pursuant to the BBEDCA
included in any measure. The new point of order is similar to
the existing Senate emergency designation point of order: (1)
if point of order is made, emergency designation is stricken
from the measure; and (2) a three-fifths affirmative vote is
required to waive the point of order and to sustain an appeal
of the ruling of the chair.
Section 512 provides that the budgetary effects of H.R.
3630 are not placed on either PAYGO scorecard. Senate provision
makes no modifications to the conventional budget scoring of
the legislation.
Conference substitute
Section 7002. Repeal of Requirement Relating to Time for
Remitting Certain Merchandise Processing Fees: Repeals a
requirement that importers pre-pay certain fees authorized
under the Consolidated Omnibus Budget Reconciliation Act of
1985. The provision is identical to that contained in Section
6002 of the House bill.
Section 7003. Points of Order in the Senate: Includes two
Senate points of order related to (1) protecting the Social
Security Trust Fund and (2) emergency spending. The provision
is identical to that contained in Section 6003 of the House
bill.
Section 7004. PAYGO Scorecard Estimates: Provides that
the budgetary effects of the bill shall not be entered on the
statutory PAYGO scorecards provided that the bill is deficit
neutral over 10 years. The provision is identical to that
contained in Section 6004 of the House bill.
FEDERAL CIVILIAN EMPLOYEES PROVISIONS
Current law
Pay Freeze: The Continuing Resolution of December of 2010
included a two-year freeze on all across-the-board, annual pay
adjustments for federal civilian employees, January 1, 2011
through December 31, 2012.
Federal Employee Pensions: Most federal civilian
employees are participants in the Federal Employees Retirement
System (FERS), under which they make a contribution toward a
defined benefit pension equal to 0.8 percent of basic pay.
Their employing agency covers the remainder of the pension
cost. At normal retirement age, an employee is entitled to a
pension equal to 1 percent (or 1.1 percent for those retiring
at age 62 with 20 years of service) of the average of the
employee's highest three years' compensation times the
employee's years of service. Certain FERS participants retiring
prior to age 62 are entitled to the FERS annuity supplement.
This benefit is paid in addition to their defined benefit
annuity, and equals the Social Security benefit they would
receive for their FERS civilian service from the Social
Security Administration if eligible to receive Social Security
on their date of retirement. Most employees who first entered
federal government service before 1987 are covered by the Civil
Service Retirement System (CSRS), under which they contribute 7
percent of their pay toward their defined benefit pension. CSRS
employees are not covered by Social Security, so, unlike FERS
employees, they are not subject to the 6.2 percent Social
Security contribution. Under both FERS and CSRS, employee
contributions and benefits for special occupational groups and
Members of Congress are higher. Separate but comparable
retirement systems exist for Foreign Service and CIA employees.
House bill
Pay Freeze: The House bill would extend the current
freeze on across-the-board statutory pay adjustments for
federal civilian employees and Members of Congress through
December 31, 2013.
Federal Employee Pensions: The House bill would increase
the employee contribution for both CSRS and FERS employees by
0.5 percentage points each year for three years, beginning in
2013. Corresponding changes would be made to the Foreign
Service, CIA, and TVA retirement systems. The House bill would
establish new retirement rules for federal employees hired
after December 31, 2012, with less than 5 years of service.
Their contribution to FERS would increase by 3.2 percentage
points. The FERS pension formula salary base for new employees
would change to the highest-five years' average salary instead
of highest three years. The FERS pension formula multiplier for
most new employees would be reduced to 0.7 percent per year of
service, instead of 1 percent (or 1.1 percent for those
retiring at age 62 with 20 or more years of service). Employees
in special occupational groups are subject to a proportional
adjustment to the multiplier (0.3 percentage points lower than
current law). Finally, the House bill would eliminate the FERS
Annuity Supplement for individuals not subject to mandatory
retirement, beginning January 1, 2013. Individuals subject to
mandatory retirement include certain categories of employees
such as law enforcement, fire fighters, air traffic
controllers, and nuclear materials couriers.
Senate bill
No provision.
Conference substitute
Pay Freeze: No provision.
Federal Employee Pension: The Conference Agreement would
increase by 2.3 percent the employee pension contribution for
federal employees entering service after December 31, 2012, who
have less than 5 years of creditable civilian service.
Corresponding increases in employee contributions would be made
for individuals entering the CIA and Foreign Service pension
systems. Members of Congress and congressional employees
entering service after December 31, 2012 who have less than 5
years of creditable civilian service would be subject to the
same contribution rate and annuity calculation as other federal
employees.
MEDICARE AND OTHER HEALTH PROVISIONS
Extension of MMA Section 508 Reclassifications
Current law
Under Medicare's Inpatient Prospective Payment System
(PPS), payments are adjusted by a wage index that is intended
to reflect the cost of labor in the area where the services are
furnished compared to a national average. Hospitals in areas
with higher wage costs have higher wage indices and therefore
receive higher PPS payments; hospitals in lower wage areas have
lower wage indices and receive lower payments.
Recognizing that the indices are not always accurate,
Congress in 1989 established a process whereby hospitals could
apply to ``reclassify'' to a nearby area, and receive the
higher wage index of that area. While a significant number of
hospitals (nearly 40%) have a reclassified wage index, other
hospitals have not been able to meet the established criteria.
Section 508 of the Medicare Modernization Act of 2003
(MMA) directed the Centers for Medicare and Medicaid Services
(CMS) to develop new criteria that would allow additional
hospitals to qualify for a one-time, three-year
reclassification.
According to CMS, there were 89 hospitals receiving
Section 508 reclassification payments in FY 2011.
House bill
No provision.
Senate bill
Section 302 extended the Section 508 reclassification
payments for two months (October and November 2011).
Conference substitute
Section 3001 extends Section 508 reclassification
payments through March 31, 2012.
Extension of Outpatient Hold Harmless Payments
Current law
In 2000, Medicare implemented a PPS for hospital
outpatient services; prior to this time hospitals received
cost-based payments. For certain hospitals, primarily those
located in rural areas, the outpatient PPS payments were lower
than the payments they had received under the prior cost-based
system. The Balanced Budget Refinement Act of 1999 (BBRA)
mandated that rural hospitals with fewer than 100 beds receive
100% of the difference between OPPS payments and what these
hospitals would have received under the cost-based system (thus
the name ``hold harmless'' payments). Over time, Congress has
lowered the payment percentage (it currently is 85%) and has
expanded the policy to sole community hospitals (SCHs),
hospitals that are further than 35 miles from another hospital.
House bill
No provision.
Senate bill
Section 308 extended the hold harmless payment to all
eligible hospitals for two months (January and February 2012).
Conference substitute
Section 3002 extends the outpatient hold harmless
payments through December 31, 2012, except for SCHs with more
than 100 beds. The provision requires a study by the Department
of Health and Human Services (HHS) by July 1, 2012, on which
types of hospitals should continue to receive hold harmless
payments in order to maintain adequate beneficiary access to
outpatient services.
Physician Payment Update
Current law
The Sustainable Growth Rate (SGR) formula system was
established by the Balanced Budget Act of 1997 (BBA) as the
mechanism to determine the update to Medicare physician
payments beginning in 1999. The formula allows spending to grow
at the rate of the economy, adjusted for other factors such as
the number of beneficiaries in Medicare fee-for-service. The
tally of actual and target expenditures is cumulative in that
it is maintained on an on-going basis since the formula's
inception. The update adjustment that results from the SGR
system is made through the conversion factor. If spending
exceeds the target, the adjustment to the conversion factor is
negative (physicians payments get reduced). If spending is
below the target, the adjustment is positive (physician
payments are increased). Physician spending has routinely
exceeded the target such that the SGR formula has specified
negative updates since 2002. Congress has intervened 13 times
to avert the cuts since 2003. The SGR currently calls for a
27.4 percent across-the-board rate cut for physicians to take
effect on March 1, 2012.
House bill
Section 2201 replaced the 27.4 percent cut with a 1
percent rate increase in 2012 and another 1 percent increase in
2013. This section also required reports from the: Medicare
Payment Advisory Commission (MedPAC) on aligning private sector
initiatives to reward quality, efficiency, and practice
improvements with Medicare performance-based initiatives;
Government Accountability Office (GAO) on examining private
sector initiatives that base or adjust physician payments for
quality, efficiency, or care delivery improvement; and
Secretary of HHS on options for bundling payments for common
physician services. It also required the committees of
jurisdiction to provide information to Congress to assist in
the development of a long-term replacement to the current
Medicare physician payment system.
Senate bill
Section 301 froze physician payment rates at their 2011
level for two months (January and February 2012).
Conference substitute
Section 3003 freezes physician payment rates at their
current levels until December 31, 2012, averting a 27.4 percent
reduction. The provision also requires reports from the
Secretary of HHS, due January 1, 2013, that examines bundled or
episode-based payments to cover physicians' services for one or
more prevalent chronic conditions or major procedures. It also
requires a GAO report, due January 1, 2013, that examines
private sector initiatives that base or adjust physician
payment rates for quality, efficiency, and care delivery
improvement, such as adherence to evidence-based guidelines.
