II

104TH CONGRESS

1ST SESSION S. 736

To amend title IV of the Social Security Act by reforming the aid to families

with dependent children program, and for other purposes.

IN THE SENATE OF THE UNITED STATES

APRIL 27 (legislative day, APRIL 24), 1995

Mr. HARKIN (for himself and Mr. BOND) introduced the following bill; which

was read twice and referred to the Committee on Finance

A BILL

To amend title IV of the Social Security Act by reforming

the aid to families with dependent children program,

and for other purposes.

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

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

4 (a) SHORT TITLE.—This Act may be cited as the

5 ‘‘Welfare to Self-Sufficiency Act of 1995’’.

6 (b) TABLE OF CONTENTS.—The table of contents of

7 this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings.

Sec. 3. Purpose.

Sec. 4. Policy.

Sec. 5. Amendments to Social Security Act.
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TITLE I—FAMILY INVESTMENT PROGRAM AND OTHER WELFARE

REFORM

Sec. 101. State plan required to include family investment program.

Sec. 102. Family investment program.

Sec. 103. Family investment agreement and limited benefit plan.

Sec. 104. Coordination between departments.

Sec. 105. JOBS program.

TITLE II—INCREASING WORK AND SELF-SUFFICIENCY

Subtitle A—Work Incentives

Sec. 201. Increase in work expense disregard.

Sec. 202. Increase in earned income incentive.

Sec. 203. Work transition period.

Sec. 204. Optional State disregard of dependent child’s income.

Sec. 205. Transitional child care program.

Sec. 206. Increase in motor vehicle limit.

Sec. 207. Retrospective budgeting procedures.

Subtitle B—Incentives to Save

Sec. 211. Increase in asset limits.

Sec. 212. Disregard of income and resources designated for education, training,

and employability.

Sec. 213. Disregard of interest income.

Subtitle C—Microenterprise Development and Other Projects to Create Jobs

Sec. 221. Disregard of income and resources related to self-employment.

Sec. 222. Inclusion of microenterprise training and activities in the JOBS program.

Sec. 223. Wage supplementation demonstration projects.

Sec. 224. Projects to expand the number of job opportunities available to certain low-income individuals.

TITLE III—IMPROVING STATE FLEXIBILITY

Sec. 301. Equivalent treatment of stepparent income and parent income.

Sec. 302. AFDC–up program.

Sec. 303. Increased payments to States.

Sec. 304. Optional assessment, monitoring, and evaluation.

Sec. 305. Optional timely preventive health care for children.

TITLE IV—COMBATING TEENAGE PREGNANCY

Sec. 401. Supervised living arrangements for minors.

Sec. 402. Optional requirement of teenage parents to stay in school.

Sec. 403. Additional authorization of Public Health Service Act title X family

planning grants to combat teenage pregnancy.

TITLE V—IMPROVING CHILD SUPPORT COLLECTION

Subtitle A—Improvements in the Collection of Child Support

Sec. 501. Transmission and assignment of certain child support orders to the

IRS.

Sec. 502. Collection of child support by Internal Revenue Service.
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Sec. 503. Optional publication of delinquent child support obligors.

Sec. 504. Optional State law authorizing suspension of licenses.

Sec. 505. Optional community service requirement for delinquent child support

obligors.

Sec. 506. Optional State laws concerning modification of child support orders.

Subtitle B—Improvements in Paternity Establishment

Sec. 511. Optional State laws concerning paternity establishment.

Sec. 512. Optional outreach for voluntary paternity establishment.

Sec. 513. Penalty for failure to establish paternity promptly.

Sec. 514. Incentives to parents to establish paternity.

TITLE VI—SAVINGS PROVISIONS

Sec. 601. Block grants to States to replace certain Federal administrative payments.

Sec. 602. Extension of deeming of income and resources under AFDC, SSI,

medicaid, and food stamp programs.

Sec. 603. Requirements for sponsor’s affidavits of support.

Sec. 604. Extending requirement for affidavits of support to family-related and

diversity immigrants.

Sec. 605. Limitation on expenditures for emergency assistance.

TITLE VII—EFFECTIVE DATE

Sec. 701. Effective date.

1 SEC. 2. FINDINGS.

2 The Congress finds the following:

3 (1) The welfare system is failing recipients and

4 taxpayers and must be reformed.

5 (2) The aid to families with dependent children

6 program under title IV of the Social Security Act

7 (hereafter in this section referred to as ‘‘AFDC’’)

8 remains largely unchanged from its predecessor pro9 gram which was created in 1935, while society has

10 changed dramatically during the same period.

