Report Title:

UI; State Additional Benefits

Description:

Creates a program to provide additional unemployment insurance benefits provided that the federal Temporary Extended Unemployment Compensation program is not extended after August 1, 2003. Provides that additional state benefits will cease once the unemployment insurance fund reaches the threshold that would require DLIR to increase unemployment taxes. Conforms state statutory provisions to the federal Temporary Extended Unemployment Compensation Act of 2002. Allows UI fund to be used to pay for UI benefits as well as administrative costs. (HB290 SD1)

HOUSE OF REPRESENTATIVES

H.B. NO.

290

TWENTY-SECOND LEGISLATURE, 2003

H.D. 2

STATE OF HAWAII

S.D. 1


 

A BILL FOR AN ACT

 

RELATING TO UNEMPLOYMENT.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The legislature finds that over the last several years, Hawaii's economy experienced a significant downturn, especially in the visitor industry. Although visitor arrival numbers appear to have stabilized and seem to be rebounding and economic predictions look promising, Hawaii's economic future remains uncertain, especially due to the unpredictability of escalating global events, which may also have devastating consequences for Hawaii's fragile economy.

The legislature realizes that since 2001, an unprecedented number of individuals experienced layoffs, work furloughs, and decreased work hours and that action is needed to help support those in the State who are still affected by the economic downturn.

The purpose of this Act is to:

(1) Create a program to extend unemployment insurance benefits; provided that the federal Temporary Extended Unemployment Compensation program is not extended after May 31, 2003;

(2) Ensure that state benefits will cease once the unemployment insurance fund reaches the threshold where the department of labor and industrial relations would be required to increase the unemployment taxes paid by employers;

(3) Conform state statutory provisions to the federal Temporary Extended Unemployment Compensation Act of 2002; and

(4) Provide that unemployment insurance trust fund moneys can be used to pay for unemployment benefits as well as administrative costs.

SECTION 2. Section 383-123, Hawaii Revised Statutes, is amended as follows:

1. By amending subsection (b) to read:

"(b) Administrative use. Moneys credited to the account of this State in the unemployment trust fund by the Secretary of the Treasury of the United States pursuant to section 903 of the Social Security Act, as amended, may be requisitioned and used for the payment of benefits and for the payment of expenses incurred for the administration of this State's unemployment compensation law and public employment offices pursuant to a specific appropriation of the legislature; provided that the expenses are incurred and the money is requisitioned after the enactment of an appropriation law which: (1) specifies the purposes for which the moneys are appropriated and the amounts appropriated therefor, (2) limits the period within which the moneys may be obligated to a period ending not more than two years after the date of the enactment of the appropriation law, and (3) limits the amount which may be obligated [during a twelve-month period beginning on July 1 and ending on the next June 30] to an amount which does not exceed the amount by which (A) the aggregate of the amounts credited to the account of this State pursuant to section 903 of the Social Security Act, as amended, [during the same twelve-month period and the thirty-four preceding twelve-month periods] exceeds (B) the aggregate of the amounts obligated pursuant to this subsection and charged against the amounts credited to the account of this State [during such thirty-five twelve-month periods. For the purposes of this subsection, amounts which are obligated for administration or paid out for benefits shall be charged against equivalent amounts which were first credited and which are not already so charged; except that no amount obligated for administration during a twelve-month period specified herein may be charged against any amount credited during such twelve-month period earlier than the thirty-fourth preceding such period].

Moneys credited to the account of this State pursuant to section 903 of the Social Security Act, as amended, may not be withdrawn or used except for the payment of benefits and for the payment of expenses for the administration of this chapter pursuant to this subsection.

The appropriation, obligation, and expenditure or other disposition of money appropriated under this subsection shall be accounted for in accordance with standards established by the United States Secretary of Labor. Moneys appropriated for the payment of expenses of administration pursuant to this subsection shall be requisitioned as needed for the payment of obligations incurred under the law appropriating the moneys and, upon requisition, shall be deposited in the employment security administration fund from which such payments shall be made. Moneys so deposited shall, until expended, remain a part of the unemployment compensation fund and, if it will not be expended within one week after it is withdrawn from the unemployment trust fund, shall be returned at the earliest practical date to the Secretary of the Treasury of the United States for credit to this State's account in the unemployment trust fund.

2. By amending subsection (c) to read:

"(c) Notwithstanding subsection (b), moneys credited to the State's account in federal fiscal years ending in 2000, 2001, and 2002 shall be used solely for the administration of the unemployment compensation program and are not subject to the specific appropriation requirements of subsection (b)[.]; except that moneys credited in calendar year 2002 pursuant to P.L. 107-147 shall not be subject to the conditions of this subsection or the two-year limitation requirement specified in subsection (b)."

SECTION 3. For the purpose of this Act:

"Applicable benefit year" means the individual's current benefit year if the individual has an unexpired benefit year or the individual's most recent benefit year for regular benefits.

