[Code of Federal Regulations]
[Title 20, Volume 3]
[Revised as of April 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 20CFR606.22]

[Page 36-37]
 
                      TITLE 20--EMPLOYEES' BENEFITS
 
 CHAPTER V--EMPLOYMENT AND TRAINING ADMINISTRATION, DEPARTMENT OF LABOR
 
PART 606--TAX CREDITS UNDER THE FEDERAL UNEMPLOYMENT TAX ACT; ADVANCES UNDER TITLE XII OF THE SOCIAL SECURITY ACT--Table of Contents
 
               Subpart C--Relief from Tax Credit Reduction
 
Sec. 606.22  Application for cap.

    (a) Application. (1) The Governor of the State shall make 
application, addressed to the Secretary of Labor, no later than July 1 
of a taxable year with respect to which a State requests a cap on tax 
credit reduction. The Governor is required to notify the Department on 
or before October 15 of such taxable year of any action occurring after 
the date of the initial application and effective prior to October 1 of 
such year that would impact upon the State's application.
    (2) The UIS Director will make a determination on the application on 
or before November 10 of such taxable year, will notify the applicant 
and the Secretary of the Treasury of such determination, and will cause 
notice of such determination to be published in the Federal Register.
    (b) Anticipated impact statement. In support of the application by 
the Governor, there shall be submitted with the application (on or 
before October 15), for the purposes of the criteria described in 
Secs. 606.20(a) (1) and (2) and 606.21 (a) and (b), a description of all 
statutory provisions enacted or amended, regulations adopted or revised, 
administrative policies and procedures adopted or revised, and judicial 
decisions given effect, which are effective during the 12-month period 
ending on September 30 of the taxable year for

[[Page 37]]

which a cap on tax credit reduction is requested, and an anticipated 
impact statement (AIS) for each such program action in the following 
respect--
    (1) The estimated dollar effect on each program action upon 
expenditures for compensation from the State unemployment fund and for 
the amounts of contributions paid or payable in such 12-month period, 
including the effect of interaction among program actions, and with 
respect to program actions for which dollar impact cannot be estimated 
or is minor or negligible, indicate whether the impact is positive or 
negative;
    (2) If a program action has no such dollar effect, an explanation of 
why there is or will be no such effect;
    (3) A description of assumptions and methodology used and the basis 
for the financial estimate of the impact of each program action 
described in paragraphs (b)(1) and (b)(2) of this section; and
    (4) A comparision of the program actions described in paragraphs 
(b)(1) and (b)(2) of this section with the program actions prior to the 
Federal fiscal year (as defined in Sec. 606.3(f)) which ends on such 
September 30.
    (c) Unemployment tax rate. With respect to the unemployment tax rate 
criterion described in Secs. 606.20(a)(3) and 606.21(c), the application 
shall include an estimate for the taxable year with respect to which a 
cap on tax credit reduction is requested and actual data for the prior 
two years as follows:
    (1) The amount of taxable wages as defined in Sec. 606.3(k);
    (2) The amount of total wages as defined in Sec. 606.3(l); and
    (3) The estimated distribution of taxable wages, as defined in 
Sec. 606.3(k), by tax rate under the State law.
    (d) Benefit cost ratio. With respect to the benefit cost ratio 
criterion described in Secs. 606.20(a)(3) and 606.21(d), the application 
shall include for each of the five calendar years prior to the taxable 
year for which a cap on tax credit reduction is requested, the following 
data:
    (1) The total dollar sum of compensation actually paid under the 
State law during the calendar year, including in such total sum all 
regular, additional, and extended compensation as defined in section 205 
of the Federal-State Extended Unemployment Compensation Act of 1970, but 
excluding from such total sum--
    (i) The total dollar amount of such compensation paid for which the 
State is entitled to reimbursement or was reimbursed under the 
provisions of any Federal law;
    (ii) The total dollar amount of such compensation paid which is 
attributable to services performed for a reimbursing employer, and which 
is not included in the total amount reported under paragraph (d)(1)(i) 
of this section;
    (2) The total dollar amount of interest paid during the calendar 
year on any advance; and
    (3) The total dollar amount of wages (as defined in Sec. 606.3(l)) 
with respect to such calendar year.
    (e) Documentation required. Copies of the sources of or authority 
for each program action described in paragraph (b) of this section shall 
be submitted with each application for a cap on tax credit reduction. In 
addition, a notation shall be made on each AIS of where all figures 
referred to are contained in reports required by the Department or in 
other data sources.
    (f) State contact person. The Department may request additional 
information or clarification of information submitted bearing upon an 
application for a cap on tax credit reduction. To expedite requests for 
such information, the name and telephone number of an appropriate State 
official shall be included in the application by the Governor.