I

104TH CONGRESS

1ST SESSION H. R. 1135

To improve the Commodity Distribution Programs of the Department of

Agriculture, to Reform and Simplify the Food Stamp Program, and

for other purposes.

IN THE HOUSE OF REPRESENTATIVES

Mr. ROBERTS introduced the following bill; which was referred to the

Committee on Agriculture

A BILL

To improve the Commodity Distribution Programs of the

Department of Agriculture, to Reform and Simplify the

Food Stamp Program, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This title may be cited as the ‘‘Food Stamp Program

5 and Commodity Distribution Act’’.
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1 TITLE I—COMMODITY

2 DISTRIBUTION

3 SEC. 101. SHORT TITLE.

4 This title may be cited as the ‘‘Commodity Distribu5 tion Act of 1995’’.

6 SEC. 102. AVAILABILITY OF COMMODITIES.

7 (a) Notwithstanding any other provision of law, the

8 Secretary of Agriculture (hereinafter in this subtitle re9 ferred to as the ‘‘Secretary’’) is authorized during fiscal

10 years 1996 through 2000 to purchase a variety of nutri11 tious and useful commodities and distribute such commod12 ities to the States for distribution in accordance with this

13 title.

14 (b) In addition to the commodities described in sub15 section (a), the Secretary may expend funds made avail16 able to carry out the section 32 of the Act of August 24,

17 1935 (7 U.S.C. 612c), which are not expended or needed

18 to carry out such sections, to purchase, process, and dis19 tribute commodities of the types customarily purchased

20 under such section to the States for distribution in accord21 ance to this title.

22 (c) In addition to the commodities described in sub23 sections (a) and (b), agricultural commodities and the

24 products thereof made available under clause (2) of the

25 second sentence of section 32 of the Act of August 24,
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1 1935 (7 U.S.C. 612c), may be made available by the Sec2 retary to the States for distribution in accordance with

3 this title.

4 (d) In addition to the commodities described in sub5 sections (a), (b), and (c), commodities acquired by the

6 Commodity Credit Corporation that the Secretary deter7 mines, in the discretion of the Secretary, are in excess of

8 quantities need to—

9 (1) carry out other domestic donation pro10 grams;

11 (2) meet other domestic obligations;

12 (3) meet international market development and

13 food aid commitments, and

14 (4) carry out the farm price and income sta15 bilization purposes of the Agricultural Adjustment

16 Act of 1938, the Agricultural Act of 1949, and the

17 Commodity Credit Corporation Charter Act;

18 shall be made available by the Secretary, without charge

19 or credit for such commodities, to the States for distribu20 tion in accordance with this title.

21 (e) During each fiscal year, the types, varieties and

22 amounts of commodities to be purchased under this title

23 shall be determined by the Secretary. In purchasing such

24 commodities, except those commodities purchased pursu-
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1 ant to section 110, the Secretary shall, to the extent prac2 ticable and appropriate, make purchases based on—

3 (1) agricultural market conditions; and

4 (2) the preferences and needs of States and dis5 tributing agencies.

6 SEC. 103. STATE, LOCAL AND PRIVATE SUPPLEMENTATION

7 OF COMMODITIES.

8 (a) The Secretary shall establish procedures under

9 which State and local agencies, recipient agencies, or any

10 other entity or person may supplement the commodities

11 distributed under this subtitle for use by recipient agencies

12 with nutritious and wholesome commodities that such en13 tities or persons donate for distribution, in all or part of

14 the State, in addition to the commodities otherwise made

15 available under this title.

16 (b) States and eligible recipient agencies may use—

17 (1) the funds appropriated for administrative

18 cost under section 109(b);

19 (2) equipment, structures, vehicles, and all

20 other facilities involved in the storage, handling, or

21 distribution of commodities made available under

22 this title; and

23 (3) the personnel, both paid or volunteer, in24 volved in such storage, handling, or distribution;
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1 to store, handle or distribute commodities donated for use

2 under subsection (a).

3 (c) States and recipient agencies shall continue, to

4 the maximum extent practical, to use volunteer workers,

5 and commodities and other foodstuffs donated by chari6 table and other organizations, in the distribution of com7 modities under this title.

8 SEC. 104. STATE PLAN.

9 (a) Each State seeking to receive commodities under

10 this title shall submit a plan of operation and administra11 tion every four years to the Secretary for approval. The

12 plan may be amended at any time, with the approval of

13 the Secretary.

14 (b) The State plan, at a minimum, shall—

15 (1) designate the State agency responsible for

16 distributing the commodities received under this

17 title;

18 (2) set forth a plan of operation and adminis19 tration to expeditiously distribute commodities under

20 this title in quantities requested to eligible recipient

21 agencies in accordance with sections 106 and 110;

22 (3) set forth the standards of eligibility for re23 cipient agencies; and
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1 (4) set forth the standards of eligibility for indi2 vidual or household recipients of commodities, which

3 at minimum shall require—

4 (A) individuals or households to be com5 prised of needy persons; and

6 (B) individual or household members to be

7 residing in the geographic location served by

8 the distributing agency at the time of applica9 tion for assistance.

10 (c) The Secretary shall encourage each State receiv11 ing commodities under this title to establish a State advi12 sory board consisting of representatives of all interested

13 entities, both public and private, in the distribution of

14 commodities received under this title in the State.

15 (d) Each State agency receiving commodities under

16 this title may—

17 (1) enter into cooperative agreements with

18 State agencies of other States to jointly provide

19 commodities received under this subtitle to eligible

20 recipient agencies that serve needy persons in a sin21 gle geographical area which includes such States; or

22 (2) transfer commodities received under this

23 title to any such eligible recipient agency in the

24 other State under such agreement.
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1 SEC. 105. ALLOCATION OF COMMODITIES TO STATES.

2 (a) In each fiscal year, except for those commodities

3 purchased under section 110, the Secretary shall allocate

4 as follows:

5 (1) 60 percent of the such total value of com6 modities shall be allocated in a manner such that the

7 value of commodities allocated to each State bears

8 the same ratio to 60 percent of such total value as

9 the number of persons in households within the

10 State having incomes below the poverty line bears to

11 the total number of persons in households within all

12 States having incomes below such poverty line. Each

13 State shall receive the value of commodities allocated

14 under this paragraph.

15 (2) 40 percent of such total value of commod16 ities shall be allocated in a manner such that the

17 value of commodities allocated to each State bears

18 the same ratio to 40 percent of such total value as

19 the average monthly number of unemployed persons

20 within the State bears to the average monthly num21 ber of unemployed persons within all States during

22 the same fiscal year. Each State shall receive the

23 value of commodities allocated to the State under

24 this paragraph.

25 (b)(1) The Secretary shall notify each State of the

26 amount of commodities that such State is allotted to re-
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1 ceive under subsection (a) or this subsection, if applicable.

2 Each State shall promptly notify the Secretary if such

3 State determines that it will not accept any or all of the

4 commodities made available under such allocation. On

5 such a notification by a State, the Secretary shall reallo6 cate and distribute such commodities as the Secretary

7 deems appropriate and equitable. The Secretary shall fur8 ther establish procedures to permit States to decline to

9 receive portions of such allocation during each fiscal year

10 as the State determines is appropriate and the Secretary

11 shall reallocate and distribute such allocation as the Sec12 retary deems appropriate and equitable.

13 (2) In the event of any drought, flood, hurricane, or

14 other natural disaster affecting substantial numbers of

15 persons in a State, county, or parish, the Secretary may

16 request that States unaffected by such a disaster consider

17 assisting affected States by allowing the Secretary to re18 allocate commodities from such unaffected State to States

19 containing areas adversely affected by the disaster.