11 (3) The number of female-headed households

12 with children under the age of 18 increased by 146

13 percent from 1970 to 1990, and there are now more
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1 children living in single-parent homes than at any

2 time in the Nation’s history.

3 (4) Expenditures for AFDC increased 13 per4 cent (in inflation adjusted dollars) over a 12-year pe5 riod, from $19,600,000,000 in 1980 to

6 $22,200,000,000 in 1992.

7 (5) The number of families on AFDC has in8 creased 33 percent over a 12-year period, from

9 3,600,000 families in 1980 to 4,800,000 families in

10 1992.

11 (6) There were 2,000,000 more children receiv12 ing welfare in 1992 than there were in 1980 and 1

13 in 5 American children currently live in poverty.

14 (7) Many States are enacting sweeping changes

15 to welfare programs in an effort to curb expendi16 tures and reduce the number of dependent families.

17 (8) Iowa has replaced AFDC with a new ‘‘Fam18 ily Investment Program’’ which requires all families

19 on welfare to enter into a social contract with the

20 State which establishes a specific time-line when wel21 fare benefits will end and outlines the steps that in22 dividual families will take to move off welfare and

23 into work and self-sufficiency.
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1 (9) Welfare reform legislation must recognize

2 the individuality of each family and enact programs

3 that are consistent with this principle.

4 (10) Welfare reform legislation must also recog5 nize the importance of a holistic approach which

6 treats the family as a single unit and not as the sum

7 of its parts.

8 (11) Health care reform is essential to welfare

9 reform because many families remain on public as10 sistance simply because they cannot afford to lose

11 benefits under the medicaid program under title

12 XIX of the Social Security Act for themselves, and,

13 more importantly, for their children.

14 (12) In recent years, there has been a dramatic

15 increase in the number of births to unmarried teen16 agers. Between 1986 and 1991, births to teenagers

17 increased by 11.9 percent, from 50.2 to 62.1 births

18 per 1,000 females.

19 (13) Parents, including noncustodial parents,

20 have a responsibility to provide financial support for

21 their children and failure to provide child support in22 creases the need for AFDC payments.

23 (14) In 1991, the United States Commission on

24 Interstate Child Support reported that the collection

25 of child support fell far short of court awards, with
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1 11,000,000 children being awarded $15,000,000,000

2 in child support payments while approximately

3 $5,000,000,000 in child support payments remained

4 unpaid.

5 SEC. 3. PURPOSE.

6 It is the purpose of this Act to—

7 (1) increase accountability in the aid to families

8 with dependent children program by requiring indi9 viduals to negotiate and sign binding agreements

10 which outline the steps a family will take to move off

11 of welfare and into self-sufficient employment;

12 (2) focus efforts to increase work by welfare re13 cipients and to ensure that these efforts will lead to

14 the economic self-sufficiency of the family;

15 (3) increase flexibility by providing States with

16 policy options to create a welfare program designed

17 to meet the unique needs of the citizens of each

18 State;

19 (4) combat the increase in teenage pregnancy

20 by providing States with expanded options to effec21 tively deal with this serious problem; and

22 (5) improve the collection of child support by

23 reforming the system and provide States with policy

24 options to improve child support collection.
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1 SEC. 4. POLICY.

2 It is the policy of the United States that all programs,

3 projects, and activities receiving assistance under this Act

4 shall be carried out in a manner consistent with the follow5 ing principles:

6 (1) Welfare recipients are required to accept

7 immediate responsibility for their families from the

8 first visit to the welfare office by negotiating and

9 signing a binding agreement that outlines the steps

10 the family will take to become self-sufficient.

11 (2) Failure to sign such an agreement shall re12 sult in the reduction and eventual elimination of

13 cash welfare benefits.

14 (3) Welfare programs are to provide temporary

15 cash assistance for needy families with children and

16 must provide the support and skills that parents

17 need to obtain full-time employment in private sector

18 jobs that will ensure the economic self sufficiency of

19 the family.

20 (4) States must have more flexibility to design

21 welfare program to effectively respond to the needs

22 of welfare recipients in each individual state.

23 (5) Actions must be taken to combat the dra24 matic increase in births among unmarried teenagers.
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1 (6) Children have a right to receive financial

2 support from their parents and no parent shall es3 cape responsibility from providing such support.