Work Geographic Adjustment
Current law
Medicare payment for each physician service is made up of
three components: 1) physician work (the time, skill and
intensity for a physician to provide a service), 2) practice
expense (associated overhead costs), and 3) physician liability
insurance. Each of these components is adjusted based on the
relative costs associated with the geographic area in which the
physician practices. Medicare makes these adjustments, known as
Geographic Practice Cost Indices (GPCIs), in each of its
designated 89 geographic areas. The national average work
adjustment is set at a value of 1.0. Thus, geographic areas
with an adjustment value greater than 1.0 receive higher work
payments than the areas with an adjustment below that
threshold. Current law maintains a work adjustment floor--set
at the national average value of 1.0--that increases work
payments to physicians in the areas that have a value below the
national average. This floor increases payments in 54 of 89
geographic areas. The MMA established this policy starting in
2004 and Congress subsequently extended it five times.
House bill
Section 2204 extended the work GPCI floor through
December 31, 2012 and required that MedPAC submit a report by
June 1, 2012 that assesses whether any work geographic
adjustment is needed, if so, at what level it should be
applied, and the impact of the floor on beneficiary access to
care.
Senate bill
Section 303 extended the 1.0 GPCI floor for two months
(January and February 2012).
Conference substitute
Section 3004 extends the 1.0 work GPCI floor through
December 31, 2012. It also requires MedPAC to report by June
15, 2013, assessing whether any work geographic adjustment is
needed and, if so, at what level it should be applied, and the
impact of the floor on beneficiary access to care.
Payment for Outpatient Therapy Services
Current law
The BBA imposed two annual per beneficiary payment limits
for all outpatient therapy services delivered by non-hospital
providers. For 2012, the annual limit on the allowed amount for
outpatient physical therapy (PT) and speech-language pathology
(SLP) combined is $1,880. There is a separate $1,880 limit for
occupational therapy (OT). Enforcement of the caps has been
blocked by legislation every year since 2000, with the
exception of three months in 2003. The Deficit Reduction Act of
2006 (DRA) required the HHS Secretary to implement an
exceptions process in 2006 for cases in which the provision of
additional therapy services above the cap was determined to be
medically necessary. Congress has extended this exceptions
process several times.
House bill
Section 2203 extended the exceptions process through
December 31, 2013, and made specific refinements to the
exceptions process to ensure that medical necessity is
documented and appropriately reviewed. Specifically, the HHS
Secretary was required to ensure, through claims processing
edits, that appropriate modifiers are on the claims indicating
that the responsible providers have documented medical
necessity for services paid above the therapy cap threshold. In
addition, all Medicare claims for therapy services were
required to include the national provider identifier (NPI) for
the physician or practitioner (not the therapist rendering
services) who periodically reviews the therapy plan of care.
The spending cap was permanently expanded to include spending
for therapy services provided in hospital outpatient
departments. Starting on July 1, 2012, when a beneficiary's
annual spending for therapy services furnished in calendar year
2012 reaches $3,700 in PT and SLP, or $3,700 in OT, any
additional services would be subject to a manual medical review
process.
By January 1, 2013, the Secretary was required to collect
detailed data on therapy patient conditions and outcomes that
could assist in reforming the current therapy payment system.
In addition, MedPAC was required to submit a report to the
committees of jurisdiction, making recommendations on how to
reform the payment system so that the benefit is better
designed to reflect individual acuity, condition, and therapy
needs of the patient. GAO was required to submit a study to the
committees of jurisdiction, examining CMS implementation of the
manual review process.
Senate bill
Section 304 extended the exceptions process for Medicare
outpatient therapy caps for two months (January and February
2012).
Conference substitute
Section 3005 extends the therapy caps exceptions process
through December 31, 2012. Starting with services provided on
or after October 1, 2012, the Secretary is required to ensure
that appropriate modifiers and NPIs are on the Medicare claims
and implement a manual medical review process for beneficiaries
whose annual spending for therapy services furnished in
calendar year 2012 reaches $3,700 in PT and SLP, or $3,700 in
OT. The spending caps are temporarily expanded (through
December 31, 2012) to include spending for therapy services
provided in hospital outpatient departments. The conference
agreement also requires the Secretary to collect detailed data
to assist in refining the therapy payment system and also
requires reports from GAO and MedPAC.
Payment for Technical Component of Certain Physician Pathology Services
Current law
Medicare pays for the preparation of pathology lab
samples (the ``technical component'') as well as the physician
interpretation and diagnosis associated with those samples
(``professional component''). Prior to 1999, independent labs
that performed the technical component (TC) of pathology lab
services for hospitals could bill Medicare directly for the TC
payment. In 1999, CMS implemented a new rule that prohibited
independent laboratories from billing for these services, with
the rationale that Medicare payment was already included in the
bundled payment to the hospital. Hospitals that had in-house
labs were unaffected. Hospitals that had been utilizing
independent labs as of July 22, 1999, however, were
``grandfathered'' in the Benefits Improvement and Protection
Act (BIPA) of 2000, allowing them to continue billing Medicare
directly.
House bill
No provision.
Senate bill
Section 305 extended the TC grandfather policy for two
months (January and February 2012).
Conference substitute
Section 3006 extends the TC grandfather policy until June
30, 2012.
Ambulance Add-On Payments
Current law
In 2002, a fee schedule was established for ground and
air ambulance services; it was fully implemented in 2006.
Currently, all ground ambulance services receive some type of
add-on: 2 percent for urban ground ambulance trips, 3 percent
for rural ground ambulance trips, and 22.6 percent for ground
ambulance trips that originate in ``super rural'' areas (those
in the lowest quartile in terms of population density).
Under the air ambulance fee schedule, rural providers
receive a 50% add-on. In 2006, the Office of Management and
Budget (OMB) changed the designation of a number of areas from
rural to urban, based on updated Census data, which would have
ended the rural add-on for air ambulances originating in the
affected areas. The Medicare Improvements for Patients and
Providers Act of 2008 (MIPPA) allowed these affected areas to
continue to be considered rural so that air ambulances could
continue to receive the rural add-on.
House bill
Section 2202 extended the payment add-ons for ground
ambulance services until December 31, 2012.
Additionally, the House bill required GAO to update their
2007 report detailing current ambulance costs. The House bill
also required MedPAC to submit a report on the appropriateness
of the ambulance fee schedule and whether there is a need to
reform the ambulance fee schedule.
Senate bill
Section 306 extended the add-ons for ground ambulance
services and continued the rural designation for certain air
ambulance services for two months (January and February 2012).
Conference substitute
Section 3007 extends payment add-ons for ground ambulance
services and continued the rural designation for certain air
ambulance services until December 31, 2012. This provision
requires GAO to update its 2007 report by October 1, 2012, to
reflect current costs for ambulance providers and requires
MedPAC to submit a report by June 15, 2013, on the
appropriateness of the ambulance add-on payments and whether
there is a need to reform the ambulance fee schedule.
Qualifying Individual Program
Current law
The Qualifying Individual (QI) program is a Medicare
savings program for certain low-income Medicare beneficiaries,
who are fully eligible for Medicare and receive Medicaid
assistance with their Medicare Part B premiums. Unlike full
benefit dually-eligible beneficiaries who are fully eligible
for both Medicare and Medicaid (known as qualified Medicare
beneficiaries (QMBs), or those with incomes below 100 percent
of poverty) and specified low-income Medicare beneficiaries
(SLMBs, or those with incomes between 100 and 120 percent of
poverty), QI is a block grant to states that must be
reauthorized each year. Enrollment in QI is limited by federal
appropriations, and applications are approved on a first-come,
first-served basis. QI beneficiaries must have incomes between
120 and 135 percent of poverty ($13,404 to $15,079 for an
individual in 2012).
House bill
Section 2211 extended the QI program through December 31,
2012.
Senate bill
Section 310 extended the QI program for two months
(January and February 2012).
Conference substitute
Section 3101 extended the QI program through December 31,
2012.
Transitional Medical Assistance
Current law
Congress expanded the Transitional Medical Assistance
(TMA) program in 1988 as part of welfare-to-work programs,
requiring states to provide TMA to families who lose Medicaid
eligibility for work-related reasons for at least six, and up
to twelve, months. During the first six months of TMA, states
must provide the same benefits the family was receiving or pay
for costs of similar employer-based coverage. The second six
months of TMA is available for families who continue to have a
dependent child at home, meet reporting requirements, and have
average gross monthly earnings below 185% of poverty.
Congress created an additional work-related TMA option in
the American Recovery and Reinvestment Act of 2009 (ARRA).
Under the ARRA option, states may choose to provide work-
related TMA for a full twelve-month period rather than two six-
month periods. These changes were informed by GAO work that
found the reporting requirements to be a substantial paperwork
barrier that caused significant numbers of eligible families to
lose coverage to which they were entitled. Thirteen states have
taken up the ARRA option: Alaska, Colorado, Connecticut,
Florida, Idaho, Maryland, Montana, New Mexico, New York, Ohio,
Oregon, South Dakota, and Wisconsin.
House bill
Section 2212 extended TMA, through December 31, 2012. In
addition, this provision contained new income reporting
requirements for any month of TMA coverage and limited TMA to
only those individuals with incomes below 185 percent of
poverty.
Senate bill
Section 311 extended TMA for two months (January and
February 2012).