20 (c) Purchases and distributions of commodities under

21 this title shall be made by the Secretary at such times

22 and under such conditions as the Secretary determines ap23 propriate within each fiscal year. All commodities so pur24 chased and distributed for each such fiscal year shall be

25 delivered at reasonable intervals to States based on the
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1 allocations and reallocations made under subsections (a)

2 and (b), and purchases made to carry out section 110,

3 before the end of such fiscal year.

4 SEC. 106. PRIORITY SYSTEM FOR STATE DISTRIBUTION OF

5 COMMODITIES.

6 (a) In distributing commodities under this title, ex7 cluding those commodities distributed in accordance with

8 section 110, the State agency, under procedures deter9 mined by the State agency, shall offer, or otherwise make

10 available, its full allocation of commodities for distribution

11 to emergency feeding organizations.

12 (b) If the State agency determines that the State will

13 not exhaust its allocation of commodities under this title

14 through distribution to organizations referred to in sub15 section (a), its remaining allocation of commodities under

16 this title shall be distributed to charitable institutions de17 scribed in section 113(3) not receiving commodities under

18 subsection (a).

19 (c) If the State agency determines that the State will

20 not exhaust its allocation of commodities under this title

21 through distribution to organizations referred to in sub22 sections (a) and (b), its remaining allocation of commod23 ities under this title shall be distributed to any eligible

24 recipient agency not receiving commodities under sub25 sections (a) and (b).
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1 SEC. 107. INITIAL PROCESSING COSTS.

2 The Secretary may use funds of the Commodity

3 Credit Corporation or funds available under section 32 of

4 the Act of August 24, 1935 (7 U.S.C. 612c), to pay the

5 costs of initial processing and packaging of commodities

6 to be distributed under the program established under this

7 title into forms and in quantities suitable, as determined

8 by the Secretary, for use by the individual households or

9 eligible recipient agencies, as applicable. The Secretary

10 may pay such costs in the form of Corporation-owned com11 modities equal in value to such costs. The Secretary shall

12 ensure that any such payments in kind will not displace

13 commercial sales of such commodities.

14 SEC. 108. ASSURANCES; ANTICIPATED USE.

15 (a) The Secretary shall take such precautions as the

16 Secretary deems necessary to ensure that commodities

17 made available under this title will not displace commer18 cial sales of such commodities or the products thereof. The

19 Secretary shall submit to Congress by December 31, 1997,

20 and not less than every two years thereafter, a report as

21 to whether and to what extent such displacements or sub22 stitutions are occurring.

23 (b) The Secretary shall determine that commodities

24 provided under this title shall be purchased and distrib25 uted only in quantities that can be consumed without

26 waste. No eligible recipient agency may receive commod-
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1 ities under this title in excess of anticipated use, based

2 on inventory records and controls, or in excess of its ability

3 to accept and store such commodities.

4 SEC. 109. AUTHORIZATION OF APPROPRIATIONS.

5 (a) PURCHASE OF COMMODITIES.—To carry out this

6 title, there are authorized to be appropriated

7 $260,000,000 for each of the fiscal years 1996 through

8 2000 to purchase, process and distribute commodities to

9 the States in accordance with this title.

10 (b) ADMINISTRATIVE FUNDS.—(1) There are author11 ized to be appropriated $40,000,000 for each of the fiscal

12 years 1996 through 2000 for the Secretary to make avail13 able to the States for State and local payments for costs

14 associated with the distribution of commodities by eligible

15 recipient agencies under this title, excluding costs associ16 ated with the distribution of those commodities distributed

17 under section 110(b). Funds appropriated under this

18 paragraph for any fiscal year shall be allocated to the

19 States on an advance basis dividing such funds among the

20 States in the same proportions as the commodities distrib21 uted under this title for such fiscal year are allocated

22 among the States. If a State agency is unable to use all

23 of the funds so allocated to it, the Secretary shall reallo24 cate such unused funds among the other States.
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1 (2)(A) Each State shall make available in each fiscal

2 year to eligible recipient agencies in the State not less than

3 40 percent of the funds received by the State under para4 graph (1) for such fiscal year, as necessary to pay for,

5 or provide advance payments to cover, the direct expenses

6 of eligible recipient agencies for distributing commodities

7 to needy persons, but only to the extent such expenses are

8 actually so incurred by such recipient agencies.

9 (B) As used in this paragraph, the term ‘‘direct ex10 penses’’ includes—

11 (i) costs of transporting, storing, handling, re12 packaging, processing, and distributing commodities

13 incurred after such commodities are received by eli14 gible recipient agencies;

15 (ii) costs associated with determinations of eli16 gibility, verification, and documentation;

17 (iii) costs of providing information to persons

18 receiving commodities under this title concerning the

19 appropriate storage and preparation of such com20 modities; and

21 (iv) costs of recordkeeping, auditing, and other

22 administrative procedures required for participation

23 in the program under this title.

24 (C) If a State makes a payment, using State funds,

25 to cover direct expenses of eligible recipient agencies, the
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1 amount of such payment shall be counted toward the

2 amount a State must make available for direct expenses

3 of recipient agencies under this paragraph.

4 (3) States to which funds are allocated for a fiscal

5 year under this subsection shall submit financial reports

6 to the Secretary, on a regular basis, as to the use of such

7 funds. No such funds may be used by States or eligible

8 recipient agencies for costs other than those involved in

9 covering the expenses related to the distribution of com10 modities by eligible recipient agencies.

11 (4)(A) Except as provided in subparagraph (B), to

12 be eligible to receive funds under this subsection, a State

13 shall provide in cash or in kind (according to procedures

14 approved by the Secretary for certifying these in-kind con15 tributions) from non-Federal sources a contribution equal

16 to the difference between—

17 (i) the amount of such funds so received; and

18 (ii) any part of the amount allocated to the

19 State and paid by the State—

20 (I) to eligible recipient agencies; or

21 (II) for the direct expenses of such recipi22 ent agencies;

23 for use in carrying out this title.

24 (B) Funds allocated to a State under this section

25 may, upon State request, be allocated before States satisfy
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1 the matching requirement specified in subparagraph (A),

2 based on the estimated contribution required. The Sec3 retary shall periodically reconcile estimated and actual

4 contributions and adjust allocations to the State to correct

5 for overpayments and underpayments.

6 (C) Any funds distributed for administrative costs

7 under section 110(b) shall not be covered by this para8 graph.

9 (5) States may not charge for commodities made

10 available to eligible recipient agencies, and may not pass

11 on to such recipient agencies the cost of any matching re12 quirements, under this title.

13 (c) The value of the commodities made available

14 under subsection (c) and (d) of section 102, and the funds

15 of the Corporation used to pay the costs of initial process16 ing, packaging (including forms suitable for home use),

17 and delivering commodities to the States shall not be

18 charged against appropriations authorized by this section.

19 SEC. 110. COMMODITY SUPPLEMENTAL FOOD PROGRAM.

20 (a) From the funds appropriated under section

21 109(a), $94,500,000 shall be used for each fiscal year to

22 purchase and distribute commodities to supplemental feed23 ing programs serving women, infants, and children or el24 derly individuals (hereinafter in this section referred to as
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1 the ‘‘commodity supplemental food program’’), or serving

2 both groups wherever located.

