JOURNAL OF THE

438

T49.12 MARCH 23

NOES—5

Chenoweth

Cubin

Skaggs

Stupak

Watt (NC)

NOT VOTING—3

Bunn Meek Miller (FL)

So the amendment was agreed to.

After some further time,

T49.12 RECORDED VOTE

A recorded vote by electronic device

was ordered in the Committee of the

Whole on the following amendment in

the nature of a substitute submitted by

Mr. DEAL:

Strike out all after the enacting clause and

insert:

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Individual

Responsibility Act of 1995’’.

SEC. 2. TABLE OF CONTENTS.

The table of contents of this Act is as follows:

Sec. 1. Short title.

Sec. 2. Table of contents.

Sec. 3. Amendment of the Social Security

Act.

TITLE I—TIME-LIMITED TRANSITIONAL

ASSISTANCE

Sec. 101. Limitation on duration of AFDC

benefits.

Sec. 102. Establishment of Federal data

base.

TITLE II—MAKE WORK PAY

Subtitle A—Health Care

Sec. 201. Transitional medicaid benefits.

Subtitle B—Earned Income Tax Credit

Sec. 211. Notice of availability required to

be provided to applicants and

former recipients of AFDC, food

stamps, and medicaid.

Sec. 212. Notice of availability of earned income tax credit and dependent

care tax credit to be included

on W–4 form.

Sec. 213. Advance payment of earned income

tax credit through State demonstration programs.

Subtitle C—Child Care

Sec. 221. Dependent care credit to be refundable; high-income taxpayers ineligible for credit.

Sec. 222. Funding of child care services.

Subtitle D—AFDC Work Disregards

Sec. 231. Option to increase disregard of

earned income.

Sec. 232. State option to establish voluntary

diversion program.

Sec. 233. Elimination of quarters of coverage

requirement for married teens

under AFDC–UP program.

Subtitle E—AFDC Asset Limitations

Sec. 241. Increase in resource thresholds;

separate threshold for vehicles.

Sec. 242. Limited disregard of amounts saved

for post-secondary education,

the purchase of a first home, or

the establishment or operation

of a microenterprise.

TITLE III—THE WORK FIRST PROGRAM

Sec. 301. Work first program.

Sec. 302. Regulations.

Sec. 303. Applicability to States.

Sec. 304. Sense of the Congress relating to

availability of work first program in rural areas.

Sec. 305. Grants to community-based organizations.

TITLE IV—FAMILY RESPONSIBILITY

AND IMPROVED CHILD SUPPORT ENFORCEMENT

Subtitle A—Eligibility and Other Matters

Concerning Title IV–D Program Clients

Sec. 401. State obligation to provide paternity establishment and child

support enforcement services.

Sec. 402. Distribution of payments.

Sec. 403. Due process rights.

Sec. 404. Privacy safeguards.

Subtitle B—Program Administration and

Funding

Sec. 411. Federal matching payments.

Sec. 412. Performance-based incentives and

penalties.

Sec. 413. Federal and State reviews and audits.

Sec. 414. Required reporting procedures.

Sec. 415. Automated data processing requirements.

Sec. 416. Director of CSE program; staffing

study.

Sec. 417. Funding for secretarial assistance

to State programs.

Sec. 418. Reports and data collection by the

Secretary.

Subtitle C—Locate and Case Tracking

Sec. 421. Central State and case registry.

Sec. 422. Centralized collection and disbursement of support payments.

Sec. 423. Amendments concerning income

withholding.

Sec. 424. Locator information from interstate networks.

Sec. 425. Expanded Federal Parent Locator

Service.

Sec. 426. Use of social security numbers.

Subtitle D—Streamlining and Uniformity of

Procedures

Sec. 431. Adoption of uniform State laws.

Sec. 432. Improvements to full faith and

credit for child support orders.

Sec. 433. State laws providing expedited procedures.

Subtitle E—Paternity Establishment

Sec. 441. Sense of the Congress.

Sec. 442. Availability of parenting social

services for new fathers.

Sec. 443. Cooperation requirement and good

cause exception.

Sec. 444. Federal matching payments.

Sec. 445. Performance-based incentives and

penalties.

Sec. 446. State laws concerning paternity establishment.

Sec. 447. Outreach for voluntary paternity

establishment.

Subtitle F—Establishment and Modification

of Support Orders

Sec. 451. National Child Support Guidelines

Commission.

Sec. 452. Simplified process for review and

adjustment of child support orders.

Subtitle G—Enforcement of Support Orders

Sec. 461. Federal income tax refund offset.

Sec. 462. Internal Revenue Service collection of arrears.

Sec. 463. Authority to collect support from

Federal employees.

Sec. 464. Enforcement of child support obligations of members of the

Armed Forces.

Sec. 465. Motor vehicle liens.

Sec. 466. Voiding of fraudulent transfers.

Sec. 467. State law authorizing suspension of

licenses.

Sec. 468. Reporting arrearages to credit bureaus.

Sec. 469. Extended statute of limitation for

collection of arrearages.

Sec. 470. Charges for arrearages.

Sec. 471. Denial of passports for nonpayment

of child support.

Sec. 472. International child support enforcement.

Sec. 473. Seizure of lottery winnings, settlements, payouts, awards, and bequests, and sale of forfeited

property, to pay child support

arrearages.

Sec. 474. Liability of grandparents for financial support of children of their

minor children.

Sec. 475. Sense of the Congress regarding

programs for noncustodial parents unable to meet child support obligations.

Subtitle H—Medical Support

Sec. 481. Technical correction to ERISA definition of medical child support

order.

Sec. 482. Extension of medicaid eligibility

for families losing AFDC due to

increased child support collections.

Subtitle I—Effect of Enactment

Sec. 491. Effective dates.

Sec. 492. Severability.

TITLE V—TEEN PREGNANCY AND

FAMILY STABILITY

Subtitle A—Federal Role

Sec. 501. State option to deny AFDC for additional children.

Sec. 502. Minors receiving AFDC required to

live under responsible adult supervision.

Sec. 503. National clearinghouse on adolescent pregnancy.

Sec. 504. Incentive for teen parents to attend

school.

Sec. 505. State option to disregard 100–hour

rule under AFDC–UP program.

Sec. 506. State option to disregard 6–month

limitation on AFDC–UP benefits.

Sec. 507. Elimination of quarters of coverage

requirement under AFDC–UP

program for families in which

both parents are teens.

Sec. 508. Denial of Federal housing benefits

to minors who bear children

out-of-wedlock.

Sec. 509. State option to deny AFDC to

minor parents.

Subtitle B—State Role

Sec. 511. Teenage pregnancy prevention and

family stability.

Sec. 512. Availability of family planning

services.

TITLE VI—PROGRAM SIMPLIFICATION

Subtitle A—Increased State Flexibility

Sec. 601. State option to provide AFDC

through electronic benefit

transfer systems.

Sec. 602. Deadline for action on application

for waiver of requirement applicable to program of aid to families with dependent children.

Subtitle B—Coordination of AFDC and Food

Stamp Programs

Sec. 611. Amendments to part A of title IV

of the Social Security Act.

Sec. 612. Amendments to the Food Stamp

Act of 1977.

Subtitle C—Fraud Reduction

Sec. 631. Sense of the Congress in support of

the efforts of the administration to address the problems of

fraud and abuse in the supplemental security income program.

Sec. 632. Study on feasibility of single tamper-proof identification card to

serve programs under both the

Social Security Act and health

reform legislation.

Subtitle D—Additional Provisions

Sec. 641. State options regarding unemployed parent program.
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439

1995 T49.12

Sec. 642. Definition of essential person.

Sec. 643. ‘‘Fill-the-gap’’ budgeting.

Sec. 644. Repeal of requirement to make certain supplemental payments in

States paying less than their

needs standards.

Sec. 645. Collection of AFDC overpayments

from Federal tax refunds.

Sec. 646. Territories.

Sec. 647. Disregard of student income.

Sec. 648. Lump-sum income.

TITLE VII—CHILD PROTECTION BLOCK

GRANT PROGRAM

Sec. 701. Establishment of programs.

Sec. 702. Repeals and conforming amendments.

Sec. 703. Effective date.

TITLE VIII—SSI REFORM

Subtitle A—Eligibility of Children for

Benefits

Sec. 801. Restrictions on eligibility.

Sec. 802. Continuing disability reviews for

certain children.

Sec. 803. Disability review required for SSI

recipients who are 18 years of

age.

Sec. 804. Applicability.

Subtitle B—Denial of SSI Benefits by Reason

of Disability to Drug Addicts and Alcoholics

Sec. 811. Denial of SSI benefits by reason of

disability to drug addicts and

alcoholics.

TITLE IX—FINANCING

Subtitle A—Treatment of Aliens

Sec. 901. Extension of deeming of income

and resources under AFDC, SSI,

and food stamp programs.

Sec. 902. Requirements for sponsor’s affidavits of support.

Sec. 903. Extending requirement for affidavits of support to family-related and diversity immigrants.

Subtitle B—Limitation on Emergency

Assistance Expenditures

Sec. 911. Limitation on expenditures for

emergency assistance.

Subtitle C—Tax Provisions

Sec. 921. Certain Federal assistance includible in gross income.

Sec. 922. Earned income tax credit denied to

individuals not authorized to be

employed in the United States.

Sec. 923. Phaseout of earned income credit

for individuals having more

than $2,500 of taxable interest

and dividends.

Sec. 924. AFDC and food stamp benefits not

taken into account for purposes

of the earned income tax credit.

TITLE X—FOOD ASSISTANCE REFORM

Subtitle A—Food Stamp Program Integrity

and Reform

Sec. 1001. Authority to establish authorization periods.

Sec. 1002. Specific period for prohibiting participation of stores based on

lack of business integrity.

Sec. 1003. Information for verifying eligibility for authorization.

Sec. 1004. Waiting period for stores that initially fail to meet authorization criteria.

Sec. 1005. Bases for suspensions and disqualifications.

Sec. 1006. Authority to suspend stores violating program requirements

pending administrative and judicial review.

Sec. 1007. Disqualification of retailers who

are disqualified from the WIC

program.

Sec. 1008. Permanent debarment of retailers

who intentionally submit falsified applications.

Sec. 1009. Expanded civil and criminal forfeiture for violations of the

Food Stamp Act.

Sec. 1010. Expanded authority for sharing information provided by retailers.

Sec. 1011. Expanded definition of ‘‘coupon’’.

Sec. 1012. Doubled penalties for violating

food stamp program requirements.

Sec. 1013. Mandatory claims collection

methods.

Sec. 1014. Reduction of basic benefit level.

Sec. 1015. Pro-rating benefits after interruptions in participation.

Sec. 1016. Work requirement for able-bodied

recipients.

Sec. 1017. Extending current claims retention rates.

Sec. 1018. Coordination of employment and

training programs.

Sec. 1019. Promoting expansion of electronic

benefits transfer.

Sec. 1020. One-year freeze of standard deduction.

Sec. 1021. Nutrition assistance for Puerto

Rico.

Sec. 1022. Other amendments to the Food

Stamp Act of 1977.

Subtitle B—Commodity Distribution

Sec. 1051. Short title.

Sec. 1052. Availability of commodities.

Sec. 1053. State, local and private supplementation of commodities.

Sec. 1054. State plan.

Sec. 1055. Allocation of commodities to

States.

Sec. 1056. Priority system for State distribution of commodities.

Sec. 1057. Initial processing costs.

Sec. 1058. Assurances; anticipated use.

Sec. 1059. Authorization of appropriations.

Sec. 1060. Commodity supplemental food

program.

Sec. 1061. Commodities not income.

Sec. 1062. Prohibition against certain State

charges.

Sec. 1063. Definitions.

Sec. 1064. Regulations.

Sec. 1065. Finality of determinations.

Sec. 1066. Relationship to other programs.

Sec. 1067. Settlement and adjustment of

claims.

Sec. 1068. Repealers; amendments.

TITLE XI—DEFICIT REDUCTION

Sec. 1101. Dedication of savings to deficit reduction.

TITLE XII—EFFECTIVE DATE

Sec. 1201. Effective date.

SEC. 3. AMENDMENT OF THE SOCIAL SECURITY

ACT.

Except as otherwise expressly provided,

wherever in this Act an amendment or repeal

is expressed in terms of an amendment to, or

repeal of, a section or other provision, the

reference shall be considered to be made to a

section or other provision of the Social Security Act.

TITLE I—TIME-LIMITED TRANSITIONAL

ASSISTANCE

SEC. 101. LIMITATION ON DURATION OF AFDC

BENEFITS.

Section 402(a) (42 U.S.C. 602(a)) is

amended—

(1) by striking ‘‘and’’ at the end of paragraph (44);

(2) by striking the period at the end of

paragraph (45) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (45) the following:

‘‘(46) in the case of a State that has exercised the option provided for in paragraph

(52), provide that—

‘‘(A) a family shall not be eligible for aid

under the State plan if a member of the family is—

‘‘(i) prohibited from participating in the

State program established under subpart 1 of

part G by reason of section 497(b); or

‘‘(ii) prohibited from participating in the

State program established under subpart 2 of

part G by reason of section 499(a)(4); and

‘‘(B) each member of the family shall be

considered to be receiving such aid for purposes of eligibility for medical assistance

under the State plan approved under title

XIX for so long as the family would be eligible for such aid but for subparagraph (A).’’.

SEC. 102. ESTABLISHMENT OF FEDERAL DATA

BASE.

Section 402 (42 U.S.C. 602) is amended by

inserting after subsection (c) the following:

‘‘(d) The Secretary shall establish and

maintain a data base of participants in State

programs established under parts F and G

which shall be made available to the States

for use in administering subsection (a)(46).’’.

TITLE II—MAKE WORK PAY

Subtitle A—Health Care

SEC. 201. TRANSITIONAL MEDICAID BENEFITS.

(a) EXTENSION OF MEDICAID ENROLLMENT

FOR FORMER AFDC RECIPIENTS FOR 1 ADDITIONAL YEAR.—

(1) IN GENERAL.—Section 1925(b)(1) (42

U.S.C. 1396r–6(b)(1)) is amended by striking

the period at the end and inserting the following: ‘‘, and that the State shall offer to

each such family the option of extending

coverage under this subsection for any of the

first 2 succeeding 6-month periods, in the

same manner and under the same conditions

as the option of extending coverage under

this subsection for the first succeeding 6-

month period.’’.

(2) CONFORMING AMENDMENTS.—Section

1925(b) (42 U.S.C. 1396r–6(b)) is amended—

(A) in the heading, by striking ‘‘EXTENSION’’ and inserting ‘‘EXTENSIONS’’;

(B) in the heading of paragraph (1), by

striking ‘‘REQUIREMENT’’ and inserting ‘‘IN

GENERAL’’;

(C) in paragraph (2)(B)(ii)—

(i) in the heading, by striking ‘‘PERIOD’’

and inserting ‘‘PERIODS’’, and

(ii) by striking ‘‘in the period’’ and inserting ‘‘in each of the 6-month periods’’;

(D) in paragraph (3)(A), by striking ‘‘the 6-

month period’’ and inserting ‘‘any 6-month

period’’;

(E) in paragraph (4)(A), by striking ‘‘the

extension period’’ and inserting ‘‘any extension period’’; and

(F) in paragraph (5)(D)(i), by striking ‘‘is a

3-month period’’ and all that follows and inserting the following: ‘‘is, with respect to a

particular 6-month additional extension period provided under this subsection, a 3-

month period beginning with the 1st or 4th

month of such extension period.’’.

(b) EFFECTIVE DATE.—The amendments

made by subsection (a) shall apply to calendar quarters beginning on or after October

1, 1997, without regard to whether or not

final regulations to carry out such amendments have been promulgated by such date.

Subtitle B—Earned Income Tax Credit

SEC. 211. NOTICE OF AVAILABILITY REQUIRED

TO BE PROVIDED TO APPLICANTS

AND FORMER RECIPIENTS OF AFDC,

FOOD STAMPS, AND MEDICAID.

(a) AFDC.—Section 402(a) (42 U.S.C. 602(a)),

as amended by sections 101 and 102 of this

Act, is amended—

(1) by striking ‘‘and’’ at the end of paragraph (46);

(2) by striking the period at the end of

paragraph (47) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (47) the following:

‘‘(48) provide that the State agency must

provide written notice of the existence and

availability of the earned income credit

under section 32 of the Internal Revenue

Code of 1986 to—

‘‘(A) any individual who applies for aid

under the State plan, upon receipt of the application; and
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T49.12 MARCH 23

‘‘(B) any individual whose aid under the

State plan is terminated, in the notice of

termination of benefits.’’.

(b) FOOD STAMPS.—Section 11(e) of the

Food Stamp Act of 1977 (7 U.S.C. 2020(e)) is

amended—

(1) in paragraph (24) by striking ‘‘and’’ at

the end;

(2) in paragraph (25) by striking the period

at the end and inserting ‘‘; and’’; and

(3) by inserting after paragraph (25) the following:

‘‘(26) that whenever a household applies for

food stamp benefits, and whenever such benefits are terminated with respect to a household, the State agency shall provide to each

member of such household notice of—

‘‘(A) the existence of the earned income

tax credit under section 32 of the Internal

Revenue Code of 1986; and

‘‘(B) the fact that such credit may be applicable to such member.’’.

(c) MEDICAID.—Section 1902(a) (42 U.S.C.

1396a(a)) is amended—

(1) by striking ‘‘and’’ at the end of paragraph (61);

(2) by striking the period at the end of

paragraph (62) and inserting ‘‘; and’’; and

(3) by adding at the end the following new

paragraph:

‘‘(63) provide that the State shall provide

notice of the existence and availability of

the earned income tax credit under section

32 of the Internal Revenue Code of 1986 to

each individual applying for medical assistance under the State plan and to each individual whose eligibility for medical assistance under the State plan is terminated.’’.

SEC. 212. NOTICE OF AVAILABILITY OF EARNED

INCOME TAX CREDIT AND DEPENDENT CARE TAX CREDIT TO BE INCLUDED ON W–4 FORM.

Section 1114 of the Omnibus Budget Reconciliation Act of 1990 (26 U.S.C. 21 note), relating to program to increase public awareness, is amended by adding at the end the

following new sentence: ‘‘Such means shall

include printing a notice of the availability

of such credits on the forms used by employees to determine the proper number of withholding exemptions under chapter 24 of the

Internal Revenue Code of 1986.’’.

SEC. 213. ADVANCE PAYMENT OF EARNED INCOME TAX CREDIT THROUGH STATE

DEMONSTRATION PROGRAMS.

(a) IN GENERAL.—Section 3507 of the Internal Revenue Code of 1986 (relating to the advance payment of the earned income tax

credit) is amended by adding at the end the

following:

‘‘(g) STATE DEMONSTRATIONS.—

‘‘(1) IN GENERAL.—In lieu of receiving

earned income advance amounts from an employer under subsection (a), a participating

resident shall receive advance earned income

payments from a responsible State agency

pursuant to a State Advance Payment Program that is designated pursuant to paragraph (2).

‘‘(2) DESIGNATIONS.—

‘‘(A) IN GENERAL.—From among the States

submitting proposals satisfying the requirements of subsection (g)(3), the Secretary (in

consultation with the Secretary of Health

and Human Services) may designate not

more than 4 State Advance Payment Demonstrations. States selected for the demonstrations may have, in the aggregate, no

more than 5 percent of the total number of

household participating in the program

under the Food Stamp program in the immediately preceding fiscal year, Administrative

costs of a State in conducting a demonstration under this section may be included for

matching under section 403(a) of the Social

Security Act and section 16(a) of the Food

Stamp Act of 1977.

‘‘(B) WHEN DESIGNATION MAY BE MADE.—Any

designation under this paragraph shall be

made no later than December 31, 1995.

‘‘(C) PERIOD FOR WHICH DESIGNATION IS IN

EFFECT.—

‘‘(i) IN GENERAL.—Designations made under

this paragraph shall be effective for advance

earned income payments made after December 31, 1995, and before January 1, 1999.

‘‘(ii) SPECIAL RULES.—

‘‘(I) REVOCATION OF DESIGNATIONS.—The

Secretary may revoke the designation under

this paragraph if the Secretary determines

that the State is not complying substantially with the proposal described in paragraph (3) submitted by the State.

‘‘(II) AUTOMATIC TERMINATION OF DESIGNATIONS.—Any failure by a State to comply

with the reporting requirements described in

paragraphs (3)(F) and (3)(G) has the effect of

immediately terminating the designation

under this paragraph (2) and rendering paragraph (5)(A)(ii) inapplicable to subsequent

payments.

‘‘(3) PROPOSALS.—No State may be designated under subsection (g)(2) unless the

State’s proposal for such designation—

‘‘(A) identifies the responsible State agency,

‘‘(B) describes how and when the advance

earned income payments will be made by

that agency, including a description of any

other State or Federal benefits with which

such payments will be coordinated,

‘‘(C) describes how the State will obtain

the information on which the amount of advance earned income payments made to each

participating resident will be determined in

accordance with paragraph (4),

‘‘(D) describes how State residents who

will be eligible to receive advance earned income payments will be selected, notified of

the opportunity to receive advance earned

income payments from the responsible State

agency, and given the opportunity to elect to

participate in the program,

‘‘(E) describes how the State will verify, in

addition to receiving the certifications and

statement described in paragraph (7)(D)(iv),

the eligibility of participating residents for

the earned tax credit,

‘‘(F) commits the State to furnishing to

each participating resident and to the Secretary by January 31 of each year a written

statement showing—

‘‘(i) the name and taxpayer identification

number of the participating resident, and

‘‘(ii) the total amount of advance earned

income payments made to the participating

resident during the prior calendar year,

‘‘(G) commits the State to furnishing to

the Secretary by December 1 of each year a

written statement showing the name and

taxpayer identification number of each participating resident,

‘‘(H) commits the State to treat the advanced earned income payments as described

in subsection (g)(5) and any repayments of

excessive advance earned income payments

as described in subsection (g)(6),

‘‘(I) commits the State to assess the development and implementation of its State Advance Payment Program, including an agreement to share its findings and lessons with

other interested States in a manner to be described by the Secretary, and

‘‘(J) is submitted to the Secretary on or

before June 30, 1995.

‘‘(4) AMOUNT AND TIMING OF ADVANCE

EARNED INCOME PAYMENTS.—

‘‘(A) AMOUNT.—

‘‘(i) IN GENERAL.—The method for determining the amount of advance earned income payments made to each participating

resident is to conform to the full extent possible with the provisions of subsection (c).

‘‘(ii) SPECIAL RULE.—A State may, at its

election, apply the rules of subsection

(c)(2)(B) by substituting ‘between 60 percent

and 75 percent of the credit percentage in effect under section 32(b)(1) for an individual

with the corresponding number of qualifying

children’ for ‘60 percent of the credit percentage in effect under section 32(b)(1) for

such an eligible individual with 1 qualifying

child’ in clause (i) and ‘the same percentage

(as applied in clause (i))’ for ‘60 percent’ in

clause (ii).

‘‘(B) TIMING.—The frequency of advance

earned income payments may be made on

the basis of the payroll periods of participating residents, on a single statewide schedule, or on any other reasonable basis prescribed by the State in its proposal; however,

in no event may advance earned income payments be made to any participating resident

less frequently than on a calendar-quarter

basis.

‘‘(5) PAYMENTS TO BE TREATED AS PAYMENTS

OF WITHHOLDING AND FICA TAXES.—

‘‘(A) IN GENERAL.—For purposes of this

title, advance earned income payments during any calendar quarter—

‘‘(i) shall neither be treated as a payment

of compensation nor be included in gross income, and

‘‘(ii) shall be treated as made out of—

‘‘(I) amounts required to be deducted by

the State and withheld for the calendar

quarter by the State under section 3401 (relating to wage withholding), and

‘‘(II) amounts required to be deducted for

the calendar quarter under section 3102 (relating to FICA employee taxes), and

‘‘(III) amounts of the taxes imposed on the

State for the calendar quarter under section

3111 (relating to FICA employer taxes),

as if the State had paid to the Secretary, on

the day on which payments are made to participating residents, an amount equal to

such payments.

‘‘(B) ADVANCE PAYMENTS EXCEED TAXES

DUE.—If for any calendar quarter the aggregate amount of advance earned income payments made by the responsible State agency

under a State Advance Payment Program exceeds the sum of the amounts referred to in

subparagraph (A)(ii) (without regard to paragraph (6)(A)), each such advance earned income payment shall be reduced by an

amount which bears the same ratio to such

excess as such advance earned income payment bears to the aggregate amount of all

such advance earned income payments.

‘‘(6) STATE REPAYMENT OF EXCESSIVE ADVANCE EARNED INCOME PAYMENTS.—

‘‘(A) IN GENERAL.—Notwithstanding any

other provision of law, in the case of an excessive advance earned income payment a

State shall be treated as having deducted

and withheld under section 3401 (relating to

wage withholding), and therefore is required

to pay to the United States, the repayment

amount during the repayment calendar quarter.

‘‘(B) EXCESSIVE ADVANCE EARNED INCOME

PAYMENT.—For purposes of this section, an

excessive advance income payment is that

portion of any advance earned income payment that, when combined with other advance earned income payments previously

made to the same participating resident during the same calendar year, exceeds the

amount of earned income tax credit to which

that participating resident is entitled under

section 32 for that year.

‘‘(C) REPAYMENT AMOUNT.—The repayment

amount is equal to 50 percent of the excess

of—

‘‘(i) excessive advance earned income payments made by a State during a particular

calendar year, over

‘‘(ii) the sum of—

‘‘(I) 4 percent of all advance earned income

payments made by the State during that calendar year, and

‘‘(II) the excessive advance earned income

payments made by the State during that cal-
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441

1995 T49.12

endar year that have been collected from

participating residents by the Secretary.

‘‘(D) REPAYMENT CALENDAR QUARTER.—The

repayment calendar quarter is the second

calendar quarter of the third calendar year

after the calendar year in which an excessive

earned income payment is made.

‘‘(7) DEFINITIONS.—For purposes of this

section—

‘‘(A) STATE ADVANCE PAYMENT PROGRAM.—

The term ‘State Advance Payment Program’

means the program described in a proposal

submitted for designation under paragraph

(1) and designated by the Secretary under

paragraph (2).

‘‘(B) RESPONSIBLE STATE AGENCY.—The

term ‘responsible State agency’ means the

single State agency that will be making the

advance earned income payments to residents of the State who elect to participate in

a State Advance Payment Program.

‘‘(C) ADVANCE EARNED INCOME PAYMENTS.—

The term ‘advance earned income payments’

means an amount paid by a responsible State

agency to residents of the State pursuant to

a State Advance Payment Program.

‘‘(D) PARTICIPATING RESIDENT.—The term

‘participating resident’ means an individual

who—

‘‘(i) is a resident of a State that has in effect a designated State Advance Payment

Program,

‘‘(ii) makes the election described in paragraph (3)(C) pursuant to guidelines prescribed by the State,

‘‘(iii) certifies to the State the number of

qualifying children the individual has, and

‘‘(iv) provides to the State the certifications and statement set forth in subsections (b)(1), (b)(2), (b)(3), and (b)(4) (except

that for purposes of this clause (iv), the term

‘any employer’ shall be substituted for ‘another employer’ in subsection (b)(3)), along

with any other information required by the

State.’’.

(b) TECHNICAL ASSISTANCE.—The Secretaries of Treasury and Health and Human

Services shall jointly ensure that technical

assistance is provided to State Advance Payment Programs and that these programs are

rigorously evaluated.

(c) ANNUAL REPORTS.—The Secretary shall

issue annual reports detailing the extent to

which—

(1) residents participate in the State Advance Payment Programs,

(2) participating residents file Federal and

State tax returns,

(3) participating residents report accurately the amount of the advance earned income payments made to them by the responsible State agency during the year, and

(4) recipients of excessive advance earned

income payments repaid those amounts.

The report shall also contain an estimate of

the amount of advance earned income payments made by each responsible State agency but not reported on the tax returns of a

participating resident and the amount of excessive advance earned income payments.

(d) AUTHORIZATION OF APPROPRIATIONS.—

For purposes of providing technical assistance described in subsection (b), preparing

the reports described in subsection (c), and

providing grants to States in support of designated State Advance Payment Programs,

there are authorized to be appropriated in

advance to the Secretary of the Treasury

and the Secretary of Health and Human

Services a total of $1,400,000 for fiscal years

1996 through 1999.

Subtitle C—Child Care

SEC. 221. DEPENDENT CARE CREDIT TO BE REFUNDABLE; HIGH-INCOME TAXPAYERS INELIGIBLE FOR CREDIT.

(a) CREDIT TO BE REFUNDABLE.—

(1) IN GENERAL.—Section 21 of the Internal

Revenue Code of 1986 (relating to expenses

for household and dependent care services

necessary for gainful employment) is hereby

moved to subpart C of part IV of subchapter

A of chapter 1 of such Code (relating to refundable credits) and inserted after section

34.

(2) TECHNICAL AMENDMENTS.—

(A) Section 35 of such Code is redesignated

as section 36.

(B) Section 21 of such Code is redesignated

as section 35.

(C) Paragraph (1) of section 35(a) of such

Code (as redesignated by subparagraph (B)) is

amended by striking ‘‘this chapter’’ and inserting ‘‘this subtitle’’.

(D) Subparagraph (C) of section 129(a)(2) of

such Code is amended by striking ‘‘section

21(e)’’ and inserting ‘‘section 35(e)’’.

(E) Paragraph (2) of section 129(b) of such

Code is amended by striking ‘‘section

21(d)(2)’’ and inserting ‘‘section 35(d)(2)’’.

(F) Paragraph (1) of section 129(e) of such

Code is amended by striking ‘‘section

21(b)(2)’’ and inserting ‘‘section 35(b)(2)’’.

(G) Subsection (e) of section 213 of such

Code is amended by striking ‘‘section 21’’ and

inserting ‘‘section 35’’.

(H) Paragraph (2) of section 1324(b) of title

31, United States Code, is amended by inserting before the period ‘‘, or from section 35 of

such Code’’.

(I) The table of sections for subpart C of

part IV of subchapter A of chapter 1 of such

Code is amended by striking the item relating to section 35 and inserting the following:

‘‘Sec. 35. Expenses for household and dependent care services necessary for

gainful employment.

‘‘Sec. 36. Overpayments of tax.’’.

(J) The table of sections for subpart A of

such part IV is amended by striking the item

relating to section 21.

(b) HIGHER-INCOME TAXPAYERS INELIGIBLE

FOR CREDIT.—Subsection (a) of section 35 of

such Code, as redesignated by subsection (a),

is amended by adding at the end the following new paragraph:

‘‘(3) PHASEOUT OF CREDIT FOR HIGHER-INCOME TAXPAYERS.—The amount of the credit

which would (but for this paragraph) be allowed by this section shall be reduced (but

not below zero) by an amount which bears

the same ratio to such amount of credit as

the excess of the taxpayer’s adjusted gross

income for the taxable year over $60,000

bears to $20,000. Any reduction determined

under the preceding sentence which is not a

multiple of $10 shall be rounded to the nearest multiple of $10.’’.

(c) EFFECTIVE DATE.—The amendments

made by this section shall apply to taxable

years beginning after December 31, 1996.

SEC. 222. FUNDING OF CHILD CARE SERVICES.

(a) ELIMINATION OF CHILD CARE PROGRAMS.—

(1) AFDC AND TRANSITIONAL CHILD CARE

PROGRAMS.—

(A) REPEALER.—Section 402(g) (42 U.S.C.

602(g)) is hereby repealed.

(B) CONFORMING AMENDMENTS.—

(i) Section 403(a)(3) (42 U.S.C. 603(a)(3)) is

amended by striking ‘‘other than services

furnished pursuant to section 402(g)’’.

(ii) Section 403(e) (42 U.S.C. 603(e)) is

amended—

(I) by striking ‘‘, 402(a)(43), and 402(g)(1),’’

and inserting ‘‘and 402(a)(43)’’; and

(II) by striking the 2nd sentence.

(2) AT-RISK CHILD CARE PROGRAM.—Sections

402(i) and 403(n) (42 U.S.C. 602(i) and 603(n))

are hereby repealed.

(3) CHILD CARE PROGRAMS UNDER THE CHILD

CARE AND DEVELOPMENT BLOCK GRANT ACT OF

1990.—The Child Care and Development Block

Grant Act of 1990 (42 U.S.C. 9858 et seq.) is

hereby repealed.

(b) FUNDING OF CHILD CARE SERVICES

THROUGH SOCIAL SERVICES BLOCK GRANT PROGRAM.—Title XX (42 U.S.C. 1397–1397f) is

amended by adding at the end the following:

‘‘SEC. 2008. CHILD CARE.

‘‘(a) CONDITIONAL ENTITLEMENT.—In addition to any payment under section 2002 or

2007, each State with a plan approved under

this section for a fiscal year shall be entitled

to payment of an amount equal to the special allotment of the State for the fiscal

year.

‘‘(b) STATE PLANS.—

‘‘(1) CONTENT.—A plan meets the requirements of this paragraph if the plan—

‘‘(A) identifies an appropriate State agency

to be the lead agency responsible for administering at the State level, and coordinating

with local governments, the activities of the

State pursuant to this section;

‘‘(B) describes the activities the State will

carry out with funds provided under this section;

‘‘(C) provides assurances that the funds

provided under this section will be used to

supplement, not supplant, State and local

funds as well as Federal funds provided under

any Act and applied to child care activities

in the State during fiscal year 1989;

‘‘(D) provides assurances that the State

will not expend more than 7 percent of the

funds provided to the States under this section for the fiscal year for administrative expenses;

‘‘(E) provides assurances that, in providing

child care assistance, the State will give priority to families with low income and families living in a low-income geographical

area;

‘‘(F) ensures that child care providers reimbursed under this section meet applicable

standards of State and local law;

‘‘(G) provides assurances that the lead

agency will coordinate the use of funds provided under this section with the use of

other Federal resources for child care provided under this Act, and with other Federal,

State, or local child care and preschool programs operated in the State;

‘‘(H) provides for the establishment of such

fiscal and accounting procedures as may be

necessary to—

‘‘(i) ensure a proper accounting of Federal

funds received by the State under this section; and

‘‘(ii) ensure the proper verification of the

reports submitted by the State under subsection (f)(2);

‘‘(I) provides assurances that the State will

not impose more stringent standards and licensing or regulatory requirements on child

care providers receiving funds provided

under this section than those imposed on

other child care providers in the State;

‘‘(J) provides assurances that the State

will not implement any policy or practice

which has the effect of significantly restricting parental choice by—

‘‘(i) expressly or effectively excluding any

category of care or type of provider within a

category of care;

‘‘(ii) limiting parental access to or choices

from among various categories of care or

types of providers; or

‘‘(iii) excluding a significant number of

providers in any category of care; and

‘‘(K) provides assurances that parents will

be informed regarding their options under

this section, including the option of receiving a child care certificate or voucher.

‘‘(2) FORM.—A State may submit a plan

that meets the requirements of paragraph (1)

in the form of amendments to the State plan

submitted pursuant to section 658E of the

Child Care and Development Block Grant

Act of 1990, as in effect before the effective

date of section 222 of the Individual Responsibility Act of 1995.

‘‘(3) APPROVAL.—Not later than 90 days

after the date the State submits a plan to
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the Secretary under this subsection, the Secretary shall either approve or disapprove the

plan. If the Secretary disapproves the plan,

the Secretary shall provide the State with

an explanation and recommendations for

changes in the plan to gain approval.

‘‘(c) SPECIAL ALLOTMENTS.—

‘‘(1) IN GENERAL.—The special allotment of

a State for a fiscal year equals the amount

that bears the same ratio to the amount

specified in paragraph (2) for the fiscal year,

as the number of children who have not attained 13 years of age and are residing with

families in the State bears to the total number of such children in all States with plans

approved under this section for the fiscal

year, determined on the basis of the most recent data available from the Department of

Commerce at the time the special allotment

is determined.

‘‘(2) AMOUNT SPECIFIED.—The amount specified in this paragraph is—

‘‘(A) $1,400,000,000 for fiscal year 1997; and

‘‘(B) $1,450,000,000 for each of fiscal years

1998, 1999, and 2000.

‘‘(d) PAYMENTS TO STATES.—

‘‘(1) PAYMENTS.—The Secretary shall provide funds to each State with a plan approved under this section for a fiscal year

from the special allotment of the State for

the fiscal year, in accordance with section

6503 of title 31, United States Code.

‘‘(2) EXPENDITURE OF FUNDS BY STATES.—

Except as provided in paragraph (3)(A), each

State to which funds are paid under this section for a fiscal year shall expend such funds

in the fiscal year or in the immediately succeeding fiscal year.

‘‘(3) REDISTRIBUTION OF UNEXPENDED SPECIAL ALLOTMENTS.—

‘‘(A) REMITTANCE TO THE SECRETARY.—Each

State to which funds are paid under this section for a fiscal year shall remit to the Secretary that part of such funds which the

State intends not to, or does not, expend in

the fiscal year or in the immediately succeeding fiscal year.

‘‘(B) REDISTRIBUTION.—The Secretary shall

increase the special allotment of each State

with a plan approved under this part for a

fiscal year that does not remit any amount

to the Secretary for the fiscal year by an

amount equal to—

‘‘(i) the aggregate of the amounts remitted

pursuant to subparagraph (A) for the fiscal

year; multiplied by

‘‘(ii) the adjusted State share for the fiscal

year.

‘‘(C) ADJUSTED STATE SHARE.—As used in

subparagraph (B)(ii), the term ‘adjusted

State share’ means, with respect to a fiscal

year—

‘‘(i) the special allotment of the State for

the fiscal year (before any increase under

subparagraph (B)); divided by

‘‘(ii)(I) the sum of the special allotments of

all States with plans approved under this

part for the fiscal year; minus

‘‘(II) the aggregate of the amounts remitted to the Secretary pursuant to subparagraph (A) for the fiscal year.

‘‘(e) USE OF FUNDS.—

‘‘(1) IN GENERAL.—Funds provided under

this section shall be used to expand parent

choices in selecting child care, to address deficiencies in the supply of child care, and to

expand and improve child care services, with

an emphasis on providing such services to

low-income families and geographical areas.

Subject to the approval of the Secretary,

States to which funds are paid under this

section shall use such funds to carry out

child care programs and activities through

cash grants, certificates, or contracts with

families, or public or private entities as the

State determines appropriate. States shall

take parental preference into account to the

maximum extent possible in carrying out

child care programs.

‘‘(2) SPECIFIC USES.—Each State to which

funds are paid under this section may expend

such funds for—

‘‘(A) child care services for infants, sick

children, children with special needs, and

children of adolescent parents;

‘‘(B) after-school and before-school programs and programs during nontraditional

hours for the children of working parents;

‘‘(C) programs for the recruitment and

training of day care workers, including older

Americans;

‘‘(D) grant and loan programs to enable

child care workers and providers to meet

State and local standards and requirements;

‘‘(E) child care programs developed by public and private sector partnerships;

‘‘(F) State efforts to provide technical assistance designed to help providers improve

the services offered to parents and children;

and

‘‘(G) other child care-related programs consistent with the purpose of this section and

approved by the Secretary.

‘‘(3) LIMITATIONS ON USE OF FUNDS.—A

State to which funds are paid under this section for a fiscal year shall use not less than

80 percent of such funds to provide direct

child care assistance to low-income parents

through child care certificates or vouchers,

contracts, or grants.

‘‘(4) METHODS OF FUNDING.—Funds for child

care services under this title shall be for the

benefit of parents and shall be provided

through child care vouchers or certificates

provided directly to parents or through contracts or grants with public or private providers.

‘‘(5) PARENTAL RIGHTS OF CHOICE.—Any parent who receives a child care certificate

under this title may use such certificate

with any child care provider, including those

providers which have religious activities, if

such provider is freely chosen by the parent

from among the available alternatives.

‘‘(6) CHILD CARE CERTIFICATES.—

‘‘(A) IN GENERAL.—For purposes of this

title, a child care certificate is a certificate

issued by a State directly to a parent or

legal guardian for use only as payment for

child care services in any child care facility

eligible to receive funds under this Act.

‘‘(B) REDEMPTION.—If the demand for child

care services of families qualified to receive

such services from a State under this Act exceeds the available supply of such services,

the State shall ration assistance to obtain

such services using procedures that do not

disadvantage parents using child care certificates, relative to other methods of financing,

in either the waiting period or the pecuniary

value of such services.

‘‘(C) COMMENCEMENT OF CERTIFICATE PROGRAM.—Beginning not later than 1 year after

the date of the enactment of this section,

each State that receives funds under this

title shall offer a child care certificate program in accordance with this section.

‘‘(D) AUTHORITY TO USE CHILD CARE FUNDS

FOR CERTIFICATE PROGRAM.—Each State to

which funds are paid under this title may use

the funds provided to the State under this

title which are required to be used for child

care activities to plan and establish the

State’s child care certificate program.

‘‘(7) OPTION OF RECEIVING A CHILD CARE CERTIFICATE.—Each parent or legal guardian

who receives assistance pursuant to this

title shall be provided with the option of enrolling their child with an eligible child care

provider that receives funds through grants,

contracts, or child care certificates provided

under this title. Such parent shall have the

right to use such certificates to purchase

child care services from an eligible provider

of their choice. The State shall ensure that

parental preference is considered to the maximum extent possible in awarding grants or

contracts.

‘‘(8) RIGHTS OF RELIGIOUS CHILD CARE PROVIDERS.—Notwithstanding any other provision of law, a religious child care provider

who receives funds under this Act may require adherence by employees to the religious tenets or teachings of the provider.

‘‘(9) ELIGIBLE CHILD CARE PROVIDERS.—Any

child care provider who meets applicable

standards of State and local law shall be eligible to receive funds under this section. As

used in this paragraph, the term ‘child care

provider’ includes—

‘‘(A) proprietary for-profit entities, relatives, informal day care homes, religious

child care providers, day care centers, and

any other entities that the State determines

appropriate subject to approval of the Secretary;

‘‘(B) nonprofit organizations under subsections (c) and (d) of section 501 of the Internal Revenue Code of 1986;

‘‘(C) professional or employee associations;

‘‘(D) consortia of small businesses; and

‘‘(E) units of State and local governments,

and elementary, secondary, and post-secondary educational institutions.

‘‘(10) PROHIBITED USES.—Any State to

which funds are paid under this section may

not use such funds—

‘‘(A) to satisfy any State matching requirement imposed under any Federal grant;

‘‘(B) for the purchase or improvement of

land, or the purchase, construction, or permanent improvement (other than minor remodeling) of any building or other facility;

or

‘‘(C) to provide any service which the State

makes generally available to the residents of

the State without cost to such residents and

without regard to the income of such residents.

‘‘(f) REPORTING REQUIREMENTS.—

‘‘(1) NOTICE TO SECRETARY OF UNEXPENDED

FUNDS.—Each State which has not completely expended the funds paid to the State

under this section for a fiscal year in the fiscal year or the immediately succeeding fiscal year shall notify the Secretary of any

amount not so expended.

‘‘(2) STATE REPORTS ON USE OF FUNDS.—Not

later than 18 months after the date of the enactment of this section, and each year thereafter, the State shall prepare and submit to

the Secretary, in such form as the Secretary

shall prescribe, a report describing the

State’s use of funds paid to the State under

this section, including—

‘‘(A) the number, type, and distribution of

services and programs under this section;

‘‘(B) the average cost of child care, by type

of provider;

‘‘(C) the number of children serviced under

this section;

‘‘(D) the average income and distribution

of incomes of the families being served;

‘‘(E) efforts undertaken by the State pursuant to this section to promote and ensure

health and safety and improve quality; and

‘‘(F) such other information as the Secretary considers appropriate.

‘‘(3) GUIDELINES FOR STATE REPORTS; COORDINATION WITH REPORTS UNDER SECTION

2006.—Within 6 months after the date of the

enactment of this section, the Secretary

shall establish guidelines for State reports

under paragraph (2). To the extent feasible,

the Secretary shall coordinate such reporting requirement with the reports required

under section 2006 and, as the Secretary

deems appropriate, with other reporting requirements placed on States as a condition

of receipt of other Federal funds which support child care.

‘‘(4) REPORTS BY THE SECRETARY.—

‘‘(A) REPORTS TO THE CONGRESS OF SUMMARY OF STATE REPORTS.—The Secretary

shall annually summarize the information

reported to the Secretary pursuant to para-
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1995 T49.12

graph (2) and provide such summary to the

Congress.

‘‘(B) REPORTS TO THE STATES ON EFFECTIVE

PRACTICES.—The Secretary shall annually

provide the States with a report on particularly effective practices and programs supported by funds paid to the State under this

section, which ensure the health and safety

of children in care, promote quality child

care, and provide training to all types of providers.

‘‘(g) ADMINISTRATION AND ENFORCEMENT.—

‘‘(1) ADMINISTRATION.—The Secretary

shall—

‘‘(A) coordinate all activities of the Department of Health and Human Services relating to child care, and, to the maximum

extent practicable, coordinate such activities with similar activities of other Federal

entities;

‘‘(B) collect, publish, and make available

to the public a listing of State child care

standards at least once every 3 years; and

‘‘(C) provide technical assistance to assist

States to carry out this section, including

assistance on a reimbursable basis.

‘‘(2) ENFORCEMENT.—

‘‘(A) REVIEW OF COMPLIANCE WITH STATE

PLAN.—The Secretary shall review and monitor State compliance with this section and

the plans approved under this section for the

State, and shall have the power to terminate

payments to the State in accordance with

subparagraph (B).

‘‘(B) NONCOMPLIANCE.—

‘‘(i) IN GENERAL.—If the Secretary, after

reasonable notice to a State and opportunity

for a hearing, finds that—

‘‘(I) there has been a failure by the State

to comply substantially with any provision

or requirement set forth in the plan approved under this section for the State; or

‘‘(II) in the operation of any program for

which assistance is provided under this section there is a failure by the State to comply

substantially with any provision of this section;

the Secretary shall notify the State of the

findings and that no further payments may

be made to such State under this section (or,

in the case of noncompliance in the operation of a program or activity, that no further payments to the State will be made

with respect to such program or activity)

until the Secretary is satisfied that there is

no longer any such failure to comply or that

the noncompliance will be promptly corrected.

‘‘(ii) ADDITIONAL SANCTIONS.—In the case of

a finding of noncompliance made pursuant to

clause (i), the Secretary may, in addition to

imposing the sanctions described in such

subparagraph, impose the other appropriate

sanctions, including recoupment of money

improperly expended for purposes prohibited

or not authorized by this section, and disqualification from the receipt of financial assistance under this section.

‘‘(iii) NOTICE.—The notice required under

subparagraph (A) shall include a specific

identification of any additional sanction

being imposed under clause (ii).

‘‘(C) ISSUANCE OF RULES.—The Secretary

shall establish by rule procedures for—

‘‘(i) receiving, processing, and determining

the validity of complaints concerning any

failure of a State to comply with the State

plan or any requirement of this section; and

‘‘(ii) imposing sanctions under this subsection.

‘‘SEC. 2009. CHILD CARE DURING PARTICIPATION

IN EMPLOYMENT, EDUCATION, AND

TRAINING; EXTENDED ELIGIBILITY.

‘‘(a) CHILD CARE GUARANTEE.—

‘‘(1) IN GENERAL.—Each State agency referred to in section 2008(b)(1)(A) shall guarantee child care in accordance with section

2008—

‘‘(A) for any individual who is participating in an education or training activity

(including participation in a program established under part G of title IV) if the State

agency approves the activity and determines

that the individual is participating satisfactorily in the activity;

‘‘(B) for each family with a dependent child

requiring such care to the extent that such

care is determined by the State agency to be

necessary for an individual in the family to

accept employment or remain employed, including in a community service job under

part H of title IV; and

‘‘(C) to the extent that the State agency

determines that such care is necessary for

the employment of an individual, if the family of which the individual is a member has

ceased to receive aid under the State plan

approved under part A of title IV by reason

of increased hours of, or income from, such

employment or by reason of section

402(a)(8)(B)(ii)(II), subject to paragraph (2) of

this subsection.

‘‘(2) LIMITATIONS ON ELIGIBILITY FOR TRANSITIONAL CHILD CARE.—A family shall not be

eligible for child care under paragraph

(1)(C)—

‘‘(A) for more than 12 months after the last

month for which the family received aid described in such paragraph;

‘‘(B) if the family did not receive such aid

in at least 3 of the most recent 6 months in

which the family received such aid;

‘‘(C) if the family does not include a child

who is (or, if needy, would be) a dependent

child (within the meaning of part A of title

IV);

‘‘(D) for any month beginning after the

caretaker relative (within the meaning of

such part) in the family has terminated his

or her employment without good cause; or

‘‘(E) with respect to a child, for any month

beginning after the caretaker relative in the

family has refused to cooperate with the

State in establishing or enforcing the obligation of any parent of the child to provide

support for the child, without good cause as

determined by the State agency in accordance with standards prescribed by the Secretary which shall take into consideration

the best interests of the child.

‘‘(b) STATE ENTITLEMENT TO PAYMENTS.—

Each State with a plan approved under section 2008 shall be entitled to receive from the

Secretary for any fiscal year an amount

equal to—

‘‘(1) the total amount expended by the

State to carry out subsection (a) during the

fiscal year; multiplied by

‘‘(2) the greater of—

‘‘(A) 70 percent; or

‘‘(B) the Federal medical assistance percentage (as defined in the last sentence of

section 1118, increased by 10 percentage

points.’’.

(c) EFFECTIVE DATE.—The amendments and

repeals made by this section shall take effect

on October 1, 1996.

Subtitle D—AFDC Work Disregards

SEC. 231. OPTION TO INCREASE DISREGARD OF

EARNED INCOME.

Section 402(a)(8)(A) (42 U.S.C. 602(a)(8)(A))

is amended—

(1) by striking ‘‘and’’ at the end of clause

(vii); and

(2) by adding at the end the following:

‘‘(ix) if electing to disregard clauses (ii)

and (iv), shall disregard from the earned income of any child, relative, or other individual specified in clause (ii) an amount

equal to not less than the first $120 and not

more than the first $225 of the total of such

earned income not disregarded under any

other clause of this subparagraph, plus not

more than one third of the remainder of such

earned income; and’’.

SEC. 232. STATE OPTION TO ESTABLISH VOLUNTARY DIVERSION PROGRAM.

