Bill Text: HI SB2732 | 2010 | Regular Session | Introduced

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Bill Title: Unemployment Insurance; Tax

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2010-01-27 - (S) Referred to LBR, WAM. [SB2732 Detail]

Download: Hawaii-2010-SB2732-Introduced.html

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THE SENATE	S.B. NO.	2732
TWENTY-FIFTH LEGISLATURE, 2010
STATE OF HAWAII

A BILL FOR AN ACT

 

 

RELATING TO EMPLOYMENT SECURITY LAW.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  Section 383-61, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

     "(c) For the calendar year 1991 only, the term "wages" does not include remuneration in excess of $7,000 paid with respect to employment to an individual by an employer.  For calendar years 2008[,] and 2009[, and 2010] only, the term "wages" as used in this part does not include remuneration in excess of $13,000 paid with respect to employment to an individual by an employer so long as the balance of the unemployment trust fund does not fall below the adequate reserve fund as specified by section 383-63.  For calendar year 2010 only, the term "wages" as used in this part does not include remuneration paid with respect to employment to an individual by an employer which exceeds 70 per cent of the average annual wage."  For calendar year 2011, and every year thereafter the term "wages" as used in this part does not include remuneration paid with respect to employment to an individual by an employer which exceeds 80 per cent of the average annual wage.

     SECTION 2.  Section 383-63, Hawaii Revised Statutes, is amended by amending the definition of "adequate reserve fund" to read as follows:

     ""Adequate reserve fund" means an amount that is equal to the amount derived by multiplying the benefit cost rate that is the highest during the ten-year period ending on November 30 of each year by the total remuneration paid by all employers, with respect to all employment for which contributions are payable during the last four calendar quarters ending on June 30 of the same year, as reported on contribution reports filed on or before October 31 of the same year.  "Remuneration", as used in this definition, means wages as defined in section 383-10.  For the purpose of determining the highest benefit cost rate, the benefit cost rate for the first twelve-consecutive-calendar-month period beginning with the first day of the first month of the ten –year period and for each succeeding twelve-consecutive-calendar-month period beginning with the first day of each subsequent month shall be computed.

     Effective for the calendar years 1992 through 2007, [and from calendar year 2011 and thereafter,] "adequate reserve fund" means an amount that is equal to one and one-half times the amount derived by multiplying the benefit cost rate that is the highest during the ten-year period ending on November 30 of each year by the total remuneration paid by all employers, with respect to all employment for which contributions are payable during the last four calendar quarters ending on June 30 of the same year, as reported on contribution reports filed on or before October 31 of the same year.  "Remuneration", as used in this definition, means wages as defined in section 383-10.  For the purpose of determining the highest benefit cost rate, the benefit cost rate for the first twelve-consecutive-calendar-month period beginning with the first day of the first month of the ten-year period and for each succeeding twelve-consecutive-calendar-month period beginning with the first day of each subsequent month shall be computed."

     SECTION 3.  Section 383-68, Hawaii Revised Statutes, is amended to read as follows:

     "§383-68  Contribution rate schedules; fund solvency rate schedule; rates based on experience.  (a)  Before December 31 of each year the fund solvency contribution rate applicable for the following calendar year shall be determined on the basis of the relationship between the most recent current reserve fund and the most recent adequate reserve fund.  The fund solvency contribution rate shall apply for calendar years 1985 through 1991 and shall be that rate that appears on the same line as the ratio (rounded to the nearest hundredth) of the current reserve fund to the adequate reserve fund in the fund solvency contribution rate schedule set forth in this paragraph.

FUND SOLVENCY CONTRIBUTION RATE SCHEDULE

     Ratio of Current Reserve Fund           Fund Solvency

       to Adequate Reserve Fund           Contribution Rate

            2.00 or more                     -.5 per cent

            1.50 to 1.99                     -.2 per cent

            1.00 to 1.49                                0

             .90 to  .99                    + .4 per cent

             .80 to  .89                    + .8 per cent

             .60 to  .79                    +1.2 per cent

             .40 to  .59                    +1.6 per cent

             .20 to  .39                    +2.0 per cent

           Less than .20                    +2.4 per cent

     (b)  For calendar years 1985 through 1991 the contribution rate of any employer eligible for a reduced rate in accordance with section 383-66(2) shall be the sum of the employer's basic contribution rate for such year determined pursuant to this subsection and the fund solvency contribution rate determined for such year pursuant to subsection (a); except that no employer's contribution rate shall be less than zero, no employer's contribution rate shall be greater than five and four-tenths per cent, and no employer with a negative reserve ratio shall have a contribution rate less than that employer's basic contribution rate.

     Subject to the requirements of sections 383-63 to 383-67 and 383-69, an employer's basic contribution rate for a calendar year shall be that rate which appears on the same line as the employer's reserve ratio for the year in the basic contribution rate schedule set forth in this subsection.