3 (b) Not more than 20 percent of the funds made

4 available under subsection (a) shall be made available to

5 the States for State and local payments of administrative

6 costs associated with the distribution of commodities by

7 eligible recipient agencies under this section. Administra8 tive costs for the purposes of the commodity supplemental

9 food program shall include, but not be limited to, expenses

10 for information and referral, operation, monitoring, nutri11 tion education, start-up costs, and general administration,

12 including staff, warehouse and transportation personnel,

13 insurance, and administration of the State or local office.

14 (c)(1) During each fiscal year the commodity supple15 mental food program is in operation, the types, varieties,

16 and amounts of commodities to be purchased under this

17 section shall be determined by the Secretary, but, if the

18 Secretary proposes to make any significant changes in the

19 types, varieties or amounts from those that were available

20 or were planned at the beginning of the fiscal year the

21 Secretary shall report such changes before implementation

22 to the Committee on Agriculture of the House of Rep23 resentatives and the Committee on Agriculture, Nutrition,

24 and Forestry of the Senate.
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1 (2) Notwithstanding any other provision of law, the

2 Commodity Credit Corporation shall, to the extent that

3 the Commodity Credit Corporation inventory levels per4 mit, provide not less than 9,000,000 pounds of cheese and

5 not less than 4,000,000 pounds of nonfat dry milk in each

6 of the fiscal years 1996 through 2000 to the Secretary.

7 The Secretary shall use such amounts of cheese and non8 fat dry milk to carry out the commodity supplemental food

9 program before the end of the fiscal year in which such

10 amounts are provided.

11 (d) The Secretary shall, in each fiscal year, approve

12 applications of additional sites for the program, including

13 sites that serve only elderly persons, in areas in which the

14 program currently does not operate, to the full extent that

15 applications can be approved within the appropriations

16 available for the program for the fiscal year and without

17 reducing actual participation levels (including participa18 tion of elderly persons under subsection (e)) in areas in

19 which the program is in effect.

20 (e) If a local agency that administers the commodity

21 supplemental food program determines that the amount

22 of funds made available to the agency to carry out this

23 section exceeds the amount of funds necessary to provide

24 assistance under such program to women, infants, and

25 children, the agency, with the approval of the Secretary,
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1 may permit low-income elderly persons (as defined by the

2 Secretary) to participate in and be served by such pro3 gram.

4 (f)(1) If it is necessary for the Secretary to pay a

5 significantly higher than expected price for one or more

6 types of commodities purchased under this section, the

7 Secretary shall promptly determine whether the price is

8 likely to cause the number of persons that can be served

9 in the program in a fiscal year to decline.

10 (2) If the Secretary determines that such a decline

11 would occur, the Secretary shall promptly notify the State

12 agencies charged with operating the program of the de13 cline and shall ensure that a State agency notify all local

14 agencies operating the program in the State of the decline.

15 (g) Commodities distributed to States pursuant to

16 this section shall not be considered in determining the

17 commodity allocation to each State or priority of distribu18 tion under sections 105 and 106.

19 SEC. 111. COMMODITIES NOT INCOME.

20 Notwithstanding any other provision of law, commod21 ities distributed under this title shall not be considered

22 income or resources for any purposes under any Federal,

23 State, or local law.
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1 SEC. 112. PROHIBITION AGAINST CERTAIN STATE

2 CHARGES.

3 Whenever a commodity is made available without

4 charge or credit under any nutrition program adminis5 tered by the Secretary for distribution within the States

6 to eligible recipient agencies, the State may not charge re7 cipient agencies any amount that is in excess of the State’s

8 direct costs of storing, and transporting to recipient agen9 cies the commodities minus any amount the Secretary pro10 vides the State for the costs of storing and transporting

11 such commodities.

12 SEC. 113. DEFINITIONS.

13 As used in this title:

14 (1) The term ‘‘average monthly number of un15 employed persons’’ means the average monthly num16 ber of unemployed persons within a State in the

17 most recent fiscal year for which such information is

18 available as determined by the Bureau of Labor Sta19 tistics of the Department of Labor.

20 (2) The term ‘‘elderly persons’’ means individ21 uals sixty years of age or older.

22 (3) The term ‘‘eligible recipient agency’’ means

23 a public or nonprofit organization that admin24 isters—

25 (A) an institution providing commodities to

26 supplemental feeding programs serving women,
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1 infants, and children or serving elderly persons,

2 or serving both groups;

3 (B) an emergency feeding organization;

4 (C) a charitable institution (including hos5 pitals and retirement homes and excluding

6 penal institutions) to the extent that such insti7 tution serves needy persons;

8 (D) a summer camp for children, or a

9 child nutrition program providing food service;

10 (E) a nutrition project operating under the

11 Older Americans Act of 1965, including such

12 projects that operate a congregate nutrition site

13 and project that provides home-delivered meals;

14 or

15 (F) a disaster relief program;

16 and that have been designated by the appropriate

17 State agency, or by the Secretary, and approved by

18 the Secretary for participation in the program estab19 lished under this title.

20 (4) The term ‘‘emergency feeding organization’’

21 means a public or nonprofit organization that administers

22 activities and projects (including the activities and

23 projects of a charitable institution, a food bank, a food

24 pantry, a hunger relief center, a soup kitchen, or a similar

25 public or private nonprofit eligible recipient agency) pro-
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1 viding nutrition assistance to relieve situations of emer2 gency and distress through the provision of food to needy

3 persons, including low-income and unemployed persons.

4 (5) The term ‘‘food bank’’ means a public and

5 charitable institution that maintains an established

6 operation involving the provision of food or edible

7 commodities, or the products thereof, to food pan8 tries, soup kitchens, hunger relief centers, or other

9 food or feeding centers that, as an integral part of

10 their normal activities, provide meals or food to feed

11 persons on a regular basis.

12 (6) The term ‘‘food pantry’’ means a public or

13 private nonprofit organization that distributes food

14 to low-income and unemployed households, including

15 food from sources other than the Department of Ag16 riculture, to relieve situations of emergency and dis17 tress.

18 (7) The term ‘‘needy persons’’ means—

19 (A) individuals who have low incomes or

20 who are unemployed, as determined by the

21 State (in no event shall the income of such indi22 vidual or household exceed 185 percent of the

23 poverty line);

24 (B) households certified as eligible to par25 ticipate in the food stamp program under the
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1 Food Stamp Act of 1977 (7 U.S.C. 2011 et

2 seq.); or

3 (C) individuals or households participating

4 in any other Federal, or federally assisted,

5 means-tested program.

6 (8) The term ‘‘poverty line’’ has the same

7 meaning given such term in section 673(2) of the

8 Community Services Block Grant Act (42 U.S.C.

9 9902(2)).

10 (9) The term ‘‘soup kitchen’’ means a public

11 and charitable institution that, as integral part of its

12 normal activities, maintains an established feeding

13 operation to provide food to needy homeless persons

14 on a regular basis.

15 SEC. 114. REGULATIONS.

16 (a) The Secretary shall issue regulations with one

17 hundred and twenty days to implement this title.

18 (b) In administering this subtitle, the Secretary shall

19 minimize, to the maximum extent practicable, the regu20 latory, recordkeeping, and paperwork requirements im21 posed on eligible recipient agencies.

22 (c) The Secretary shall as early as feasible but not

23 later than the beginning of each fiscal year, publish in the

24 Federal Register a nonbinding estimate of the types and

25 quantities of commodities that the Secretary anticipates
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1 are likely to be made available under the commodity dis2 tribution program under this title during the fiscal year.

3 (d) The regulations issued by the Secretary under

4 this section shall include provisions that set standards

5 with respect to liability for commodity losses for the com6 modities distributed under this title in situations in which

7 there is no evidence of negligence or fraud, and conditions

8 for payment to cover such losses. Such provisions shall

9 take into consideration the special needs and cir10 cumstances of eligible recipient agencies.