Section 402(a) (42 U.S.C. 602(a)), as amended

by sections 101, 102, and 211(a) of this Act, is

amended—

(1) by striking ‘‘and’’ at the end of paragraph (47);

(2) by striking the period at the end of

paragraph (48) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (48) the following:

‘‘(49) at the option of the State, and in such

part or parts of the State as the State may

select, provide that—

‘‘(A) upon the recommendation of the caseworker who is handling the case of a family

eligible for aid under the State plan, the

State shall, in lieu of any other payment

under the State plan to a family during a

time period of not more than 3 months,

make a lump-sum payment to the family for

the time period in an amount not to exceed—

‘‘(i) the amount of the monthly benefit to

which the family is entitled under the State

plan; multiplied by

‘‘(ii) the number of months in the time period;

‘‘(B) a lump-sum payment pursuant to subparagraph (A) shall not be made more than

once to any family; and

‘‘(C) if, during a time period for which the

State has made a lump-sum payment to a

family pursuant to subparagraph (A), the

family applies for and (but for the lump-sum

payment) would be eligible for aid under the

State plan for a greater monthly benefit

than the monthly benefit to which the family was entitled under the State plan at the

time of the calculation of the lump sum payment, then, notwithstanding subparagraph

(A), the State shall, for that part of the time

period that remains after the family becomes eligible for the greater monthly benefit, provide monthly benefits to the family

in an amount not to exceed—

‘‘(i) the amount by which the greater

monthly benefit exceeds the former monthly

benefit, multiplied by the number of months

in the time period; divided by

‘‘(ii) the whole number of months remaining in the time period.’’.

SEC. 233. ELIMINATION OF QUARTERS OF COVERAGE REQUIREMENT FOR MARRIED TEENS UNDER AFDC–UP PROGRAM.

(a) IN GENERAL.—Section 407(b)(1)(A)(iii)(I)

(42 U.S.C. 607(b)(1)(A)(iii)(I)) is amended by

inserting ‘‘except in the case of a family in

which the parents are married and neither

parent has attained 20 years of age,’’ after

‘‘(I)’’.

(b) EXTENSION OF AFDC–UP PROGRAM.—

Section 401(h) of the Family Support Act of

1988 (42 U.S.C. 602 and note, 607) is amended

by striking ‘‘1998’’ and inserting ‘‘2000’’.

Subtitle E—AFDC Asset Limitations

SEC. 241. INCREASE IN RESOURCE THRESHOLDS;

SEPARATE THRESHOLD FOR VEHICLES.

Section 402(a)(7)(B) (42 U.S.C. 602(a)(7)(B))

is amended—

(1) by striking ‘‘$1,000 or such lower

amount as the State may determine’’ and inserting ‘‘$2,000’’; and

(2) in clause (i), by striking ‘‘such amount

as the Secretary may prescribe’’ and inserting ‘‘the dollar amount prescribed by the

Secretary of Agriculture under section 5(g)

of the Food Stamp Act of 1977’’.

SEC. 242. LIMITED DISREGARD OF AMOUNTS

SAVED FOR POST-SECONDARY EDUCATION, THE PURCHASE OF A FIRST

HOME, OR THE ESTABLISHMENT OR

OPERATION OF A MICROENTERPRISE.

(a) DISREGARD FROM RESOURCES.—Section

402(a)(7)(B) (42 U.S.C. 602(a)(7)(B)) is

amended—

(1) by striking ‘‘or’’ before ‘‘(iv)’’; and
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(2) by inserting ‘‘, or (v) any amount not

exceeding $8,000 in 1 qualified asset account

(as defined in section 406(i)) of 1 member of

such family’’ before ‘‘; and’’.

(b) DISREGARD FROM INCOME.—

(1) IN GENERAL.—Section 402(a)(8)(A) (42

U.S.C. 602(a)(8)(A)), as amended by section

231 of this Act, is amended—

(A) by striking ‘‘and’’ at the end of clause

(viii); and

(B) by inserting after clause (ix) the following new clause:

‘‘(x) shall disregard any interest or income

earned on a qualified asset account (as defined in section 406(i)) and paid into the account, to the extent that the total amount in

the account, after such payment, does not

exceed $8,000; and’’.

(2) NONRECURRING LUMP SUM EXEMPT FROM

LUMP SUM RULE.—Section 402(a)(17) (42 U.S.C.

602(a)(17)) is amended by adding at the end

the following: ‘‘; and that this paragraph

shall not apply to earned or unearned income

received in a month on a nonrecurring basis

to the extent that such income is placed in

a qualified asset account (as defined in section 406(i)) the total amount in which, after

such placement, does not exceed $8,000;’’.

(3) TREATMENT AS INCOME.—Section

402(a)(7) (42 U.S.C. 602(a)(7)) is amended—

(A) by striking ‘‘and’’ at the end of subparagraph (B);

(B) by striking the semicolon at the end of

subparagraph (C) and inserting ‘‘; and’’; and

(C) by adding at the end the following new

subparagraph:

‘‘(D) shall treat as income any distribution

from a qualified asset account (as defined in

section 406(i)(1)) that is not a qualified distribution (as defined in section 406(i)(2));’’.

(c) DEFINITIONS.—Section 406 (42 U.S.C. 606)

is amended by adding at the end the following:

‘‘(i)(1) The term ‘qualified asset account’

means a mechanism approved by the State

(such as individual retirement accounts, escrow accounts, or savings bonds) that allows

savings of an individual receiving aid to families with dependent children to be used for a

purpose described in paragraph (2).

‘‘(2) The term ‘qualified distribution’

means a distribution for expenses directly

related to 1 or more of the following purposes:

‘‘(A) The attendance of a member of the

family at any postsecondary education program.

‘‘(B) The purchase of residential real property for the family that the family intends

to occupy, if no member of the family has an

ownership interest in such a property.

‘‘(C) The establishment or operation of a

microenterprise owned by a member of the

family.

‘‘(j) The term ‘microenterprise’ means a

commercial enterprise which has 5 or fewer

employees, 1 or more of whom owns the enterprise.’’.

TITLE III—THE WORK FIRST PROGRAM

SEC. 301. WORK FIRST PROGRAM.

(a) STATE PLAN REQUIREMENT.—Section

402(a) (42 U.S.C. 602(a)), as amended by sections 101, 102, 211(a), and 232 of this Act, is

amended—

(1) by striking ‘‘and’’ at the end of paragraph (48);

(2) by striking the period at the end of

paragraph (49) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (49) the following:

‘‘(50) provide that the State—

‘‘(A) shall develop an individual responsibility plan in accordance with part F for

each applicant for, or recipient of, aid under

the State plan who—

‘‘(i) has attained 18 years of age; or

‘‘(ii) has not completed high school or obtained a certificate of high school equivalency, and is not attending secondary school;

‘‘(B) has in effect and operation—

‘‘(i) a work first program that meets the

requirements of subpart 1 of part G (or, for

any fiscal year for which the Secretary has

approved a State plan under subpart 2 of part

G, such subpart 2); and

‘‘(ii) a community service program that

meets the requirements of part H, or a job

placement voucher program that meets the

requirements of part I, but not both;

‘‘(C) shall provide a position in the

workfare program established by the State

under part H, or a job placement voucher

under the job placement voucher program established by the State under part I to any individual who, by reason of section 497(b), is

prohibited from participating in the work

first program operated by the State, and

shall not provide such a position or such a

voucher to any other individual; and

‘‘(D) shall provide to participants in such

programs such case management services as

are necessary to ensure the integrated provision of benefits and services under such programs.’’.

(b) ESTABLISHMENT AND OPERATION OF PROGRAM.—Title IV (42 U.S.C. 601 et seq.) is

amended by striking part F and inserting the

following:

‘‘Part F—Individual Responsibility Plan

‘‘SEC. 481. ASSESSMENT.

‘‘The State agency referred to in section

402(a)(3) shall make an initial assessment of

the skills, prior work experience, and employability of each individual for whom section 402(a)(50)(A) requires the State to develop an individual responsibility plan.

‘‘SEC. 482. INDIVIDUAL RESPONSIBILITY PLANS.

‘‘(a) IN GENERAL.—On the basis of the assessment made under section 481 with respect to an individual, the State agency, in

consultation with the individual, shall develop an individual responsibility plan for

the individual, which—

‘‘(1) shall provide that participation by the

individual in job search activities shall be a

condition of eligibility for aid under the

State plan approved under part A, except

during any period for which the individual is

employed full-time in an unsubsidized job in

the private sector;

‘‘(2) sets forth an employment goal for the

individual and a plan for moving the individual immediately into private sector employment;

‘‘(3) sets forth the obligations of the individual, which may include a requirement

that the individual attend school, maintain

certain grades and attendance, keep school

age children of the individual in school, immunize children, attend parenting and

money management classes, or do other

things that will help the individual become

and remain employed in the private sector;

and

‘‘(4) may require that the individual enter

the State program established under part G,

if the caseworker determines that the individual will need education, training, job

placement assistance, wage enhancement, or

other services to become employed in the

private sector.

‘‘(b) TIMING.—The State agency shall comply with subsection (a) with respect to an

individual—

‘‘(1) within 90 days (or, at the option of the

State, 180 days) after the effective date of

this part, in the case of an individual who, as

of such effective date, is a recipient of aid

under the State plan approved under part A;

or

‘‘(2) within 30 days (or, at the option of the

State, 90 days) after the individual is determined to be eligible for such aid, in the case

of any other individual.

‘‘SEC. 483. PROVISION OF PROGRAM AND EMPLOYMENT INFORMATION.

‘‘The State shall inform all applicants for

and recipients of aid under the State plan approved under part A of all available services

under the State plan for which they are eligible.

‘‘SEC. 484. REQUIREMENT THAT RECIPIENTS

ENTER THE WORK FIRST PROGRAM.

‘‘(a) IN GENERAL.—Beginning with fiscal

year 2004, the State shall place recipients of

aid under the State plan approved under part

A, who have not become employed in the private sector within 1 year after signing an individual responsibility plan, in the first

available slot in the State program established under part G, except as provided in

subsection (b).

‘‘(b) EXCEPTIONS.—A State may not be required to place a recipient of such aid in the

State program established under part G if

the recipient—

‘‘(1) is ill, incapacitated, or of advanced

age;

‘‘(2) has not attained 18 years of age;

‘‘(3) is caring for a child or parent who is

ill or incapacitated; or

‘‘(4) is enrolled in school or in educational

or training programs that will lead to private sector employment.

‘‘SEC. 485. PENALTIES.

‘‘(a) STATE NOT OPERATING A WORK FIRST

PROGRAM UNDER A STATE MODEL OR A

WORKFARE PROGRAM.—In the case of a State

that is not operating a program under subpart 2 of part G or under part H:

‘‘(1) FAILURE TO COMPLY WITH INDIVIDUAL

RESPONSIBILITY PLAN OR AGREEMENT OF MUTUAL RESPONSIBILITY.—

‘‘(A) PROGRESSIVE REDUCTIONS IN AID FOR

1ST AND 2ND FAILURES.—The amount of aid

otherwise payable under the State plan approved under part A to a family that includes an individual who fails without good

cause to comply with an individual responsibility plan (or, if the State has established a

program under subpart 1 of part G and the

individual is required to participate in the

program, an agreement of mutual responsibility) signed by the individual (other than

by reason of conduct described in paragraph

(2)) shall be reduced by—

‘‘(i) 33 percent for the 1st such act of noncompliance; or

‘‘(ii) 66 percent for the 2nd such act of noncompliance.

‘‘(B) DENIAL OF AID FOR 3RD FAILURE.—In

the case of the 3rd such act of noncompliance, the family of which the individual is a

member shall not thereafter be eligible for

aid under the State plan approved under part

A.

‘‘(C) ACTS OF NONCOMPLIANCE.—For purposes of this paragraph, a 1st act of noncompliance by an individual continues for

more than 1 calendar month shall be considered a 2nd act of noncompliance, and a 2nd

act of noncompliance that continues for

more than 3 calendar months shall be considered a 3rd act of noncompliance.

‘‘(2) DENIAL OF AFDC TO ADULTS REFUSING TO

WORK, LOOK FOR WORK, OR ACCEPT A BONA FIDE

OFFER OF EMPLOYMENT.—

‘‘(A) REFUSAL TO WORK OR LOOK FOR

WORK.—If an unemployed individual who has

attained 18 years of age refuses to work or

look for work—

‘‘(i) in the case of the 1st such refusal, aid

under the State plan approved under part A

shall not be payable with respect to the individual until the later of—

‘‘(I) a period of not less than 6 months after

the date of the first such refusal; or

‘‘(II) the first date the individual agrees to

work or look for work.

‘‘(ii) in the case of the 2nd such refusal, the

family of which the individual is a member

shall not thereafter be eligible for aid under

the State plan approved under part A.

‘‘(B) REFUSAL TO ACCEPT A BONA FIDE OFFER

OF EMPLOYMENT.—If an unemployed individual who has attained 18 years of age re-
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1995 T49.12

fuses to accept a bona fide offer of employment, the family of which the individual is a

member shall not thereafter be eligible for

aid under the State plan approved under part

A.

‘‘(b) OTHER STATES.—In the case of any

other State, the State shall reduce, by such

amount as the State considers appropriate,

the amount of aid otherwise payable under

the State plan approved under part A to a

family that includes an individual who fails

without good cause to comply with an individual responsibility plan signed by the individual.

‘‘Part G—Work First Program

‘‘Subpart 1—Federal Model

‘‘SEC. 491. ESTABLISHMENT AND OPERATION OF

STATE PROGRAMS.

‘‘A work first program meets the requirements of this subpart if the program meets

the following requirements:

‘‘(1) OBJECTIVE.—The objective of the program is for each program participant to find

and hold a full-time unsubsidized paid job,

and for this goal to be achieved in a cost-effective fashion.

‘‘(2) METHOD.—The method of the program

is to connect recipients of aid to families

with dependent children with the private

sector labor market as soon as possible and

offer them the support and skills necessary

to remain in the labor market. Each component of the program should be permeated

with an emphasis on employment and with

an understanding that minimum wage jobs

are a stepping stone to more highly paid employment.

‘‘(3) JOB CREATION.—The creation of jobs,

with an emphasis on private sector jobs,

shall be a component of the program and

shall be a priority for each State office with

responsibilities under the program.

‘‘(4) USE OF INCENTIVES.—The State shall

use incentives to change the culture of each

State office with responsibilities under the

State plan approved under part A, improve

the performance of employees, and ensure

that the objective of each employee of each

such State office is to find an unsubsidized

paid job for each program participant.

‘‘(5) CASEWORKER TRAINING.—The State

may provide such training to caseworkers

and related personnel (including through the

use of incentives) as may be necessary to ensure successful job placements that result in

full-time public or private employment (outside the State agencies with responsibilities

under part A) for program participants. The

State shall reward any caseworker who enters an agreement of mutual responsibility

with a program participant that provides for

education or training activities as well as

work.

‘‘(6) REPORTS.—Each office with responsibility for operating the program shall make

monthly statistical reports to the governing

body of the State, county, and city in which

located, of job placements and the number of

program participants who are no longer receiving aid under the State plan approved

under part A as a result of participation in

the program.

‘‘(7) CASE MANAGEMENT TEAMS.—

‘‘(A) DUTIES.—The program requires the

State to assign to each individual required

or allowed to participate in the program a

case management team that shall meet with

the program participant and develop an

agreement of mutual responsibility for the

individual.

‘‘(B) DEADLINE.—

‘‘(i) IN GENERAL.—The case management

team shall comply with subparagraph (A)

with respect to a program participant within

30 days (or, at the option of the State, within

a period not exceeding 90 days) after the

later of—

‘‘(I) the date the application of the program participant for aid under the State

plan approved under part A was approved; or

‘‘(II) the date this subpart first applies to

the State.

‘‘(ii) REPEAT PARTICIPANTS.—Within 30 days

after the State makes a determination under

section 497(b)(2) to allow an individual to

participate in the program, the case management team shall meet with the individual

and develop an agreement of mutual responsibility for the individual.

‘‘(8) AGREEMENTS OF MUTUAL RESPONSIBILITY.—The agreement of mutual responsibility for a participant shall—

‘‘(A) contain an individualized comprehensive plan, developed by the team and the participant, to move the participant into a fulltime unsubsidized job, through activities

under section 492, 493, 494, 495, or 496;

‘‘(B) to the greatest extent possible, be designed to move the participant as quickly as

possible into whatever type and amount of

work as the participant is capable of handling, and increases the responsibility and

amount of work over time until the participant is able to work full-time;

‘‘(C) where necessary, provide for education or training of the participant;

‘‘(D) provide that aid under the State plan

is to be paid to the participant based on the

number of hours that the participant spends

in activities provided for in the agreement;

‘‘(E) provide that the participant shall

spend at least 30 hours per week (or, at State

option, at least 20 hours per week during fiscal years 1997 and 1998, and at least 25 hours

per week during fiscal year 1999) in activities

provided for in the agreement;

‘‘(F) provide that the participant shall accept any bona fide offer of unsubsidized fulltime employment, unless the participant has

good cause for not doing so;

‘‘(G) at the option of the State, require the

participant to undergo appropriate substance

abuse treatment; and

‘‘(H) at the option of the State, require the

participant to have his or her children receive appropriate immunizations against disease.

‘‘(9) OPTIONS FOR PARTICIPANTS.—The case

manager for a program participant shall

present the participant with each option offered under the State program through

which the participant will, over time, be

moved into full-time unsubsidized employment.

‘‘(10) ONE-STOP EMPLOYMENT SHOPS.—

‘‘(A) IN GENERAL.—In carrying out the program, the State shall utilize and make available to each program participant, through

the establishment and operation or utilization of appropriate Federal or State one-stop

employment shops, services under programs

carried out under the following provisions of

law:

‘‘(i) Part A of title II of the Job Training

Partnership Act (29 U.S.C. 1601 et seq.) (relating to the adult training program).

‘‘(ii) Part B of title II of such Act (29 U.S.C.

1630 et seq.) (relating to the summer youth

employment and training programs).

‘‘(iii) Part C of title II of such Act (29

U.S.C. 1641 et seq.) (relating to the youth

training program).

‘‘(iv) Title III of such Act (29 U.S.C. 1651 et

seq.) (relating to employment and training

assistance for dislocated workers).

‘‘(v) Part B of title IV of such Act (29

U.S.C. 1691 et seq.) (relating to the Job

Corps).

‘‘(vi) The Carl D. Perkins Vocational and

Applied Technology Education Act (20 U.S.C.

2301 et seq.).

‘‘(vii) The Adult Education Act (20 U.S.C.

1201 et seq.).

‘‘(viii) Part B of chapter 1 of title I of the

Elementary and Secondary Education Act of

1965 (20 U.S.C. 2741 et seq.) (relating to Even

Start family literacy programs).

‘‘(ix) Subtitle A of title VII of the Stewart

B. McKinney Homeless Assistance Act (42

U.S.C. 11421) (relating to adult education for

the homeless).

‘‘(x) Subtitle B of title VII of such Act (42

U.S.C. 11431 et seq.) (relating to education

for homeless children and youth).

‘‘(xi) Subtitle C of title VII of such Act (42

U.S.C. 11441) (relating to job training for the

homeless).

‘‘(xii) The School-to-Work Opportunities

Act of 1994.

‘‘(xiii) The National and Community Service Act of 1990 (42 U.S.C. 12501 et seq.).

‘‘(xiv) The National Skill Standards Act of

1994.

‘‘(B) COORDINATION.—In utilizing appropriate Federal or State one-stop employment

shops described in subparagraph (A), the

State shall ensure coordination between the

caseworker of each program participant and

the administrators of the programs carried

out under the provisions of law described in

such subparagraph.

‘‘(11) NONDISPLACEMENT.—The program

may not be operated in a manner that results in—

‘‘(A) the displacement of a currently employed worker or position by a program participant;

‘‘(B) the replacement of an employee who

has been terminated with a program participant; or

‘‘(C) the replacement of an individual who

is on layoff from the same position given to

a program participant or any equivalent position.

‘‘SEC. 492. REVAMPED JOBS PROGRAM.

‘‘A State that establishes a program under

this subpart may operate a program similar

to the program known as the ‘GAIN Program’ that has been operated by Riverside

County, California, under Federal law in effect immediately before the date this subpart first applies to the State of California.

‘‘SEC. 493. USE OF PLACEMENT COMPANIES.

‘‘(a) IN GENERAL.—A State that establishes

a program under this subpart may enter into

contracts with private companies (whether

operated for profit or not for profit) for the

placement of participants in the program in

positions of full-time employment, preferably in the private sector, for wages sufficient to eliminate the need of such participants for cash assistance.

‘‘(b) REQUIRED CONTRACT TERMS.—Each

contract entered into under this section with

a company shall meet the following requirements:

‘‘(1) PROVISION OF JOB READINESS AND SUPPORT SERVICES.—The contract shall require

the company to provide, to any program participant who presents to the company a

voucher issued under subsection (d) intensive

personalized support and job readiness services designed to prepare the individual for

employment and ensure the continued success of the individual in employment.

‘‘(2) PAYMENTS.—

‘‘(A) IN GENERAL.—The contract shall provide for payments to be made to the company with respect to each program participant who presents to the company a voucher

issued under subsection (d).

‘‘(B) STRUCTURE.—The contract shall provide for the majority of the amounts to be

paid under the contract with respect to a

program participant, to be paid after the

company has placed the participant in a position of full-time employment and the participant has been employed in the position

for such period of not less than 5 months as

the State deems appropriate.

‘‘(c) COMPETITIVE BIDDING REQUIRED.—Contracts under this section shall be awarded

only after competitive bidding.
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T49.12 MARCH 23

‘‘(d) VOUCHERS.—The State shall issue a

voucher to each program participant whose

agreement of mutual responsibility provides

for the use of placement companies under

this section, indicating that the participant

is eligible for the services of such a company.

‘‘SEC. 494. TEMPORARY SUBSIDIZED JOB CREATION.

‘‘A State that establishes a program under

this subpart may establish a program similar

to the program known as ‘JOBS Plus’ that

has been operated by the State of Oregon

under Federal law in effect immediately before the date this subpart first applies to the

State of Oregon.

‘‘SEC. 495. MICROENTERPRISE.

‘‘(a) GRANTS AND LOANS TO NONPROFIT ORGANIZATIONS FOR THE PROVISION OF TECHNICAL ASSISTANCE, TRAINING, AND CREDIT TO

LOW INCOME ENTREPRENEURS.—A State that

establishes a program under this subpart

may make grants and loans to nonprofit organizations to provide technical assistance,

training, and credit to low income entrepreneurs for the purpose of establishing

microenterprises.

‘‘(b) MICROENTERPRISE DEFINED.—For purposes of this subsection, the term ‘microenterprise’ means a commercial enterprise

which has 5 or fewer employees, 1 or more of

whom owns the enterprise.

‘‘SEC. 496. WORK SUPPLEMENTATION PROGRAM.

‘‘(a) IN GENERAL.—A State that establishes

a program under this subpart may institute

a work supplementation program under

which the State, to the extent it considers

appropriate, may reserve the sums that

would otherwise be payable to participants

in the program as aid to families with dependent children and use the sums instead

for the purpose of providing and subsidizing

jobs for the participants (as described in subsection (c)(3)(A) and (B)), as an alternative

to the aid to families with dependent children that would otherwise be so payable to

the participants.

‘‘(b) STATE FLEXIBILITY.—

‘‘(1) Nothing in this subpart, or in any

State plan approved under part A, shall be

construed to prevent a State from operating

(on such terms and conditions and in such

cases as the State may find to be necessary

or appropriate) a work supplementation program in accordance with this section and

section 494 (as in effect immediately before

the date this subpart first applies to the

State).

‘‘(2) Notwithstanding section 402(a)(23) or

any other provision of law, a State may adjust the levels of the standards of need under

the State plan as the State determines to be

necessary and appropriate for carrying out a

work supplementation program under this

section.

‘‘(3) Notwithstanding section 402(a)(1) or

any other provision of law, a State operating

a work supplementation program under this

section may provide that the need standards

in effect in those areas of the State in which

the program is in operation may be different

from the need standards in effect in the

areas in which the program is not in operation, and the State may provide that the

need standards for categories of recipients

may vary among such categories to the extent the State determines to be appropriate

on the basis of ability to participate in the

work supplementation program.

‘‘(4) Notwithstanding any other provision

of law, a State may make such further adjustments in the amounts of the aid to families with dependent children paid under the

plan to different categories of recipients (as

determined under paragraph (3)) in order to

offset increases in benefits from needs-related programs (other than the State plan

approved under part A) as the State determines to be necessary and appropriate to further the purposes of the work supplementation program.

‘‘(5) In determining the amounts to be reserved and used for providing and subsidizing

jobs under this section as described in subsection (a), the State may use a sampling

methodology.

‘‘(6) Notwithstanding section 402(a)(8) or

any other provision of law, a State operating

a work supplementation program under this

section—

‘‘(A) may reduce or eliminate the amount

of earned income to be disregarded under the

State plan as the State determines to be necessary and appropriate to further the purposes of the work supplementation program;

and

‘‘(B) during 1 or more of the first 9 months

of an individual’s employment pursuant to a

program under this subpart, may apply to

the wages of the individual the provisions of

subparagraph (A)(iv) of section 402(a)(8)

without regard to the provisions of subparagraph (B)(ii)(II) of such section.

‘‘(c) RULES RELATING TO SUPPLEMENTED

JOBS.—

‘‘(1) A work supplementation program operated by a State under this section may

provide that any individual who is an eligible individual (as determined under paragraph (2)) shall take a supplemented job (as

defined in paragraph (3)) to the extent that

supplemented jobs are available under the

program. Payments by the State to individuals or to employers under the work supplementation program shall be treated as expenditures incurred by the State for aid to

families with dependent children except as

limited by subsection (d).

‘‘(2) For purposes of this section, an eligible individual is an individual who is in a

category which the State determines should

be eligible to participate in the work supplementation program, and who would, at

the time of placement in the job involved, be

eligible for aid to families with dependent

children under an approved State plan if the

State did not have a work supplementation

program in effect.

‘‘(3) For purposes of this subsection, a supplemented job is—

‘‘(A) a job provided to an eligible individual by the State or local agency administering the State plan under part A; or

‘‘(B) a job provided to an eligible individual by any other employer for which all

or part of the wages are paid by the State or

local agency.

A State may provide or subsidize under the

program any job which the State determines

to be appropriate.

‘‘(4) At the option of the State, individuals

who hold supplemented jobs under a State’s

work supplementation program shall be exempt from the retrospective budgeting requirements imposed pursuant to section

402(a)(13)(A)(ii) (and the amount of the aid

which is payable to the family of any such

individual for any month, or which would be

so payable but for the individual’s participation in the work supplementation program,

shall be determined on the basis of the income and other relevant circumstances in

that month).

‘‘(d) COST LIMITATION.—The amount of the

Federal payment to a State under section 403

for expenditures incurred in making payments to individuals and employers under a

work supplementation program under this

subsection shall not exceed an amount equal

to the amount which would otherwise be

payable under such section if the family of

each individual employed in the program established in the State under this section had

received the maximum amount of aid to families with dependent children payable under

the State plan to such a family with no income (without regard to adjustments under

subsection (b)) for the lesser of—

‘‘(1) 9 months; or

‘‘(2) the number of months in which the individual was employed in the program.

‘‘(e) RULES OF INTERPRETATION.—

‘‘(1) This section shall not be construed as

requiring the State or local agency administering the State plan to provide employee

status to an eligible individual to whom the

State or local agency provides a job under

the work supplementation program (or with

respect to whom the State or local agency

provides all or part of the wages paid to the

individual by another entity under the program), or as requiring any State or local

agency to provide that an eligible individual

filling a job position provided by another entity under the program be provided employee

status by the entity during the first 13 weeks

the individual fills the position.

‘‘(2) Wages paid under a work supplementation program shall be considered to be

earned income for purposes of any provision

of law.

‘‘(f) PRESERVATION OF MEDICAID ELIGIBILITY.—Any State that chooses to operate a

work supplementation program under this

section shall provide that any individual who

participates in the program, and any child or

relative of the individual (or other individual

living in the same household as the individual) who would be eligible for aid to families with dependent children under the State

plan approved under part A if the State did

not have a work supplementation program,

shall be considered individuals receiving aid

to families with dependent children under

the State plan approved under part A for

purposes of eligibility for medical assistance

under the State plan approved under title

XIX.

‘‘SEC. 497. PARTICIPATION RULES.

‘‘(a) IN GENERAL.—Except as provided in

subsection (b), a State that establishes a program under this part may require any individual receiving aid under the State plan approved under part A to participate in the

program.

‘‘(b) 2-YEAR LIMITATION ON PARTICIPATION.—

‘‘(1) IN GENERAL.—Except as provided in

paragraph (2), an individual may not participate in a State program established under

this part if the individual has participated in

the State program established under this

part for 24 months after the date the individual first signed an agreement of mutual

responsibility under this part, excluding any

month during which the individual worked

for an average of at least 25 hours per week

in a private sector job.

‘‘(2) AUTHORITY TO ALLOW REPEAT PARTICIPATION.—

‘‘(A) IN GENERAL.—Subject to subparagraph

(B) of this paragraph, a State may allow an

individual who, by reason of paragraph (1),

would be prohibited from participating in

the State program established under this

part to participate in the program for such

additional period or periods as the State determines appropriate.

‘‘(B) LIMITATION ON PERCENTAGE OF REPEAT

PARTICIPANTS.—

‘‘(i) IN GENERAL.—Except as provided in

clause (ii) of this subparagraph, the number

of individuals allowed under subparagraph

(A) to participate during a program year in

a State program established under this part

shall not exceed—

‘‘(I) 10 percent of the total number of individuals who participated in the State program established under this part or the

State program established under part H during the immediately preceding program

year; or

‘‘(II) in the case of fiscal year 2004 or any

succeeding fiscal year, 15 percent of such

total number of individuals.

‘‘(ii) AUTHORITY TO INCREASE LIMITATION.—
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1995 T49.12

‘‘(I) PETITION.—A State may request the

Secretary to increase to not more than 15

percent the percentage limitation imposed

by clause (i)(I) for a fiscal year before fiscal

year 2004.

‘‘(II) AUTHORITY TO GRANT REQUEST.—The

Secretary may approve a request made pursuant to subclause (I) if the Secretary deems

it appropriate. The Secretary shall develop

recommendations on the criteria that should

be applied in evaluating requests under subclause (I).

‘‘SEC. 498. CASELOAD PARTICIPATION RATES;

PERFORMANCE MEASURES.

‘‘(a) PARTICIPATION RATES.—

‘‘(1) REQUIREMENT.—A State that operates

a program under this part shall achieve a

participation rate for the following fiscal

years of not less than the following percentage:

‘‘Fiscal year: Percentage:

1997 .................................................. 16

1998 .................................................. 20

1999 .................................................. 24

2000 .................................................. 28

2001 .................................................. 32

2002 .................................................. 40

2003 or later .................................... 52.

‘‘(2) PARTICIPATION RATE DEFINED.—

‘‘(A) IN GENERAL.—As used in this subsection, the term ‘participation rate’ means,

with respect to a State and a fiscal year, an

amount equal to—

‘‘(i) the average monthly number of individuals who, during the fiscal year, participate in the State program established under

this part or the State program (if any) established under part H; divided by

‘‘(ii) the average monthly number of individuals for whom an individual responsibility plan is in effect under section 482 during the fiscal year.

‘‘(B) SPECIAL RULE.—For each of the 1st 12

months after an individual ceases to receive

aid under a State plan approved under part A

by reason of having become employed for

more than 25 hours per week in an unsubsidized job in the private sector, the individual shall be considered to be participating

in the State program established under this

part, and to be an adult recipient of such aid,

for purposes of subparagraph (A).

‘‘(3) STATE COMPLIANCE REPORTS.—Each

State that operates a program under this

part for a fiscal year shall submit to the Secretary a report on the participation rate of

the State for the fiscal year.

‘‘(4) EFFECT OF FAILURE TO MEET PARTICIPATION RATES.—

‘‘(A) IN GENERAL.—If a State reports that

the State has failed to achieve the participation rate required by paragraph (1) for the

fiscal year, the Secretary may make recommendations for changes in the State program established under this part and (if the

State has established a program under part

H) the State program established under part

H. The State may elect to follow such recommendations, and shall demonstrate to the

Secretary how the State will achieve the required participation rates.

‘‘(B) SECOND CONSECUTIVE FAILURE.—Notwithstanding subparagraph (A), if a State

fails to achieve the participation rate required by paragraph (1) for 2 consecutive fiscal years, the Secretary may—

‘‘(i) require the State to make changes in

the State program established under this

part and (if the State has established a program under part H) the State program established under part H; and

‘‘(ii) reduce by 5 percent the amount otherwise payable to the State under paragraph

(1) or (2) (whichever applies to the State) of

section 403(a).

‘‘(b) PERFORMANCE STANDARDS.—The Secretary shall develop standards to be used to

measure the effectiveness of the programs

established under this part and part H in

moving recipients of aid under the State

plan approved under part A into full-time

unsubsidized employment.

‘‘(c) PERFORMANCE-BASED MEASURES.—

‘‘(1) ESTABLISHMENT.—The Secretary shall,

by regulation, establish measures of the effectiveness of the State programs established under this part and under part H in

moving recipients of aid under the State

plan approved under part A into full-time

unsubsidized employment, based on the performance of such programs.

‘‘(2) ANNUAL COMPLIANCE REPORTS.—Each

State that operates a program under this

part shall submit to the Secretary annual reports that compare the achievements of the

program with the performance-based measures established under paragraph (1).

‘‘Subpart 2—Optional State Plans

‘‘SEC. 499. STATE ROLE.

‘‘(a) PROGRAM REQUIREMENTS.—Any State

may establish and operate a work first program that meets the following requirements,

unless the State is operating a work first

program under subpart 1:

‘‘(1) OBJECTIVE.—The objective of the program is for each program participant to find

and hold a full-time unsubsidized paid job,

and for this goal to be achieved in a cost-effective fashion.

‘‘(2) METHOD.—The method of the program

is to connect recipients of aid to families

with dependent children with the private

sector labor market as soon as possible and

offer them the support and skills necessary

to remain in the labor market. Each component of the program should be permeated

with an emphasis on employment and with

an understanding that minimum wage jobs

are a stepping stone to more highly paid employment. The program shall provide recipients with education, training, job search and

placement, wage supplementation, temporary subsidized jobs, or such other services

that the State deems necessary to help a recipient obtain private sector employment.

‘‘(3) JOB CREATION.—The creation of jobs,

with an emphasis on private sector jobs,

shall be a component of the program and

shall be a priority for each State office with

responsibilities under the program.

‘‘(4) FORMS OF ASSISTANCE.—The State

shall provide assistance to participants in

the program in the form of education, training, job placement services (including vouchers for job placement services), work supplementation programs, temporary subsidized job creation, job counseling, assistance in establishing microenterprises, or

other services to provide individuals with

the support and skills necessary to obtain

and keep employment in the private sector.

‘‘(5) 2-YEAR LIMITATION ON PARTICIPATION.—

The program shall comply with section

497(b).

‘‘(6) AGREEMENTS OF MUTUAL RESPONSIBILITY.—

‘‘(A) IN GENERAL.—The State agency shall

develop an agreement of mutual responsibility for each program participant, which

will be an individualized comprehensive

plan, developed by the team and the participant, to move the participant into a fulltime unsubsidized job. The agreement should

detail the education, training, or skills that

the individual will be receiving to obtain a

full-time unsubsidized job, and the obligations of the individual.

‘‘(B) HOURS OF PARTICIPATION REQUIREMENT.—The agreement shall provide that the

individual shall participate in activities in

accordance with the agreement for—

‘‘(i) not fewer than 20 hours per week during fiscal years 1997 and 1998;

‘‘(ii) not fewer than 25 hours per week during fiscal year 1999; and

‘‘(iii) not fewer than 30 hours per week

thereafter.

‘‘(7) CASELOAD PARTICIPATION RATES.—The

program shall comply with section 498.

‘‘(8) NONDISPLACEMENT.—The program shall

comply with section 491(11).

‘‘(b) ANNUAL REPORTS.—

‘‘(1) COMPLIANCE WITH PERFORMANCE MEASURES.—Each State that operates a program

under this subpart shall submit to the Secretary annual reports that compare the

achievements of the program with the performance-based measures established under

section 490(b).

‘‘(2) COMPLIANCE WITH PARTICIPATION

RATES.—Each State that operates a program

under this subpart for a fiscal year shall submit to the Secretary a report on the participation rate of the State for the fiscal year.

‘‘SEC. 500. FEDERAL ROLE.

‘‘(a) APPROVAL OF STATE PLANS.—

‘‘(1) IN GENERAL.—Within 60 days after the

date a State submits to the Secretary a plan

that provides for the establishment and operation of a work first program that meets the

requirements of section 499, the Secretary

shall approve the plan.

‘‘(2) AUTHORITY TO EXTEND APPROVAL DEADLINE.—The 60-day deadline established in

paragraph (1) with respect to a State may be

extended in accordance with an agreement

between the Secretary and the State.

‘‘(b) PERFORMANCE-BASED MEASURES.—The

Secretary shall, by regulation, establish

measures of the effectiveness of the State

program established under this subpart and

(if the State has established a program under

part H) the State program established under

part H in moving recipients of aid under the

State plan approved under part A into fulltime unsubsidized employment, based on the

performance of such programs.

‘‘(c) EFFECT OF FAILURE TO MEET PARTICIPATION RATES.—

‘‘(1) IN GENERAL.—If a State reports that

the State has failed to achieve the participation rate required by section 499(a)(7) for the

fiscal year, the Secretary may make recommendations for changes in the State program established under this subpart and (if

the State has established a program under

part H) the State program established under

part H. The State may elect to follow such

recommendations, and shall demonstrate to

the Secretary how the State will achieve the

required participation rates.

‘‘(2) SECOND CONSECUTIVE FAILURE.—Notwithstanding paragraph (1), if the State has

failed to achieve the participation rates required by section 499(a)(7) for 2 consecutive

fiscal years, the Secretary may require the

State to make changes in the State program

established under this subpart and (if the

State has established a program under part

H) the State program established under part

H.

‘‘Part H—Workfare Program

‘‘SEC. 500A. ESTABLISHMENT AND OPERATION OF

PROGRAM.

‘‘(a) IN GENERAL.—A State that establishes

a work first program under a subpart of part

G may establish and carry out a workfare

program that meets the requirements of this

part, unless the State has established a job

placement voucher program under part I.

‘‘(b) OBJECTIVE.—The objective of the

workfare program is for each program participant to find and hold a full-time unsubsidized paid job, and for this goal to be

achieved in a cost-effective fashion.

‘‘(c) CASE MANAGEMENT TEAMS.—The State

shall assign to each program participant a

case management team that shall meet with

the participant and assist the participant to

choose the most suitable workfare job under

subsection (e), (f), or (g) and to eventually

obtain a full-time unsubsidized paid job.

‘‘(d) PROVISION OF JOBS.—The State shall

provide each participant in the program with
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a community service job that meets the requirements of subsection (e) or a subsidized

job that meets the requirements of subsection (f) or (g).

‘‘(e) COMMUNITY SERVICE JOBS.—

‘‘(1) IN GENERAL.—Except as provided in

paragraphs (2) and (3), each participant shall

work for not fewer than 30 hours per week

(or, at the option of the State, 20 hours per

week during fiscal years 1997 and 1998, not

fewer than 25 hours per week during fiscal

year 1999, not fewer than 30 hours per week

during fiscal years 2000 and 2001, and not

fewer than 35 hours per week thereafter) in a

community service job, and be paid at a rate

which is not greater than 75 percent (or, at

the option of the State, 100 percent) of the

maximum amount of aid payable under the

State plan approved under part A to a family

of the same size and composition with no income.

‘‘(2) EXCEPTION.—(A) If the participant has

obtained unsubsidized part-time employment

in the private sector, the State shall provide

the participant with a part-time community

service job.

‘‘(B) If the State provides a participant a

part-time community service job under subparagraph (A), the State shall ensure that

the participant works for not fewer than 30

hours per week.

‘‘(3) WAGES NOT CONSIDERED EARNED INCOME.—Wages paid under a workfare program

shall not be considered to be earned income

for purposes of any provision of law.

‘‘(4) COMMUNITY SERVICE JOB DEFINED.—For

purposes of this section, the term ‘community service job’ means—

‘‘(A) a job provided to a participant by the

State administering the State plan under

part A; or

‘‘(B) a job provided to a participant by any

other employer for which all or part of the

wages are paid by the State.

A State may provide or subsidize under the

program any job which the State determines

to be appropriate.

‘‘(f) TEMPORARY SUBSIDIZED JOB CREATION.—A State that establishes a workfare

program under this part may establish a program similar to the program operated by the

State of Oregon, which is known as ‘JOBS

Plus’.

‘‘(g) WORK SUPPLEMENTATION PROGRAM.—

‘‘(1) IN GENERAL.—A State that establishes

a workfare program under this part may institute a work supplementation program

under which the State, to the extent it considers appropriate, may reserve the sums

that would otherwise be payable to participants in the program as a community service

minimum wage and use the sums instead for

the purpose of providing and subsidizing private sector jobs for the participants.

‘‘(2) EMPLOYER AGREEMENT.—An employer

who provides a private sector job to a participant under paragraph (1) shall agree to provide to the participant an amount in wages

equal to the poverty threshold for a family

of three.

‘‘(h) JOB SEARCH REQUIREMENT.—The State

shall require each participant to spend a

minimum of 5 hours per week on activities

related to securing unsubsidized full-time

employment in the private sector.

‘‘(i) DURATION OF PARTICIPATION.—

‘‘(1) IN GENERAL.—Except as provided in

paragraph (2), an individual may not participate for more than 2 years in a workfare program under this part.

‘‘(2) AUTHORITY TO ALLOW REPEATED PARTICIPATION.—

‘‘(A) IN GENERAL.—Subject to subparagraph

(B), a State may allow an individual who, by

reason of paragraph (1), would be prohibited

from participating in the State program established under this part to participate in

the program for such additional period or periods as the State determines appropriate.

‘‘(B) LIMITATION ON PERCENTAGE OF REPEAT

PARTICIPANTS.—

‘‘(i) IN GENERAL.—Except as provided in

clause (ii), the number of individuals allowed

under subparagraph (A) to participate during

a program year in a State program established under this part shall not exceed 10 percent of the total number of individuals who

participated in the program during the immediately preceding program year.

‘‘(ii) AUTHORITY TO INCREASE LIMITATION.—

‘‘(I) PETITION.—A State may request the

Secretary to increase the percentage limitation imposed by clause (i) to not more than

15 percent.

‘‘(II) AUTHORITY TO GRANT REQUEST.—The

Secretary may approve a request made pursuant to subclause (I) if the Secretary deems

it appropriate. The Secretary shall develop

recommendations on the criteria that should

be applied in evaluating requests under subclause (I).

‘‘(j) USE OF PLACEMENT COMPANIES.—A

State that establishes a workfare program

under this part may enter into contracts

with private companies (whether operated

for profit or not for profit) for the placement

of participants in the program in positions of

full-time employment, preferably in the private sector, for wages sufficient to eliminate

the need of such participants for cash assistance in accordance with section 493.

‘‘(k) MAXIMUM OF 3 COMMUNITY SERVICE

JOBS.—A program participant may not receive more than 3 community service jobs

under the program.

‘‘Part I—Job Placement Voucher Program

‘‘SEC. 500B. JOB PLACEMENT VOUCHER PROGRAM.

‘‘A State that is not operating a workfare

program under part H may establish a job

placement voucher program that meets the

following requirements:

‘‘(1) The program shall offer each program

participant a voucher which the participant

may use to obtain employment in the private sector.

‘‘(2) An employer who receives a voucher

issued under the program from an individual

may redeem the voucher at any time after

the individual has been employed by the employer for 6 months, unless another employee of the employer was displaced by the

employment of the individual.

‘‘(3) Upon presentation of a voucher by an

employer to the State agency responsible for

the administration of the program, the State

agency shall pay to the employer an amount

equal to 50 percent of the total amount of aid

paid under the State plan approved under

part A to the family of which the individual

is a member for the most recent 12 months

for which the family was eligible for such

aid.’’.

(c) FUNDING.—Section 403 (42 U.S.C. 603) is

amended by inserting after subsection (b) the

following:

‘‘(c)(1) Each State that is operating a program in accordance with subpart 1 of part G

(or in accordance with a plan approved under

subpart 2 of part G), and a program in accordance with part H or I shall be entitled to

payments under subsection (d) for any fiscal

year in an amount equal to the sum of the

applicable percentages (specified in such subsection) of its expenditures to carry out such

programs (subject to limitations prescribed

by or pursuant to such parts or this section

on expenditures that may be included for

purposes of determining payment under subsection (d)), but such payments for any fiscal

year in the case of any State may not exceed

the limitation determined under paragraph

(2) with respect to the State.

‘‘(2) The limitation determined under this

paragraph with respect to a State for any fiscal year is the amount that bears the same

ratio to the amount specified in paragraph

(3) for such fiscal year as the average monthly number of adult recipients (as defined in

paragraph (4)) in the State in the preceding

fiscal year bears to the average monthly

number of such recipients in all the States

for such preceding year.

‘‘(3)(A) The amount specified in this paragraph is—

‘‘(i) $1,500,000,000 for fiscal year 1997;

‘‘(iii) $2,000,000,000 for fiscal year 1998;

‘‘(iv) $2,600,000,000 for fiscal year 1999;

‘‘(v) $3,100,000,000 for fiscal year 2000; and

‘‘(vi) the amount determined under subparagraph (B) for fiscal year 2001 and each

succeeding fiscal year.

‘‘(B) The amount determined under this

subparagraph for a fiscal year is the product

of the following:

‘‘(i) The amount specified in this paragraph

for the immediately preceding fiscal year.

‘‘(ii) 1.00 plus the percentage (if any) by

which—

‘‘(I) the average of the Consumer Price

Index (as defined in section 1(f)(5) of the Internal Revenue Code of 1986) for the most recent 12-month period for which such information is available; exceeds

‘‘(II) the average of the Consumer Price

Index (as so defined) for the 12-month period

ending on June 30 of the 2nd preceding fiscal

year.

‘‘(iii) The amount that bears the same

ratio to the amount specified in this paragraph for the immediately preceding fiscal

year as the number of individuals whom the

Secretary estimates will participate in programs operated under part G, H, or I during

the fiscal year bears to the total number of

individuals who participated in such programs during such preceding fiscal year.

‘‘(4) For purposes of this subsection, the

term ‘adult recipient’ in the case of any

State means an individual other than a dependent child (unless such child is the custodial parent of another dependent child)

whose needs are met (in whole or in part)

with payments of aid to families with dependent children.

‘‘(d)(1) In lieu of any payment under subsection (a), the Secretary shall pay to each

State that is operating a program in accordance with subpart 1 of part G (or in accordance with a plan approved under subpart 2 of

part G), and a program in accordance with

part H or I, and to which section 1108 does

not apply, with respect to expenditures by

the State to carry out such programs, an

amount equal to 70 percent, or the Federal

medical assistance percentage (as defined in

section 1905(b)) increased by 10 percentage

points, whichever is the greater, of the total

amount expended during the quarter for the

operation and administration of such programs.

‘‘(2) In lieu of any payment under subsection (a), the Secretary shall pay to each

State that is operating a program in accordance with subpart 1 of part G (or in accordance with a plan approved under subpart 2 of

part G), and a program in accordance with

part H or I, and to which section 1108 applies,

with respect to expenditures by the State to

carry out such programs (including expenditures for child care under section

402(g)(1)(A)), an amount equal to—

‘‘(A) with respect to so much of such expenditures in a fiscal year as do not exceed

the State’s expenditures in the fiscal year

1987 with respect to which payments were

made to such State from its allotment for

such fiscal year pursuant to part C of this

title as then in effect, 90 percent; and

‘‘(B) with respect to so much of such expenditures in a fiscal year as exceed the

amount described in subparagraph (A)—

‘‘(i) 50 percent, in the case of expenditures

for administrative costs made by a State in

operating such programs for such fiscal year

(other than the personnel costs for staff em-
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449

1995 T49.12

ployed full-time in the operation of such program) and the costs of transportation and

other work-related supportive services under

section 402(g)(2); and

‘‘(ii) 70 percent or the Federal medical assistance percentage (as defined in the last

sentence of section 1118) increased by 10 percentage points, whichever is the greater, in

the case of expenditures made by a State in

operating such programs for such fiscal year

(other than for costs described in clause (i)).

‘‘(3) With respect to the amount for which

payment is made to a State under paragraph

(2)(A), the State’s expenditures for the costs

of operating such programs may be in cash

or in kind, fairly evaluated.

‘‘(4) Not more than 10 percent of the

amount payable to a State under this subsection for a quarter may be for expenditures

made during the quarter with respect to program participants who are not eligible for

aid under the State plan approved under part

A.’’.

(d) SECRETARY’S SPECIAL ADJUSTMENT

FUND.—Section 403 (42 U.S.C. 603) is amended

by adding at the end the following:

‘‘(p)(1) There shall be available to the Secretary from the amount appropriated for

payments under subsection (c) for States’

programs under parts G and H for fiscal year

1996, $300,000,000 for special adjustments to

States’ limitations on Federal payments for

such programs.

‘‘(2) A State may, not later than March 1

and September 1 of each fiscal year, submit

to the Secretary a request to adjust the limitation on payments under this section with

respect to its program under part G (and, in

fiscal years after 1997) its program under

part H for the following fiscal year. The Secretary shall only consider such a request

from a State which has, or which demonstrates convincingly on the basis of estimates that it will, submit allowable claims

for Federal payment in the full amount

available to it under subsection (c) in the

current fiscal year and obligated 95 percent

of its full amount in the prior fiscal year.

The Secretary shall by regulation prescribe

criteria for the equitable allocation among

the States of Federal payments pursuant to

adjustments of the limitations referred to in

the preceding sentence in the case where the

requests of all States that the Secretary

finds reasonable exceed the amount available, and, within 30 days following the dates

specified in this paragraph, will notify each

State whether one or more of its limitations

will be adjusted in accordance with the

State’s request and the amount of the adjustment (which may be some or all of the

amount requested).

‘‘(3) The Secretary may adjust the limitation on Federal payments to a State for a

fiscal year under subsection (c), and upon a

determination by the Secretary that (and

the amount by which) a State’s limitation

should be raised, the amount specified in either such subsection, or both, shall be considered to be so increased for the following

fiscal year.

