SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Supplemental Social Security Income 
Flexibility Act of 1995''.

SEC. 2. BLOCK GRANTS TO THE STATES FOR SUPPLEMENTAL SECURITY INCOME FOR 
              THE DISABLED AND BLIND.

    (a) In General.--Title XVI of the Social Security Act (42 U.S.C. 
1381-1383d) is amended by adding at the end the following new part:

 ``Part C--Block Grants to States for Supplemental Security Income for 
                         the Disabled and Blind

                       ``purpose; implementation

    ``Sec. 1651. (a) Purpose.--The purpose of this part is to 
consolidate Federal assistance to the States for supplemental income 
for individuals who are disabled or blind (other than individuals who 
have attained age 65) into a single grant for such purpose, thereby 
giving States maximum flexibility to--
            ``(1) require beneficiaries who are parents to ensure that 
        their school-age children attend school;
            ``(2) require minors who are beneficiaries to attend 
        school;
            ``(3) require parent beneficiaries to ensure that their 
        children receive the full complement of childhood 
        immunizations;
            ``(4) require beneficiaries not to use illegal drugs or 
        abuse other drugs;
            ``(5) deny assistance to children solely on the basis that 
        a child is unable to perform age-appropriate activities;
            ``(6) deny assistance to individiuals whose disabilities 
        are primarily the result of their abuse of illegal or legal 
        drugs, or alcohol;
            ``(7) deny assistance to illegal aliens;
            ``(8) require individuals who sponsor the residency of 
        legal aliens to support those they sponsor;
            ``(9) involve religious and charitable organizations, 
        voluntary associations, civic groups, community organizations, 
        nonprofit entities, benevolent and fraternal orders, 
        philanthropic entities, and other groups in the private sector, 
        as appropriate, in the provision of assistance to needy 
        disabled and blind individuals which the funding States receive 
        under this part.
    ``(b) Implementation.--This purpose shall be implemented in 
accordance with conditions in each State and as determined by State 
law.

                          ``payments to states

    ``Sec. 1652. (a) Amount.--
            ``(1) In general.--Each State shall, subject to the 
        requirements of this part, be entitled to receive quarterly 
        payments for fiscal years 1997, 1998, 1999, and 2000 in an 
        amount equal to 25 percent of the annual amount determined 
        under paragraph (2) for such fiscal year for carrying out the 
        purpose described in section 1651.
            ``(2) Annual amount.--The annual amount determined under 
        this paragraph is equal to--
                    ``(A) in fiscal year 1997, 100 percent of the 
                amounts received by the State in fiscal year 1994, or 
                100 percent of the average of amounts received by the 
                State in fiscal years 1992, 1993, and 1994, whichever 
                is greater, under part A of this title with respect to 
                persons who are disabled or blind indivudals, other 
                than individuals who have attained age 65 (as in effect 
                in fiscal year 1994, or if applicable, in fiscal years 
                1992, 1993, 1994), and
            ``(B) in each fiscal year thereafter, 100 percent of the 
        amount received by the State in the preceding fiscal year under 
        this part (as in effect in such preceding fiscal year).
    ``(b) Funding Requirements.--The Secretary of the Treasury shall 
make quarterly payments described in subsection (a)(1) directly to each 
State in accordance with section 6503 of title 31, United States Code.
    ``(c) Expenditure of Funds; Rainy Day Fund.--Amounts received by a 
State under this part for any fiscal year shall be expended by the 
State in such fiscal year or in the succeeding fiscal year; except for 
such amounts as the State deems
 necessary to set aside in a separate account to provide, without 
fiscal limitation, for unexpected levels of assistance as a result of 
events which cause an unexpected increase in the need for providing 
supplemental income for individuals who are disabled or blind (other 
than individuals who have attained the age 65). Any amounts remaining 
in such segregated account after fiscal year 2000 shall be expended by 
a State for the purpose described in section 1651 of this part as in 
effect in fiscal year 2000.
    ``(d) Prohibition on Use of Funds.--Except as provided in 
subsection (e), a State to which a payment is made under this part may 
not use any part of such payment to provide medical services.
    ``(e) Authority To Use Portion of Grant for Other Purposes.--
            ``(1) In general.--A State may use not more than 30 percent 
        of the annual amount paid to the State under this part for a 
        fiscal year to carry out a State program pursuant to any or all 
        of the following provisions of law:
                    ``(A) Part A of title IV of this Act.
                    ``(B) Title XIX of this Act.
                    ``(C) The Food Stamp Act.
            ``(2) Applicable rules.--Any amount paid to the State under 
        this part that is used to carry out a State program pursuant to 
        a provision of law specified in paragraph (1) shall not be 
        subject to the requirements of this part, but shall be subject 
        to the requirements that apply to Federal funds provided 
        directly under the provision of law to carry out the program.