11 SEC. 115. FINALITY OF DETERMINATIONS.

12 Determinations made by the Secretary under this

13 title and the facts constituting the basis for any donation

14 of commodities under this title, or the amount thereof,

15 when officially determined in conformity with the applica16 ble regulations prescribed by the Secretary, shall be final

17 and conclusive and shall not be reviewable by any other

18 officer or agency of the Government.

19 SEC. 116. RELATIONSHIP TO OTHER PROGRAMS.

20 (a) Section 4(b) of the Food Stamp Act of 1977 (7

21 U.S.C. 2013(b)) shall not apply with respect to the dis22 tribution of commodities under this title.

23 (b) Except as otherwise provided in section 107, none

24 of the commodities distributed under this title shall be sold
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1 or otherwise disposed of in commercial channels in any

2 form.

3 SEC. 117. SETTLEMENT AND ADJUSTMENT OF CLAIMS.

4 (a) The Secretary, or a designee of the Secretary,

5 shall have the authority to—

6 (1) determine the amount of, settle, and adjust

7 any claim arising under this title; and

8 (2) waive such a claim if the Secretary deter9 mines that to do so will serve the purposes of this

10 title.

11 (b) Nothing contained in this section shall be con12 strued to diminish the authority of the Attorney General

13 of the United States under section 516 of title 28, United

14 States Code, to conduct litigation on behalf of the United

15 States.

16 SEC. 118. REPEALERS; AMENDMENTS.

17 (a) The Emergency Food Assistance Act of 1983 (7

18 U.S.C. 612c note) is repealed.

19 (b) AMENDMENTS.—

20 (1) The Hunger Prevention Act of 1988 (7

21 U.S.C. 612c note) is amended—

22 (A) by striking section 110; and

23 (B) by striking section 502.
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1 (2) The Commodity Distribution Reform Act

2 and WIC Amendments of 1987 (7 U.S.C. 612c note)

3 is amended by striking section 4.

4 (3) The Charitable Assistance and Food Bank

5 Act of 1987 (7 U.S.C. 612c note) is amended by

6 striking section 3.

7 (4) The Food Security Act of 1985 (7 U.S.C.

8 612c note) is amended—

9 (A) by striking section 1562(a) and section

10 1571; and

11 (B) in section 1562(d), by striking ‘‘sec12 tion 4 of the Agricultural and Consumer Pro13 tection Act of 1973’’ and inserting ‘‘section 110

14 of the American Commodity Distribution Act of

15 1995’’.

16 (5) The Agricultural and Consumer Protection

17 Act of 1973 (7 U.S.C. 612c note) is amended—

18 (A) in section 4(a), by striking ‘‘institu19 tions (including hospitals and facilities caring

20 for needy infants and children), supplemental

21 feeding programs serving women, infants and

22 children or elderly persons, or both, wherever

23 located, disaster areas, summer camps for chil24 dren,’’;
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1 (B) in subsection 4(c), by striking ‘‘the

2 Emergency Food Assistance Act of 1983’’ and

3 inserting ‘‘the Commodity Distribution Act of

4 1995’’; and

5 (C) by striking section 5.

6 (6) The Food, Agriculture, Conservation, and

7 Trade Act of 1990 (7 U.S.C. 612c note) is amended

8 by striking section 1773(f).

9 TITLE II—SIMPLIFICATION AND

10 REFORM OF FOOD STAMP

11 PROGRAM

12 SEC. 201. SHORT TITLE.

13 This title may be cited as the ‘‘Food Stamp Sim14 plification and Reform Act of 1995’’.

15 Subtitle A—Simplified Food Stamp

16 Program and State Assistance

17 for Needy Families

18 SEC. 202. ESTABLISHMENT OF SIMPLIFIED FOOD STAMP

19 PROGRAM AND STATE ASSISTANCE FOR

20 NEEDY FAMILIES PROGRAM.

21 Section 4(a) of the Food Stamp Act of 1977 (7

22 U.S.C. 2013(a)) is amended—

23 (1) in the first sentence, by striking, by striking

24 ‘‘Act,’’ and inserting ‘‘Act—’’;
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1 (2) beginning with ‘‘the Secretary is author2 ized’’, redesignating it as paragraph (1); and

3 (3) by adding the following new paragraph:

4 ‘‘(2) At the request of the State agency, a State

5 may operate a program, within the State or any po6 litical subdivisions within the State, in which house7 holds with one or more members receive regular cash

8 benefits under the program established by the State

9 under the Temporary Assistance for needy Families

10 block grant may, as provided in section 24, may be

11 issued monthly allotments following the rules and

12 procedures established by the State under the Tem13 porary Assistance for Needy Families block grant or

14 this Act.’’.

15 SEC. 203. SIMPLIFIED FOOD STAMP PROGRAM.

16 (a) The Act (7 U.S.C. 2011 et seq.) is amended by

17 adding the following new section:

18 ‘‘SEC. 24. SIMPLIFIED FOOD STAMP PROGRAM.

19 ‘‘(a) Where a State elects to operate a program under

20 section 4(a)(2) within the State or any political subdivi21 sions within the State, except as provided in subsection

22 (h), households in which all members receive regular cash

23 benefits under the program established by the State under

24 the Temporary Assistance for Needy Families block grant

25 shall be automatically eligible for the food stamp program
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1 and benefits shall be determined under the rules and pro2 cedures established by the State or political subdivision

3 under the Temporary Assistance for Needy Families block

4 grant or this Act, subject to subsection (h).

5 ‘‘(b) In approving a State plan to carry out such pro6 gram, the Secretary shall certify that the average food

7 stamp benefit level per household participating in the pro8 gram under this section for the State or political subdivi9 sion in which such program is in operation is not expected

10 to exceed the average level of food stamp benefits per

11 household that received benefits under part A of title IV

12 of the Social Security Act (42 U.S.C. 601 et seq.) in such

13 area in the preceding fiscal year, adjusted for any changes

14 in the thrifty food plan under section 3(o). The Secretary

15 shall compute the permissible average level of benefits per

16 household each year for each State or political subdivision

17 in which such program is in operation and may require

18 a State to report any information necessary to make such

19 computation.

20 ‘‘(c) Where average allotments provided by the State

21 under such program exceed the permissible level of bene22 fits per household for the State or political subdivision in

23 which the program is in operation, the State or political

24 subdivision shall repay the Secretary the value of the allot-
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1 ments in excess of the average level of benefits per house2 hold in the State or political subdivision.

3 ‘‘(d) The administrative costs for households in such

4 program shall be shared in accordance with section 16,

5 except that the Secretary shall pay an amount equal to

6 60 percent of all these administrative costs.

7 ‘‘(e)(1) A household against which a penalty is im8 posed (including disqualification) for noncompliance with

9 the program established by the State under the Tem10 porary Assistance for Needy Families block grant, except

11 as provided in paragraph (2), shall have the same penalty

12 imposed against it (including disqualification) in the pro13 gram administered under this section.

14 ‘‘(2) Where the penalty for noncompliance with the

15 program established by the State under the Temporary

16 Assistance for Needy Families block grant is a reduction

17 in benefits in such program, the household shall not re18 ceive an increased allotment as a result of a decrease in

19 the household’s income (as determined by the State under

20 this section) to the extent that the decrease is the result

21 of such penalty.