"Benefit year" shall be as defined in section 383-1, Hawaii Revised Statutes.

"Continued claim certification" means an application that certifies the completion of a week of total, part-total, or partial unemployment to claim benefits for a week of unemployment as defined in section 12-5-73, Hawaii Administrative Rules.

"Eligibility period" means, for the receipt of state additional benefits, the period beginning on the first Sunday following the date that this Act is approved by the governor.

"Initial claim" includes a new claim, an additional claim, or a reopened claim as defined in section 12-5-73, Hawaii Administrative Rules.

"Regular benefits" means the unemployment insurance benefits paid on an initial claim filed under chapter 383, Hawaii Revised Statutes, except as provided for in sections 383-168 through 383-176, Hawaii Revised Statutes.

"State additional benefits" means the unemployment compensation benefits payable under this Act.

"Week of unemployment" shall be as defined in section 383-1, Hawaii Revised Statutes.

SECTION 4. An individual shall be eligible to receive a payment of state additional benefits with respect to a week of unemployment in accordance with the provisions of this Act; provided that:

(1) The federal Temporary Extended Unemployment Compensation program is not extended after May 31, 2003;

(2) The individual filed an initial claim or continued claim certification for regular benefits on or after September 11, 2001, and was paid benefits for the period after September 11, 2001;

(3) The week of unemployment falls within the eligibility period;

(4) The individual exhausted all rights to receive regular benefits under chapter 383, Hawaii Revised Statutes, on or after September 11, 2001, or if regular benefits were not exhausted, the individual's applicable benefit year expired on or after September 11, 2001;

(5) The individual is not eligible to receive unemployment benefits under federal law or the laws of any other state, or any federal or federal-state extended benefits program, after September 11, 2001;

(6) Any additional or extended unemployment benefits paid under federal law or the laws of any other state, or any federal or federal-state extended benefits program, shall not be deducted from the total state additional benefits amount the individual is eligible for, but shall be in addition to state additional benefits, and state additional benefits shall be paid only when those federal, federal-state, or other state's extended benefits are not payable to the individual; and

(7) The individual has met all other conditions of eligibility that apply to regular benefits as required under chapter 383, Hawaii Revised Statutes, except that no individual shall be required to serve a waiting period in the eligibility period.

SECTION 5. (a) The weekly state additional benefits amount payable to an individual for a week of total unemployment in the eligibility period shall be an amount equal to the weekly benefit amount payable in the individual's applicable benefit year.

(b) The maximum state additional benefits amount payable to any eligible individual with respect to the individual's applicable benefit year shall be thirteen times the individual's weekly state additional benefits amount.

(c) No state additional benefits shall be payable for any week beginning prior to the eligibility period or after the close of the eligibility period.

SECTION 6. Benefits paid to an individual under the state additional benefits program shall be charged against the account of any of the individual's base period employers except for employers on a contributory plan under section 383-61, Hawaii Revised Statutes.

SECTION 7. For the purposes of this Act, section 383-68, Hawaii Revised Statutes, shall not apply and the contribution rate schedule shall be maintained at schedule D. The governor may provide for a schedule change only by issuance of a proclamation specifically invoking the change and the effective date of the change.

State additional benefits shall cease once the unemployment insurance fund reaches the threshold where the department of labor and industrial relations would be required to increase the unemployment taxes paid by employers.

SECTION 8. The funds for state additional benefits payable under this Act shall be withdrawn from the unemployment compensation trust fund pursuant to sections 383-121 to 383-123, Hawaii Revised Statutes. If necessary, additional moneys may be allocated from the state general fund and used for the payment of expenses incurred for the administration of state additional benefits.

SECTION 9. Except when the result would be inconsistent with the provisions of this Act, the provisions of chapter 383, Hawaii Revised Statutes, which apply to claims for, or the payment of, regular benefits shall apply to claims for, and the payment of state additional benefits.

SECTION 10. No provision contained in this Act shall apply to the payment of state additional benefits if that provision conflicts with federal statutes and jeopardizes the receipt of federal administrative funding and certification for the Federal Unemployment Tax Act employer tax offset credit.

In the event any provision in this Act jeopardizes the receipt of federal funds, the governor is authorized to revise any provision of this Act to the extent required to maximize the receipt of federal funds. The governor shall promptly report any such revision and reasons therefor to the legislature at the next legislative session thereafter.

SECTION 11. There is appropriated out of the general revenues of the State of Hawaii the sum of $1 or so much thereof as may be necessary for fiscal year 2003-2004 to create a program providing additional benefits to unemployed workers by extending their unemployment insurance benefits.

The sum appropriated shall be expended by the department of labor and industrial relations for the purposes of this Act.

SECTION 12. This Act shall take effect on July 1, 2053 and shall be repealed on .