‘‘(4) The amount made available under

paragraph (1) for special adjustments shall

remain available to the Secretary until expended. That amount shall be reduced by the

sum of the adjustments approved by the Secretary in any fiscal year, and the amount

shall be increased in a fiscal year by the

amount by which all States’ limitations

under subsection (c) of this section and section 2008 for a fiscal year exceeded the sum

of the Federal payments under such provisions of law for such fiscal year, but for fiscal years after 1997, such amount at the end

of such fiscal year shall not exceed

$400,000,000.’’.

(e) CONFORMING AMENDMENTS.—

(1) Section 402(a) (42 U.S.C. 602(a)) is

amended by striking paragraph (19).

(2) Section 403 (42 U.S.C. 603) is amended by

striking subsections (k) and (l).

(3) Section 407(b)(1)(B) (42 U.S.C.

607(b)(1)(B)) is amended—

(A) by adding ‘‘and’’ at the end of clause

(iii);

(B) by striking ‘‘; and’’ at the end of clause

(iv) and inserting a period; and

(C) by striking clause (v).

(4) Section 407(b)(2)(B)(ii)(I) (42 U.S.C.

607(b)(2)(B)(ii)(I)) is amended by striking

‘‘under section 402(a)(19) or’’.

(5) Section 407(b)(2)(C) (42 U.S.C.

607(b)(2)(C)) is amended by striking ‘‘section

402(a)(19) and’’.

(6) Section 1115(b)(2)(A) (42 U.S.C.

1315(b)(2)(A)) is amended by striking ‘‘, and

402(a)(19) (relating to the work incentive program)’’.

(7) Section 1108 (42 U.S.C. 1308) is

amended—

(A) in subsection (a), by striking ‘‘or, in

the case of part A of title IV, section 403(k)’’;

and

(B) in subsection (d), by striking ‘‘(exclusive of any amounts on account of services

and items to which, in the case of part A of

such title, section 403(k) applies)’’.

(8) Section 1902(a)(19)(A)(i)(I) (42 U.S.C.

1396a(a)(19)(A)(i)(I)) is amended by striking

‘‘482(e)(6)’’ and inserting ‘‘486(f)’’.

(9) Section 1928(a)(1) (42 U.S.C. 1396s(a)(1))

is amended by striking ‘‘482(e)(6)’’ and inserting ‘‘486(f)’’.

(f) INTENT OF THE CONGRESS.—The Congress

intends for State activities under section 494

of the Social Security Act (as added by the

amendment made by section 301(b) of this

Act) to emphasize the use of the funds that

would otherwise be used to provide individuals with aid to families with dependent

children under part A of title IV of the Social Security Act and with food stamp benefits under the Food Stamp Act of 1977, to

subsidize the wages of such individuals in

temporary jobs.

(g) SENSE OF THE CONGRESS.—It is the sense

of the Congress that States should target individuals who have not attained 25 years of

age for participation in the program established by the State under part G of title IV

of the Social Security Act (as added by the

amendment made by section 301(b) of this

section) in order to break the cycle of welfare dependency.

SEC. 302. REGULATIONS.

The Secretary of Health and Human Services shall prescribe such regulations as may

be necessary to implement the amendments

made by this title.

SEC. 303. APPLICABILITY TO STATES.

(a) STATE OPTION TO ACCELERATE APPLICABILITY.—If a State formally notifies the Secretary of Health and Human Services that

the State desires to accelerate the applicability to the State of the amendments made

by this title, the amendments shall apply to

the State on and after such earlier date as

the State may select.

(b) STATE OPTION TO DELAY APPLICABILITY

UNTIL WAIVERS EXPIRE.—The amendments

made by this title shall not apply to a State

with respect to which there is in effect a

waiver issued under section 1115 of the Social

Security Act for the State program established under part G of title IV of such Act,

until the waiver expires, if the State formally notifies the Secretary of Health and

Human Services that the State desires to so

delay such effective date.

(c) AUTHORITY OF THE SECRETARY OF

HEALTH AND HUMAN SERVICES TO DELAY APPLICABILITY TO A STATE.—If a State formally

notifies the Secretary of Health and Human

Services that the State desires to delay the

applicability to the State of the amendments

made by this title, the amendments shall

apply to the State on and after any later

date agreed upon by the Secretary and the

State.

SEC. 304. SENSE OF THE CONGRESS RELATING TO

AVAILABILITY OF WORK FIRST PROGRAM IN RURAL AREAS.

It is the sense of the Congress that the

Secretary of Health and Human Services and

the States should consider the needs of rural

areas in designing State plans under part G

of title IV of the Social Security Act.

SEC. 305. GRANTS TO COMMUNITY-BASED ORGANIZATIONS.

(a) IN GENERAL.—The Secretary of Health

and Human Services may make grants in accordance with this section to communitybased organizations that move recipients of

aid to families with dependent children

under a State plan approved under part A of

title IV of the Social Security Act or under

other public assistance programs into private sector work.

(b) AUTHORIZATION OF APPROPRIATIONS.—

There are authorized to be appropriated to

carry out this section $25,000,000 for fiscal

year 1996 and $50,000,000 for fiscal years 1997,

1998, 1999, and 2000.

(c) ELIGIBLE ORGANIZATIONS.—The Secretary of Health and Human Services shall

award grants to community-based organizations that—

(1) receive at least 5 percent of their funding from local government sources; and

(2) move recipients referred to in subsection (a) in the direction of unsubsidized

private employment by integrating and colocating at least 5 of the following services—

(A) case management;

(B) job training;

(C) child care;

(D) housing;

(E) health care services;

(F) nutrition programs;

(G) life skills training; and

(H) parenting skills.

(d) AWARDING OF GRANTS.—

(1) IN GENERAL.—The Secretary shall award

grants based on the quality of applications,

subject to paragraphs (2) and (3).

(2) PREFERENCE IN AWARDING GRANTS.—In

awarding grants under this section, the Secretary shall give preference to organizations

which receive more than 50 percent of their

funding from State government, local government or private sources.

(3) DISTRIBUTION OF GRANT.—The Secretary

shall award at least 1 grant to each State

from which the Secretary received an application.

(4) LIMITATION ON SIZE OF GRANT.—The Secretary shall not award any grants under this

section of more than $1,000,000.

(e) ISSUANCE OF REGULATIONS.—Not less

than 6 months after the date of the enactment of this section, the Secretary shall prescribe such regulations as may be necessary

to implement this section.

TITLE IV—FAMILY RESPONSIBILITY AND

IMPROVED CHILD SUPPORT ENFORCEMENT

Subtitle A—Eligibility and Other Matters

Concerning Title IV–D Program Clients

SEC. 401. STATE OBLIGATION TO PROVIDE PATERNITY ESTABLISHMENT AND

CHILD SUPPORT ENFORCEMENT

SERVICES.

(a) STATE LAW REQUIREMENTS.—Section

466(a) (42 U.S.C. 666(a)) is amended by inserting after paragraph (11) the following:

‘‘(12) USE OF CENTRAL CASE REGISTRY AND

CENTRALIZED COLLECTIONS UNIT.—Procedures

under which—

‘‘(A) every child support order established

or modified in the State on or after October

1, 1998, is recorded in the central case registry established in accordance with section

454A(e); and

‘‘(B) child support payments are collected

through the centralized collections unit established in accordance with section 454B—
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‘‘(i) on and after October 1, 1998, under each

order subject to wage withholding under section 466(b); and

‘‘(ii) on and after October 1, 1999, under

each other order required to be recorded in

such central case registry under this paragraph or section 454A(e), except as provided

in subparagraph (C); and

‘‘(C)(i) parties subject to a child support

order described in subparagraph (B)(ii) may

opt out of the procedure for payment of support through the centralized collections unit

(but not the procedure for inclusion in the

central case registry) by filing with the

State agency a written agreement, signed by

both parties, to an alternative payment procedure; and

‘‘(ii) an agreement described in clause (i)

becomes void whenever either party advises

the State agency of an intent to vacate the

agreement.’’.

(b) STATE PLAN REQUIREMENTS.—Section

454 (42 U.S.C. 654) is amended—

(1) by striking paragraph (4) and inserting

the following:

‘‘(4) provide that such State will

undertake—

‘‘(A) to provide appropriate services under

this part to—

‘‘(i) each child with respect to whom an assignment is effective under section 402(a)(26),

471(a)(17), or 1912 (except in cases where the

State agency determines, in accordance with

paragraph (25), that it is against the best interests of the child to do so); and

‘‘(ii) each child not described in clause (i)—

‘‘(I) with respect to whom an individual applies for such services; and

‘‘(II) (on and after October 1, 1998) each

child with respect to whom a support order

is recorded in the central State case registry

established under section 454A, regardless of

whether application is made for services

under this part; and

‘‘(B) to enforce the support obligation established with respect to the custodial parent of a child described in subparagraph (A)

unless the parties to the order which establishes the support obligation have opted, in

accordance with section 466(a)(12)(C), for an

alternative payment procedure.’’; and

(2) in paragraph (6)—

(A) by striking subparagraph (A) and inserting the following:

‘‘(A) services under the State plan shall be

made available to nonresidents on the same

terms as to residents;’’;

(B) in subparagraph (B)—

(i) by inserting ‘‘on individuals not receiving assistance under part A’’ after ‘‘such

services shall be imposed’’; and

(ii) by inserting ‘‘but no fees or costs shall

be imposed on any absent or custodial parent

or other individual for inclusion in the central State registry maintained pursuant to

section 454A(e)’’; and

(C) in each of subparagraphs (B), (C), and

(D)—

(i) by indenting such subparagraph and

aligning its left margin with the left margin

of subparagraph (A); and

(ii) by striking the final comma and inserting a semicolon.

(c) CONFORMING AMENDMENTS.—

(1) Section 452(g)(2)(A) (42 U.S.C.

652(g)(2)(A)) is amended by striking ‘‘454(6)’’

each place it appears and inserting

‘‘454(4)(A)(ii)’’.

(2) Section 454(23) (42 U.S.C. 654(23)) is

amended, effective October 1, 1998, by striking ‘‘information as to any application fees

for such services and’’.

(3) Section 466(a)(3)(B) (42 U.S.C.

666(a)(3)(B)) is amended by striking ‘‘in the

case of overdue support which a State has

agreed to collect under section 454(6)’’ and

inserting ‘‘in any other case’’.

(4) Section 466(e) (42 U.S.C. 666(e)) is

amended by striking ‘‘or (6)’’.

SEC. 402. DISTRIBUTION OF PAYMENTS.

(a) DISTRIBUTIONS THROUGH STATE CHILD

SUPPORT ENFORCEMENT AGENCY TO FORMER

ASSISTANCE RECIPIENTS.—Section 454(5) (42

U.S.C. 654(5)) is amended—

(1) in subparagraph (A)—

(A) by inserting ‘‘except as otherwise specifically provided in section 464 or 466(a)(3),’’

after ‘‘is effective,’’; and

(B) by striking ‘‘except that’’ and all that

follows through the semicolon; and

(2) in subparagraph (B), by striking ‘‘, except’’ and all that follows through ‘‘medical

assistance’’.

(b) DISTRIBUTION TO A FAMILY CURRENTLY

RECEIVING AFDC.—Section 457 (42 U.S.C. 657)

is amended—

(1) by striking subsection (a) and redesignating subsection (b) as subsection (a);

(2) in subsection (a), as redesignated—

(A) in the matter preceding paragraph (2),

to read as follows:

‘‘(a) IN THE CASE OF A FAMILY RECEIVING

AFDC.—Amounts collected under this part

during any month as support of a child who

is receiving assistance under part A (or a

parent or caretaker relative of such a child)

shall (except in the case of a State exercising

the option under subsection (b)) be distributed as follows:

‘‘(1) an amount equal to the amount that

will be disregarded pursuant to section

402(a)(8)(A)(vi) shall be taken from each of—

‘‘(A) amounts received in a month which

represent payments for that month; and

‘‘(B) amounts received in a month which

represent payments for a prior month which

were made by the absent parent in the

month when due;

and shall be paid to the family without affecting its eligibility for assistance or decreasing any amount otherwise payable as

assistance to such family during such

month;’’;

(B) in paragraph (4), by striking ‘‘or (B)’’

and all that follows and inserting ‘‘; then (B)

from any remainder, amounts equal to arrearages of such support obligations assigned, pursuant to part A, to any other

State or States shall be paid to such other

State or States and used to pay any such arrearages (with appropriate reimbursement of

the Federal Government to the extent of its

participation in the financing); and then (C)

any remainder shall be paid to the family.’’.

(3) by inserting after subsection (a), as redesignated, the following new subsection:

‘‘(b) ALTERNATIVE DISTRIBUTION IN CASE OF

FAMILY RECEIVING AFDC.—In the case of a

State electing the option under this subsection, amounts collected as described in

subsection (a) shall be distributed as follows:

‘‘(1) an amount equal to the amount that

will be disregarded pursuant to section

402(a)(8)(A)(vi) shall be taken from each of—

‘‘(A) amounts received in a month which

represent payments for that month; and

‘‘(B) amounts received in a month which

represent payments for a prior month which

were made by the absent parent in the

month when due;

and shall be paid to the family without affecting its eligibility for assistance or decreasing any amount otherwise payable as

assistance to such family during such

month;

‘‘(2) second, from any remainder, amounts

equal to the balance of support owed for the

current month shall be paid to the family;

‘‘(3) third, from any remainder, amounts

equal to arrearages of such support obligations assigned, pursuant to part A, to the

State making the collection shall be retained and used by such State to pay any

such arrearages (with appropriate reimbursement of the Federal Government to the extent of its participation in the financing);

‘‘(4) fourth, from any remainder, amounts

equal to arrearages of such support obligations assigned, pursuant to part A, to any

other State or States shall be paid to such

other State or States and used to pay any

such arrearages (with appropriate reimbursement of the Federal Government to the extent of its participation in the financing);

and

‘‘(5) fifth, any remainder shall be paid to

the family.’’.

(c) DISTRIBUTION TO A FAMILY NOT RECEIVING AFDC.—

(1) IN GENERAL.—Section 457(c) (42 U.S.C.

657(c)) is amended to read as follows:

‘‘(c) IN CASE OF FAMILY NOT RECEIVING

AFDC.—Amounts collected by a State agency under this part during any month as support of a child who is not receiving assistance under part A (or of a parent or caretaker relative of such a child) shall (subject

to the remaining provisions of this section)

be distributed as follows:

‘‘(1) first, amounts equal to the total of

such support owed for such month shall be

paid to the family;

‘‘(2) second, from any remainder, amounts

equal to arrearages of such support obligations for months during which such child did

not receive assistance under part A shall be

paid to the family;

‘‘(3) third, from any remainder, amounts

equal to arrearages of such support obligations assigned to the State making the collection pursuant to part A shall be retained

and used by such State to pay any such arrearages (with appropriate reimbursement of

the Federal Government to the extent of its

participation in the financing);

‘‘(4) fourth, from any remainder, amounts

equal to arrearages of such support obligations assigned to any other State pursuant

to part A shall be paid to such other State or

States, and used to pay such arrearages, in

the order in which such arrearages accrued

(with appropriate reimbursement of the Federal Government to the extent of its participation in the financing).’’.

(2) EFFECTIVE DATE.—The amendment

made by paragraph (1) shall take effect on

October 1, 1999.

(d) DISTRIBUTION TO A CHILD RECEIVING ASSISTANCE UNDER PART E.—Section 457(d) (42

U.S.C. 657(d)) is amended, in the matter preceding paragraph (1), by striking ‘‘Notwithstanding the preceding provisions of this section, amounts’’ and inserting the following:

‘‘(d) IN CASE OF A CHILD RECEIVING ASSISTANCE UNDER PART E.—Amounts’’.

(e) SUSPENSION OR CANCELLATION OF DEBTS

UPON MARRIAGE OF PARENTS.—Section 457 (42

U.S.C. 657) is amended by adding at the end

the following:

‘‘(e) SUSPENSION OR CANCELLATION OF

DEBTS TO STATE UPON MARRIAGE OF PARENTS.—

‘‘(1) CIRCUMSTANCES REQUIRING SUSPENSION

OR CANCELLATION.—In any case in which a

State has been assigned rights to support

owed with respect to a child who is receiving

or has received assistance under part A and—

‘‘(A) the parent owing such support marries (or remarries) the parent with whom

such child is living and to whom such support is owed and applies to the State for relief under this subsection;

‘‘(B) the State determines (in accordance

with procedures and criteria established by

the Secretary) that the marriage is not a

sham marriage entered into solely to satisfy

this subsection; and

‘‘(C) the combined income of such parents

is less than twice the Federal poverty line,

the State shall afford relief to the parent

owing such support in accordance with paragraph (2).

‘‘(2) SUSPENSION OR CANCELLATION.—In the

case of a marriage or remarriage described in

paragraph (1), the State shall either—

‘‘(A) cancel all debts owed to the State

pursuant to such assignment; or
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1995 T49.12

‘‘(B) suspend collection of such debts for

the duration of such marriage, and cancel

such debts if such duration extends beyond

the end of the period with respect to which

support is owed.

‘‘(3) NOTICE REQUIRED.—The State shall notify custodial parents of children who are receiving aid under part A of the relief available under this subsection to individuals who

marry (or remarry).’’.

(f) STATE OPTIONS TO PASS THROUGH AND

TO DISREGARD CHILD SUPPORT AMOUNTS.—

(1) STATE OPTION TO PASS THROUGH CHILD

SUPPORT.—Section 457(b)(1) (42 U.S.C.

657(b)(1)) is amended to read as follows:

‘‘(1) at State option, an amount determined by the State, equal to all or a portion

of the monthly support obligation, may be

paid to the family from each of—

‘‘(A) amounts received in a month which

represent payments for that month; and

‘‘(B) amounts received in a month which

represent payments for a prior month which

were made by the absent parent in the

month when due;’’.

(2) STATE OPTION TO DISREGARD CHILD SUPPORT.—Section 402(a)(8)(A)(vi) (42 U.S.C

602(a)(8)(A)(vi)) is amended—

(A) by striking ‘‘shall disregard the first

$50’’ and inserting ‘‘may disregard all or any

portion’’;

(B) by striking ‘‘the first $50’’ and inserting ‘‘and all or any portion’’; and

(C) by striking ‘‘section 457(b)’’ and inserting ‘‘section 457(a)’’.

(g) PASS THROUGH AND DISREGARD OF SUPPORT COLLECTED ON BEHALF OF A FAMILY

SUBJECT TO THE FAMILY CAP.—

(1) PASS THROUGH.—Section 457 (42 U.S.C.

657), as amended by subsection (e) of this section, is amended by adding at the end the

following:

‘‘(f) PASS THROUGH OF SUPPORT COLLECTED

ON BEHALF OF A FAMILY SUBJECT TO THE FAMILY CAP.—Amounts collected by a State

agency under this part during any month as

support of a child who is a member of a 1-

parent family subject to section 402(a)(51)

shall be distributed to the family.’’.

(2) DISREGARD.—Section 402(a)(8)(A)(vi) (42

U.S.C. 602(a)(8)(A)(vi)) is amended by inserting ‘‘, except that, in the case of a 1-parent

family subject to paragraph (51), all support

payments collected and paid to the family

under section 457(f) shall be disregarded’’ before the semicolon.

(h) REGULATIONS.—The Secretary of Health

and Human Services shall promulgate

regulations—

(1) under part D of title IV of the Social

Security Act, establishing a uniform nationwide standard for allocation of child support

collections from an obligor owing support to

more than one family; and

(2) under part A of such title, establishing

standards applicable to States electing the

alternative formula under section 457(b) of

such Act for distribution of collections on

behalf of families receiving Aid to Families

with Dependent Children, designed to minimize irregular monthly payments to such

families.

(i) CLERICAL AMENDMENT.—Section 454 (42

U.S.C. 654) is amended—

(1) in paragraph (11), by striking ‘‘(11)’’ and

inserting ‘‘(11)(A)’’; and

(2) by redesignating paragraph (12) as subparagraph (B) of paragraph (11).

SEC. 403. DUE PROCESS RIGHTS.

(a) IN GENERAL.—Section 454 (42 U.S.C. 654),

as amended by section 402(f) of this Act, is

amended by inserting after paragraph (11)

the following new paragraph:

‘‘(12) provide for procedures to ensure

that—

‘‘(A) individuals who are applying for or receiving services under this part, or are parties to cases in which services are being provided under this part—

‘‘(i) receive notice of all proceedings in

which support obligations might be established or modified; and

‘‘(ii) receive a copy of any order establishing or modifying a child support obligation, or (in the case of a petition for modification) a notice of determination that

there should be no change in the amount of

the child support award, within 14 days after

issuance of such order or determination;

‘‘(B) individuals applying for or receiving

services under this part have access to a fair

hearing that meets standards established by

the Secretary and ensures prompt consideration and resolution of complaints (but the

resort to such procedure shall not stay the

enforcement of any support order); and

‘‘(C) individuals adversely affected by the

establishment or modification of (or, in the

case of a petition for modification, the determination that there should be no change in)

a child support order shall be afforded not

less than 30 days after the receipt of the

order or determination to initiate proceedings to challenge such order or determination;’’.

(b) EFFECTIVE DATE.—The amendment

made by subsection (a) shall become effective on October 1, 1997.

SEC. 404. PRIVACY SAFEGUARDS.

(a) STATE PLAN REQUIREMENT.—Section 454

(42 U.S.C. 454) is amended—

(1) by striking ‘‘and’’ at the end of paragraph (23);

(2) by striking the period at the end of

paragraph (24) and inserting ‘‘; and’’; and

(3) by adding after paragraph (24) the following:

‘‘(25) will have in effect safeguards applicable to all sensitive and confidential information handled by the State agency designed to

protect the privacy rights of the parties,

including—

‘‘(A) safeguards against unauthorized use

or disclosure of information relating to proceedings or actions to establish paternity, or

to establish or enforce support;

‘‘(B) prohibitions on the release of information on the whereabouts of one party to another party against whom a protective order

with respect to the former party has been entered; and

‘‘(C) prohibitions on the release of information on the whereabouts of one party to another party if the State has reason to believe

that the release of the information may result in physical or emotional harm to the

former party.’’.

(b) EFFECTIVE DATE.—The amendment

made by subsection (a) shall become effective on October 1, 1997.

Subtitle B—Program Administration and

Funding

SEC. 411. FEDERAL MATCHING PAYMENTS.

(a) INCREASED BASE MATCHING RATE.—Section 455(a)(2) (42 U.S.C. 655(a)(2)) is amended

to read as follows:

‘‘(2) The applicable percent for a quarter

for purposes of paragraph (1)(A) is—

‘‘(A) for fiscal year 1997, 69 percent,

‘‘(B) for fiscal year 1998, 72 percent, and

‘‘(C) for fiscal year 1999 and succeeding fiscal years, 75 percent.’’.

(b) MAINTENANCE OF EFFORT.—Section 455

(42 U.S.C. 655) is amended—

(1) in subsection (a)(1), in the matter preceding subparagraph (A), by striking ‘‘From’’

and inserting ‘‘Subject to subsection (c),

from’’; and

(2) by inserting after subsection (b) the following new subsection:

‘‘(c) MAINTENANCE OF EFFORT.—Notwithstanding the provisions of subsection (a),

total expenditures for the State program

under this part for fiscal year 1997 and each

succeeding fiscal year, reduced by the percentage specified for such fiscal year under

subsection (a)(2)(A), (B), or (C)(i), shall not

be less than such total expenditures for fiscal year 1996, reduced by 66 percent.’’.

SEC. 412. PERFORMANCE-BASED INCENTIVES

AND PENALTIES.

(a) INCENTIVE ADJUSTMENTS TO FEDERAL

MATCHING RATE.—Section 458 (42 U.S.C. 658)

is amended to read as follows:

‘‘INCENTIVE ADJUSTMENTS TO MATCHING RATE

‘‘SEC. 458. (a) INCENTIVE ADJUSTMENT.—(1)

IN GENERAL.—In order to encourage and reward State child support enforcement programs which perform in an effective manner,

the Federal matching rate for payments to a

State under section 455(a)(1)(A), for each fiscal year beginning on or after October 1,

1998, shall be increased by a factor reflecting

the sum of the applicable incentive adjustments (if any) determined in accordance

with regulations under this section with respect to Statewide paternity establishment

and to overall performance in child support

enforcement.

‘‘(2) STANDARDS.—(A) IN GENERAL.—The

Secretary shall specify in regulations—

‘‘(i) the levels of accomplishment, and

rates of improvement as alternatives to such

levels, which States must attain to qualify

for incentive adjustments under this section;

and

‘‘(ii) the amounts of incentive adjustment

that shall be awarded to States achieving

specified accomplishment or improvement

levels, which amounts shall be graduated,

ranging up to—

‘‘(I) 5 percentage points, in connection

with Statewide paternity establishment; and

‘‘(II) 10 percentage points, in connection

with overall performance in child support

enforcement.

‘‘(B) LIMITATION.—In setting performance

standards pursuant to subparagraph (A)(i)

and adjustment amounts pursuant to subparagraph (A)(ii), the Secretary shall ensure

that the aggregate number of percentage

point increases as incentive adjustments to

all States do not exceed such aggregate increases as assumed by the Secretary in estimates of the cost of this section as of June

1995, unless the aggregate performance of all

States exceeds the projected aggregate performance of all States in such cost estimates.

‘‘(3) DETERMINATION OF INCENTIVE ADJUSTMENT.—The Secretary shall determine the

amount (if any) of incentive adjustment due

each State on the basis of the data submitted by the State pursuant to section

454(15)(B) concerning the levels of accomplishment (and rates of improvement) with

respect to performance indicators specified

by the Secretary pursuant to this section.

‘‘(4) FISCAL YEAR SUBJECT TO INCENTIVE

ADJUSTMENT.—The total percentage point increase determined pursuant to this section

with respect to a State program in a fiscal

year shall apply as an adjustment to the applicable percent under section 455(a)(2) for

payments to such State for the succeeding

fiscal year.

‘‘(5) RECYCLING OF INCENTIVE ADJUSTMENT.—A State shall expend in the State

program under this part all funds paid to the

State by the Federal Government as a result

of an incentive adjustment under this section.

‘‘(b) MEANING OF TERMS.—For purposes of

this section—

‘‘(1) the term ‘Statewide paternity establishment percentage’ means, with respect to

a fiscal year, the ratio (expressed as a percentage) of—

‘‘(A) the total number of out-of-wedlock

children in the State under one year of age

for whom paternity is established or acknowledged during the fiscal year, to

‘‘(B) the total number of children born out

of wedlock in the State during such fiscal

year; and
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‘‘(2) the term ‘overall performance in child

support enforcement’ means a measure or

measures of the effectiveness of the State

agency in a fiscal year which takes into account factors including—

‘‘(A) the percentage of cases requiring a

child support order in which such an order

was established;

‘‘(B) the percentage of cases in which child

support is being paid;

‘‘(C) the ratio of child support collected to

child support due; and

‘‘(D) the cost-effectiveness of the State

program, as determined in accordance with

standards established by the Secretary in

regulations.’’.

(b) ADJUSTMENT OF PAYMENTS UNDER PART

D OF TITLE IV.—Section 455(a)(2) (42 U.S.C.

655(a)(2)), as amended by section 411(a) of

this Act, is amended—

(1) by striking the period at the end of subparagraph (C)(ii) and inserting a comma; and

(2) by adding after and below subparagraph

(C), flush with the left margin of the subsection, the following:

‘‘increased by the incentive adjustment factor (if any) determined by the Secretary pursuant to section 458.’’.

(c) CONFORMING AMENDMENTS.—Section

454(22) (42 U.S.C. 654(22)) is amended—

(1) by striking ‘‘incentive payments’’ the

first place it appears and inserting ‘‘incentive adjustments’’; and

(2) by striking ‘‘any such incentive payments made to the State for such period’’

and inserting ‘‘any increases in Federal payments to the State resulting from such incentive adjustments’’.

(d) CALCULATION OF IV–D PATERNITY ESTABLISHMENT PERCENTAGE.—(1) Section

452(g)(1) (42 U.S.C. 652(g)(1)) is amended in

the matter preceding subparagraph (A) by inserting ‘‘its overall performance in child support enforcement is satisfactory (as defined

in section 458(b) and regulations of the Secretary), and’’ after ‘‘1994,’’.

(2) Section 452(g)(2) (42 U.S.C. 652(g)(2)) is

amended—

(A) in subparagraph (A), in the matter preceding clause (i)—

(i) by striking ‘‘paternity establishment

percentage’’ and inserting ‘‘IV–D paternity

establishment percentage’’; and

(ii) by striking ‘‘(or all States, as the case

may be)’’;

(B) in subparagraph (A)(i), by striking

‘‘during the fiscal year’’;

(C) in subparagraph (A)(ii)(I), by striking

‘‘as of the end of the fiscal year’’ and inserting ‘‘in the fiscal year or, at the option of

the State, as of the end of such year’’;

(D) in subparagraph (A)(ii)(II), by striking

‘‘or (E) as of the end of the fiscal year’’ and

inserting ‘‘in the fiscal year or, at the option

of the State, as of the end of such year’’;

(E) in subparagraph (A)(iii)—

(i) by striking ‘‘during the fiscal year’’;

and

(ii) by striking ‘‘and’’ at the end; and

(F) in the matter following subparagraph

(A)—

(i) by striking ‘‘who were born out of wedlock during the immediately preceding fiscal

year’’ and inserting ‘‘born out of wedlock’’;

(ii) by striking ‘‘such preceding fiscal

year’’ both places it appears and inserting

‘‘the preceding fiscal year’’; and

(iii) by striking ‘‘or (E)’’ the second place

it appears.

(3) Section 452(g)(3) (42 U.S.C. 652(g)(3)) is

amended—

(A) by striking subparagraph (A) and redesignating subparagraphs (B) and (C) as subparagraphs (A) and (B), respectively;

(B) in subparagraph (A), as redesignated,

by striking ‘‘the percentage of children born

out-of-wedlock in the State’’ and inserting

‘‘the percentage of children in the State who

are born out of wedlock or for whom support

has not been established’’; and

(C) in subparagraph (B), as redesignated—

(i) by inserting ‘‘and overall performance

in child support enforcement’’ after ‘‘paternity establishment percentages’’; and

(ii) by inserting ‘‘and securing support’’ before the period.

(e) REDUCTION OF PAYMENTS UNDER PART D

OF TITLE IV.—

(1) NEW REQUIREMENTS.—Section 455 (42

U.S.C. 655) is amended by inserting after subsection (b) the following:

‘‘(c)(1) If the Secretary finds, with respect

to a State program under this part in a fiscal

year beginning on or after October 1, 1997—

‘‘(A)(i) on the basis of data submitted by a

State pursuant to section 454(15)(B), that the

State program in such fiscal year failed to

achieve the IV–D paternity establishment

percentage (as defined in section 452(g)(2)(A))

or the appropriate level of overall performance in child support enforcement (as defined in section 458(b)(2)), or to meet other

performance measures that may be established by the Secretary, or

‘‘(ii) on the basis of an audit or audits of

such State data conducted pursuant to section 452(a)(4)(C), that the State data submitted pursuant to section 454(15)(B) is incomplete or unreliable; and

‘‘(B) that, with respect to the succeeding

fiscal year—

‘‘(i) the State failed to take sufficient corrective action to achieve the appropriate

performance levels as described in subparagraph (A)(i) of this paragraph, or

‘‘(ii) the data submitted by the State pursuant to section 454(15)(B) is incomplete or

unreliable,

the amounts otherwise payable to the State

under this part for quarters following the

end of such succeeding fiscal year, prior to

quarters following the end of the first quarter throughout which the State program is

in compliance with such performance requirement, shall be reduced by the percentage specified in paragraph (2).

‘‘(2) The reductions required under paragraph (1) shall be—

‘‘(A) not less than 6 nor more than 8 percent, or

‘‘(B) not less than 8 nor more than 12 percent, if the finding is the second consecutive

finding made pursuant to paragraph (1), or

‘‘(C) not less than 12 nor more than 15 percent, if the finding is the third or a subsequent consecutive such finding.

‘‘(3) For purposes of this subsection, section 402(a)(27), and section 452(a)(4), a State

which is determined as a result of an audit

to have submitted incomplete or unreliable

data pursuant to section 454(15)(B), shall be

determined to have submitted adequate data

if the Secretary determines that the extent

of the incompleteness or unreliability of the

data is of a technical nature which does not

adversely affect the determination of the

level of the State’s performance.’’.

(2) CONFORMING AMENDMENTS.—

(A) Section 403 (42 U.S.C. 603) is amended

by striking subsection (h).

(B) Section 452(a)(4) (42 U.S.C. 652(a)(4)) is

amended by striking ‘‘403(h)’’ each place

such term appears and inserting ‘‘455(c)’’.

(C) Subsections (d)(3)(A), (g)(1), and

(g)(3)(A) of section 452 (42 U.S.C. 652) are each

amended by striking ‘‘403(h)’’ and inserting

‘‘455(c)’’.

(f) EFFECTIVE DATES.—

(1) INCENTIVE ADJUSTMENTS.—(A) The

amendments made by subsections (a), (b),

and (c) shall become effective October 1, 1997,

except to the extent provided in subparagraph (B).

(B) Section 458 of the Social Security Act,

as in effect prior to the enactment of this

section, shall be effective for purposes of incentive payments to States for fiscal years

prior to fiscal year 1999.

(2) PENALTY REDUCTIONS.—(A) The amendments made by subsection (d) shall become

effective with respect to calendar quarters

beginning on and after the date of enactment

of this Act.

(B) The amendments made by subsection

(e) shall become effective with respect to calendar quarters beginning on and after the

date one year after the date of enactment of

this Act.

SEC. 413. FEDERAL AND STATE REVIEWS AND AUDITS.

(a) STATE AGENCY ACTIVITIES.—Section 454

(42 U.S.C. 654) is amended—

(1) in paragraph (14), by striking ‘‘(14)’’ and

inserting ‘‘(14)(A)’’;

(2) by redesignating paragraph (15) as subparagraph (B) of paragraph (14); and

(3) by inserting after paragraph (14) the following new paragraph:

‘‘(15) provide for—

‘‘(A) a process for annual reviews of and reports to the Secretary on the State program

under this part, which shall include such information as may be necessary to measure

State compliance with Federal requirements

for expedited procedures and timely case

processing, using such standards and procedures as are required by the Secretary, under

which the State agency will determine the

extent to which such program is in conformity with applicable requirements with

respect to the operation of State programs

under this part (including the status of complaints filed under the procedure required

under paragraph (12)(B)); and

‘‘(B) a process of extracting from the State

automated data processing system and

transmitting to the Secretary data and calculations concerning the levels of accomplishment (and rates of improvement) with

respect to applicable performance indicators

(including IV–D paternity establishment percentages and overall performance in child

support enforcement) to the extent necessary for purposes of sections 452(g) and

458.’’.

(b) FEDERAL ACTIVITIES.—Section 452(a)(4)

(42 U.S.C. 652(a)(4)) is amended to read as follows:

‘‘(4)(A) review data and calculations transmitted by State agencies pursuant to section

454(15)(B) on State program accomplishments with respect to performance indicators for purposes of section 452(g) and 458,

and determine the amount (if any) of penalty

reductions pursuant to section 455(c) to be

applied to the State;

‘‘(B) review annual reports by State agencies pursuant to section 454(15)(A) on State

program conformity with Federal requirements; evaluate any elements of a State program in which significant deficiencies are indicated by such report on the status of complaints under the State procedure under section 454(12)(B); and, as appropriate, provide

to the State agency comments, recommendations for additional or alternative corrective

actions, and technical assistance; and

‘‘(C) conduct audits, in accordance with

the government auditing standards of the

United States Comptroller General—

‘‘(i) at least once every 3 years (or more

frequently, in the case of a State which fails

to meet requirements of this part, or of regulations implementing such requirements,

concerning performance standards and reliability of program data) to assess the completeness, reliability, and security of the

data, and the accuracy of the reporting systems, used for the calculations of performance indicators specified in subsection (g)

and section 458;

‘‘(ii) of the adequacy of financial management of the State program, including assessments of—
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‘‘(I) whether Federal and other funds made

available to carry out the State program

under this part are being appropriately expended, and are properly and fully accounted

for; and

‘‘(II) whether collections and disbursements of support payments and program income are carried out correctly and are properly and fully accounted for; and

‘‘(iii) for such other purposes as the Secretary may find necessary;’’.

(c) EFFECTIVE DATE.—The amendments

made by this section shall be effective with

respect to calendar quarters beginning on or

after the date one year after enactment of

this section.

SEC. 414. REQUIRED REPORTING PROCEDURES.

(a) ESTABLISHMENT.—Section 452(a)(5) (42

U.S.C. 652(a)(5)) is amended by inserting ‘‘,

and establish procedures to be followed by

States for collecting and reporting information required to be provided under this part,

and establish uniform definitions (including

those necessary to enable the measurement

of State compliance with the requirements

of this part relating to expedited processes

and timely case processing) to be applied in

following such procedures’’ before the semicolon.

(b) STATE PLAN REQUIREMENT.—Section 454

(42 U.S.C. 654), as amended by section 404(a)

of this Act, is amended—

(1) by striking ‘‘and’’ at the end of paragraph (24);

(2) by striking the period at the end of

paragraph (25) and inserting ‘‘; and’’; and

(3) by adding after paragraph (25) the following:

‘‘(26) provide that the State shall use the

definitions established under section 452(a)(5)

in collecting and reporting information as

required under this part.’’.

SEC. 415. AUTOMATED DATA PROCESSING REQUIREMENTS.

(a) REVISED REQUIREMENTS.—(1) Section

454(16) (42 U.S.C. 654(16)) is amended—

(A) by striking ‘‘, at the option of the

State,’’;

(B) by inserting ‘‘and operation by the

State agency’’ after ‘‘for the establishment’’;

(C) by inserting ‘‘meeting the requirements

of section 454A’’ after ‘‘information retrieval

system’’;

(D) by striking ‘‘in the State and localities

thereof, so as (A)’’ and inserting ‘‘so as’’;

(E) by striking ‘‘(i)’’; and

(F) by striking ‘‘(including’’ and all that

follows and inserting a semicolon.

(2) Part D of title IV (42 U.S.C. 651–669) is

amended by inserting after section 454 the

following new section:

‘‘AUTOMATED DATA PROCESSING

‘‘SEC. 454A. (a) IN GENERAL.—In order to

meet the requirements of this section, for

purposes of the requirement of section

454(16), a State agency shall have in operation a single statewide automated data

processing and information retrieval system

which has the capability to perform the

tasks specified in this section, and performs

such tasks with the frequency and in the

manner specified in this part or in regulations or guidelines of the Secretary.

‘‘(b) PROGRAM MANAGEMENT.—The automated system required under this section

shall perform such functions as the Secretary may specify relating to management

of the program under this part, including—

‘‘(1) controlling and accounting for use of

Federal, State, and local funds to carry out

such program; and

‘‘(2) maintaining the data necessary to

meet Federal reporting requirements on a

timely basis.

‘‘(c) CALCULATION OF PERFORMANCE INDICATORS.—In order to enable the Secretary to

determine the incentive and penalty adjustments required by sections 452(g) and 458, the

State agency shall—

‘‘(1) use the automated system—

‘‘(A) to maintain the requisite data on

State performance with respect to paternity

establishment and child support enforcement

in the State; and

‘‘(B) to calculate the IV–D paternity establishment percentage and overall performance

in child support enforcement for the State

for each fiscal year; and

‘‘(2) have in place systems controls to ensure the completeness, and reliability of, and

ready access to, the data described in paragraph (1)(A), and the accuracy of the calculations described in paragraph (1)(B).

‘‘(d) INFORMATION INTEGRITY AND SECURITY.—The State agency shall have in effect

safeguards on the integrity, accuracy, and

completeness of, access to, and use of data in

the automated system required under this

section, which shall include the following (in

addition to such other safeguards as the Secretary specifies in regulations):

‘‘(1) POLICIES RESTRICTING ACCESS.—Written

policies concerning access to data by State

agency personnel, and sharing of data with

other persons, which—

‘‘(A) permit access to and use of data only

to the extent necessary to carry out program

responsibilities;

‘‘(B) specify the data which may be used

for particular program purposes, and the personnel permitted access to such data; and

‘‘(C) ensure that data obtained or disclosed

for a limited program purpose is not used or

redisclosed for another, impermissible purpose.

‘‘(2) SYSTEMS CONTROLS.—Systems controls

(such as passwords or blocking of fields) to

ensure strict adherence to the policies specified under paragraph (1).

‘‘(3) MONITORING OF ACCESS.—Routine monitoring of access to and use of the automated

system, through methods such as audit trails

and feedback mechanisms, to guard against

and promptly identify unauthorized access

or use.

‘‘(4) TRAINING AND INFORMATION.—The

State agency shall have in effect procedures

to ensure that all personnel (including State

and local agency staff and contractors) who

may have access to or be required to use sensitive or confidential program data are fully

informed of applicable requirements and penalties, and are adequately trained in security

procedures.

‘‘(5) PENALTIES.—The State agency shall

have in effect administrative penalties (up to

and including dismissal from employment)

for unauthorized access to, or disclosure or

use of, confidential data.’’.

(3) REGULATIONS.—Section 452 (42 U.S.C.

652) is amended by adding at the end the following:

‘‘(j) The Secretary shall prescribe final regulations for implementation of the requirements of section 454A not later than 2 years

after the date of the enactment of this subsection.’’.

(4) IMPLEMENTATION TIMETABLE.—Section

454(24) (42 U.S.C. 654(24)), as amended by sections 404(a)(2) and 414(b)(1) of this Act, is

amended to read as follows:

‘‘(24) provide that the State will have in effect an automated data processing and information retrieval system—

‘‘(A) by October 1, 1995, meeting all requirements of this part which were enacted

on or before the date of enactment of the

Family Support Act of 1988; and

‘‘(B) by October 1, 1999, meeting all requirements of this part enacted on or before

the date of enactment of the Individual Responsibility Act of 1995 (but this provision

shall not be construed to alter earlier deadlines specified for elements of such system),

except that such deadline shall be extended

by 1 day for each day (if any) by which the

Secretary fails to meet the deadline imposed

by section 452(j);’’.

(b) SPECIAL FEDERAL MATCHING RATE FOR

DEVELOPMENT COSTS OF AUTOMATED SYSTEMS.—Section 455(a) (42 U.S.C. 655(a)) is

amended—

(1) in paragraph (1)(B)—

(A) by striking ‘‘90 percent’’ and inserting

‘‘the percent specified in paragraph (3)’’;

(B) by striking ‘‘so much of’’; and

(C) by striking ‘‘which the Secretary’’ and

all that follows and inserting ‘‘, and’’; and

(2) by adding at the end the following new

paragraph:

‘‘(3)(A) The Secretary shall pay to each

State, for each quarter in fiscal year 1996, 90

percent of so much of State expenditures described in subparagraph (1)(B) as the Secretary finds are for a system meeting the requirements specified in section 454(16), or

meeting such requirements without regard

to clause (D) thereof.

‘‘(B)(i) The Secretary shall pay to each

State, for each quarter in fiscal years 1997

through 2001, the percentage specified in

clause (ii) of so much of State expenditures

described in subparagraph (1)(B) as the Secretary finds are for a system meeting the requirements specified in section 454(16) and

454A, subject to clause (iii).

‘‘(ii) The percentage specified in this

clause, for purposes of clause (i), is the higher of—

‘‘(I) 80 percent, or

‘‘(II) the percentage otherwise applicable

to Federal payments to the State under subparagraph (A) (as adjusted pursuant to section 458).’’.

(c) CONFORMING AMENDMENT.—Section

123(c) of the Family Support Act of 1988 (102

Stat. 2352; Public Law 100–485) is repealed.

(d) ADDITIONAL PROVISIONS.—For additional provisions of section 454A, as added by

subsection (a) of this section, see the amendments made by sections 421, 422(c), and 433(d)

of this Act.

SEC. 416. DIRECTOR OF CSE PROGRAM; STAFFING

STUDY.

(a) REPORTING TO SECRETARY.—Section

452(a) (42 U.S.C. 652(a)) is amended in the

matter preceding paragraph (1) by striking

‘‘directly’’.

(b) STAFFING STUDIES.—

(1) SCOPE.—The Secretary of Health and

Human Services shall, directly or by contract, conduct studies of the staffing of each

State child support enforcement program

under part D of title IV of the Social Security Act. Such studies shall include a review

of the staffing needs created by requirements

for automated data processing, maintenance

of a central case registry and centralized collections of child support, and of changes in

these needs resulting from changes in such

requirements. Such studies shall examine

and report on effective staffing practices

used by the States and on recommended

staffing procedures.

(2) FREQUENCY OF STUDIES.—The Secretary

shall complete the first staffing study required under paragraph (1) by October 1, 1997,

and may conduct additional studies subsequently at appropriate intervals.

(3) REPORT TO THE CONGRESS.—The Secretary shall submit a report to the Congress

stating the findings and conclusions of each

study conducted under this subsection.

SEC. 417. FUNDING FOR SECRETARIAL ASSISTANCE TO STATE PROGRAMS.

Section 452 (42 U.S.C. 652), as amended by

section 415(a)(3) of this Act, is amended by

adding at the end the following new subsection:

‘‘(k) FUNDING FOR FEDERAL ACTIVITIES ASSISTING STATE PROGRAMS.—(1) There shall be

available to the Secretary, from amounts appropriated for fiscal year 1996 and each succeeding fiscal year for payments to States

under this part, the amount specified in

paragraph (2) for the costs to the Secretary

for—
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‘‘(A) information dissemination and technical assistance to States, training of State

and Federal staff, staffing studies, and related activities needed to improve programs

(including technical assistance concerning

State automated systems);

‘‘(B) research, demonstration, and special

projects of regional or national significance

relating to the operation of State programs

under this part; and

‘‘(C) operation of the Federal Parent Locator Service under section 453, to the extent

such costs are not recovered through user

fees.

‘‘(2) The amount specified in this paragraph for a fiscal year is the amount equal to

a percentage of the reduction in Federal payments to States under part A on account of

child support (including arrearages) collected in the preceding fiscal year on behalf

of children receiving aid under such part A

in such preceding fiscal year (as determined

on the basis of the most recent reliable data

available to the Secretary as of the end of

the third calendar quarter following the end

of such preceding fiscal year), equal to—

‘‘(A) 1 percent, for the activities specified

in subparagraphs (A) and (B) of paragraph

(1); and

‘‘(B) 2 percent, for the activities specified

in subparagraph (C) of paragraph (1).’’.

SEC. 418. REPORTS AND DATA COLLECTION BY

THE SECRETARY.

(a) ANNUAL REPORT TO CONGRESS.—(1) Section 452(a)(10)(A) (42 U.S.C. 652(a)(10)(A)) is

amended—

(A) by striking ‘‘this part;’’ and inserting

‘‘this part, including—’’; and

(B) by adding at the end the following indented clauses:

‘‘(i) the total amount of child support payments collected as a result of services furnished during such fiscal year to individuals

receiving services under this part;

‘‘(ii) the cost to the States and to the Federal Government of furnishing such services

to those individuals; and

‘‘(iii) the number of cases involving

families—

‘‘(I) who became ineligible for aid under

part A during a month in such fiscal year;

and

‘‘(II) with respect to whom a child support

payment was received in the same month;’’.

(2) Section 452(a)(10)(C) (42 U.S.C.

652(a)(10)(C)) is amended—

(A) in the matter preceding clause (i)—

(i) by striking ‘‘with the data required

under each clause being separately stated for

cases’’ and inserting ‘‘separately stated for

(1) cases’’;

(ii) by striking ‘‘cases where the child was

formerly receiving’’ and inserting ‘‘or formerly received’’;

(iii) by inserting ‘‘or 1912’’ after

‘‘471(a)(17)’’; and

(iv) by inserting ‘‘(2)’’ before ‘‘all other’’;

(B) in each of clauses (i) and (ii), by striking ‘‘, and the total amount of such obligations’’;

(C) in clause (iii), by striking ‘‘described

in’’ and all that follows and inserting ‘‘in

which support was collected during the fiscal

year;’’;

(D) by striking clause (iv); and

(E) by redesignating clause (v) as clause

(vii), and inserting after clause (iii) the following new clauses:

‘‘(iv) the total amount of support collected

during such fiscal year and distributed as

current support;

‘‘(v) the total amount of support collected

during such fiscal year and distributed as arrearages;

‘‘(vi) the total amount of support due and

unpaid for all fiscal years; and’’.

(3) Section 452(a)(10)(G) (42 U.S.C.

652(a)(10)(G)) is amended by striking ‘‘on the

use of Federal courts and’’.

(4) Section 452(a)(10) (42 U.S.C. 652(a)(10)) is

amended by striking all that follows subparagraph (I).

(b) DATA COLLECTION AND REPORTING.—Section 469 (42 U.S.C. 669) is amended—

(1) by striking subsections (a) and (b) and

inserting the following:

‘‘(a) The Secretary shall collect and maintain, on a fiscal year basis, up-to-date statistics, by State, with respect to services to establish paternity and services to establish

child support obligations, the data specified

in subsection (b), separately stated, in the

case of each such service, with respect to—

‘‘(1) families (or dependent children) receiving aid under plans approved under part

A (or E); and

‘‘(2) families not receiving such aid.

‘‘(b) The data referred to in subsection (a)

are—

‘‘(1) the number of cases in the caseload of

the State agency administering the plan

under this part in which such service is needed; and

‘‘(2) the number of such cases in which the

service has been provided.’’; and

(2) in subsection (c), by striking ‘‘(a)(2)’’

and inserting ‘‘(b)(2)’’.

(c) EFFECTIVE DATE.—The amendments

made by this section shall be effective with

respect to fiscal year 1996 and succeeding fiscal years.

Subtitle C—Locate and Case Tracking

SEC. 421. CENTRAL STATE AND CASE REGISTRY.

Section 454A, as added by section 415(a)(2)

of this Act, is amended by adding at the end

the following:

‘‘(e) CENTRAL CASE REGISTRY.—(1) IN GENERAL.—The automated system required

under this section shall perform the functions, in accordance with the provisions of

this subsection, of a single central registry

containing records with respect to each case

in which services are being provided by the

State agency (including, on and after October 1, 1998, each order specified in section

466(a)(12)), using such standardized data elements (such as names, social security numbers or other uniform identification numbers, dates of birth, and case identification

numbers), and containing such other information (such as information on case status)

as the Secretary may require.

