Child Support Assurance Act of 1994

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Child Support Assurance Act of 
1994''.

SEC. 2. FINDINGS AND PURPOSE.

    (a) Findings.--The Congress finds that--
            (1) the number of single-parent households has increased 
        significantly;
            (2) there is a high correlation between childhood poverty 
        and growing up in a single-parent household;
            (3) family dissolution often brings the economic 
        consequence of a lower standard of living for the custodian and 
        children;
            (4) children are nearly twice as likely to be in poverty 
        after a family dissolution as before a family dissolution;
            (5) one-fourth of the single mothers who are owed child 
        support receive none and another one-fourth of such mothers 
        receive only partial child support payments;
            (6) single mothers above and below the poverty line are 
        equally likely to receive none of the child support they are 
        owed; and
            (7) the failure of children to receive an adequate level of 
        child support limits the ability of such children to thrive and 
        to develop their potential and leads to long-term societal 
        costs in terms of health care, welfare, and loss in labor force 
        productivity.
    (b) Purpose.--It is the purpose of this Act to enable participating 
States to establish child support assurance systems in order to improve 
the economic circumstances of children who do not receive a minimum 
level of child support from the noncustodial parents of such children 
and to strengthen the establishment and enforcement of child support 
awards. The child support assurance approach is structured on a 
demonstration basis in order to implement and evaluate different 
options with respect to the provision of intensive support services and 
mechanisms for administering the program on a national basis.

SEC. 3. ESTABLISHMENT OF CHILD SUPPORT ASSURANCE DEMONSTRATION 
              PROJECTS.