4 SEC. 5. AMENDMENTS TO SOCIAL SECURITY ACT.

5 Except as otherwise specifically provided, whenever in

6 this Act an amendment is expressed in terms of an amend7 ment to or repeal of a section or other provision, the ref8 erence shall be considered to be made to that section or

9 other provision of the Social Security Act.

10 TITLE I—FAMILY INVESTMENT

11 PROGRAM AND OTHER WEL12 FARE REFORM

13 SEC. 101. STATE PLAN REQUIRED TO INCLUDE FAMILY IN14 VESTMENT PROGRAM.

15 Section 402(a) (42 U.S.C. 602(a)) is amended by in16 serting after paragraph (28) the following new paragraph:

17 ‘‘(29) except in the case of a State receiving a

18 waiver from the Secretary, provide that the State

19 has in effect a family investment program described

20 in subsection (j);’’.

21 SEC. 102. FAMILY INVESTMENT PROGRAM.

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

23 at the end the following new subsection:

24 ‘‘(j) For purposes of subsection (a)(29)—
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1 ‘‘(1) The term ‘family investment program’

2 means a program under which the State agency—

3 ‘‘(A) negotiates a family investment agree4 ment (as defined in section 406(i)) with at least

5 the implementation percentage (as specified in

6 paragraph (5)(B)) of individuals described in

7 paragraph (2), and

8 ‘‘(B) offers individuals described in para9 graph (2) the opportunity to enter into a lim10 ited benefit agreement (as defined in section

11 406(j)) in lieu of such family investment agree12 ment.

13 ‘‘(2) An individual described in this paragraph

14 is any recipient of aid to families with dependent

15 children other than—

16 ‘‘(A) a dependent child;

17 ‘‘(B) a parent of a child who is less than

18 6 months of age, but if both parents are living

19 in the child’s home, only one parent shall be ex20 empt from entering into the agreement;

21 ‘‘(C) an individual who is employed for 30

22 or more hours per week;

23 ‘‘(D) an individual who is of advanced age;
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1 ‘‘(E) for an initial deferment period to be

2 determined by the State, an individual who is ill

3 or incapacitated; and

4 ‘‘(F) for an initial deferment period to be

5 determined by the State, an individual who is

6 needed in the home because of the illness or in7 capacity of another member of the household.

8 ‘‘(3) The State agency shall ensure that—

9 ‘‘(A) any correspondence with an individ10 ual described in paragraph (2) relating to the

11 family investment program (including the initial

12 notice of the requirement to enter into a family

13 investment agreement) shall be in a format

14 which is designed to be easily understandable to

15 such individual;

16 ‘‘(B) the correspondence described in sub17 paragraph (A) shall be designed to be under18 standable to individuals who are not English

19 language speakers; and

20 ‘‘(C) employees of the State agency are

21 readily available to assist individuals in com22 pleting any documents required for participa23 tion in the family investment program.

24 ‘‘(4) The State agency shall establish a dispute

25 resolution procedure for disputes related to partici-
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1 pation in the family investment agreement that pro2 vides the opportunity for a hearing consistent with

3 the hearing requirement under section 482(h).

4 ‘‘(5)(A) A State shall be treated as operating a

5 family investment program in accordance with para6 graph (1) for fiscal years 1996 through 2003 if the

7 State agency enters into family investment agree8 ments with at least the implementation percentage

9 of the applicable population.

10 ‘‘(B) For purposes of subparagraph (A), the

11 implementation percentage is equal to—

12 ‘‘(i) 20 percent in fiscal year 1996;

13 ‘‘(ii) 25 percent in fiscal year 1997;

14 ‘‘(iii) 30 percent in fiscal year 1998;

15 ‘‘(iv) 35 percent in fiscal year 1999;

16 ‘‘(v) 40 percent in fiscal year 2000;

17 ‘‘(vi) 60 percent in fiscal year 2001;

18 ‘‘(vii) 70 percent in fiscal year 2002; and

19 ‘‘(viii) 90 percent in fiscal year 2003.

20 ‘‘(C) For purposes of subparagraph (A), the ap21 plicable population is the average total number of in22 dividuals in the State during the fiscal year who are

23 described in paragraph (2).

24 ‘‘(6)(A) If a State reports that the State has

25 failed to achieve the implementation percentage re-
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1 quired by paragraph (1) for the fiscal year, the Sec2 retary may make recommendations for changes in

3 the State family investment program. The State may

4 elect to follow such recommendations, and shall dem5 onstrate to the Secretary how the State will achieve

6 the required implementation percentage.