               ``administrative and fiscal accountability

    ``Sec. 1653. (a) Audits; Reimbursements.--
            ``(1) Audits.--
                    ``(A) In general.--A State shall, not less than 
                annually, audit the State expenditures from amounts 
                received under this part. Such audit shall--
                            ``(i) determine the extent to which such 
                        expenditures were or were not expended in 
                        accordance with this part; and
                            ``(ii) be conducted by an approved entity 
                        (as defined in subparagraph (B)) in accordance 
                        with generally accepted auditing principles.
                    ``(B) Approved entity.--For purposes of 
                subparagraph (A), the term `approved entity' means an 
                entity that is--
                            ``(i) approved by the Secretary of the 
                        Treasury;
                            ``(ii) approved by the chief executive 
                        officer of the State; and
                            ``(iii) independent of any agency 
                        administering activities funded under this 
                        part.
            ``(2) Reimbursement.--
                    ``(A) In general.--Not later than 30 days following 
                the completion of an audit under this subsection, a 
                State shall submit a copy of the audit to the State 
                legislature and to the Secretary of the Treasury.
                    ``(B) Repayment.--Each State shall pay to the 
                United States amounts ultimately found by the approved 
                entity under paragraph (1)(A) not to have been expended 
                in accordance with this part plus 10 percent of such 
                amount as a penalty, or the Secretary of the Treasury 
                may offset such amounts plus the 10 percent penalty 
                against any other amount in any other year that the 
                State may be entitled to receive under this part.
    ``(b) Additional Accounting Requirements.--The provisions of 
chapter 75 of title 31, United States Code, shall apply to the audit 
requirements of this section.
    ``(c) Reporting Requirements; Form, Contents.--
            ``(1) Annual reports.--A State shall prepare comprehensive 
        annual reports on the activities carried out with amounts 
        received by a State under this part.
            ``(2) Content.--Reports prepared under this section--
                    ``(A) shall be for the most recently completed 
                fiscal year;
                    ``(B) shall be in accordance with generally 
                accepted accounting principles, including the 
                provisions of chapter 75 of title 31, United States 
                Code;
                    ``(C) shall include the results of the most recent 
                audit conducted in accordance with the requirements of 
                subsection (a) of this section; and
                    ``(D) shall be in such form and contain such other 
                information as the State deems necessary--
                            ``(i) to provide an accurate description of 
                        such activities; and
                            ``(ii) to secure a complete record of the 
                        purposes for which amounts were expended in 
                        accordance with this part.
            ``(3) Copies.--A State shall make copies of the reports 
        required under this section available for public inspection 
        within the State. Copies also shall be provided upon request to 
        any interested public agency, and each such agency may provide 
        its views on such reports to the Congress.
    ``(d) Administrative Supervision--
            ``(1) Role of the secretary of the treasury.--
                    ``(A) In general.--The Secretary of the Treasury 
                shall supervise the amounts received under this part in 
                accordance with subparagraph (B).
                    ``(B) Limited supervision--The supervision by the 
                Secretary of the Treasury shall be limited to--
                            ``(i) making quarterly payments to the 
                        States in accordance with section 1652(b);
                            ``(ii) approving the entities referred to 
                        in subsection (a)(1)(B); and
                            ``(iii) withholding payment to a State 
                        based on the findings of such an entity in 
                        accordance with subsection (a)(2)(B).
            ``(2) Other federal supervision.--No administrative officer 
        or agency of the United States, other than the Secretary of the 
        Treasury and, as provided for in section 1654, the Attorney 
        General, shall supervise the amounts received by the States 
        under this part or the use of such amounts by the States.
    ``(e) Limited Federal Oversight.--With the exception of the 
Department of the Treasury as provided for in this section and section 
1654 of this part, no Federal department or agency may promulgate 
regulations or issue rules regarding the purpose of this part.