BASIC CONTRIBUTION RATE SCHEDULE

              Reserve Ratio          Contribution Rate

              .1500 and over          .2 per cent

              .1400 to  .1499         .4 per cent

              .1300 to  .1399         .6 per cent

              .1200 to  .1299         .8 per cent

              .1100 to  .1199         1.0 per cent

              .1000 to  .1099         1.2 per cent

              .0900 to  .0999         1.4 per cent

              .0800 to  .0899         1.6 per cent

              .0700 to  .0799         1.8 per cent

              .0600 to  .0699         2.2 per cent

              .0500 to  .0599         2.6 per cent

              .0300 to  .0499         3.0 per cent

              .0000 to  .0299         3.6 per cent

             -.0000 to -.0499         4.2 per cent

             -.0500 to -.0999         4.8 per cent

             -.1000 and less          5.4 per cent

     (c)  Effective with calendar year 1992 and thereafter, before December 31 of the previous year the contribution rate schedule for the following calendar year shall be determined on the basis of the relationship between the most recent current reserve fund and the most recent adequate reserve fund, in accordance with this subsection and subsection (d)[.] except as provided in subsection (e).

     (1)  Whenever the ratio of the current reserve fund to the adequate reserve fund is greater than 1.69, contribution rate schedule A shall apply.

     (2)  Whenever the ratio of the current reserve fund to the adequate reserve fund is 1.3 to 1.69, contribution rate schedule B shall apply.

     (3)  Whenever the ratio of the current reserve fund to the adequate reserve fund is 1.0 to 1.29, contribution rate schedule C shall apply.

     (4)  Whenever the ratio of the current reserve fund to the adequate reserve fund is .80 to .99, contribution rate schedule D shall apply.

     (5)  Whenever the ratio of the current reserve fund to the adequate reserve fund is .60 to .79, contribution rate schedule E shall apply.

     (6)  Whenever the ratio of the current reserve fund to the adequate reserve fund is .40 to .59, contribution rate schedule F shall apply.

     (7)  Whenever the ratio of the current reserve fund to the adequate reserve fund is .20 to .39, contribution rate schedule G shall apply.

     (8)  Whenever the ratio of the current reserve fund to the adequate reserve fund is less than .20, contribution rate schedule H shall apply.

     (d)  Subject to the requirements of section 383-63 to 383-69, an employer's contribution rate for calendar year 1992 and for each calendar year thereafter shall be that rate which appears on the same line as the employer's reserve ratio for that year in the contribution rate schedule applicable for the year as specified in subsection (c).

CONTRIBUTION RATE SCHEDULES (rates in percentages)

  Reserve Ratio     A   B   C   D   E   F   G   H

  .1500 and over    0.0  0.0  0.0  0.2  0.6  1.2  1.8  2.4

  .1400 to   .1499  0.0  0.0  0.1  0.4  0.8  1.4  2.0  2.6

  .1300 to   .1399  0.0  0.0  0.2  0.6  1.0  1.6  2.2  2.8

  .1200 to   .1299  0.0  0.1  0.4  0.8  1.2  1.8  2.4  3.0

  .1100 to   .1199  0.0  0.2  0.6  1.0  1.4  2.0  2.6  3.2

  .1000 to   .1099  0.1  0.3  0.8  1.2  1.6  2.2  2.8  3.4

  .0900 to   .0999  0.3  0.5  1.0  1.4  1.8  2.4  3.0  3.6

  .0800 to   .0899  0.5  0.7  1.2  1.6  2.0  2.6  3.2  3.8

  .0700 to   .0799  0.7  0.9  1.4  1.8  2.2  2.8  3.4  4.0

  .0600 to   .0699  0.9  1.1  1.6  2.0  2.4  3.0  3.6  4.2

  .0500 to   .0599  1.1  1.3  1.8  2.2  2.6  3.2  3.8  4.4

  .0300 to   .0499  1.3  1.5  2.0  2.6  3.0  3.6  4.2  4.8

  .0000 to   .0299  1.7  1.9  2.4  3.0  3.4  4.0  4.6  5.2

 -.0000 to  -.0499  2.1  2.3  2.8  3.4  3.8  4.4  5.0  5.4

 -.0500 to  -.0999  2.5  2.7  3.2  4.0  4.4  5.0  5.4  5.4

 -.1000 to  -.4999 2.9  3.1  3.6  4.6  5.0  5.4  5.4  5.4

 -.5000 to  -.9999  3.4  3.6  4.2  5.2  5.4  5.4  5.4  5.4

-1.0000 to -1.4999  4.1  4.2  4.8  5.4  5.4  5.4  5.4  5.4

-1.5000 to -1.9999  4.7  4.8  5.4  5.4  5.4  5.4  5.4  5.4

-2.0000 and less    5.4  5.4  5.4  5.4  5.4  5.4  5.4  5.4

     (e)  Notwithstanding any other provisions of this section to the contrary, the contribution rate schedule for calendar years 2010, 2011, 2012, and 2013 only shall be determined as follows:

     (1)  the contribution rate schedule for calendar year 2010 shall be the contribution rate schedule as determined under this section or schedule E, whichever is lower; and

     (2)  the contribution rate schedule for calendar year 2011 shall be the contribution rate schedule as determined under this section or schedule E, whichever is lower.

     (3)  the contribution rate schedule for calendar year 2012 shall be the contribution rate schedule as determined under this section or schedule F, whichever is lower.

     (4)  the contribution rate schedule for calendar year 2013 shall be the contribution rate schedule as determined under this section or schedule F, whichever is lower."

     SECTION 4.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 5.  This Act shall take effect upon approval.

 

INTRODUCED BY:	_____________________________
	By Request

 

 

Report Title:

Unemployment Insurance; Tax

 

Description:

Amends the employment security law to reduce the unemployment insurance tax burden on employers.

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.