7 ‘‘(B) Notwithstanding subparagraph (A), if a

8 State fails to achieve the implementation percentage

9 required by paragraph (5) for 2 consecutive fiscal

10 years, the Secretary may—

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

12 the family investment program; and

13 ‘‘(ii) reduce by 5 percent the amount oth14 erwise payable to the State under paragraph

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

16 section 403(a).’’.

17 SEC. 103. FAMILY INVESTMENT AGREEMENT AND LIMITED

18 BENEFIT PLAN.

19 (a) FAMILY INVESTMENT AGREEMENT.—Section 406

20 (42 U.S.C. 606) is amended by adding at the end the fol21 lowing new subsection:

22 ‘‘(i) The term ‘family investment agreement’ means

23 a social contract between the State and each family receiv24 ing aid to families with dependent children which—
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1 ‘‘(1) outlines the steps a family will take to ob2 tain self-sufficiency;

3 ‘‘(2) specifies a negotiated time-limited period

4 of eligibility for receipt of aid to families with de5 pendent children that is consistent with unique fam6 ily circumstances and is based on a reasonable plan

7 to facilitate the transition of the family to self-suffi8 ciency;

9 ‘‘(3)(A) contains a requirement that each indi10 vidual entering into the agreement (except those de11 termined to need child care assistance but for whom

12 the State does not guarantee such assistance in ac13 cordance with section 402(g)), participate in at least

14 one of the following activities providing such individ15 ual with a significant level of commitment up to the

16 level required for full-time employment:

17 ‘‘(i) Full-time or part-time employment.

18 ‘‘(ii) Job-search activities.

19 ‘‘(iii) Participation in a job opportunities

20 and basic skills training program which meets

21 the requirements of part F.

22 ‘‘(iv) Participation in education or training

23 programs.

24 ‘‘(v) Unpaid community service (subject to

25 the provisions of subparagraph (B)), only as
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1 part of a plan to improve the employability of

2 the individual and leading to the eventual self3 sufficiency of the family.

4 ‘‘(vi) Placement in a community work ex5 perience program in accordance with section

6 482(f).

7 ‘‘(vii) High school completion activities (or

8 the equivalent) for a parent under the age of

9 20; and

10 ‘‘(B)(i) provides that an individual who partici11 pates in unpaid community service under subpara12 graph (A)(v) shall not be required to perform such

13 unpaid community service for a greater number of

14 hours per month than the maximum number of

15 hours an individual may be required to work in any

16 month under the community work experience pro17 gram as determined under section 482(f)(1)(B)(i);

18 ‘‘(ii) requires any sponsor of unpaid community

19 service to comply with the rules described in sub20 sections (b), (c), (d), and (g) of section 484; and

21 ‘‘(iii) provides that an individual’s participation

22 in unpaid community service may not exceed 3

23 months;

24 ‘‘(4) provides each individual entering into the

25 agreement with the supplemental services required
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1 to obtain self-sufficiency and comply with the terms

2 of the family investment agreement, including health

3 care, transportation, child care, education, and

4 training;

5 ‘‘(5) if the State agency and the individual en6 tering into the agreement agree, provides that the

7 individual participate in—

8 ‘‘(A) a substance abuse treatment pro9 gram, or other social service program that the

10 State agency determines necessary to increase

11 the employability of such individual;

12 ‘‘(B) programs and support services to

13 strengthen parenting skills and assure family

14 stability; and

15 ‘‘(C) programs that lead to improved

16 school readiness for preschool children and on17 grade performance for school age children;

18 ‘‘(6) provides that the State agency shall pro19 vide the family with reasonable support and case

20 management in the creation, monitoring, and adap21 tation of a family investment agreement to respond

22 to changes in family circumstances and factors out23 side family control;

24 ‘‘(7) provides that the State agency shall re25 negotiate the family investment agreement—
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1 ‘‘(A) during the period of the agreement,

2 to reflect substantial changes in family cir3 cumstances or needs; and

4 ‘‘(B) at the conclusion of the original

5 agreement, if each individual entering into the

6 agreement has made a good faith effort to com7 ply with the agreement but were unable to

8 reach self-sufficiency because of factors outside

9 of the control of the individual;

10 ‘‘(8) provides that the family will automatically

11 enter into a limited benefit plan (as described in

12 subsection (j)) if an individual who has entered into

13 the family investment agreement fails to comply with

14 the agreement; and

15 ‘‘(9) provides that the agreement shall be in16 valid if the State agency fails to comply with the

17 agreement.