Conference substitute
Section 3102 provides for an extension of TMA through
December 31, 2012.
Modification to Requirements for Qualifying for Exception to Medicare
Prohibition on Certain Physician Referrals for Hospitals
Current law
Physicians are generally prohibited from referring
Medicare patients to a health care facility in which they, or
an immediate family member, have a financial stake. However,
physician-owned hospitals have operated under an exception to
anti-trust laws, known as the ``whole hospital exception.''
The Affordable Care Act (ACA) amended the ``whole
hospital exception'' by requiring that all hospitals with
physician-ownership have a Medicare provider number by December
31, 2010. Any hospital without a Medicare provider number is
not permitted to bill Medicare for services provided to
beneficiaries under the ``whole hospital exception.''
Grandfathered physician-owned hospitals, those with Medicare
provider numbers by December 31, 2010, may continue to operate.
However, they may not alter the proportion of physician-
ownership in the hospital. Under current law, a grandfathered
hospital may apply to expand the number of operating rooms,
procedure rooms and/or beds if it meets five criteria.
House bill
Section 2213 allowed physician-owned hospitals that were
under construction but without a Medicare provider number on
December 31, 2010, to open and operate under the ``whole
hospital exception.'' The provision would also allow a
grandfathered hospital the ability to utilize the existing
expansion process if it certifies that it does not discriminate
against beneficiaries in federal health care programs.
Senate bill
No provision.
Conference substitute
No provision.
Extending Minimum Payment for Bone Mass Measurement
Current law
Dual energy X-ray absorptiometry (DXA) machines are used
to measure bone mass to identify individuals who may have or be
at risk of having osteoporosis. For those individuals who are
eligible, Medicare will pay for a bone density study once every
two years, or more frequently if the procedure is determined to
be medically necessary. The DRA capped reimbursement of the
technical component for x-ray and imaging services as the
lesser rate of the hospital outpatient rate or the physician
fee schedule. Additionally, CMS implemented a new methodology
for determining resource-based practice expense payments for
all services contributed to the reduction in the technical
component reimbursement. The ACA set DXA payments at 70 percent
of the 2006 reimbursement rates for these services in 2010 and
2011.
House bill
No provision.
Senate bill
Section 309 extended the 70 percent of the 2006 payment
rate for two months (January and February 2012).
Conference substitute
No provision.
Extension of Physician Fee Schedule Mental Health Add-on Payment
Current law
Medicare pays for mental health services under the
physician fee schedule. MIPPA increased the fee schedule amount
for certain mental health service by 5 percent beginning on
July 1, 2008. Subsequent legislation extended this add-on.
House bill
No provision.
Senate bill
Section 307 extended the 5 percent payment add-on for two
months (January and February 2012).
Conference substitute
No provision.
Reduction of Bad Debt Treated as an Allowable Cost
Current law
Medicare reimburses providers for beneficiaries' unpaid
coinsurance and deductible amounts after reasonable collection
efforts. Medicare currently reimburses 70 percent of
beneficiary bad debts in acute care hospitals. Medicare
reimburses skilled nursing facilities 100 percent of the
allowable bad debt costs for Medicare beneficiaries who are
eligible for Medicaid (dual eligibles) and 70 percent of the
allowable costs for all other beneficiaries. Medicare
reimburses 100 percent of allowable bad debt in critical access
hospitals, rural health clinics, federally qualified health
clinics, community mental health clinics, health maintenance
organizations reimbursed on a cost basis, competitive medical
plans, and health care prepayment plans. Medicare also
reimburses end stage renal disease facilities 100 percent of
allowable bad debt claims, with such payments capped at the
facilities' unrecovered costs.
House bill
Section 2224 gradually reduced the bad debt
reimbursement, beginning in 2013 and over a period of three
years, for all providers to 55 percent.
Senate bill
No provision.
Conference substitute
Section 3201 will reduce bad debt reimbursement for all
providers to 65 percent. Providers paid at 100 percent would
have a three-year transition of 88 percent in 2013, 76 percent
in 2014, and 65 percent in 2015. Providers paid at 70 percent
would be reduced to 65 percent in 2013.
Rebase Medicare Clinical Laboratory Payment Rates
Current law
Medicare pays for clinical laboratory services under
carrier-specific fee schedules subject to national payment
limits. Most lab services receive payment at the national limit
amount.
House bill
No provision.
Senate bill
No provision.
Conference substitute
Section 3202 resets clinical lab base payment rates by 2
percent in 2013.
Rebasing State DSH Allotments for Fiscal Year 2021
Current law
Medicaid Disproportionate Share Hospital (DSH) payments
provide additional funding to hospitals that serve a
disproportionate number of low-income patients. States receive
an annual DSH allotment to cover the costs of DSH hospitals
that provide care to low-income, uninsured patients. This
annual allotment is calculated by law and includes requirements
to ensure that the DSH payments to individual hospitals are not
higher than actual uncompensated care costs. Each state's
federal allotment is capped based on either the prior year's
allotment plus inflation or twelve percent of the state's total
Medicaid benefits payments for the year. Once a state receives
its federal allotment, the state has discretion to distribute
the funding to hospitals, as long as the state's methodology is
based on the Medicaid inpatient utilization rate (exceeding one
standard deviation above the mean for all hospitals in the
state) or a low-income utilization rate exceeding 25 percent.
The ACA reduced DSH payments between 2014 and 2020, based
on a formula that the Secretary of HHS will develop through
future regulation.
House bill
Section 2225 would rebase the DSH allotments for FY2021
and determine future allotments from the rebased level using
current law methodology.
Senate bill
No provision.
Conference substitute
Section 3203 extends the ACA Medicaid DSH payment
reductions in 2021.
Technical Correction to the Disaster Recovery FMAP Provision
Current law
The ACA included a provision known as the `disaster-
recovery FMAP' designed to help states adjust to drastic
changes in FMAP following a statewide disaster. Once triggered,
the policy would provide assistance for as many as seven years
following the disaster, as long as the state continued to
experience an FMAP drop of more than three percentage points.
During the first year, a state would receive an FMAP
increase equal to 50 percent of the difference between the
regular FMAP and the artificially lower FMAP. In the second and
succeeding years, the FMAP increase would be 25 percent of the
difference between the regular FMAP and the adjusted FMAP from
the previous year. However, there is an error in the statute
for the second and succeeding years. Instead of creating a
glide path downward, so that the affected state could adjust to
its new, lower FMAP, the 25 percent bump is added to the
higher, adjusted FMAP of the previous year rather than the
lower, base FMAP. This results in increasing FMAPs for each
year of the disaster-recovery period, compounding over time. It
also makes it easier for the state to continue to qualify each
year because it is easier for there to be a three percentage
point difference between the artificially high FMAP and the
base FMAP.
House bill
No provision.
Senate bill
No provision.
Conference substitute
Section 3204 would address the error by instituting a
lower FMAP in the second and subsequent years.
Prevention and Public Health Fund
Current law
The ACA established a Prevention and Public Health Trust
Fund to help shift the focus of the health care system to
prevention rather than treatment. The fund provides increasing
mandatory direct spending from $500 million in 2010 to $2
billion in 2015 and each year thereafter.
House bill
Section 2222 reduced trust fund dollars beginning in
FY2013, saving $8 billion.
Senate bill
No provision.
Conference substitute
Section 3205 reduces trust fund dollars beginning in
FY2013, saving $5 billion.
Parity in Medicare Payments for Hospital Outpatient Department
Evaluation and Management Services
Current law
When a physician treats a beneficiary in a hospital
outpatient department, the physician's services are reimbursed
under Medicare's physician fee schedule and the hospital
receives a facility payment from Medicare under the outpatient
prospective payment system (OPPS). Because of the facility
payment, the total payment generally exceeds payments for the
same services provided in a physician office.
House bill
Section 2223 would reduce hospital facility fee payments
for evaluation and management services provided in a hospital
outpatient department so that payment for the service in
aggregate would not exceed the amount under the Medicare
physician fee schedule beginning in 2012. These lower payments
would not be considered in the review of different components
of Medicare's OPPS to ensure that annual adjustments are budget
neutral.
Senate bill
No provision.
Conference substitute
No provision.
Increase in Medicare Part B and Part D Premiums for High-Income
Beneficiaries
Current law
The MMA of 2003 established that high-income
beneficiaries enrolled in Part B would pay a higher premium.
The ACA expanded this provision to the Part D program.
Currently, high-income beneficiaries are required to pay a
greater share of the Medicare Part B and Part D premiums (35
percent, 50 percent, 65 percent, or 80 percent) depending on
their income. For 2012, the income thresholds for those premium
shares are $85,000, $107,000, $160,000, and $214,000,
respectively for single filers. For married couples, the
corresponding income thresholds are twice those values. Because
of a provision in the ACA, the income thresholds for both
Medicare Part B and Part D are frozen through 2019.
House bill
Sections 5601 and 5602 would increase the applicable
premium percentage higher income beneficiaries would pay by 15
percent such that the levels would become 40.25 percent, 57.5
percent, 74.75 percent, and 90 percent in 2017. This provision
would also reduce the income thresholds in 2017, to $80,000,
$100,000, $150,000 and $200,000 for single filers (and twice
those values for married couples) and extend the freeze of the
income thresholds beyond 2019, until 25 percent of all
beneficiaries are paying higher income premiums.
