Sec. 1. 26 MRSA §1221, sub-§4-A, ¶B, as amended by PL 1999, c. 740, §2, is further amended by repealing and replacing subparagraph (3) and inserting in its place the following:

(3)__The commissioner shall compute a reserve multiple to determine the schedule and planned yield in effect for a rate year.__The reserve multiple is determined by dividing the fund reserve ratio by the average benefit cost rate.__The determination date is October 31st of each calendar year.__For rate years commencing on or after January 1, 2002, the Department of Labor shall determine the planned yield and schedule needed to provide for a maximum of 14 months of benefits in the fund, based on the reserve multiple.__The department shall publish notice of the planned yield and schedule in a manner designed to notify employers of their obligations under this chapter.

Sec. 2. Department to submit legislation. The Department of Labor shall draft and submit legislation to change the method of calculating the planned yield for unemployment compensation contributions to a method designed to provide a maximum of 14 months of benefits in the Unemployment Compensation Fund. The department shall submit such legislation to the First Regular Session of the 120th Legislature no later than November 15, 2001.

SUMMARY

This bill changes the cap used to determine total employer contributions to the Unemployment Compensation Fund. Currently, the calculation used to determine the total contributions is designed to cap the fund at 18 months of benefits. This bill changes the cap to 14 months. It requires the Department of Labor to submit legislation to set forth the appropriate table for determining which schedule of contributions is used to determine individual employer contributions.