Trade Adjustment Assistance for Workers (TAA) and Alternative Trade Adjustment Assistance for Older Workers (ATAA)

^Pr^ep^ar^{ed f}^o^r^M^e^m^b^ers^an^d^Com^mⁱ^t^t^ees^of^C^ong^r^e^ss

Trade Adjustment Assistance for Workers (TAA) provides assistance to qualifying workers who
lose their jobs directly due to increased imports or shifts in production out of the United States.
Certified workers whose unemployment compensation has ended and who are in approved
training may receive Trade Readjustment Allowances (TRA) for a maximum of 130 weeks. Some
workers age 50 or older are eligible to receive Alternative Trade Adjustment Assistance for Older
Workers (ATAA), a wage supplement in lieu of training and TRA benefits. Both TAA- and
ATAA-eligible workers can receive a Health Coverage Tax Credit (HCTC), which provides a
refundable tax credit to offset 65% of the health insurance premiums of TAA- and ATAA-eligible
workers. This report provides background on the programs, including a description of the
eligibility for these programs and benefits available to participants. A separate report considers ^th
reauthorization issues and describes related legislation in the 110 Congress. This report will be
updated as legislative activity warrants.

Backgr ound ............................................................................................................................... 1
Financing ................................................................................................................................... 1
Admi nistra ti on........................................................................................................................... 2
Trade Adjustment Assistance Benefits......................................................................................2
Income Support...................................................................................................................2
Training Assistance.............................................................................................................2
Job Search and Relocation Assistance................................................................................3
Alternative Trade Adjustment Assistance Benefits...................................................................3
Health Coverage Tax Credit (HCTC) Benefit...........................................................................3
Eligibility .................................................................................................................................. 3
TAA Group Eligibility........................................................................................................3
TAA Individual Eligibility..................................................................................................4
ATAA Group Eligibility......................................................................................................4
ATAA Individual Eligibility................................................................................................5
Participation .............................................................................................................................. 5
Table 1. Petitions and Certifications, FY2001-FY2007..................................................................5
Table 2. Selected Statistics on TAA Benefits, FY2001-FY2006.....................................................6
Author Contact Information............................................................................................................6

Trade Adjustment Assistance for Workers (TAA) provides extended income support as well as ¹
training, job search, and relocation benefits. To be eligible for TAA, workers must have become
unemployed for one of three reasons: (1) their jobs moved to a country with which the U.S. has a ²
free trade agreement or to certain other countries; (2) their job losses can be attributed to
increased imports (from any country) that contributed importantly to an actual decline in sales or
production; or (3) their job losses resulted from the loss of business with a primary firm because
of a trade-related reason. Older TAA-eligible workers may be able to opt for Alternative Trade
Adjustment Assistance (ATAA), which provides a wage supplement in lieu of TAA benefits. In
addition, workers can claim a refundable Health Coverage Tax Credit (HCTC). The HCTC was ³
established to help both eligible TAA and ATAA workers pay for health insurance.
TAA was formally established by the Trade Expansion Act of 1962 (P.L. 87-794) but was little
used until the Trade Act of 1974 (P.L. 93-618) expanded benefits and eligibility. Most recently,
the Trade Act of 2002 (P.L. 107-210) established ATAA and reauthorized and expanded TAA.
TAA and ATAA were set to expire December 31, 2007. The House passed a three-month
extension (H.R. 4341) by a voice vote. However, as of February 25, 2008, the Senate has not
acted on the measure. The Consolidated Appropriations Act, 2008 (P.L. 110-161, signed by
President George W. Bush on December 26, 2007) contained an appropriation for the TAA for ⁴
Workers and ATAA programs that fully funded the programs for FY2008. The Consolidated
Security, Disaster Assistance, and Continuing Appropriations Act, 2009 (P.L. 110-329) fully funds
the TAA and ATAA programs through March 6, 2009, and specifies that the programs will
continue through this date.
TAA financing has several components. TRA funds for extended unemployment benefits are
appropriated as an entitlement out of the general fund (not out of the Unemployment Trust Fund).
TRA benefits are provided to all workers who meet eligibility requirements. In FY2007, $572
million was appropriated for TRA benefits. Funds for training, job search and relocation
expenses, and administrative costs are a line item appropriation of which training is a capped
entitlement ($220 million in FY2007). In FY2007, $6.6 million was appropriated for job search
and relocation benefits. The ATAA is appropriated as an entitlement out of the general fund. In
FY2007, $23.5 million was appropriated for ATAA. The HCTC is funded out of general revenue.