Senate bill
No provision.
Conference substitute
No provision.
TAX PROVISIONS
A. Extension of Payroll Tax Reduction (sec. 2001 of the House bill,
sec. 101 of the Senate amendment, and sec. 1001 of the conference
agreement)
PRESENT LAW
Federal Insurance Contributions Act (``FICA'') tax
The FICA tax applies to employers based on the amount of
covered wages paid to an employee during the year.\1\
Generally, covered wages means all remuneration for employment,
including the cash value of all remuneration paid in any medium
other than cash.\2\ Certain exceptions from covered wages are
also provided. The tax imposed is composed of two parts: (1)
the old age, survivors, and disability insurance (``OASDI'')
tax equal to 6.2 percent of covered wages up to the taxable
wage base ($106,800 for 2011 and $110,100 for 2012); and (2)
the Medicare hospital insurance (``HI'') tax amount equal to
1.45 percent of covered wages.
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\1\Sec. 3111.
\2\Sec. 3121(a).
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In addition to the tax on employers, each employee is
generally subject to FICA taxes equal to the amount of tax
imposed on the employer (the ``employee portion'').\3\ The
employee portion of FICA taxes generally must be withheld and
remitted to the Federal government by the employer.
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\3\Sec. 3101. For taxable years beginning after 2012, an additional
HI tax applies to certain employees.
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Self-Employment Contributions Act (``SECA'') Tax
As a parallel to FICA taxes, the SECA tax applies to the
self-employment income of self-employed individuals.\4\ The
rate of the OASDI portion of SECA taxes is generally 12.4
percent, which is equal to the combined employee and employer
OASDI FICA tax rates, and applies to self-employment income up
to the FICA taxable wage base. Similarly, the rate of the HI
portion of SECA tax is 2.9 percent, the same as the combined
employer and employee HI rates under the FICA tax, and there is
no cap on the amount of self-employment income to which the
rate applies.\5\
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\4\Sec. 1401.
\5\For taxable years beginning after 2012, an additional HI tax
applies to certain self-employed individuals.
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An individual may deduct, in determining net earnings
from self-employment under the SECA tax, the amount of the net
earnings from self-employment (determined without regard to
this deduction) for the taxable year multiplied by one half of
the combined OASDI and HI rates.\6\
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\6\Sec. 1402(a)(12).
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Additionally, a deduction, for purposes of computing the
income tax of an individual, is allowed for one-half of the
amount of the SECA tax imposed on the individual's self-
employment income for the taxable year.\7\
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\7\Sec. 164(f).
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Railroad retirement tax
Instead of FICA taxes, railroad employers and employees
are subject, under the Railroad Retirement Tax Act (``RRTA''),
to taxes equivalent to the OASDI and HI taxes under FICA.\8\
The employee portion of RRTA taxes generally must be withheld
and remitted to the Federal government by the employer.
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\8\Secs. 3201(a) and 3211(a).
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Temporary reduced OASDI rates
Under the Tax Relief, Unemployment Insurance
Reauthorization, and Job Creation Act of 2010,\9\ for 2011, the
OASDI rate for the employee portion of the FICA tax, and the
equivalent employee portion of the RRTA tax, is reduced by two
percentage points to 4.2 percent. Similarly, for taxable years
beginning in 2011, the OASDI rate for a self-employed
individual is reduced by two percentage points to 10.4 percent.
---------------------------------------------------------------------------
\9\Pub. L. No. 111-312.
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Special rules coordinate the SECA tax rate reduction with
a self-employed individual's deduction in determining net
earnings from self-employment under the SECA tax and the income
tax deduction for one-half of the SECA tax. The rate reduction
is not taken into account in determining the SECA tax deduction
allowed for determining the amount of the net earnings from
self-employment for the taxable year. The income tax deduction
allowed for the SECA tax for taxable years beginning in 2011 is
59.6 percent of the OASDI portion of the SECA tax imposed for
the taxable year plus one-half of the HI portion of the SECA
tax imposed for the taxable year.\10\
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\10\This percentage replaces the rate of one half (50 percent)
otherwise allowed for this portion of the deduction. The percentage is
necessary to allow the self-employed individual to deduct the full
amount of the employer portion of SECA taxes. The employer OASDI tax
rate remains at 6.2 percent, while the employee portion falls to 4.2
percent. Thus, the employer share of total OASDI taxes is 6.2 divided
by 10.4, or 59.6 percent of the OASDI portion of SECA taxes.
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The Federal Old-Age and Survivors Trust Fund, the Federal
Disability Insurance Trust Fund and the Social Security
Equivalent Benefit Account established under the Railroad
Retirement Act of 1974\11\ receive transfers from the General
Fund of the United States Treasury equal to any reduction in
payroll taxes attributable to the rate reduction for 2011. The
amounts are transferred from the General Fund at such times and
in such a manner as to replicate to the extent possible the
transfers which would have occurred to the Trust Funds or
Benefit Account had the provision not been enacted.
---------------------------------------------------------------------------
\11\45 U.S.C. 231n-1(a).
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For purposes of applying any provision of Federal law
other than the provisions of the Internal Revenue Code of 1986,
the employee rate of OASDI tax is determined without regard to
the reduced rate for 2011.
Under the Temporary Payroll Tax Cut Continuation Act of
2011,\12\ the reduced employee OASDI tax rate of 4.2 percent
under the FICA tax, and the equivalent employee portion of the
RRTA tax, is extended to apply to covered wages paid in the
first two months of 2012. A recapture applies for any benefit a
taxpayer may have received from the reduction in the OASDI tax
rate, and the equivalent employee portion of the RRTA tax, for
remuneration received during the first two months of 2012 in
excess of $18,350.\13\ The recapture is accomplished by a tax
equal to two percent of the amount of wages (and railroad
compensation) received during the first two months of 2012 that
exceed $18,350. The Secretary of the Treasury (or the
Secretary's delegate) is to prescribe regulations or other
guidance that is necessary and appropriate to carry out this
provision.
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\12\Pub. L. No. 112-78, enacted after passage of H.R. 3630 by the
House of Representatives and the Senate.
\13\$18,350 is \1/6\ of the 2012 taxable wage base of $110,100.
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In addition, for taxable years beginning in 2012, the
OASDI rate for a self-employed individual is reduced to 10.4
percent, for self-employment income of up to $18,350 (reduced
by wages subject to the lower OASDI rate for 2012). Related
rules for 2011 concerning coordination of a self-employed
individual's deductions in determining net earnings from self-
employment and income tax also apply for 2012, except that the
income tax deduction allowed for the OASDI portion of SECA tax
imposed for taxable years beginning in 2012 is computed at the
rate of 59.6 percent\14\ of the OASDI portion of the SECA tax
imposed on self-employment income of up to $18,350. For self-
employment income in excess of this amount, the deduction is
equal to half of the OASDI portion of the SECA tax.
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\14\This percentage used with respect to the first $18,350 of self-
employment income is necessary to continue to allow the self-employed
taxpayer to deduct the full amount of the employer portion of SECA
taxes. The employer OASDI tax rate remains at 6.2 percent, while the
employee portion falls to a 4.2 percent rate for the first $18,350 of
self-employment income. Thus, the employer share of total OASDI taxes
is 6.2 divided by 10.4, or 59.6 percent of the OASDI portion of SECA
taxes, for the first $18,350 of self-employment income.
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Rules related to the OASDI rate reduction for 2011
concerning (1) transfers to the Federal Old-Age and Survivors
Trust Fund, the Federal Disability Insurance Trust Fund and the
Social Security Equivalent Benefit Account established under
the Railroad Retirement Act of 1974, and (2) determining the
employee rate of OASDI tax in applying provisions of Federal
law other than the Code also apply for 2012.
HOUSE BILL\15\
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\15\The House bill passed prior to the enactment of the ``Temporary
Payroll Tax Cut Continuation Act of 2011'', Pub. L. No. 112-78,
described above.
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Under the House bill, the reduced employee OASDI tax rate
of 4.2 percent under the FICA tax, and the equivalent portion
of the RRTA tax, is extended to apply for 2012. Similarly, a
reduced OASDI tax rate of 10.4 percent under the SECA tax, is
extended to apply for taxable years beginning in 2012.
Related rules concerning (1) coordination of a self-
employed individual's deductions in determining net earnings
from self-employment and income tax, (2) transfers to the
Federal Old-Age and Survivors Trust Fund, the Federal
Disability Insurance Trust Fund and the Social Security
Equivalent Benefit Account established under the Railroad
Retirement Act of 1974, and (3) determining the employee rate
of OASDI tax in applying provisions of Federal law other than
the Code also apply for 2012.
Effective date.--The provision applies to remuneration
received, and taxable years beginning, after December 31, 2011.
SENATE AMENDMENT\16\
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\16\The Senate amendment passed prior to the enactment of the
``Temporary Payroll Tax Cut Continuation Act of 2011'', Pub. L. No.
112-78, described above.
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Under the Senate amendment, the reduced employee OASDI
tax rate of 4.2 percent under the FICA tax, and the equivalent
employee portion of the RRTA tax, applies to covered wages paid
up to $18,350 in the first two months of 2012.\17\
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\17\$18,350 is \1/6\ of the 2012 taxable wage base of $110,100.