18 (b) LIMITED BENEFIT PLAN.—Section 406 (42

19 U.S.C. 606), as amended by subsection (a), is amended

20 by adding at the end the following new subsection:

21 ‘‘(j) The term ‘limited benefit plan’ means a plan

22 which, notwithstanding any other provision of this title,

23 provides that—

24 ‘‘(1)(A) during the first 3-month period in

25 which a family receives aid under the plan, the fam-
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1 ily shall receive benefits as normally determined

2 under this title;

3 ‘‘(B) during the second 3-month period in

4 which the family receives aid under the plan, the

5 needs of the caretaker relative, any other relative

6 with whom a dependent child is living, and any other

7 individual living in the same home as such relative

8 and the dependent child whose needs are taken into

9 account in making the determination under section

10 402(a)(7), shall not be taken into account in making

11 the determination with respect to the family for pur12 poses of subsection (a)(7) and in the case of a fam13 ily which is eligible by reason of section 407, both

14 parents shall not be taken into account into making

15 such a determination; and

16 ‘‘(C) after the expiration of a 6-month period

17 beginning on the date on which the family enters

18 into the limited benefit plan, the family shall be in19 eligible for benefits under this title and may not re20 apply for such benefits within a 6-month period be21 ginning on the date of such expiration;

22 ‘‘(2) during the duration of a limited benefit

23 plan, a third-party counselor shall inquire as to the

24 well being of the dependent children; and
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1 ‘‘(3) within a 45-day period beginning on the

2 date that the family automatically enters a limited

3 benefit plan by reason of the family investment

4 agreement provision described in subsection (i)(8) or

5 elects to enter a limited benefit plan under section

6 402(j)(1)(B), the family shall have the option to void

7 the limited benefit plan by regaining compliance with

8 the negotiated family investment agreement or if no

9 agreement has been negotiated, negotiate an agree10 ment.’’.

11 SEC. 104. COORDINATION BETWEEN DEPARTMENTS.

12 (a) IN GENERAL.—The Secretary of Health and

13 Human Services, the Secretary of Labor, and the Sec14 retary of Education shall ensure appropriate coordination

15 in the planning, development, and operation of the pro16 grams described in subsection (b) in order to—

17 (1) improve the quality and effectiveness of

18 services provided by the Department of Health and

19 Human Services, the Department of Labor, and the

20 Department of Education;

21 (2) reduce the overlap of such programs; and

22 (3) reduce the administrative costs of such pro23 grams.

24 (b) PROGRAMS DESCRIBED.—The programs de25 scribed in this subsection are as follows:
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1 (1) The family investment program under sec2 tion 402(j) of the Social Security Act (42 U.S.C.

3 602(j)).

4 (2) The JOBS program under part F of title

5 IV of the Social Security Act (42 U.S.C. 681 et

6 seq.).

7 (3) Job training programs.

8 (4) Child care programs.

9 (5) Educational programs.

10 (6) Any other program administered by the De11 partment of Health and Human Services, the De12 partment of Labor, or the Department of Education

13 which has the effect of promoting self-sufficiency

14 among recipients of aid to families with dependent

15 children under title IV of the Social Security Act (42

16 U.S.C. 601 et seq.).

17 SEC. 105. JOBS PROGRAM.

18 (a) REQUIREMENT OF JOBS PARTICIPATION OF

19 PREGNANT INDIVIDUALS.—Section 402(a)(19)(C) (42

20 U.S.C. 602(a)(19)(C)) is amended—

21 (1) by inserting ‘‘or’’ at the end of clause (v);

22 (2) by striking clause (vi); and

23 (3) by redesignating clause (vii) as clause (vi).

24 (b) NO LIMITATION ON LENGTH OF JOB SEARCH

25 PROGRAM.—Section 482(g)(2) (42 U.S.C. 682(g)(2)) is
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1 amended by striking ‘‘402(a)(19)(D) applies’’ through the

2 end of subparagraph (B) and inserting ‘‘402(a)(19)(D)

3 applies.’’.

