S-3864-119
Read twice and referred to the Committee on Finance.
Sponsored by Cory Booker (D-NJ)
What it does
This bill would require the Secretary of Labor to establish a pilot grant program awarding competitive grants to up to 15 local governments or Tribal entities in areas with unemployment rates at least 150% of the national average. Grant recipients would use the funds to run "job guarantee programs" — offering employment to any adult resident who applies, with wages at or above prevailing and minimum wage levels, health benefits comparable to federal employee coverage, and paid family and sick leave. Grants would last up to three years, and the bill also expands the Work Opportunity Tax Credit to incentivize private employers to hire program participants after they leave the program.
Who benefits
Unemployed and underemployed adults in high-unemployment localities who would gain access to guaranteed employment. Residents of Tribal nations, which may use their own employment data to qualify. Individuals with barriers to employment — including formerly incarcerated people, people with disabilities, and those with low literacy — who would receive targeted training and supportive services (child care, transportation, housing assistance). Workers who transition out of the program into private employment, who would make their new employers eligible for the Work Opportunity Tax Credit. Local governments and Tribal entities that receive grants and can direct labor toward community needs. Child care and senior care recipients, as the bill prioritizes those job categories. Communities that benefit from clean energy and infrastructure work performed under the program.
Who is hurt
Private-sector employers in pilot areas who may face upward wage pressure if the program raises local wage floors or labor competition. Existing public employees and unions whose positions could theoretically be affected, though the bill explicitly prohibits displacement of existing workers. Taxpayers broadly, as the bill appropriates "such sums as may be necessary" with no specified cap, creating open-ended fiscal exposure. Non-pilot-area residents who face similar unemployment conditions but are ineligible for the program. Private training providers who may be bypassed in favor of publicly funded training. Federal agencies that must absorb administrative burden to identify and list available jobs, even though they are later reimbursed.
Supporters argue
Supporters argue that persistent high unemployment in specific localities — particularly rural areas and Tribal lands — reflects structural failures that private markets have not corrected, and that a direct public employment guarantee is the most targeted response. They contend the pilot design — capped at 15 sites, time-limited to three years, and subject to rigorous independent evaluation — is specifically structured to generate evidence before any broader expansion, reducing fiscal and policy risk. They also argue the bill's wage and benefit floors (prevailing wage, federal-employee-equivalent health coverage, paid leave) would raise living standards for the lowest-income workers in the most distressed communities, with the Work Opportunity Tax Credit creating a bridge to private-sector employment upon program exit.
Opponents argue
Opponents argue that government-guaranteed employment at above-market wages and benefits could crowd out private-sector job creation in pilot areas, as businesses struggle to compete with a public employer offering federally subsidized compensation packages. They contend the open-ended appropriation ("such sums as may be necessary") provides no fiscal guardrail, and that similar public employment programs — such as the CETA program of the 1970s — were ultimately discontinued due to cost overruns, displacement of regular government workers, and limited long-term employment gains for participants. They further argue that delegating broad formula and priority-setting authority to the Secretary of Labor, with minimal statutory constraints, raises concerns under the major questions doctrine and post-Loper Bright judicial scrutiny of agency discretion.
Constitutional context
Congress's authority to fund employment programs rests on the Spending Clause (Art. I, §8) and the Commerce Clause, both of which have historically supported broad federal workforce legislation. However, the bill delegates significant discretion to the Secretary of Labor — including grant formula design, job priority lists, and prohibited activities — which could face scrutiny under the major questions doctrine established in West Virginia v. EPA (2022) and the end of Chevron deference under Loper Bright v. Raimondo (2024), as courts will now independently assess whether the statutory language clearly authorizes the scope of agency action.
Checks and balances
The Executive Branch (Secretary of Labor) gains substantial new authority to design grant formulas, set national job priorities, and determine prohibited activities; checks include annual Inspector General audits, mandatory grantee reporting, congressional appropriations control, and judicial review of agency rulemaking under the post-Loper Bright independent-judgment standard.
Historical precedent
The Comprehensive Employment and Training Act (CETA, 1973–1982) created a large-scale federal public service employment program; it was ultimately repealed amid concerns about worker displacement, cost, and limited long-term labor market gains for participants.