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In addition, for taxable years beginning in 2012, the
Senate amendment provides that the OASDI rate for a self-
employed individual is reduced to 10.4 percent, for self-
employment income of up to $18,350 (reduced by wages subject to
the lower OASDI rate for 2012). Related rules for 2011
concerning coordination of a self-employed individual's
deductions in determining net earnings from self-employment and
income tax also apply for 2012, except that the income tax
deduction allowed for the OASDI portion of SECA tax imposed for
taxable years beginning in 2012 is computed at the rate of 59.6
percent\18\ of the OASDI portion of the SECA tax imposed on
self-employment income of up to $18,350. For self-employment
income in excess of this amount, the deduction is equal to half
of the OASDI portion of the SECA tax.
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\18\See footnote 14.
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The Senate amendment also contains rules related to the
OASDI rate reduction for 2011 concerning (1) transfers to the
Federal Old-Age and Survivors Trust Fund, the Federal
Disability Insurance Trust Fund and the Social Security
Equivalent Benefit Account established under the Railroad
Retirement Act of 1974, and (2) determining the employee rate
of OASDI tax in applying provisions of Federal law other than
the Code also apply for 2012.
Effective date.--The provision applies to remuneration
received, and taxable years beginning, after December 31, 2011.
CONFERENCE AGREEMENT
The conference agreement follows the House bill,
providing for a reduced employee OASDI tax rate of 4.2 percent
under the FICA tax, and the equivalent potion of the RRTA tax,
through 2012. Similarly, a reduced OASDI tax rate of 10.4
percent under the SECA tax applies for taxable years beginning
in 2012.
As in the House bill and Senate amendment, related rules
concerning (1) coordination of a self-employed individual's
deductions in determining net earnings from self-employment and
income tax, (2) transfers to the Federal Old-Age and Survivors
Trust Fund, the Federal Disability Insurance Trust Fund and the
Social Security Equivalent Benefit Account established under
the Railroad Retirement Act of 1974, and (3) determining the
employee rate of OASDI tax in applying provisions of Federal
law other than the Code also apply for 2012.
The conference agreement repeals the present-law
recapture provision applicable to a taxpayer who receives the
reduced OASDI rate with respect to more than $18,350 of wages
(or railroad compensation) received during the first two months
of 2012, and removes the $18,350 limitation on self-employment
income subject to the lower rate for taxable years beginning in
2012.
Effective date.--The provision applies to remuneration
received, and taxable years beginning, after December 31, 2011.
B. Repeal of Certain Shifts in the Timing of Corporate Estimated Tax
Payments (sec. 6001 of the House bill and sec. 7001 of the conference
agreement)
PRESENT LAW
In general, corporations are required to make quarterly
estimated tax payments of their income tax liability.\19\ For a
corporate whose taxable year is a calendar year, these
estimated payments must be made by April 15, June 15, September
15, and December 15. In the case of a corporation with assets
of at least $1 billion (determined as of the end of the
preceding taxable year):
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\19\Sec. 6655.
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(i) payments due in July, August or September,
2012, are increased to 100.5 percent of the payment
otherwise due;\20\
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\20\United States-Korea Free Trade Agreement Implementation Act,
Pub. L. No. 112-41, sec 505, and United States-Panama Trade Promotion
Agreement Implementation Act of 2011, Pub. L. No. 112-43, sec 502.
---------------------------------------------------------------------------
(ii) payments due in July, August, or September,
2014, are increased to 174.25 percent of the payment
otherwise due;\21\
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\21\Haiti Economic Lift Program of 2010, Pub. L. No. 111-171, sec.
12(a); Health Care and Education Reconciliation Act of 2010, Pub. L.
No. 111-152, sec. 1410; Hiring Incentives to Restore Employment Act,
Pub. L. No. 111-147, sec. 561(1); Act to extend the Generalized System
of Preferences and the Andean Trade Preference Act, and for other
purposes, Pub. L. No. 111-124, sec. 4; Worker, Homeownership, and
Business Assistance Act of 2009, Pub. L. No. 111-92, sec. 18; Joint
resolution approving the renewal of import restrictions contained in
the Burmese Freedom and Democracy Act of 2003, and for other purposes,
Pub. L. No. 111-42, sec. 202(b)(1).
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(iii) payments due in July, August or September,
2015, are increased to 163.75 percent of the payment
otherwise due;\22\
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\22\Omnibus Trade Act of 2010, Pub. L. No. 111-344, sec. 10002;
Small Business Jobs Act of 2010, Pub. L. No. 111-240, sec. 2131;
Firearms Excise Tax Improvements Act of 2010, Pub. L. No. 111-237, sec.
4(a); United States Manufacturing Enhancement Act of 2010, Pub. L. No.
111-227, sec. 4002; Joint resolution approving the renewal of import
restrictions contained in the Burmese Freedom and Democracy Act of
2003, and for other purposes, No. 111-210, sec. 3; Haiti Economic Lift
Program of 2010, Pub. L. No. 111-171, sec. 12(b); Hiring Incentives to
Restore Employment Act, Pub. L. No. 111-147, sec. 561(2).
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(iv) payments due in July, August, or September
2016 are increased to 103.5 percent of the payment
otherwise due; and\23\
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\23\United States-Korea Free Trade Agreement Implementation Act,
Pub. L. No. 112-41, sec 505; United States-Columbia Trade Promotion
Agreement Implementation Act, Pub. L. No. 112-42, sec 603; and United
States-Panama Trade Promotion Agreement Implementation Act, Pub. L. No.
112-43, sec 502.
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(v) payments due in July, August or September,
2019, are increased to 106.50 percent of the payment
otherwise due.\24\
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\24\Hiring Incentives to Restore Employment Act, Pub. L. No. 111-
147, sec. 561(3).
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HOUSE BILL
The House bill reduces the applicable percentage for 2012
(100.5 percent), 2014 (174.25 percent), 2015 (163.75 percent),
2016 (103.5 percent), and 2019 (106.5 percent) to 100 percent.
Thus corporations will make estimated tax payments in 2012,
2014, 2015, 2016, and 2019 as if the prior legislation had
never been enacted or amended.
Effective date.--The provision is effective on the date
of enactment.
SENATE PROVISION
No provision.
CONFERENCE AGREEMENT
The conference agreement follows the House bill,
providing reductions in the applicable percentages for 2012
(100.5 percent), 2014 (174.25 percent), 2015 (163.75 percent),
2016 (103.5 percent), and 2019 (106.5 percent) to 100 percent.
Thus corporations will be required to make estimated tax
payments in 2012, 2014, 2015, 2016, and 2019 as if the prior
legislation had never been enacted or amended.
C. Extension of 100 Percent Bonus Depreciation (sec. 1201(a) of the
House bill and secs. 168(k)(5) and 460(c)(6) of the Code)
PRESENT LAW
An additional first-year depreciation deduction is
allowed equal to 50 percent of the adjusted basis of qualified
property placed in service between January 1, 2008 and
September 8, 2010 or between January 1, 2012 and January 1,
2013 (January 1, 2014 for certain longer-lived and
transportation property).\25\ An additional first-year
depreciation deduction is allowed equal to 100 percent of the
adjusted basis of qualified property if it meets the
requirements for the additional first-year depreciation and
also meets the following requirements. First, the taxpayer must
acquire the property after September 8, 2010 and before January
1, 2012. Second, the taxpayer must place the property in
service after September 8, 2010 and before January 1, 2012
(before January 1, 2013 in the case of certain longer-lived and
transportation property). Third, the original use of the
property must commence with the taxpayer after September 8,
2010.\26\
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\25\Sec. 168(k). The additional first-year depreciation deduction
is subject to the general rules regarding whether an item must be
capitalized under section 263 or section 263A.
\26\See Rev. Proc. 2011-26, 2011-16 I.R.B. 664 (Apr. 18, 2011) for
guidance regarding additional first-year depreciation.
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The additional first-year depreciation deduction is
allowed for both regular tax and alternative minimum tax
purposes, but is not allowed for purposes of computing earnings
and profits. The basis of the property and the depreciation
allowances in the year of purchase and later years are
appropriately adjusted to reflect the additional first-year
depreciation deduction. In addition, there are no adjustments
to the allowable amount of depreciation for purposes of
computing a taxpayer's alternative minimum taxable income with
respect to property to which the provision applies. The amount
of the additional first-year depreciation deduction is not
affected by a short taxable year. The taxpayer may elect out of
additional first-year depreciation for any class of property
for any taxable year.
The interaction of the additional first-year depreciation
allowance with the otherwise applicable depreciation allowance
may be illustrated as follows. Assume that in 2009, a taxpayer
purchased new depreciable property and placed it in
service.\27\ The property's cost is $1,000, and it is five-year
property subject to the half-year convention. The amount of
additional first-year depreciation allowed is $500. The
remaining $500 of the cost of the property is depreciable under
the rules applicable to five-year property. Thus, 20 percent,
or $100, is also allowed as a depreciation deduction in 2009.
The total depreciation deduction with respect to the property
for 2009 is $600. The remaining $400 adjusted basis of the
property generally is recovered through otherwise applicable
depreciation rules.