‘‘(2) PAYMENT RECORDS.—Each case record

in the central registry shall include a record

of—

‘‘(A) the amount of monthly (or other periodic) support owed under the support order,

and other amounts due or overdue (including

arrears, interest or late payment penalties,

and fees);

‘‘(B) the date on which or circumstances

under which the support obligation will terminate under such order;

‘‘(C) all child support and related amounts

collected (including such amounts as fees,

late payment penalties, and interest on arrearages);

‘‘(D) the distribution of such amounts collected; and

‘‘(E) the birth date of the child for whom

the child support order is entered.

‘‘(3) UPDATING AND MONITORING.—The State

agency shall promptly establish and maintain, and regularly monitor, case records in

the registry required by this subsection, on

the basis of—

‘‘(A) information on administrative actions

and administrative and judicial proceedings

and orders relating to paternity and support;

‘‘(B) information obtained from matches

with Federal, State, or local data sources;

‘‘(C) information on support collections

and distributions; and

‘‘(D) any other relevant information.

‘‘(f) DATA MATCHES AND OTHER DISCLOSURES OF INFORMATION.—The automated system required under this section shall have

the capacity, and be used by the State agency, to extract data at such times, and in such

standardized format or formats, as may be

required by the Secretary, and to share and

match data with, and receive data from,

other data bases and data matching services,

in order to obtain (or provide) information

necessary to enable the State agency (or

Secretary or other State or Federal agencies) to carry out responsibilities under this

part. Data matching activities of the State

agency shall include at least the following:

‘‘(1) DATA BANK OF CHILD SUPPORT ORDERS.—Furnish to the Data Bank of Child

Support Orders established under section

453(h) (and update as necessary, with information including notice of expiration of orders) minimal information (to be specified by

the Secretary) on each child support case in

the central case registry.

‘‘(2) FEDERAL PARENT LOCATOR SERVICE.—

Exchange data with the Federal Parent Locator Service for the purposes specified in

section 453.

‘‘(3) AFDC AND MEDICAID AGENCIES.—Exchange data with State agencies (of the

State and of other States) administering the

programs under part A and title XIX, as necessary for the performance of State agency

responsibilities under this part and under

such programs.

‘‘(4) INTRA- AND INTERSTATE DATA

MATCHES.—Exchange data with other agencies of the State, agencies of other States,

and interstate information networks, as necessary and appropriate to carry out (or assist

other States to carry out) the purposes of

this part.’’.

SEC. 422. CENTRALIZED COLLECTION AND DISBURSEMENT OF SUPPORT PAYMENTS.

(a) STATE PLAN REQUIREMENT.—Section 454

(42 U.S.C. 654), as amended by sections 404(a)

and 414(b) of this Act, is amended—

(1) by striking ‘‘and’’ at the end of paragraph (25);

(2) by striking the period at the end of

paragraph (26) and inserting ‘‘; and’’; and

(3) by adding after paragraph (26) the following new paragraph:

‘‘(27) provide that the State agency, on and

after October 1, 1998—

‘‘(A) will operate a centralized, automated

unit for the collection and disbursement of

child support under orders being enforced

under this part, in accordance with section

454B; and

‘‘(B) will have sufficient State staff (consisting of State employees), and (at State option) contractors reporting directly to the

State agency to monitor and enforce support

collections through such centralized unit, including carrying out the automated data

processing responsibilities specified in section 454A(g) and to impose, as appropriate in

particular cases, the administrative enforcement remedies specified in section

466(c)(1).’’.

(b) ESTABLISHMENT OF CENTRALIZED COLLECTION UNIT.—Part D of title IV (42 U.S.C.

651–669) is amended by adding after section

454A the following new section:

‘‘CENTRALIZED COLLECTION AND DISBURSEMENT

OF SUPPORT PAYMENTS

‘‘SEC. 454B. (a) IN GENERAL.—In order to

meet the requirement of section 454(27), the

State agency must operate a single centralized, automated unit for the collection and

disbursement of support payments, coordinated with the automated data system required under section 454A, in accordance

with the provisions of this section, which

shall be—

‘‘(1) operated directly by the State agency

(or by two or more State agencies under a regional cooperative agreement), or by a single

contractor responsible directly to the State

agency; and
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1995 T49.12

‘‘(2) used for the collection and disbursement (including interstate collection and

disbursement) of payments under support orders in all cases being enforced by the State

pursuant to section 454(4).

‘‘(b) REQUIRED PROCEDURES.—The centralized collections unit shall use automated

procedures, electronic processes, and computer-driven technology to the maximum extent feasible, efficient, and economical, for

the collection and disbursement of support

payments, including procedures—

‘‘(1) for receipt of payments from parents,

employers, and other States, and for disbursements to custodial parents and other

obligees, the State agency, and the State

agencies of other States;

‘‘(2) for accurate identification of payments;

‘‘(3) to ensure prompt disbursement of the

custodial parent’s share of any payment; and

‘‘(4) to furnish to either parent, upon request, timely information on the current

status of support payments.’’.

(c) USE OF AUTOMATED SYSTEM.—Section

454A, as added by section 415(a)(2) of this Act

and as amended by section 421 of this Act, is

amended by adding at the end the following

new subsection:

‘‘(g) CENTRALIZED COLLECTION AND DISTRIBUTION OF SUPPORT PAYMENTS.—The automated system required under this section

shall be used, to the maximum extent feasible, to assist and facilitate collections and

disbursement of support payments through

the centralized collections unit operated

pursuant to section 454B, through the performance of functions including at a

minimum—

‘‘(1) generation of orders and notices to

employers (and other debtors) for the withholding of wages (and other income)—

‘‘(A) within two working days after receipt

(from the directory of New Hires established

under section 453(i) or any other source) of

notice of and the income source subject to

such withholding; and

‘‘(B) using uniform formats directed by the

Secretary;

‘‘(2) ongoing monitoring to promptly identify failures to make timely payment; and

‘‘(3) automatic use of enforcement mechanisms (including mechanisms authorized

pursuant to section 466(c)) where payments

are not timely made.’’.

(d) EFFECTIVE DATE.—The amendments

made by this section shall become effective

on October 1, 1998.

SEC. 423. AMENDMENTS CONCERNING INCOME

WITHHOLDING.

(a) MANDATORY INCOME WITHHOLDING.—(1)

Section 466(a)(1) (42 U.S.C. 666(a)(1)) is

amended to read as follows:

‘‘(1) INCOME WITHHOLDING.—(A) UNDER ORDERS ENFORCED UNDER THE STATE PLAN.—Procedures described in subsection (b) for the

withholding from income of amounts payable as support in cases subject to enforcement under the State plan.

‘‘(B) UNDER CERTAIN ORDERS PREDATING

CHANGE IN REQUIREMENT.—Procedures under

which all child support orders issued (or

modified) before October 1, 1996, and which

are not otherwise subject to withholding

under subsection (b), shall become subject to

withholding from wages as provided in subsection (b) if arrearages occur, without the

need for a judicial or administrative hearing.’’.

(2) Section 466(a)(8) (42 U.S.C. 666(a)(8)) is

repealed.

(3) Section 466(b) (42 U.S.C. 666(b)) is

amended—

(A) in the matter preceding paragraph (1),

by striking ‘‘subsection (a)(1)’’ and inserting

‘‘subsection (a)(1)(A)’’;

(B) in paragraph (5), by striking all that

follows ‘‘administered by’’ and inserting

‘‘the State through the centralized collections unit established pursuant to section

454B, in accordance with the requirements of

such section 454B.’’;

(C) in paragraph (6)(A)(i)—

(i) by inserting ‘‘, in accordance with timetables established by the Secretary,’’ after

‘‘must be required’’; and

(ii) by striking ‘‘to the appropriate agency’’ and all that follows and inserting ‘‘to

the State centralized collections unit within

5 working days after the date such amount

would (but for this subsection) have been

paid or credited to the employee, for distribution in accordance with this part.’’;

(D) in paragraph (6)(A)(ii), by inserting ‘‘be

in a standard format prescribed by the Secretary, and’’ after ‘‘shall’’; and

(E) in paragraph (6)(D)—

(i) by striking ‘‘employer who discharges’’

and inserting ‘‘employer who—(A) discharges’’;

(ii) by relocating subparagraph (A), as designated, as an indented subparagraph after

and below the introductory matter;

(iii) by striking the period at the end; and

(iv) by adding after and below subparagraph (A) the following new subparagraph:

‘‘(B) fails to withhold support from wages,

or to pay such amounts to the State centralized collections unit in accordance with this

subsection.’’.

(b) CONFORMING AMENDMENT.—Section

466(c) (42 U.S.C. 666(c)) is repealed.

(c) DEFINITION OF TERMS.—The Secretary

shall promulgate regulations providing definitions, for purposes of part D of title IV of

the Social Security Act, for the term ‘‘income’’ and for such other terms relating to

income withholding under section 466(b) of

such Act as the Secretary may find it necessary or advisable to define.

SEC. 424. LOCATOR INFORMATION FROM INTERSTATE NETWORKS.

Section 466(a) (42 U.S.C. 666(a)), as amended

by section 423(a)(2) of this Act, is amended

by inserting after paragraph (7) the following:

‘‘(8) LOCATOR INFORMATION FROM INTERSTATE NETWORKS.—Procedures ensuring that

the State will neither provide funding for,

nor use for any purpose (including any purpose unrelated to the purposes of this part),

any automated interstate network or system

used to locate individuals—

‘‘(A) for purposes relating to the use of

motor vehicles; or

‘‘(B) providing information for law enforcement purposes (where child support enforcement agencies are otherwise allowed access

by State and Federal law),

unless all Federal and State agencies administering programs under this part (including

the entities established under section 453)

have access to information in such system or

network to the same extent as any other

user of such system or network.’’.

SEC. 425. EXPANDED FEDERAL PARENT LOCATOR

SERVICE.

(a) EXPANDED AUTHORITY TO LOCATE INDIVIDUALS AND ASSETS.—Section 453 (42 U.S.C.

653) is amended—

(1) in subsection (a), by striking all that

follows ‘‘subsection (c))’’ and inserting the

following:

‘‘, for the purpose of establishing parentage,

establishing, setting the amount of, modifying, or enforcing child support

obligations—

‘‘(1) information on, or facilitating the discovery of, the location of any individual—

‘‘(A) who is under an obligation to pay

child support;

‘‘(B) against whom such an obligation is

sought; or

‘‘(C) to whom such an obligation is owed,

including such individual’s social security

number (or numbers), most recent residential address, and the name, address, and employer identification number of such individual’s employer; and

‘‘(2) information on the individual’s wages

(or other income) from, and benefits of, employment (including rights to or enrollment

in group health care coverage); and

‘‘(3) information on the type, status, location, and amount of any assets of, or debts

owed by or to, any such individual.’’; and

(2) in subsection (b)—

(A) in the matter preceding paragraph (1),

by striking ‘‘social security’’ and all that

follows through ‘‘absent parent’’ and inserting ‘‘information specified in subsection

(a)’’; and

(B) in paragraph (2), by inserting before the

period ‘‘, or from any consumer reporting

agency (as defined in section 603(f) of the

Fair Credit Reporting Act (15 U.S.C.

1681a(f))’’;

(3) in subsection (e)(1), by inserting before

the period ‘‘, or by consumer reporting agencies’’.

(b) REIMBURSEMENT FOR DATA FROM FEDERAL AGENCIES.—Section 453(e)(2) (42 U.S.C.

653(e)(2)) is amended in the fourth sentence

by inserting before the period ‘‘in an amount

which the Secretary determines to be reasonable payment for the data exchange

(which amount shall not include payment for

the costs of obtaining, compiling, or maintaining the data)’’.

(c) ACCESS TO CONSUMER REPORTS UNDER

FAIR CREDIT REPORTING ACT.—(1) Section 608

of the Fair Credit Reporting Act (15 U.S.C.

1681f) is amended—

(A) by striking ‘‘, limited to’’ and inserting

‘‘to a governmental agency (including the

entire consumer report, in the case of a Federal, State, or local agency administering a

program under part D of title IV of the Social Security Act, and limited to’’; and

(B) by striking ‘‘employment, to a governmental agency’’ and inserting ‘‘employment,

in the case of any other governmental agency)’’.

(2) REIMBURSEMENT FOR REPORTS BY STATE

AGENCIES AND CREDIT BUREAUS.—Section 453

(42 U.S.C. 653) is amended by adding at the

end the following new subsection:

‘‘(g) The Secretary is authorized to reimburse costs to State agencies and consumer

credit reporting agencies the costs incurred

by such entities in furnishing information

requested by the Secretary pursuant to this

section in an amount which the Secretary

determines to be reasonable payment for the

data exchange (which amount shall not include payment for the costs of obtaining,

compiling, or maintaining the data).’’.

(d) DISCLOSURE OF TAX RETURN INFORMATION.—(1) Section 6103(1)(6)(A)(ii) of the Internal Revenue Code of 1986 is amended by

striking ‘‘, but only if’’ and all that follows

and inserting a period.

(2) Section 6103(1)(8)(A) of the Internal Revenue Code of 1986 is amended by inserting

‘‘Federal,’’ before ‘‘State or local’’.

(e) TECHNICAL AMENDMENTS.—

(1) Sections 452(a)(9), 453(a), 453(b), 463(a),

and 463(e) (42 U.S.C. 652(a)(9), 653(a), 653(b),

663(a), and 663(e)) are each amended by inserting ‘‘Federal’’ before ‘‘Parent’’ each

place it appears.

(2) Section 453 (42 U.S.C. 653) is amended in

the heading by adding ‘‘FEDERAL’’ before

‘‘PARENT’’.

(f) NEW COMPONENTS.—Section 453 (42

U.S.C. 653), as amended by subsection (c)(2)

of this section, is amended by adding at the

end the following:

‘‘(h) DATA BANK OF CHILD SUPPORT ORDERS.—

‘‘(1) IN GENERAL.—Not later than October 1,

1998, in order to assist States in administering their State plans under this part and

parts A, F, and G, and for the other purposes

specified in this section, the Secretary shall
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establish and maintain in the Federal Parent

Locator Service an automated registry to be

known as the Data Bank of Child Support

Orders, which shall contain abstracts of

child support orders and other information

described in paragraph (2) on each case in

each State central case registry maintained

pursuant to section 454A(e), as furnished

(and regularly updated), pursuant to section

454A(f), by State agencies administering programs under this part.

‘‘(2) CASE INFORMATION.—The information

referred to in paragraph (1), as specified by

the Secretary, shall include sufficient information (including names, social security

numbers or other uniform identification

numbers, and State case identification numbers) to identify the individuals who owe or

are owed support (or with respect to or on

behalf of whom support obligations are

sought to be established), and the State or

States which have established or modified,

or are enforcing or seeking to establish, such

an order.

‘‘(i) DIRECTORY OF NEW HIRES.—

‘‘(1) IN GENERAL.—Not later than October 1,

1998, In order to assist States in administering their State plans under this part and

parts A, F, and G, and for the other purposes

specified in this section, the Secretary shall

establish and maintain in the Federal Parent

Locator Service an automated directory to

be known as the directory of New Hires,

containing—

‘‘(A) information supplied by employers on

each newly hired individual, in accordance

with paragraph (2); and

‘‘(B) information supplied by State agencies administering State unemployment

compensation laws, in accordance with paragraph (3).

‘‘(2) EMPLOYER INFORMATION.—

‘‘(A) INFORMATION REQUIRED.—Subject to

subparagraph (D), each employer shall furnish to the Secretary, for inclusion in the directory established under this subsection,

not later than 10 days after the date (on or

after October 1, 1998) on which the employer

hires a new employee (as defined in subparagraph (C)), a report containing the name,

date of birth, and social security number of

such employee, and the employer identification number of the employer.

‘‘(B) REPORTING METHOD AND FORMAT.—The

Secretary shall provide for transmission of

the reports required under subparagraph (A)

using formats and methods which minimize

the burden on employers, which shall

include—

‘‘(i) automated or electronic transmission

of such reports;

‘‘(ii) transmission by regular mail; and

‘‘(iii) transmission of a copy of the form required for purposes of compliance with section 3402 of the Internal Revenue Code of

1986.

‘‘(C) EMPLOYEE DEFINED.—For purposes of

this paragraph, the term ‘employee’ means

any individual subject to the requirement of

section 3402(f)(2) of the Internal Revenue

Code of 1986.

‘‘(D) PAPERWORK REDUCTION REQUIREMENT.—As required by the information resources management policies published by

the Director of the Office of Management

and Budget pursuant to section 3504(b)(1) of

title 44, United States Code, the Secretary,

in order to minimize the cost and reporting

burden on employers, shall not require reporting pursuant to this paragraph if an alternative reporting mechanism can be developed that either relies on existing Federal or

State reporting or enables the Secretary to

collect the needed information in a more

cost-effective and equally expeditious manner, taking into account the reporting costs

on employers.

‘‘(E) CIVIL MONEY PENALTY ON NONCOMPLYING EMPLOYERS.—(i) Any employer that

fails to make a timely report in accordance

with this paragraph with respect to an individual shall be subject to a civil money penalty, for each calendar year in which the

failure occurs, of the lesser of $500 or 1 percent of the wages or other compensation paid

by such employer to such individual during

such calendar year.

‘‘(ii) Subject to clause (iii), the provisions

of section 1128A (other than subsections (a)

and (b) thereof) shall apply to a civil money

penalty under clause (i) in the same manner

as they apply to a civil money penalty or

proceeding under section 1128A(a).

‘‘(iii) Any employer with respect to whom

a penalty under this subparagraph is upheld

after an administrative hearing shall be liable to pay all costs of the Secretary with respect to such hearing.

‘‘(3) EMPLOYMENT SECURITY INFORMATION.—

‘‘(A) REPORTING REQUIREMENT.—Each State

agency administering a State unemployment

compensation law approved by the Secretary

of Labor under the Federal Unemployment

Tax Act shall furnish to the Secretary of

Health and Human Services extracts of the

reports to the Secretary of Labor concerning

the wages and unemployment compensation

paid to individuals required under section

303(a)(6), in accordance with subparagraph

(B).

‘‘(B) MANNER OF COMPLIANCE.—The extracts

required under subparagraph (A) shall be furnished to the Secretary of Health and

Human Services on a quarterly basis, with

respect to calendar quarters beginning on

and after October 1, 1996, by such dates, in

such format, and containing such information as required by that Secretary in regulations.

‘‘(j) DATA MATCHES AND OTHER DISCLOSURES.—

‘‘(1) VERIFICATION BY SOCIAL SECURITY ADMINISTRATION.—(A) The Secretary shall

transmit data on individuals and employers

maintained under this section to the Social

Security Administration to the extent necessary for verification in accordance with

subparagraph (B).

‘‘(B) The Social Security Administration

shall verify the accuracy of, correct or supply to the extent necessary and feasible, and

report to the Secretary, the following information in data supplied by the Secretary

pursuant to subparagraph (A):

‘‘(i) the name, social security number, and

birth date of each individual; and

‘‘(ii) the employer identification number of

each employer.

‘‘(2) CHILD SUPPORT LOCATOR MATCHES.—For

the purpose of locating individuals for purposes of paternity establishment and establishment and enforcement of child support,

the Secretary shall—

‘‘(A) match data in the directory of New

Hires against the child support order abstracts in the Data Bank of Child Support

Orders not less often than every 2 working

days; and

‘‘(B) report information obtained from

such a match to concerned State agencies

operating programs under this part not later

than 2 working days after such match.

‘‘(3) DATA MATCHES AND DISCLOSURES OF

DATA IN ALL REGISTRIES FOR TITLE IV PROGRAM PURPOSES.—The Secretary shall—

‘‘(A) perform matches of data in each component of the Federal Parent Locator Service maintained under this section against

data in each other such component (other

than the matches required pursuant to paragraph (1)), and report information resulting

from such matches to State agencies operating programs under this part and parts A,

F, and G; and

‘‘(B) disclose data in such registries to

such State agencies,

to the extent, and with the frequency, that

the Secretary determines to be effective in

assisting such States to carry out their responsibilities under such programs.

‘‘(k) FEES.—

‘‘(1) FOR SSA VERIFICATION.—The Secretary

shall reimburse the Commissioner of Social

Security, at a rate negotiated between the

Secretary and the Commissioner, the costs

incurred by the Commissioner in performing

the verification services specified in subsection (j).

‘‘(2) FOR INFORMATION FROM SESAS.—The

Secretary shall reimburse costs incurred by

State employment security agencies in furnishing data as required by subsection (j)(3),

at rates which the Secretary determines to

be reasonable (which rates shall not include

payment for the costs of obtaining, compiling, or maintaining such data).

‘‘(3) FOR INFORMATION FURNISHED TO STATE

AND FEDERAL AGENCIES.—State and Federal

agencies receiving data or information from

the Secretary pursuant to this section shall

reimburse the costs incurred by the Secretary in furnishing such data or information, at rates which the Secretary determines to be reasonable (which rates shall include payment for the costs of obtaining,

verifying, maintaining, and matching such

data or information).

‘‘(l) RESTRICTION ON DISCLOSURE AND USE.—

Data in the Federal Parent Locator Service,

and information resulting from matches

using such data, shall not be used or disclosed except as specifically provided in this

section.

‘‘(m) RETENTION OF DATA.—Data in the

Federal Parent Locator Service, and data resulting from matches performed pursuant to

this section, shall be retained for such period

(determined by the Secretary) as appropriate

for the data uses specified in this section.

‘‘(n) INFORMATION INTEGRITY AND SECURITY.—The Secretary shall establish and implement safeguards with respect to the entities established under this section designed

to—

‘‘(1) ensure the accuracy and completeness

of information in the Federal Parent Locator

Service; and

‘‘(2) restrict access to confidential information in the Federal Parent Locator Service to authorized persons, and restrict use of

such information to authorized purposes.

‘‘(o) LIMIT ON LIABILITY.—The Secretary

shall not be liable to either a State or an individual for inaccurate information provided

to a component of the Federal Parent Locator Service section and disclosed by the Secretary in accordance with this section.’’.

(g) CONFORMING AMENDMENTS.—

(1) TO PART D OF TITLE IV OF THE SOCIAL SECURITY ACT.—Section 454(8)(B) (42 U.S.C.

654(8)(B)) is amended to read as follows:

‘‘(B) the Federal Parent Locator Service

established under section 453;’’.

(2) TO FEDERAL UNEMPLOYMENT TAX ACT.—

Section 3304(16) of the Internal Revenue Code

of 1986 is amended—

(A) by striking ‘‘Secretary of Health, Education, and Welfare’’ each place such term

appears and inserting ‘‘Secretary of Health

and Human Services’’;

(B) in subparagraph (B), by striking ‘‘such

information’’ and all that follows and inserting ‘‘information furnished under subparagraph (A) or (B) is used only for the purposes

authorized under such subparagraph;’’;

(C) by striking ‘‘and’’ at the end of subparagraph (A);

(D) by redesignating subparagraph (B) as

subparagraph (C); and

(E) by inserting after subparagraph (A) the

following new subparagraph:

‘‘(B) wage and unemployment compensation information contained in the records of

such agency shall be furnished to the Secretary of Health and Human Services (in accordance with regulations promulgated by

such Secretary) as necessary for the pur-
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1995 T49.12

poses of the directory of New Hires established under section 453(i) of the Social Security Act, and’’.

(3) TO STATE GRANT PROGRAM UNDER TITLE

III OF THE SOCIAL SECURITY ACT.—Section

303(a) (42 U.S.C. 503(a)) is amended—

(A) by striking ‘‘and’’ at the end of paragraph (8);

(B) by striking the period at the end of

paragraph (9) and inserting ‘‘; and’’; and

(C) by adding after paragraph (9) the following new paragraph:

‘‘(10) The making of quarterly electronic

reports, at such dates, in such format, and

containing such information, as required by

the Secretary of Health and Human Services

under section 453(i)(3), and compliance with

such provisions as such Secretary may find

necessary to ensure the correctness and

verification of such reports.’’.

SEC. 426. USE OF SOCIAL SECURITY NUMBERS.

(a) STATE LAW REQUIREMENT.—Section

466(a) (42 U.S.C. 666(a)), as amended by section 401(a) of this Act, is amended by inserting after paragraph (12) the following:

‘‘(13) SOCIAL SECURITY NUMBERS REQUIRED.—

Procedures requiring the recording of social

security numbers—

‘‘(A) of both parties on marriage licenses

and divorce decrees; and

‘‘(B) of both parents, on birth records and

child support and paternity orders.’’.

(b) CLARIFICATION OF FEDERAL POLICY.—

Section 205(c)(2)(C)(ii) (42 U.S.C.

405(c)(2)(C)(ii)) is amended by striking the

third sentence and inserting ‘‘This clause

shall not be considered to authorize disclosure of such numbers except as provided in

the preceding sentence.’’.

Subtitle D—Streamlining and Uniformity of

Procedures

SEC. 431. ADOPTION OF UNIFORM STATE LAWS.

Section 466(a) (42 U.S.C. 666(a)), as amended

by sections 401(a) and 426(a) of this Act, is

amended inserting after paragraph (13) the

following:

‘‘(14) INTERSTATE ENFORCEMENT.—(A) ADOPTION OF UIFSA.—Procedures under which the

State adopts in its entirety (with the modifications and additions specified in this paragraph) not later than January 1, 1997, and

uses on and after such date, the Uniform

Interstate Family Support Act, as approved

by the National Conference of Commissioners on Uniform State Laws in August,

1992.

‘‘(B) EXPANDED APPLICATION OF UIFSA.—The

State law adopted pursuant to subparagraph

(A) shall be applied to any case—

‘‘(i) involving an order established or modified in one State and for which a subsequent

modification is sought in another State; or

‘‘(ii) in which interstate activity is required to enforce an order.

‘‘(C) JURISDICTION TO MODIFY ORDERS.—The

State law adopted pursuant to subparagraph

(A) of this paragraph shall contain the following provision in lieu of section 611(a)(1) of

the Uniform Interstate Family Support Act

described in such subparagraph (A):

‘‘‘(1) the following requirements are met:

‘‘‘(i) the child, the individual obligee, and

the obligor—

‘‘‘(I) do not reside in the issuing State; and

‘‘‘(II) either reside in this State or are subject to the jurisdiction of this State pursuant to section 201; and

‘‘‘(ii) (in any case where another State is

exercising or seeks to exercise jurisdiction

to modify the order) the conditions of section 204 are met to the same extent as required for proceedings to establish orders;

or’.

‘‘(D) SERVICE OF PROCESS.—The State law

adopted pursuant to subparagraph (A) shall

recognize as valid, for purposes of any proceeding subject to such State law, service of

process upon persons in the State (and proof

of such service) by any means acceptable in

another State which is the initiating or responding State in such proceeding.

‘‘(E) COOPERATION BY EMPLOYERS.—The

State law adopted pursuant to subparagraph

(A) shall provide for the use of procedures

(including sanctions for noncompliance)

under which all entities in the State (including for-profit, nonprofit, and governmental

employers) are required to provide promptly,

in response to a request by the State agency

of that or any other State administering a

program under this part, information on the

employment, compensation, and benefits of

any individual employed by such entity as

an employee or contractor.’’.

SEC. 432. IMPROVEMENTS TO FULL FAITH AND

CREDIT FOR CHILD SUPPORT ORDERS.

Section 1738B of title 28, United States

Code, is amended—

(1) in subsection (a)(2), by striking ‘‘subsection (e)’’ and inserting ‘‘subsections (e),

(f), and (i)’’;

(2) in subsection (b), by inserting after the

2nd undesignated paragraph the following:

‘‘‘child’s home State’ means the State in

which a child lived with a parent or a person

acting as parent for at least six consecutive

months immediately preceding the time of

filing of a petition or comparable pleading

for support and, if a child is less than six

months old, the State in which the child

lived from birth with any of them. A period

of temporary absence of any of them is

counted as part of the six-month period.’’;

(3) in subsection (c), by inserting ‘‘by a

court of a State’’ before ‘‘is made’’;

(4) in subsection (c)(1), by inserting ‘‘and

subsections (e), (f), and (g)’’ after ‘‘located’’;

(5) in subsection (d)—

(A) by inserting ‘‘individual’’ before ‘‘contestant’’; and

(B) by striking ‘‘subsection (e)’’ and inserting ‘‘subsections (e) and (f)’’;

(6) in subsection (e), by striking ‘‘make a

modification of a child support order with respect to a child that is made’’ and inserting

‘‘modify a child support order issued’’;

(7) in subsection (e)(1), by inserting ‘‘pursuant to subsection (i)’’ before the semicolon;

(8) in subsection (e)(2)—

(A) by inserting ‘‘individual’’ before ‘‘contestant’’ each place such term appears; and

(B) by striking ‘‘to that court’s making the

modification and assuming’’ and inserting

‘‘with the State of continuing, exclusive jurisdiction for a court of another State to

modify the order and assume’’;

(9) by redesignating subsections (f) and (g)

as subsections (g) and (h), respectively;

(10) by inserting after subsection (e) the

following:

‘‘(f) RECOGNITION OF CHILD SUPPORT ORDERS.—If one or more child support orders

have been issued in this or another State

with regard to an obligor and a child, a court

shall apply the following rules in determining which order to recognize for purposes

of continuing, exclusive jurisdiction and enforcement:

‘‘(1) If only one court has issued a child

support order, the order of that court must

be recognized.

‘‘(2) If two or more courts have issued child

support orders for the same obligor and

child, and only one of the courts would have

continuing, exclusive jurisdiction under this

section, the order of that court must be recognized.

‘‘(3) If two or more courts have issued child

support orders for the same obligor and

child, and only one of the courts would have

continuing, exclusive jurisdiction under this

section, an order issued by a court in the

current home State of the child must be recognized, but if an order has not been issued

in the current home State of the child, the

order most recently issued must be recognized.

‘‘(4) If two or more courts have issued child

support orders for the same obligor and

child, and none of the courts would have continuing, exclusive jurisdiction under this

section, a court may issue a child support

order, which must be recognized.

‘‘(5) The court that has issued an order recognized under this subsection is the court

having continuing, exclusive jurisdiction.’’;

(11) in subsection (g) (as so redesignated)—

(A) by striking ‘‘PRIOR’’ and inserting

‘‘MODIFIED’’; and

(B) by striking ‘‘subsection (e)’’ and inserting ‘‘subsections (e) and (f)’’;

(12) in subsection (h) (as so redesignated)—

(A) in paragraph (2), by inserting ‘‘including the duration of current payments and

other obligations of support’’ before the

comma; and

(B) in paragraph (3), by inserting ‘‘arrears

under’’ after ‘‘enforce’’; and

(13) by adding at the end the following:

‘‘(i) REGISTRATION FOR MODIFICATION.—If

there is no individual contestant or child residing in the issuing State, the party or support enforcement agency seeking to modify,

or to modify and enforce, a child support

order issued in another State shall register

that order in a State with jurisdiction over

the nonmovant for the purpose of modification.’’.

SEC. 433. STATE LAWS PROVIDING EXPEDITED

PROCEDURES.

(a) STATE LAW REQUIREMENTS.—Section 466

(42 U.S.C. 666) is amended—

(1) in subsection (a)(2), in the first sentence, to read as follows: ‘‘Expedited administrative and judicial procedures (including

the procedures specified in subsection (c)) for

establishing paternity and for establishing,

modifying, and enforcing support obligations.’’; and

(2) by adding after subsection (b) the following new subsection:

‘‘(c) EXPEDITED PROCEDURES.—The procedures specified in this subsection are the following:

‘‘(1) ADMINISTRATIVE ACTION BY STATE

AGENCY.—Procedures which give the State

agency the authority (and recognize and enforce the authority of State agencies of

other States), without the necessity of obtaining an order from any other judicial or

administrative tribunal (but subject to due

process safeguards, including (as appropriate) requirements for notice, opportunity

to contest the action, and opportunity for an

appeal on the record to an independent administrative or judicial tribunal), to take

the following actions relating to establishment or enforcement of orders:

‘‘(A) GENETIC TESTING.—To order genetic

testing for the purpose of paternity establishment as provided in section 466(a)(5).

‘‘(B) DEFAULT ORDERS.—To enter a default

order, upon a showing of service of process

and any additional showing required by

State law—

‘‘(i) establishing paternity, in the case of

any putative father who refuses to submit to

genetic testing; and

‘‘(ii) establishing or modifying a support

obligation, in the case of a parent (or other

obligor or obligee) who fails to respond to

notice to appear at a proceeding for such

purpose.

‘‘(C) SUBPOENAS.—To subpoena any financial or other information needed to establish, modify, or enforce an order, and to

sanction failure to respond to any such subpoena.

‘‘(D) ACCESS TO PERSONAL AND FINANCIAL

INFORMATION.—To obtain access, subject to

safeguards on privacy and information security, to the following records (including

automated access, in the case of records

maintained in automated data bases):
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‘‘(i) records of other State and local government agencies, including—

‘‘(I) vital statistics (including records of

marriage, birth, and divorce);

‘‘(II) State and local tax and revenue

records (including information on residence

address, employer, income and assets);

‘‘(III) records concerning real and titled

personal property;

‘‘(IV) records of occupational and professional licenses, and records concerning the

ownership and control of corporations, partnerships, and other business entities;

‘‘(V) employment security records;

‘‘(VI) records of agencies administering

public assistance programs;

‘‘(VII) records of the motor vehicle department; and

‘‘(VIII) corrections records; and

‘‘(ii) certain records held by private entities, including—

‘‘(I) customer records of public utilities

and cable television companies; and

‘‘(II) information (including information

on assets and liabilities) on individuals who

owe or are owed support (or against or with

respect to whom a support obligation is

sought) held by financial institutions (subject to limitations on liability of such entities arising from affording such access).

‘‘(E) INCOME WITHHOLDING.—To order income withholding in accordance with subsection (a)(1) and (b) of section 466.

‘‘(F) CHANGE IN PAYEE.—(In cases where

support is subject to an assignment under

section 402(a)(26), 471(a)(17), or 1912, or to a

requirement to pay through the centralized

collections unit under section 454B) upon

providing notice to obligor and obligee, to

direct the obligor or other payor to change

the payee to the appropriate government entity.

‘‘(G) SECURE ASSETS TO SATISFY ARREARAGES.—For the purpose of securing overdue

support—

‘‘(i) to intercept and seize any periodic or

lump-sum payment to the obligor by or

through a State or local government agency,

including—

‘‘(I) unemployment compensation, workers’ compensation, and other benefits;

‘‘(II) judgments and settlements in cases

under the jurisdiction of the State or local

government; and

‘‘(III) lottery winnings;

‘‘(ii) to attach and seize assets of the obligor held by financial institutions;

‘‘(iii) to attach public and private retirement funds in appropriate cases, as determined by the Secretary; and

‘‘(iv) to impose liens in accordance with

paragraph (a)(4) and, in appropriate cases, to

force sale of property and distribution of proceeds.

‘‘(H) INCREASE MONTHLY PAYMENTS.—For

the purpose of securing overdue support, to

increase the amount of monthly support payments to include amounts for arrearages

(subject to such conditions or restrictions as

the State may provide).

‘‘(I) SUSPENSION OF DRIVERS’ LICENSES.—To

suspend drivers’ licenses of individuals owing

past-due support, in accordance with subsection (a)(16).

‘‘(2) SUBSTANTIVE AND PROCEDURAL

RULES.—The expedited procedures required

under subsection (a)(2) shall include the following rules and authority, applicable with

respect to all proceedings to establish paternity or to establish, modify, or enforce support orders:

‘‘(A) LOCATOR INFORMATION; PRESUMPTIONS

CONCERNING NOTICE.—Procedures under

which—

‘‘(i) the parties to any paternity or child

support proceedings are required (subject to

privacy safeguards) to file with the tribunal

before entry of an order, and to update as appropriate, information on location and identity (including Social Security number, residential and mailing addresses, telephone

number, driver’s license number, and name,

address, and telephone number of employer);

and

‘‘(ii) in any subsequent child support enforcement action between the same parties,

the tribunal shall be authorized, upon sufficient showing that diligent effort has been

made to ascertain such party’s current location, to deem due process requirements for

notice and service of process to be met, with

respect to such party, by delivery to the

most recent residential or employer address

so filed pursuant to clause (i).

‘‘(B) STATEWIDE JURISDICTION.—Procedures

under which—

‘‘(i) the State agency and any administrative or judicial tribunal with authority to

hear child support and paternity cases exerts

statewide jurisdiction over the parties, and

orders issued in such cases have statewide effect; and

‘‘(ii) (in the case of a State in which orders

in such cases are issued by local jurisdictions) a case may be transferred between jurisdictions in the State without need for any

additional filing by the petitioner, or service

of process upon the respondent, to retain jurisdiction over the parties.’’.

(c) EXCEPTIONS FROM STATE LAW REQUIREMENTS.—Section 466(d) (42 U.S.C. 666(d)) is

amended—

(1) by striking ‘‘(d) If’’ and inserting the

following:

‘‘(d) EXEMPTIONS FROM REQUIREMENTS.—

‘‘(1) IN GENERAL.—Subject to paragraph (2),

if’’; and

(2) by adding at the end the following new

paragraph:

‘‘(2) NONEXEMPT REQUIREMENTS.—The Secretary shall not grant an exemption from the

requirements of—

‘‘(A) subsection (a)(5) (concerning procedures for paternity establishment);

‘‘(B) subsection (a)(10) (concerning modification of orders);

‘‘(C) subsection (a)(12) (concerning recording of orders in the central State case registry);

‘‘(D) subsection (a)(13) (concerning recording of Social Security numbers);

‘‘(E) subsection (a)(14) (concerning interstate enforcement); or

‘‘(F) subsection (c) (concerning expedited

procedures), other than paragraph (1)(A)

thereof (concerning establishment or modification of support amount).’’.

(d) AUTOMATION OF STATE AGENCY FUNCTIONS.—Section 454A, as added by section

415(a)(2) of this Act and as amended by sections 421 and 422(c) of this Act, is amended

by adding at the end the following new subsection:

‘‘(h) EXPEDITED ADMINISTRATIVE PROCEDURES.—The automated system required

under this section shall be used, to the maximum extent feasible, to implement any expedited administrative procedures required

under section 466(c).’’.

Subtitle E—Paternity Establishment

SEC. 441. SENSE OF THE CONGRESS.

It is the sense of the Congress that social

services should be provided in hospitals to

women who have become pregnant as a result of rape or incest.

SEC. 442. AVAILABILITY OF PARENTING SOCIAL

SERVICES FOR NEW FATHERS.

Section 466(a) (42 U.S.C. 666(a)), as amended

by sections 401(a), 426(a), and 431 of this Act,

is amended by inserting after paragraph (14)

the following:

‘‘(15) Procedures for providing new fathers

with positive parenting counseling that

stresses the importance of paying child support in a timely manner, in accordance with

regulations prescribed by the Secretary.’’.

SEC. 443. COOPERATION REQUIREMENT AND

GOOD CAUSE EXCEPTION.

(a) CHILD SUPPORT ENFORCEMENT REQUIREMENTS.—Section 454 (42 U.S.C. 654) is

amended—

(1) by striking ‘‘and’’ at the end of paragraph (23);

(2) by striking the period at the end of

paragraph (24) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (24) the following:

‘‘(25) provide that the State agency administering the plan under this part—

‘‘(A) will make the determination specified

under paragraph (4), as to whether an individual is cooperating with efforts to establish paternity and secure support (or has

good cause not to cooperate with such efforts) for purposes of the requirements of

sections 402(a)(26) and 1912;

‘‘(B) will advise individuals, both orally

and in writing, of the grounds for good cause

exceptions to the requirement to cooperate

with such efforts;

‘‘(C) will take the best interests of the

child into consideration in making the determination whether such individual has good

cause not to cooperate with such efforts;

‘‘(D)(i) will make the initial determination

as to whether an individual is cooperating

(or has good cause not to cooperate) with efforts to establish paternity within 10 days

after such individual is referred to such

State agency by the State agency administering the program under part A of title

XIX;

‘‘(ii) will make redeterminations as to cooperation or good cause at appropriate intervals; and

‘‘(iii) will promptly notify the individual,

and the State agencies administering such

programs, of each such determination and

redetermination;

‘‘(E) with respect to any child born on or

after the date 10 months after enactment of

this provision, will not determine (or redetermine) the mother (or other custodial relative) of such child to be cooperating with

efforts to establish paternity unless such individual furnishes—

‘‘(i) the name of the putative father (or fathers); and

‘‘(ii) sufficient additional information to

enable the State agency, if reasonable efforts

were made, to verify the identity of the person named as the putative father (including

such information as the putative father’s

present address, telephone number, date of

birth, past or present place of employment,

school previously or currently attended, and

names and addresses of parents, friends, or

relatives able to provide location information, or other information that could enable

service of process on such person), and

‘‘(F)(i) (where a custodial parent who was

initially determined not to be cooperating

(or to have good cause not to cooperate) is

later determined to be cooperating or to

have good cause not to cooperate) will immediately notify the State agencies administering the programs under part A of title

XIX that this eligibility condition has been

met; and

‘‘(ii) (where a custodial parent was initially determined to be cooperating (or to

have good cause not to cooperate)) will not

later determine such individual not to be cooperating (or not to have good cause not to

cooperate) until such individual has been afforded an opportunity for a hearing.’’.

(b) AFDC AMENDMENTS.—

(1) Section 402(a)(11) (42 U.S.C. 602(a)(11)) is

amended by striking ‘‘furnishing of’’ and inserting ‘‘application for’’.

(2) Section 402(a)(26) (42 U.S.C. 602(a)(26)) is

amended—

(A) in each of subparagraphs (A) and (B),

by redesignating clauses (i) and (ii) as subclauses (I) and (II);
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1995 T49.12

(B) by indenting and redesignating subparagraphs (A), (B), and (C) as clauses (i),

(ii), and (iv), respectively;

(C) in clause (ii), as redesignated—

(i) by striking ‘‘is claimed, or in obtaining

any other payments or property due such applicant or such child,’’ and inserting ‘‘is

claimed;’’; and

(ii) by striking ‘‘unless’’ and all that follows through ‘‘aid is claimed; and’’;

(D) by adding after clause (ii) the following

new clause:

‘‘(iii) to cooperate with the State in obtaining any other payments or property due

such applicant or such child; and’’;

(E) in the matter preceding clause (i) (as so

redesignated) to read as follows:

‘‘(26) provide—

‘‘(A) that, as a condition of eligibility for

aid, each applicant or recipient will be required (subject to subparagraph (C))—’’;

(F) in subparagraph (A)(iv), as redesignated, by striking ‘‘, unless such individual’’

and all that follows through ‘‘individuals involved’’;

(G) by adding at the end the following new

subparagraphs:

‘‘(B) that the State agency will immediately refer each applicant requiring paternity establishment services to the State

agency administering the program under

part D;

‘‘(C) that an individual will not be required

to cooperate with the State, as provided

under subparagraph (A), if the individual is

found to have good cause for refusing to cooperate, as determined in accordance with

standards prescribed by the Secretary, which

standards shall take into consideration the

best interests of the child on whose behalf

aid is claimed—

‘‘(i) to the satisfaction of the State agency

administering the program under part D, as

determined in accordance with section

454(25), with respect to the requirements

under clauses (i) and (ii) of subparagraph (A);

and

‘‘(ii) to the satisfaction of the State agency

administering the program under this part,

with respect to the requirements under

clauses (iii) and (iv) of subparagraph (A);

‘‘(D) that (except as provided in subparagraph (E)) an applicant requiring paternity

establishment services (other than an individual eligible for emergency assistance as

defined in section 406(e)) shall not be eligible

for any aid under a State plan approved

under this part until such applicant—

‘‘(i) has furnished to the agency administering the State plan under part D the information specified in section 454(25)(E); or

‘‘(ii) has been determined by such agency

to have good cause not to cooperate;

‘‘(E) that the provisions of subparagraph

(D) shall not apply—

‘‘(i) if the State agency specified in such

subparagraph has not, within 10 days after

such individual was referred to such agency,

provided the notification required by section

454(25)(D)(iii), until such notification is received; and

‘‘(ii) if such individual appeals a determination that the individual lacks good

cause for noncooperation, until after such

determination is affirmed after notice and

opportunity for a hearing; and’’; and

(H)(i) by relocating and redesignating as

subparagraph (F) the text at the end of subparagraph (A)(ii) beginning with ‘‘that, if the

relative’’ and all that follows through the

semicolon;

(ii) in subparagraph (F), as so redesignated

and relocated, by striking ‘‘subparagraphs

(A) and (B) of this paragraph’’ and inserting

‘‘subparagraph (A)’’; and

(iii) by striking ‘‘and’’ at the end of subparagraph (a)(ii).

(c) MEDICAID AMENDMENTS.—Section 1912(a)

(42 U.S.C. 1396k(a)) is amended—

(1) in paragraph (1)(B), by inserting ‘‘(except as provided in paragraph (2))’’ after ‘‘to

cooperate with the State’’;

(2) in subparagraphs (B) and (C) of paragraph (1) by striking ‘‘, unless’’ and all that

follows and inserting a semicolon; and

(3) by redesignating paragraph (2) as paragraph (5), and inserting after paragraph (1)

the following new paragraphs:

‘‘(2) provide that the State agency will immediately refer each applicant or recipient

requiring paternity establishment services

to the State agency administering the program under part D of title IV;

‘‘(3) provide that an individual will not be

required to cooperate with the State, as provided under paragraph (1), if the individual is

found to have good cause for refusing to cooperate, as determined in accordance with

standards prescribed by the Secretary, which

standards shall take into consideration the

best interests of the individuals involved—

‘‘(A) to the satisfaction of the State agency administering the program under part D,

as determined in accordance with section

454(25), with respect to the requirements to

cooperate with efforts to establish paternity

and to obtain support (including medical

support) from a parent; and

‘‘(B) to the satisfaction of the State agency

administering the program under this title,

with respect to other requirements to cooperate under paragraph (1);

‘‘(4) provide that (except as provided in

paragraph (5)) an applicant requiring paternity establishment services (other than an

individual eligible for emergency assistance

as defined in section 406(e), or presumptively

eligible pursuant to section 1920) shall not be

eligible for medical assistance under this

title until such applicant—

‘‘(i) has furnished to the agency administering the State plan under part D of title

IV the information specified in section

454(25)(E); or

‘‘(ii) has been determined by such agency

to have good cause not to cooperate; and

‘‘(5) provide that the provisions of paragraph (4) shall not apply with respect to an

applicant—

‘‘(i) if such agency has not, within 10 days

after such individual was referred to such

agency, provided the notification required by

section 454(25)(D)(iii), until such notification

is received); and

‘‘(ii) if such individual appeals a determination that the individual lacks good

cause for noncooperation, until after such

determination is affirmed after notice and

opportunity for a hearing.’’.

(d) EFFECTIVE DATE.—The amendments

made by this section shall be effective with

respect to applications filed in or after the

first calendar quarter beginning 10 months

or more after the date of the enactment of

this Act (or such earlier quarter as the State

may select) for aid under a State plan approved under part A of title IV or for medical

assistance under a State plan approved under

title XIX.

SEC. 444. FEDERAL MATCHING PAYMENTS.

(a) INCREASED BASE MATCHING RATE.—Section 455(a)(2) (42 U.S.C. 655(a)(2)) is amended

to read as follows:

‘‘(2) The applicable percent for a quarter

for purposes of paragraph (1)(A) is—

‘‘(A) for fiscal year 1996, 69 percent;

‘‘(B) for fiscal year 1997, 72 percent; and

‘‘(C) for fiscal year 1998 and succeeding fiscal years, 75 percent.’’.

(b) MAINTENANCE OF EFFORT.—Section 455

(42 U.S.C. 655) is amended—

(1) in subsection (a)(1), in the matter preceding subparagraph (A), by striking ‘‘From’’

and inserting ‘‘Subject to subsection (c),

from’’; and

(2) by inserting after subsection (b) the following:

‘‘(c) MAINTENANCE OF EFFORT.—Notwithstanding subsection (a), total expenditures

for the State program under this part for fiscal year 1996 and each succeeding fiscal year,

reduced by the percentage specified for such

fiscal year under subparagraph (A), (B), or

(C)(i) of paragraph (2), shall not be less than

such total expenditures for fiscal year 1995,

reduced by 66 percent.’’.

SEC. 445. PERFORMANCE-BASED INCENTIVES

AND PENALTIES.

(a) INCENTIVE ADJUSTMENTS TO FEDERAL

MATCHING RATE.—Section 458 (42 U.S.C. 658)

is amended to read as follows:

‘‘INCENTIVE ADJUSTMENTS TO MATCHING RATE

‘‘SEC. 458. (a) INCENTIVE ADJUSTMENT.—

‘‘(1) IN GENERAL.—In order to encourage

and reward State child support enforcement

programs which perform in an effective manner, the Federal matching rate for payments

to a State under section 455(a)(1)(A), for each

fiscal year beginning on or after October 1,

1997, shall be increased by a factor reflecting

the sum of the applicable incentive adjustments (if any) determined in accordance

with regulations under this section with respect to Statewide paternity establishment

and the overall performance of the State in

child support enforcement.

‘‘(2) STANDARDS.—

‘‘(A) IN GENERAL.—The Secretary shall

specify in regulations—

‘‘(i) the levels of accomplishment, and

rates of improvement as alternatives to such

levels, which States must attain to qualify

for incentive adjustments under this section;

and

‘‘(ii) the amounts of incentive adjustment

that shall be awarded to States achieving

specified accomplishment or improvement

levels, which amounts shall be graduated,

ranging up to—

‘‘(I) 5 percentage points, in connection

with Statewide paternity establishment; and

‘‘(II) 10 percentage points, in connection

with overall performance in child support

enforcement.

‘‘(B) LIMITATION.—In setting performance

standards pursuant to subparagraph (A)(i)

and adjustment amounts pursuant to subparagraph (A)(ii), the Secretary shall ensure

that the aggregate number of percentage

point increases as incentive adjustments to

all States do not exceed such aggregate increases as assumed by the Secretary in estimates of the cost of this section as of June

1994, unless the aggregate performance of all

States exceeds the projected aggregate performance of all States in such cost estimates.

