C.__An Indian tribe or tribal unit must be billed for the full amount of benefits attributable to service in the employ of the Indian tribe or tribal unit on the same schedule as other employing units that have elected to make payments in lieu of contributions.

D.__At the discretion of the commissioner, an Indian tribe that elects to become liable for payments in lieu of contributions shall, within 60 days after the effective date of its election:

(1)__Execute and file with the commissioner a surety bond approved by the commissioner; or

(2)__Deposit with the commissioner money or securities on the same basis as other employers with the same election option.

4.__Failure to make payments.__An Indian tribe that fails to make the required payment is subject to this subsection.

A.__An Indian tribe that fails to make the payments required by this chapter, including assessments of interest and penalty, within 90 days of receipt of the bill loses the option to make payments in lieu of contributions, as described in subsection 3, for the following tax year unless payment in full is received before contribution rates for the next tax year are computed.

B.__An Indian tribe that loses the option to make payments in lieu of contributions due to late payment or nonpayment, as described in paragraph A, regains the option if, after a period of one year, all contributions have been made on time and no contributions, payments in lieu of contributions for benefits paid, interest or penalties remain outstanding.

C.__Notwithstanding subsection 1, paragraph B, if the Indian tribe fails to make required payments, including assessments of interest and penalty, after all collection activities considered necessary by the commissioner have been exhausted, services performed for that Indian tribe are not considered employment for purposes of subsection 1, paragraph B.

D.__An Indian tribe that loses coverage due to paragraph C

may have services performed for that Indian tribe included as employment at the discretion of the commissioner, once all contributions, payments in lieu of contributions, interest and penalties have been paid.

5.__Notices to Indian tribes.__The commissioner shall provide notification in notices of payment and reporting delinquency to Indian tribes that failure to make full payment within the prescribed time frame:

A.__Will cause the Indian tribe to be liable for taxes under FUTA;

B.__Will cause the Indian tribe to lose the option to make payments in lieu of contributions; and

C.__Could cause services in the employ of the Indian tribe to be excepted from employment for purposes of obtaining benefits under the Employment Security Law.

6.__Notices to Federal Government.__If an Indian tribe fails to make payments required under this section, including assessments of interest and penalties, within 90 days of a final notice of delinquency, the commissioner shall notify immediately the United States Internal Revenue Service and the United States Department of Labor.

7.__Extended benefits.__Extended benefits paid that are attributable to service in the employ of an Indian tribe and not reimbursed by the Federal Government must be financed in their entirety by that Indian tribe.

SUMMARY

The "Consolidated Appropriations Act, 2001," P.L. 106-554 (12/21/2000), amended federal law to allow Indian tribes to exercise the same election provided to state and local governments as well as nonprofit organizations with regard to the Federal Unemployment Tax Act (FUTA). Under the Consolidated Appropriations Act, services performed in the employ of American Indian tribes are no longer subject to FUTA and must now be covered under state unemployment laws. Currently, Maine law covers these services for unemployment insurance purposes. However, Indian tribes are only permitted to meet their unemployment insurance obligations by payment of a contribution to the Unemployment Compensation Fund. This bill clarifies that Indian tribes would now be offered the contribution and direct reimbursement options as part of the Federal-State Unemployment Compensation Program, similar to municipalities, for example.