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\27\Assume that the cost of the property is not eligible for
expensing under section 179.
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Property qualifying for the additional first-year
depreciation deduction must meet all of the following
requirements. First, the property must be (1) property to which
MACRS applies with an applicable recovery period of 20 years or
less; (2) water utility property (as defined in section
168(e)(5)); (3) computer software other than computer software
covered by section 197; or (4) qualified leasehold improvement
property (as defined in section 168(k)(3)).\28\ Second, the
original use\29\ of the property must commence with the
taxpayer after December 31, 2007.\30\ Third, the taxpayer must
acquire the property within the applicable time period (as
described below). Finally, the property must be placed in
service before January 1, 2013. An extension of the placed-in-
service date of one year (i.e., January 1, 2014) is provided
for certain property with a recovery period of 10 years or
longer and certain transportation property.\31\ Transportation
property generally is defined as tangible personal property
used in the trade or business of transporting persons or
property.\32\
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\28\The additional first-year depreciation deduction is not
available for any property that is required to be depreciated under the
alternative depreciation system of MACRS. The additional first-year
depreciation deduction is also not available for qualified New York
Liberty Zone leasehold improvement property as defined in section
1400L(c)(2).
\29\The term ``original use'' means the first use to which the
property is put, whether or not such use corresponds to the use of such
property by the taxpayer. If in the normal course of its business a
taxpayer sells fractional interests in property to unrelated third
parties, then the original use of such property begins with the first
user of each fractional interest (i.e., each fractional owner is
considered the original user of its proportionate share of the
property).
\30\A special rule applies in the case of certain leased property.
In the case of any property that is originally placed in service by a
person and that is sold to the taxpayer and leased back to such person
by the taxpayer within three months after the date that the property
was placed in service, the property would be treated as originally
placed in service by the taxpayer not earlier than the date that the
property is used under the leaseback. If property is originally placed
in service by a lessor, such property is sold within three months after
the date that the property was placed in service, and the user of such
property does not change, then the property is treated as originally
placed in service by the taxpayer not earlier than the date of such
sale.
\31\Property qualifying for the extended placed-in-service date
must have an estimated production period exceeding one year and a cost
exceeding $1 million.
\32\Certain aircraft which is not transportation property, other
than for agricultural or firefighting uses, also qualifies for the
extended placed-in-service date, if at the time of the contract for
purchase, the purchaser made a nonrefundable deposit of the lesser of
10 percent of the cost or $100,000, and which has an estimated
production period exceeding four months and a cost exceeding $200,000.
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To qualify, property must be acquired (1) after December
31, 2007, and before January 1, 2013, but only if no binding
written contract for the acquisition is in effect before
January 1, 2008, or (2) pursuant to a binding written contract
which was entered into after December 31, 2007, and before
January 1, 2013.\33\ With respect to property that is
manufactured, constructed, or produced by the taxpayer for use
by the taxpayer, the taxpayer must begin the manufacture,
construction, or production of the property after December 31,
2007, and before January 1, 2013. Property that is
manufactured, constructed, or produced for the taxpayer by
another person under a contract that is entered into prior to
the manufacture, construction, or production of the property is
considered to be manufactured, constructed, or produced by the
taxpayer. For property eligible for the extended placed-in-
service date, a special rule limits the amount of costs
eligible for the additional first-year depreciation. With
respect to such property, only the portion of the basis that is
properly attributable to the costs incurred before January 1,
2013 (``progress expenditures'') is eligible for the additional
first-year depreciation deduction.\34\
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\33\Property does not fail to qualify for the additional first-year
depreciation merely because a binding written contract to acquire a
component of the property is in effect prior to January 1, 2008.
\34\For purposes of determining the amount of eligible progress
expenditures, it is intended that rules similar to section 46(d)(3) as
in effect prior to the Tax Reform Act of 1986, Pub. L. No. 99-514,
apply.
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Property does not qualify for the additional first-year
depreciation deduction when the user of such property (or a
related party) would not have been eligible for the additional
first-year depreciation deduction if the user (or a related
party) were treated as the owner. For example, if a taxpayer
sells to a related party property that was under construction
prior to January 1, 2008, the property does not qualify for the
additional first-year depreciation deduction. Similarly, if a
taxpayer sells to a related party property that was subject to
a binding written contract prior to January 1, 2008, the
property does not qualify for the additional first-year
depreciation deduction. As a further example, if a taxpayer
(the lessee) sells property in a sale-leaseback arrangement,
and the property otherwise would not have qualified for the
additional first-year depreciation deduction if it were owned
by the taxpayer-lessee, then the lessor is not entitled to the
additional first-year depreciation deduction.
The limitation under section 280F on the amount of
depreciation deductions allowed with respect to certain
passenger automobiles is increased in the first year by $8,000
for automobiles that qualify (and for which the taxpayer does
not elect out of the additional first-year deduction). The
$8,000 increase is not indexed for inflation.
Percentage-of-completion method
In general, in the case of a long-term contract, the
taxable income from the contract is determined under the
percentage-of-completion method. Solely for purposes of
determining the percentage of completion under section
460(b)(1)(A), the cost of qualified property with a MACRS
recovery period of seven years or less is taken into account as
a cost allocated to the contract as if bonus depreciation had
not been enacted for property placed in service after December
31, 2009 and before January 1, 2011 (January 1, 2012, for
certain longer-lived and transportation property). Bonus
depreciation is taken into account in determining taxable
income under the percentage-of-completion method for property
placed in service after December 31, 2010.
HOUSE BILL
The House bill increases the additional first-year
depreciation deduction from 50 percent to 100 percent of the
adjusted basis of qualified property placed in service after
December 31, 2011, and before January 1, 2013 (January 1, 2014,
for certain longer-lived and transportation property).
The provision provides that solely for purposes of
determining the percentage of completion under section
460(b)(1)(A), the cost of qualified property with a MACRS
recovery period of seven years or less which is placed in
service after December 31, 2011, and before January 1, 2013
(January 1, 2014, for certain longer-lived and transportation
property) is taken into account as a cost allocated to the
contract as if bonus depreciation had not been enacted.
Effective date.--The provision applies to property placed
in service after December 31, 2011.
SENATE AMENDMENT
No provision.
CONFERENCE AGREEMENT
The conference agreement does not include the provision
from the House bill.
D. Expansion of Election to Accelerate AMT Credits in Lieu of Bonus
Depreciation (sec. 1201(b) of the House bill and sec. 168(k)(4) of the
Code)
PRESENT LAW
A corporation may elect to claim additional alternative
minimum tax (``AMT'') credits in lieu of claiming additional
first year depreciation (``bonus depreciation'') on eligible
qualified property\35\ placed in service after December 31,
2010, and before January 1, 2013 (January 1, 2014, in the case
of certain longer-lived property and transportation
property).\36\ A corporation making the election (i) forgoes
bonus depreciation for eligible qualified property, (ii) uses
the straight-line method of depreciation for eligible qualified
property, and (iii) increases the limitation on the allowance
of AMT credit by the bonus depreciation amount.\37\ The
increase in the allowable AMT credit by reason of the election
is treated as refundable.
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\35\The term ``eligible qualified property'' means property
eligible for bonus depreciation, with minor effective date differences.
\36\Sec. 168(k)(4).
\37\Sec. 53(c) otherwise limits the allowable AMT credit for a
taxable year to the excess of the regular tax liability (reduced by
certain credits) over the tentative minimum tax for the taxable year.
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The bonus depreciation amount is 20 percent of the
difference between (i) the aggregate amount of depreciation for
all eligible qualified property placed in service by the
corporation that would be allowed if bonus depreciation applied
using the most accelerated depreciation method (determined
without regard to this provision), and shortest life allowable
for each property, and (ii) the amount of depreciation that
would be allowed if bonus depreciation did not apply using the
same method and life for each property.
The bonus depreciation amount for any taxable year is
limited to the lesser of (i) $30 million, or (ii) six percent
of the AMT credit for the year attributable to the adjusted net
minimum tax for taxable years beginning before January 1, 2006
(determined by treating credits as allowed on a first-in,
first-out basis), reduced by the sum of certain bonus
depreciation amounts for prior taxable years.
In the case of an electing corporation that is a partner
in a partnership, the corporation's distributive share of
partnership items is determined without regard to bonus
depreciation and by using the straight-line method of
depreciation. No partnership property is taken into account in
determining a corporation's bonus depreciation amount.
Generally an election under this provision for a taxable
year applies to subsequent taxable years.
All corporations treated as a single employer under
section 52(a) are treated as one taxpayer for purposes of the
provision and are treated as having made an election under this
provision if any of the corporations so elects.
HOUSE BILL
The House bill revises the provision allowing a
corporation to elect to claim additional AMT credits in lieu of
bonus depreciation.\38\ The House bill provision follows the
substance of present law with the following changes:
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\38\The House bill rewrites section 168(k)(4) in order to delete a
substantial amount of ``deadwood'' from the language of present law.
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Under the House bill, the bonus depreciation amount for
any taxable year is limited to the lesser of (i) the AMT credit
for the year attributable to the adjusted net minimum tax for
taxable years ending before January 1, 2012 (determined by
treating credits as allowed on a first-in, first-out basis), or
(ii) 50 percent of the AMT credit for the first taxable year
ending after December 31, 2011.
