,i #aaith ,,congress #b;d ,session ,h4 ,r4 #ajjdd ,,in ,,the ,,house ,,of ,,representatives ,august #f1 #bjbf,mr4 ,casar 7for himself1 ,mrs4 ,foushee1 and ,ms4 ,jacobs7 introduced the following bill2 which was referred to the ,committee on ,education and ,workforce1 and in addition to the ,committee on ,ways and ,means1 for a period to be subsequently determined by the ,speaker1 in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned ,a ,,bill ,to impose a tax on artificial intelligence token usage and establish a ,work ,protection ,administration within the ,department of ,labor1 and for other purposes4 #a4 ,short title2 table of contents 7a7 ,short title ,this ,act may be cited as the ,,ai ,tax and ,work ,protection ,act4 7b7 ,table of contents ,the table of contents for this ,act is as follows3 ,sec4 #a4 ,short title2 table of contents4 ,title ,i--,imposition of tax on artificial intelligence token usage ,sec4 #aja4 ,imposition of tax on artificial intelligence token usage4 ,title ,,ii--,trust fund ,sec4 #bja4 ,establishment4 ,sec4 #bjb4 ,use of funds4 ,title ,,iii--,office of ,job ,creation at ,department of ,labor ,sec4 #cja4 ,establishment4 ,sec4 #cjb4 ,duties4 ,title ,,iv--,jobs program ,sec4 #dja4 ,establishment of grant program4 ,sec4 #djb4 ,use of funds4 ,sec4 #djc4 ,report4 ,sec4 #djd4 ,advisory committee4 ,sec4 #dje4 ,bureau of ,labor ,statistics duties4 ,sec4 #djf4 ,additional ,workforce ,innovation and ,opportunity ,act funding4 ,sec4 #djg4 ,definitions4 ,i ,imposition of tax on artificial intelligence token usage #aja4 ,imposition of tax on artificial intelligence token usage 7a7 ,chapter #cf of subtitle ,d of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new subchapter3 ,d ,artificial ,intelligence ,sec4 #ddia4 ,excise tax on foundation models4 #ddia4 ,excise tax on foundation models 7a7 ,in general ,there is hereby imposed a tax on each covered person for each taxable year equal to the applicable amount4 7b7 ,definitions ,for purposes of this section-- 7#a7 ,applicable amount ,the term applicable amount means the greater of-- 7,a7 the product of-- 7i7 the fair market value of the tokens processed by the taxpayer in covered transactions during the taxable year1 multiplied by 7ii7 the applicable token percentage1 or 7,b7 the product of-- 7i7 the sum of-- 7,i7 the value of all consideration received by the taxpayer in exchange for artificial intelligence services in covered transactions1 plus 7,,ii7 the fair market value of all covered transactions with a related party1 multiplied by 7ii7 the applicable transaction percentage4 7#b7 ,covered transaction 7,a7 ,in general ,the term covered transaction means-- 7i7 the provision of use or access to a foundation model to an unrelated party in the course of the trade or business of the taxpayer1 or 7ii7 the use of a foundation model by the taxpayer or a sale1 license1 or exchange of such use or access to a foundation model to a related party if such use enables or results in a reduction in the workforce of the taxpayer or of such related party4 7,b7 ,exclusion ,such term does not include any use1 sale or license of use1 or access to a foundation model for the purpose of research and development by any of the following entities3 7i7 ,a ,federal1 ,state1 or local government4 7ii7 ,an institution of higher education 7as such term is used in section #aja7;a7 of the ,higher ,education ,act of #aife74 7iii7 ,a ,federally ,funded ,research and ,development ,center 7as defined in section #b4aja of title #dh1 ,code of ,federal ,regulations or any successor regulation thereto74 7iv7 ,an organization that is described in section #eja7;c77#c7 and is exempt from taxation under section #eja7;a74 7#c7 ,applicable token percentage ,the term applicable token percentage means-- 7,a7 in the case of a taxable year with respect to which the applicable unemployment rate does not exceed #e percent1 #b percent1 7,b7 in the case of a taxable year with respect to which the applicable unemployment rate exceeds #e percent and does not exceed #g percent1 the sum of-- 7i7 #b percent1 plus 7ii7 the percentage by which such rate exceeds #e percent1 or 7,c7 in the case of a taxable year with respect to which the applicable unemployment rate exceeds #g percent1 the sum of-- 7i7 #b percent1 plus 7ii7 twice the percentage by which such rate exceeds #e percent4 7#d7 ,applicable transaction percentage ,the term applicable transaction percentage means-- 7,a7 in the case of a taxable year with respect to which the applicable unemployment rate does not exceed #e percent1 #c percent1 7,b7 in the case of a taxable year with respect to which the applicable