    (a) In General.--In order to encourage States to provide a 
guaranteed minimum level of child support for every eligible child not 
receiving such support, the Secretary of Health and Human Services 
(hereafter in this section referred to as the ``Secretary'') shall make 
grants to not more than 6 States to conduct demonstration projects for 
the purpose of establishing or improving a system of assured minimum 
child support payments in accordance with this section.
    (b) Contents of Application.--An application for grants under this 
section shall be submitted by the Governor of a State and shall--
            (1) contain a description of the proposed child support 
        assurance project to be established, implemented, or improved 
        using amounts provided under this section, including the level 
        of the assured benefit to be provided, the specific activities 
        to be undertaken, and the agencies that will be involved;
            (2) specify whether the project will be carried out 
        throughout the State or in limited areas of the State;
            (3) estimate the number of children who will be eligible 
        for assured minimum child support payments under the project, 
        and the amounts to which they will be entitled on average as 
        individuals and in the aggregate;
            (4) describe the child support guidelines and review 
        procedures which are in use in the State and any expected 
        modifications;
            (5) contain a commitment by the State to carry out the 
        project during a period of not less than 3 and not more than 5 
        consecutive fiscal years beginning with fiscal year 1996;
            (6) contain assurances that the State--
                    (A) is currently at or above the national median 
                paternity establishment rate (as defined in section 
                452(g)(2) of the Social Security Act),
                    (B) will improve the performance of the agency 
                designated by the State to carry out the requirements 
                under part D of title IV of the Social Security Act by 
                at least 4 percent each year in which the State 
                operates a child support assurance project under this 
                section in--
                            (i) the number of cases in which paternity 
                        is established when required;
                            (ii) the number of cases in which child 
                        support orders are obtained; and
                            (iii) the number of cases with child 
                        support orders in which collections are made; 
                        and
                    (C) to the maximum extent possible under current 
                law, will use Federal, State, and local job training 
                assistance to assist individuals who have been 
                determined to be unable to meet such individuals' child 
                support obligations;
            (7) describe the extent to which multiple agencies, 
        including those responsible for administering the Aid to 
        Families With Dependent Children Program under part A of title 
        IV of the Social Security Act and child support collection, 
        enforcement, and payment under part D of such title, will be 
        involved in the design and operation of the child support 
        assurance project; and
            (8) contain such other information as the Secretary may 
        require by regulation.
    (c) Use of Funds.--A State shall use amounts provided under a grant 
awarded under this section to carry out a child support assurance 
project designed to provide a minimum monthly child support benefit for 
each eligible child in the State to the extent that such minimum child 
support is not paid in a month by the noncustodial parent.
    (d) Requirements.--(1) A child support assurance project funded 
under this section shall provide that--
            (A) any child (as defined in paragraph (2)) with a living 
        noncustodial parent for whom a child support order has been 
        sought (as defined in paragraph (3)) or obtained and any child 
        who meets ``good cause'' criteria for not seeking or enforcing 
        a support order is eligible for the assured child support 
        benefit;
            (B) the assured child support benefit shall be paid 
        promptly to the custodial parent at least once a month and 
        shall be--
                    (i) an amount determined by the State which is--
                            (I) not less than $1,500 per year for the 
                        first child, $1,000 per year for the second 
                        child, and $500 per year for the third and each 
                        subsequent child, and
                            (II) not more than $3,000 per year for the 
                        first child and $1,000 per year for the second 
                        and each subsequent child;
                    (ii) offset and reduced to the extent that the 
                custodial parent receives child support in a month from 
                the noncustodial parent;
                    (iii) indexed and adjusted for inflation; and
                    (iv) in the case of a family of children with 
                multiple noncustodial parents, calculated in the same 
                manner as if all such children were full siblings, but 
                any child support payment from a particular 
                noncustodial parent shall only be applied against the 
                assured child support benefit for the child or children 
                of that particular noncustodial parent;
            (C) for purposes of determining the need of a child or 
        relative and the level of assistance, one-half of the amount 
        received as a child support payment shall be disregarded from 
        income until the total amount of child support and Aid to 
        Families With Dependent Children benefit received under part A 
        of title IV of the Social Security Act equals the Federal 
        poverty level for a family of comparable size;
            (D) in the event that the family as a whole becomes 
        ineligible for Aid to Families With Dependent Children under 
        part A of the Social Security Act due to consideration of 
        assured child support benefits, the continuing eligibility of 
        the caretaker for Aid to Families With Dependent Children under 
        such title shall be calculated without consideration of the 
        assured child support benefit; and
            (E) in order to participate in the child support assurance 
        project, the child's caretaker shall apply for services of the 
        State's child support enforcement program under part D of title 
        IV of the Social Security Act.
    (2) For purposes of this section, the term ``child'' means an 
individual who is of such an age, disability, or educational status as 
to be eligible for child support as provided for by the law of the 
State in which such individual resides.
    (3) For purposes of this section, a child support order shall be 
deemed to have been ``sought'' where an individual has applied for 
services from the State agency designated by the State to carry out the 
requirements of part D of title IV of the Social Security Act or has 
sought a child support order through representation by private or 
public counsel or pro se.
    (e) Consideration and Priority of Applications.--(1) The Secretary 
shall consider all applications received from States desiring to 
conduct demonstration projects under this section and shall approve not 
more than 6 applications which appear likely to contribute 
significantly to the achievement of the purpose of this section. In 
selecting States to conduct demonstration projects under this section, 
