Labor Productivity Assistance Act

Labor Productivity Assistance Act - Establishes a program of loans for individuals who are unemployed, underemployed, displaced homemakers, or dislocated workers to upgrade job skills, learn new job skills, better their employment opportunities, and increase overall labor productivity.

Establishes in the Treasury a Labor Productivity Trust Fund. Authorizes the Secretary of the Treasury, as Trustee of the Fund, to issue to the Federal Financing Bank notes or other obligations in an amount not to exceed specified total and fiscal year limits. Sets forth requirements for the issuance of obligations and the deposit of proceeds from their sale or redemption.

Directs the Trustee (the Secretary of the Treasury) to transfer funds in each fiscal year out of the Fund to the Secretary of Labor ("the Secretary") in amounts necessary to carry out this Act, subject to the specified limitations. Provides that such transferred funds shall be available for making loans and for payment of administrative expenses under this Act. Directs the Trustee to make such expenditures from the Fund as are necessary for the redemption of notes and obligations issued pursuant to this Act.

Directs the Secretary to allocate funds from the Fund among the States, to the maximum extent possible, on the basis of the allocation set forth under specified provisions of the Job Training Partnership Act (JTPA) relating to the allocation of assistance to dislocated workers.

Sets forth individual eligibility requirements for loans under this Act. Directs the Secretary to promulgate regulations for the certification of eligible individuals identified in a specified manner. Authorizes the Secretary to use the local offices of the U.S. Employment Service in each State or in the private industry councils (PICs) established under JTPA to identify and certify any individual eligible to receive such a loan. Makes an individual eligible to receive such a loan if the individual is at least 25 years old and is: (1) a dislocated worker; (2) a displaced homemaker; (3) employed in a declining industry; or (4) underemployed. Requires each certified individual to comply with specified provisions before a PIC may approve a loan to such individual. Permits PICs, in reviewing loan applications, to modify eligibility requirements and certify individuals in five percent of the loan applications, notwithstanding specified eligibility requirements set forth in this Act.

Requires each certified individual desiring to receive a loan to: (1) receive counseling from the appropriate PIC regarding the loan program; (2) develop a written plan, with PIC assistance and including specified contents, for the use of a loan designed for the individualized needs of such individual; and (3) submit an application fully disclosing household income and assets. Requires a PIC to: (1) approve the loan application and written plan of any certified individual upon determination that the application and plan are in compliance with such requirements and that such approval would further the purposes of this Act; and (2) monitor the progress of an individual receiving a loan in accordance with the plan on at least a semiannual basis.

Provides that an individual's unemployment benefits shall not be reduced or suspended because such individual receives a loan under this Act.

Sets forth provisions relating to the terms of labor productivity assistance loans. Limits the amount of such a loan to $10,000 in aggregate per household, whether received as a single loan or as an additional loan to any other loan made under this Act. Provides for repayment of the principal in installments over a period of not more than 12 years, beginning the later of: (1) one year after the date of completion of the authorized activity approved in a recipient's plan, unless the recipient requests repayment to begin earlier; or (2) one month after the date on which such individual has an income in an amount equal to or exceeding 150 percent of the poverty line established under specified provisions of the Community Services Block Grant Act. Limits the annual interest rate on such loans and sets forth other requirements relating to loan repayment.

Sets forth the following authorized activities for which a certified individual may be approved for a loan under this Act: (1) employment search assistance; (2) job skills training, including any two-year college program; (3) relocation assistance; (4) a subsistence allowance; and (5) participation in any program, approved by a PIC, which is conducted by or in cooperation with an employer or labor union to provide early assistance to any individual who is adversely affected in employment because of plant closures or labor force reductions by an employer.

Directs the Secretary to enter into agreements with PICs to administer the labor productivity assistance loan program authorized by this Act. Sets forth specified powers of the Secretary under this Act. Provides that collection of loan repayments be made in accordance with procedures established by the Secretary of the Treasury, utilizing the Internal Revenue Service.