B-138940, JUL. 16, 1959

B-138940: Jul 16, 1959

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ARE RECOVERABLE UNDER SECTION 104 (A) OF THAT ACT. IF OUR ANSWER IS IN THE NEGATIVE YOU REQUEST A DECISION WHETHER THE REFERRED TO EXPENSES ARE "EMPLOYMENT SECURITY ADMINISTRATIVE EXPENDITURES" WITHIN THE MEANING OF SECTION 901 (B) OF TITLE IX OF THE SOCIAL SECURITY ACT. UNLESS OR UNTIL THE SECRETARY OF THE TREASURY FINDS THAT BY DECEMBER 1 OF THE TAXABLE YEAR THERE HAVE BEEN RESTORED TO THE TREASURY THE AMOUNTS OF TEMPORARY UNEMPLOYMENT COMPENSATION PAID IN THE STATE UNDER THIS ACT (EXCEPT AMOUNTS PAID TO INDIVIDUALS WHO EXHAUSTED THEIR UNEMPLOYMENT COMPENSATION UNDER TITLE XV OF THE SOCIAL SECURITY ACT AND TITLE IV OF THE VETERANS' READJUSTMENT ASSISTANCE ACT OF 1952 PRIOR TO THEIR MAKING THEIR FIRST CLAIMS UNDER THIS ACT).

B-138940, JUL. 16, 1959

TO THE SECRETARY OF LABOR:

YOUR LETTER OF MARCH 6, 1959, REQUESTS A DECISION WHETHER THE REASONABLE EXPENSES INCURRED BY THE DEPARTMENT OF THE TREASURY IN ADMINISTERING THE TEMPORARY UNEMPLOYMENT COMPENSATION ACT OF 1958, 72 STAT. 171, ARE RECOVERABLE UNDER SECTION 104 (A) OF THAT ACT. IF OUR ANSWER IS IN THE NEGATIVE YOU REQUEST A DECISION WHETHER THE REFERRED TO EXPENSES ARE "EMPLOYMENT SECURITY ADMINISTRATIVE EXPENDITURES" WITHIN THE MEANING OF SECTION 901 (B) OF TITLE IX OF THE SOCIAL SECURITY ACT, AS AMENDED, 42 U.S.C. 1101 (B).

SECTION 104 (A) OF THE TEMPORARY UNEMPLOYMENT COMPENSATION ACT OF 1958 PROVIDES:

"THE TOTAL CREDITS ALLOWED UNDER SECTION 3302 (C) OF THE FEDERAL UNEMPLOYMENT TAX ACT (26 U.S.C. 3302 (C) TO TAXPAYERS WITH RESPECT TO WAGES ATTRIBUTABLE TO A STATE FOR THE TAXABLE YEAR BEGINNING ON JANUARY 1, 1963, AND FOR EACH TAXABLE YEAR THEREAFTER, SHALL BE REDUCED IN THE SAME MANNER AS THAT PROVIDED BY SECTION 3302 (C) (2) OF THE FEDERAL UNEMPLOYMENT TAX ACT FOR THE REPAYMENT OF ADVANCES MADE UNDER TITLE XII OF THE SOCIAL SECURITY ACT, AS AMENDED (42 U.S.C. 1321 ET SEQ.), UNLESS OR UNTIL THE SECRETARY OF THE TREASURY FINDS THAT BY DECEMBER 1 OF THE TAXABLE YEAR THERE HAVE BEEN RESTORED TO THE TREASURY THE AMOUNTS OF TEMPORARY UNEMPLOYMENT COMPENSATION PAID IN THE STATE UNDER THIS ACT (EXCEPT AMOUNTS PAID TO INDIVIDUALS WHO EXHAUSTED THEIR UNEMPLOYMENT COMPENSATION UNDER TITLE XV OF THE SOCIAL SECURITY ACT AND TITLE IV OF THE VETERANS' READJUSTMENT ASSISTANCE ACT OF 1952 PRIOR TO THEIR MAKING THEIR FIRST CLAIMS UNDER THIS ACT), THE AMOUNT OF COSTS INCURRED IN THE ADMINISTRATION OF THIS ACT WITH RESPECT TO THE STATE, AND THE AMOUNT ESTIMATED BY THE SECRETARY OF LABOR AS THE STATE'S PROPORTIONATE SHARE OF OTHER COSTS INCURRED IN THE ADMINISTRATION OF THIS ACT.'