‘‘(3) DETERMINATION OF INCENTIVE ADJUSTMENT.—

‘‘(A) USE OF PERFORMANCE INDICATORS.—

The Secretary shall, for fiscal year 1998 and

each succeeding fiscal year, determine the

amount (if any) of incentive adjustment for

each State on the basis of the data submitted by the State pursuant to section

454(15)(B) with respect to performance indicators established by the Secretary.

‘‘(B) MINIMUM PERFORMANCE REQUIRED.—

‘‘(i) IN GENERAL.—The Secretary shall not

determine an incentive adjustment for a

State for a fiscal year if the level of performance of the State for the fiscal year with respect to such performance indicators is

below the performance threshold established

by the Secretary for the State for the fiscal

year.

‘‘(ii) ESTABLISHMENT OF STATE PERFORMANCE THRESHOLD.—The performance threshold with respect to such performance indicators for a State and a fiscal year shall be at

or above the greater of—

‘‘(I) the national average level of performance with respect to such indicators, as of

the date of the enactment of this section; or
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‘‘(II) the level of performance of the State

with respect to such indicators for the immediately preceding fiscal year.

‘‘(C) DEADLINE FOR ISSUANCE OF REGULATIONS.—Within 90 days after the date of the

enactment of this section, the Secretary

shall issue regulations setting forth the criteria for awarding incentive adjustments.

‘‘(4) FISCAL YEAR SUBJECT TO INCENTIVE ADJUSTMENT.—The total percentage point increase determined pursuant to this section

with respect to a State program in a fiscal

year shall apply as an adjustment to the percent applicable under section 455(a)(2) for

payments to such State for the succeeding

fiscal year.

‘‘(b) DEFINITIONS.—As used in subsection

(a):

‘‘(1) STATEWIDE PATERNITY ESTABLISHMENT

PERCENTAGE.—The term ‘Statewide paternity

establishment percentage’ means, with respect to a fiscal year, the ratio (expressed as

a percentage) of—

‘‘(A) the total number of out-of-wedlock

children in the State under one year of age

for whom paternity is established or acknowledged during the fiscal year, to

‘‘(B) the total number of children born out

of wedlock in the State during such fiscal

year.

‘‘(2) OVERALL PERFORMANCE OF THE STATE

IN CHILD SUPPORT ENFORCEMENT.—The term

‘overall performance of the State in child

support enforcement’ means a measure or

measures of the effectiveness of the State

agency in a fiscal year which takes into account factors including—

‘‘(A) the percentage of cases requiring a

child support order in which such an order

was established;

‘‘(B) the percentage of cases in which child

support is being paid;

‘‘(C) the ratio of child support collected to

child support due; and

‘‘(D) the cost-effectiveness of the State

program, as determined in accordance with

standards established by the Secretary in

regulations.’’.

(b) TITLE IV–D PAYMENT ADJUSTMENT.—

Section 455(a)(2) (42 U.S.C. 655(a)(2)), as

amended by section 415(a) of this Act, is

amended—

(1) by striking the period at the end of subparagraph (C) and inserting a semicolon; and

(2) by adding after and below subparagraph

(C), flush with the left margin of the subsection, the following:

‘‘increased by the incentive adjustment factor (if any) determined by the Secretary pursuant to section 458.’’.

(c) CONFORMING AMENDMENTS.—Section

454(22) (42 U.S.C. 654(22)) is amended—

(1) by striking ‘‘incentive payments’’ the

1st place such term appears and inserting

‘‘incentive adjustments’’; and

(2) by striking ‘‘any such incentive payments made to the State for such period’’

and inserting ‘‘any increases in Federal payments to the State resulting from such incentive adjustments’’.

(d) CALCULATION OF IV–D PATERNITY ESTABLISHMENT PERCENTAGE.—

(1) Section 452(g)(1) (42 U.S.C. 652(g)(1)) is

amended in the matter preceding subparagraph (A) by inserting ‘‘its overall performance in child support enforcement is satisfactory (as defined in section 458(b) and regulations of the Secretary), and’’ after ‘‘1994,’’.

(2) Section 452(g)(2)(A) (42 U.S.C.

652(g)(2)(A)) is amended in the matter preceding clause (i)—

(A) by striking ‘‘paternity establishment

percentage’’ and inserting ‘‘IV–D paternity

establishment percentage’’; and

(B) by striking ‘‘(or all States, as the case

may be)’’.

(3) Section 452(g)(3) (42 U.S.C. 652(g)(3)) is

amended—

(A) by striking subparagraph (A) and redesignating subparagraphs (B) and (C) as subparagraphs (A) and (B), respectively;

(B) in subparagraph (A) (as so redesignated), by striking ‘‘the percentage of children born out-of-wedlock in a State’’ and inserting ‘‘the percentage of children in a

State who are born out of wedlock or for

whom support has not been established’’; and

(C) in subparagraph (B) (as so redesignated)—

(i) by inserting ‘‘and overall performance

in child support enforcement’’ after ‘‘paternity establishment percentages’’; and

(ii) by inserting ‘‘and securing support’’ before the period.

(e) TITLE IV–A PAYMENT REDUCTION.—Section 403 (42 U.S.C. 603) is amended—

(1) in subsection (a), by striking ‘‘1958—’’

and inserting ‘‘1958—’’ (subject to subsection

(h))—’’;

(2) in subsection (h), by striking all that

precedes paragraph (3) and inserting the following:

‘‘(h)(1) If the Secretary finds, with respect

to a State program under this part in a fiscal

year beginning on or after October 1, 1996—

‘‘(A)(i) on the basis of data submitted by a

State pursuant to section 454(15)(B), that the

State program in such fiscal year failed to

achieve the IV–D paternity establishment

percentage (as defined in section 452(g)(2)(A))

or the appropriate level of overall performance in child support enforcement (as defined in section 458(b)(2)), or to meet other

performance measures that may be established by the Secretary, or

‘‘(ii) on the basis of an audit or audits of

such State data conducted pursuant to section 452(a)(4)(C), that the State data submitted pursuant to section 454(15)(B) is incomplete or unreliable; and

‘‘(B) that, with respect to the succeeding

fiscal year—

‘‘(i) the State failed to take sufficient corrective action to achieve the appropriate

performance levels as described in subparagraph (A)(i), or

‘‘(ii) the data submitted by the State pursuant to section 454(15)(B) is incomplete or

unreliable,

the amounts otherwise payable to the State

under this part for quarters following the

end of such succeeding fiscal year, prior to

quarters following the end of the first quarter throughout which the State program is

in compliance with such performance requirement, shall be reduced by the percentage specified in paragraph (2).

‘‘(2) The reductions required under paragraph (1) shall be—

‘‘(A) not less than 1 nor more than 2 percent, or

‘‘(B) not less than 2 nor more than 3 percent, if the finding is the 2nd consecutive

finding made pursuant to paragraph (1), or

‘‘(C) not less than 3 nor more than 5 percent, if the finding is the 3rd or a subsequent

consecutive such finding.’’; and

(3) in subsection (h)(3), by striking ‘‘not in

full compliance’’ and all that follows and inserting ‘‘determined as a result of an audit

to have submitted incomplete or unreliable

data pursuant to section 454(15)(B), shall be

determined to have submitted adequate data

if the Secretary determines that the extent

of the incompleteness or unreliability of the

data is of a technical nature which does not

adversely affect the determination of the

level of the State’s performance.’’.

(f) EFFECTIVE DATES.—

(1) INCENTIVE ADJUSTMENTS.—(A) The

amendments made by subsections (a), (b),

and (c) shall become effective October 1, 1996,

except to the extent provided in subparagraph (B).

(B) Section 458 of the Social Security Act,

as in effect immediately before the date of

the enactment of this section, shall be effective for purposes of incentive payments to

States for fiscal years before fiscal year 1998.

(2) PENALTY REDUCTIONS.—(A) The amendments made by subsection (d) shall become

effective with respect to calendar quarters

beginning on and after the date of enactment

of this Act.

(B) The amendments made by subsection

(e) shall become effective with respect to calendar quarters beginning on and after the

date that is 1 year after the date of enactment of this Act.

SEC. 446. STATE LAWS CONCERNING PATERNITY

ESTABLISHMENT.

(a) STATE LAWS REQUIRED.—Section

466(a)(5) (42 U.S.C. 666(a)(5)) is amended—

(1) by striking ‘‘(5)’’ and inserting the following:

‘‘(5) PROCEDURES CONCERNING PATERNITY ESTABLISHMENT.—’’;

(2) in subparagraph (A)—

(A) by striking ‘‘(A)(i)’’ and inserting the

following:

‘‘(A) ESTABLISHMENT PROCESS AVAILABLE

FROM BIRTH UNTIL AGE EIGHTEEN.—(i)’’; and

(B) by indenting clauses (i) and (ii) so that

the left margin of such clauses is 2 ems to

the right of the left margin of paragraph (4);

(3) in subparagraph (B)—

(A) by striking ‘‘(B)’’ and inserting the following:

‘‘(B) PROCEDURES CONCERNING GENETIC

TESTING.—(i)’’;

(B) in clause (i), as redesignated, by inserting before the period ‘‘, where such request is

supported by a sworn statement (I) by such

party alleging paternity setting forth facts

establishing a reasonable possibility of the

requisite sexual contact of the parties, or (II)

by such party denying paternity setting

forth facts establishing a reasonable possibility of the nonexistence of sexual contact

of the parties;’’;

(C) by inserting after and below clause (i)

(as redesignated) the following new clause:

‘‘(ii) Procedures which require the State

agency, in any case in which such agency orders genetic testing—

‘‘(I) to pay costs of such tests, subject to

recoupment (where the State so elects) from

the putative father if paternity is established; and

‘‘(II) to obtain additional testing in any

case where an original test result is disputed, upon request and advance payment by

the disputing party.’’;

(4) by striking subparagraphs (C) and (D)

and inserting the following:

‘‘(C) PATERNITY ACKNOWLEDGMENT.—(i) Procedures for a simple civil process for voluntarily acknowledging paternity under which

the State must provide that, before a mother

and a putative father can sign an acknowledgment of paternity, the putative father

and the mother must be given notice, orally,

in writing, and in a language that each can

understand, of the alternatives to, the legal

consequences of, and the rights (including, if

1 parent is a minor, any rights afforded due

to minority status) and responsibilities that

arise from, signing the acknowledgment.

‘‘(ii) Such procedures must include a hospital-based program for the voluntary acknowledgment of paternity focusing on the

period immediately before or after the birth

of a child.

‘‘(iii) Such procedures must require the

State agency responsible for maintaining

birth records to offer voluntary paternity establishment services.

‘‘(iv) The Secretary shall prescribe regulations governing voluntary paternity establishment services offered by hospitals and

birth record agencies. The Secretary shall

prescribe regulations specifying the types of

other entities that may offer voluntary paternity establishment services, and gov-
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erning the provision of such services, which

shall include a requirement that such an entity must use the same notice provisions

used by, the same materials used by, provide

the personnel providing such services with

the same training provided by, and evaluate

the provision of such services in the same

manner as, voluntary paternity establishment programs of hospitals and birth record

agencies.

‘‘(v) Such procedures must require the

State and those required to establish paternity to use only the affidavit developed

under section 452(a)(7) for the voluntary acknowledgment of paternity, and to give full

faith and credit to such an affidavit signed in

any other State.

‘‘(D) STATUS OF SIGNED PATERNITY ACKNOWLEDGMENT.—(i) Procedures under which

a signed acknowledgment of paternity is

considered a legal finding of paternity, subject to the right of any signatory to rescind

the acknowledgment within 60 days.

‘‘(ii)(I) Procedures under which, after the

60-day period referred to in clause (i), a

signed acknowledgment of paternity may be

challenged in court only on the basis of

fraud, duress, or material mistake of fact,

with the burden of proof upon the challenger,

and under which the legal responsibilities

(including child support obligations) of any

signatory arising from the acknowledgment

may not be suspended during the challenge,

except for good cause shown.

‘‘(II) Procedures under which, after the 60-

day period referred to in clause (i), a minor

who signs an acknowledgment of paternity

other than in the presence of a parent or

court-appointed guardian ad litem may rescind the acknowledgment in a judicial or

administrative proceeding, until the earlier

of—

‘‘(aa) attaining the age of majority; or

‘‘(bb) the date of the first judicial or administrative proceeding brought (after the

signing) to establish a child support obligation, visitation rights, or custody rights with

respect to the child whose paternity is the

subject of the acknowledgment, and at which

the minor is represented by a parent, guardian ad litem, or attorney.’’;

(5) by striking subparagraph (E) and inserting the following:

‘‘(E) BAR ON ACKNOWLEDGMENT RATIFICATION PROCEEDINGS.—Procedures under which

no judicial or administrative proceedings are

required or permitted to ratify an unchallenged acknowledgment of paternity.’’;

(6) by striking subparagraph (F) and inserting the following:

‘‘(F) ADMISSIBILITY OF GENETIC TESTING RESULTS.—Procedures—

‘‘(i) requiring that the State admit into

evidence, for purposes of establishing paternity, results of any genetic test that is—

‘‘(I) of a type generally acknowledged, by

accreditation bodies designated by the Secretary, as reliable evidence of paternity; and

‘‘(II) performed by a laboratory approved

by such an accreditation body;

‘‘(ii) that any objection to genetic testing

results must be made in writing not later

than a specified number of days before any

hearing at which such results may be introduced into evidence (or, at State option, not

later than a specified number of days after

receipt of such results); and

‘‘(iii) that, if no objection is made, the test

results are admissible as evidence of paternity without the need for foundation testimony or other proof of authenticity or accuracy.’’; and

(7) by adding after subparagraph (H) the

following new subparagraphs:

‘‘(I) NO RIGHT TO JURY TRIAL.—Procedures

providing that the parties to an action to establish paternity are not entitled to jury

trial.

‘‘(J) TEMPORARY SUPPORT ORDER BASED ON

PROBABLE PATERNITY IN CONTESTED CASES.—

Procedures which require that a temporary

order be issued, upon motion by a party, requiring the provision of child support pending an administrative or judicial determination of parentage, where there is clear and

convincing evidence of paternity (on the

basis of genetic tests or other evidence).

‘‘(K) PROOF OF CERTAIN SUPPORT AND PATERNITY ESTABLISHMENT COSTS.—Procedures

under which bills for pregnancy, childbirth,

and genetic testing are admissible as evidence without requiring third-party foundation testimony, and shall constitute prima

facie evidence of amounts incurred for such

services and testing on behalf of the child.

‘‘(L) WAIVER OF STATE DEBTS FOR COOPERATION.—At the option of the State, procedures

under which the tribunal establishing paternity and support has discretion to waive

rights to all or part of amounts owed to the

State (but not to the mother) for costs related to pregnancy, childbirth, and genetic

testing and for public assistance paid to the

family where the father cooperates or acknowledges paternity before or after genetic

testing.

‘‘(M) STANDING OF PUTATIVE FATHERS.—

Procedures ensuring that the putative father

has a reasonable opportunity to initiate a

paternity action.’’.

(b) NATIONAL PATERNITY ACKNOWLEDGMENT

AFFIDAVIT.—Section 452(a)(7) (42 U.S.C.

652(a)(7)) is amended by inserting ‘‘, and develop an affidavit to be used for the voluntary acknowledgment of paternity which

shall include the social security account

number of each parent’’ before the semicolon.

(c) TECHNICAL AMENDMENT.—Section 468 (42

U.S.C. 668) is amended by striking ‘‘a simple

civil process for voluntarily acknowledging

paternity and’’.

SEC. 447. OUTREACH FOR VOLUNTARY PATERNITY ESTABLISHMENT.

(a) STATE PLAN REQUIREMENT.—Section

454(23) (42 U.S.C. 654(23)) is amended by adding at the end the following new subparagraph:

‘‘(C) publicize the availability and encourage the use of procedures for voluntary establishment of paternity and child support

through a variety of means, which—

‘‘(i) include distribution of written materials at health care facilities (including hospitals and clinics), and other locations such

as schools;

‘‘(ii) may include pre-natal programs to

educate expectant couples on individual and

joint rights and responsibilities with respect

to paternity (and may require all expectant

recipients of assistance under part A to participate in such pre-natal programs, as an

element of cooperation with efforts to establish paternity and child support);

‘‘(iii) include, with respect to each child

discharged from a hospital after birth for

whom paternity or child support has not

been established, reasonable follow-up efforts (including at least one contact of each

parent whose whereabouts are known, except

where there is reason to believe such followup efforts would put mother or child at risk),

providing—

‘‘(I) in the case of a child for whom paternity has not been established, information

on the benefits of and procedures for establishing paternity; and

‘‘(II) in the case of a child for whom paternity has been established but child support

has not been established, information on the

benefits of and procedures for establishing a

child support order, and an application for

child support services;’’.

(b) ENHANCED FEDERAL MATCHING.—Section

455(a)(1)(C) (42 U.S.C. 655(a)(1)(C)) is

amended—

(1) by inserting ‘‘(i)’’ before ‘‘laboratory

costs’’, and

(2) by inserting before the semicolon ‘‘, and

(ii) costs of outreach programs designed to

encourage voluntary acknowledgment of paternity’’.

(c) EFFECTIVE DATES.—(1) The amendments

made by subsection (a) shall become effective October 1, 1997.

(2) The amendments made by subsection

(b) shall be effective with respect to calendar

quarters beginning on and after October 1,

1996.

Subtitle F—Establishment and Modification

of Support Orders

SEC. 451. NATIONAL CHILD SUPPORT GUIDELINES COMMISSION.

(a) ESTABLISHMENT.—There is hereby established a commission to be known as the

‘‘National Child Support Guidelines Commission’’ (in this section referred to as the

‘‘Commission’’).

(b) GENERAL DUTIES.—The Commission

shall develop a national child support guideline for consideration by the Congress that is

based on a study of various guideline models,

the benefits and deficiencies of such models,

and any needed improvements.

(c) MEMBERSHIP.—

(1) NUMBER; APPOINTMENT.—

(A) IN GENERAL.—The Commission shall be

composed of 12 individuals appointed jointly

by the Secretary of Health and Human Services and the Congress, not later than January 15, 1997, of which—

(i) 2 shall be appointed by the Chairman of

the Committee on Finance of the Senate,

and 1 shall be appointed by the ranking minority member of the Committee;

(ii) 2 shall be appointed by the Chairman of

the Committee on Ways and Means of the

House of Representatives, and 1 shall be appointed by the ranking minority member of

the Committee; and

(iii) 6 shall be appointed by the Secretary

of Health and Human Services.

(B) QUALIFICATIONS OF MEMBERS.—Members

of the Commission shall have expertise and

experience in the evaluation and development of child support guidelines. At least 1

member shall represent advocacy groups for

custodial parents, at least 1 member shall

represent advocacy groups for noncustodial

parents, and at least 1 member shall be the

director of a State program under part D of

title IV of the Social Security Act.

(2) TERMS OF OFFICE.—Each member shall

be appointed for a term of 2 years. A vacancy

in the Commission shall be filled in the manner in which the original appointment was

made.

(d) COMMISSION POWERS, COMPENSATION,

ACCESS TO INFORMATION, AND SUPERVISION.—

The first sentence of subparagraph (C), the

first and third sentences of subparagraph

(D), subparagraph (F) (except with respect to

the conduct of medical studies), clauses (ii)

and (iii) of subparagraph (G), and subparagraph (H) of section 1886(e)(6) of the Social

Security Act shall apply to the Commission

in the same manner in which such provisions

apply to the Prospective Payment Assessment Commission.

(e) REPORT.—Not later than 2 years after

the appointment of members, the Commission shall submit to the President, the Committee on Ways and Means of the House of

Representatives, and the Committee on Finance of the Senate, a recommended national child support guideline and a final assessment of issues relating to such a proposed national child support guideline.

(f) TERMINATION.—The Commission shall

terminate 6 months after the submission of

the report described in subsection (e).
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SEC. 452. SIMPLIFIED PROCESS FOR REVIEW AND

ADJUSTMENT OF CHILD SUPPORT

ORDERS.

(a) IN GENERAL.—Section 466(a)(10) (42

U.S.C. 666(a)(10)) is amended to read as follows:

‘‘(10) PROCEDURES FOR MODIFICATION OF SUPPORT ORDERS.—

‘‘(A)(i) Procedures under which—

‘‘(I) every 3 years, at the request of either

parent subject to a child support order, the

State shall review and, as appropriate, adjust the order in accordance with the guidelines established under section 467(a) if the

amount of the child support award under the

order differs from the amount that would be

awarded in accordance with such guidelines,

without a requirement for any other change

in circumstances; and

‘‘(II) upon request at any time of either

parent subject to a child support order, the

State shall review and, as appropriate, adjust the order in accordance with the guidelines established under section 467(a) based

on a substantial change in the circumstances

of either such parent.

‘‘(ii) Such procedures shall require both

parents subject to a child support order to be

notified of their rights and responsibilities

provided for under clause (i) at the time the

order is issued and in the annual information

exchange form provided under subparagraph

(B).

‘‘(B) Procedures under which each child

support order issued or modified in the State

after the effective date of this subparagraph

shall require the parents subject to the order

to provide each other with a complete statement of their respective financial condition

annually on a form which shall be established by the Secretary and provided by the

State. The Secretary shall establish regulations for the enforcement of such exchange

of information.’’.

Subtitle G—Enforcement of Support Orders

SEC. 461. FEDERAL INCOME TAX REFUND OFFSET.

(a) CHANGED ORDER OF REFUND DISTRIBUTION UNDER INTERNAL REVENUE CODE.—Section 6402(c) of the Internal Revenue Code of

1986 is amended by striking the 3rd sentence.

(b) ELIMINATION OF DISPARITIES IN TREATMENT OF ASSIGNED AND NON-ASSIGNED ARREARAGES.—(1) Section 464(a) (42 U.S.C.

664(a)) is amended—

(A) by striking ‘‘(a)’’ and inserting ‘‘(a)

OFFSET AUTHORIZED.—’’;

(B) in paragraph (1)—

(i) in the first sentence, by striking ‘‘which

has been assigned to such State pursuant to

section 402(a)(26) or section 471(a)(17)’’; and

(ii) in the second sentence, by striking ‘‘in

accordance with section 457 (b)(4) or (d)(3)’’

and inserting ‘‘as provided in paragraph (2)’’;

(C) in paragraph (2), to read as follows:

‘‘(2) The State agency shall distribute

amounts paid by the Secretary of the Treasury pursuant to paragraph (1)—

‘‘(A) in accordance with section 457 (a)(4)

or (d)(3), in the case of past-due support assigned to a State pursuant to section

402(a)(26) or section 471(a)(17); and

‘‘(B) to or on behalf of the child to whom

the support was owed, in the case of past-due

support not so assigned.’’;

(D) in paragraph (3)—

(i) by striking ‘‘or (2)’’ each place it appears; and

(ii) in subparagraph (B), by striking ‘‘under

paragraph (2)’’ and inserting ‘‘on account of

past-due support described in paragraph

(2)(B)’’.

(2) Section 464(b) (42 U.S.C. 664(b)) is

amended—

(A) by striking ‘‘(b)(1)’’ and inserting ‘‘(b)

REGULATIONS.—’’; and

(B) by striking paragraph (2).

(3) Section 464(c) (42 U.S.C. 664(c)) is

amended—

(A) by striking ‘‘(c)(1) Except as provided

in paragraph (2), as’’ and inserting ‘‘(c) DEFINITION.—As’’; and

(B) by striking paragraphs (2) and (3).

(c) TREATMENT OF LUMP-SUM TAX REFUND

UNDER AFDC.—

(1) EXEMPTION FROM LUMP-SUM RULE.—Section 402(a)(17) (42 U.S.C. 602(a)(17)) is amended by adding at the end the following: ‘‘but

this paragraph shall not apply to income received by a family that is attributable to a

child support obligation owed with respect to

a member of the family and that is paid to

the family from amounts withheld from a

Federal income tax refund otherwise payable

to the person owing such obligation, to the

extent that such income is placed in a qualified asset account (as defined in section

406(j)) the total amounts in which, after such

placement, does not exceed $10,000;’’.

(2) QUALIFIED ASSET ACCOUNT DEFINED.—

Section 406 (42 U.S.C. 606), as amended by

section 402(g)(2) of this Act, is amended by

adding at the end the following:

‘‘(j)(1) The term ‘qualified asset account’

means a mechanism approved by the State

(such as individual retirement accounts, escrow accounts, or savings bonds) that allows

savings of a family receiving aid to families

with dependent children to be used for qualified distributions.

‘‘(2) The term ‘qualified distribution’

means a distribution from a qualified asset

account for expenses directly related to 1 or

more of the following purposes:

‘‘(A) The attendance of a member of the

family at any education or training program.

‘‘(B) The improvement of the employability (including self-employment) of a

member of the family (such as through the

purchase of an automobile).

‘‘(C) The purchase of a home for the family.

‘‘(D) A change of the family residence.’’.

(d) EFFECTIVE DATE.—The amendments

made by this section shall become effective

October 1, 1999.

SEC. 462. INTERNAL REVENUE SERVICE COLLECTION OF ARREARS.

(a) AMENDMENT TO INTERNAL REVENUE

CODE.—Section 6305(a) of the Internal Revenue Code of 1986 is amended—

(1) in paragraph (1), by inserting ‘‘except as

provided in paragraph (5)’’ after ‘‘collected’’;

(2) by striking ‘‘and’’ at the end of paragraph (3);

(3) by striking the period at the end of

paragraph (4) and inserting a comma;

(4) by adding after paragraph (4) the following new paragraph:

‘‘(5) no additional fee may be assessed for

adjustments to an amount previously certified pursuant to such section 452(b) with respect to the same obligor.’’; and

(5) by striking ‘‘Secretary of Health, Education, and Welfare’’ each place it appears

and inserting ‘‘Secretary of Health and

Human Services’’.

(b) EFFECTIVE DATE.—The amendments

made by this section shall become effective

October 1, 1997.

SEC. 463. AUTHORITY TO COLLECT SUPPORT

FROM FEDERAL EMPLOYEES.

(a) CONSOLIDATION AND STREAMLINING OF

AUTHORITIES.—

(1) Section 459 (42 U.S.C. 659) is amended in

the caption by inserting ‘‘INCOME WITHHOLDING,’’ before ‘‘GARNISHMENT’’.

(2) Section 459(a) (42 U.S.C. 659(a)) is

amended—

(A) by striking ‘‘(a)’’ and inserting ‘‘(a)

CONSENT TO SUPPORT ENFORCEMENT.—

(B) by striking ‘‘section 207’’ and inserting

‘‘section 207 of this Act and 38 U.S.C. 5301’’;

and

(C) by striking all that follows ‘‘a private

person,’’ and inserting ‘‘to withholding in accordance with State law pursuant to subsections (a)(1) and (b) of section 466 and regulations of the Secretary thereunder, and to

any other legal process brought, by a State

agency administering a program under this

part or by an individual obligee, to enforce

the legal obligation of such individual to

provide child support or alimony.’’.

(3) Section 459(b) (42 U.S.C. 659(b)) is

amended to read as follows:

‘‘(b) CONSENT TO REQUIREMENTS APPLICABLE TO PRIVATE PERSON.— Except as otherwise provided herein, each entity specified in

subsection (a) shall be subject, with respect

to notice to withhold income pursuant to

subsection (a)(1) or (b) of section 466, or to

any other order or process to enforce support

obligations against an individual (if such

order or process contains or is accompanied

by sufficient data to permit prompt identification of the individual and the moneys involved), to the same requirements as would

apply if such entity were a private person.’’.

(4) Section 459(c) (42 U.S.C. 659(c)) is redesignated and relocated as paragraph (2) of

subsection (f), and is amended—

(A) by striking ‘‘responding to interrogatories pursuant to requirements imposed by

section 461(b)(3)’’ and inserting ‘‘taking actions necessary to comply with the requirements of subsection (A) with regard to any

individual’’; and

(B) by striking ‘‘any of his duties’’ and all

that follows and inserting ‘‘such duties.’’.

(5) Section 461 (42 U.S.C. 661) is amended by

striking subsection (b), and section 459 (42

U.S.C. 659) is amended by inserting after subsection (b) (as added by paragraph (3) of this

subsection) the following:

‘‘(c) DESIGNATION OF AGENT; RESPONSE TO

NOTICE OR PROCESS.—(1) The head of each

agency subject to the requirements of this

section shall—

‘‘(A) designate an agent or agents to receive orders and accept service of process;

and

‘‘(B) publish (i) in the appendix of such regulations, (ii) in each subsequent republication of such regulations, and (iii) annually in

the Federal Register, the designation of such

agent or agents, identified by title of position, mailing address, and telephone number.’’.

(6) Section 459 (42 U.S.C. 659) is amended by

striking subsection (d) and by inserting after

subsection (c)(1) (as added by paragraph (5) of

this subsection) the following:

‘‘(2) Whenever an agent designated pursuant to paragraph (1) receives notice pursuant

to subsection (a)(1) or (b) of section 466, or is

effectively served with any order, process, or

interrogatories, with respect to an individual’s child support or alimony payment obligations, such agent shall—

‘‘(A) as soon as possible (but not later than

fifteen days) thereafter, send written notice

of such notice or service (together with a

copy thereof) to such individual at his duty

station or last-known home address;

‘‘(B) within 30 days (or such longer period

as may be prescribed by applicable State

law) after receipt of a notice pursuant to

subsection (a)(1) or (b) of section 466, comply

with all applicable provisions of such section

466; and

‘‘(C) within 30 days (or such longer period

as may be prescribed by applicable State

law) after effective service of any other such

order, process, or interrogatories, respond

thereto.’’.

(7) Section 461 (42 U.S.C. 661) is amended by

striking subsection (c), and section 459 (42

U.S.C. 659) is amended by inserting after subsection (c) (as added by paragraph (5) and

amended by paragraph (6) of this subsection)

the following:

‘‘(d) PRIORITY OF CLAIMS.—In the event

that a governmental entity receives notice

or is served with process, as provided in this
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463

1995 T49.12

section, concerning amounts owed by an individual to more than one person—

‘‘(1) support collection under section 466(b)

must be given priority over any other process, as provided in section 466(b)(7);

‘‘(2) allocation of moneys due or payable to

an individual among claimants under section

466(b) shall be governed by the provisions of

such section 466(b) and regulations thereunder; and

‘‘(3) such moneys as remain after compliance with subparagraphs (A) and (B) shall be

available to satisfy any other such processes

on a first-come, first-served basis, with any

such process being satisfied out of such moneys as remain after the satisfaction of all

such processes which have been previously

served.’’.

(8) Section 459(e) (42 U.S.C. 659(e)) is

amended by striking ‘‘(e)’’ and inserting the

following:

‘‘(e) NO REQUIREMENT TO VARY PAY CYCLES.—’’.

(9) Section 459(f) (42 U.S.C. 659(f)) is amended by striking ‘‘(f)’’ and inserting the following:

‘‘(f) RELIEF FROM LIABILITY.—(1)’’.

(10) Section 461(a) (42 U.S.C. 661(a)) is redesignated and relocated as section 459(g),

and is amended—

(A) by striking ‘‘(g)’’ and inserting the following:

‘‘(g) REGULATIONS.—’’; and

(B) by striking ‘‘section 459’’ and inserting

‘‘this section’’.

(11) Section 462 (42 U.S.C. 662) is amended

by striking subsection (f), and section 459 (42

U.S.C. 659) is amended by inserting the following after subsection (g) (as added by paragraph (10) of this subsection):

‘‘(h) MONEYS SUBJECT TO PROCESS.—(1)

Subject to subsection (i), moneys paid or

payable to an individual which are considered to be based upon remuneration for employment, for purposes of this section—

‘‘(A) consist of—

‘‘(i) compensation paid or payable for personal services of such individual, whether

such compensation is denominated as wages,

salary, commission, bonus, pay, allowances,

or otherwise (including severance pay, sick

pay, and incentive pay);

‘‘(ii) periodic benefits (including a periodic

benefit as defined in section 228(h)(3)) or

other payments—

‘‘(I) under the insurance system established by title II;

‘‘(II) under any other system or fund established by the United States which provides

for the payment of pensions, retirement or

retired pay, annuities, dependents’ or survivors’ benefits, or similar amounts payable

on account of personal services performed by

the individual or any other individual;

‘‘(III) as compensation for death under any

Federal program;

‘‘(IV) under any Federal program established to provide ‘black lung’ benefits; or

‘‘(V) by the Secretary of Veterans Affairs

as pension, or as compensation for a serviceconnected disability or death (except any

compensation paid by such Secretary to a

former member of the Armed Forces who is

in receipt of retired or retainer pay if such

former member has waived a portion of his

retired pay in order to receive such compensation); and

‘‘(iii) worker’s compensation benefits paid

under Federal or State law; but

‘‘(B) do not include any payment—

‘‘(i) by way of reimbursement or otherwise,

to defray expenses incurred by such individual in carrying out duties associated with

his employment; or

‘‘(ii) as allowances for members of the uniformed services payable pursuant to chapter

7 of title 37, United States Code, as prescribed by the Secretaries concerned (defined

by section 101(5) of such title) as necessary

for the efficient performance of duty.’’.

(12) Section 462(g) (42 U.S.C. 662(g)) is redesignated and relocated as section 459(i) (42

U.S.C. 659(i)).

(13)(A) Section 462 (42 U.S.C. 662) is

amended—

(i) in subsection (e)(1), by redesignating

subparagraphs (A), (B), and (C) as clauses (i),

(ii), and (iii); and

(ii) in subsection (e), by redesignating

paragraphs (1) and (2) as subparagraphs (A)

and (B).

(B) Section 459 (42 U.S.C. 659) is amended

by adding at the end the following:

‘‘(j) DEFINITIONS.—For purposes of this section—’’.

(C) Subsections (a) through (e) of section

462 (42 U.S.C. 662), as amended by subparagraph (A) of this paragraph, are relocated

and redesignated as paragraphs (1) through

(4), respectively of section 459(j) (as added by

subparagraph (B) of this paragraph, (42

U.S.C. 659(j)), and the left margin of each of

such paragraphs (1) through (4) is indented 2

ems to the right of the left margin of subsection (i) (as added by paragraph (12) of this

subsection).

(b) CONFORMING AMENDMENTS.—

(1) TO PART D OF TITLE IV.—Sections 461 and

462 (42 U.S.C. 661), as amended by subsection

(a) of this section, are repealed.

(2) TO TITLE 5, UNITED STATES CODE.—Section 5520a of title 5, United States Code, is

amended, in subsections (h)(2) and (i), by

striking ‘‘sections 459, 461, and 462 of the Social Security Act (42 U.S.C. 659, 661, and 662)’’

and inserting ‘‘section 459 of the Social Security Act (42 U.S.C. 659)’’.

(c) MILITARY RETIRED AND RETAINER PAY.—

(1) DEFINITION OF COURT.—Section 1408(a)(1)

of title 10, United States Code, is amended—

(A) by striking ‘‘and’’ at the end of subparagraph (B);

(B) by striking the period at the end of

subparagraph (C) and inserting ‘‘; and’’; and

(C) by adding after subparagraph (C) the

following new paragraph:

‘‘(D) any administrative or judicial tribunal of a State competent to enter orders

for support or maintenance (including a

State agency administering a State program

under part D of title IV of the Social Security Act).’’;

(2) DEFINITION OF COURT ORDER.—Section

1408(a)(2) of such title is amended by inserting ‘‘or a court order for the payment of

child support not included in or accompanied

by such a decree or settlement,’’ before

‘‘which—’’.

(3) PUBLIC PAYEE.—Section 1408(d) of such

title is amended—

(A) in the heading, by striking ‘‘to spouse’’

and inserting ‘‘to (or for benefit of)’’; and

(B) in paragraph (1), in the first sentence,

by inserting ‘‘(or for the benefit of such

spouse or former spouse to a State central

collections unit or other public payee designated by a State, in accordance with part

D of title IV of the Social Security Act, as

directed by court order, or as otherwise directed in accordance with such part D)’’ before ‘‘in an amount sufficient’’.

(4) RELATIONSHIP TO PART D OF TITLE IV.—

Section 1408 of such title is amended by adding at the end the following new subsection:

‘‘(j) RELATIONSHIP TO OTHER LAWS.—In any

case involving a child support order against

a member who has never been married to the

other parent of the child, the provisions of

this section shall not apply, and the case

shall be subject to the provisions of section

459 of the Social Security Act.’’.

(d) EFFECTIVE DATE.—The amendments

made by this section shall become effective 6

months after the date of the enactment of

this Act.

SEC. 464. ENFORCEMENT OF CHILD SUPPORT OBLIGATIONS OF MEMBERS OF THE

ARMED FORCES.

(a) AVAILABILITY OF LOCATOR INFORMATION.—

(1) MAINTENANCE OF ADDRESS INFORMATION.—The Secretary of Defense shall establish a centralized personnel locator service

that includes the address of each member of

the Armed Forces under the jurisdiction of

the Secretary. Upon request of the Secretary

of Transportation, addresses for members of

the Coast Guard shall be included in the centralized personnel locator service.

(2) TYPE OF ADDRESS.—

(A) RESIDENTIAL ADDRESS.—Except as provided in subparagraph (B), the address for a

member of the Armed Forces shown in the

locator service shall be the residential address of that member.

(B) DUTY ADDRESS.—The address for a

member of the Armed Forces shown in the

locator service shall be the duty address of

that member in the case of a member—

(i) who is permanently assigned overseas,

to a vessel, or to a routinely deployable unit;

or

(ii) with respect to whom the Secretary

concerned makes a determination that the

member’s residential address should not be

disclosed due to national security or safety

concerns.

(3) UPDATING OF LOCATOR INFORMATION.—

Within 30 days after a member listed in the

locator service establishes a new residential

address (or a new duty address, in the case of

a member covered by paragraph (2)(B)), the

Secretary concerned shall update the locator

service to indicate the new address of the

member.

(4) AVAILABILITY OF INFORMATION.—The

Secretary of Defense shall make information

regarding the address of a member of the

Armed Forces listed in the locator service

available, on request, to the Federal Parent

Locator Service.

(b) FACILITATING GRANTING OF LEAVE FOR

ATTENDANCE AT HEARINGS.—

(1) REGULATIONS.—The Secretary of each

military department, and the Secretary of

Transportation with respect to the Coast

Guard when it is not operating as a service

in the Navy, shall prescribe regulations to

facilitate the granting of leave to a member

of the Armed Forces under the jurisdiction

of that Secretary in a case in which—

(A) the leave is needed for the member to

attend a hearing described in paragraph (2);

(B) the member is not serving in or with a

unit deployed in a contingency operation (as

defined in section 101 of title 10, United

States Code); and

(C) the exigencies of military service (as

determined by the Secretary concerned) do

not otherwise require that such leave not be

granted.

(2) COVERED HEARINGS.—Paragraph (1) applies to a hearing that is conducted by a

court or pursuant to an administrative process established under State law, in connection with a civil action—

(A) to determine whether a member of the

Armed Forces is a natural parent of a child;

or

(B) to determine an obligation of a member

of the Armed Forces to provide child support.

(3) DEFINITIONS.—For purposes of this subsection:

(A) The term ‘‘court’’ has the meaning

given that term in section 1408(a) of title 10,

United States Code.

(B) The term ‘‘child support’’ has the

meaning given such term in section 462 of

the Social Security Act (42 U.S.C. 662).

(c) PAYMENT OF MILITARY RETIRED PAY IN

COMPLIANCE WITH CHILD SUPPORT ORDERS.—
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(1) DATE OF CERTIFICATION OF COURT

ORDER.—Section 1408 of title 10, United

States Code, is amended—

(A) by redesignating subsection (i) as subsection (j); and

(B) by inserting after subsection (h) the

following new subsection (i):

‘‘(i) CERTIFICATION DATE.—It is not necessary that the date of a certification of the

authenticity or completeness of a copy of a

court order or an order of an administrative

process established under State law for child

support received by the Secretary concerned

for the purposes of this section be recent in

relation to the date of receipt by the Secretary.’’.

(2) PAYMENTS CONSISTENT WITH ASSIGNMENTS OF RIGHTS TO STATES.—Section

1408(d)(1) of such title is amended by inserting after the first sentence the following: ‘‘In

the case of a spouse or former spouse who,

pursuant to section 402(a)(26) of the Social

Security Act (42 U.S.C. 602(26)), assigns to a

State the rights of the spouse or former

spouse to receive support, the Secretary concerned may make the child support payments referred to in the preceding sentence

to that State in amounts consistent with

that assignment of rights.’’.

(3) ARREARAGES OWED BY MEMBERS OF THE

UNIFORMED SERVICES.—Section 1408(d) of such

title is amended by adding at the end the following new paragraph:

‘‘(6) In the case of a court order or an order

of an administrative process established

under State law for which effective service is

made on the Secretary concerned on or after

the date of the enactment of this paragraph

and which provides for payments from the

disposable retired pay of a member to satisfy

the amount of child support set forth in the

order, the authority provided in paragraph

(1) to make payments from the disposable retired pay of a member to satisfy the amount

of child support set forth in a court order or

an order of an administrative process established under State law shall apply to payment of any amount of child support arrearages set forth in that order as well as to

amounts of child support that currently become due.’’.

SEC. 465. MOTOR VEHICLE LIENS.

Section 466(a)(4) (42 U.S.C. 666(a)(4)) is

amended—

(1) by striking ‘‘(4) Procedures’’ and inserting the following:

‘‘(4) LIENS.—

‘‘(A) IN GENERAL.—Procedures’’; and

(2) by adding at the end the following new

subparagraph:

‘‘(B) MOTOR VEHICLE LIENS.—Procedures for

placing liens for arrears of child support on

motor vehicle titles of individuals owing

such arrears equal to or exceeding two

months of support, under which—

‘‘(i) any person owed such arrears may

place such a lien;

‘‘(ii) the State agency administering the

program under this part shall systematically

place such liens;

‘‘(iii) expedited methods are provided for—

‘‘(I) ascertaining the amount of arrears;

‘‘(II) affording the person owing the arrears

or other titleholder to contest the amount of

arrears or to obtain a release upon fulfilling

the support obligation;

‘‘(iv) such a lien has precedence over all

other encumbrances on a vehicle title other

than a purchase money security interest;

and

‘‘(v) the individual or State agency owed

the arrears may execute on, seize, and sell

the property in accordance with State law.’’.

SEC. 466. VOIDING OF FRAUDULENT TRANSFERS.

Section 466(a) (42 U.S.C. 666(a)), as amended

by sections 401(a), 426(a), 431, and 442 of this

Act, is amended by inserting after paragraph

(15) the following:

‘‘(16) FRAUDULENT TRANSFERS.—Procedures

under which—

‘‘(A) the State has in effect—

‘‘(i) the Uniform Fraudulent Conveyance

Act of 1981,

‘‘(ii) the Uniform Fraudulent Transfer Act

of 1984, or

‘‘(iii) another law, specifying indicia of

fraud which create a prima facie case that a

debtor transferred income or property to

avoid payment to a child support creditor,

which the Secretary finds affords comparable rights to child support creditors; and

‘‘(B) in any case in which the State knows

of a transfer by a child support debtor with

respect to which such a prima facie case is

established, the State must—

‘‘(i) seek to void such transfer; or

‘‘(ii) obtain a settlement in the best interests of the child support creditor.’’.

SEC. 467. STATE LAW AUTHORIZING SUSPENSION

OF LICENSES.

Section 466(a) (42 U.S.C. 666(a)), as amended

by sections 401(a), 426(a), 431, 442, and 466 of

this Act, is amended by inserting after paragraph (16) the following:

‘‘(17) AUTHORITY TO WITHHOLD OR SUSPEND

LICENSES.—Procedures under which the State

has (and uses in appropriate cases) authority

(subject to appropriate due process safeguards) to withhold or suspend, or to restrict

the use of driver’s licenses, and professional

and occupational licenses of individuals

owing overdue child support or failing, after

receiving appropriate notice, to comply with

subpoenas or warrants relating to paternity

or child support proceedings.’’.

SEC. 468. REPORTING ARREARAGES TO CREDIT

BUREAUS.

Section 466(a)(7) (42 U.S.C. 666(a)(7)) is

amended to read as follows:

‘‘(7) REPORTING ARREARAGES TO CREDIT BUREAUS.—(A) Procedures (subject to safeguards pursuant to subparagraph (B)) requiring the State to report periodically to consumer reporting agencies (as defined in section 603(f) of the Fair Credit Reporting Act

(15 U.S.C. 1681a(f)) the name of any absent

parent who is delinquent by 90 days or more

in the payment of support, and the amount

of overdue support owed by such parent.

‘‘(B) Procedures ensuring that, in carrying

out subparagraph (A), information with respect to an absent parent is reported—

‘‘(i) only after such parent has been afforded all due process required under State

law, including notice and a reasonable opportunity to contest the accuracy of such information; and

‘‘(ii) only to an entity that has furnished

evidence satisfactory to the State that the

entity is a consumer reporting agency.’’.

SEC. 469. EXTENDED STATUTE OF LIMITATION

FOR COLLECTION OF ARREARAGES.

(a) AMENDMENTS.—Section 466(a)(9) (42

U.S.C. 666(a)(9)) is amended—

(1) by striking ‘‘(9) Procedures’’ and inserting the following:

‘‘(9) LEGAL TREATMENT OF ARREARS.—

‘‘(A) FINALITY.—Procedures’’;

(2) by redesignating subparagraphs (A), (B),

and (C) as clauses (i), (ii), and (iii), respectively, and by indenting each of such clauses

2 additional ems to the right; and

(3) by adding after and below subparagraph

(A), as redesignated, the following new subparagraph:

‘‘(B) STATUTE OF LIMITATIONS.—Procedures

under which the statute of limitations on

any arrearages of child support extends at

least until the child owed such support is 30

years of age.’’.

(b) APPLICATION OF REQUIREMENT.—The

amendment made by this section shall not be

read to require any State law to revive any

payment obligation which had lapsed prior

to the effective date of such State law.

SEC. 470. CHARGES FOR ARREARAGES.

(a) STATE LAW REQUIREMENT.—Section

466(a) (42 U.S.C. 666(a)), as amended by sections 401(a), 426(a), 431, 442, 466, and 467 of

this Act, is amended by inserting after paragraph (17) the following:

‘‘(18) CHARGES FOR ARREARAGES.—Procedures providing for the calculation and collection of interest or penalties for arrearages

of child support, and for distribution of such

interest or penalties collected for the benefit

of the child (except where the right to support has been assigned to the State).’’.

(b) REGULATIONS.—The Secretary of Health

and Human Services shall establish by regulation a rule to resolve choice of law conflicts arising in the implementation of the

amendment made by subsection (a).

(c) CONFORMING AMENDMENT.—Section

454(21) (42 U.S.C. 654(21)) is repealed.

(d) EFFECTIVE DATE.—The amendments

made by this section shall be effective with

respect to arrearages accruing on or after

October 1, 1998.

SEC. 471. DENIAL OF PASSPORTS FOR NONPAYMENT OF CHILD SUPPORT.

(a) HHS CERTIFICATION PROCEDURE.—

(1) SECRETARIAL RESPONSIBILITY.—Section

452 (42 U.S.C. 652), as amended by sections

415(a)(3) and 417 of this Act, is amended by

adding at the end the following new subsection:

‘‘(l) CERTIFICATIONS FOR PURPOSES OF PASSPORT RESTRICTIONS.—

‘‘(1) IN GENERAL.—Where the Secretary receives a certification by a State agency in

accordance with the requirements of section

454(28) that an individual owes arrearages of

child support in an amount exceeding $5,000

or in an amount exceeding 24 months’ worth

of child support, the Secretary shall transmit such certification to the Secretary of

State for action (with respect to denial, revocation, or limitation of passports) pursuant

to section 471(b) of the Individual Responsibility Act of 1995.

‘‘(2) LIMIT ON LIABILITY.—The Secretary

shall not be liable to an individual for any

action with respect to a certification by a

State agency under this section.’’.

(2) STATE CSE AGENCY RESPONSIBILITY.—

Section 454 (42 U.S.C. 654), as amended by

sections 404(a), 414(b), and 422(a) of this Act,

is amended—

(A) by striking ‘‘and’’ at the end of paragraph (26);

(B) by striking the period at the end of

paragraph (27) and inserting ‘‘; and’’; and

(C) by adding after paragraph (27) the following new paragraph:

‘‘(28) provide that the State agency will

have in effect a procedure (which may be

combined with the procedure for tax refund

offset under section 464) for certifying to the

Secretary, for purposes of the procedure

under section 452(l) (concerning denial of

passports) determinations that individuals

owe arrearages of child support in an amount

exceeding $5,000 or in an amount exceeding 24

months’ worth of child support, under which

procedure—

‘‘(A) each individual concerned is afforded

notice of such determination and the consequences thereof, and an opportunity to

contest the determination; and

‘‘(B) the certification by the State agency

is furnished to the Secretary in such format,

and accompanied by such supporting documentation, as the Secretary may require.’’.

(b) STATE DEPARTMENT PROCEDURE FOR DENIAL OF PASSPORTS.—

(1) IN GENERAL.—The Secretary of State,

upon certification by the Secretary of Health

and Human Services, in accordance with section 452(l) of the Social Security Act, that an

individual owes arrearages of child support

in excess of $5,000, shall refuse to issue a

passport to such individual, and may revoke,
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465

1995 T49.12

restrict, or limit a passport issued previously

to such individual.

(2) LIMIT ON LIABILITY.—The Secretary of

State shall not be liable to an individual for

any action with respect to a certification by

a State agency under this section.

(c) EFFECTIVE DATE.—This section and the

amendments made by this section shall become effective October 1, 1996.

SEC. 472. INTERNATIONAL CHILD SUPPORT ENFORCEMENT.

(a) SENSE OF THE CONGRESS THAT THE

UNITED STATES SHOULD RATIFY THE UNITED

NATIONS CONVENTION OF 1956.—It is the sense

of the Congress that the United States

should ratify the United Nations Convention

of 1956.

(b) TREATMENT OF INTERNATIONAL CHILD

SUPPORT CASES AS INTERSTATE CASES.—Section 454 (42 U.S.C. 654), as amended by sections 404(a), 414(b), 422(a), and 471(a)(2) of this

Act, is amended—

(1) by striking ‘‘and’’ at the end of paragraph (27);

(2) by striking the period at the end of

paragraph (28) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (28) the following:

‘‘(29) provide that the State must treat

international child support cases in the same

manner as the State treats interstate child

support cases.’’.