In the case of a partnership in which more than 50
percent of the capital and profits interests are owned
(directly or indirectly) by one corporation (or by corporations
treated as one taxpayer for purposes of this provision), the
bonus depreciation amount is computed by treating each partner
as having an amount equal to that partner's allocable share of
the eligible property for the taxable year (as determined under
regulations prescribed by the Secretary).
A corporation may make a separate election for each
taxable year.
Effective date.--The provision applies to taxable years
ending after December 31, 2011.
For a taxable year which begins before January 1, 2012,
and ends after December 31, 2011, the bonus depreciation amount
is the sum of the amounts computed separately for each portion
of the taxable year by treating each portion as a separate
taxable year taking into account property placed in service by
the corporation during that portion of the taxable year.
SENATE AMENDMENT
No provision.
CONFERENCE AGREEMENT
The conference agreement does not include the provision
from the House bill.
E. Adjustments to Maximum Thresholds for Recapturing Overpayments
Resulting From Certain Federally-subsidized Health Insurance (sec. 2221
of the House bill and sec. 36B of the Code)
PRESENT LAW
Premium assistance credit
For taxable years ending after December 31, 2013, section
36B provides a refundable tax credit (the ``premium assistance
credit'') for eligible individuals and families who purchase
health insurance through an American Health Benefit Exchange.
The premium assistance credit, which is refundable and payable
in advance directly to the insurer, subsidizes the purchase of
certain health insurance plans through an American Health
Benefit Exchange.
The premium assistance credit is available for
individuals (single or joint filers) with household incomes
between 100 and 400 percent of the Federal poverty level
(``FPL'') for the family size involved who do not receive
health insurance through an employer or a spouse's
employer.\39\ Household income is defined as the sum of: (1)
the taxpayer's modified adjusted gross income, plus (2) the
aggregate modified adjusted gross incomes of all other
individuals taken into account in determining that taxpayer's
family size (but only if such individuals are required to file
a tax return for the taxable year). Modified adjusted gross
income is defined as adjusted gross income increased by: (1)
any amount excluded by section 911 (the exclusion from gross
income for citizens or residents living abroad), (2) any tax-
exempt interest received or accrued during the tax year, and
(3) an amount equal to the portion of the taxpayer's social
security benefits (as defined in section 86(d)) that is
excluded from income under section 86 (that is, the amount of
the taxpayer's Social Security benefits that are excluded from
gross income).\40\ To be eligible for the premium assistance
credit, taxpayers who are married (within the meaning of
section 7703) must file a joint return. Individuals who are
listed as dependents on a return are ineligible for the premium
assistance credit.
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\39\Individuals who are lawfully present in the United States but
are not eligible for Medicaid because of their immigration status are
treated as having a household income equal to 100 percent of FPL (and
thus eligible for the premium assistance credit) as long as their
household income does not actually exceed 100 percent of FPL.
\40\The definition of modified adjusted gross income used in
section 36B is incorporated by reference for purposes of determining
eligibility to participate in certain other healthcare-related
programs, such as reduced cost-sharing (section 1402 of PPACA)),
Medicaid for the nonelderly (section 1902(e) of the Social Security Act
(42 U.S.C. 1396a(e)) as modified by section 2002(a) of PPACA) and the
Children's Health Insurance Program (section 2102(b)(1)(B) of the
Social Security Act (42 U.S.C. 1397bb(b)(1)(B)) as modified by section
2101(d) of PPACA).
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As described in Table 1 below, premium assistance credits
are available on a sliding scale basis for individuals and
families with household incomes between 100 and 400 percent of
FPL to help offset the cost of private health insurance
premiums. The premium assistance credit amount is determined
based on the percentage of income the cost of premiums
represents, rising from two percent of income for those at 100
percent of FPL for the family size involved to 9.5 percent of
income for those at 400 percent of FPL for the family size
involved. After 2014, the percentages of income are indexed to
the excess of premium growth over income growth for the
preceding calendar year. After 2018, if the aggregate amount of
premium assistance credits and cost-sharing reductions\41\
exceeds 0.504 percent of the gross domestic product for that
year, the percentage of income is also adjusted to reflect the
excess (if any) of premium growth over the rate of growth in
the consumer price index for the preceding calendar year. For
purposes of calculating family size, individuals who are in the
country illegally are not included.
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\41\As described in section 1402 of PPACA.
TABLE 1.--THE PREMIUM ASSISTANCE CREDIT PHASE-OUT
------------------------------------------------------------------------
Initial
Household income (expressed as a premium Final premium
percent of FPL) (percentage) (percentage)
------------------------------------------------------------------------
100% up to 133%......................... 2.0 2.0
133% up to 150%......................... 3.0 4.0
150% up to 200%......................... 4.0 6.3
200% up to 250%......................... 6.3 8.05
250% up to 300%......................... 8.05 9.5
300% up to 400%......................... 9.5 9.5
------------------------------------------------------------------------
Minimum essential coverage and employer offer of health insurance
coverage
Generally, if an employee is offered minimum essential
coverage\42\ in the group market, including employer-provided
health insurance coverage, the individual is ineligible for the
premium assistance credit for health insurance purchased
through an exchange.
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\42\As defined in section 5000A(f).
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If an employee is offered unaffordable coverage by his or
her employer or the plan's share of total allowed cost of
provided benefits is less than 60 percent of such costs, the
employee can be eligible for the premium assistance credit, but
only if the employee declines to enroll in the coverage and
satisfies the conditions for receiving a premium assistance
credit through an American Health Benefit Exchange.
Unaffordable coverage, as defined by Federal law, is coverage
with a premium required to be paid by the employee that is more
than 9.5 percent of the employee's household income, based on
self-only coverage.\43\
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\43\The 9.5 percent amount is indexed for calendar years beginning
after 2014 to reflect the excess of premium growth over income growth.
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Reconciliation
If the premium assistance credit received through advance
payment exceeds the amount of premium assistance credit to
which the taxpayer is entitled for the taxable year, the
liability for the overpayment must be reflected on the
taxpayer's income tax return for the taxable year subject to a
limitation on the amount of such liability. For persons with
household income below 400 percent of FPL, the liability for
the overpayment for a taxable year is limited to a specific
dollar amount (the ``applicable dollar amount'') as shown in
Table 2 below (one-half of the applicable dollar amount shown
in Table 2 for unmarried individuals who are not surviving
spouses or filing as heads of households).\44\
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\44\Section 36B(f)(2), as amended by section 208 of the Medicare
and Medicaid Extenders Act of 2010, Pub. L. No. 111-309 and section 4
of the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange
Subsidy Overpayments Act of 2011, Pub. L. No. 112-9.
TABLE 2.--RECONCILIATION
------------------------------------------------------------------------
Applicable
Household income (expressed as a percent of FPL) dollar
amount
------------------------------------------------------------------------
Less than 100%............................................. $600
At least 200% but less than 300%........................... 1,500
At least 300% but less than 400%........................... 2,500
------------------------------------------------------------------------
If the premium assistance credit for a taxable year
received through advance payment is less than the amount of the
credit to which the taxpayer is entitled for the year, the
shortfall in the credit is also reflected on the taxpayer's tax
return for the year.
HOUSE BILL
The House bill changes the applicable dollar amount, as
shown in Table 3 below (one-half of the applicable dollar
amount shown in Table 3 for unmarried individuals who are not
surviving spouses or filing as heads of households).
TABLE 3.--ADJUSTED RECONCILIATION
------------------------------------------------------------------------
Applicable
Household income (expressed as a percent of FPL) dollar
amount
------------------------------------------------------------------------
Less than 100%............................................. $600
At least 100% but less than 150%........................... 800
At least 150% but less than 200%........................... 1,000
At least 200% but less than 250%........................... 1,500
At least 250% but less than 300%........................... 2,200
At least 300% but less than 350%........................... 2,500
At least 350% but less than 400%........................... 3,200
------------------------------------------------------------------------
Effective date.--The provision is effective on the date
of enactment.
SENATE AMENDMENT
No provision.
CONFERENCE AGREEMENT
The conference agreement does not include the provision
from the House bill.
F. Information for Administration of Social Security Provisions Related
to Noncovered Employment (sec. 5101 of the House bill and secs. 6047
and 6103(l) of the Code)
PRESENT LAW
The administrator of an employer-sponsored retirement
plan, including a plan maintained by a State or local
government, is required to comply with reporting requirements
prescribed by the IRS.\45\ In the case of a distribution to a
participant or beneficiary, the amount of the distribution and
other required information must be reported to the IRS and the
participant or beneficiary on the Form 1099-R.
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\45\Sec. 6047(d).
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Tax returns and return information (including information
returns) received by the IRS are subject to confidentiality
protections and cannot be disclosed, including to another
Federal agency, unless specifically authorized.\46\ Disclosure
of certain returns and return information to the Social
Security Administration for specific purposes is so
authorized.\47\
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\46\Sec. 6103.
\47\Sec. 6103(h)(5), (l)(1), (l)(5).
