CORRECTED
SESSION OF 2021
SUPPLEMENTAL NOTE ON SENATE SUBSTITUTE FOR
SUBSTITUTE FOR HOUSE BILL NO. 2196
As Amended by Senate Committee of the Whole

Brief*
Senate Sub. for Sub. for HB 2196, as amended, would
create the Unemployment Compensation Modernization and
Improvement Council; require the Kansas Department of
Labor (KDOL) to modernize its information technology (IT)
infrastructure; make temporary changes to the membership of
the Employment Security Review Board; make changes to
Employment Security Rates tables; require the Secretary of
Labor to provide tax notifications and certain Employment
Security Fund Data Reporting; provide for certain employer
account protections; provide for transfers of federal
coronavirus relief aid or State General Fund moneys to the
Employment Security Fund; prohibit the continuation of
federal unemployment compensation programs using state
funds; adjust thresholds for maximum benefits; modify the
shared work program; and make other employment security
compensation changes. The bill also would make technical
changes.
The bill would be in effect upon publication in the
Kansas Register.


____________________
*Supplemental notes are prepared by the Legislative Research
Department and do not express legislative intent. The supplemental
note and fiscal note for this bill may be accessed on the Internet at
http://www.kslegislature.org
Unemployment Compensation Modernization and
Improvement Council
The bill would create the Unemployment Compensation
Modernization and Improvement Council (Council), which
would consist of 13 members.
Non-legislative members would be:
● Three representatives of employers, one each
selected by the Governor, the President of the
Senate, and the Speaker of the House;
● Three representatives of employees, one each
selected by the Governor, the President of the
Senate, and the Speaker of the House; and
● The Secretary of Labor or their designee with a
role in the administration of the Unemployment
Insurance (UI) system.
Non-legislative members would serve a term of the
shorter of three years or until the dissolution of the Council.
Legislative members would be as follows:
● As appointed by the President of the Senate:
○ One Senate member from the majority party;
and
○ The chairperson of the Senate committee to
which UI legislation is typically referred;
● As appointed by the Speaker of the House:
○ One House member from the majority party;
and
○ The chairperson of the House committee to
which UI legislation is typically referred;

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 ● One minority party Senate member, appointed by
the Senate Minority Leader; and
● One minority party House member, appointed by
the House Minority Leader.
Legislative members of the Council would serve during
the session in which they are appointed and could retain
membership while remaining members of the Legislature.
Council vacancies would be filled in the same way as
original appointments, to last for the remainder of the term of
the member being replaced. A member could also be
removed, reappointed, or substituted at any time by their
respective appointing authority. Members of the Council
would be entitled to compensation for service and for any
necessary expenses incurred, to be paid from the
Employment Security Administration Fund.
Operation of the Council
The bill would require the following to be part of the
operation of the Council:
● Members would be appointed within 30 days of the
effective date of the bill;
● The first meeting would be held within 30 days of
the effective date of the bill;
● The chairpersonship of the Council would alternate
at two-year intervals between the chairpersons of
the House and Senate standing committees to
which employment security legislation is typically
referred, beginning with the chairperson of the
House;
● The Speaker of the House and the President of the
Senate would jointly appoint an executive secretary