SEC. 473. SEIZURE OF LOTTERY WINNINGS, SETTLEMENTS, PAYOUTS, AWARDS, AND

BEQUESTS, AND SALE OF FORFEITED PROPERTY, TO PAY CHILD

SUPPORT ARREARAGES.

Section 466(a) (42 U.S.C. 666(a)), as amended

by sections 401(a), 426(a), 431, 442, 466, 467, and

470(a) of this Act, is amended by inserting

after paragraph (18) the following:

‘‘(19) Procedures, in addition to other income withholding procedures, under which a

lien is imposed against property with the following effect:

‘‘(A) The distributor of the winnings from

a State lottery or State-sanctioned or tribalsanctioned gambling house or casino shall—

‘‘(i) suspend payment of the winnings from

the person otherwise entitled to the payment

until an inquiry is made to and a response is

received from the State child support enforcement agency as to whether the person

owes a child support arrearage; and

‘‘(ii) if there is such an arrearage, withhold

from the payment the lesser of the amount

of the payment or the amount of the arrearage, and pay the amount withheld to the

agency for distribution.

‘‘(B) The person required to make a payment under a policy of insurance or a settlement of a claim made with respect to the

policy shall—

‘‘(i) suspend the payment until an inquiry

is made to and a response received from the

agency as to whether the person otherwise

entitled to the payment owes a child support

arrearage; and

‘‘(ii) if there is such an arrearage, withhold

from the payment the lesser of the amount

of the payment or the amount of the arrearage, and pay the amount withheld to the

agency for distribution.

‘‘(C) The payor of any amount pursuant to

an award, judgment, or settlement in any action brought in Federal or State court

shall—

‘‘(i) suspend the payment of the amount

until an inquiry is made to and a response is

received from the agency as to whether the

person otherwise entitled to the payment

owes a child support arrearage; and

‘‘(ii) if there is such an arrearage, withhold

from the payment the lesser of the amount

of the payment or the amount of the arrearage, and pay the amount withheld to the

agency for distribution.

‘‘(D) If the State seizes property forfeited

to the State by an individual by reason of a

criminal conviction, the State shall—

‘‘(i) hold the property until an inquiry is

made to and a response is received from the

agency as to whether the individual owes a

child support arrearage; and

‘‘(ii) if there is such an arrearage, sell the

property and, after satisfying the claims of

all other private or public claimants to the

property and deducting from the proceeds of

the sale the attendant costs (such as for towing, storage, and the sale), pay the lesser of

the remaining proceeds or the amount of the

arrearage directly to the agency for distribution.

‘‘(E) Any person required to make a payment in respect of a decedent shall—

‘‘(i) suspend the payment until an inquiry

is made to and a response received from the

agency as to whether the person otherwise

entitled to the payment owes a child support

arrearage; and

‘‘(ii) if there is such an arrearage, withhold

from the payment the lesser of the amount

of the payment or the amount of the arrearage, and pay the amount withheld to the

agency for distribution.’’.

SEC. 474. LIABILITY OF GRANDPARENTS FOR FINANCIAL SUPPORT OF CHILDREN OF

THEIR MINOR CHILDREN.

Section 466(a) (42 U.S.C. 666(a)), as amended

by sections 401(a), 426(a), 431, 442, 466, 467,

470(a), and 473 of this Act, is amended by inserting after paragraph (19) the following:

‘‘(20) Procedures under which each parent

of an individual who has not attained 18

years of age is liable for the financial support of any child of the individual to the extent that the individual is unable to provide

such support. The preceding sentence shall

not apply to the State if the State plan explicitly provides for such inapplicability.’’.

SEC. 475. SENSE OF THE CONGRESS REGARDING

PROGRAMS FOR NONCUSTODIAL

PARENTS UNABLE TO MEET CHILD

SUPPORT OBLIGATIONS.

It is the sense of the Congress that the

States should develop programs, such as the

program of the State of Wisconsin known as

the ‘‘Children’s First Program’’, that are designed to work with noncustodial parents

who are unable to meet their child support

obligations.

Subtitle H—Medical Support

SEC. 481. TECHNICAL CORRECTION TO ERISA

DEFINITION OF MEDICAL CHILD

SUPPORT ORDER.

(a) IN GENERAL.—Section 609(a)(2)(B) of the

Employee Retirement Income Security Act

of 1974 (29 U.S.C. 1169(a)(2)(B)) is amended—

(1) by striking ‘‘issued by a court of competent jurisdiction’’;

(2) by striking the period at the end of

clause (ii) and inserting a comma; and

(3) by adding, after and below clause (ii),

the following:

‘‘if such judgment, decree, or order (I) is

issued by a court of competent jurisdiction

or (II) is issued by an administrative adjudicator and has the force and effect of law

under applicable State law.’’.

(b) EFFECTIVE DATE.—

(1) IN GENERAL.—The amendments made by

this section shall take effect on the date of

the enactment of this Act.

(2) PLAN AMENDMENTS NOT REQUIRED UNTIL

JANUARY 1, 1996.—Any amendment to a plan

required to be made by an amendment made

by this section shall not be required to be

made before the first plan year beginning on

or after January 1, 1996, if—

(A) during the period after the date before

the date of the enactment of this Act and before such first plan year, the plan is operated

in accordance with the requirements of the

amendments made by this section, and

(B) such plan amendment applies retroactively to the period after the date before

the date of the enactment of this Act and before such first plan year.

A plan shall not be treated as failing to be

operated in accordance with the provisions

of the plan merely because it operates in accordance with this paragraph.

SEC. 482. EXTENSION OF MEDICAID ELIGIBILITY

FOR FAMILIES LOSING AFDC DUE TO

INCREASED CHILD SUPPORT COLLECTIONS.

Section 402(a) (42 U.S.C. 602(a)), as amended

by the other provisions of this Act, is

amended—

(1) by striking ‘‘and’’ at the end of paragraph (55);

(2) by striking the period at the end of

paragraph (56) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (56) the following:

‘‘(57) provide that each member of a family

which would be eligible for aid under the

State plan but for the receipt of child support payments shall be considered to be receiving such aid for purposes of eligibility

for medical assistance under the State plan

approved under title XIX for so long as the

family would (but for such receipt) be eligible for such aid.’’.

Subtitle I—Effect of Enactment

SEC. 491. EFFECTIVE DATES.

(a) IN GENERAL.—Except as otherwise specifically provided (but subject to subsections

(b) and (c))—

(1) provisions of this title requiring enactment or amendment of State laws under section 466 of the Social Security Act, or revision of State plans under section 454 of such

Act, shall be effective with respect to periods

beginning on and after October 1, 1996; and

(2) all other provisions of this title shall

become effective upon enactment.

(b) GRACE PERIOD FOR STATE LAW

CHANGES.—The provisions of this title shall

become effective with respect to a State on

the later of—

(1) the date specified in this title, or

(2) the effective date of laws enacted by the

legislature of such State implementing such

provisions,

but in no event later than the first day of the

first calendar quarter beginning after the

close of the first regular session of the State

legislature that begins after the date of enactment of this Act. For purposes of the previous sentence, in the case of a State that

has a 2-year legislative session, each year of

such session shall be deemed to be a separate

regular session of the State legislature.

(c) GRACE PERIOD FOR STATE CONSTITUTIONAL AMENDMENT.—A State shall not be

found out of compliance with any requirement enacted by this title if it is unable to

comply without amending the State constitution until the earlier of—

(1) the date one year after the effective

date of the necessary State constitutional

amendment, or

(2) the date five years after enactment of

this title.

SEC. 492. SEVERABILITY.

If any provision of this title or the application thereof to any person or circumstance is

held invalid, the invalidity shall not affect

other provisions or applications of this title

which can be given effect without regard to

the invalid provision or application, and to

this end the provisions of this title shall be

severable.

TITLE V—TEEN PREGNANCY AND FAMILY

STABILITY

Subtitle A—Federal Role

SEC. 501. STATE OPTION TO DENY AFDC FOR ADDITIONAL CHILDREN.

(a) IN GENERAL.—Section 402(a) (42 U.S.C.

602(a)), as amended by sections 101, 102,

211(a), 232, and 301(a) of this Act, is

amended—
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(1) by striking ‘‘and’’ at the end of paragraph (49);

(2) by striking the period at the end of

paragraph (50) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (50) the following:

‘‘(51) at the option of the State, provide

that—

‘‘(A)(i) notwithstanding paragraph (7)(A),

the needs of a child will not be taken into account in making the determination under

paragraph (7) with respect to the family of

the child if the child was born (other than as

a result of rape or incest) to a member of the

family—

‘‘(I) while the family was a recipient of aid

under the State plan; or

‘‘(II) during the 6-month period ending

with the date the family applied for such aid;

and

‘‘(ii) if the amount of aid payable to a family under the State plan is reduced by reason

of subparagraph (A), each member of the

family shall be considered to be receiving

such aid for purposes of eligibility for medical assistance under the State plan approved under title XIX for so long as such

aid would otherwise not be so reduced; and

‘‘(B) if the State exercises the option, the

State may provide the family with vouchers,

in amounts not exceeding the amount of any

such reduction in aid, that may be used only

to pay for particular goods and services specified by the State as suitable for the care of

the child of the parent (such as diapers,

clothing, or school supplies).’’.

(b) APPLICABILITY.—The amendments made

by subsection (a) shall apply to payments

under a State plan approved under part A of

title IV of the Social Security Act for

months beginning after the date of the enactment of this Act, and to payments to

States under such part for quarters beginning after such date.

SEC. 502. MINORS RECEIVING AFDC REQUIRED

TO LIVE UNDER RESPONSIBLE

ADULT SUPERVISION.

Section 402(a)(43) (42 U.S.C. 602(a)(43)) is

amended by striking ‘‘at the option of the

State,’’.

SEC. 503. NATIONAL CLEARINGHOUSE ON ADOLESCENT PREGNANCY.

(a) IN GENERAL.—Title XX (42 U.S.C. 1397–

1397f), as amended by section 222(b) of this

Act, is amended by adding at the end the following:

‘‘SEC. 2010. NATIONAL CLEARINGHOUSE ON ADOLESCENT PREGNANCY.

‘‘(a) NATIONAL CLEARINGHOUSE ON ADOLESCENT PREGNANCY.—

‘‘(1) ESTABLISHMENT.—The responsible Federal officials shall establish, through grant

or contract, a national center for the collection and provision of programmatic information and technical assistance that relates to

adolescent pregnancy prevention programs,

to be known as the ‘National Clearinghouse

on Adolescent Pregnancy Prevention Programs’.

‘‘(2) FUNCTIONS.—The national center established under paragraph (1) shall serve as a

national information and data clearinghouse, and as a training, technical assistance, and material development source for

adolescent pregnancy prevention programs.

Such center shall—

‘‘(A) develop and maintain a system for

disseminating information on all types of adolescent pregnancy prevention program and

on the state of adolescent pregnancy prevention program development, including information concerning the most effective model

programs;

‘‘(B) develop and sponsor a variety of training institutes and curricula for adolescent

pregnancy prevention program staff;

‘‘(C) identify model programs representing

the various types of adolescent pregnancy

prevention programs;

‘‘(D) develop technical assistance materials and activities to assist other entities in

establishing and improving adolescent pregnancy prevention programs;

‘‘(E) develop networks of adolescent pregnancy prevention programs for the purpose

of sharing and disseminating information;

and

‘‘(F) conduct such other activities as the

responsible Federal officials find will assist

in developing and carrying out programs or

activities to reduce adolescent pregnancy.

‘‘(b) FUNDING.—The responsible Federal officials shall make grants to eligible entities

for the establishment and operation of a National Clearinghouse on Adolescent Pregnancy Prevention Programs under subsection (a) so that in the aggregate the expenditures for such grants do not exceed

$2,000,000 for fiscal year 1996, $4,000,000 for fiscal year 1997, $8,000,000 for fiscal year 1998,

and $10,000,000 for fiscal year 1999 and each

subsequent fiscal year.

‘‘(c) DEFINITIONS.—As used in this section:

‘‘(1) ADOLESCENTS.—The term ‘adolescents’

means youth who are ages 10 through 19.

‘‘(2) ELIGIBLE ENTITY.—The term ‘eligible

entity’ means a partnership that includes—

‘‘(A) a local education agency, acting on

behalf of one or more schools, together with

‘‘(B) one or more community-based organizations, institutions of higher education, or

public or private agencies or organizations.

‘‘(3) ELIGIBLE AREA.—The term ‘eligible

area’ means a school attendance area in

which—

‘‘(A) at least 75 percent of the children are

from low-income families as that term is

used in part A of title I of the Elementary

and Secondary Education Act of 1965; or

‘‘(B) the number of children receiving Aid

to Families with Dependent Children under

part A of title IV is substantial as determined by the responsible Federal officials; or

‘‘(C) the unmarried adolescent birth rate is

high, as determined by the responsible Federal officials.

‘‘(4) SCHOOL.—The term ‘school’ means a

public elementary, middle, or secondary

school.

‘‘(5) RESPONSIBLE FEDERAL OFFICIALS.—The

term ‘responsible Federal officials’ means

the Secretary of Education, the Secretary of

Health and Human Services, and the Chief

Executive Officer of the Corporation for National and Community Service.’’.

(b) EFFECTIVE DATE.—The amendment

made by this section shall become effective

October 1, 1994.

SEC. 504. INCENTIVE FOR TEEN PARENTS TO ATTEND SCHOOL.

Section 402(a) (42 U.S.C. 602(a)), as amended

by sections 101, 102, 211(a), 232, 301(a), and

501(a) of this Act, is amended—

(1) by striking ‘‘and’’ at the end of paragraph (50);

(2) by striking the period at the end of

paragraph (51) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (51) the following:

‘‘(52) provide that the amount of aid otherwise payable under the plan for a month to

a family that includes a parent who has not

attained 20 years of age and has not completed secondary school (or received a certificate of high school equivalency) may be

reduced by 25 percent if, during the immediately preceding month, the parent has

failed without good cause (as defined by the

State in consultation with the Secretary) to

maintain minimum attendance (as defined

by the State in consultation with the Secretary) at an educational institution.’’.

SEC. 505. STATE OPTION TO DISREGARD 100–

HOUR RULE UNDER AFDC–UP PROGRAM.

Section 407(a) (42 U.S.C. 607(a)) is

amended—

(1) by inserting ‘‘(1)’’ after ‘‘(a)’’; and

(2) by adding at the end the following:

‘‘(2) A standard prescribed pursuant to

paragraph (1) that imposes a limit on the

amount of time during which a parent who is

the principal earner in a family in which

both parents are married may be employed

during a month shall not apply to a State if

the State plan under this part explicitly provides for such inapplicability.’’.

SEC. 506. STATE OPTION TO DISREGARD 6–

MONTH LIMITATION ON AFDC–UP

BENEFITS.

Section 407(b)(2)(B) (42 U.S.C. 607(b)(2)(B))

is amended by adding at the end the following:

‘‘(iv) A regulation prescribed by the Secretary that limits the length of time with respect to which a family of a dependent child

in which both parents are married may receive aid to families with dependent children

by reason of this section shall not apply to a

State if the State plan under this part explicitly provides for such inapplicability.’’.

SEC. 507. ELIMINATION OF QUARTERS OF COVERAGE REQUIREMENT UNDER

AFDC–UP PROGRAM FOR FAMILIES

IN WHICH BOTH PARENTS ARE

TEENS.

Section 407(b)(1)(A)(iii) (42 U.S.C.

607(b)(1)(A)(iii)) is amended by striking

‘‘(iii)(I)’’ and inserting ‘‘(iii) neither of the

child’s parents have attained 20 years of age,

and (I)’’.

SEC. 508. DENIAL OF FEDERAL HOUSING BENEFITS TO MINORS WHO BEAR CHILDREN OUT-OF-WEDLOCK.

(a) PROHIBITION OF ASSISTANCE.—Notwithstanding any other provision of law, a household whose head of household is an individual who has borne a child out-of-wedlock

before attaining 18 years of age may not be

provided Federal housing assistance for a

dwelling unit until attaining such age,

unless—

(1) after the birth of the child—

(A) the individual marries an individual

who has been determined by the relevant

State to be the biological father of the child;

or

(B) the biological parent of the child has

legal custody of the child and marries an individual who legally adopts the child;

(2) the individual is a biological and custodial parent of another child who was not

born out-of-wedlock; or

(3) eligibility for such Federal housing assistance is based in whole or in part on any

disability or handicap of a member of the

household.

(b) DEFINITIONS.—For purposes of this section, the following definitions shall apply:

(1) COVERED PROGRAM.—The term ‘‘covered

program’’ means—

(A) the program of rental assistance on behalf of low-income families provided under

section 8 of the United States Housing Act of

1937 (42 U.S.C. 1437f);

(B) the public housing program under title

I of the United States Housing Act of 1937 (42

U.S.C. 1437 et seq.);

(C) the program of rent supplement payments on behalf of qualified tenants pursuant to contracts entered into under section

101 of the Housing and Urban Development

Act of 1965 (12 U.S.C. 1701s);

(D) the program of interest reduction payments pursuant to contracts entered into by

the Secretary of Housing and Urban Development under section 236 of the National Housing Act (12 U.S.C. 1715z–1);

(E) the program for mortgage insurance

provided pursuant to sections 221(d) (3) or (4)

of the National Housing Act (12 U.S.C.

1715l(d)) for multifamily housing for low- and

moderate-income families;

(F) the rural housing loan program under

section 502 of the Housing Act of 1949 (42

U.S.C. 1472);
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1995 T49.12

(G) the rural housing loan guarantee program under section 502(h) of the Housing Act

of 1949 (42 U.S.C. 1472(h));

(H) the loan and grant programs under section 504 of the Housing Act of 1949 (42 U.S.C.

1474) for repairs and improvements to rural

dwellings;

(I) the program of loans for rental and cooperative rural housing under section 515 of

the Housing Act of 1949 (42 U.S.C. 1485);

(J) the program of rental assistance payments pursuant to contracts entered into

under section 521(a)(2)(A) of the Housing Act

of 1949 (42 U.S.C. 1490a(a)(2)(A));

(K) the loan and assistance programs under

sections 514 and 516 of the Housing Act of

1949 (42 U.S.C. 1484, 1486) for housing for farm

labor;

(L) the program of grants and loans for

mutual and self-help housing and technical

assistance under section 523 of the Housing

Act of 1949 (42 U.S.C. 1490c);

(M) the program of grants for preservation

and rehabilitation of housing under section

533 of the Housing Act of 1949 (42 U.S.C.

1490m); and

(N) the program of site loans under section

524 of the Housing Act of 1949 (42 U.S.C.

1490d).

(2) COVERED PROJECT.—The term ‘‘covered

project’’ means any housing for which Federal housing assistance is provided that is

attached to the project or specific dwelling

units in the project.

(3) FEDERAL HOUSING ASSISTANCE.—The

term ‘‘Federal housing assistance’’ means—

(A) assistance provided under a covered

program in the form of any contract, grant,

loan, subsidy, cooperative agreement, loan

or mortgage guarantee or insurance, or other

financial assistance; or

(B) occupancy in a dwelling unit that is—

(i) provided assistance under a covered program; or

(ii) located in a covered project and subject

to occupancy limitations under a covered

program that are based on income.

(4) STATE.—The term ‘‘State’’ means the

States of the United States, the District of

Columbia, the Commonwealth of Puerto

Rico, the Commonwealth of the Northern

Mariana Islands, Guam, the Virgin Islands,

American Samoa, and any other territory or

possession of the United States.

(c) LIMITATIONS ON APPLICABILITY.—Subsection (a) shall not apply to Federal housing assistance provided for a household pursuant to an application or request for such

assistance made by such household before

the effective date of this Act if the household

was receiving such assistance on the effective date of this Act.

SEC. 509. STATE OPTION TO DENY AFDC TO

MINOR PARENTS.

(a) IN GENERAL.—Section 402(a) (42 U.S.C.

602(a)), as amended by sections 101, 102,

211(a), 232, 301(a), 501(a), and 504 of this Act,

is amended—

(1) by striking ‘‘and’’ at the end of paragraph (51);

(2) by striking the period at the end of

paragraph (52) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (52) the following:

‘‘(53)(A) at the option of the State, provide

that—

‘‘(i) in making the determination under

paragraph (7) with respect to a family, the

State may disregard the needs of any family

member who is a parent and has not attained

18 years of age or such lesser age as the State

may prescribe; and

‘‘(ii) if the amount of aid payable to a family under the State plan is reduced by reason

of subparagraph (A), each member of the

family shall be considered to be receiving

such aid for purposes of eligibility for medical assistance under the State plan approved under title XIX for so long as such

aid would otherwise not be so reduced; and

‘‘(B) if the State exercises the option, the

State may provide the family with vouchers,

in amounts not exceeding the amount of any

such reduction in aid, that may be used only

to pay for—

‘‘(i) particular goods and services specified

by the State as suitable for the care of the

child of the parent (such as diapers, clothing,

or cribs); and

‘‘(ii) the costs associated with a maternity

home, foster home, or other adult-supervised

supportive living arrangement in which the

parent and the child live.’’.

(b) APPLICABILITY.—The amendments made

by subsection (a) shall apply to payments

under a State plan approved under part A of

title IV of the Social Security Act for

months beginning on or after January 1, 1998,

and to payments to States under such part

for quarters beginning after such date.

Subtitle B—State Role

SEC. 511. TEENAGE PREGNANCY PREVENTION

AND FAMILY STABILITY.

(a) FINDINGS.—The Congress finds that—

(1) long-term welfare dependency is increasing driven by illegitimate births;

(2) too many teens are becoming parents

and too few are able to responsibly care for

and nurture their children;

(3) new research has shown that spending

time in a single-parent family puts children

at substantially increased risk of dropping

out of high school, having a child out-of-wedlock, or being neither in school nor at work;

and

(4) between 1986 and 1991, the rate of births

to teens aged 15 to 19 rose 24 percent, from

50.2 to 62.1 births per 1,000 females.

(b) SENSE OF THE CONGRESS.—It is the sense

of the Congress that—

(1) children should be educated about the

risks involved in choosing parenthood at an

early age;

(2) reproductive family planning and education should be made available to every potential parent so as to give such parents the

opportunity to avoid unintended births;

(3) States should use funds provided under

title XX of the Social Security Act to provide comprehensive services to youth in high

risk neighborhoods, through community organizations, churches, and schools; and

(4) States should work with schools for the

early identification and referral of children

at risk for parenthood at an early age.

SEC. 512. AVAILABILITY OF FAMILY PLANNING

SERVICES.

Section 402(a)(15)(A) (42 U.S.C.

602(a)(15)(A)) is amended by striking ‘‘out of

wedlock’’.

TITLE VI—PROGRAM SIMPLIFICATION

Subtitle A—Increased State Flexibility

SEC. 601. STATE OPTION TO PROVIDE AFDC

THROUGH ELECTRONIC BENEFIT

TRANSFER SYSTEMS.

Section 402(a) (42 U.S.C. 602(a)), as amended

by sections 101, 102, 211(a), 232, 301(a), 501(a),

504, and 509(a) of this Act, is amended—

(1) by striking ‘‘and’’ at the end of paragraph (52);

(2) by striking the period at the end of

paragraph (53) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (53) the following:

‘‘(54) at the option of the State, provide for

the payment of aid under the State plan

through the use of electronic benefit transfer

systems.’’.

SEC. 602. DEADLINE FOR ACTION ON APPLICATION FOR WAIVER OF REQUIREMENT APPLICABLE TO PROGRAM OF

AID TO FAMILIES WITH DEPENDENT

CHILDREN.

Section 1115 (42 U.S.C. 1315) is amended by

adding at the end the following:

‘‘(e) The Secretary shall approve or deny

an application for a waiver under this section with respect to a requirement of section

402, not later than 90 days after the Secretary receives the application, unless otherwise agreed upon by the Secretary and the

applicant.’’.

Subtitle B—Coordination of AFDC and Food

Stamp Programs

SEC. 611. AMENDMENTS TO PART A OF TITLE IV

OF THE SOCIAL SECURITY ACT.

(a) STATE OPTION TO USE INCOME AND ELIGIBILITY VERIFICATION SYSTEM.—Section

1137(b) (42 U.S.C. 1320b–7(b)) is amended—

(1) by striking paragraphs (1) and (4), and

redesignating paragraphs (2), (3), and (5) as

paragraphs (1), (2), and (3), respectively; and

(2) in paragraph (2) (as so redesignated), by

adding ‘‘or’’ at the end.

(b) STATE OPTION TO USE RETROSPECTIVE

BUDGETING WITHOUT MONTHLY REPORTING.—

Section 402(a)(13) (42 U.S.C. 602(a)(13)) is

amended—

(1) by striking all that precedes subparagraph (A) and inserting the following:

‘‘(13) provide, at the option of the State

and with respect to such category or categories as the State may select and identify

in the State plan, that—’’; and

(2) in each of subparagraphs (A) and (B), by

striking ‘‘, in the case of families who are required to report monthly to the State agency pursuant to paragraph (14)’’.

(c) EXCLUSION FROM INCOME OF ALL INCOME

OF DEPENDENT CHILD WHO IS A STUDENT.—

Section 402(a)(8)(A)(i) (42 U.S.C.

602(a)(8)(A)(i)) is amended—

(1) by striking ‘‘earned’’; and

(2) by inserting ‘‘applying for or’’ before

‘‘receiving’’.

(d) EXCLUSION FROM INCOME OF CERTAIN ENERGY ASSISTANCE PAYMENTS BASED ON

NEED.—

(1) IN GENERAL.—Section 402(a)(8)(A) (42

U.S.C. 602(a)(8)(A)), as amended by sections

231 and 242(b)(1) of this Act, is amended—

(A) by striking ‘‘and’’ at the end of clause

(ix); and

(B) by adding at the end the following:

‘‘(xi) shall disregard any energy or utilitycost assistance payment based on need, that

is paid to any member of the family under—

‘‘(I) a State or local general assistance program; or

‘‘(II) another basic assistance program

comparable to general assistance (as determined by the Secretary); and’’.

(2) INCLUSION OF ENERGY ASSISTANCE PROVIDED UNDER THE LIHEAP PROGRAM.—Section

402(a)(8)(B) (42 U.S.C. 602(a)(8)(B)) is

amended—

(A) by striking ‘‘and’’ at the end of clause

(i); and

(B) by adding at the end the following:

‘‘(iii) shall not disregard any assistance

provided directly to, or indirectly for the

benefit of, any person described in subparagraph (A)(ii) under the Low-Income Home

Energy Assistance Act of 1981, notwithstanding section 2605(f)(1) of such Act; and’’.

(e) APPLICABILITY TO AFDC OF FUTURE INCOME EXCLUSIONS UNDER FOOD STAMP PROGRAM.—Section 402(a)(8)(A) (42 U.S.C.

602(a)(8)(A)), as amended by sections 231,

242(b)(1) of this Act and by subsection (d)(1)

of this section, is amended—

(1) by striking ‘‘and’’ at the end of clause

(x); and

(2) by adding at the end the following:

‘‘(xii) shall disregard from the income of

any child, relative, or other individual described in clause (ii) applying for aid under

the State plan, any child, relative, or other

individual so described receiving such aid, or

both, any funds that a Federal statute (enacted after the date of the enactment of this

clause) excludes from income for purposes of

determining eligibility for benefits under the

food stamp program under the Food Stamp

Act of 1977, the level of benefits under the

program, or both, respectively.’’.
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(f) PERIODIC REVIEWS.—Section 402(a) (42

U.S.C. 602(a)), as amended by sections 101,

102, 211(a), 232, 301(a), 501(a), 504, 509(a), and

601 of this Act, is amended—

(1) by striking ‘‘and’’ at the end of paragraph (53);

(2) by striking the period at the end of

paragraph (54) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (54) the following:

‘‘(55) provide that the State shall, not less

frequently than annually review each determination made under the State plan with respect to the eligibility of each recipient of

aid under the State plan;’’.

(g) EXCLUSION FROM RESOURCES OF ESSENTIAL EMPLOYMENT-RELATED PROPERTY.—

Section 402(a)(7)(B) (42 U.S.C. 602(a)(7)(B)), as

amended by section 242(a) of this Act, is

amended—

(1) by striking ‘‘or’’ at the end of clause

(iv); and

(2) by inserting ‘‘, or (vi) the value of real

and tangible personal property (other than

currency, commercial paper, and similar

property) of a family member that is essential to the employment or self-employment

of the member, until the expiration of the 1-

year period beginning on the date the member ceases to be so employed or so self-employed’’ before the semicolon.

(h) EXCLUSION FROM RESOURCES OF EQUITY

IN CERTAIN INCOME-PRODUCING REAL PROPERTY.—Section 402(a)(7)(B) (42 U.S.C.

602(a)(7)(B)), as amended by section 242(a) of

this Act and by subsection (g) of this section,

is amended—

(1) by striking ‘‘or’’ at the end of clause

(v); and

(2) by inserting ‘‘, or (vii) the equity of any

member of the family in real property to

which 1 or more members of the family have

sole and clear title, that the State agency

determines is producing income consistent

with the fair market value of the property’’

before the semicolon.

(i) EXCLUSION FROM RESOURCES OF LIFE INSURANCE POLICIES.—Section 402(a)(7)(B) (42

U.S.C. 602(a)(7)(B)), as amended by section

242(a) of this Act and by subsections (g) and

(h) of this section, is amended—

(1) by striking ‘‘or’’ at the end of clause

(vi); and

(2) by inserting ‘‘, or (viii) any life insurance policy’’ before the semicolon.

(j) EXCLUSION FROM RESOURCES OF REAL

PROPERTY THAT THE FAMILY IS MAKING A

GOOD FAITH EFFORT TO SELL.—Section

402(a)(7)(B)(iii) (42 U.S.C. 602(a)(7)(B)(iii)) is

amended—

(1) by striking ‘‘for such period or periods

of time as the Secretary may prescribe’’; and

(2) by striking ‘‘any such period’’ and inserting ‘‘any period during which the family

is making such an effort’’.

(k) PROMPT RESTORATION OF BENEFITS

WRONGFULLY DENIED.—Section 402(a) (42

U.S.C. 602(a)), as amended by sections 101,

102, 211(a), 232, 301(a), 501(a), 504, 509(a), and

601 of this Act and by subsection (f) of this

section, is amended—

(1) by striking ‘‘and’’ at the end of paragraph (54);

(2) by striking the period at the end of

paragraph (55) and inserting ‘‘; and’’; and

(3) by inserting after paragraph (55) the following:

‘‘(56) provide that, upon receipt of a request from a family for the payment of any

amount of aid under the State plan the payment of which to the family has been wrongfully denied or terminated, the State shall

promptly pay the amount to the family if

the wrongful denial or termination occurred

not more than 1 year before the date of the

request or the date the State agency is notified or otherwise discovers the wrongful denial or termination.’’.

SEC. 612. AMENDMENTS TO THE FOOD STAMP

ACT OF 1977.

(a) CERTIFICATION PERIOD.—(1) Section 3(c)

of the Food Stamp Act of 1977 (7 U.S.C.

2012(c)) is amended to read as follows:

‘‘(c) ‘Certification period’ means the period

specified by the State agency for which

households shall be eligible to receive authorization cards, except that such period

shall be—

‘‘(1) 24 months for households in which all

adult members are elderly or disabled; and

‘‘(2) not more than 12 months for all other

households.’’.

(2) Section 6(c)(1)(C) of the Food Stamp

Act of 1977 (7 U.S.C. 2015(c)(1)(C)) is

amended—

(A) in clause (ii) by adding ‘‘and’’ at the

end;

(B) in clause (iii) by striking ‘‘; and’’ at the

end and inserting a period; and

(C) by striking clause (iv).

(b) INCLUSION OF ENERGY ASSISTANCE IN INCOME.—

(1) AMENDMENTS TO THE FOOD STAMP ACT

OF 1977.—Section 5 of the Food Stamp Act of

1977 (7 U.S.C. 2014) is amended—

(A) in subsection (d)—

(i) by striking paragraph (11); and

(ii) by redesignating paragraphs (12)

through (16) as paragraphs (11) through (15),

respectively; and

(B) in subsection (k)—

(i) in paragraph (1)(B) by striking ‘‘, not including energy or utility-cost assistance,’’;

and

(ii) in paragraph (2)—

(I) by striking subparagraph (C); and

(II) by redesignating subparagraphs (D)

through (H) as subparagraphs (C) through

(J), respectively.

(2) AMENDMENTS TO THE LOW-INCOME HOME

ENERGY ASSISTANCE ACT OF 1981.—Section

2605(f) of the Low-Income Home Energy Assistance Act of 1981 (42 U.S.C. 8624(f)) is

amended—

(A) in paragraph (1) by striking ‘‘food

stamps,’’; and

(B) by amending paragraph (2) to read as

follows:

‘‘(2) Paragraph (1) shall not apply for any

purpose under the Food Stamp Act of 1977.’’.

(c) EXCLUSION OF CERTAIN JTPA INCOME.—

Section 5(d) of the Food Stamp Act of 1977 (7

U.S.C. 2014(d)), as amended by subsection (b),

is amended—

(1) by striking ‘‘and (15)’’ and inserting

‘‘(15)’’; and

(2) by inserting before the period the following:

‘‘, and (16) income received under the Job

Training Partnership Act by a household

member who is less than 19 years of age’’.

(d) EXCLUSION OF EDUCATIONAL ASSISTANCE

FROM INCOME.—Section 5(d) of the Food

Stamp Act of 1977 (7 U.S.C. 2014(d)) is

amended—

(1) by amending paragraph (3) to read as

follows: ‘‘(3) all educational loans on which

payment is deferred (including any loan

origination fees or insurance premiums associated with such loans), grants, scholarships,

fellowships, veterans’ educational benefits,

and the like awarded to a household member

enrolled at a recognized institution of postsecondary education, at a school for the

handicapped, in a vocational education program, or in a program that provides for completion of a secondary school diploma or obtaining the equivalent thereof,’’; and

(2) in paragraph (5) by striking ‘‘and no

portion’’ and all that follows through ‘‘reimbursement’’.

(e) LIMITATION ON ADDITIONAL EARNED INCOME DEDUCTION.—The 3rd sentence of section 5(e) of the Food Stamp Act of 1977 (7

U.S.C. 2014(e)) is amended by striking

‘‘earned income that’’ and all that follows

through ‘‘report’’, and inserting ‘‘determining an overissuance due to the failure of

a household to report earned income’’.

(f) EXCLUSION OF ESSENTIAL EMPLOYMENTRELATED PROPERTY.—Section 5(g)(3) of the

Food Stamp Act of 1977 (7 U.S.C. 2014(g)(3)) is

amended to read as follows:

‘‘(3) The value of real and tangible personal

property (other than currency, commercial

paper, and similar property) of a household

member that is essential to the employment

or self-employment of such member shall be

excluded by the Secretary from financial resources until the expiration of the 1-year period beginning on the date such member

ceases to be so employed or so self-employed.’’.

(g) EXCLUSION OF LIFE INSURANCE POLICIES.—Section 5(g) of the Food Stamp Act of

1977 (7 U.S.C. 2014(g)) is amended by adding

at the end the following:

‘‘(6) The Secretary shall exclude from financial resources the cash value of any life

insurance policy owned by a member of a

household.’’.

(h) IN-TANDEM EXCLUSIONS FROM INCOME.—

Section 5 of the Food Stamp Act of 1977 (7

U.S.C. 2014) is amended by adding at the end

the following:

‘‘(n) Whenever a Federal statute enacted

after the date of the enactment of this Act

excludes funds from income for purposes of

determining eligibility, benefit levels, or

both under State plans approved under part

A of title IV of the Social Security Act, then

such funds shall be excluded from income for

purposes of determining eligibility, benefit

levels, or both, respectively, under the food

stamp program of households all of whose

members receive benefits under a State plan

approved under part A of title IV of the Social Security Act.’’.

(i) APPLICATION OF AMENDMENTS.—The

amendments made by this section shall not

apply with respect to certification periods

beginning before the effective date of this

section.

Subtitle C—Fraud Reduction

SEC. 631. SENSE OF THE CONGRESS IN SUPPORT

OF THE EFFORTS OF THE ADMINISTRATION TO ADDRESS THE PROBLEMS OF FRAUD AND ABUSE IN THE

SUPPLEMENTAL SECURITY INCOME

PROGRAM.

The Congress hereby expresses support for

the efforts of the Social Security Administration to reduce fraud and abuse in the supplemental security income program under

title XVI of the Social Security Act by implementing a structured approach to disability decisionmaking that takes into consideration the large number of disability

claims received while providing a basis for

consistent, equitable decisionmaking by

claims adjudicators at each level, that provides for the following:

(1) A simplification of the monetary guidelines for determining whether an individual

(except those filing for benefits based on

blindness) is engaging in substantial gainful

activity.

(2) The replacement of a threshold severity

requirement for determining whether a

claimant has a medically determinable impairment with a threshold inquiry as to

whether the claimant has a medically determinable physical or mental impairment that

can be demonstrated by acceptable clinical

and laboratory diagnostic techniques.

(3) The comparison of an impairment referred to in paragraph (2) with an index of

disabling impairments that contains fewer

impairments, has less detail and complexity,

and does not rely on the concept of ‘‘medical

equivalence’’.

(4)(A) The consideration of whether an individual has the ability to perform substantial gainful activity despite any functional

loss caused by a medically determinable

physical or mental impairment.
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1995 T49.12

(B) The definition of the physical and mental requirements of substantial gainful activity.

(C) The objective measurement, to the extent possible, of whether an individual meets

such requirements.

(D) The development, with the assistance

of the medical community and other outside

experts from disability programs, of standardized criteria which can be used to measure an individual’s functional ability.

(E) The assumption by the Social Security

Administration of primary responsibility for

documenting functional ability using the

standardized measurement criteria, with the

goal of developing functional assessment instruments that are standardized, accurately

measure an individual’s functional abilities,

and are universally accepted by the public,

the advocacy community, and health care

professionals.

(F) The use of the results of the standardized functional measurement with a new

standard to describe basic physical and mental demands of a baseline of work that represents substantial gainful activity and that

exists in significant numbers in the national

economy.

(5)(A) An evaluation of whether a child is

engaging in substantial gainful activity,

whether a child has a medically determinable physical or mental impairment that

will meet the duration requirement, and

whether a child has an impairment that

meets the criteria in the index of disabling

impairments.

(B) The development, with the assistance

of the medical community and educational

experts, of standardized criteria which can

be used to measure a child’s functional ability to perform a baseline of functions that

are comparable to the baseline of occupational demands for an adult.

(C) The conduct of research to specifically

identify a skill acquisition threshold to

measure broad areas required to develop the

ability to perform substantial gainful activity.

SEC. 632. STUDY ON FEASIBILITY OF SINGLE

TAMPER-PROOF IDENTIFICATION

CARD TO SERVE PROGRAMS UNDER

BOTH THE SOCIAL SECURITY ACT

AND HEALTH REFORM LEGISLATION.

(a) STUDY.—As soon as practicable after

the date of the enactment of this Act, the

Commissioner of Social Security shall conduct a study of the feasibility of issuing, in

counterfeit-resistant form, a single identification card which would combine the features of the social security card now issued

pursuant to section 205 of the Social Security Act and any health security card which

may be provided for in health reform legislation enacted in the 104th Congress. In such

study, the Commissioner shall devote particular consideration to—

(1) employment in such card of finger-print

identification, bar code validation, a photograph, a hologram, or any other identifiable

feature,

(2) the efficiencies and economies which

may be achieved by combining the features

of the social security card as currently

issued and the features of any health security card which might be issued under health

reform legislation, and

(3) any costs and risks which might result

from combining such features in a single

identification card and possible means of alleviating any such costs and risks.

(b) REPORT.—The Commissioner of Social

Security shall, not later than 1 year after

the date of the enactment of this Act, transmit a report to each House of the Congress

setting forth the Commissioner’s findings

from the study conducted pursuant to subsection (a). Such report may include such

recommendations for administrative or legislative changes as the Commissioner considers appropriate.

Subtitle D—Additional Provisions

SEC. 641. STATE OPTIONS REGARDING UNEMPLOYED PARENT PROGRAM.

(a) DURATION OF UNEMPLOYMENT AND

RECENCY-OF-WORK TESTS.—Section

407(b)(1)(A) (42 U.S.C. 607(b)(1)(A)), as amended by section 507 of this Act, is amended—

(1) by striking the matter preceding clause

(i) and inserting the following:

‘‘(A) subject to paragraph (2), shall provide

for the payment of aid to families with dependent children with respect to a dependent

child within the meaning of subsection (a)—

’’.

(2) in clause (i), by striking ‘‘whichever’’

and inserting ‘‘when, if the State chooses to

so require (and specifies in its State plan),

whichever’’;

(3) in clause (ii), by inserting ‘‘when’’ before such parent; and

(4) in clause (iii), by inserting ‘‘when, if the

State chooses to so require (and so specifies

in its State plan)’’ after ‘‘(iii)’’.

(b) STATE OPTION TO EXPAND PROGRAM.—

Section 407(a) (42 U.S.C. 607(a)) is amended

by inserting ‘‘or the unemployment (as defined (if at all) by the State in the State plan

approved under section 402)’’ before ‘‘of the

parent’’.

(c) EFFECTIVE DATE.—Subsection (b) and

the amendments made by subsection (a)

shall become effective October 1, 1996.

SEC. 642. DEFINITION OF ESSENTIAL PERSON.

(a) GENERAL REQUIREMENT.—Section 402 (42

U.S.C. 602), as amended by section

222(a)(1)(A) of this Act, is amended by inserting after subsection (f) the following:

‘‘(g) In order that the State may include

the needs of an individual in determining the

needs of the dependent child and relative

with whom the child is living, such individual must be living in the same home as

such child and relative, and—

‘‘(1) furnishing personal services required

because of the relative’s physical or mental

inability to provide care necessary for herself or himself or for the dependent child

(which, for purposes of this subsection only,

includes a child receiving supplemental security income benefits under title XVI); or

‘‘(2) furnishing child care services, or care

for an incapacitated member of the family,

that is necessary to permit the caretaker

relative—

‘‘(A) to engage in full or part-time employment outside the home, or

‘‘(B) to attend a course of education designed to lead to a high school diploma (or

its equivalent) or a course of training on a

full or part-time basis, or to participate in

the program under part G on a full or parttime basis.’’.

SEC. 643. ‘‘FILL-THE-GAP’’ BUDGETING.

(a) IN GENERAL.—Section 402(a)(8)(A) (42

U.S.C. 602(a)(8)(A)), as amended by sections

231, 242(b)(1), and 611(d)(1) of this Act, is

amended—

(1) by striking ‘‘and’’ at the end of clause

(xi); and

(2) by adding at the end the following:

‘‘(xiii) in addition to any other amounts required or permitted by this paragraph to be

disregarded in a month, may exempt countable income identified in the State plan by

type or source and by amount, but in an

amount not exceeding the difference between

the State’s standard of need applicable to

the family and the amount from which all

remaining nonexempt income is subtracted

to determine the amount of aid payable

under the State plan to a family of the same

size with no other income;’’.

(b) EFFECTIVE DATE.—The amendment

made by subsection (a) shall take effect on

October 1, 1997.

SEC. 644. REPEAL OF REQUIREMENT TO MAKE

CERTAIN SUPPLEMENTAL PAYMENTS IN STATES PAYING LESS

THAN THEIR NEEDS STANDARDS.

Section 402(a)(28) (42 U.S.C. 602(a)(28)) is

hereby repealed.

SEC. 645. COLLECTION OF AFDC OVERPAYMENTS

FROM FEDERAL TAX REFUNDS.

(a) AUTHORITY TO INTERCEPT TAX REFUND.—(1) Part A of title IV (42 U.S.C. 601–

617) is amended by adding at the end the following:

‘‘COLLECTION OF OVERPAYMENTS FROM

FEDERAL TAX REFUNDS

‘‘SEC. 418. (a) Upon receiving notice from a

State agency administering a plan approved

under this part that a named individual has

been overpaid under the State plan approved

under this part, the Secretary of the Treasury shall determine whether any amounts as

refunds of Federal taxes paid are payable to

such individual, regardless of whether such

individual filed a tax return as a married or

unmarried individual. If the Secretary of the

Treasury finds that any such amount is payable, he shall withhold from such refunds an

amount equal to the overpayment sought to

be collected by the State and pay such

amount to the State agency.

‘‘(b) The Secretary of the Treasury shall

issue regulations, approved by the Secretary

of Health and Human Services, that

provide—

‘‘(1) that a State may only submit under

subsection (a) requests for collection of overpayments with respect to individuals (A)

who are no longer receiving aid under the

State plan approved under this part, (B) with

respect to whom the State has already taken

appropriate action under State law against

the income or resources of the individuals or

families involved as required under section

402(a)(22) (B), and (C) to whom the State

agency has given notice of its intent to request withholding by the Secretary of the

Treasury from their income tax refunds;

‘‘(2) that the Secretary of the Treasury

will give a timely and appropriate notice to

any other person filing a joint return with

the individual whose refund is subject to

withholding under subsection (a); and

‘‘(3) the procedures that the State and the

Secretary of the Treasury will follow in carrying out this section which, to the maximum extent feasible and consistent with the

specific provisions of this section, will be the

same as those issued pursuant to section

464(b) applicable to collection of past-due

child support.’’.

(2) Section 6402 of the Internal Revenue

Code of 1986 (as amended by section 443(a) of

this Act) is amended—

(A) in subsection (a), by striking ‘‘(c) and

(d)’’ and inserting ‘‘(c), (d), and (e)’’;

(B) by redesignating subsections (e)

through (i) as subsections (f) through (j), respectively; and

(C) by inserting after subsection (d) the following:

‘‘(g) COLLECTION OF OVERPAYMENTS UNDER

TITLE IV–A OF THE SOCIAL SECURITY ACT.—

The amount of any overpayment to be refunded to the person making the overpayment shall be reduced (after reductions pursuant to subsections (c) and (d), but before a

credit against future liability for an internal

revenue tax) in accordance with section 418

of the Social Security Act (concerning recovery of overpayments to individuals under

State plans approved under part A of title IV

of such Act).’’.

(b) CONFORMING AMENDMENT.—Section

552a(a)(8)(B)(iv)(III) of title 5, United States

Code, is amended by striking ‘‘section 464 or

1137 of the Social Security Act’’ and inserting ‘‘section 419, 464, or 1137 of the Social Security Act.’’
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SEC. 646. TERRITORIES.

(a) IN GENERAL.—Section 1108(a) (42 U.S.C.

1308(a)) is amended by striking paragraphs

(1), (2), and (3) and inserting the following:

‘‘(1) for payment to Puerto Rico shall not

exceed—

‘‘(A) $82,000,000 with respect to fiscal years

1994, 1995, and 1996, and

‘‘(B) $102,500,000 or, if greater, such amount

adjusted by the CPI (as prescribed in subsection (f)) for fiscal year 1997 and each fiscal

year thereafter;

‘‘(2) for payment to the Virgin Islands shall

not exceed—

‘‘(A) $2,800,000 with respect to fiscal years

1994, 1995, and 1996, and

‘‘(B) $3,500,000 or, if greater, such amount

adjusted by the CPI (as prescribed in subsection (f)) for fiscal year 1997 and each fiscal

year thereafter; and

‘‘(3) for payment to Guam shall not

exceed—

‘‘(A) $3,800,000 with respect to fiscal year

1994, 1995, and 1996, and

‘‘(B) $4,750,000 or, if greater, such amount

adjusted by the CPI (as prescribed in subsection (f)), for fiscal year 1997 and each fiscal year thereafter.’’.

(b) CPI ADJUSTMENT.—Section 1108 (42

U.S.C. 1308) is amended by adding at the end

the following:

‘‘(f) For purposes of subsection (a), an

amount is ‘adjusted by the CPI’ for months

in calendar year by multiplying that amount

by the ratio of the Consumer Price Index as

prepared by the Department of Labor for—

‘‘(1) the third quarter of the preceding calendar year, to

‘‘(2) the third quarter of calendar year 1996,

and rounding the product, if not a multiple

of $10,000, to the nearer multiple of $10,000.’’.

SEC. 647. DISREGARD OF STUDENT INCOME.

(a) IN GENERAL.—Section 402(a)(8)(A)(i) (42

U.S.C. 602(a)(8)(A)(i)) is amended by striking

‘‘dependent child’’ and all that follows and

inserting ‘‘individual who has not attained 19

years of age and is an elementary or secondary school student’’.

(b) CONFORMING AMENDMENTS.—Section

402(a) (42 U.S.C. 602(a)) is amended—

(1) in paragraph (8)(A)(vii)—

(A) by striking ‘‘a dependent child who is a

full-time student’’ and inserting ‘‘an individual who has not attained 19 years of age

and is an elementary or secondary school

student’’; and

(B) by striking ‘‘such child’’ and inserting

‘‘such individual’’; and

(2) in paragraph (18), by striking ‘‘of a dependent child’’ and inserting ‘‘of an individual under age 19’’.

SEC. 648. LUMP-SUM INCOME.

Section 402(a)(8)(A) (42 U.S.C. 602(a)(8)(A)),

as amended by sections 231, 242(b)(1),

611(d)(1), and 643(a) of this Act, is amended—

(1) by striking ‘‘and’’ at the end of clause

(xii); and

(2) by adding at the end the following:

‘‘(xiv) shall disregard from the income of

any family member any amounts of income

received in the form of nonrecurring lumpsum payments other than payments made

pursuant to an order for child or spousal support being enforced by the agency administering the State plan approved under part

D;’’.

TITLE VII—CHILD PROTECTION BLOCK

GRANT PROGRAM

SEC. 701. ESTABLISHMENT OF PROGRAMS.

Part B of title IV (42 U.S.C. 620–635) is

amended to read as follows:

PART B—CHILD PROTECTION BLOCK

GRANT PROGRAM

‘‘SEC. 420. PURPOSES; AUTHORIZATIONS OF APPROPRIATIONS.

‘‘The purpose of this part is to enable

States to carry out a program of child welfare and child protection services which

includes—

‘‘(1) child protection services for children

who are, or are suspected of being or at risk

of becoming, victims of abuse or neglect;

‘‘(2) preventive services and activities, including community-based family support

services, designed to strengthen and preserve

families and to prevent child abuse and neglect; and

‘‘(3) permanency planning services and activities to achieve planned, permanent living

arrangements (including family reunification, adoption, and independent living) for

children who have been removed from their

families.

‘‘SEC. 421. STATE PLANS.