4 (c) PROTECTION OF EXISTING WORKERS.—

5 (1) NONDISPLACEMENT.—Section 484(c) (42

6 U.S.C. 684(c)) is amended by—

7 (A) by striking ‘‘or’’ at the end of para8 graph (2);

9 (B) by striking the period at the end of

10 paragraph (3) and inserting ‘‘; or’’; and

11 (C) by inserting after paragraph (3) the

12 following new paragraph:

13 ‘‘(4) the employment or assignment of a partici14 pant or the filling of a position if such participant

15 will perform any services or duties, or engage in ac16 tivities, that—

17 ‘‘(A) will supplant the hiring of employed

18 workers;

19 ‘‘(B) are services, duties, or activities with

20 respect to which an individual has recall rights

21 pursuant to a collective bargaining agreement

22 or applicable personnel procedures; or

23 ‘‘(C) had been performed by or were as24 signed to any employee who—
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1 ‘‘(i) is subject to a reduction in force;

2 or

3 ‘‘(ii) has recall rights pursuant to a

4 collective bargaining agreement or applica5 ble personnel procedures.’’.

6 (2) CONCURRENCE OF LOCAL LABOR ORGANIZA7 TION.—Section 484 (42 U.S.C. 684) is amended by

8 adding at the end the following new subsection:

9 ‘‘(g) No work assignment under the program shall

10 be made until the State agency has obtained from an em11 ployer with whom a participant is placed, the written con12 currence of any local labor organization representing em13 ployees of the employer who are engaged in the same or

14 substantially similar work as that proposed to be carried

15 out.’’.

16 (d) GRIEVANCE PROCEDURE.—Section 484(d)(1) (42

17 U.S.C. 684(d)(1)) is amended to read as follows:

18 ‘‘(d)(1)(A) The State shall establish and maintain a

19 grievance procedure for resolving complaints by regular

20 employees or such employees’ representatives that the

21 work assignment of an individual under the program vio22 lates any of the prohibitions described in subsection (c).

23 ‘‘(B) Except for a grievance that alleges fraud or

24 criminal activity, a grievance shall be made not later than
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1 1 year after the date of the alleged occurrence of the event

2 that is the subject of the grievance.

3 ‘‘(C)(i) A hearing conducted under this paragraph on

4 any grievance shall be conducted not later than 30 days

5 after the filing of such grievance.

6 ‘‘(ii) A decision on any such grievance shall be made

7 not later than 60 days after the filing of such grievance.

8 ‘‘(D)(i)(I) In the event of a decision on a grievance

9 that is adverse to the party who filed such grievance, or

10 60 days after the filing of such grievance if no decision

11 has been reached, such party shall be permitted to submit

12 such grievance to binding arbitration before a qualified ar13 bitrator who is jointly selected and independent of the in14 terested parties.

15 ‘‘(II) If the parties cannot agree on an arbitrator, the

16 Governor shall appoint an arbitrator from a list of quali17 fied arbitrators within 15 days after receiving a request

18 for such appointment from one of the parties to the griev19 ance.

20 ‘‘(ii) An arbitration proceeding shall be held not later

21 than 45 days after the request for such arbitration pro22 ceeding, or, if the arbitrator is appointed by the Governor

23 in accordance with clause (i)(II), not later than 30 days

24 after the appointment of such arbitrator.
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1 ‘‘(iii) A decision concerning a grievance shall be made

2 not later than 30 days after the date such arbitration pro3 ceeding begins.

4 ‘‘(iv)(I) Except as provided in subclause (II), the cost

5 of an arbitration proceeding shall be divided evenly be6 tween the parties to the arbitration.

7 ‘‘(II) If a regular employee or such employee’s rep8 resentative prevails under a binding arbitration proceed9 ing, the State agency shall pay the total cost of such pro10 ceeding and the attorneys’ fees of such employee or rep11 resentative.

12 ‘‘(E) Remedies for a grievance filed under this para13 graph include—

14 ‘‘(i) prohibition of the work assignment in the

15 program under this part; and

16 ‘‘(ii)(I) reinstatement of the displaced employee

17 to the position held by such employee prior to dis18 placement;

19 ‘‘(II) payment of lost wages and benefits of the

20 displaced employee;

21 ‘‘(III) reestablishment of other relevant terms,

22 conditions, and privileges of employment of the dis23 placed employee; and

24 ‘‘(IV) such equitable relief as is necessary to

25 make the displaced employee whole.
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1 ‘‘(F) Suits to enforce arbitration awards under this

2 paragraph may be brought in any district court of the

3 United States having jurisdiction of the parties, without

4 regard to the amount in controversy and without regard

5 to the citizenship of the parties.’’.

6 TITLE II—INCREASING WORK

7 AND SELF-SUFFICIENCY

8 Subtitle A—Work Incentives

9 SEC. 201. INCREASE IN WORK EXPENSE DISREGARD.

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

11 is amended by inserting ‘‘, or at the option of the State

12 (on a statewide basis or in a defined area of the State),

13 the greater of the first $90, or up to the first 20 percent

14 of the total of such earned income for such month’’ after

15 ‘‘such month’’.

