42 USC 1103 - Amounts transferred to State accounts

(a) Determination and certification by Secretary of Labor 

(1) If as of the close of any fiscal year after the fiscal year ending June 30, 1972, the amount in the extended unemployment compensation account has reached the limit provided in section 1105 (b)(2) of this title and the amount in the Federal unemployment account has reached the limit provided in section 1102 (a) of this title and all advances and interest pursuant to section 1105 (d) of this title and section 1323 of this title have been repaid, and there remains in the employment security administration account any amount over the amount provided in section 1101 (f)(3)(A) of this title, such excess amount, except as provided in subsection (b) of this section, shall be transferred (as of the beginning of the succeeding fiscal year) to the accounts of the States in the Unemployment Trust Fund.
(2) Each States share of the funds to be transferred under this subsection as of any October 1
(A) shall be determined by the Secretary of Labor and certified by such Secretary to the Secretary of the Treasury before such date, and

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(B) shall bear the same ratio to the total amount to be so transferred as
(i) the amount of wages subject to tax under section 3301 of the Internal Revenue Code of 1986 during the preceding calendar year which are determined by the Secretary of Labor to be attributable to the State, bears to
(ii) the total amount of wages subject to such tax during such year.
(b) Transfer of funds where State is ineligible 

(1) If the Secretary of Labor finds that on October 1 of any fiscal year
(A) a State is not eligible for certification under section 503 of this title, or
(B) the law of a State is not approvable under section 3304 of the Federal Unemployment Tax Act [26 U.S.C. 3304],

then the amount available for transfer to such States account shall, in lieu of being so transferred, be transferred to the Federal unemployment account as of the beginning of such October 1. If, during the fiscal year beginning on such October 1, the Secretary of Labor finds and certifies to the Secretary of the Treasury that such State is eligible for certification under section 503 of this title, that the law of such State is approvable under such section 3304, or both, the Secretary of the Treasury shall transfer such amount from the Federal unemployment account to the account of such State. If the Secretary of Labor does not so find and certify to the Secretary of the Treasury before the close of such fiscal year then the amount which was available for transfer to such States account as of October 1 of such fiscal year shall (as of the close of such fiscal year) become unrestricted as to use as part of the Federal unemployment account.

(2) The amount which, but for this paragraph, would be transferred to the account of a State under subsection (a) of this section or paragraph (1) of this subsection shall be reduced (but not below zero) by the balance of advances made to the State under section 1321 of this title. The sum by which such amount is reduced shall
(A) be transferred to or retained in (as the case may be) the Federal unemployment account, and
(B) be credited against, and operate to reduce

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(i) first, any balance of advances made before September 13, 1960, to the State under section 1321 of this title, and
(ii) second, any balance of advances made on or after September 13, 1960, to the State under section 1321 of this title.
(c) Use of funds 

(1) Except as provided in paragraph (2), amounts transferred to the account of a State pursuant to subsections (a) and (b) of this section shall be used only in the payment of cash benefits to individuals with respect to their unemployment, exclusive of expenses of administration.
(2) A State may, pursuant to a specific appropriation made by the legislative body of the State, use money withdrawn from its account in the payment of expenses incurred by it for the administration of its unemployment compensation law and public employment offices if and only if
(A) the purposes and amounts were specified in the law making the appropriation,
(B) the appropriation law did not authorize the obligation of such money after the close of the two-year period which began on the date of enactment of the appropriation law,
(C) the money is withdrawn and the expenses are incurred after such date of enactment,
(D) 
(i) the appropriation law limits the total amount which may be obligated under such appropriation at any time to an amount which does not exceed, at any such time, the amount by which
(I) the aggregate of the amounts transferred to the account of such State pursuant to subsections (a) and (b) of this section, exceeds
(II) the aggregate of the amounts used by the State pursuant to this subsection and charged against the amounts transferred to the account of such State, and
(ii) for purposes of clause (i), amounts used by a State for administration shall be chargeable against transferred amounts at the exact time the obligation is entered into, and
(E) the use of the money is accounted for in accordance with standards established by the Secretary of Labor.
(3) 
(A) If
(i) amounts transferred to the account of a State pursuant to subsections (a) and (b) of this section were used in payment of unemployment benefits to individuals; and
(ii) the Governor of such State submits a request to the Secretary of Labor that such amounts be restored under this paragraph,

then the amounts described in clause (i) shall be restored to the status of funds transferred under subsections (a) and (b) of this section which have not been used by eliminating any charge against amounts so transferred for the use of such amounts in the payment of unemployment benefits.