22 ‘‘(3) Any household disqualified from this program

23 under this subsection may, after such disqualification pe24 riod has expired, reapply for food stamp benefits under

25 this Act and shall be treated as a new applicant.
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1 ‘‘(f) Where a State or political subdivision, at its op2 tion, operates a program under this section for households

3 that include any members who do not participate in the

4 program established by the State under the Temporary

5 Assistance for Needy Families block grant, the Secretary

6 shall ensure that the State plan provides that household

7 eligibility shall be determined under this Act and benefits

8 may be determined under the rules and procedures estab9 lished by the State under the Temporary Assistance for

10 Needy Families block grant or this Act, and provides that

11 an equitable distribution of benefits among all household

12 members.

13 ‘‘(g)(1) At the election of the State, the State may

14 use the sums that would otherwise be allotted to house15 holds participating under this section for the purposes of

16 paying such households cash assistance where a member

17 of such household is employed as provided by paragraph

18 (2).

19 ‘‘(2) The State, in electing to provide cash assistance

20 under paragraph (1), at a minimum shall require—

21 ‘‘(A) the household has earned income of at

22 least $350 per month;

23 ‘‘(B) the source of such earned income is a pri24 vate sector employer, as determined by the State;

25 and
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1 ‘‘(C) the household has received such earned in2 come from the same employer for three consecutive

3 months.

4 ‘‘(3) If a State that makes the election described in

5 paragraph (1) informs the Secretary of the households re6 ceiving cash assistance under this subsection that partici7 pate in the program under this subsection—

8 ‘‘(A) the Secretary shall pay to the State an

9 amount equal to the value of the allotment that the

10 household is eligible to receive under this subsection;

11 ‘‘(B) the State shall provide such amount to the

12 household as cash assistance in lieu of the allotment

13 that the household would receive but for the oper14 ation of this subsection;

15 ‘‘(C) the amount of cash assistance received

16 under this subsection shall be considered as the

17 value of an allotment provided to the household; and

18 ‘‘(D) the household shall not receive an allot19 ment from the State agency for the period during

20 which the member continues to receive cash assist21 ance under this subsection.

22 ‘‘(4)(A) A State that makes the election in paragraph

23 (1) shall increase the cash benefits provided to households

24 under this subsection to compensate for any State or local

25 sales tax that may be collected on purchases of food by
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1 any household receiving cash benefits under this sub2 section, or the Secretary determines on the basis of infor3 mation provided by the State agency that the increase is

4 unnecessary on the basis of the limited nature of the items

5 subject to the State or local sales tax; and

6 ‘‘(B) the State pays the cost of any increased allot7 ment.

8 ‘‘(5) After the operation of the program under this

9 subsection for two years, the State shall conduct and pro10 vide the Committee on Agriculture of the House of Rep11 resentatives, the Committee on Agriculture, Nutrition, and

12 Forestry of the Senate, and the Secretary a written eval13 uation on the impact of cash assistance under this sub14 section.

15 ‘‘(h) Notwithstanding the provisions of this Act, in

16 operating such program, the State or political subdivisions

17 may follow the rules and procedures established by the

18 State or political subdivisions under the Temporary As19 sistance for Needy Families block grant or this Act, except

20 that the State or political subdivisions shall follow—

21 ‘‘(1) section 7 (a)–(g), issuance and use of cou22 pons;

23 ‘‘(2) section 8(a), value of allotment, except

24 that the household’s income may be determined

25 under the program established by the State under
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1 the Temporary Assistance for Needy Families block

2 grant;

3 ‘‘(3) section 8(b), allotment not considered in4 come or resources;

5 ‘‘(4) section 11 (a), (c)–(d), and (n), adminis6 tration;

7 ‘‘(5) under section 11(e), the State shall follow

8 paragraphs (8), (12), (17), (19), (21), (26)–(27);

9 ‘‘(6) section 11(e)(10) or a comparable provi10 sion established by the State under the Temporary

11 Assistance for Needy Families block grant; and

12 ‘‘(7) section 16, administrative cost-sharing and

13 quality control, except as provided in subsection

14 (c).’’.

15 (b) Section 11(e) of the Act (7 U.S.C. 2020(e)) is

16 amended inserting at the end the following new para17 graph:

18 ‘‘(26) the plans of the State agency, at the elec19 tion of the State, for operating a program under sec20 tion (4)(a)(2), including—

21 ‘‘(A) the rules and procedures to be fol22 lowed by the State to determine benefits;

23 ‘‘(B) whether the program operated by the

24 State under section 4(a)(2) will include house25 holds including members who do not participate
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1 in the program established by the State under

2 the Temporary Assistance for Needy Families

3 block grant; and

4 ‘‘(C) the method by which the State or po5 litical subdivision will carry out a quality con6 trol system under section 16(c).’’.

7 SEC. 204. CONFORMING AMENDMENTS.

8 (a) Section 8 of the Act (7 U.S.C. 2017) is amended

9 by striking subsection (e).

10 (b) Section 17 of the Act (7 U.S.C. 2026) is amend11 ed—

12 (1) by striking subsection (i);

13 (2) by redesignating subsections (j), (k), and (l)

14 as subsections (i), (j), and (k), respectively.

15 Subtitle B—Food Stamp Program

16 SEC. 205. INCOME DEDUCTIONS AND ENERGY ASSISTANCE.

17 (a) Section 5(d)(11) of the Act (7 U.S.C.

18 2014(d)(11)) is amended—

19 (1) by striking ‘‘(A)’’; and

20 (2) by striking ‘‘or (B) under any State or local

21 laws,’’ and all that follows through ‘‘or impracticable

22 to do so,’’.

23 (b) Section 5(e) of the Act (7 U.S.C. 2014(e)) is

24 amended to read as follows:
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1 ‘‘(e)(1) STANDARD AND EARNED INCOME DEDUC2 TIONS.—

3 ‘‘(A) In computing household income, the Sec4 retary shall allow a standard deduction of $134 a

5 month for each household, except that households in

6 Alaska, Hawaii, Guam, and the Virgin Islands of the

7 United States shall be allowed a standard deduction

8 of $229, $189, $269, and $118, respectively.

9 ‘‘(B) All households with earned income shall

10 also be allowed an additional deduction of 20 per11 cent of all earned income (other than that excluded

12 by subsection (d) of this section and that earned

13 under section 16(j)), to compensate for taxes, other

14 mandatory deductions from salary, and work ex15 penses, except that such additional deduction shall

16 not be allowed with respect to earned income that a

17 household willfully or fraudulently fails (as proven

18 in a proceeding provided for in section 6(b)) to re19 port in a timely manner.

20 ‘‘(2) DEPENDENT CARE DEDUCTION.—The Sec21 retary shall allow households, a deduction with respect to

22 expenses other than expenses paid on behalf of the house23 hold by a third party or benefits paid to the household,

24 directly or indirectly, under the Temporary Assistance for

25 Needy Families block grant, amounts made available and
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1 excluded for the expenses under subsection (d)(3), the

2 maximum allowable level of which shall be $200 a month

3 for each dependent child under two years of age and $175

4 a month for each other dependent, for the actual cost of

5 payments necessary for the care of a dependent when such

6 care enables a household member to accept or continue

7 employment, or training or education which is preparatory

8 for employment.

9 ‘‘(3) EXCESS SHELTER EXPENSE DEDUCTION.—

10 ‘‘(A) The Secretary shall allow households,

11 other than those households containing an elderly or

12 disabled member, with respect to expenses other

13 than expenses paid on behalf of the household by a

14 third party, an excess shelter expense deduction to

15 the extent that the monthly amount expended by a

16 household for shelter exceeds an amount equal to 50

17 percent of monthly household income after all other

18 applicable deductions have been allowed.