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At the federal level, the TAA and ATAA programs are administered by the Employment and
Training Administration (ETA) within the U.S. Department of Labor (DOL). Claims for benefits
by individual workers are administered by the state Unemployment Compensation (UC) agencies
under agreements and contracts with DOL. The use of funds varies greatly from year to year and
from state to state.
TAA benefits, which are primarily focused on the re-employment of certified workers, have
several components: up to 130 weeks of income support while in training, training assistance, and
job search and relocation assistance.
Workers have both basic and additional TRA available to them.
• Basic TRA. Workers receive basic TRA after their UC benefits are exhausted.
The weekly TRA payment is equal to the worker’s most recent UC benefit. The
total amount of basic TRA benefits available to a worker is equal to 52 times the
weekly TRA benefit minus the total amount of UC benefits. For example, a
worker who receives 39 weeks of UC would be eligible to receive an additional
13 weeks of basic TRA. To receive the basic TRA benefit, workers must be
enrolled or participating in TAA training, have completed such training, or have ⁵
obtained a waiver of the training requirement.
• Additional TRA. An additional 52 weeks of income support is available for
workers in approved training programs, plus another 26 weeks are available for
workers in remedial training programs.
Workers’ training assistance is for full-time participation in an approved training program.
Approved training programs include, but are not limited to, employer-based training, including
customized training and on-the-job training; any training program provided by a state pursuant to
Title I of the Workforce Investment Act of 1998 (WIA, P.L. 105-220); any training program
approved by a private industry council under Section 102 of WIA; or any training program for
which all, or any portion, of the costs are paid (1) under a federal or state program or (2) from any
other source. According to DOL, between July 2006 and June 2007 the average number of weeks
of training per participant was 63, and 72% of participants completed training.

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Certified workers who cannot obtain suitable employment within their commuting areas can
receive an allowance of 90% of their job search and relocation expenses, up to a maximum of
$1,250 for each benefit. Less than 1% of TAA-eligible workers receive these benefits.
• Job Search Allowance. Applications must be submitted before a job search ^th
begins and made by the 365 day after certification or final separation
(whichever is later) or within 182 days of the end of training.
• Relocation Expenses. Applications must be submitted before the relocation
occurs and made within 425 days of certification or layoff (whichever is later) or
within 182 days of the end of training. The relocation must occur within 182 days
of filing the application for relocation assistance or within 182 days after the
conclusion of training.
Workers who qualify for the ATAA benefit can receive a wage supplement worth half the
difference in salary between their old and new jobs for a maximum of $10,000 over two years.
Although workers are ineligible if their wages are more than $50,000 a year, their combined
wages and ATAA payments can exceed $50,000 a year. For example, a worker who earned
$55,000 at a previous job and earns $48,000 at a new job would be eligible for a benefit of $7,000
over two years. In this case, the worker would receive a total of $51,500 per year in wages and
ATAA benefits.
The Health Coverage Tax Credit (HCTC) is available to TAA and ATAA workers. The HCTC
covers 65% of the premium for qualified health insurance purchased by an eligible taxpayer (the
taxpayer is responsible for the other 35%). It is refundable, so workers may claim the full credit
even if they have little or no federal income tax liability. The credit may also be advanced, so
taxpayers have the option of using the credit on a monthly basis when premiums are due rather
than waiting until the end of the year. Individuals may receive the HCTC for one month longer
than their TAA eligibility or exactly two years in the case of their ATAA eligibility.
Obtaining TAA or ATAA benefits is a two-stage process: (1) a group of workers must petition
DOL to become TAA certified, and they also may apply for ATAA certification; and (2)
individual workers apply for TAA or ATAA benefits at a local One-Stop Career Center.
To gain TAA eligibility, a group of three or more workers (or their union, firm, or state) petitions
DOL. Then, DOL investigates whether import competition “contributed importantly” to the
group’s job loss or whether their firm has shifted production of like articles to certain countries.
TAA also extends eligibility to groups of secondary workers whose job losses result from the loss
of business with a primary firm (i.e., the firm that directly lost business or outsourced as a result

of trade). The Trade Act requires that the workers’ firm produce an “article.” In determining
whether a firm produces an article, DOL relies, in part, on the Harmonized Tariff Schedule of the
United States, published by the United States International Trade Commission, which describes ⁶
all articles imported to or exported from the United States.
Certification of the petition requires that:
• a significant number of workers⁷ are laid off or threatened with layoffs,
• the sales or production of the firm decreased, and
• increased imports have “contributed importantly” to these declines.
The determination on a TAA petition must be made by DOL within 40 days of filing. Generally,
the certification covers all members of the worker group who are laid off during the three-year
period beginning one year before the petition was filed (the impact date) and ending two years
after the date of the certification. Determinations on TAA and ATAA petitions are published in the
Federal Register. Workers who are denied certification may request administrative
reconsideration by DOL. Reconsideration requests must be mailed within 30 days of Federal
Register publication. Workers who are denied certification may seek judicial review of DOL’s
initial petition denial or denial following administrative reconsideration. Appeals for judicial
review must be filed with U.S. Court of International Trade within 60 days of Federal Register
publication of the initial denial or administrative reconsideration denial.
If DOL certifies a petitioner’s group of workers as eligible, the individual workers then apply to
their state agency to establish a TAA benefit claim. For an individual worker, eligibility is based
on (1) separation from the firm on or after the impact date specified in the certification but within
two years of DOL certification; (2) employment with the affected firm in at least 26 of the 52
weeks preceding layoff; (3) entitlement to state UC benefits; (4) no disqualification for extended
unemployment benefits; and (5) enrollment or a waiver for participation in an approved training
program. Certified workers who are denied individual benefits can appeal the decision. The
determination notice that certified workers receive after filing their applications for each benefit
will explain their appeal rights and time limits for filing appeals.
If a group of workers also wants ATAA eligibility, they must apply concurrently with TAA
certification and meet the following criteria:
• a significant number of the affected workers are 50 years or older,
• the petitioning workers’ skills are not easily transferable, and
• the workers’ industry experienced adverse competitive conditions.