16 SEC. 202. INCREASE IN EARNED INCOME INCENTIVE.

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

18 U.S.C. 602(a)(8)(A)(iv)) is amended—

19 (1) by striking ‘‘(II)’’; and

20 (2) by inserting ‘‘, or (II) at the option of the

21 State (on a statewide basis or in a defined area of

22 the State), up to one-half of the total of such earned

23 income not disregarded under any other clause of

24 this subparagraph if such amount is greater than
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1 the amount disregarded under subclause (I)’’ before

2 the semicolon at the end.

3 (b) NO TIME LIMITATION.—Section 402(a)(8)(B)

4 (42 U.S.C. 602(a)(8)(B)) is amended to read as follows:

5 ‘‘(B) provide that (with respect to any month)

6 the State agency shall not disregard under clause

7 (ii), (iii), or (iv) of subparagraph (A) any earned in8 come of any one of the individuals specified in sub9 paragraph (A)(ii) if such individual—

10 ‘‘(i) terminated the individual’s employ11 ment or reduced the individual’s earned income

12 without good cause within such period (of not

13 less than 30 days) preceding such month as

14 may be prescribed by the Secretary;

15 ‘‘(ii) refused without good cause, within

16 such period preceding such month as may be

17 prescribed by the Secretary, to accept employ18 ment in which the individual is able to engage

19 which is offered through the public employment

20 offices of the State, or is otherwise offered by

21 an employer if the offer of such employer is de22 termined by the State or local agency admin23 istering the State plan, after notification by the

24 employer, to be a bona fide offer of employ25 ment; or
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1 ‘‘(iii) failed without good cause to make a

2 timely report (as prescribed by the State plan

3 pursuant to paragraph (14)) to the State agen4 cy of earned income received in such month;

5 and’’.

6 SEC. 203. WORK TRANSITION PERIOD.

7 (a) IN GENERAL.—Section 402(a)(8)(A) (42 U.S.C.

8 602(a)(8)(A)) is amended—

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

10 and

11 (2) by inserting after clause (viii) the following

12 new clause:

13 ‘‘(ix) at the option of the State (on a state14 wide basis or in a defined area of the State),

15 may disregard up to the first 4 months of

16 earned income due to new employment of any

17 child or relative receiving aid to families with

18 dependent children, or of any other individual

19 (living in the same home as such relative and

20 child) whose needs are taken into account in

21 making such a determination not disregarded

22 under any other clause of this subparagraph,

23 if—
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1 ‘‘(I) such individual earned less than

2 $1,200 in the 12-month period preceding

3 the new employment; and

4 ‘‘(II) such individual timely reports

5 the earnings to the State agency; and’’.

6 (b) AFDC QUALITY CONTROL.—Section 408(c)(3)

7 (42 U.S.C. 608(c)(3)) is amended—

8 (1) by striking ‘‘or’’ at the end of subparagraph

9 (D);

10 (2) by striking the period at the end of sub11 paragraph (E) and inserting ‘‘; or’’; and

12 (3) by adding at the end the following new sub13 paragraph:

14 ‘‘(F) the State’s reliance on the best infor15 mation available in determining eligibility for

16 the earned income disregard described in sec17 tion 402(a)(8)(A)(ix).’’.

18 SEC. 204. OPTIONAL STATE DISREGARD OF DEPENDENT

19 CHILD’S INCOME.

20 Section 402(a)(8) (42 U.S.C. 602(a)(8)), as amended

21 by section 203(a), is amended—

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

23 (2) by striking the semicolon at the end of

24 clause (ix) and inserting ‘‘; and’’; and
28

•S 736 IS

1 (3) by inserting after clause (ix) the following

2 new clause:

3 ‘‘(x) at the option of the State (on a state4 wide basis or in a defined area of the State),

5 may disregard all or any part of the earned in6 come of a dependent child; and’’.

7 SEC. 205. TRANSITIONAL CHILD CARE PROGRAM.

8 (a) PERMANENT EXTENSION OF PROGRAM.—

9 (1) IN GENERAL.—Paragraph (2) of section

10 304(b) of the Family Support Act of 1988 (42

11 U.S.C. 602 note) is repealed.

12 (2) CONFORMING AMENDMENT.—Section

13 304(b)(1) of the Family Support Act of 1988 (42

14 U.S.C. 602 note) is amended by striking ‘‘(1)’’.

15 (b) EXTENSION OF TRANSITIONAL CHILD CARE.—

16 Section 402(g)(1)(A)(iii) (42 U.S.C. 602(g)(1)(A)(iii)) is

17 amended by inserting ‘‘(or, at the option of the State, for

18 a period of 24 months)’’ after ‘‘12 months’’.