19 ‘‘(B) Such excess shelter expense deduction

20 shall not exceed $231 a month in the forty-eight

21 contiguous States and the District of Columbia, and

22 shall not exceed, in Alaska, Hawaii, Guam, and the

23 Virgin Islands of the United States, $402, $330,

24 $280, and $171 a month, respectively.
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1 ‘‘(C) Notwithstanding section 2605(f) of the

2 Low-Income Home Energy Assistance Act of 1981

3 (42 U.S.C. 8624(f)), a State agency may allow a de4 duction for heating and cooling expenses only to the

5 extent that the household still incurs out-of-pocket

6 heating or cooling expenses in addition to any pay7 ment received under, or costs paid on its behalf, the

8 Low-Income Home Energy Assistance Act of 1981

9 (42 U.S.C. 8621 et seq.). For purposes of the food

10 stamp program, assistance provided under the Low11 Income Home Energy Assistance Act of 1981 shall

12 be considered to be prorated over the entire heating

13 or cooling season for which it was provided. A State

14 agency shall allow a household to switch between

15 any standard utility allowance and a deduction based

16 on its actual utility costs at the end of any certifi17 cation period and up to one additional time during

18 each twelve-month period.

19 ‘‘(D) In computing the excess shelter expense

20 deduction, a State agency may use a standard utility

21 allowance in accordance with regulations promul22 gated by the Secretary, except that a State agency

23 may use an allowance which does not fluctuate with24 in a year to reflect seasonal variations.
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1 ‘‘(i) An allowance for a heating or cooling

2 expense may not be used for a household that

3 does not incur a heating or cooling expense, as

4 the case may be, or does incur a heating or

5 cooling expense but is located in a public hous6 ing unit which has central utility meters and

7 charges households, with regard to such ex8 pense, only for excess utility costs.

9 ‘‘(ii) No such allowance may be used for a

10 household that shares such expense with, and

11 lives with, another individual not participating

12 in the food stamp program, another household

13 participating in the food stamp program, or

14 both, unless the allowance is prorated between

15 the household and the other individual, house16 hold, or both.

17 ‘‘(4) HOMELESS SHELTER DEDUCTION.—The Sec18 retary shall allow households in which all members are

19 homeless but are not receiving free shelter throughout the

20 month a shelter expense deduction for the expenses that

21 may reasonably be expected to be incurred by such house22 holds, but such deduction shall not exceed $139 a month.

23 ‘‘(5) ELDERLY AND DISABLED.—The Secretary shall

24 allow households containing an elderly or disabled mem-
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1 ber, with respect to expenses other than expenses paid on

2 behalf of the household by a third party, to—

3 ‘‘(A) an excess medical expense deduction for

4 that portion of the actual cost of allowable medical

5 expenses, incurred by elderly or disabled members,

6 exclusive of special diets, that exceed $35 a month;

7 and

8 ‘‘(B) an excess shelter expense deduction to the

9 extent that the monthly amount expended by a

10 household for shelter exceeds an amount equal to 50

11 percent of monthly household income after all other

12 applicable deductions have been allowed.

13 State agencies shall offer eligible households a method of

14 claiming a deduction for recurring medical expenses that

15 are initially verified under the excess medical expense de16 duction provided for in subparagraph (A), in lieu of sub17 mitting information or verification on actual expenses on

18 a monthly basis. The method described in the preceding

19 sentence shall be designed to minimize the administrative

20 burden for eligible elderly and disabled household mem21 bers choosing to deduct their recurrent medical expenses

22 pursuant to such method, shall rely on reasonable esti23 mates of the member’s expected medical expenses for the

24 certification period (including changes that can be reason25 ably anticipated based on available information about the
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1 member’s medical condition, public or private medical in2 surance coverage, and the current verified medical ex3 penses incurred by the member), and shall not require fur4 ther reporting or verification of a change in medical ex5 penses if such a change has been anticipated for the cer6 tification period.

7 ‘‘(6) CHILD SUPPORT DEDUCTION.—Before deter8 mining the excess shelter expense deduction, the Secretary

9 shall allow all households a deduction for child support

10 payments made by a household member to or for an indi11 vidual who is not a member of the household if such house12 hold member was legally obligated to make such payments,

13 except that the Secretary is authorized to prescribe by reg14 ulation the methods, including calculation on a retrospec15 tive basis, that State agencies shall use to determine the

16 amount of the deduction for child support payments.’’.

17 (c) Section 11(e)(3) of the Act (7 U.S.C. 2020(e)(3))

18 is amended by striking ‘‘Under the rules prescribed by the

19 Secretary, a State agency shall develop standard esti20 mates’’ and all that follows through the second period.

21 SEC. 206. VEHICLE ALLOWANCE.

22 Section 5(g)(2) of the Act (7 U.S.C. 2014(f)(2)) is

23 amended by striking ‘‘a level set by the Secretary, which

24 shall be $4,500 through August 31, 1994,’’ and all that
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1 follows through the end of subsection, and inserting

2 ‘‘$4,550.’’.

3 SEC. 207. ELIGIBILITY OF ALIENS.

4 (a) Section 5 of the Act (7 U.S.C. 2014) is amend5 ed—

6 (1) by striking subsection (i);

7 (2) by redesignating subsections (j) through

8 (m) as subsections (i) through (l), respectively; and

9 (3) by changing all references in the Act to re10 flect the amendment in paragraph (2) wherever they

11 occur.

12 (b) Section 6(f)(2) (7 U.S.C. 2015(f)(2)) is amend13 ed—

14 (1) in subparagraph (B), by inserting ‘‘, and

15 such alien has fulfilled the residence requirements,

16 and has an application pending, for naturalization

17 under the Immigration and Nationality Act, or is a

18 veteran (as defined in section 101 of title 38, United

19 States Code) with a discharge characterized as an

20 honorable discharge (or is spouse of such alien), or

21 is on active duty (other than active duty for train22 ing) in the Armed Forces of the United States (or

23 is the spouse or dependent child of such alien)’’ be24 fore the semicolon;
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1 (2) in subparagraph (D), by inserting ‘‘for five

2 years after such entry’’ before the semicolon.

3 SEC. 208. WORK REQUIREMENTS.

4 (a) Section 6(d) of the Act (42 U.S.C. 2015(d)) is

5 amended—

6 (1) in paragraph (1)(A)(i), by inserting ‘‘or re7 fuses to participate in any State job search pro8 gram’’ after ‘‘by the Secretary’’;

9 (2) in paragraph (2)—

10 (A) in subparagraph (A)—

11 (i) by inserting ‘‘part A of’’ after

12 ‘‘work registration requirement under’’;

13 (ii) by striking ‘‘that is comparable to

14 a requirement of paragraph (1)’’;

15 (B) by inserting ‘‘or’’ before ‘‘(E)’’; and

16 (C) by striking ‘‘; or (F) a person between

17 the ages of sixteen and eighteen who is not a

18 head of a household or who is attending school,

19 or enrolled in an employment training program,

20 on at least a half-time basis’’; and

21 (3) in paragraph (4), to read as follows:

22 ‘‘(4)(A) Except as provided in subparagraphs

23 (B), (C), and (D), an individual shall not be denied

24 initial eligibility but shall be disqualified from the

25 food stamp program if the individual has not been
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1 employed a minimum of twenty hours per week, or

2 did not participate in a workfare program estab3 lished under section 20, within 90 days of certifi4 cation of eligibility.

