Enrolled SB 170: Modifying the Alaska unemployment insurance statutes by redefining the base period for determining eligibility for unemployment benefits; relating to contributions, interest, penalties, and payments under the Alaska Employment Security Act; and providing for an effective date.
00Enrolled SB 170 01 Modifying the Alaska unemployment insurance statutes by redefining the base period for 02 determining eligibility for unemployment benefits; relating to contributions, interest, 03 penalties, and payments under the Alaska Employment Security Act; and providing for an 04 effective date. 05 _______________ 06 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 07 to read: 08 LEGISLATIVE FINDINGS AND INTENT. (a) The legislature finds that 09 (1) P.L. 106-544 (Consolidated Appropriations Act, 2001) amended 26 U.S.C. 10 3301 - 3311 (Federal Unemployment Tax Act) to require certified state unemployment 11 insurance programs to provide federally recognized tribes and their wholly owned 12 subdivisions, subsidiaries, or businesses the option to be a reimbursable employer; 13 (2) the state's unemployment insurance program has been certified by the 14 United States Department of Labor;
01 (3) as a certified program, the Department of Labor and Workforce 02 Development receives federal funds to administer its unemployment insurance program; 03 (4) because this state has a certified program, Alaska employers receive a tax 04 credit of up to 90 percent of the federal unemployment tax that employers are required to pay; 05 (5) to maintain its certified status, this state must conform AS 23.20 (Alaska 06 Employment Security Act) with the requirements of 26 U.S.C. 3301 - 3311 (Federal 07 Unemployment Tax Act); 08 (6) failure to bring AS 23.20 (Alaska Employment Security Act) into 09 compliance with federal legislation could result in the loss of approximately $20,000,000 in 10 administrative funding under 26 U.S.C. 3301 - 3311 (Federal Unemployment Tax Act) and 11 the loss of approximately $111,000,000 in tax credits under 26 U.S.C. 3301 - 3311 (Federal 12 Unemployment Tax Act) to employers in this state; 13 (7) of the 33 states that have federally recognized tribes, Alaska is the only 14 state that has not yet passed conforming legislation; and 15 (8) to bring AS 23.20 (Alaska Employment Security Act) into conformity with 16 26 U.S.C. 3301 - 3311 (Federal Unemployment Tax Act), it is necessary to amend AS 23.20 17 to allow federally recognized tribes and their wholly owned subdivisions, subsidiaries, or 18 businesses the option to be a reimbursable employer. 19 (b) It is the intent of the legislature that this Act not alter or expand in any way the 20 governmental relationship between federally recognized tribes and the state. 21 * Sec. 2. AS 23.20.277(b) is amended to read: 22 (b) At the end of each calendar quarter, or at the end of any other period as 23 determined by the department, the department shall bill each government entity, 24 federally recognized tribe, nonprofit organization, or group of nonprofit 25 organizations that has elected to make payments in place of contributions, for benefits 26 paid during the quarter or other prescribed period that are attributable to service in the 27 employ of the government entity, federally recognized tribe, nonprofit organization, 28 or group. In the case of nonprofit organizations and groups of nonprofit organizations, 29 the amount billed is an amount equal to the full amount of regular benefits plus 30 extended benefits that are not reimbursable by the federal government. In the case of a 31 government entity or federally recognized tribe, the amount billed is an amount
01 equal to the full amount of the regular benefits plus the full amount of the extended 02 benefits paid. 03 * Sec. 3. AS 23.20.277(e) is amended to read: 04 (e) At the end of each taxable year, the department shall determine whether 05 the total of payments for the year made by a nonprofit organization or group of 06 nonprofit organizations is less than, or in excess of, the total amount of regular 07 benefits plus extended benefits not reimbursable by the federal government paid to 08 individuals during the taxable year based on wages attributable to service in the 09 employ of the nonprofit organization or group. In the case of a government entity or 10 federally recognized tribe that has elected to make payments under this section, the 11 department shall determine whether the total of payments for the year is less than, or 12 in excess of, the total amount of regular benefits plus the total amount of extended 13 benefits as determined in this subsection. If [EACH ORGANIZATION OR GROUP 14 WHOSE] total payments for the taxable year are less than the amount so determined, 15 the employer is liable for payment of the unpaid balance to the fund in accordance 16 with (f) of this section. If the total payments exceed the amount so determined for the 17 taxable year, all or part of the excess may, at the discretion of the department, be 18 refunded from the fund or retained in the fund as part of the payments that may be 19 required for the next taxable year. 20 * Sec. 4. AS 23.20.277(f) is amended to read: 21 (f) Payment of any bill rendered under (b) or (c) of this section shall be made 22 not later than 30 days after the bill was mailed to the last known address of the 23 nonprofit organization, group of nonprofit organizations, government entity, or 24 federally recognized tribe or was otherwise delivered to it, unless there has been an 25 application for review and redetermination in accordance with (h) of this section. 