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 of the Council from the Kansas Legislative
Research Department to:
○ Plan and provide agendas for meetings and
conferences;
○ Record and make public the minutes;
○ Maintain confidential electronic and paper
records and ensure such information is
secure, organized, and easily accessible; and
○ Prepare research, reports, or presentations as
directed by the Council Chairperson; and
● The Council would be able to suggest to the
Secretary of Labor rules and regulations necessary
to carry out its function.
Role of the Council
The bill would require the Council to:
● Examine and recommend changes to the UI
system;
● Examine the claim-filing and benefit disbursement
process, and any future changes thereto;
● Examine and recommend changes on topics
including but not limited to:
○ Technological infrastructure;
○ Improvements to system responsiveness,
integrity, security, and data verification; and
○ Methods of information sharing;
● Conduct an audit of the UI system, with a
preliminary report by May 1, 2022, and a final
report by September 1, 2022:
○ Examining the effects of fraudulent claims and
improper payments from March 15, 2020,
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 through March 31, 2022, and the response by
KDOL to such claims;
○ Examining the amounts and nature of such
claims, fraud processes, and methods, and
the potential for recovery of fraudulent
payments;
○ Evaluating the likelihood of a data breach
contributing to fraud and improper network
architecture allowing a potential breach to
have occurred; and
○ Including information on the implementation of
all program integrity elements and guidance
issued by the U.S. Department of Labor and
the National Association of State Workforce
Agencies [Note: This requirement would be
ongoing for all subsequent reports.];
● Issue an initial report within 30 days of the
Council’s first meeting describing the state of the
process by which individuals file UI claims and
receive UI benefits; and
● In coordination with the Secretary of Labor:
○ Develop a strategic staffing plan to address
substantial changes in numbers of claims,
including the prospective use and sources of
additional employees;
○ Publish all points of contact for UI inquiries or
claims to KDOL’s website;
○ Recommend for adoption rules and
regulations for creating a uniform UI complaint
submission process; and
○ Adopt and periodically review a definition of
“substantial disruption” in the benefit
application and determination process.


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 The Secretary of Labor would have additional
responsibilities related to the Council:
● Post all materials from Council meetings on a
public website maintained by the Secretary;
● Develop the initial written strategic staffing plan,
review it annually, and revise it as necessary. After
each review, the most recent version would be
provided to the Council and published on a public
website maintained by the Secretary;
● Notify the Council Chairperson of any unauthorized
third-party access or acquisition of records within
five days of becoming aware of such an event; and
● Notify the Council members of any substantial
disruption in the benefit application and
determination process.
The bill would also require the Secretary of Labor, or
their designee, to provide status reports on or before the 15th
day of each month and the last day of each month to the
Council. The report would be required to include, but not be
limited to, information regarding the timeline, progress,
budget, and overall status of the unemployment information
technology system upgrade. Once the upgrade is complete,
the report would include information on system performance
and process updates.
The Council would not be permitted to examine the
solvency of the Unemployment Compensation Fund (cf. KSA
2020 Supp. 44-710a).
The Council would dissolve and all provisions related to
the Council would be of no effect three years after the date of
its first meeting.


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KDOL Information Technology Modernization
As a supplement to the Employment Security Law, the
bill would establish as the intent of the Legislature that
KDOL’s IT system be continually developed, customized,
enhanced, and upgraded, in order to collect State
employment security taxes, process UI claims, and pay UI
benefits. To this end, the bill would require the Legislative
Coordinating Council (LCC) to establish a deadline for
completion of the new UI system.
The LCC would also be authorized the extend the
deadline for completion of the modernization project at any
time.
The information technology system, technology, and
platform would include, but not be limited to, components
specified and defined by the Council in consultation with the
Secretary of Labor.
The new system would also include, but not be limited
to, features and benefits as specified and defined by the
Council in consultation with the Secretary of Labor.
The Secretary of Labor would be required to implement
all program integrity elements as specified and defined by the
Council in consultation with the Secretary of Labor. The bill
would specifically direct the Secretary to implement elements
including, but not limited to, the following:
● Cross-matching of social security numbers with the
Social Security Administration;
● Checking new hire records against the National
Directory of New Hires;
● Verification of citizenship or immigration status
through the Systematic Alien Verification for
Entitlements program;

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 ● Comparison of applicant information with local,
state, and federal prison databases;
● Use of the following to detect duplicate claims:
○ Interstate Connection Network;
○ Interstate Benefits Cross-Match;
○ State Identification Inquiry State Claims and
Overpayment File; and
○ Interstate Benefits 8606 application for
overpayment recoveries for claims filed in
other states;
● Identification of IP addresses linked with multiple
claims or claims filed outside the United States;
and
● Use of data mining and analytics for fraud
detection and prevention.
The bill would require, should the Council become
inactive or dissolved and the new information technology
system modernization project is completed, the Secretary of
Labor to implement and utilize all program integrity elements
and guidance issued by both the U. S. Department of Labor
and the National Association of State Workforce Agencies
within 60 days of issuance of such guidance.
The bill would require the cross-checks described above
to be carried out for new and active UI claims on a scheduled
basis. Individual cases would be reviewed for any claimants
approved for benefits for whom changes of circumstances
affecting eligibility are identified.
The bill would authorize KDOL to execute a
memorandum of understanding with any state department,
agency, or agency division for information required to be
shared by the bill.