5 ‘‘(B) The provisions of subparagraph (A) shall

6 not apply in the case of an individual who—

7 ‘‘(i) is under eighteen or over fifty years of

8 age;

9 ‘‘(ii) is certified by a physician as phys10 ically or mentally unfit for employment;

11 ‘‘(iii) is a parent or other member of a

12 household with responsibility for the care of a

13 dependent;

14 ‘‘(iv) is participating a minimum of 20

15 hours per week and is in compliance with the

16 requirements of—

17 ‘‘(I) a program under the Job Train18 ing Partnership Act (29 U.S.C. 1501 et

19 seq.);

20 ‘‘(II) a program under section 236 of

21 the Trade Act of 1974 (19 U.S.C. 2296);

22 or

23 ‘‘(III) another program for the pur24 pose of employment and training operated
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1 by a State or local government, as deter2 mined appropriate by the Secretary; or

3 ‘‘(v) or would otherwise be exempt under

4 subsection (d)(2).

5 ‘‘(C) The Secretary may waive the requirements

6 of subparagraph (A) in the case of some or all indi7 viduals within all or part of State if the Secretary

8 finds that such area—

9 ‘‘(i) has an unemployment rate of over 10

10 percent; or

11 ‘‘(ii) does not have a sufficient number of

12 jobs to provide employment for individuals sub13 ject to this paragraph. The Secretary shall re14 port to the Committee on Agriculture of the

15 House of Representatives and the Committee

16 on Agriculture, Nutrition, and Forestry of the

17 Senate on the basis in which the Secretary

18 made this decision.

19 ‘‘(D) An individual who has been disqualified

20 from the food stamp program by reason of subpara21 graph (A) may reestablish eligibility for assistance

22 by—

23 ‘‘(i) becoming employed for a minimum of

24 twenty hours per week during any consecutive

25 thirty-day period; or
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1 ‘‘(ii) participating in a workfare program

2 established under section 20 or a comparable

3 workfare program established by the State or

4 local government during any consecutive thirty5 day period.’’.

6 (b) Section 16 of the Act (7 U.S.C. 2025) is amend7 ed—

8 (1) by striking subsection (h);

9 (2) by redesignating subsections (i) and (j) and

10 subsections (h) and (i), respectively; and

11 (3) by changing all references.

12 (c) Section 17 of the Act (7 U.S.C. 2026), as pre13 viously amended, is amended—

14 (1) by striking subsection (d);

15 (2) by redesignating subsections (e) through (k)

16 as subsections (d) through (j), respectively; and

17 (3) by changing all references in the Act to re18 flect the amendment in paragraph (2) whenever they

19 occur.

20 SEC. 209. COMPARABLE TREATMENT OF DISQUALIFIED IN21 DIVIDUALS.

22 Section 6 of the Act (7 U.S.C. 2015) is amended by

23 adding at the end the following new subsection:

24 ‘‘(i) An individual who is a member of

25 a household who would otherwise be eligi-
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1 ble to participate in the food stamp pro2 gram under this section who has been dis3 qualified from the program established by

4 the State under part A of title IV of the

5 Social Security Act (42 U.S.C. 601 et seq.)

6 shall not be eligible to participate in the

7 food stamp program during the period

8 such disqualification is in effect.’’.

9 SEC. 210. ENCOURAGE ELECTRONIC BENEFIT TRANSFER

10 SYSTEMS.

11 (a) Section 7(i) of the Act (7 U.S.C. 2016(i)(1)) is

12 amended—

13 (1) in paragraph (1), to read as follows:

14 ‘‘(A) State agencies are encouraged to im15 plement an on-line electronic benefit transfer

16 system in which household benefits determined

17 under section 8(a) or section 24 are issued from

18 and stored in a central data bank and electroni19 cally accessed by household members at the

20 point-of-sale.

21 ‘‘(B) Subject to paragraph (2), a State is

22 authorized to procure and implement an elec23 tronic benefit transfer system under the terms,

24 conditions, and design that the state deems ap25 propriate.
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1 ‘‘(C) The Secretary shall, upon request of

2 a State, waive any provision of this Act prohib3 iting the effective implementation of an elec4 tronic benefit transfer system under this sub5 section.’’;

6 (2) in paragraph (2), by striking ‘‘for the ap7 proval’’; and

8 (3) in paragraph (3), by striking ‘‘, the Sec9 retary shall not approve such a system unless’’.

10 (b) The Act (7 U.S.C. 2011 et seq.), as previously

11 amended by this Act, is amended by adding at the end

12 the following new section:

13 ‘‘SEC. 25. ENCOURAGEMENT OF ELECTRONIC BENEFIT

14 TRANSFER SYSTEMS.

15 ‘‘(a) Upon fully implementing an electronic benefit

16 transfer system which operates in the entire State, a State

17 may, subject to the provisions of this section, elect to oper18 ate a low-income nutrition assistance program in lieu of

19 the food stamp program established under this Act.

20 ‘‘(b)(1) Each State that meets the requirements of

21 this section and elects to receive such grants, shall receive

22 each fiscal year under this section the sum of—

23 ‘‘(A)(i) the total dollar value of all benefits is24 sued under the food stamp program by the State

25 during fiscal year 1994; or
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1 ‘‘(ii) the average for each fiscal year of the total

2 dollar value of all benefits issued under the food

3 stamp program by the State during fiscal years

4 1992 through 1994; and

5 ‘‘(B) the total amount received by the State for

6 administrative costs under section 16(a) for fiscal

7 year 1994 or the average for each fiscal year of the

8 total amount received for fiscal years 1992 through

9 1994.

10 ‘‘(2) If the Secretary approves the plan submitted by

11 a State under subsection (c), the Secretary shall pay to

12 the State at such times and in such manner as the Sec13 retary may determine, the amount to which the State is

14 eligible under subsection (b)(1).

15 ‘‘(c) To be eligible to receive a grant under this sec16 tion, a State shall submit for approval each fiscal year

17 a plan of operation specifying the manner in which such

18 a program will be conducted by the State. Such plan

19 shall—

20 ‘‘(1) certify that the State has implemented a

21 statewide electronic benefit transfer system in ac22 cordance with section 7(i);

23 ‘‘(2) designate a single State agency responsible

24 for the administration of the nutrition assistance

25 program under this section;
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1 ‘‘(3) assess the food and nutrition needs of

2 needy persons residing in the State;

3 ‘‘(4) limit the assistance to be provided to the

4 purchase of food and describe the persons to whom

5 such assistance will be provided;

6 ‘‘(5) assure the Secretary that assistance will be

7 provided to the most needy persons in the State and

8 that applicants for assistance shall have adequate

9 notice and fair hearings comparable to those re10 quired under section 11 of this Act;

11 ‘‘(6) provide that, in the operation of the nutri12 tion assistance program, there shall be no discrimi13 nation on the basis of race, sex, religious creed, na14 tional origin, or political beliefs; and

15 ‘‘(7) include other information as may be re16 quired by the Secretary.

17 ‘‘(d) Payments made under this section to the State

18 may be expended only in the fiscal year for which such

19 payments are distributed, except that the State may re20 serve up to five percent of the grant received each fiscal

21 year to provide assistance under this section in subsequent

22 years: Provided, That such reserved funds may not total

23 more than 20 percent of the total grant received under

24 this section in any fiscal year.
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1 ‘‘(e) The State agency shall keep records concerning

2 the operation of the program carried out under this sec3 tion and shall make such records available to the Secretary

4 and the Comptroller General of the United States.