unemployment rate exceeds #e percent and does not exceed #g percent1 the sum of-- 7i7 #c percent1 plus 7ii7 the percentage by which such rate exceeds #e percent1 or 7,c7 in the case of a taxable year with respect to which the applicable unemployment rate exceeds #g percent1 the sum of-- 7i7 #c percent1 plus 7ii7 twice the percentage by which such rate exceeds #e percent4 7#e7 ,applicable unemployment rate ,the term applicable unemployment rate means1 with respect to a covered transaction1 the ,u-#d defined measure as published in the monthly ,employment ,situation release by the ,bureau of ,labor ,statistics for the calendar year for which such measure was highest during the #c calendar years preceding the year in which such covered transaction occurs1 determined without regard to any calendar year which began before the date of the enactment of this section4 7#f7 ,covered person ,the term covered person means a person that-- 7,a7 develops a foundation model1 sells access to a foundation model1 or modifies an existing open-weight foundation model1 and 7,b7 generates revenue from a covered transaction or uses the foundation model to reduce the workforce of such person4 7#g7 ,foundation model ,the term foundation model means an artificial intelligence model-- 7,a7 is trained on broad data1 7,b7 generally uses self supervision1 7,c7 which is trained-- 7i7 using a quantity of computing power equal to or greater than #ajbe integer or floating-point operations1 or 7ii7 using such quantity of integer or floating-point operations as the ,secretary determines necessary to achieve comparable model capability for the calendar year1 and 7,d7 is applicable across a wide range of contexts4 7#h7 ,open-weight foundation model ,a foundation model the trained model parameters of which are made publicly available for others to download and use1 allowing developers and researchers to run1 fine-tune1 or adapt the model4 7#i7 ,artificial intelligence ,the term artificial intelligence has the meaning given such term in section #ejjb of the ,national ,artificial ,intelligence ,initiative ,act of #bjbj4 7#aj7 ,token ,the term token means a discrete unit of data1 such as text1 code1 image1 audio1 or video data1 that an artificial intelligence model processes1 used for the purpose of measuring the volume of model input or output4 7c7 ,suspension of higher rates ,upon a determination by the ,secretary may1 in consultation with the ,secretary of ,labor1 that an unemployment rate in excess of #e percent occurred by reason of a war1 pandemic1 or any other massive economic shock unrelated to the use of artificial intelligence1 the ,secretary may apply paragraphs 7#c7 and 7#d7 of subsection 7b7 without regard to so much of the unemployment rate as the ,secretary determines is the result of such unrelated cause4 7d7 ,related party ,for purposes of this section1 a person is a related party to another person if such sons are treated as a single employer under subsection 7a7 or 7b7 of section #eb or subsection 7m7 or 7o7 of section #dad4 7e7 ,regulations ,the ,secretary shall issue and annually revise such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section1 including determining1 in consultation ,secretary of ,commerce1 the fair market value of a token for purposes of subsection 7b77#a77;,a77i74 4 7b7 ,clerical amendment ,the table of subchapters for chapter #cf of subtitle ,d of such ,code is amended by inserting after the item relating to subchapter ,d the following new item3 ,subchapter ,d4 ,artificial ,intelligence 4 7c7 ,effective date ,the amendments made by this section shall apply to covered transactions 7as defined in section #ddia7;c7 of such ,code1 as added by this section7 which occur after the date which is #a year after the date of the enactment of this ,act4 ,,ii ,trust fund #bja4 ,establishment ,there is established in the ,treasury of the ,united ,states a trust fund consisting of such amounts 7to be appropriated out of any moneys in the ,treasury not otherwise appropriated7 equivalent to #ajj percent of the taxes imposed by section #ddia of the ,internal ,revenue ,code of #aihf for the fiscal year #bjbg1 and for each fiscal year thereafter4 #bjb4 ,use of funds ,such funds appropriated to the trust fund established under section #bja shall be used to carry out titles ,,iii and ,,iv4 ,,iii ,office of ,job ,creation at ,department of ,labor #cja4 ,establishment ,not later than #ij days after the date of the enactment of this ,act1 the ,secretary of ,labor shall establish a ,work ,protection ,administration 7in this ,act referred to as the ,,wpa7 within the ,department of ,labor1 to be headed by the ,director of the ,work ,protection ,administration4 #cjb4 ,duties ,the ,,wpa established under section #cja shall develop and implement a jobs program under title ,,iv to award grants to eligible entities4 ,,iv ,jobs program #dja4 ,establishment of grant program 7a7 ,in general ,subject to the availability of funds in the trust fund established under title ,,ii1 the ,director shall establish a grant program to award funds to eligible entities on a competitive basis to create employment opportunities for individuals under section #djb4 7b7 ,criteria for awarding grant funds 7#a7 ,priorities ,in awarding grants under this title1 the ,director shall-- 7,a7 give priority to eligible entities that plan to use such grant funds to create jobs to be filled by permanent and full-time employees2 and 7,b7 in the case of eligible entities that plan to use such grant funds for functions typically performed by ,state governments or units of general local government1 give priority to eligible entities that are ,state governments or units of general local government4 7#b7 ,additional criteria ,in awarding grants under this title1 the ,director shall take into consideration-- 7,a7 any recommendations of the advisory committee established in section #djd2 and 7,b7 any information1 including reports provided pursuant to section #dje1 from the ,bureau of ,labor ,statistics on the impacts of artificial intelligence on the labor market4 7c7 ,application ,to be eligible to receive a grant under this title1 an eligible entity shall submit to the ,director an application-- 7#a7 at such time1 in such manner1 and containing such information as the ,director may require2 and 7#b7 which shall include such assurances as may be necessary to ensure that such entity has the policies described in subsection 7e74 7d7 ,interagency task force ,the ,director shall establish an interagency task force to assist the ,director in reviewing any applications submitted under subsection 7c71 which shall include ,federal agencies selected by the ,director4 7e7 ,additional requirements for eligible entities ,to be eligible to receive a grant under this section1 an eligible entity shall be required to have each of the following policies with respect to any employee hired using grant funds awarded under this title3 7#a7 ,collective bargaining ,a collective bargaining agreement1 or written policy1 not to prevent employees from exercising the rights guaranteed to employees under section #g of the ,national ,labor ,relations ,act 7#bi ,u4,s4,c4 #aeg74 7#b7 ,notice requirement ,policies that require-- 7,a7 the posting and maintenance of notices that contain information regarding the rights of such employees under the ,national ,labor ,relations ,act 7#bi ,u4,s4,c4 #aea et seq47 in any workplace of an eligible entity in which employees described in section #djb7;c7 work2 7,b7 that such employees are provided with notice and information regarding the benefits and pay required for each job created under this ,act in section #djb7;d7 at the start of employment2 and 7,c7 such eligible entity to recognize the exclusive representative selected by the employees in the case that more than #ej percent of the employees indicate the desire to be represented by such exclusive representative4 7#c7 ,local hiring ,policies that provide a preference for hiring employees in the same metropolitan area as the site of employment1 as determined by the eligible entity1 consistent with applicable ,federal law and subject to rules issued by the ,secretary of ,labor4 7#d7 ,limitation ,an eligible entity that is a tribal government shall not be subject to the requirements of this subsection4 #djb4 ,use of funds 7a7 ,in general ,each eligible entity awarded a grant under section #dja shall use such funds to hire employees for jobs for which the primary duties are to be carried out by a natural person and that provide-- 7#a7 the support described in subsection 7b72 and 7#b7 the benefits described in subsection 7d74 7b7 ,use of funds ,an eligible entity shall use such grant funds to hire employees for jobs that provide job creation and support for any of the following in the geographic area in which such grant recipient is located3 7#a7 ,job creation to expand child care and early childhood education programs1 including staffing licensed child care facilities1 supporting preschool and early learning programs1 and providing classroom assistance1 after-school programming1 before-school programming1 family engagement services1 developmental screenings1 literacy initiatives1 and nutrition support for young children4 7#b7 ,job creation to support public education programs1 