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HOUSE BILL
The House bill amends the reporting requirements
applicable to employer-sponsored retirement plans of State and
local governments to require the identification of any
distribution based in whole or in part on earnings for service
in the employ of the State or local government, to the extent
such information is known or should be known.\48\ The House
bill authorizes disclosure of this information by the IRS to
the Social Security Administration for purposes of its
administration of the Social Security Act.
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\48\For this purpose, State includes the District of Columbia, the
Commonwealth of Puerto Rico, the Virgin Islands, Guam and American
Samoa.
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Effective date.--The provision applies to distributions
and disclosures made after December 31, 2012.
SENATE AMENDMENT
No provision.
CONFERENCE AGREEMENT
The conference agreement does not include the provision
from the House bill.
G. Social Security Number Required To Claim the Refundable Portion of
the Child Tax Credit (sec. 5201 of the House bill and sec. 24 of the
Code)
PRESENT LAW
An individual may claim a tax credit for each qualifying
child under the age of 17. The maximum amount of the credit per
child is $1,000 through 2012 and $500 thereafter. A child who
is not a citizen, national, or resident of the United States
cannot be a qualifying child. If the child tax credit exceeds
the taxpayer's tax liability, the taxpayer may be eligible for
a refundable credit.
No credit is allowed to any taxpayer with respect to any
qualifying child unless the taxpayer includes the name and the
taxpayer identification number of the qualifying child on the
return of tax for the taxable year. For individual filers, a
taxpayer identification number may be either a Social Security
number (``SSN''), an IRS individual taxpayer identification
number (``ITIN''), or an IRS adoption taxpayer identification
number (``ATIN'').
HOUSE BILL
The House bill adds a requirement that the refundable
portion of the child tax credit is allowable only if the tax
return includes the taxpayer's SSN (or in the case of a joint
return, the SSN of either spouse).
Effective date.--The provision applies to taxable years
beginning after the date of enactment.
SENATE AMENDMENT
No provision.
CONFERENCE AGREEMENT
The conference agreement does not include the provision
from the House bill.
H. Excise Tax on Unemployment Compensation Benefits of High-Income
Individuals (sec. 5301 of the House bill and new sec. 5895 of the Code)
PRESENT LAW
Gross income includes any unemployment compensation
benefits received under the laws of the United States or any
State, and is taxed at the applicable individual income tax
rate.\49\
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\49\Sec. 85.
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HOUSE BILL
The House bill imposes an excise tax equal to 100 percent
on unemployment compensation benefits received by individuals
with adjusted gross income above certain thresholds. The
adjusted gross income threshold is $750,000 ($1,500,000 for
married individuals filing joint returns). The excise tax is
phased-in ratably over a $250,000 range ($500,000 for married
individuals filing joint returns). Therefore unemployment
compensation benefits are taxed at a 100 percent rate for
individuals with $1,000,000 or more of adjusted gross income
($2,000,000 or more of adjusted gross income for married
individuals filing joint returns).
The excise tax is not deductible in computing the
taxpayer's taxable income.
Effective date.--The provision applies to taxable years
beginning after December 31, 2011.
SENATE AMENDMENT
No provision.
CONFERENCE AGREEMENT
The conference agreement does not include the provision
from the House bill.
TAX COMPLEXITY ANALYSES
The following tax complexity analysis is provided
pursuant to section 4022(b) of the Internal Revenue Service
Reform and Restructuring Act of 1998, which requires the staff
of the Joint Committee on Taxation (in consultation with the
Internal Revenue Service (``IRS'') and the Treasury Department)
to provide a complexity analysis of tax legislation reported by
the House Committee on Ways and Means, the Senate Committee on
Finance, or a Conference Report containing tax provisions. The
complexity analysis is required to report on the complexity and
administrative issues raised by provisions that directly or
indirectly amend the Internal Revenue Code and that have
widespread applicability to individuals or small businesses.
For each such provision identified by the staff of the Joint
Committee on Taxation, a summary description of the provision
is provided along with an estimate of the number and type of
affected taxpayers, and a discussion regarding the relevant
complexity and administrative issues.
Following the analysis of the staff of the Joint
Committee on Taxation are the comments of the IRS and the
Treasury Department regarding each of the provisions included
in the complexity analysis, including a discussion of the
likely effect on IRS forms and any expected impact on the IRS.
1. EXTENSION OF THE PAYROLL TAX REDUCTION (SEC. 1001 OF THE CONFERENCE
AGREEMENT)
Summary description of provision
The conference agreement provides for a reduced employee
OASDI tax rate of 4.2 percent under the FICA tax, and the
equivalent portion of the RRTA tax, through 2012. Similarly,
the reduced OASDI tax rate of 10.4 percent under the SECA tax,
is extended to apply for taxable years of self-employed
individuals that begin in 2012.
Related rules concerning (1) coordination of a self-
employed individual's deductions in determining net earnings
from self-employment and income tax, (2) transfers to the
Federal Old-Age and Survivors Trust Fund, the Federal
Disability Insurance Trust Fund and the Social Security
Equivalent Benefit Account established under the Railroad
Retirement Act of 1974, and (3) determining the employee rate
of OASDI tax in applying provisions of Federal law other than
the Code also apply for 2012.
The conference agreement repeals the present-law
recapture provision applicable to a taxpayer who receives the
reduced OASDI rate with respect to more than $18,350 of wages
received during the first two months of 2012.
The bill is effective after the date of enactment.
Number of affected taxpayers
It is estimated that the provision will affect more than
10 percent of individual taxpayers and small businesses.
Discussion
It is not anticipated that taxpayers and small businesses
will need to keep additional records due to this provision.
Extensive additional regulatory guidance will not be necessary
to effectively implement the provision. It is not anticipated
that the provision will result in an increase in disputes
between small businesses and the IRS.
The provision likely will not increase the tax
preparation costs for most individuals and small businesses.
Affected individuals and small businesses will not be required
to perform additional and complex calculations to comply with
the provision.
It is anticipated that the Secretary of the Treasury will
have to make appropriate revisions to several types of tax
forms and instructions.
Department of the Treasury,
Internal Revenue Service,
Washington, DC, February 15, 2012.
Thomas A. Barthold,
Chief of Staff, Joint Committee on Taxation,
Washington, DC
Dear Mr. Barthold: I am responding to your letter dated
February 14, 2012, in which you requested a complexity analysis
related to the extension of the payroll tax holiday enacted
under section 101 of the Temporary Payroll Tax Cut Continuation
Act of 2011.
Enclosed are the combined comments of the Internal
Revenue Service and the Treasury Department for inclusion in
the complexity analysis in the Conference Report on H.R. 3630.
Our comments are based on the description of the
provision provided in your letter. The analysis does not
include administrative cost estimates for the changes that
would be required. Due to the short turnaround time, our
comments are provisional and subject to change upon a more
complete and in-depth analysis of the provision. The analysis
does not cover any other provisions of the bill.
Sincerely,
Douglas H. Shulman.
Enclosure.
COMPLEXITY ANALYSIS OF CONFERENCE AGREEMENT ON H.R. 3630
EXTENSION OF THE PAYROLL TAX HOLIDAY
The conference agreement provides for a reduced employee
OASDI tax rate of 4.2 percent under the FICA tax, and the
equivalent portion of the RRTA tax, through 2012. Similarly,
the reduced OASDI tax rate of 10.4 percent under the SECA tax
is extended for taxable years of self-employed individuals that
begin in 2012.
The agreement provides related rules concerning (1)
coordination of a self-employed individual's deductions in
determining net earnings from self-employment and income tax,
(2) transfers to the Federal Old-Age and Survivors Trust Fund,
the Federal Disability Insurance Trust Fund and the Social
Security Equivalent Benefit Account established under the
Railroad Retirement Act of 1974, and (3) determining the
employee rate of OASDI tax in applying provisions of Federal
law other than the Code that also apply for 2012.
The conference agreement repeals the present-law
recapture provision applicable to a taxpayer who receives the
reduced OASDI rate with respect to more than $18,350 of wages
received during the first two months of 2012.
IRS AND TREASURY COMMENTS
This provision is an extension of current law
(except for the repeal of the recapture of excess benefit) and
should not add significant burden to taxpayers and the public
in general.
IRS has taken measures to prepare in case the
Temporary Payroll Tax Cut is not extended, including revising
forms and instructions and programming systems. If this
provision is enacted, the IRS will have to adjust its forms and
systems to reflect the extension. Computer software providers
and large employers may also have programmed their systems for
current law and would need to make similar adjustments.
No new guidance would be required.
IRS will have to make small modifications to
certain notices to, and publications for, employers.
There will be minimal impact on IRS training and
the Internal Revenue Manual.
Pursuant to clause 9 of rule XXI of the Rules of the
House of Representatives, no provision in this conference
report or joint explanatory statement includes a congressional
earmark, limited tax benefit, or limited tariff benefit.
Dave Camp,
Fred Upton,
Kevin Brady,
Greg Walden,
Tom Price,
Tom Reed,
Renee L. Ellmers,
Nan A.S. Hayworth,
Sander M. Levin,
Xavier Becerra,
Chris Van Hollen,
Allyson Y. Schwartz,
Henry A. Waxman,
Managers on the Part of the House.
Max Baucus,
Jack Reed,
Benjamin L. Cardin,
Robert P. Casey, Jr.,
Managers on the Part of the Senate.