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^tota^{l w}^o^rk^e^r^{s if}^the^fⁱ^r^m^ha^{d 50 or}^m^o^re^w^o^rk^e^r^s.

If DOL certifies a group as ATAA eligible, then an individual worker must meet the following
requirements:
• be at least 50 years old at the time of reemployment and
• obtain full-time employment earning less than $50,000 per year within 26 weeks
of separation.
Table 1 includes data on TAA petitions and certifications for FY2001 to FY2007. Following the
reauthorization in 2002, there is an increase in petitions and certifications. The numbers do not
exhibit a particular trend over time because the number of petitions depends on the episodic ⁸
nature of layoffs, especially within a particular state.
Table 1. Petitions and Certifications, FY2001-FY2007
^Peti^{tions Fil}^ed^Peti^{tions Certified}
^Fiscal^Peti^tions^Estimated^{Number Percent}^Estimated
^Year^Workers^Workers
²⁰⁰^{1 2,35}³^308,²⁵³^1,02⁹^43%^139,⁵⁸⁷
²⁰⁰^{2 2,40}⁵^265,⁷⁵⁷^1,59⁴^66%^235,⁰⁷²
²⁰⁰^{3 3,56}⁷^292,⁸²⁷^1,88⁰^53%^197,³⁵⁹
²⁰⁰^{4 2,99}²^171,²⁸¹^1,80²^60%^149,⁷⁰⁵
²⁰⁰^{5 2,63}⁸^164,³⁷¹^1,53⁴^58%^118,⁰²²
²⁰⁰^{6 2,47}⁸^172,⁶⁵¹^1,42⁶^57%^119,⁶⁰²
²⁰⁰^{7 2,22}⁸^—^a^1,42⁷^64%^146,⁶⁰⁶
^Source:^{CRS Table from Educa}^{tion and Training Administration (}^{ETA) data.}
^a.^{The nu}^mber^{of estimated worker}^{s covered by}^{petitions filed in FY200}^{7 is}^{not available.}
Table 2 includes data on TAA benefits for FY2001 to FY2006. The increases from FY2002 to
FY2003 are due to reauthorization.

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Table 2. Selected Statistics on TAA Benefits, FY2001-FY2006
^{Trade Readjustment Allowa}^nce^{Training, Job}^{Search, Relo}^{cation Allowa}^nces
^Total
^Fiscal^New^Average^Weekly^Total^Outlays^Entered^Job^Re-^Outlays
^Year^Recipients^{Payment ($)}^($millions)^Training^Search^location^($
^millions⁾
²⁰⁰^{1 33,0}⁰⁰²²²²²⁶^24,0⁰⁰²⁴²³⁶⁹⁹⁴
²⁰⁰^{2 37,0}⁰⁰²³⁴¹⁹⁹^37,0⁰⁰²⁷⁹³⁹³⁹⁵
²⁰⁰^{3 44,0}⁰⁰²⁴⁵³⁹⁸^44,0⁰⁰⁴³⁰⁷³⁶²⁵⁹
²⁰⁰^{4 81,0}⁰⁰²⁶⁴⁵⁶²^51,0⁰⁰⁴⁶⁷⁸¹⁷²⁵⁹
²⁰⁰^{5 55,0}⁰⁰²⁷⁷⁶⁴⁶^38,0⁰⁰²⁸⁸⁴⁴⁶²⁵⁹
²⁰⁰^{6 60,0}⁰⁰²⁹³⁵⁴⁹^37,0⁰⁰⁴⁵⁴⁵³¹²⁵⁹
^Source:^{Table provided to CRS by U.S. Department of La}^{bor, Em}^{ployment and Training Administr}^{ation, on}
^August^{10, 2}⁰⁰^{7. Reauthorization and ex}^{pansion of TAA eligibility}^{occurred in FY2}⁰⁰^3.
ATAA data are difficult to find in part because demographic data are collected only after a
participant has completed the program. Since the first participants were eligible to receive up to
six months of unemployment compensation and then up to two years of ATAA benefits, data on
the first participants were first reported by states in 2006. According to DOL data received by
CRS on March 2, 2007, in calendar year 2003, there were 1,403 new recipients. This increased to

2,349 and 3,028 in 2004 and 2005, respectively.

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