26 * Sec. 5. AS 23.20.277(g) is amended to read: 27 (g) Payments made by any nonprofit organization, group of nonprofit 28 organizations, government entity, or federally recognized tribe under the 29 provisions of this section may not be deducted or deductible, in whole or in part, from 30 the remuneration of an individual [INDIVIDUALS] in the employ of the 31 organization, group of organizations, government entity, or federally recognized
01 tribe; nor may contributions be required of an employee on the basis of wages paid to 02 that employee for services performed by the employee in employment for a nonprofit 03 organization, group of nonprofit organizations, government entity, or federally 04 recognized tribe that [WHICH] makes an election to become liable for payments in 05 place of contributions under AS 23.20.276 - 23.20.278 [AS 23.20.276], and the wages 06 are paid during the period of election. 07 * Sec. 6. AS 23.20.277(h) is amended to read: 08 (h) The amount due, specified in a bill from the department, is conclusive on 09 the employer [ORGANIZATION] unless, not later than 30 days after the bill was 10 mailed to its last address of record or otherwise delivered to it, the employer 11 [ORGANIZATION] files an application for redetermination by the department, setting 12 out the grounds for the application. The department shall promptly review and 13 reconsider the bill and shall [THEREAFTER] issue a redetermination in any case in 14 which an application for redetermination has been filed. Any redetermination is 15 conclusive on the employer [ORGANIZATION] unless, not later than 30 days after 16 the redetermination was mailed to its last address of record or otherwise delivered to 17 it, the employer [ORGANIZATION] files an appeal to the commissioner, setting out 18 the grounds for the appeal. Proceedings on appeal to the commissioner from the 19 amount of a bill rendered under this subsection or a redetermination of the amount 20 shall be in accordance with AS 23.20.410 - 23.20.470. 21 * Sec. 7. AS 23.20.277(j) is amended to read: 22 (j) At the discretion of the department, a nonprofit organization, group of 23 nonprofit organizations, government entity, or federally recognized tribe that 24 elects to become liable for payments in place of contributions under AS 23.20.276 - 25 23.20.278 [AS 23.20.276] is required, within 30 days after the effective date of its 26 election, to execute and file with the department a surety bond approved by the 27 department or it may elect instead to deposit with the department money or securities. 28 The amount of the bond or deposit shall be determined by the department in 29 accordance with regulations adopted by the department. 30 * Sec. 8. AS 23.20.277(k) is amended to read: 31 (k) If a nonprofit organization, group of nonprofit organizations,
01 government entity, or federally recognized tribe is delinquent in making payments 02 in place of contributions as required under this section and after having been given 03 notice, the department, after giving notice to the employer who is delinquent, shall 04 [MAY] terminate that employer's [ORGANIZATION'S] election to make payments 05 in place of contributions until a time provided by regulations adopted by the 06 department [AS OF THE BEGINNING OF THE NEXT TAXABLE YEAR, AND 07 THE TERMINATION IS EFFECTIVE FOR THAT AND THE NEXT TAXABLE 08 YEAR]. 09 * Sec. 9. AS 23.20.277(l) is amended to read: 10 (l) Each employer that is liable for payments in place of contributions shall 11 pay to the department for the fund the amount of regular benefits plus the extended 12 benefits not reimbursable by the federal government paid to individuals that are 13 attributable to service in the employ of that employer. However, a government entity 14 or federally recognized tribe that has elected to make payments under this section is 15 liable for the amount of regular benefits plus the full amount of extended benefits that 16 are attributable to service in the employ of that entity or tribe. If benefits paid to an 17 individual are based on wages paid by more than one employer and one or more of 18 these employers is liable for payments in place of contributions, the amount payable to 19 the fund by each employer that is liable for payments shall be determined by the 20 department in accordance with regulations adopted by the department. 21 * Sec. 10. AS 23.20.277 is amended by adding a new subsection to read: 22 (m) The department may not approve an election to make payments in place 23 of contributions if, at the time of the election, a nonprofit organization, group of 24 nonprofit organizations, government entity, or federally recognized tribe is delinquent 25 in making contributions under AS 23.20.165. 26 * Sec. 11. AS 23.20.278 is amended to read: 27 Sec. 23.20.278. Financing benefits paid to employees of the state, [AND 28 ITS] political subdivisions of the state, or a federally recognized tribe. A federally 29 recognized tribe, a political subdivision, or a department, division, or other agency of 30 the state subject to this chapter, under AS 23.20.525(a)(14) [AS 23.20.525(a)(4) AND 31 (14)], shall pay contributions under the provisions of AS 23.20.165, unless it elects to