‘‘(a) IN GENERAL.—In order to be eligible

for payment under this part, a State must

have an approved plan (developed jointly by

the Secretary and the State agency, after

consultation with persons and entities specified in subsection (b)) for the provision of

services to children and families which meet

the requirements of subsection (c).

‘‘(b) CONSULTATION WITH APPROPRIATE ENTITIES.—A State, in developing its plan for

approval under this part, shall consult with

concerned persons and entities, including—

‘‘(1) public and nonprofit private agencies

and community-based organizations with experience in administering programs of child

welfare services for children and families;

and

‘‘(2) representatives of and advocates for

children and families.

‘‘(c) STATE PLAN REQUIREMENTS.—A State

plan under this part shall—

‘‘(1) describe the services and activities to

be performed, and the service delivery mechanisms (including service providers and

statewide distribution of services) to be used,

to provide—

‘‘(A) child protection services described in

section 420(1) (including such services provided under this part and part E);

‘‘(B) preventive services described in section 420(2) (and shall provide for delivery of

such services through a statewide network of

local nonprofit community-based family support programs, in collaboration with existing

health, mental health, education, employment, training, child welfare, and other social services agencies); and

‘‘(C) permanency planning services described in section 420(3) (including family reunification, adoption, and independent living);

‘‘(2)(A)(i) declare the State’s goals for accomplishments under the plan is in operation in the State, and (ii) be updated periodically to declare the State’s goals for accomplishments under the plan by the end of

each fifth fiscal year thereafter;

‘‘(B) describe the methods to be used in

measuring progress toward accomplishment

of the goals; and

‘‘(C) contain a commitment that the

State—

‘‘(i) will perform an interim review of its

progress toward accomplishment of the goals

after the end of each of the first 4 fiscal

years covered by the goals, and on the basis

of such interim review will revise the statement of goals in the plan, if necessary, to reflect changed circumstances or other relevant factors; and

‘‘(ii) will perform, after the end of the last

fiscal year covered by the goals, a final review of its progress toward accomplishment

of the goals and prepare a report to the Secretary on the basis of such final review;

‘‘(3) provide assurances that reasonable

amounts will be expended under this part to

carry out each of the purposes specified in

paragraphs (1) through (3) of section 420; and

‘‘(4) provide assurances that the State has

in effect a program of foster care safeguards

meeting the requirements of section 425.

‘‘(d) SECRETARIAL APPROVAL.—The Secretary shall approve a State plan that meets

the requirements of this section.

‘‘SEC. 422. RESERVATIONS; ALLOTMENTS TO

STATES.

‘‘(a) IN GENERAL.—The Secretary shall

allot the amount specified in subsection (b)

for each fiscal year in accordance with subsections (c) through (f).

‘‘(b) FEDERAL FUNDING.—The amount specified for purposes of this section shall be—

‘‘(1) $653,000,000 for fiscal year 1996;

‘‘(1) $682,000,000 for fiscal year 1997;

‘‘(1) $713,000,000 for fiscal year 1998;

‘‘(1) $737,000,000 for fiscal year 1999; and

‘‘(1) $763,000,000 for fiscal year 2000.

‘‘(c) PROJECTS OF NATIONAL SIGNIFICANCE.—

Two percent of the amount specified under

subsection (b) for each fiscal year shall be reserved for expenditure by the Secretary for

projects of national significance related to

the purposes of this part.

‘‘(d) TRAINING AND TECHNICAL ASSISTANCE.—Two percent of the amount specified

under subsection (b) for each fiscal year shall

be reserved for expenditure by the Secretary

for training and technical assistance to

State and local public and nonprofit private

entities related to the program under this

part.

‘‘(e) INDIAN TRIBES.—One percent of the

amount specified under subsection (b) for

each fiscal year shall be reserved for allotment to Indian tribes in accordance with section 424.

‘‘(f) STATES.—From the balance of the

amount specified for each fiscal year under

subsection (b) remaining after the application of subsections (c), (d), and (e), the Secretary shall allot to each State an amount

which bears the same ratio to the amount

specified as the total amount that would

have been allotted to the State for such fiscal year under this part, as in effect on September 30, 1995, bears to the total amount

that would have been so allotted to all

States for such fiscal year.

‘‘SEC. 423. PAYMENTS TO STATES.

‘‘(a) ENTITLEMENT TO PAYMENT; FEDERAL

SHARE OF COSTS.—Each State which has a

plan approved under this part shall be entitled to payment, equal to its allotment

under section 422 for a fiscal year, for use in

payment by the State of 75 percent of the

costs of activities under the State plan during such fiscal year. The remaining 25 percent of such costs shall be paid by the State

with funds from non-Federal sources.

‘‘(b) PAYMENT INSTALLMENTS.—The Secretary shall make payments in accordance

with section 6503 of title 31, United States

Code, to each State from its allotment for

use under this part.

‘‘SEC. 424. PAYMENTS TO INDIAN TRIBES.

‘‘(a) IN GENERAL.—The Secretary shall

make payments under this part for a fiscal

year directly to the tribal organization of an

Indian tribe with a plan approved under this

part, except that such plan need not meet

any requirement under such section that the

Secretary determines is inappropriate with

respect to such Indian tribe.

‘‘(b) ALLOTMENT.—From the amount reserved pursuant to section 422(e) for any fiscal year, the Secretary shall allot to each Indian tribe meeting the conditions specified

in subsection (a), an amount bearing the

same ratio to such reserved amount as the

number of children in all Indian tribes with

State plans so approved, as determined by

the Secretary on the basis of the most current and reliable information available to

the Secretary.

‘‘SEC. 425. FOSTER CARE PROTECTION.

‘‘In order to meet the requirements of this

section, for purposes of section 421(c)(4), a

State shall—

‘‘(1) since June 17, 1980, have completed an

inventory of all children who, before the in-
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1995 T49.12

ventory, had been in foster care under the responsibility of the State for 6 months or

more, which determined—

‘‘(A) the appropriateness of, and necessity

for, the foster care placement;

‘‘(B) whether the child could or should be

returned to the parents of the child or should

be freed for adoption or other permanent

placement; and

‘‘(C) the services necessary to facilitate

the return of the child or the placement of

the child for adoption or legal guardianship;

‘‘(2) be operating, to the satisfaction of the

Secretary—

‘‘(A) a statewide information system from

which can be readily determined the status,

demographic characteristics, location, and

goals for the placement of every child who is

(or, within the immediately preceding 12

months, has been) in foster care;

‘‘(B) a case review system (as defined in

section 475(5)) for each child receiving foster

care under the supervision of the State;

‘‘(C) a service program designed to help

children—

‘‘(i) where appropriate, return to families

from which they have been removed; or

‘‘(ii) be placed for adoption, with a legal

guardian, or, if adoption or legal guardianship is determined not to be appropriate for

a child, in some other planned, permanent

living arrangement; and

‘‘(D) a replacement preventive services

program designed to help children at risk of

foster care placement remain with their families; and

‘‘(3)(A) have reviewed (or by October 31,

1995 will have reviewed) State policies and

administrative and judicial procedures in effect for children abandoned at or shortly

after birth (including policies and procedures

providing for legal representation of such

children); and

‘‘(B) be implementing (or by October 31,

1996, will be implementing) such policies and

procedures as the State determines, on the

basis of the review described in clause (i), to

be necessary to enable permanent decisions

to be made expeditiously with respect to the

placement of such children.

SEC. 702. REPEALS AND CONFORMING AMENDMENTS.

(a) ABANDONED INFANTS ASSISTANCE.—

(1) REPEAL.—The Abandoned Infants Assistance Act of 1988 (42 U.S.C. 670 note) is repealed.

(2) CONFORMING AMENDMENT.—Section

421(7) of the Domestic Violence Service Act

of 1973 (42 U.S.C. 5061(7)) is amended to read

as follows:

‘‘(7) the term ‘boarder baby’ means an infant who is medically cleared for discharge

from an acute-care hospital setting, but remains hospitalized because of a lack of appropriate out-of-hospital placement alternatives.’’.

(b) CHILD ABUSE PREVENTION AND TREATMENT.—

(1) REPEAL.—The Child Abuse Prevention

and Treatment Act (42 U.S.C. 5101 et seq.) is

repealed.

(2) CONFORMING AMENDMENTS.—The Victims

of Crime Act of 1984 (42 U.S.C. 10601 et seq.)

is amended by striking section 1404A.

(c) ADOPTION OPPORTUNITIES.—The Child

Abuse Prevention and Treatment and Adoption Reform Act of 1978 (42 U.S.C. 5111 et

seq.) is repealed.

(d) FAMILY SUPPORT CENTERS.—Subtitle F

of title VII of the Stewart B. McKinney

Homeless Assistance Act (42 U.S.C. 11481–

11489) is repealed.

(e) FOSTER CARE.—Section 472(d) (42 U.S.C.

672(d)) is amended by striking ‘‘422(b)(9)’’ and

inserting ‘‘425’’.

SEC. 703. EFFECTIVE DATE.

The amendments and repeals made by this

title shall take effect on October 1, 1995, and

shall apply with respect to activities under

State programs on and after that date.

TITLE VIII—SSI REFORM

Subtitle A—Eligibility of Children for

Benefits

SEC. 801. RESTRICTIONS ON ELIGIBILITY.

(a) IN GENERAL.—Section 1614(a)(3)(A) (42

U.S.C. 1382c(a)(3)(A)) is amended—

(1) by inserting ‘‘(i)’’ after ‘‘(3)(A)’’;

(2) by inserting ‘‘who has attained 18 years

of age’’ before ‘‘shall be considered’’;

(3) by striking ‘‘he’’ and inserting ‘‘the individual’’;

(4) by striking ‘‘(or, in the case of an individual under the age of 18, if he suffers from

any medically determinable physical or mental impairment of comparable severity)’’;

and

(5) by adding after and below the end the

following:

‘‘(ii) An individual who has not attained 18

years of age shall be considered to be disabled for purposes of this title for a month if

the individual has any medically determinable physical or mental impairment (or

combination of impairments) that meets the

requirements, applicable to individuals who

have not attained 18 years of age, of the Listings of Impairments set forth in appendix 1

of subpart P of part 404 of title 20, Code of

Federal Regulations, or the individual has a

combination of impairments the effect of

which should be considered disabling for purposes of this title. In applying this clause,

such Listings shall not include maladaptive

behavior or psychoactive substance dependence disorder (as specified in the appendix

setting forth such Listings).’’.

(b) TRANSITION TO NEW ELIGIBILITY CRITERIA.—Within 3 months after the date of the

enactment of this Act, the Commissioner of

Social Security shall establish a functional

equivalency standard separate from the Listing of Impairments (set forth in appendix 1

of subpart P of part 404 of title 20, Code of

Federal Regulations (revised as of April 1,

1994)) under which a child with a combination of impairments should be considered

disabled for purposes of the supplemental security income program under title XVI of

the Social Security Act. Within 10 months

after the date of the enactment of this Act,

the Commissioner shall review the case of

each individual who, immediately before

such date of enactment, qualified for benefits under such program by reason of an individualized functional assessment in order to

determine eligibility under such Listings

and the criteria established under such

standard.

SEC. 802. CONTINUING DISABILITY REVIEWS FOR

CERTAIN CHILDREN.

Section 1614(a)(3)(G) (42 U.S.C.

1382c(a)(3)(G)) is amended—

(1) by inserting ‘‘(i)’’ after ‘‘(G)’’; and

(2) by adding at the end the following:

‘‘(ii)(I) Not less frequently than once every

3 years, the Commissioner shall redetermine

the eligibility for benefits under this title of

each individual who has not attained 18

years of age and is eligible for such benefits

by reason of disability.

‘‘(II) Subclause (I) shall not apply to an individual if the individual has an impairment

(or combination of impairments) which is (or

are) not expected to improve.

‘‘(III) Subject to recommendations made

by the Commissioner, parents or guardians

of recipients whose cases are reviewed under

this clause shall present, at the time of review, evidence demonstrating that funds provided under this title have been used to assist the recipient in improving the condition

which was the basis for providing benefits

under this title.’’.

SEC. 803. DISABILITY REVIEW REQUIRED FOR SSI

RECIPIENTS WHO ARE 18 YEARS OF

AGE.

(a) IN GENERAL.—Section 1614(a)(3)(G) (42

U.S.C. 1382c(a)(3)(G)), as amended by section

802 of this subtitle, is amended by adding at

the end the following:

‘‘(iii)(I) The Commissioner shall redetermine the eligibility of a qualified individual

for supplemental security income benefits

under this title by reason of disability, by

applying the criteria used in determining eligibility for such benefits of applicants who

have attained 18 years of age.

‘‘(II) The redetermination required by subclause (I) with respect to a qualified individual shall be conducted during the 1-year

period that begins on the date the qualified

individual attains 18 years of age.

‘‘(III) As used in this clause, the term

‘qualified individual’ means an individual

who attains 18 years of age and is a recipient

of benefits under this title by reason of disability.

‘‘(IV) A redetermination under subclause

(I) of this clause shall be considered a substitute for a review required under any other

provision of this subparagraph.’’.

(b) REPORT TO THE CONGRESS.—Not later

than October 1, 1998, the Commissioner of

Social Security shall submit to the Committee on Ways and Means of the House of

Representatives and the Committee on Finance of the Senate a report on the activities conducted under section 1614(a)(3)(G)(iii)

of the Social Security Act.

(c) CONFORMING REPEAL.—Section 207 of

the Social Security Independence and Program Improvements Act of 1994 (42 U.S.C.

1382 note; 108 Stat. 1516) is hereby repealed.

SEC. 804. APPLICABILITY.

(a) NEW ELIGIBILITY STANDARDS AND DISABILITY REVIEWS FOR CHILDREN.—

(1) IN GENERAL.—Except as provided in

paragraph (2), the amendments made by sections 801 and 802 shall apply to benefits for

months beginning more than 9 months after

the date of the enactment of this Act, without regard to whether regulations have been

issued to implement such amendments.

(2) TRANSITIONAL RULE.—

(A) IN GENERAL.—For months beginning

after the date of the enactment of this Act

and before the first month to which the

amendments made by section 801 apply under

paragraph (1) and subject to subparagraph

(B), no individual who has not attained 18

years of age shall be considered to be disabled for purposes of the supplemental security income program under title XVI of the

Social Security Act solely on the basis of

maladaptive behavior or psychoactive substance dependence disorder.

(B) EXCEPTION FOR CURRENT BENEFICIARIES.—Subparagraph (A) shall not apply

in the case of an individual who is a recipient of supplemental security income benefits

under such title for the month in which this

Act becomes law.

(b) DISABILITY REVIEWS FOR 18-YEAR OLD

RECIPIENTS.—The amendments made by section 803 shall apply to benefits for months

beginning after the date of the enactment of

this Act.

Subtitle B—Denial of SSI Benefits by Reason

of Disability to Drug Addicts and Alcoholics

SEC. 811. DENIAL OF SSI BENEFITS BY REASON

OF DISABILITY TO DRUG ADDICTS

AND ALCOHOLICS.

(a) IN GENERAL.—Section 1614(a)(3) (42

U.S.C. 1382c(a)(3)) is amended by adding at

the end the following:

‘‘(I) Notwithstanding subparagraph (A), an

individual shall not be considered to be disabled for purposes of this title if alcoholism

or drug addiction would (but for this subparagraph) be a contributing factor material

to the Commissioner’s determination that

the individual is disabled.’’.
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(b) CONFORMING AMENDMENTS.—

(1) Section 1611(e) (42 U.S.C. 1382(e)) is

amended by striking paragraph (3).

(2) Section 1631(a)(2)(A)(ii) (42 U.S.C.

1383(a)(2)(A)(ii)) is amended—

(A) by striking ‘‘(I)’’; and

(B) by striking subclause (II).

(3) Section 1631(a)(2)(B) (42 U.S.C.

1383(a)(2)(B)) is amended—

(A) by striking clause (vii);

(B) in clause (viii), by striking ‘‘(ix)’’ and

inserting ‘‘(viii)’’;

(C) in clause (ix)—

(i) by striking ‘‘(viii)’’ and inserting

‘‘(vii)’’; and

(ii) in subclause (II), by striking all that

follows ‘‘15 years’’ and inserting a period;

(D) in clause (xiii)—

(i) by striking ‘‘(xii)’’ and inserting ‘‘(xi)’’;

and

(ii) by striking ‘‘(xi)’’ and inserting ‘‘(x)’’;

and

(E) by redesignating clauses (viii) through

(xiii) as clauses (vii) through (xii), respectively.

(4) Section 1631(a)(2)(D)(i)(II) (42 U.S.C.

1383(a)(2)(D)(i)(II)) is amended by striking all

that follows ‘‘$25.00 per month’’ and inserting

a period.

(5) Section 1634 (42 U.S.C. 1383c) is amended

by striking subsection (e).

(6) Section 201(c)(1) of the Social Security

Independence and Program Improvements

Act of 1994 (42 U.S.C. 425 note) is amended—

(A) by striking ‘‘—’’ and all that follows

through ‘‘(A)’’ the 1st place such term appears;

(B) by striking ‘‘and’’ the 3rd place such

term appears;

(C) by striking subparagraph (B);

(D) by striking ‘‘either subparagraph (A) or

subparagraph (B)’’ and inserting ‘‘the preceding sentence’’; and

(E) by striking ‘‘subparagraph (A) or (B)’’

and inserting ‘‘the preceding sentence’’.

(c) EFFECTIVE DATE.—The amendments

made by this section shall take effect on October 1, 1995, and shall apply with respect to

months beginning on or after such date.

(d) FUNDING OF CERTAIN PROGRAMS FOR

DRUG ADDICTS AND ALCOHOLICS.—Out of any

money in the Treasury of the United States

not otherwise appropriated, the Secretary of

the Treasury shall pay to the Director of the

National Institute on Drug Abuse—

(1) $95,000,000, for each of fiscal years 1997,

1998, 1999, and 2000, for expenditure through

the Federal Capacity Expansion Program to

expand the availability of drug treatment;

and

(2) $5,000,000 for each of fiscal years 1997,

1998, 1999, and 2000 to be expended solely on

the medication development project to improve drug abuse and drug treatment research.

TITLE IX—FINANCING

Subtitle A—Treatment of Aliens

SEC. 901. EXTENSION OF DEEMING OF INCOME

AND RESOURCES UNDER AFDC, SSI,

AND FOOD STAMP PROGRAMS.

(a) IN GENERAL.—Except as provided in

subsections (b) and (c), in applying sections

415 and 1621 of the Social Security Act and

section 5(i) of the Food Stamp Act of 1977,

the period in which each respective section

otherwise applies with respect to an alien

shall be extended through the date (if any)

on which the alien becomes a citizen of the

United States (under chapter 2 of title III of

the Immigration and Nationality Act).

(b) EXCEPTION.—Subsection (a) shall not

apply to an alien if—

(1) the alien has been lawfully admitted to

the United States for permanent residence,

has attained 75 years of age, and has resided

in the United States for at least 5 years;

(2) the alien—

(A) is a veteran (as defined in section 101 of

title 38, United States Code) with a discharge

characterized as an honorable discharge,

(B) is on active duty (other than active

duty for training) in the Armed Forces of the

United States, or

(C) is the spouse or unmarried dependent

child of an individual described in subparagraph (A) or (B);

(3) the alien is the subject of domestic violence by the alien’s spouse and a divorce between the alien and the alien’s spouse has

been initiated through the filing of an appropriate action in an appropriate court; or

(4) there has been paid with respect to the

self-employment income or employment of

the alien, or of a parent or spouse of the

alien, taxes under chapter 2 or chapter 21 of

the Internal Revenue Code of 1986 in each of

20 different calendar quarters.

(c) HOLD HARMLESS FOR MEDICAID ELIGIBILITY.—Subsection (a) shall not apply with

respect to determinations of eligibility for

benefits under part A of title IV of the Social

Security Act or under the supplemental income security program under title XVI of

such Act but only insofar as such determinations provide for eligibility for medical assistance under title XIX of such Act.

(d) EFFECTIVE DATE.—This section shall

take effect on October 1, 1995.

SEC. 902. REQUIREMENTS FOR SPONSOR’S AFFIDAVITS OF SUPPORT.

(a) IN GENERAL.—Title II of the Immigration and Nationality Act is amended by inserting after section 213 the following new

section:

‘‘REQUIREMENTS FOR SPONSOR’S AFFIDAVIT OF

SUPPORT

‘‘SEC. 213A. (a) ENFORCEABILITY.—

‘‘(1) IN GENERAL.—No affidavit of support

may be accepted by the Attorney General or

by any consular officer to establish that an

alien is not excludable under section 212(a)(4)

unless such affidavit is executed as a

contract—

‘‘(A) which is legally enforceable against

the sponsor by the Federal Government, by a

State, or by any political subdivision of a

State, providing cash benefits under a public

cash assistance program (as defined in subsection (f)(2)), but not later than 5 years

after the date the alien last receives any

such cash benefit; and

‘‘(B) in which the sponsor agrees to submit

to the jurisdiction of any Federal or State

court for the purpose of actions brought

under subsection (e)(2).

‘‘(2) EXPIRATION OF LIABILITY.—Such contract shall only apply with respect to cash

benefits described in paragraph (1)(A) provided to an alien before the earliest of the

following:

‘‘(A) CITIZENSHIP.—The date the alien becomes a citizen of the United States under

chapter 2 of title III.

‘‘(B) VETERAN.—The first date the alien is

described in section 901(b)(2)(A).

‘‘(C) PAYMENT OF SOCIAL SECURITY TAXES.—

The first date as of which the condition described in section 901(b)(4) is met with respect to the alien.

‘‘(3) NONAPPLICATION DURING CERTAIN PERIODS.—Such contract also shall not apply

with respect to cash benefits described in

paragraph (1)(A) provided during any period

in which the alien is described in section

901(b)(2)(B) or 901(b)(2)(C).

‘‘(b) FORMS.—Not later than 90 days after

the date of enactment of this section, the Attorney General, in consultation with the

Secretary of State and the Secretary of

Health and Human Services, shall formulate

an affidavit of support consistent with the

provisions of this section.

‘‘(c) NOTIFICATION OF CHANGE OF ADDRESS.—

‘‘(1) REQUIREMENT.—The sponsor shall notify the Federal Government and the State

in which the sponsored alien is currently

resident within 30 days of any change of address of the sponsor during the period specified in subsection (a)(1)(A).

‘‘(2) ENFORCEMENT.—Any person subject to

the requirement of paragraph (1) who fails to

satisfy such requirement shall be subject to

a civil penalty of—

‘‘(A) not less than $250 or more than $2,000,

or

‘‘(B) if such failure occurs with knowledge

that the sponsored alien has received any

benefit under any means-tested public benefits program, not less than $2,000 or more

than $5,000.

‘‘(d) REIMBURSEMENT OF GOVERNMENT EXPENSES.—

‘‘(1) REQUEST FOR REIMBURSEMENT.—

‘‘(A) IN GENERAL.—Upon notification that a

sponsored alien has received any cash benefits described in subsection (a)(1)(A), the appropriate Federal, State, or local official

shall request reimbursement by the sponsor

in the amount of such cash benefits.

‘‘(B) REGULATIONS.—The Attorney General,

in consultation with the Secretary of Health

and Human Services, shall prescribe such

regulations as may be necessary to carry out

subparagraph (A).

‘‘(2) INITIATION OF ACTION.—If within 45

days after requesting reimbursement, the appropriate Federal, State, or local agency has

not received a response from the sponsor indicating a willingness to commence payments, an action may be brought against the

sponsor pursuant to the affidavit of support.

‘‘(3) FAILURE TO ABIDE BY REPAYMENT

TERMS.—If the sponsor fails to abide by the

repayment terms established by such agency, the agency may, within 60 days of such

failure, bring an action against the sponsor

pursuant to the affidavit of support.

‘‘(4) LIMITATION ON ACTIONS.—No cause of

action may be brought under this subsection

later than 5 years after the date the alien

last received any cash benefit described in

subsection (a)(1)(A).

‘‘(f) DEFINITIONS.—For the purposes of this

section:

‘‘(1) SPONSOR.—The term ‘sponsor’ means

an individual who—

‘‘(A) is a citizen or national of the United

States or an alien who is lawfully admitted

to the United States for permanent residence;

‘‘(B) is 18 years of age or over; and

‘‘(C) is domiciled in any State.

‘‘(2) PUBLIC CASH ASSISTANCE PROGRAM.—

The term ‘public cash assistance program’

means a program of the Federal Government

or of a State or political subdivision of a

State that provides direct cash assistance for

the purpose of income maintenance and in

which the eligibility of an individual, household, or family eligibility unit for cash benefits under the program, or the amount of

such cash benefits, or both are determined

on the basis of income, resources, or financial need of the individual, household, or

unit. Such term does not include any program insofar as it provides medical, housing,

education, job training, food, or in-kind assistance or social services.’’.

(b) CLERICAL AMENDMENT.—The table of

contents of such Act is amended by inserting

after the item relating to section 213 the following:

‘‘Sec. 213A. Requirements for sponsor’s affidavit of support.’’.

(c) EFFECTIVE DATE.—Subsection (a) of section 213A of the Immigration and Nationality Act, as inserted by subsection (a) of

this section, shall apply to affidavits of support executed on or after a date specified by

the Attorney General, which date shall be

not earlier than 60 days (and not later than

90 days) after the date the Attorney General

formulates the form for such affidavits under

subsection (b) of such section 213A.
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SEC. 903. EXTENDING REQUIREMENT FOR AFFIDAVITS OF SUPPORT TO FAMILY-RELATED AND DIVERSITY IMMIGRANTS.

(A) IN GENERAL.—Section 212(a)(4) of the

Immigration and Nationality Act (8 U.S.C.

1182(a)(4)) is amended to read as follows:

‘‘(4) PUBLIC CHARGE AND AFFIDAVITS OF SUPPORT.—

‘‘(A) PUBLIC CHARGE.—Any alien who, in

the opinion of the consular officer at the

time of application for a visa, or in the opinion of the Attorney General at the time of

application for admission or adjustment of

status, is likely at any time to become a

public charge is excludable.

‘‘(B) AFFIDAVITS OF SUPPORT.—Any immigrant who seeks admission or adjustment of

status as any of the following is excludable

unless there has been executed with respect

to the immigrant an affidavit of support pursuant to section 213A:

‘‘(i) As an immediate relative (under section 201(b)(2)).

‘‘(ii) As a family-sponsored immigrant

under section 203(a) (or as the spouse or child

under section 203(d) of such an immigrant).

‘‘(iii) As the spouse or child (under section

203(d)) of an employment-based immigrant

under section 203(b).

‘‘(iv) As a diversity immigrant under section 203(c) (or as the spouse or child under

section 203(d) of such an immigrant).’’.

(b) EFFECTIVE DATE.—The amendment

made by subsection (a) shall apply to aliens

with respect to whom an immigrant visa is

issued (or adjustment of status is granted)

after the date specified by the Attorney General under section 902(c).

Subtitle B—Limitation on Emergency

Assistance Expenditures

SEC. 911. LIMITATION ON EXPENDITURES FOR

EMERGENCY ASSISTANCE.

(a) IN GENERAL.—Section 403(a)(5) (42

U.S.C. 602(a)(5)) is amended to read as follows:

‘‘(5) in the case of any State, an amount

equal to the lesser of—

‘‘(A) 50 percent of the total amount expended under the State plan during such

quarter as emergency assistance to needy

families with children; or

‘‘(B) the greater of—

‘‘(i) the total amount expended under the

State plan during the fiscal year that immediately precedes the fiscal year in which the

quarter occurs; multiplied by

‘‘(I) 4 percent, if the national unemployment rate for the United States (as determined by the Secretary of Labor) for the 3rd

or 4th quarter of the immediately preceding

fiscal year is at least 7 percent; or

‘‘(II) 3 percent, otherwise; or

‘‘(ii) the total amount expended under the

State plan during fiscal year 1995 as emergency assistance to needy families with children.’’.

(b) AUTHORITY OF STATES TO DEFINE EMERGENCY ASSISTANCE.—Section 406(e)(1) (42

U.S.C. 606(e)(1)) is amended to read as follows:

‘‘(e)(1)(A) The term ‘emergency assistance

to needy families with children’ means emergency assistance furnished by an eligible

State with respect to an eligible needy child

to avoid destitution of the child or to provide living arrangements in a home for the

child.

‘‘(B) As used in this paragraph:

‘‘(i) The term ‘emergency assistance’

means emergency assistance as provided for

in the State plan approved under section 402

of an eligible State, but shall not include

care for an eligible needy child or other

member of the household in which the child

is living to the extent that the child or other

member is entitled to such care as medical

assistance under the State plan under title

XIX.

‘‘(ii) The term ‘eligible needy child’ means

a needy child—

‘‘(I) who has not attained 21 years of age;

‘‘(II) who is or (within such period as the

Secretary may specify) has been living with

any relative specified in subsection (a)(1) in

a place of residence maintained by 1 or more

of such relatives as the home of the relative

or relatives;

‘‘(III) who is without available resources;

and

‘‘(IV) whose requirement for emergency assistance did not arise because the child or

relative refused without good cause to accept

employment or training for employment.

‘‘(iii) The term ‘‘eligible State’’ means a

State whose State plan approved under section 402 includes provision for emergency assistance.’’.

Subtitle C—Tax Provisions

SEC. 921. CERTAIN FEDERAL ASSISTANCE INCLUDIBLE IN GROSS INCOME.

(a) IN GENERAL.—Part II of subchapter B of

chapter 1 of the Internal Revenue Code of

1986 (relating to items specifically included

in gross income) is amended by adding at the

end the following new section:

‘‘SEC. 91. CERTAIN FEDERAL ASSISTANCE.

‘‘(a) IN GENERAL.—Gross income shall include an amount equal to the specified Federal assistance received by the taxpayer during the taxable year.

‘‘(b) SPECIFIED FEDERAL ASSISTANCE.—For

purposes of this section—

‘‘(1) IN GENERAL.—The term ‘specified Federal assistance’ means—

‘‘(A) aid provided under a State plan approved under part A of title IV of the Social

Security Act (relating to aid to families with

dependent children), and

‘‘(B) assistance provided under any food

stamp program.

‘‘(2) SPECIAL RULE.—In the case of assistance provided under a program described in

subsection (d)(2), such term shall include

only the assistance required to be provided

under section 21 or 22 (as the case may be) of

the Food Stamp Act of 1977.

‘‘(c) INDIVIDUALS SUBJECT TO TAX.—For

purposes of this section—

‘‘(1) AFDC.—Aid described in subsection

(b)(1)(A) shall be treated as received by the

relative with whom the dependent child is

living (within the meaning of section 406(c)

of the Social Security Act).

‘‘(2) FOOD STAMPS.—In the case of assistance described in subsection (b)(1)(B)—

‘‘(A) IN GENERAL.—Except as provided in

subparagraph (B), such assistance shall be

treated as received ratably by each of the individuals taken into account in determining

the amount of such assistance for the benefit

of such individuals.

‘‘(B) ASSISTANCE TO CHILDREN TREATED AS

RECEIVED BY PARENTS, ETC.—The amount of

assistance which would (but for this subparagraph) be treated as received by a child shall

be treated as received as follows:

‘‘(i) If there is an includible parent, such

amount shall be treated as received by the

includible parent (or if there is more than 1

includible parent, as received ratably by

each includible parent).

‘‘(ii) If there is no includible parent and

there is an includible grandparent, such

amount shall be treated as received by the

includible grandparent (or if there is more

than 1 includible grandparent, as received

ratably by each includible grandparent).

‘‘(iii) If there is no includible parent or

grandparent, such amount shall be treated as

received ratably by each includible adult.

‘‘(C) DEFINITIONS.—For purposes of subparagraph (B)—

‘‘(i) CHILD.—The term ‘child’ means any individual who has not attained age 16 as of

the close of the taxable year. Such term

shall not include any individual who is an includible parent of a child (as defined in the

preceding sentence).

‘‘(ii) ADULT.—The term ‘adult’ means any

individual who is not a child.

‘‘(iii) INCLUDIBLE.—The term ‘includible’

means, with respect to any individual, an individual who is included in determining the

amount of assistance paid to the household

which includes the child.

‘‘(iv) PARENT.—The term ‘parent’ includes

the stepfather and stepmother of the child.

‘‘(v) GRANDPARENT.—The term ‘grandparent’ means any parent of a parent of the

child.

‘‘(d) FOOD STAMP PROGRAM.—For purposes

of subsection (b), the term ‘food stamp program’ means—

‘‘(1) the food stamp program (as defined in

section 3(h) of the Food Stamp Act of 1977),

and

‘‘(2) the portion of the program under sections 21 and 22 of such Act which provides

food assistance.’’

(b) REPORTING.—

(1) IN GENERAL.—Subpart B of part III of

subchapter A of chapter 61 of such Code is

amended by adding at the end the following

new section:

‘‘SEC. 6050Q. PAYMENTS OF CERTAIN FEDERAL

ASSISTANCE.

‘‘(a) REQUIREMENT OF REPORTING.—The appropriate official shall make a return, according to the forms and regulations prescribed by the Secretary, setting forth—

‘‘(1) the aggregate amount of specified Federal assistance paid to any individual during

any calendar year, and

‘‘(2) the name, address, and TIN of such individual.

‘‘(b) STATEMENTS TO BE FURNISHED TO PERSONS WITH RESPECT TO WHOM INFORMATION IS

REQUIRED.—Every person required to make a

return under subsection (a) shall furnish to

each individual whose name is required to be set forth in such return a written statement showing—

‘‘(1) the name of the agency making the

payments, and

‘‘(2) the aggregate amount of payments

made to the individual which are required to

be shown on such return.

The written statement required under the

preceding sentence shall be furnished to the

individual on or before January 31 of the

year following the calendar year for which

the return under subsection (a) was required

to be made.

‘‘(c) DEFINITIONS AND SPECIAL RULE.—For

purposes of this section—

‘‘(1) APPROPRIATE OFFICIAL.—The term ‘appropriate official’ means—

‘‘(A) in the case of specified Federal assistance described in section 91(b)(1)(A), the

head of the State agency administering the

plan under which such assistance is provided,

‘‘(B) in the case of specified Federal assistance described in section 91(b)(1)(B), the head

of the State agency administering the program under which such assistance is provided, and

‘‘(C) in the case of specified Federal assistance described in section 91(b)(1)(C), the head

of the State pubic housing agency administering the program under which such assistance is provided.

‘‘(2) SPECIFIED FEDERAL ASSISTANCE.—The

term ‘specified Federal assistance’ has the

meaning given such term by section 91(b).

‘‘(3) AMOUNTS TREATED AS PAID.—The rules

of section 91(c) shall apply for purposes of determining to whom specified Federal assistance is paid.’’

(2) PENALTIES.—

(A) Subparagraph (B) of section 6724(b)(1)

of such Code is amended by redesignating

clauses (ix) through (xiv) as clauses (x)

through (xv), respectively, and by inserting

after clause (viii) the following new clause:
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T49.12 MARCH 23

‘‘(ix) section 6050Q (relating to payments of

certain Federal assistance),’’.

(B) Paragraph (2) of section 6724(d) of such

Code is amended by redesignating subparagraphs (Q) through (T) as subparagraphs (R)

through (U), respectively, and by inserting

after subparagraph (P) the following new

subparagraph:

‘‘(Q) section 6050Q(b) (relating to payments

of certain Federal assistance),’’.

(c) CLERICAL AMENDMENTS.—

(1) The table of sections for part II of subchapter B of chapter 1 of such Code is amended by adding at the end the following new

item:

‘‘Sec. 91. Certain Federal assistance.’’

(2) The table of sections for subpart B of

part III of subchapter A of chapter 61 of such

Code is amended by adding at the end the

following new item:

‘‘Sec. 6050Q. Payments of certain Federal assistance.’’

(d) EFFECTIVE DATE.—The amendments

made by this section shall apply to benefits

received after December 31, 1995.

SEC. 922. EARNED INCOME TAX CREDIT DENIED

TO INDIVIDUALS NOT AUTHORIZED

TO BE EMPLOYED IN THE UNITED

STATES.

(a) IN GENERAL.—Section 32(c)(1) of the Internal Revenue Code of 1986 (relating to individuals eligible to claim the earned income

tax credit) is amended by adding at the end

the following new subparagraph:

‘‘(F) IDENTIFICATION NUMBER REQUIREMENT.—The term ‘eligible individual’ does

not include any individual who does not include on the return of tax for the taxable

year—

‘‘(i) such individual’s taxpayer identification number, and

‘‘(ii) if the individual is married (within

the meaning of section 7703), the taxpayer

identification number of such individual’s

spouse.’’

(b) SPECIAL IDENTIFICATION NUMBER.—Section 32 of such Code is amended by adding at

the end the following new subsection:

‘‘(k) IDENTIFICATION NUMBERS.—Solely for

purposes of subsections (c)(1)(F) and

(c)(3)(D), a taxpayer identification number

means a social security number issued to an

individual by the Social Security Administration (other than a social security number

issued pursuant to clause (II) (or that portion of clause (III) that relates to clause (II))

of section 205(c)(2)(B)(i) of the Social Security Act).’’

(c) EXTENSION OF PROCEDURES APPLICABLE

TO MATHEMATICAL OR CLERICAL ERRORS.—

Section 6213(g)(2) of such Code (relating to

the definition of mathematical or clerical errors) is amended by striking ‘‘and’’ at the

end of subparagraph (D), by striking the period at the end of subparagraph (E) and inserting ‘‘, and’’, and by inserting after subparagraph (E) the following new subparagraph:

‘‘(F) an omission of a correct taxpayer

identification number required under section

32 (relating to the earned income tax credit)

to be included on a return.’’

(d) EFFECTIVE DATE.—The amendments

made by this section shall apply to taxable

years beginning after December 31, 1995.

SEC. 923. PHASEOUT OF EARNED INCOME CREDIT

FOR INDIVIDUALS HAVING MORE

THAN $2,500 OF TAXABLE INTEREST

AND DIVIDENDS.

(a) IN GENERAL.—Section 32 of the Internal

Revenue Code of 1986 is amended by redesignating subsections (i) and (j) as subsections

(j) and (k), respectively, and by inserting

after subsection (h) the following new subsection:

‘‘(i) PHASEOUT OF CREDIT FOR INDIVIDUALS

HAVING MORE THAN $2,500 OF TAXABLE INTEREST AND DIVIDENDS.—If the aggregate

amount of interest and dividends includible

in the gross income of the taxpayer for the

taxable year exceeds $2,500, the amount of

the credit which would (but for this subsection) be allowed under this section for

such taxable year shall be reduced (but not

below zero) by an amount which bears the

same ratio to such amount of credit as such

excess bears to $650.’’

(b) INFLATION ADJUSTMENT.—Subsection (j)

of section 32 of such Code (relating to inflation adjustments), as redesignated by subsection (a), is amended by striking paragraph

(2) and by inserting the following new paragraphs:

‘‘(2) INTEREST AND DIVIDEND INCOME LIMITATION.—In the case of a taxable year beginning in a calendar year after 1996, each dollar

amount contained in subsection (i) shall be

increased by an amount equal to—

‘‘(A) such dollar amount, multiplied by

‘‘(B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar

year in which the taxable year begins, determined by substituting ‘calendar year 1995’

for ‘calendar year 1992’ in subparagraph (B)

thereof.

‘‘(3) ROUNDING.—If any amount as adjusted

under paragraph (1) or (2) is not a multiple of

$10, such dollar amount shall be rounded to

the nearest multiple of $10.’’

(c) EFFECTIVE DATE.—The amendments

made by this section shall apply to taxable

years beginning after December 31, 1995.

SEC. 924. AFDC AND FOOD STAMP BENEFITS NOT

TAKEN INTO ACCOUNT FOR PURPOSES OF THE EARNED INCOME TAX

CREDIT.

(a) IN GENERAL.—Section 32 of the Internal

Revenue Code of 1986 (relating to the earned

income tax credit), as amended by section

932(b) of this Act, is amended by adding at

the end the following new subsection:

‘‘(l) ADJUSTED GROSS INCOME DETERMINED

WITHOUT REGARD TO CERTAIN FEDERAL ASSISTANCE.—For purposes of this section, adjusted gross income shall be determined

without regard to any amount which is includible in gross income solely by reason of

section 91.’’.

(b) EFFECTIVE DATE.—The amendment

made by this section shall apply to taxable

years beginning after December 31, 1995.

TITLE X—FOOD ASSISTANCE REFORM

Subtitle A—Food Stamp Program Integrity

and Reform

SEC. 1001. AUTHORITY TO ESTABLISH AUTHORIZATION PERIODS.

Section 9(a)(1) of the Food Stamp Act of

1977 (7 U.S.C. 2018(a)(1)) is amended by adding

at the end the following: ‘‘The Secretary is

authorized to issue regulations establishing

specific time periods during which authorization to accept and redeem coupons under the

food stamp program shall be valid.’’.

SEC. 1002. SPECIFIC PERIOD FOR PROHIBITING

PARTICIPATION OF STORES BASED

ON LACK OF BUSINESS INTEGRITY.

Section 9(a)(1) of the Food Stamp Act of

1977 (7 U.S.C. 2018(a)(1)), as amended by section 1001, is amended by adding at the end

the following: ‘‘The Secretary is authorized

to issue regulations establishing specific

time periods during which a retail food store

or wholesale food concern that has an application for approval to accept and redeem

coupons denied or that has such an approval

withdrawn on the basis of business integrity

and reputation cannot submit a new application for approval. Such periods shall reflect

the severity of business integrity infractions

that are the basis of such denials or withdrawals.’’.

SEC. 1003. INFORMATION FOR VERIFYING ELIGIBILITY FOR AUTHORIZATION.

Section 9(c) of the Food Stamp Act of 1977

(7 U.S.C. 2018(c)) is amended—

(1) in the first sentence by inserting ‘‘,

which may include relevant income and sales

tax filing documents,’’ after ‘‘submit information’’ ; and

(2) by inserting after the first sentence the

following: ‘‘The regulations may require retail food stores and wholesale food concerns

to provide written authorization for the Secretary to verify all relevant tax filings with

appropriate agencies and to obtain corroborating documentation from other sources in

order that the accuracy of information provided by such stores and concerns may be

verified.’’.

SEC. 1004. WAITING PERIOD FOR STORES THAT

INITIALLY FAIL TO MEET AUTHORIZATION CRITERIA.

Section 9(d) of the Food Stamp Act of 1977

(7 U.S.C. 2018(d)) is amended by adding at the

end the following: ‘‘Regulations issued pursuant to this Act shall prohibit a retail food

store or wholesale food concern that has an

application for approval to accept and redeem coupons denied because it does not

meet criteria for approval established by the

Secretary in regulations from submitting a

new application for six months from the date

of such denial.’’.

SEC. 1005. BASIS FOR SUSPENSIONS AND DISQUALIFICATIONS.

Section 12(a) of the Food Stamp Act of 1977

(7 U.S.C. 2021(a)) is amended by adding at the

end the following: ‘‘Regulations issued pursuant to this Act shall provide criteria for

the finding of violations and the suspension

or disqualification of a retail food store or

wholesale food concern on the basis of evidence which may include, but is not limited

to, facts established through on-site investigations, inconsistent redemption data, or

evidence obtained through transaction reports under electronic benefit transfer systems.’’.

SEC. 1006. AUTHORITY TO SUSPEND STORES VIOLATING PROGRAM REQUIREMENTS

PENDING ADMINISTRATIVE AND JUDICIAL REVIEW.

(a) Section 12(a) of the Food Stamp Act of

1977 (7 U.S.C. 2021(a)), as amended by section

1005, is amended by adding at the end the following: ‘‘Such regulations may establish criteria under which the authorization of a retail food store or wholesale food concern to

accept and redeem coupons may be suspended at the time such store or concern is

initially found to have committed violations

of program requirements. Such suspension

may coincide with the period of a review as

provided in section 14. The Secretary shall

not be liable for the value of any sales lost

during any suspension or disqualification period.’’.

(b) Section 14(a) of the Food Stamp Act of

1977 (7 U.S.C. 2023(a)) is amended—

(1) in the first sentence by inserting ‘‘suspended,’’ before ‘‘disqualified or subjected’’;

(2) in the fifth sentence by inserting before

the period at the end the following: ‘‘, except

that in the case of the suspension of a retail

food store or wholesale food concern pursuant to section 12(a), such suspension shall remain in effect pending any administrative or

judicial review of the proposed disqualification action, and the period of suspension

shall be deemed a part of any period of disqualification which is imposed.’’; and

(3) by striking the last sentence.

SEC. 1007. DISQUALIFICATION OF RETAILERS

WHO ARE DISQUALIFIED FROM THE

WIC PROGRAM.

Section 12 of the Food Stamp Act of 1977 (7

U.S.C. 2021) is amended by adding at the end

the following:

‘‘(g) The Secretary shall issue regulations

providing criteria for the disqualification of

approved retail food stores and wholesale

food concerns that are otherwise disqualified

from accepting benefits under the Special

Supplemental Nutrition Program for
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1995 T49.12

Women, Infants and Children (WIC) authorized under section 17 of the Child Nutrition

Act of 1966. Such disqualification—

‘‘(1) shall be for the same period as the disqualification from the WIC Program;

‘‘(2) may begin at a later date; and

‘‘(3) notwithstanding section 14 of this Act,

shall not be subject to administrative or judicial review.’’.

SEC. 1008. PERMANENT DEBARMENT OF RETAILERS WHO INTENTIONALLY SUBMIT

FALSIFIED APPLICATIONS.

Section 12 of the Food Stamp Act of 1977 (7

U.S.C. 2021), as amended by section 1007, is

amended by adding at the end the following:

‘‘(h) The Secretary shall issue regulations

providing for the permanent disqualification

of a retail food store or wholesale food concern that is determined to have knowingly

submitted an application for approval to accept and redeem coupons which contains

false information about one or more substantive matters which were the basis for

providing approval. Any disqualification imposed under this subsection shall be subject

to administrative and judicial review pursuant to section 14, but such disqualification

shall remain in effect pending such review.’’.

SEC. 1009. EXPANDED CIVIL AND CRIMINAL FORFEITURE FOR VIOLATIONS OF THE

FOOD STAMP ACT.

(a) FORFEITURE OF ITEMS EXCHANGED IN

FOOD STAMP TRAFFICKING.—Section 15(g) of

the Food Stamp Act of 1977 (7 U.S.C. 2024(g))

is amended by striking ‘‘or intended to be

furnished’’.

(b) CIVIL AND CRIMINAL FORFEITURE.—Section 15 of the Food Stamp Act of 1977 (7

U.S.C. 2024)) is amended by adding at the end

the following:

‘‘(h)(1) CIVIL FORFEITURE FOR FOOD STAMP

BENEFIT VIOLATIONS.—

‘‘(A) Any food stamp benefits and any

property, real or personal—

‘‘(i) constituting, derived from, or traceable to any proceeds obtained directly or indirectly from, or

‘‘(ii) used, or intended to be used, to commit, or to facilitate,

the commission of a violation of subsection

(b) or subsection (c) involving food stamp

benefits having an aggregate value of not

less than $5,000, shall be subject to forfeiture

to the United States.

‘‘(B) The provisions of chapter 46 of title

18, relating to civil forfeitures shall extend

to a seizure or forfeiture under this subsection, insofar as applicable and not inconsistent with the provisions of this subsection.

‘‘(2) CRIMINAL FORFEITURE FOR FOOD STAMP

BENEFIT VIOLATIONS.—

‘‘(A)(i) Any person convicted of violating

subsection (b) or subsection (c) involving

food stamp benefits having an aggregate

value of not less than $5,000, shall forfeit to

the United States, irrespective of any State

law—

‘‘(I) any food stamp benefits and any property constituting, or derived from, or traceable to any proceeds such person obtained directly or indirectly as a result of such violation; and

‘‘(II) any food stamp benefits and any of

such person’s property used, or intended to

be used, in any manner or part, to commit,

or to facilitate the commission of such violation.

‘‘(ii) In imposing sentence on such person,

the court shall order that the person forfeit

to the United States all property described

in this subsection.

‘‘(B) All food stamp benefits and any property subject to forfeiture under this subsection, any seizure and disposition thereof,

and any administrative or judicial proceeding relating thereto, shall be governed

by subsections (b), (c), (e), and (g) through

(p) of section 413 of the Comprehensive Drug

Abuse Prevention and Control Act of 1970 (21

U.S.C. 853), insofar as applicable and not inconsistent with the provisions of this subsection.

‘‘(3) This subsection shall not apply to

property specified in subsection (g) of this

section.

‘‘(4) The Secretary may prescribe such

rules and regulations as may be necessary to

carry out this subsection.’’.

SEC. 1010. EXPANDED AUTHORITY FOR SHARING

INFORMATION PROVIDED BY RETAILERS.

(a) Section 205(c)(2)(C)(iii) (42 U.S.C.

405(c)(2)(C)(iii)) (as amended by section 316(a)

of the Social Security Administrative Reform Act of 1994 (Public Law 103–296; 108

Stat. 1464) is amended—

(1) by inserting in the first sentence of subclause (II) after ‘‘instrumentality of the

United States’’ the following: ‘‘, or State

government officers and employees with law

enforcement or investigative responsibilities, or State agencies that have the responsibility for administering the Special Supplemental Nutrition Program for Women, Infants and Children (WIC)’’;

(2) by inserting in the last sentence of subclause (II) immediately after ‘‘other Federal’’ the words ‘‘or State’’; and

(3) by inserting ‘‘or a State’’ in subclause

(III) immediately after ‘‘United States’’.

(b) Section 6109(f)(2) of the Internal Revenue Code of 1986 (26 U.S.C. 6109(f)(2)) (as

added by section 316(b) of the Social Security

Administrative Reform Act of 1994 (Public

Law 103–296; 108 Stat. 1464)) is amended—

(1) by inserting in subparagraph (A) after

‘‘instrumentality of the United States’’ the

following: ‘‘, or State government officers

and employees with law enforcement or investigative responsibilities, or State agencies that have the responsibility for administering the Special Supplemental Nutrition

Program for Women, Infants and Children

(WIC)’’;

(2) in the last sentence of subparagraph (A)

by inserting ‘‘or State’’ after ‘‘other Federal’’; and

(3) in subparagraph (B) by inserting ‘‘or a

State’’ after ‘‘United States’’.

SEC. 1011. EXPANDED DEFINITION OF ‘‘COUPON’’.