AS INDICATED IN YOUR LETTER, WHETHER EXPENSES INCURRED BY THE DEPARTMENT OF THE TREASURY IN ADMINISTERING THE TEMPORARY UNEMPLOYMENT COMPENSATION ACT OF 1958 ARE RECOVERABLE UNDER SECTION 104 (A) OF THE ACT WOULD APPEAR TO DEPEND ON WHETHER SUCH EXPENSES MAY BE CONSIDERED "OTHER OSTS" WITHIN THE MEANING OF THAT PHRASE AS USED THEREIN.

THE TWO CATEGORIES OF ADMINISTRATIVE COSTS (AS DISTINGUISHED FROM AMOUNTS OF TEMPORARY UNEMPLOYMENT COMPENSATION) SPECIFICALLY REFERRED TO IN SECTION 104 (A) AND RECOVERABLE FROM THE STATES THEREUNDER ARE (1) "THE AMOUNT OF COSTS INCURRED IN THE ADMINISTRATION OF THIS ACT WITH RESPECT TO THE STATE," AND (2) "THE AMOUNT ESTIMATED BY THE SECRETARY OF LABOR AS THE STATE'S PROPORTIONATE SHARE OF OTHER COSTS INCURRED IN THE ADMINISTRATION OF THIS ACT.' AS INDICATED IN YOUR LETTER THE TERM "OTHER COSTS" AS USED IN SECTION 104 (A) APPARENTLY IS INTENDED TO DESCRIBE ALL FEDERAL COSTS INCURRED IN ADMINISTERING THE ACT WHICH ARE NOT ATTRIBUTABLE TO ANY PARTICULAR STATE. IN ANY EVENT THE TERM IS NOT LIMITED AND IS BROAD ENOUGH TO ENCOMPASS ANY FEDERAL ADMINISTRATIVE COSTS NOT INCURRED WITH RESPECT TO A PARTICULAR STATE. THUS IT WOULD APPEAR TO ENCOMPASS COSTS INCURRED BY THE DEPARTMENT OF THE TREASURY UNDER THE ACT.

FURTHER, THE LEGISLATIVE HISTORY OF H.R. 12065, WHICH BECAME THE TEMPORARY UNEMPLOYMENT COMPENSATION ACT OF 1958, DISCLOSES THAT THE BILL AS ORIGINALLY REPORTED OUT BY THE HOUSE COMMITTEE ON WAYS AND MEANS DID NOT CONTAIN A REPAYMENT PROVISION SUCH AS SECTION 104 (A). SECTION 104 (A) WAS ONE OF THE PROVISIONS OF AN AMENDMENT IN THE NATURE OF A SUBSTITUTE OFFERED BY MR. HERLONG, WHICH STRUCK OUT EVERYTHING AFTER THE ENACTING CLAUSE OF H.R. 12065. THE PROPOSED AMENDMENT IN THE NATURE OF A SUBSTITUTE WAS SUBSEQUENTLY ENACTED INTO LAW. APPARENTLY THE PURPOSE OF THE REPAYMENT PROVISION (SECTION 104 (A) ( WAS TO INSURE THAT FEDERAL FUNDS EXPENDED UNDER THE ACT (EXCEPT THOSE AMOUNTS SPECIFICALLY EXCEPTED BY SECTION 104 (A) ( INCLUDING FUNDS EXPENDED FOR ADMINISTRATIVE COSTS WOULD BE RECOVERED FROM THE PARTICIPATING STATES. NOTE IN CONNECTION WITH THE REPAYMENT PROVISION THE COMPARISON OF PROVISIONS OF H.R. 12065 AS ORIGINALLY REPORTED OUT BY THE HOUSE COMMITTEE WITH THE PROVISIONS OF THE AMENDMENT THERETO OFFERED BY MR. HERLONG, PAGE 7106, CONGRESSIONAL RECORD (TEMPORARY EDITION), MAY 1, 1958, AND NOTE STATEMENT ON PAGE 8562 THEREOF.

IN VIEW OF THE FOREGOING, YOU ARE ADVISED THAT EXPENSES INCURRED BY THE DEPARTMENT OF THE TREASURY IN ADMINISTERING THE TEMPORARY UNEMPLOYMENT COMPENSATION ACT OF 1958 ARE RECOVERABLE UNDER SECTION 104 (A) THEREOF.