the Secretary shall--
            (A) ensure that the applications selected represent a 
        diversity of minimum benefits distributed throughout the range 
        specified in subsection (d)(1)(B)(i);
            (B) consider the geographic dispersion and variation in 
        population of the applicants;
            (C) give priority to States the applications of which 
        demonstrate--
                    (i) significant recent improvements in--
                            (I) establishing paternity and child 
                        support awards,
                            (II) enforcement of child support awards, 
                        and
                            (III) collection of child support payments;
                    (ii) a record of effective automation; and
                    (iii) that efforts will be made to link child 
                support systems with other service delivery systems;
            (D) ensure that the proposed projects will be of a size 
        sufficient to obtain a meaningful measure of the effects of 
        child support assurance;
            (E) give priority, first, to States intending to operate a 
        child support assurance project on a statewide basis, and, 
        second, to States that are committed to phasing in an expansion 
        of such project to the entire State, if interim evaluations 
        suggest such expansion is warranted; and
            (F) ensure that, if feasible, the States selected use a 
        variety of approaches for child support guidelines.
    (2) Of the States selected to participate in the demonstration 
projects conducted under this section, the Secretary shall require, if 
feasible--
            (A) that at least 2 provide intensive integrated social 
        services for low-income participants in the child support 
        assurance project, for the purpose of assisting such 
        participants in improving their employment, housing, health, 
        and educational status; and
            (B) that at least 2 have adopted the Uniform Interstate 
        Family Support Act.
    (f) Duration.--(1) During fiscal year 1995, the Secretary shall 
develop criteria, select the States to participate in the 
demonstration, and plan for the evaluation required under subsection 
(h). The demonstration projects conducted under this section shall 
commence on October 1, 1995, and shall be conducted for not less than 3 
and not more than 5 consecutive fiscal years, except that the Secretary 
may terminate a project before the end of such period if the Secretary 
determines that the State conducting the project is not in substantial 
compliance with the terms of the application approved by the Secretary 
under this section.
    (g) Cost Savings Recovery.--The Secretary shall develop a 
methodology to identify any State cost savings realized in connection 
with the implementation of a child support assurance project conducted 
under this Act. Any such savings realized as a result of the 
implementation of a child support assurance project shall be utilized 
for child support enforcement improvements or expansions and 
improvements in the Aid to Families With Dependent Children Program 
conducted under part A of title IV of the Social Security Act within 
the participating State.
    (h) Evaluation and Report to Congress.--(1) The Secretary shall 
conduct an evaluation of the effectiveness of the demonstration 
projects funded under this section. The evaluation shall include an 
assessment of the effect of an assured benefit on--
            (A) income from nongovernment sources and the number of 
        hours worked;
            (B) the use and amount of government supports;
            (C) the ability to accumulate resources;
            (D) the well-being of the children, including educational 
        attainment and school behavior; and
            (E) the State's rates of establishing paternity and support 
        orders and of collecting support.
    (2) Three and 5 years after commencement of the demonstration 
projects, the Secretary shall submit an interim and final report based 
on the evaluation to the Committee on Finance and the Committee on 
Labor and Human Resources of the Senate, and the Committee on Ways and 
Means and the Committee on Education and Labor of the House of 
Representatives concerning the effectiveness of the child support 
assurance projects funded under this section.
    (i) State Reports.--The Secretary shall require each State that 
conducts a demonstration project under this section to annually report 
such information on the project's operation as the Secretary may 
require, except that all such information shall be reported according 
to a uniform format prescribed by the Secretary.
    (j) Restrictions on Matching and Use of Funds.--(1) A State 
conducting a demonstration project under this section shall be 
required--
            (A) except as provided in paragraph (2), to provide not 
        less than 20 percent of the total amounts expended in each 
        calendar year of the project to pay the costs associated with 
        the project funded under this section;
            (B) to maintain its level of expenditures for child support 
        collection, enforcement, and payment at the same level, or at a 
        higher level, than such expenditures were prior to such State's 
        participation in a demonstration project provided by this 
        section; and
            (C) to maintain the Aid to Families With Dependent Children 
        benefits provided under part A of title IV of the Social 
        Security Act at the same level, or at a higher level, as the 
        level of such benefits on the date of the enactment of this 
        Act.
    (2) A State participating in a demonstration project under this 
section may provide no less than 10 percent of the total amounts 
expended to pay the costs associated with the project funded under this 
section in years after the first year such project is conducted in a 
State if the State meets the improvements specified in subsection 
(b)(6)(B).
    (k) Coordination With Certain Means-Tested Programs.--For purposes 
of--
            (1) the United States Housing Act of 1937;
            (2) title V of the Housing Act of 1949;
            (3) section 101 of the Housing and Urban Development Act of 
        1965;
            (4) sections 221(d)(3), 235, and 236 of the National 
        Housing Act;
            (5) the Food Stamp Act of 1977;
            (6) title XIX of the Social Security Act; and
            (7) child care assistance provided through part A of title 
        IV of the Social Security Act, the Child Care and Development 
        Block Grant, or title XX of the Social Security Act,
any payment made to an individual within the demonstration project area 
for child support up to the amount which an assured child support 
benefit would provide shall not be treated as income and shall not be 
taken into account in determining resources for the month of its 
receipt and the following month.
    (l) Treatment of Child Support Benefit.--Any assured child support 
benefit received by an individual under this Act shall be considered 
child support for purposes of the Internal Revenue Code of 1986.
    (m) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as may be necessary in each of the fiscal years 
1995, 1996, 1997, 1998, 1999, and 2000 to carry out the purposes of 
this Act.

Summary: Child Support Assurance Act of 1994 - Directs the Secretary of Health and Human Services to make grants to up to six States for demonstration programs to establish or improve a system of assured minimum child support payments. Requires the custodial parent to have, or be in the process of obtaining, a child support award, or the child to have good cause for the absence of such an award, to qualify for the program. Authorizes appropriations.