including tutoring1 mentoring1 classroom assistance1 special education support1 school library services1 educational technology assistance1 adult literacy instruction1 ,english language learning programs1 science1 technology1 engineering1 and mathematics education1 career and technical education support1 school-based mental health care professionals1 and enrichment programs for students of all ages4 7#c7 ,job creation to support health initiatives and programs1 including support for mental health professionals1 health care workers at underserved hospitals and clinics1 community health outreach1 vaccination campaigns1 disease prevention programs1 behavioral health support1 substance use prevention1 public health education1 health data collection1 emergency preparedness1 and assistance to local health departments4 7#d7 ,job creation to support elder care and disability support services1 including non-medical in-home assistance1 companionship services1 transportation assistance1 meal delivery1 respite care1 case management support1 accessibility improvements1 independent living services1 and programs that enable older adults and individuals with disabilities to remain safely in their communities4 7#e7 ,job creation to support housing construction and rehabilitation1 including the construction1 rehabilitation1 weatherization1 accessibility modifications1 lead hazard remediation1 energy efficiency upgrades for homes4 7#f7 ,job creation to support housing-insecure or homeless individuals1 including homelessness outreach and supportive housing services4 7#g7 ,job creation to support community violence prevention and public safety1 including violence interruption initiatives1 youth mentoring1 neighborhood outreach1 victim assistance1 crisis intervention support1 emergency preparedness education1 and other evidence-based public safety programs4 7#h7 ,job creation to support scientific research and innovation1 including technical support for federally funded research1 laboratory operations1 environmental monitoring1 scientific field work1 research data management1 technology development1 public-interest innovation1 and research assistance performed by ,federally ,funded ,research and ,development ,centers 7as such term is defined in section #b4aja of title #dh1 ,code of ,federal ,regulations1 or any successor regulation7 or an institution of higher education operated by a ,state or political subdivision of a ,state4 7#i7 ,job creation to support the construction1 repair1 maintenance1 modernization1 and inspection of roads1 bridges1 rail systems1 airports1 ports1 public buildings1 drinking water systems1 wastewater facilities1 broadband infrastructure1 sidewalks1 bicycle facilities1 parks1 and other public infrastructure4 7#aj7 ,job creation to support the commissioning of public art projects1 museum support1 archival preservation1 library services1 digitization of historical records1 cultural programming1 preservation of historic sites1 documentation of local history1 and community arts education4 7#aa7 ,job creation to support strengthening environmental conservation and climate resilience including through habitat restoration1 wetland conservation1 invasive species removal1 urban forestry1 watershed protection1 coastal restoration1 soil conservation1 carbon sequestration projects1 renewable energy deployment1 energy efficiency improvements1 and climate adaptation initiatives4 7#ab7 ,job creation to support wildfire prevention and disaster preparedness programs1 including forest management1 hazardous fuel reduction1 flood mitigation1 emergency shelter preparation1 disaster planning1 emergency logistics1 post-disaster debris removal1 hazard mapping1 community resilience projects1 and recovery assistance following federally declared disasters4 7#ac7 ,job creation to support the repair1 remodeling1 and beautification of schools1 community centers1 libraries1 and other community-based public facilities1 and the increase in the number of workers at such schools1 community centers1 libraries1 and other community-based public facilities4 7#ad7 ,job creation to support the renovation1 enhancement1 and maintenance of parks1 playgrounds1 public and tribal lands1 trails1 and other public spaces4 7#ae7 ,job creation to support local news and journalism1 including local news funds1 local news and community information organizations1 journalism fellowship programs1 and the maintenance and expansion of local1 nonprofit1 and public-interest news gathering and reporting capacity4 7#af7 ,job creation to support programs and training activities under the ,workforce ,innovation and ,opportunity ,act 7#bi ,u4,s4,c4 #caja et seq474 7#ag7 ,job creation to support other activities as determined by the ,director and the advisory committee established under section #djd to address public needs4 7c7 ,employee of an eligible entity 7#a7 ,in general ,to be eligible to be an employee hired by an eligible entity with grant funds awarded under this title1 an individual shall-- 7,a7 be #ah years or older2 and 7,b7 subject to paragraph 7#b71 be hired to perform any service for an eligible entity as an employee of such entity4 7#b7 ,exceptions ,an individual hired to perform any service for an eligible entity shall not be considered an employee of such entity if-- 7,a7 such individual is free from control and direction in connection with the performance of such service1 both under any contract for the performance of such service and in fact2 7,b7 the service performed by such individual is outside the usual course of the business of the entity2 or 7,c7 such individual is customarily engaged in an independently established trade1 occupation1 profession1 or business of the same nature as that involved in such service4 7d7 ,job requirements ,an eligible entity awarded a grant under section #dja shall provide each employee described under subsection 7c7 hired for the purpose of providing support under subsection 7b7 with-- 7#a7 a wage of not less than the greater of-- 7,a7 the minimum wage rate as established under section #f of the ,fair ,labor ,standards ,act of #aich 7#bi ,u4,s4,c4 #bjf72 7,b7 the minimum wage rate as established under applicable ,state or local law2 or 7,c7 the prevailing wage rate paid to workers in the same locality for similar work1 as determined by the ,secretary of ,labor1 and not less than the greater of the prevailing wage required under applicable ,federal1 ,state1 or local prevailing wage statute2 7#b7 coverage under a health insurance benefits plan comparable to the health insurance benefits plan offered to ,federal employees under the ,federal ,employees ,health ,benefits ,program established under chapter #hi of title #e1 ,united ,states ,code2 7#c7 at least #ab workweeks of family and medical leave benefits during any #ab-month period under section #ajb7;a7 of the ,family and ,medical ,leave ,act of #aiic 7#bi ,u4,s4,c4 #bfab7;a77 except that such employee shall be paid at a rate equal to their regular rate of pay for each week of such leave2 and 7#d7 the ability to earn #a hour of paid leave for every #cj hours worked1 but not greater than #ef hours of such leave in a year unless such entity chooses to set a higher limit1 to be used by such employee for any purpose4 7e7 ,nondisplacement 7#a7 ,nondisplacement of existing employees ,an eligible entity may not use grant funds awarded under section #dja to hire an employee that meets the requirements of subsection 7c7 for a job created under this section if-- 7,a7 employing such employee will result in the layoff or partial displacement of an existing employee of such entity2 7,b7 such employee will assume any of the duties or responsibilities of an existing employee of such entity who is on strike2 or 7,c7 such employee will perform work that is the same or substantially similar to the work performed by any existing employee at the same site of employment1 and if such existing employee-- 7i7 has been laid off or partially displaced as a result of such employee hired from grant funds awarded under section #dja2 and 7ii7 has not been offered to be restored to the position such existing employee had immediately prior to being laid off or partially displaced4 7#b7 ,existing employee defined ,the term existing employee1 when used with respect to an eligible entity1 means an employee who was an employee of the eligible entity on the date prior to the date an individual was hired using grant funds under this title4 #djc4 ,report ,not later than one year after the first grant is awarded under section #dja1 and annually thereafter1 the ,director shall submit a report to the ,committees on ,education and ,workforce of the ,house of ,representatives and the ,committee on ,health1 ,education1 ,labor1 and ,pensions of the ,senate1 including-- 7#a7 the number of grants awarded under section #dja2 and 7#b7 data on the jobs created under section #djb as a result of such grants1 including-- 7,a7 the number of jobs created for each grant awarded under section #dja2 and 7,b7 the average and median wage and the wage range paid by eligible entities for such jobs4 #djd4 ,advisory committee 7a7 ,establishment ,not later than #ahj days after the date of enactment of this ,act1 or #ij days after the establishment of the ,office under title ,,iii1 whichever