5 ‘‘(f) If the Secretary finds that there is substantial

6 failure by a State to comply with the requirements of this

7 section, regulations issued pursuant to this section, or the

8 plan approved under subsection (c), then the Secretary

9 shall take one or more of the following actions:

10 ‘‘(1) Suspend all or part of such payment au11 thorized by subsection (b)(2) to be made available to

12 such State, until the Secretary determines the State

13 to be in substantial compliance with such require14 ments.

15 ‘‘(2) Withhold all or part of such payments

16 until the Secretary determines that there is no

17 longer failure to comply with such requirements, at

18 which time the withheld payment may be paid.

19 ‘‘(3) Terminate the authority of the State to

20 operate the low-income nutrition assistance program.

21 ‘‘(g)(1) States which receive grants under this section

22 shall provide for—

23 ‘‘(A) a biennial audit, conducted in accordance

24 with the standards of the Comptroller General, of
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1 expenditures for the provision of assistance under

2 this section; and

3 ‘‘(B) not later than 120 days of the end of each

4 fiscal year in which an audit is conducted, a report

5 to the Secretary containing the findings of such

6 audit.

7 States shall make the report of such audit available for

8 public inspection.

9 ‘‘(2) Not later than 120 days after the end of each

10 fiscal year, each such State shall prepare an activities re11 port comparing actual expenditures for such fiscal year

12 for assistance under this section with the expenditures for

13 such fiscal year predicted in the plan submitted in accord14 ance with subsection (c)(1) of this section. Such State

15 shall make the activities report available for public inspec16 tion.

17 ‘‘(h) Whoever knowingly and willfully embezzles,

18 misapplies, steals, or obtains by fraud, false statement, or

19 forgery, any funds, assets, or property provided or fi20 nanced under this section shall be fined not more than

21 $10,000 or imprisoned for not more than five years, or

22 both.

23 SEC. 211. VALUE OF MINIMUM ALLOTMENT.

24 Section 8(a) of Act (7 U.S.C. 2017(a)) is amended

25 by striking ‘‘, and shall be adjusted on each October 1’’
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1 and all that follows through the end of the subsection, and

2 inserting a period.

3 SEC. 212. INITIAL MONTH BENEFIT DETERMINATION.

4 Section 8(c)(2)(B) of the Act (7 U.S.C.

5 2017(c)(2)(B)) is amended by striking ‘‘of more than one

6 month’’ after ‘‘following any period’’.

7 SEC. 213. IMPROVING FOOD STAMP PROGRAM MANAGE8 MENT.

9 (a) Section 13(a)(1) of the Act (7 U.S.C. 2022(a)(1))

10 is amended—

11 (1) in the fifth sentence, by inserting ‘‘(after a

12 determination on any request for a waiver for good

13 cause related to the claim has been made by the Sec14 retary)’’ after ‘‘bill for collection’’;

15 (2) in the sixth sentence, by striking ‘‘1 year’’

16 and inserting ‘‘2 years’’.

17 (b) Section 14(a) of the Act (7 U.S.C. 2023(a)) is

18 amended—

19 (1) in the sixth sentence, by striking ‘‘(includ20 ing determinations as to whether there is good cause

21 for not imposing all or a portion of the penalty)’’;

22 (2) by adding at the end the following new sen23 tence: ‘‘Notwithstanding the administrative or judi24 cial review procedures set forth in this subsection,

25 determinations by the Secretary concerning whether
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1 a State agency had good cause for its failure to meet

2 error rate tolerance levels established under section

3 16(c) are final.’’.

4 (c) Section 16(c) of the Act (7 U.S.C. 2025(c)) is

5 amended—

6 (1) in paragraph (1)(C)—

7 (A) by striking ‘‘national performance

8 measure’’ and inserting ‘‘payment error toler9 ance level’’; and

10 (B) by striking ‘‘equal to—’’ and all that

11 follows through the first period and inserting

12 the following: ‘‘equal to its payment error rate

13 less such tolerance level times the total value of

14 allotments issued in such a fiscal year by such

15 State agency. The amount of liability shall not

16 be affected by corrective action under subpara17 graph (B).’’;

18 (2) in paragraph (3)(A), by striking ‘‘120 days’’

19 and inserting ‘‘60 days (or 90 days at the discretion

20 of the Secretary)’’;

21 (3) in the third sentence of paragraph (6), by

22 inserting ‘‘shall be used to establish a payment-error

23 tolerance level. Such tolerance level for any fiscal

24 year will be one percentage point added to the lowest

25 national performance measure ever announced up to
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1 and including such fiscal year under this section.

2 The payment-error tolerance level’’ after ‘‘The an3 nounced national performance measure’’; and

4 (4) by striking paragraphs (8) and (9).

5 SEC. 214. WORK SUPPLEMENTATION OF SUPPORT PRO6 GRAM.

7 (a) Section 11(e) of the Act (7 U.S.C. 2020(e)), as

8 previously amended by this Act, is amended by adding at

9 the end the following new paragraph:

10 ‘‘(27) the plans of the State agency for includ11 ing eligible food stamp recipients in a work

12 supplementation or support program under section

13 16(i).’’.

14 (b) Section 16 of the Act (7 U.S.C. 2025), as pre15 viously amended by this Act, is amended by adding at the

16 end the following new subsection:

17 ‘‘(i) WORK SUPPLEMENTATION OR SUPPORT PRO18 GRAM.—(1) At the election of the State, the State may

19 use the sums that would otherwise be allotted to partici20 pants under this Act for the purposes of providing and

21 subsidizing or supporting jobs under a work

22 supplementation or support program established by the

23 State under the Temporary Assistance for Needy Families

24 block grant.
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1 ‘‘(2) If a State agency of a State that makes the elec2 tion described in paragraph (1) informs the Secretary that

3 an individual who is participating in such work

4 supplementation or support program is a member of a

5 household that participates in the food stamp program—

6 ‘‘(A) the Secretary shall pay to the State an

7 amount equal to the value of the allotment that the

8 household is eligible to receive under this Act;

9 ‘‘(B) the State shall expend such amount in ac10 cordance with its work supplementation or support

11 program in lieu of the allotment that the household

12 would receive but for the operation of this sub13 section;

14 ‘‘(C) for purposes of—

15 ‘‘(i) sections 5 and 8(a) of this Act, the

16 amount received under this subsection shall be

17 excluded from household income and resources;

18 and

19 ‘‘(ii) section 8(b) of this Act, the amount

20 received under this subsection shall be consid21 ered as the value of an allotment provided to

22 the household; and

23 ‘‘(D) the household shall not receive an allot24 ment from the State agency for the period during
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1 which the member continues to participate in the

2 work supplementation program.

3 ‘‘(3) No person shall be excused by reason of the fact

4 that such State has a work supplementation or support

5 program from any work requirement under section 6(d),

6 except during the periods in which such individual is em7 ployed under such work supplementation or support pro8 gram.

9 ‘‘(4) For purposes of this subsection, ‘work

10 supplementation or support’ shall mean a program in

11 which, as determined by the Secretary, public assistance,

12 including any benefits provided under a program estab13 lished by the State under the Temporary Assistance for

14 Needy Families block grant and the food stamp program,

15 is provided to an employer to be used for hiring a public

16 assistance recipient.’’.

17 SEC. 215. EFFECTIVE DATES.

18 (a) Except as provided in subsections (b) and (c), this

19 Act and amendments made by this Act shall take effect

20 on October 1, 1995.

21 (b) The amendments made by section 207 shall take

22 effect on October 1, 1996.

23 (c) The amendments made by section 213 shall take

24 effect on October 1, 1994.

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