                     ``nondiscrimination provisions

    ``Sec. 1654. (a) No Discrimination Against Individuals.--No 
individual shall be excluded from participation in, denied the benefits 
of, or subjected to discrimination under any program or activity funded 
in whole or in part with amounts received under this part on the basis 
of such individual's--
            ``(1) disability under section 504 of the Rehabilitation 
        Act of 1973 (29 U.S.C. 794);
            ``(2) sex under title IX of the Education Amendments of 
        1972 (20 U.S.C. 1681 et seq.); or
            ``(3) race, color, or national origin under title VI of the 
        Civil Rights Act of 1964 (42 U.S.C. 2000d et seq.).
    ``(b) Compliance.--If the Secretary of the Treasury determines that 
a State, or an entity that has received funds from amounts received by 
the State under this part, has failed to comply with a provision of law 
referred to in subsection (a), except as provided for in section 1655 
of this part, the Secretary of the Treasury shall notify the chief 
executive officer of the State and shall request the officer to secure 
compliance with such provision of law. If, not later than 60 days after 
receiving such notification, the chief executive officer fails or 
refuses to secure compliance, the Secretary of the Treasury may--
            ``(1) refer the matter to the Attorney General with a 
        recommendation that an appropriate civil action be instituted;
            ``(2) exercise the powers and functions provided under 
        title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et 
        seq.), title IX of the Education Amendments of 1972 (20 U.S.C. 
        1681 et seq.); or section 505 of the Rehabilitation Act of 1973 
        (29 U.S.C. 794a), (as applicable); or
            ``(3) take such other action as may be provided by law.
    ``(c) Authority of Attorney General; Civil Actions.--When a matter 
is referred to the Attorney General pursuant to subsection (b)(1), or 
if the Attorney General has reason to believe that an entity is engaged 
in a pattern or practice in violation of a provision of law referred to 
in subsection (a), the Attorney General may bring a civil action in an 
appropriate district court of the United States for such relief as may 
be appropriate, including injunctive relief.

    ``nondiscrimination and institutional protections for religious 
                               providers