Section 3(d) of the Food Stamp Act of 1977

(7 U.S.C. 2012(d)) is amended by striking ‘‘or

type of certificate’’ and inserting ‘‘type of

certificate, authorization cards, cash or

checks issued of coupons or access devices,

including, but not limited to, electronic benefit transfer cards and personal identification numbers’’.

SEC. 1012. DOUBLED PENALTIES FOR VIOLATING

FOOD STAMP PROGRAM REQUIREMENTS.

Section 6(b)(1) of the Food Stamp Act of

1977 (7 U.S.C. 2015(b)(1)) is amended—

(1) in clause (i)—

(A) by striking ‘‘six months’’ and inserting

‘‘1 year’’; and

(B) by adding ‘‘and’’ at the end; and

(2) striking clauses (ii) and (iii) and inserting the following:

‘‘(ii) permanently upon—

‘‘(I) the second occasion of any such determination; or

‘‘(II) the first occasion of a finding by a

Federal, State, or local court of the trading

of a controlled substance (as defined in section 102 of the Controlled Substances Act (21

U.S.C. 802)), firearms, ammunition, or explosives for coupons.’’.

SEC. 1013. MANDATORY CLAIMS COLLECTION

METHODS.

(a) Section 11(e)(8) of the Food Stamp Act

of 1977 (7 U.S.C. 2020(e)(8)) is amended by inserting ‘‘or refunds of Federal taxes as authorized pursuant to 31 U.S.C. 3720A’’ before

the semicolon at the end.

(b) Section 13(d) of the Food Stamp Act of

1977 (7 U.S.C. 2022(d)) is amended—

(1) by striking ‘‘may’’ and inserting

‘‘shall’’; and

(2) by inserting ‘‘or refunds of Federal

taxes as authorized pursuant to 31 U.S.C.

3720A’’ before the period at the end.

(c) Section 6103(1) of the Internal Revenue

Code (26 U.S.C. 6103(1)) is amended—

(1) by striking ‘‘officers and employees’’ in

paragraph (10)(A) and inserting ‘‘officers,

employees or agents, including State agencies’’; and

(2) by striking ‘‘officers and employees’’ in

paragraph (10)(B) and inserting ‘‘officers, employees or agents, including State agencies’’.

SEC. 1014. REDUCTION OF BASIC BENEFIT LEVEL.

Section 3(o) of the Food Stamp Act of 1977

(7 U.S.C. 2012(o)) is amended—

(1) by striking ‘‘and (11)’’ and inserting

‘‘(11)’’;

(2) in clause (11) by inserting ‘‘through October 1, 1994’’ after ‘‘each October 1 thereafter’’; and

(3) by inserting before the period at the end

the following:

‘‘, and (12) on October 1, 1995, and on each October 1 thereafter, adjust the cost of such

diet to reflect 102 percent of the cost, in the

preceding June (without regard to any previous adjustment made under this clause or

clauses (4) through (11) of this subsection)

and round the result to the nearest lower

dollar increment for each household size’’.

SEC. 1015. PRO-RATING BENEFITS AFTER INTERRUPTIONS IN PARTICIPATION.

Section 8(c)(2)(B) of the Food Stamp Act of

1977 (7 U.S.C. 2017(c)(2)(B)) is amended by

striking ‘‘of more than one month’’.

SEC. 1016. WORK REQUIREMENT FOR ABLE-BODIED RECIPIENTS.

(a) WORK REQUIREMENT.—Section 6(d) of

the Food Stamp Act of 1977 (7 U.S.C. 2015(d))

is amended by adding at the end the following:

‘‘(5)(A) Except as provided in subparagraphs (B), (C), and (D), an individual who

has received an allotment for six consecutive

months during which such individual has not

been employed a minimum of an average of

20 hours per week shall be disqualified if

such individual is not employed at least an

average of 20 hours per week, participating

in a workfare program under section 20 (or a

comparable State or local workfare program), or participating in and complying

with the requirements of an approved employment and training program under paragraph (4).

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

shall not apply in the case of an individual

who—

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

age;

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

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

household that includes a minor child;

‘‘(iv) is participating a minimum of an average of 20 hours per week and is in compliance with the requirements of—

‘‘(I) a program under the Job Training

Partnership Act (29 U.S.C. 1501 et seq.);

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

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

‘‘(III) another program for the purpose of

employment and training operated by a

State or local government, as determined appropriate by the Secretary; or

‘‘(v) or would otherwise be exempt under

subsection (d)(2).

‘‘(C) The Secretary may waive the requirements of subparagraph (A) in the case of

some or all individuals within all or part of

State if the Secretary finds that such area—

‘‘(i) has an unemployment rate of over 7

percent; or

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

jobs to provide employment for individuals

subject to this paragraph. The Secretary
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shall report to the Committee on Agriculture of the House of Representatives and

the Committee on Agriculture, Nutrition,

and Forestry of the Senate on the basis in

which the Secretary made this decision.

‘‘(D) An individual who has been disqualified from the food stamp program by reason

of subparagraph (A) may reestablish eligibility for assistance—

‘‘(i) by meeting the requirements of subparagraph (A);

‘‘(ii) by becoming exempt under subparagraph (B); or

‘‘(iii) if the Secretary grants a waiver

under subparagraph (C).

‘‘(E) A household (as defined in section 3(i)

of the Food Stamp Act of 1977 (7 U.S.C.

2015(i)) that includes an individual who refuses to work, refuses to look for work, turns

down a job, or refuses to participate in the

State program if the State places the individual in such program shall be ineligible to

receive food stamp benefits. The State agency shall reduce, by such amount the State

considers appropriate, the amount otherwise

payable to a household that includes an individual who fails without good cause to comply with other requirements of the individual responsibility plan signed by the individual.

‘‘(F) The State agency shall make an initial assessment of the skills, prior work experience, and employability of each participant not exempted under subparagraph (B)

within six months of initial certification.

The State agency shall use such assessment,

in consultation with the program participant, to develop an Individual Responsibility

Plan for the participant. Such plan—

‘‘(i) shall provide that participation in food

stamp employment and training activities

shall be a condition of eligibility for food

stamp benefits, except during any period of

unsubsidized full-time employment in the

private sector;

‘‘(ii) shall establish an employment goal

and a plan for moving the individual into

private sector employment immediately;

‘‘(iii) shall establish the obligations of the

participant, which shall include actions that

will help the individual obtain and keep private sector employment; and

‘‘(iv) may require that the individual enter

the State program approved under part G or

part H of title IV of the Social Security Act

if the caseworker determines that the individual will need education, training, job

placement assistance, wage enhancement, or

other services to obtain private sector employment.’’.

(b) ENHANCED EMPLOYMENT AND TRAINING

PROGRAM.—Section 16(h)(1) of the Food

Stamp Act of 1977 (7 U.S.C. 2025 (h)(1)) is

amended—

(1) in subparagraph (A)—

(A) by striking ‘‘$75,000,000’’ and inserting

‘‘$150,000,000’’; and

(B) by striking ‘‘1991 through 1995’’ and inserting ‘‘1996 through 2000’’;

(2) by striking subparagraphs (B), (C), (E)

and (F) and redesignating subparagraph (D)

as subparagraph (B); and

(3) in subparagraph (B) (as so redesignated), by striking ‘‘for each’’ and all that

follows through ‘‘of $60,000,000’’ and inserting

‘‘the Secretary shall allocate funding’’.

(c) REQUIRED PARTICIPATION IN WORK AND

TRAINING PROGRAMS.—Section 6(d)(4) of the

Food Stamp Act of 1977 (7 U.S.C. 2015(d)(4)),

is amended by adding at the end the following:

‘‘(O) The State agency shall provide an opportunity to participate in the employment

and training program under this paragraph

to any individual who would otherwise become subject to disqualification under paragraph (5)(A).’’.

(d) COORDINATING WORK REQUIREMENTS IN

AFDC AND FOOD STAMP PROGRAMS.—Section

6(d)(4) of the Food Stamp Act of 1977 (7

U.S.C. 2015(d)(4)), as amended by subsection

(c), is amended by adding at the end the following:

‘‘(P)(i) Notwithstanding any other provision of this paragraph, a State agency that

meets the participation requirements of

paragraph (ii) may operate its employment

and training program for persons receiving

allotments under this Act as part of its Work

First Program under part F of title IV of the

Social Security Act (42 U.S.C. 681 et seq.), except that sections 487(b) and 489(a)(4) shall

not apply to any months during which a person participates in such program while not

receiving income under part A of subtitle IV

of the Social Security Act (42 U.S.C. 601 et

seq.). If a State agency exercises the option

provided under this subparagraph, the operation of this program shall be subject to the

requirements of such part F, except that any

reference to ‘aid to families with dependent

children’ in such part shall be deemed a reference to food stamp benefits for purposes of

any person not receiving income under such

part A.

‘‘(ii) A State may exercise the option provided under clause (i) if it provides any persons subject to the requirements of paragraph (5) who is not employed at least an average of 20 hours per week or participating in

a workfare program under section 20 (or a

comparable State or local program) with the

opportunity to participate in an approved

employment and training program. A State

agency shall be considered to have complied

with the requirements of this subparagraph

in any area for which a waiver under subsection (5)(4)(C) is in effect.’’.

SEC. 1017. EXTENDING CURRENT CLAIMS RETENTION RATES.

Section 16(a) of the Food Stamp Act of 1977

(7 U.S.C. 2025(a)) is amended by striking

‘‘September 30, 1995’’ each place it appears

and inserting ‘‘September 30, 2000’’.

SEC. 1018. COORDINATION OF EMPLOYMENT AND

TRAINING PROGRAMS.

(a) Section 8(d) of the Food Stamp Act of

1977 (7 U.S.C. 2019(d)) is amended—

(1) by inserting ‘‘or any work requirement

under such program’’ after ‘‘assistance program’’; and

(2) by adding at the end the following:

‘‘If a household fails to comply with a work

requirement in the program under part A of

title IV of the Social Security Act (42 U.S.C.

601 et seq.), the household shall not receive

an increased allotment under this Act as a

result of a decrease in the household’s income caused by a penalty imposed under

such Act, and the State agency is authorized

to reduce the household’s allotment by no

more than 25 percent.’’.

SEC. 1019. PROMOTING EXPANSION OF ELECTRONIC BENEFITS TRANSFER.

Section 7(i) of the Food Stamp Act of 1977

(7 U.S.C. 2016(i)(1)) is amended—

(1) by amending paragraph (1) to read:

‘‘(1)(A) State agencies are encouraged to

implement an on-line electronic benefit

transfer system in which household benefits

determined under section 8(a) are issued

from and stored in a central data bank and

electronically accessed by household members at the point-of-sale.

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

agency is authorized to procure and implement an electronic benefit transfer system

under the terms, conditions, and design that

the State agency deems appropriate.

‘‘(C) The Secretary shall, upon request of a

State agency, waive any provision of this

subsection prohibiting the effective implementation of an electronic benefit transfer

system consistent with the purposes of this

Act. The Secretary shall act upon any request for such a waiver within 90 days of receipt of a complete application.’’;

(2) in paragraph (2), by striking ‘‘for the

approval’’; and

(3) in paragraph (3), by striking ‘‘the Secretary shall not approve such a system unless’’ and inserting ‘‘the State agency shall

ensure that’’.

SEC. 1020. ONE-YEAR FREEZE OF STANDARD DEDUCTION.

Section 5(e) of the Food Stamp Act of 1977

(7 U.S.C. 2014(e)) is amended in the second

sentence by inserting ‘‘except October 1,

1995’’ after ‘‘thereafter’’.

SEC. 1021. NUTRITION ASSISTANCE FOR PUERTO

RICO.

Section 19(a)(1)(A) of the Food Stamp Act

of 1977 (7 U.S.C. 2028(a)(1)(A)) is amended—

(1) by striking ‘‘1994, and’’ and inserting

‘‘1994,’’; and

(2) by inserting ‘‘and $1,143,000,000 for fiscal

year 1996,’’ before ‘‘to finance’’.

SEC. 1022. OTHER AMENDMENTS TO THE FOOD

STAMP ACT OF 1977.

(a) CERTIFICATION PERIOD.—(1) Section 3(c)

of the Food Stamp Act of 1977 (7 U.S.C.

2012(c)) is amended to read as follows:

‘‘(c) ‘Certification period’ means the period

specified by the State agency for which

households shall be eligible to receive authorization cards, except that such period

shall be—

‘‘(1) 24 months for households in which all

adult members are elderly or disabled; and

‘‘(2) not more than 12 months for all other

households.’’.

(2) Section 6(c)(1)(C) of the Food Stamp

Act of 1977 (7 U.S.C. 2015(c)(1)(C)) is

amended—

(A) in clause (ii) by adding ‘‘and’’ at the

end;

(B) in clause (iii) by striking ‘‘; and’’ at the

end and inserting a period; and

(C) by striking clause (iv).

(b) INCLUSION OF ENERGY ASSISTANCE IN INCOME.—

(1) AMENDMENTS TO THE FOOD STAMP ACT OF

1977.—Section 5 of the Food Stamp Act of 1977

(7 U.S.C. 2014) is amended—

(A) in subsection (d)—

(i) by striking paragraph (11); and

(ii) by redesignating paragraphs (12)

through (16) as paragraphs (11) through (15),

respectively; and

(B) in subsection (k)—

(i) in paragraph (1)(B) by striking ‘‘, not including energy or utility-cost assistance,’’;

and

(ii) in paragraph (2)—

(I) by striking subparagraph (C); and

(II) by redesignating subparagraphs (D)

through (H) as subparagraphs (C) through

(J), respectively.

(2) AMENDMENTS TO THE LOW-INCOME HOME

ENERGY ASSISTANCE ACT OF 1981.—Section

2605(f) of the Low-Income Home Energy Assistance Act of 1981 (42 U.S.C. 8624(f)) is

amended—

(A) in paragraph (1) by striking ‘‘food

stamps,’’; and

(B) by amending paragraph (2) to read as

follows:

‘‘(2) Paragraph (1) shall not apply for any

purpose under the Food Stamp Act of 1977.’’.

(c) EXCLUSION OF CERTAIN JTPA INCOME.—

Section 5(d) of the Food Stamp Act of 1977 (7

U.S.C. 2014(d)), as amended by subsection (b),

is amended—

(1) by striking ‘‘and (15)’’ and inserting

‘‘(15)’’; and

(2) by inserting before the period the following:

‘‘, and (16) income received under the Job

Training Partnership Act by a household

member who is less than 19 years of age’’.

(d) EXCLUSION OF EDUCATIONAL ASSISTANCE

FROM INCOME.—Section 5(d) of the Food

Stamp Act of 1977 (7 U.S.C. 2014(d)) is

amended—

(1) by amending paragraph (3) to read as

follows: ‘‘(3) all educational loans on which
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payment is deferred (including any loan

origination fees or insurance premiums associated with such loans), grants, scholarships,

fellowships, veterans’ educational benefits,

and the like awarded to a household member

enrolled at a recognized institution of postsecondary education, at a school for the

handicapped, in a vocational education program, or in a program that provides for completion of a secondary school diploma or obtaining the equivalent thereof,’’; and

(2) in paragraph (5) by striking ‘‘and no

portion’’ and all that follows through ‘‘reimbursement’’.

(e) LIMITATION ON ADDITIONAL EARNED INCOME DEDUCTION.—The 3rd sentence of section 5(e) of the Food Stamp Act of 1977 (7

U.S.C. 2014(e)) is amended by striking

‘‘earned income that’’ and all that follows

through ‘‘report’’, and inserting ‘‘determining an overissuance due to the failure of

a household to report earned income’’.

(f) EXCLUSION OF ESSENTIAL EMPLOYMENTRELATED PROPERTY.—Section 5(g)(3) of the

Food Stamp Act of 1977 (7 U.S.C. 2014(g)(3)) is

amended to read as follows:

‘‘(3) The value of real and tangible personal

property (other than currency, commercial

paper, and similar property) of a household

member that is essential to the employment

or self-employment of such member shall be

excluded by the Secretary from financial resources until the expiration of the 1-year period beginning on the date such member

ceases to be so employed or so self-employed.’’.

(g) EXCLUSION OF LIFE INSURANCE POLICIES.—Section 5(g) of the Food Stamp Act of

1977 (7 U.S.C. 2014(g)) is amended by adding

at the end the following:

‘‘(6) The Secretary shall exclude from financial resources the cash value of any life

insurance policy owned by a member of a

household.’’.

(h) IN-TANDEM EXCLUSIONS FROM INCOME.—

Section 5 of the Food Stamp Act of 1977 (7

U.S.C. 2014) is amended by adding at the end

the following:

‘‘(n) Whenever a Federal statute enacted

after the date of the enactment of this Act

excludes funds from income for purposes of

determining eligibility, benefit levels, or

both under State plans approved under part

A of title IV of the Social Security Act, then

such funds shall be excluded from income for

purposes of determining eligibility, benefit

levels, or both, respectively, under the food

stamp program of households all of whose

members receive benefits under a State plan

approved under part A of title IV of the Social Security Act.’’.

(i) APPLICATION OF AMENDMENTS.—The

amendments made by this section shall not

apply with respect to certification periods

beginning before the effective date of this

section.

Subtitle B—Commodity Distribution

SEC. 1051. SHORT TITLE.

This subtitle may be cited as the ‘‘Commodity Distribution Act of 1995’’.

SEC. 1052. AVAILABILITY OF COMMODITIES.

(a) Notwithstanding any other provision of

law, the Secretary of Agriculture (hereinafter in this subtitle referred to as the ‘‘Secretary’’) is authorized during fiscal years

1996 through 2000 to purchase a variety of nutritious and useful commodities and distribute such commodities to the States for

distribution in accordance with this subtitle.

(b) In addition to the commodities described in subsection (a), the Secretary may

expend funds made available to carry out the

section 32 of the Act of August 24, 1935 (7

U.S.C. 612c), which are not expended or needed to carry out such sections, to purchase,

process, and distribute commodities of the

types customarily purchased under such section to the States for distribution in accordance to this subtitle.

(c) In addition to the commodities described in subsections (a) and (b), agricultural commodities and the products thereof

made available under clause (2) of the second

sentence of section 32 of the Act of August

24, 1935 (7 U.S.C. 612c), may be made available by the Secretary to the States for distribution in accordance with this subtitle.

(d) In addition to the commodities described in subsections (a), (b), and (c), commodities acquired by the Commodity Credit

Corporation that the Secretary determines,

in the discretion of the Secretary, are in excess of quantities needed to—

(1) carry out other domestic donation programs;

(2) meet other domestic obligations;

(3) meet international market development

and food aid commitments, and

(4) carry out the farm price and income

stabilization purposes of the Agricultural

Adjustment Act of 1938, the Agricultural Act

of 1949, and the Commodity Credit Corporation Charter Act; shall be made available by

the Secretary, without charge or credit for

such commodities, to the States for distribution in accordance with this subtitle.

(e) During each fiscal year, the types, varieties, and amounts of commodities to be purchased under this subtitle shall be determined by the Secretary. In purchasing such

commodities, except those commodities purchased pursuant to section 1060, the Secretary shall, to the extent practicable and

appropriate, make purchases based on—

(1) agricultural market conditions;

(2) the preferences and needs of States and

distributing agencies; and

(3) the preferences of the recipients.

SEC. 1053. STATE, LOCAL AND PRIVATE SUPPLEMENTATION OF COMMODITIES.

(a) The Secretary shall establish procedures under which State and local agencies,

recipient agencies, or any other entity or

person may supplement the commodities distributed under this subtitle for use by recipient agencies with nutritious and wholesome

commodities that such entities or persons

donate for distribution, in all or part of the

State, in addition to the commodities otherwise made available under this subtitle.

(b) States and eligible recipient agencies

may use—

(1) the funds appropriated for administrative cost under section 1059(b);

(2) equipment, structures, vehicles, and all

other facilities involved in the storage, handling, or distribution of commodities made

available under this subtitle; and

(3) the personnel, both paid or volunteer,

involved in such storage, handling, or distribution; to store, handle or distribute commodities donated for use under subsection

(a).

(c) States and recipient agencies shall continue, to the maximum extent practical, to

use volunteer workers, and commodities and

other foodstuffs donated by charitable and

other organizations, in the distribution of

commodities under this subtitle.

SEC. 1054. STATE PLAN.

(a) A State seeking to receive commodities

under this subtitle shall submit a plan of operation and administration every four years

to the Secretary for approval. The plan may

be amended at any time, with the approval

of the Secretary.

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

(1) designate the State agency responsible

for distributing the commodities received

under this subtitle;

(2) set forth a plan of operation and administration to expeditiously distribute commodities under this subtitle in quantities requested to eligible recipient agencies in accordance with sections 1056 and 1060;

(3) set forth the standards of eligibility for

recipient agencies; and

(4) set forth the standards of eligibility for

individual or household recipients of commodities, which at minimum shall require—

(A) individuals or households to be comprised of needy persons; and

(B) individual or household members to be

residing in the geographic location served by

the distributing agency at the time of application for assistance.

(c) The Secretary shall encourage each

State receiving commodities under this subtitle to establish a State advisory board consisting of representatives of all interested

entities, both public and private, in the distribution of commodities received under this

subtitle in the State.

(d) A State agency receiving commodities

under this subtitle may—

(1)(A) enter into cooperative agreements

with State agencies of other States to jointly provide commodities received under this

subtitle to eligible recipient agencies that

serve needy persons in a single geographical

area which includes such States; or

(B) transfer commodities received under

this subtitle to any such eligible recipient

agency in the other State under such agreement; and

(2) advise the Secretary of an agreement

entered into under this subsection and the

transfer of commodities made pursuant to

such agreement.

SEC. 1055. ALLOCATION OF COMMODITIES TO

STATES.

(a) In each fiscal year, except for those

commodities purchased under section 1060,

the Secretary shall allocate the commodities

distributed under this subtitle as follows:

(1) 60 percent of such total value of commodities shall be allocated in a manner such

that the value of commodities allocated to

each State bears the same ratio to 60 percent

of such total value as the number of persons

in households within the State having incomes below the poverty line bears to the

total number of persons in households within

all States having incomes below such poverty line. Each State shall receive the value

of commodities allocated under this paragraph.

(2) 40 percent of such total value of commodities shall be allocated in a manner such

that the value of commodities allocated to

each State bears the same ratio to 40 percent

of such total value as the average monthly

number of unemployed persons within the

State bears to the average monthly number

of unemployed persons within all States during the same fiscal year. Each State shall receive the value of commodities allocated to

the State under this paragraph.

(b)(1) The Secretary shall notify each State

of the amount of commodities that such

State is allotted to receive under subsection

(a) or this subsection, if applicable. Each

State shall promptly notify the Secretary if

such State determines that it will not accept

any or all of the commodities made available

under such allocation. On such a notification

by a State, the Secretary shall reallocate

and distribute such commodities in a manner

the Secretary deems appropriate and equitable. The Secretary shall further establish

procedures to permit States to decline to receive portions of such allocation during each

fiscal year in a manner the State determines

is appropriate and the Secretary shall reallocate and distribute such allocation as the

Secretary deems appropriate and equitable.

(2) In the event of any drought, flood, hurricane, or other natural disaster affecting

substantial numbers of persons in a State,

county, or parish, the Secretary may request

that States unaffected by such a disaster

consider assisting affected States by allowing the Secretary to reallocate commodities

from such unaffected State to States containing areas adversely affected by the disaster.
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T49.12 MARCH 23

(c) Purchases of commodities under this

subtitle shall be made by the Secretary at

such times and under such conditions as the

Secretary determines appropriate within

each fiscal year. All commodities so purchased for each such fiscal year shall be delivered at reasonable intervals to States

based on the allocations and reallocations

made under subsections (a) and (b), and or

carry out section 1060, not later than December 31 of the following fiscal year.

SEC. 1056. PRIORITY SYSTEM FOR STATE DISTRIBUTION OF COMMODITIES.

(a) In distributing the commodities allocated under subsections (a) and (b) of section

1055, the State agency, under procedures determined by the State agency, shall offer, or

otherwise make available, its full allocation

of commodities for distribution to emergency feeding organizations.

(b) If the State agency determines that the

State will not exhaust the commodities allocated under subsections (a) and (b) of section

1055 through distribution to organizations

referred to in subsection (a), its remaining

allocation of commodities shall be distributed to charitable institutions described in

section 1063(3) not receiving commodities

under subsection (a).

(c) If the State agency determines that the

State will not exhaust the commodities allocated under subsections (a) and (b) of section

1055 through distribution to organizations

referred to in subsections (a) and (b), its remaining allocation of commodities shall be

distributed to any eligible recipient agency

not receiving commodities under subsections

(a) and (b).

SEC. 1057. INITIAL PROCESSING COSTS.

The Secretary may use funds of the Commodity Credit Corporation to pay the costs

of initial processing and packaging of commodities to be distributed under this subtitle

into forms and in quantities suitable, as determined by the Secretary, for use by the individual households or eligible recipient

agencies, as applicable. The Secretary may

pay such costs in the form of Corporationowned commodities equal in value to such

costs. The Secretary shall ensure that any

such payments in kind will not displace commercial sales of such commodities.

SEC. 1058. ASSURANCES; ANTICIPATED USE.

(a) The Secretary shall take such precautions as the Secretary deems necessary

to ensure that commodities made available

under this subtitle will not displace commercial sales of such commodities or the products thereof. The Secretary shall submit to

the Committee on Agriculture of the House

of Representatives and the Committee on

Agriculture, Nutrition, and Forestry of the

Senate by December 31, 1997, and not less

than every two years thereafter, a report as

to whether and to what extent such displacements or substitutions are occurring.

(b) The Secretary shall determine that

commodities provided under this subtitle

shall be purchased and distributed only in

quantities that can be consumed without

waste. No eligible recipient agency may receive commodities under this subtitle in excess of anticipated use, based on inventory

records and controls, or in excess of its ability to accept and store such commodities.

SEC. 1059. AUTHORIZATION OF APPROPRIATIONS.

(a) PURCHASE OF COMMODITIES.—To carry

out this subtitle, there are authorized to be

appropriated $260,000,000 for each of the fiscal

years 1996 through 2000 to purchase, process,

and distribute commodities to the States in

accordance with this subtitle.

(b) ADMINISTRATIVE FUNDS.—

(1) There are authorized to be appropriated

$40,000,000 for each of the fiscal years 1996

through 2000 for the Secretary to make

available to the States for State and local

payments for costs associated with the distribution of commodities by eligible recipient agencies under this subtitle, excluding

costs associated with the distribution of

those commodities distributed under section

1060. Funds appropriated under this paragraph for any fiscal year shall be allocated

to the States on an advance basis dividing

such funds among the States in the same

proportions as the commodities distributed

under this subtitle for such fiscal year are

allocated among the States. If a State agency is unable to use all of the funds so allocated to it, the Secretary shall reallocate

such unused funds among the other States in

a manner the Secretary deems appropriate

and equitable.

(2)(A) A State shall make available in each

fiscal year to eligible recipient agencies in

the State not less than 40 percent of the

funds received by the State under paragraph

(1) for such fiscal year, as necessary to pay

for, or provide advance payments to cover,

the allowable expenses of eligible recipient

agencies for distributing commodities to

needy persons, but only to the extent such

expenses are actually so incurred by such recipient agencies.

(B) As used in this paragraph, the term

‘‘allowable expenses’’ includes—

(i) costs of transporting, storing, handling,

repackaging, processing, and distributing

commodities incurred after such commodities are received by eligible recipient agencies;

(ii) costs associated with determinations of

eligibility, verification, and documentation;

(iii) costs of providing information to persons receiving commodities under this subtitle concerning the appropriate storage and

preparation of such commodities; and

(iv) costs of recordkeeping, auditing, and

other administrative procedures required for

participation in the program under this subtitle.

(C) If a State makes a payment, using

State funds, to cover allowable expenses of

eligible recipient agencies, the amount of

such payment shall be counted toward the

amount a State must make available for allowable expenses of recipient agencies under

this paragraph.

(3) States to which funds are allocated for

a fiscal year under this subsection shall submit financial reports to the Secretary, on a

regular basis, as to the use of such funds. No

such funds may be used by States or eligible

recipient agencies for costs other than those

involved in covering the expenses related to

the distribution of commodities by eligible

recipient agencies.

(4)(A) Except as provided in subparagraph

(B), to be eligible to receive funds under this

subsection, a State shall provide in cash or

in kind (according to procedures approved by

the Secretary for certifying these in-kind

contributions) from non-Federal sources a

contribution equal to the difference

between—

(i) the amount of such funds so received;

and

(ii) any part of the amount allocated to the

State and paid by the State—

(I) to eligible recipient agencies; or

(II) for the allowable expenses of such recipient agencies;for use in carrying out this

subtitle.

(B) Funds allocated to a State under this

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

based on the estimated contribution required. The Secretary shall periodically reconcile estimated and actual contributions

and adjust allocations to the State to correct for overpayments and underpayments.

(C) Any funds distributed for administrative costs under section 1060(b) shall not be

covered by this paragraph.

(5) States may not charge for commodities

made available to eligible recipient agencies,

and may not pass on to such recipient agencies the cost of any matching requirements,

under this subtitle.

(c) VALUE OF COMMODITIES.—The value of

the commodities made available under subsections (c) and (d) of section 1052, and the

funds of the Corporation used to pay the

costs of initial processing, packaging (including forms suitable for home use), and delivering commodities to the States shall not

be charged against appropriations authorized

by this section.

SEC. 1060. COMMODITY SUPPLEMENTAL FOOD

PROGRAM.

(a) From the funds appropriated under section 1059(a), $94,500,000 shall be used for each

fiscal year to purchase and distribute commodities to supplemental feeding programs

serving woman, infants, and children or elderly individuals (hereinafter in this section

referred to as the ‘‘commodity supplemental

food program′′), or serving both groups wherever located.

(b) Not more than 20 percent of the funds

made available under subsection (a) shall be

made available to the States for State and

local payments of administrative costs associated with the distribution of commodities

by eligible recipient agencies under this section. Administrative costs for the purposes

of the commodity supplemental food program shall include, but not be limited to, expenses for information and referral, operation, monitoring, nutrition education,

start-up costs, and general administration,

including staff, warehouse and transportation personnel, insurance, and administration of the State or local office.

(c)(1) During each fiscal year the commodity supplemental food program is in operation, the types, varieties, and amounts of

commodities to be purchased under this section shall be determined by the Secretary,

but, if the Secretary proposes to make any

significant changes in the types, varieties, or

amounts from those that were available or

were planned at the beginning of the fiscal

year the Secretary shall report such changes

before implementation to the Committee on

Agriculture of the House of Representatives

and the Committee on Agriculture, Nutrition, and Forestry of the Senate.

(2) Notwithstanding any other provision of

law, the Commodity Credit Corporation

shall, to the extent that the Commodity

Credit Corporation inventory levels permit,

provide not less than 9,000,000 pounds of

cheese and not less than 4,000,000 pounds of

nonfat dry milk in each of the fiscal years

1996 through 2000 to the Secretary. The Secretary shall use such amounts of cheese and

nonfat dry milk to carry out the commodity

supplemental food program before the end of

each fiscal year.

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

approve applications of additional sites for

the program, including sites that serve only

elderly persons, in areas in which the program currently does not operate, to the full

extent that applications can be approved

within the appropriations available for the

program for the fiscal year and without reducing actual participation levels (including

participation of elderly persons under subsection (e)) in areas in which the program is

in effect.

(e) If a local agency that administers the

commodity supplemental food program determines that the amount of funds made

available to the agency to carry out this section exceeds the amount of funds necessary

to provide assistance under such program to

women, infants, and children, the agency,

with the approval of the Secretary, may permit low-income elderly persons (as defined

by the Secretary) to participate in and be

served by such program.
HOUSE OF REPRESENTATIVES

479

1995 T49.12

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

pay a significantly higher than expected

price for one or more types of commodities

purchased under this section, the Secretary

shall promptly determine whether the price

is likely to cause the number of persons that

can be served in the program in a fiscal year

to decline.

(2) If the Secretary determines that such a

decline would occur, the Secretary shall

promptly notify the State agencies charged

with operating the program of the decline

and shall ensure that a State agency notify

all local agencies operating the program in

the State of the decline.

(g) Commodities distributed to States pursuant to this section shall not be considered

in determining the commodity allocation to

each State under section 1055 or priority of

distribution under section 1056.

SEC. 1061. COMMODITIES NOT INCOME.

Notwithstanding any other provision of

law, commodities distributed under this subtitle shall not be considered income or resources for purposes of determining recipient

eligibility under any Federal, State, or local

means-tested program.

SEC. 1062. PROHIBITION AGAINST CERTAIN

STATE CHARGES.

Whenever a commodity is made available

without charge or credit under this subtitle

by the Secretary for distribution within the

States to eligible recipient agencies, the

State may not charge recipient agencies any

amount that is in excess of the State’s direct

costs of storing, and transporting to recipient agencies the commodities minus any

amount the Secretary provides the State for

the costs of storing and transporting such

commodities.

SEC. 1063. DEFINITIONS.

As used in this subtitle:

(1) The term ‘‘average monthly number of

unemployed persons’’ means the average

monthly number of unemployed persons

within a State in the most recent fiscal year

for which such information is available as

determined by the Bureau of Labor Statistics of the Department of Labor.

(2) The term ‘‘elderly persons’’ means individuals 60 years of age or older.

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

means a public or nonprofit organization

that administers—

(A) an institution providing commodities

to supplemental feeding programs serving

women, infants, and children or serving elderly persons, or serving both groups;

(B) an emergency feeding organization;

(C) a charitable institution (including hospitals and retirement homes and excluding

penal institutions) to the extent that such

institution serves needy persons;

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

nutrition program providing food service;

(E) a nutrition project operating under the

Older Americans Act of 1965, including such

projects that operate a congregate nutrition

site and a project that provides home-delivered meals; or

(F) a disaster relief program; and that has

been designated by the appropriate State

agency, or by the Secretary, and approved by

the Secretary for participation in the program established under this subtitle.

(4) The term ‘‘emergency feeding organization’’ means a public or nonprofit organization that administers activities and projects

(including the activities and projects of a

charitable institution, a food bank, a food

pantry, a hunger relief center, a soup kitchen, or a similar public or private nonprofit

eligible recipient agency) providing nutrition assistance to relieve situations of emergency and distress through the provision of

food to needy persons, including low-income

and unemployed persons.

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

and charitable institution that maintains an

established operation involving the provision

of food or edible commodities, or the products thereof, to food pantries, soup kitchens,

hunger relief centers, or other food or feeding centers that, as an integral part of their

normal activities, provide meals or food to

feed needy persons on a regular basis.

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

or private nonprofit organization that distributes food to low-income and unemployed

households, including food from sources

other than the Department of Agriculture,

to relieve situations of emergency and distress.

(7) The term ‘‘needy persons’’ means—

(A) individuals who have low incomes or

who are unemployed, as determined by the

State (in no event shall the income of such

individual or household exceed 185 percent of

the poverty line);

(B) households certified as eligible to participate in the food stamp program under the

Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.);

or

(C) individuals or households participating

in any other Federal, or federally assisted,

means-tested program.

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

meaning given such term in section 673(2) of

the Community Services Block Grant Act (42

U.S.C. 9902(2)).

(9) The term ‘‘soup kitchen’’ means a public and charitable institution that, as integral part of its normal activities, maintains

an established feeding operation to provide

food to needy homeless persons on a regular

basis.

SEC. 1064. REGULATIONS.

(a) The Secretary shall issue regulations

within 120 days to implement this subtitle.

(b) In administering this subtitle, the Secretary shall minimize, to the maximum extent practicable, the regulatory, recordkeeping, and paperwork requirements imposed on eligible recipient agencies.

(c) The Secretary shall as early as feasible

but not later than the beginning of each fiscal year, publish in the Federal Register a

nonbinding estimate of the types and quantities of commodities that the Secretary anticipates are likely to be made available

under the commodity distribution program

under this subtitle during the fiscal year.

(d) The regulations issued by the Secretary

under this section shall include provisions

that set standards with respect to liability

for commodity losses for the commodities

distributed under this subtitle in situations

in which there is no evidence of negligence

or fraud, and conditions for payment to

cover such losses. Such provisions shall take

into consideration the special needs and circumstances of eligible recipient agencies.

SEC. 1065. FINALITY OF DETERMINATIONS.

Determinations made by the Secretary

under this subtitle and the facts constituting

the basis for any donation of commodities

under this subtitle, or the amount thereof,

when officially determined in conformity

with the applicable regulations prescribed by

the Secretary, shall be final and conclusive

and shall not be reviewable by any other officer or agency of the Government.

SEC. 1066. RELATIONSHIP TO OTHER PROGRAMS.

(a) Section 4(b) of the Food Stamp Act of

1977 (7 U.S.C. 2013(b)) shall not apply with respect to the distribution of commodities

under this subtitle.

(b) Except as otherwise provided in section

1057, none of the commodities distributed

under this subtitle shall be sold or otherwise

disposed of in commercial channels in any

form.

SEC. 1067. SETTLEMENT AND ADJUSTMENT OF

CLAIMS.

(a) The Secretary may—

(1) determine the amount of, settle, and adjust any claim arising under this subtitle;

and

(2) waive such a claim if the Secretary determines that to do so will serve the purposes of this subtitle.

(b) Nothing contained in this section shall

be construed to diminish the authority of

the Attorney General of the United States

under section 516 of title 28, United States

Code, to conduct litigation on behalf of the

United States.

SEC. 1068. REPEALERS; AMENDMENTS.

(a) REPEALER.—The Emergency Food Assistance Act of 1983 (7 U.S.C. 612c note) is repealed.

(b) AMENDMENTS.—

(1) The Hunger Prevention Act of 1988 (7

U.S.C. 612c note) is amended—

(A) by striking section 110; and

(B) by striking section 502.

(2) The Commodity Distribution Reform

Act and WIC Amendments of 1987 (7 U.S.C.

612c note) is amended by striking section 4.

(3) The Charitable Assistance and Food

Bank Act of 1987 (7 U.S.C. 612c note) is

amended by striking section 3.

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

612c note) is amended—

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

1571; and

(B) in section 1562(d), by striking ‘‘section

4 of the Agricultural and Consumer Protection Act of 1973’’ and inserting ‘‘section 1060

of the Commodity Distribution Act of 1995’’.

(5) The Agricultural and Consumer Protection Act of 1973 (7 U.S.C. 612c note) is

amended—

(A) in section 4(a), by striking ‘‘institutions (including hospitals and facilities caring for needy infants and children), supplemental feeding programs serving women, infants and children or elderly persons, or

both, wherever located, disaster areas, summer camps for children,’’;

(B) in subsection 4(c), by striking ‘‘the

Emergency Food Assistance Act of 1983’’ and

inserting ‘‘the Commodity Distribution Act

of 1995’’; and

(C) by striking section 5.

(6) The Food, Agriculture, Conservation,

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

amended by striking section 1773(f).

Title XI—DEFICIT REDUCTION

SEC. 1101. DEDICATION OF SAVINGS TO DEFICIT

REDUCTION.

(a) Upon the enactment of this Act, the Director of the Office of Management and

Budget shall make downward adjustments in

the discretionary spending limits (new budget authority and outlays), as adjusted, set

forth in 601(a)(2) of the Congressional Budget

Act of 1974 for each of fiscal years 1996

through 1998 as follows:

(1) For fiscal year 1996, reduce new budget

authority by $1,420,000,000 and reduce outlays

by $1,420,000,000.

(2) For fiscal year 1997, reduce new budget

authority by $1,420,000,000 and reduce outlays

by $1,420,000,000.

(3) For fiscal year 1998, reduce new budget

authority by $1,470,000,000 and reduce outlays

by $1,470,000,000.

(b) Reductions in outlays resulting from

the enactment of this Act shall not be taken

into account for purposes of section 252 of

the Balanced Budget and Emergency Deficit

Control Act of 1985.

TITLE XII—EFFECTIVE DATE

SEC. 1201. EFFECTIVE DATE.

Except as otherwise provided in this Act,

this Act and the amendments made by this

Act shall take effect on October 1, 1996.
JOURNAL OF THE

480

T49.13 MARCH 23

It was decided in the Yeas ....... 205 ! negative ....................... Nays ...... 228

T49.13 [Roll No. 266]

AYES—205

Abercrombie

Ackerman

Andrews

Baesler

Baldacci

Barcia

Barrett (WI)

Becerra

Beilenson

Bentsen

Berman

Bevill

Bishop

Bonior

Borski

Boucher

Brewster

Browder

Brown (CA)

Brown (FL)

Brown (OH)

Bryant (TX)

Cardin

Chapman

Clay

Clayton

Clement

Clyburn

Coleman

Collins (IL)

Collins (MI)

Condit

Conyers

Costello

Coyne

Cramer

Danner

de la Garza

Deal

DeFazio

DeLauro

Dellums

Deutsch

Dicks

Dingell

Dixon

Doggett

Dooley

Doyle

Durbin

Edwards

Engel

Eshoo

Evans

Farr

Fattah

Fazio

Fields (LA)

Filner

Flake

Foglietta

Ford

Frank (MA)

Frost

Furse

Gejdenson

Gephardt

Geren

Gibbons

Gonzalez

Gordon

Green

Gutierrez

Hall (OH)

Hall (TX)

Hamilton

Harman

Hastings (FL)

Hayes

Hefner

Hilliard

Hinchey

Holden

Hoyer

Jackson-Lee

Jacobs

Jefferson

Johnson (SD)

Johnson, E. B.

Johnston

Kanjorski

Kaptur

Kennedy (MA)

Kennedy (RI)

Kennelly

Kildee

Kleczka

Klink

LaFalce

Lantos

Laughlin

Levin

Lewis (GA)

Lincoln

Lipinski

Lofgren

Lowey

Luther

Maloney

Manton

Markey

Martinez

Mascara

Matsui

McCarthy

McDermott

McHale

McKinney

McNulty

Meehan

Meek

Menendez

Mfume

Miller (CA)

Mineta

Minge

Mink

Moakley

Mollohan

Montgomery

Moran

Morella

Murtha

Nadler

Neal

Oberstar

Obey

Olver

Ortiz

Orton

Owens

Pallone

Parker

Pastor

Payne (NJ)

Payne (VA)

Pelosi

Peterson (FL)

Peterson (MN)

Pickett

Pomeroy

Poshard

Rahall

Rangel

Reed

Reynolds

Richardson

Rivers

Roemer

Rose

Roybal-Allard

Rush

Sabo

Sanders

Sawyer

Schroeder

Schumer

Scott

Serrano

Sisisky

Skaggs

Skelton

Slaughter

Spratt

Stark

Stenholm

Stokes

Studds

Stupak

Tanner

Tauzin

Taylor (MS)

Tejeda

Thompson

Thornton

Thurman

Torres

Torricelli

Towns

Traficant

Velazquez

Vento

Visclosky

Volkmer

Ward

Waters

Watt (NC)

Waxman

Williams

Wilson

Wise

Woolsey

Wyden

Wynn

Yates

NOES—228

Allard

Archer

Armey

Bachus

Baker (CA)

Baker (LA)

Ballenger

Barr

Barrett (NE)

Bartlett

Barton

Bass

Bateman

Bereuter

Bilbray

Bilirakis

Bliley

Blute

Boehlert

Boehner

Bonilla

Bono

Brownback

Bryant (TN)

Bunn

Bunning

Burr

Burton

Buyer

Callahan

Calvert

Camp

Canady

Castle

Chabot

Chambliss

Chenoweth

Christensen

Chrysler

Clinger

Coble

Coburn

Collins (GA)

Combest

Cooley

Cox

Crane

Crapo

Cremeans

Cubin

Cunningham

Davis

DeLay

Diaz-Balart

Dickey

Doolittle

Dornan

Dreier

Duncan

Dunn

Ehlers

Ehrlich

Emerson

English

Ensign

Everett

Ewing

Fawell

Fields (TX)

Flanagan

Foley

Forbes

Fowler

Fox

Franks (CT)

Franks (NJ)

Frelinghuysen

Frisa

Funderburk

Gallegly

Ganske

Gekas

Gilchrest

Gillmor

Gilman

Goodlatte

Goodling

Goss

Graham

Greenwood

Gunderson

Gutknecht

Hancock

Hansen

Hastert

Hastings (WA)

Hayworth

Hefley

Heineman

Herger

Hilleary

Hobson

Hoekstra

Hoke

Horn

Hostettler

Houghton

Hunter

Hutchinson

Hyde

Inglis

Istook

Johnson (CT)

Johnson, Sam

Jones

Kasich

Kelly

Kim

King

Kingston

Klug

Knollenberg

Kolbe

LaHood

Largent

Latham

LaTourette

Lazio

Leach

Lewis (CA)

Lewis (KY)

Lightfoot

Linder

Livingston

LoBiondo

Longley

Lucas

Manzullo

Martini

McCollum

McCrery

McDade

McHugh

McInnis

McIntosh

McKeon

Metcalf

Meyers

Mica

Miller (FL)

Molinari

Moorhead

Myers

Myrick

Nethercutt

Neumann

Ney

Norwood

Nussle

Oxley

Packard

Paxon

Petri

Pombo

Porter

Portman

Pryce

Quillen

Quinn

Radanovich

Ramstad

Regula

Riggs

Roberts

Rogers

Rohrabacher

Ros-Lehtinen

Roth

Roukema

Royce

Salmon

Sanford

Saxton

Scarborough

Schaefer

Schiff

Seastrand

Sensenbrenner

Shadegg

Shaw

Shays

Shuster

Skeen

Smith (MI)

Smith (NJ)

Smith (TX)

Smith (WA)

Solomon

Souder

Spence

Stearns

Stockman

Stump

Talent

Tate

Taylor (NC)

Thomas

Thornberry

Tiahrt

Torkildsen

Upton

Vucanovich

Waldholtz

Walker

Walsh

Wamp

Watts (OK)

Weldon (FL)

Weldon (PA)

Weller

White

Whitfield

Wicker

Wolf

Young (AK)

Young (FL)

Zeliff

Zimmer

NOT VOTING—1

Tucker

So the amendment in the nature of a

substitute was not ageed to.

The SPEAKER pro tempore, Mr.

CALVERT, assumed the Chair.

When Mr. LINDER, Chairman, reported that the Committee, having had

under consideration said bill, had come

to no resolution thereon.

And then,

T49.14 ADJOURNMENT

On motion of Mr. HAYWORTH, at 12

o’clock midnight, the House adjourned.

T49.15 REPORTS OF COMMITTEES ON

PUBLIC BILLS AND RESOLUTIONS

Under clause 2 of rule XIII, reports of

committees were delivered to the Clerk

for printing and reference to the proper

calendar, as follows:

Mr. BLILEY: Committee on Commerce.

H.R. 1216. A bill to amend the Atomic Energy

Act of 1954 to provide for the privatization of

the United States Enrichment Corporation;

with an amendment (Rept. No. 104–86). Referred to the Committee of the Whole House

on the State of the Union.

Mr. BLILEY: Committee on Commerce.

H.R. 1217. A bill to amend parts B and C of

title XVIII of the Social Security Act to extend certain savings provisions under the

Medicare Program, as incorporated in the

budget submitted by the President for fiscal

year 1996 (Rept. No. 104–87, Pt. 1). Ordered to

be printed.

Mr. BLILEY: Committee on Commerce.

H.R. 1218. A bill to extend the authority of

the Federal Communications Commission to

use competitive bidding in granting licenses

and permits (Rept. No. 104–88). Referred to

the Committee of the Whole House on the

State of the Union.

Mr. KASICH: Committee on the Budget.

H.R. 1219. A bill to amend the Congressional

Budget Act of 1974 and the Balanced Budget

and Emergency Deficit Control Act of 1985 to

extend and reduce the discretionary spending

limits, and for other purposes; with an

amendment (Rept. No. 104–89 Pt. 1). Ordered

to be printed.

T49.16 PUBLIC BILLS AND RESOLUTIONS

Under clause 5 of rule X and clause 4

of rule XXII, public bills and resolutions were introduced and severally referred as follows:

By Mr. BLUTE (for himself and Mr.

FRANK of Massachusetts):

H.R. 1304. A bill to deauthorize a feature of

the project for navigation, Fall River Harbor, MA and Rhode Island; to the Committee

on Transportation and Infrastructure.

By Mr. COSTELLO:

H.R. 1305. A bill to require employers to

notify workers before health care benefits or

retirement benefits are terminated; to the

Committee on Economic and Educational

Opportunities.

By Mr. FALEOMAVAEGA (for himself

and Mr. GALLEGLY):

H.R. 1306. A bill to approve a multiyear

program for the economic development and

self-sufficiency of the U.S. territory of

American Samoa; to the Committee on Resources.

By Mr. FRANK of Massachusetts (for

himself and Mr. BLUTE):

H.R. 1307. A bill to establish the New Bedford Whaling National Historical Park in

New Bedford, MA and for other purposes; to

the Committee on Resources.

By Mr. HUNTER:

H.R. 1308. A bill to withdraw and reserve

certain public lands in the State of California utilized in the mission of the Naval

Air Facility, El Centro, CA; to the Committee on Resources, and in addition to the

Committee on National Security, for a period to be subsequently determined by the

Speaker, in each case for consideration of

such provisions as fall within the jurisdiction of the committee concerned.

By Mr. LIGHTFOOT (for himself, Mr.

LAZIO of New York, Mr. CLINGER, Mr.

DORNAN, Mr. LANTOS, Mrs. MEEK of

Florida, Mrs. MALONEY, Mr. NADLER,

Mr. RAHALL, Mr. SCHAEFER, Mr.

SHAYS, Mr. STARK, Mr. VENTO, Mr.

WELDON of Florida, and Mr. WYNN):

H.R. 1309. A bill to amend title 49, United

States Code, to require the use of child safety restraint systems approved by the Secretary of Transportation on commercial aircraft; to the Committee on Transportation

and Infrastructure.

By Mr. OBERSTAR:

H.R. 1310. A bill to provide for the management of Voyageurs National Park, and for

other purposes; to the Committee on Resources.

By Ms. SLAUGHTER:

H.R. 1311. A bill to provide for a review of

all Federal programs that assess or mitigate

the risks to women’s health from environmental exposures, and for a study of the research needs of the Federal Government relating to such risks; to the Committee on

Commerce, and in addition to the Committee

on Science, for a period to be subsequently

determined by the Speaker, in each case for

consideration of such provisions as fall within the jurisdiction of the committee concerned.

By Ms. WATERS:

H.R. 1312. A bill to establish a freeze on

bank fees for accounts held by average tax-