(B) Subparagraph (A) shall apply only to the extent that the amounts described in clause (i) of such subparagraph do not exceed the amount then in the States account.
(C) Subparagraph (A) shall not apply if the State has a balance of advances made to its account under subchapter XII of this chapter.
(D) If the Secretary of Labor determines that the requirements of this paragraph are met with respect to any request, the Secretary shall notify the Governor of the State that such requirements are met with respect to such request and the amount restored under this paragraph. Such restoration shall be as of the first day of the first month following the month in which the notification is made.
(d) Special transfer in fiscal year 2002 

(1) The Secretary of the Treasury shall transfer (as of the date determined under paragraph (5)) from the Federal unemployment account to the account of each State in the Unemployment Trust Fund the amount determined with respect to such State under paragraph (2).
(2) 
(A) The amount to be transferred under this subsection to a State account shall (as determined by the Secretary of Labor and certified by such Secretary to the Secretary of the Treasury) be equal to
(i) the amount which would have been required to have been transferred under this section to such account at the beginning of fiscal year 2002 if
(I) section 209(a)(1) of the Temporary Extended Unemployment Compensation Act of 2002 had been enacted before the close of fiscal year 2001, and
(II) section 5402 of Public Law 10533 (relating to increase in Federal unemployment account ceiling) had not been enacted,

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(ii) the amount which was in fact transferred under this section to such account at the beginning of fiscal year 2002.
(B) Notwithstanding the provisions of subparagraph (A)
(i) the aggregate amount transferred to the States under this subsection may not exceed a total of $8,000,000,000; and
(ii) all amounts determined under subparagraph (A) shall be reduced ratably, if and to the extent necessary in order to comply with the limitation under clause (i).
(3) 
(A) Except as provided in paragraph (4), amounts transferred to a State account pursuant to this subsection may be used only in the payment of cash benefits
(i) to individuals with respect to their unemployment, and
(ii) which are allowable under subparagraph (B) or (C).
(B) 
(i) At the option of the State, cash benefits under this paragraph may include amounts which shall be payable as
(I) regular compensation, or
(II) additional compensation, upon the exhaustion of any temporary extended unemployment compensation (if such State has entered into an agreement under the Temporary Extended Unemployment Compensation Act of 2002), for individuals eligible for regular compensation under the unemployment compensation law of such State.
(ii) Any additional compensation under clause (i) may not be taken into account for purposes of any determination relating to the amount of any extended compensation for which an individual might be eligible.
(C) 
(i) At the option of the State, cash benefits under this paragraph may include amounts which shall be payable to 1 or more categories of individuals not otherwise eligible for regular compensation under the unemployment compensation law of such State, including those described in clause (iii).
(ii) The benefits paid under this subparagraph to any individual may not, for any period of unemployment, exceed the maximum amount of regular compensation authorized under the unemployment compensation law of such State for that same period, plus any additional compensation (described in subparagraph (B)(i)) which could have been paid with respect to that amount.
(iii) The categories of individuals described in this clause include the following:
(I) Individuals who are seeking, or available for, only part-time (and not full-time) work.
(II) Individuals who would be eligible for regular compensation under the unemployment compensation law of such State under an alternative base period.
(D) Amounts transferred to a State account under this subsection may be used in the payment of cash benefits to individuals only for weeks of unemployment beginning after March 9, 2002.
(4) Amounts transferred to a State account under this subsection may be used for the administration of its unemployment compensation law and public employment offices (including in connection with benefits described in paragraph (3) and any recipients thereof), subject to the same conditions as set forth in subsection (c)(2) of this section (excluding subparagraph (B) thereof, and deeming the reference to subsections (a) and (b) in subparagraph (D) thereof to include this subsection).
(5) Transfers under this subsection shall be made within 10 days after March 9, 2002.
(e) Special transfer in fiscal year 2006 
Not later than 10 days after October 20, 2005, the Secretary of the Treasury shall transfer from the Federal unemployment account
(1) $15,000,000 to the account of Alabama in the Unemployment Trust Fund;
(2) $400,000,000 to the account of Louisiana in the Unemployment Trust Fund; and
(3) $85,000,000 to the account of Mississippi in the Unemployment Trust Fund.