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 The Secretary of Labor would be required to adopt rules
and regulations to carry out the provisions of the bill within 12
months of the effective date of the bill and to provide an
annual status update and progress report to the Council.

Employment Security Board of Review Temporary
Changes
The bill would provide that from the effective date of the
bill to June 30, 2024, the Employment Security Board of
Review (Board), currently composed of three members, will
consist of six members, with no more than four of the
members belonging to the same political party rather than two
as in current law.
The bill would provide that the Board may sit in panels of
three members with no more than two members belonging to
the same political party, for the purpose of hearing and
deciding cases before the Board.
The bill would provide that a member’s appointment
specifically for the term of the effective date of the bill through
June 30, 2024, would not count as a term for purposes of the
prohibition currently preventing a Board member from serving
more than two consecutive terms.

Employment Security Rate Tables Changes
The bill would provide for new tables for solvency and
credit adjustments for the purpose of making solvency or
credit adjustments to maintain the Employment Security Fund
balance beginning in rate year 2022.
The bill would replace the current uniform solvency rate
adjustments to the standard rate schedule with six new
solvency rate schedules and six new credit rate schedules
providing for solvency and credit rating adjustments to be
made according the experience rating of employers.

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Tax Notification
The bill would require the Secretary of Labor to inform a
claimant of the federal and state tax consequences related to
UI benefits on the initial determination of benefits notice.
Explanations of the following would be required:
● KDOL income tax withholding agreement form K-
BEN 233, or a successor form;
● Tax withholding elections; and
● The tax withholding process and estimated weekly
and maximum withholding amounts.
Unemployment Trust Fund Data Reporting
The bill would require the Secretary of Labor to publish
certain certified data related to the UI Trust Fund on a publicly
accessible website maintained by the Secretary.
The bill would require the following information to be
maintained for the most recent 20 fiscal years, first published
within 120 days of the effective date of the bill, and, for each
fiscal year beginning in FY 2022, published on or before
December 1 following the end of such fiscal year:
● Distributions of taxable wages by experience factor
for each fiscal year, to include:
○ The rate group;
○ The reserve ratio lower limit;
○ The number of accounts;
○ Taxable wages; and
○ Summaries including the number of accounts
and FY taxable wages for active positive
eligible, active ineligible, and active negative
accounts;

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 ● The average high-cost benefit rate summary, to
include:
○ The average high-cost benefit rate in effect at
that time, and
○ The benefit cost rate for fiscal years used to
compute the average.
The Secretary of Labor would be required, for the three
years following the effective date of the bill, to annually
provide projections of the number and amount of UI claims,
the UI Trust Fund balance, and the amount of employer
premiums to be paid, to the House Committee on Commerce,
Labor and Economic Development and the Senate
Committee on Commerce.

Reemployment and Work Skills Training Services
Provisions
The bill would require the Secretary of Labor and the
Secretary of Commerce to jointly establish and implement
programs providing reemployment and work skills training
services to UI benefit recipients, to be known as “my
reemployment plan” program. The program would be
available to all claimants except for those in the shared work
program, trade readjustment assistance programs, or on
temporary layoff with a return-to-work date.
The bill would require the Secretary of Labor to provide
the names and contact information of claimants who have
received benefits for four continuous weeks to the Secretary
of Commerce. The Secretary of Commerce would then be
required to request the following documents and information
from such claimants:
● Resume;
● Work history;
● Skills list; and
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 ● Job search plan.
The Secretary of Labor would also be required to share
labor market information and current available job positions
with the Secretary of Commerce.
The bill would require the Secretary of Commerce to:
● Collaborate with the KANSASWORKS workforce
system to provide assistance, when requested, to
claimants;
● Match open job positions with claimants based