01 reimburse the department for the unemployment compensation fund according to the 02 provisions applicable to nonprofit organizations, government entities, or federally 03 recognized tribes under AS 23.20.276 and 23.20.277. 04 * Sec. 12. AS 23.20.381(j) is amended to read: 05 (j) Benefits based on services described in (e) and (h) of this section shall be 06 denied under (e), (h), and (i) of this section to an individual who performed those 07 services in an educational institution while in the employ of an educational service 08 agency. In this subsection, "educational service agency" means a governmental 09 agency, [OR] governmental entity, or federally recognized tribe that is established 10 and operated exclusively for the purpose of providing services to one or more 11 educational institutions [INSTITUTION]. 12 * Sec. 13. AS 23.20.520(3) is amended to read: 13 (3) "base period" means the first four of the last five completed 14 calendar quarters immediately preceding the first day of an individual's benefit year, 15 except that, if an individual would not otherwise be eligible for unemployment 16 compensation because of the use of a base period that does not include the most 17 recently completed calendar quarter immediately preceding the first day of an 18 individual's benefit year, "base period" means, and eligibility shall be 19 determined using, the four most recently completed calendar quarters before the 20 start of the benefit year; 21 * Sec. 14. AS 23.20.520(10) is amended to read: 22 (10) "employing unit" means one or more departments or other 23 agencies of the state, a political subdivision of the state, a federally recognized tribe, 24 an individual, or a type of organization, partnership, association, trust, estate, joint 25 trust company, insurance company, or domestic or foreign corporation, or the receiver, 26 referee in bankruptcy, trustee, or successor of one of these, or the legal representative 27 of a deceased person, that [WHICH] has or [, AFTER JANUARY 1, 1937,] had one 28 or more individuals performing service for it in the state; an individual performing 29 services in the state for an employing unit that [WHICH] maintains two or more 30 separate establishments in the state is considered as employed by a single employing 31 unit for the purposes of this chapter; notwithstanding any provision in this chapter, any
01 employing unit that [WHICH] employs individuals whose services must be covered 02 by the unemployment insurance laws of this state [AFTER DECEMBER 31, 1971] as 03 a condition of approval of the unemployment insurance laws of this state under 26 04 U.S.C. 3304(a) (Internal Revenue Code of 1954), as amended, will be considered an 05 employer as to those individuals and is subject to contributions on all wages paid 06 [AFTER DECEMBER 31, 1971,] or reimbursement payments to cover benefits paid 07 based on services performed [AFTER DECEMBER 31, 1971], depending on the 08 applicable law; 09 * Sec. 15. AS 23.20.520(14) is amended to read: 10 (14) "institution of higher education" means an educational institution 11 that [WHICH] 12 (A) admits as regular students only individuals having a 13 certificate of graduation from a high school, or the recognized equivalent of a 14 high school graduation certificate; 15 (B) is legally authorized in the state in which it is located to 16 provide a program of education beyond high school; 17 (C) provides an educational program for which it awards a 18 bachelor's or higher degree, or provides a program that [WHICH] is 19 acceptable for full credit toward either degree, a program of postgraduate or 20 postdoctoral studies, or a program of training to prepare students for gainful 21 employment in a recognized occupation; and 22 (D) is operated by a federally recognized tribe or is a public 23 or other nonprofit institution; 24 * Sec. 16. AS 23.20.520 is amended by adding a new paragraph to read: 25 (22) "federally recognized tribe" 26 (A) means a tribe that is recognized by the United States 27 Secretary of the Interior to exist as an Indian tribe under 25 U.S.C. 479a 28 (Federally Recognized Indian Tribe List Act of 1994); 29 (B) includes any subdivision, subsidiary, or business enterprise 30 wholly owned by a federally recognized tribe. 31 * Sec. 17. AS 23.20.525(a)(14) is amended to read:
01 (14) service performed [AFTER DECEMBER 31, 1977,] in the 02 employ of this state or any of its instrumentalities or any political subdivision of this 03 state or any of its instrumentalities or any instrumentality of any of the foregoing and 04 one or more other states or political subdivisions, or in the employ of a federally 05 recognized tribe, if that service is excluded from "employment" under 26 U.S.C. 06 3306(c)(7) (Federal Unemployment Tax Act, Internal Revenue Code) and is not 07 excluded from "employment" under AS 23.20.526(d) [AS 23.20.526(d)(8)]; 08 * Sec. 18. AS 23.20.526(d) is amended to read: 09 (d) For the purposes of AS 23.20.525(a)(6) and (14) [AS 23.20.525(a)(4) - (6) 10 AND (14)], the term "employment" does not apply to service performed 11 (1) by a duly ordained, commissioned, or licensed minister of a church 12 in the exercise of the person's ministry or by a member of a religious order in the 13 exercise of duties required by the order; 14 (2) in a facility conducted for the purpose of carrying out a program of 15 rehabilitation for individuals whose earning capacity is impaired by age or physical or 16 mental deficiency or injury or providing remunerative work for individuals who, 17 because of their impaired physical or mental capacity, cannot be readily absorbed in 18 the competitive labor market by an individual receiving the rehabilitation or 19 remunerative work; 20 (3) as part of an unemployment work-relief or work-training program 21 assisted or financed in whole or in part by a federally recognized tribe or any federal 22 agency or any agency of a state or political subdivision of the state, by an individual 23 receiving work relief or work training; 24 (4) for a state hospital by an inmate of a prison or correctional 25 institution; 26 (5) in the employ of a school, college, or university if the service is 27 performed by a student who is enrolled and is regularly attending classes at the school, 28 college, or university; 29 (6) by an individual under the age of 22 who is enrolled at a nonprofit 30 or public educational institution that normally maintains a regular faculty and 31 curriculum and normally has a regularly organized body of students in attendance at
01 the place where its educational activities are carried on as a student in a full-time 02 program, taken for credit at the institution, that combines academic instruction with 03 work experience if the service is an integral part of the program and the institution has 04 so certified to the employer, except that this paragraph does not apply to service 05 performed in a program established for or on behalf of an employer or group of 06 employers; 07 (7) in the employ of a hospital if the service is performed by a patient 08 of the hospital, as defined in AS 23.20.520; 09 (8) in the employ of the state or a political subdivision of the state if 10 the service is performed by an individual in the exercise of duties 11 (A) as a judicial officer, the governor, the lieutenant governor, 12 a person hired or appointed as the head or deputy head of a department in the 13 executive branch, a person hired or appointed as the director of a division of a 14 department in the executive branch, an assistant to the governor, a chair or 15 member of a state commission or board, state investment officers and the state 16 comptroller in the Department of Revenue, an appointed or elected municipal 17 officer, any other elected official, the fiscal analyst of the legislative finance 18 division, the legislative auditor of the legislative audit division, the executive 19 director of the Legislative Affairs Agency, and the directors of the divisions 20 within the Legislative Affairs Agency; 21 (B) as a member of the Alaska Army National Guard or Alaska 22 Air National Guard or Alaska Naval Militia; 23 (C) as an employee serving on only a temporary basis in case 24 of fire, storm, snow, earthquake, flood, or similar emergency; or 25 (D) as an election official or election worker if the amount of 26 remuneration received by the individual during the calendar year for services 27 as an election official or election worker is less than $1,000; 28 (9) in the employ of 29 (A) a church or a convention or association of churches; or 30 (B) an organization that is operated primarily for religious 31 purposes and that is operated, supervised, controlled, or principally supported
01 by a church or a convention or association of churches; 02 (10) in the employ of a federally recognized tribe in this state if the 03 service is performed by an individual in the exercise of duties as an officer of the 04 federally recognized tribe and meets the requirements of 26 U.S.C. 3309(b)(3)(E) 05 (Federal Unemployment Tax Act, Internal Revenue Code). 06 * Sec. 19. The uncodified law of the State of Alaska is amended by adding a new section to 07 read: 08 REVISOR'S INSTRUCTION. The revisor of statutes shall change the heading of 09 AS 23.20.277 from "Reimbursement payments by nonprofit organizations and government 10 entities" to "Reimbursement payments by nonprofit organizations, government entities, and 11 federally recognized tribes." 12 * Sec. 20. Section 13 of this Act takes effect January 1, 2010. 13 * Sec. 21. Sections 1 - 12 and 14 - 19 of this Act take effect immediately under 14 AS 01.10.070(c).