    ``Sec. 1655. (a) Purpose.--The purpose of this section is to allow 
the participation of religious organizations as providers of assistance 
to disabled or blind individuals funded under this part without 
impairing or diminishing the religious character or freedom of such 
organizations.
    ``(d) Nondiscrimination.--Religious organizations shall be eligible 
as providers of assistance to disabled or blind individuals as provided 
for under this part. Neither the Federal Government nor a State 
receiving funds under this part shall discriminate against an 
organization which is or applies to be a provider of assistance
 on the basis that the organization has a religious mission or purpose.
    ``(c) Religious Character and Freedom.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, any religious organization participating as a provider of 
        assistance funded under this part shall retain its independence 
        from Federal, State, and local governments, including such 
        organization's control over the definition, development, 
        practice, and expression of its religious beliefs. Such an 
        organization may select, employ, promote, discipline, and 
        dismiss its clerics and other ecclesiastics, directors, 
        officers, employees, and volunteers on the basis of religion, a 
        religious belief, or a religious practice. However, a religious 
        organization shall not deny disabled or blind individuals the 
        benefits of any assistance funded under this part on the basis 
        of religion, a religious belief, or refusal to participate in a 
        religious practice.
            ``(2) Additional safeguards.--Neither the Federal 
        Government nor a State shall require a religious provider of 
        assistance to--
                    ``(A) alter its form of internal governance, or 
                form a separate, nonprofit corporation to receive and 
                administer assistance funded under this part; or
                    ``(B) alter real estate or facilities used to 
                provide such assistance, including but not limited to 
                the removal of religious art, icons, scripture, or 
                other symbols;
        in order to be eligible to be a provider of assistance under 
        this part.
            ``(3) Fiscal accountability.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), any religious organization providing 
                assistance funded under this part shall be subject to 
                the same regulations as other providers to account in 
                accord with generally accepted auditing principles for 
                the use of such funds provided under this part.
                    ``(B) Limited audit.--Religious organizations may 
                segregate Federal funds provided under this part into 
                separate accounts, and then only the financial 
                assistance provided with those funds shall be subject 
                to audit.
    ``(d) Compliance.--A religious organization which has its rights 
under this section violated may enforce its claim by asserting a civil 
action for such relief as may be appropriate, including injunctive 
relief or damages, in an appropriate district court of the United 
States against the entity or agency that commits such violation.
    ``(e) Rights of Beneficiaries of Assistance.--
            ``(1) In general.--If a beneficiary has a bona fide 
        objection to the religious character of the organization or 
        institution from which the beneficiary is receiving assistance 
        funded under this part, each State shall provide such 
        beneficiary a certificate, redeemable with any other provider 
        of assistance funded under this part, for services the value of 
        which is no less than the value of the funding received by the 
        religious provider from a State to provide assistance funded 
        under this part for such individual.
            ``(2) Prohibition on providing cash in exchange for 
        certificates.--No provider of assistance funded under this part 
        shall provide a beneficiary a cash amount in exchange for a 
        certificate provided for under paragraph (1).''.
    (b) Conforming Amendment.--Section 1602 of the Social Security Act 
(42 U.S.C. 1381a) is amended by striking ``Every'' and inserting ``(a) 
Every'' and by adding at the end the following new subsection:
    ``(b) No person who is a disabled or blind individual (other than a 
person who has attained age 65) shall be an eligible individual or 
eligible spouse for purposes of this part with respect to any month 
beginning after September 30, 1996, but shall be eligible for services 
to the disabled or blind funded under part C of this title.''.

SEC. 3. CONFORMING AMENDMENTS TO THE BUDGET ACT.

    The Balanced Budget and Emergency Deficit Control Act of 1985 (2 
U.S.C. 900 et seq.) is amended in section 255(h) (2 U.S.C. 905(h), by 
striking ``Supplemental Security Income Program (75-0406-0-1-609); 
and'' and inserting ``Supplemental Security Income Program and block 
grants to States for supplemental security income for disabled 
individuals; and''.

SEC. 4. EFFECTIVE DATE.

    The amendments and repeals made by this Act shall take effect on 
October 1, 1996.
Supplemental Social Security Income Flexibility Act of 1995 - Amends title XVI (Supplemental Security Income) (SSI) of the Social Security Act to add a new part, Part C:  Block Grants to States for Supplemental Security Income for the Disabled and Blind.  States that the purpose of this part is to consolidate Federal SSI assistance to the States into a single grant, thereby giving States maximum flexibility to make State-specific requirements for individuals receiving benefits.  Identifies certain requirements, including those relating to school attendance, immunizations, drug abuse, illegal aliens, and charitable, religious, and nonprofit organizations.   Caps SSI spending levels.  Directs the Secretary of the Treasury to supervise the amounts received under Part C.
Supplemental Social Security Income Flexibility Act of 1995