Initial Implementation of the Trade Act of 2002

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Release Date

Initial Implementation of the Trade Act of 2002

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Issue
2009-14

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Description

The Trade Act of 2002 significantly amended the Trade Adjustment Assistance (TAA) program which provides extensive training and benefits to dislocated workers certified as trade-affected. The Act created a single program (repealing the North American Free Trade Agreement-TAA program), mandated that certification of workers’ petitions occur in 40 (down from 60) days by the U.S. Department of Labor, and instituted new deadlines for enrolling in training by 8 weeks after certification or 16 weeks after job separation. Among other changes, the law also opened eligibility to secondary workers, offered a tax credit to partially cover health insurance, created the Alternative TAA (ATAA) program to provide compensation to older participants who obtain lower-paid work but no training.

To understand the issues and challenges in implementing the Trade Act of 2002, site visits were conducted in May and June of 2004 in 12 state agencies (selected randomly proportionate to size of states’ TAA activity) and in 12 local offices. This report is part of a longer-term project to conduct a national net-impact evaluation of the Trade Adjustment Assistance (TAA) program.

Key findings from the visits include the following: 1) the shorter period for determinations of petitions was much appreciated by states and allowed for earlier reemployment services; 2) nearly all state and local respondents said that the 8/16 week deadlines were one of the biggest challenges of the Act, since these deadlines did not provide enough time for a customer to be enrolled in a suitable training program; 3) there was a high degree of variation as to the nature and amount of services offered to and received by TAA participants, determined primarily by the degree to which services were coordinated with other One-Stop programs and participants were co-enrolled with WIA dislocated worker program, 4) many local areas reported that they did not regularly co-enroll TAA customers in WIA, 5) implementing the ATAA program was challenging and time-consuming, and take-up was extremely low; 6) implementing the health care credit was also very challenging, in part because the need to issue blanket training waivers to virtually all trade-affected workers to protect their HCTC eligibility, 7) take-up rate for the credit was low primarily because the cost of covering 35 percent of health insurance premiums was too high to be affordable for most trade-affected workers, and 8) other changes, such as the extension of additional TRA benefits, its allowance for remedial training, and the extension of allowable breaks of training were all strongly welcomed by administrators.