is sooner1 the ,director shall establish an advisory committee 7in this section referred to as the ,committee7 to advise the ,office regarding the grant program established under section #dja4 7b7 ,membership ,the ,committee shall be composed of the following members3 7#a7 ,a designee of the ,secretary of ,labor4 7#b7 ,a designee of the ,secretary of ,commerce4 7#c7 ,a designee of the ,secretary of ,education4 7#d7 ,a designee of the ,chair of the ,federal ,reserve4 7#e7 ,a designee of the ,chair of the ,national ,labor ,relations ,board4 7#f7 ,one representative from the ,national ,science ,foundation4 7#g7 ,one representative from the ,council of ,economic ,advisors of the ,executive ,office of the ,president4 7#h7 ,one representative from the ,office of ,science and ,technology ,policy of the ,executive ,office of the ,president4 7#i7 ,not less than one representative from any union with two or more branches located in the ,states or territories of the ,united ,states and whose membership exceeds #ej1jjj members4 7#aj7 ,the governor of each ,state or their designee4 7#aa7 ,two economists studying macroeconomic labor trends4 7c7 ,chairperson ,the ,chairperson of the ,committee shall be designated by the ,director4 7d7 ,meetings ,not later than #cj days after the date of enactment of this ,act1 and on a quarterly basis thereafter1 the ,committee shall meet with the ,office to advise the ,director on the development and implementation of the jobs program under this title4 7e7 ,inapplicability of the ,federal ,advisory ,committee ,act ,chapter #aj of title #e1 ,united ,states ,code 7commonly known as the ,federal ,advisory ,committee ,act71 shall not apply to the ,committee4 #dje4 ,bureau of ,labor ,statistics duties 7a7 ,in general ,the ,bureau of ,labor ,statistics shall collect1 collate1 and report on the impacts of artificial intelligence on the workforce1 including impacts beyond-- 7#a7 job displacement as a result of artificial intelligence2 and 7#b7 the degradation of existing jobs1 including employees receiving lower pay or fewer hours or such jobs becoming temporary as a result of artificial intelligence4 7b7 ,authorization of appropriations ,there is authorized to be appropriated to the ,bureau of ,labor ,statistics #bj million dollars for each fiscal year beginning fiscal year #bjbg and ending fiscal year #bjca to carry out this section4 #djf4 ,additional ,workforce ,innovation and ,opportunity ,act funding ,for the fiscal year #bjbg1 and for each fiscal year thereafter1 there is authorized to be appropriated not greater than #bj percent of the funds appropriated to the trust fund established under section #bja to fund programs and training activities under the ,workforce ,innovation and ,opportunity ,act 7#bi ,u4,s4,c4 #caja et seq474 #djg4 ,definitions ,in this ,act3 7#a7 ,artificial intelligence ,the term artificial intelligence has the meaning given such term in section #ejjb of the ,national ,artificial ,intelligence ,initiative ,act of #bjbj 7#ae ,u4,s4,c4 #idja74 7#b7 ,director ,the term ,director means the ,director of the ,office of ,job ,creation4 7#c7 ,eligible entity ,the term an entity eligible means-- 7,a7 a ,state government2 7,b7 a unit of general local government1 as defined in section #c of the ,workforce ,innovation and ,opportunity ,act 7#bi ,u4,s4,c4 #cajb72 7,c7 a tribal government2 7,d7 an elementary school or a secondary school1 as defined in section #haja of the ,elementary and ,secondary ,education ,act of #aife 7#bj ,u4,s4,c4 #ghja71 that derive their support entirely or primarily from public funds2 7,e7 a local or ,state educational agency1 as defined in section #haja of the ,elementary and ,secondary ,education ,act of #aife 7#bj ,u4,s4,c4 #ghja72 7,f7 an institution of higher education2 or 7,g7 an organization described in section #eja7;c7 of the ,internal ,revenue ,code of #aihf and exempt from taxation under section #eja7;a7 of such ,code4 7#d7 ,full-time employee ,the term full-time employee means an employee who is employed1 on average1 at least #cj hours a week in a calender month4 7#e7 ,institution of higher education ,the term institution of higher education has the meaning given such term in section #aja of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajja74 7#f7 ,partial displacement ,the term partial displacement means any reduction in hours1 wages1 or employment benefits of an employee4 7#g7 ,permanent employee ,the term permanent employee means an employee who is not designated as a temporary employee and whose employment does not terminate after #a year or less after the date on which such employee began work at such job4