19 SEC. 206. INCREASE IN MOTOR VEHICLE LIMIT.

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

21 amended—

22 (1) in clause (i), by striking ‘‘and so much of

23 the family member’s ownership interest in one auto24 mobile as does not exceed such amount as the Sec25 retary may prescribe’’;
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•S 736 IS

1 (2) by striking ‘‘or’’ before ‘‘(iv)’’; and

2 (3) by striking ‘‘; and’’ at the end of clause (iv)

3 and inserting ‘‘, or (v) the greater of so much of the

4 family member’s ownership interest in 1 automobile

5 as does not exceed (I) such amount as the Secretary

6 may prescribe, or (II) at the option of the State (on

7 a statewide basis or in a defined area of the State),

8 an amount not to exceed $3,000, adjusted on Octo9 ber 1 of each year (beginning in 1995) to equal the

10 amount determined under this subclause for the pre11 vious fiscal year plus the product of such amount

12 and the increase in the Consumer Price Index for

13 used vehicles during such fiscal year; and’’.

14 SEC. 207. RETROSPECTIVE BUDGETING PROCEDURES.

15 Section 402(a)(13) (42 U.S.C. 602(a)(13)) is amend16 ed—

17 (1) by striking ‘‘subparagraph (B)’’ in subpara18 graph (A) and inserting ‘‘subparagraphs (B) and

19 (C)’’;

20 (2) by striking ‘‘and’’ at the end of subpara21 graph (A);

22 (3) by adding ‘‘and’’ at the end of subpara23 graph (B); and

24 (4) by adding at the end the following new sub25 paragraph:
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•S 736 IS

1 ‘‘(C) in the case of the termination of a

2 source of income of an individual whose income

3 is taken into account in making a determination

4 under paragraph (7), the State agency shall

5 consider the loss of income in making a deter6 mination regarding the amount of aid, begin7 ning in the first month such loss of income oc8 curs, but only if the termination is timely re9 ported and, in the case of earned income, the

10 individual shows good cause for the termination

11 of employment;’’.

12 Subtitle B—Incentives to Save

13 SEC. 211. INCREASE IN ASSET LIMITS.

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

15 amended in the matter preceding clause (i) by inserting

16 ‘‘(or, at the option of the State (on a statewide basis or

17 in a defined area of the State), exceeds an amount pre18 scribed by the State not to exceed $2,000 for applicant

19 families and $5,000 for recipient families)’’ after ‘‘may de20 termine’’.
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1 SEC. 212. DISREGARD OF INCOME AND RESOURCES DES2 IGNATED FOR EDUCATION, TRAINING, AND

3 EMPLOYABILITY.

4 (a) DISREGARD AS RESOURCE.—Section

5 402(a)(7)(B) (42 U.S.C. 602(a)(7)(B)), as amended by

6 section 206, is amended—

7 (1) by striking ‘‘or’’ before ‘‘(v)’’; and

8 (2) by inserting ‘‘, or (vi) at the option of the

9 State (on a statewide basis or in a defined area of

10 the State), in the case of a family receiving aid

11 under the State plan (and a family not receiving

12 such aid but which received such aid in at least 1

13 of the preceding 4 months or became ineligible for

14 such aid during the preceding 12 months because of

15 excessive earnings), any amount not to exceed

16 $10,000 in a qualified asset account (as such term

17 is defined in section 406(k)) of such family, reduced

18 by the amount (if any) excluded from the resources

19 of the family pursuant to paragraph (46)(A)(i)’’ be20 fore ‘‘; and’’.

21 (b) DISREGARD AS INCOME.—

22 (1) NONRECURRING LUMP SUM EXEMPT FROM

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

24 602(a)(17)) is amended by adding before the semi25 colon at the end the following: ‘‘; at the option of

26 the State (on a statewide basis or in a defined area
32

•S 736 IS

1 of the State), that this paragraph shall not apply to

2 earned or unearned income received in a month on

3 a nonrecurring basis to the extent that such income

4 is placed in a qualified asset account (as defined in

5 section 406(k)) the total amounts in which, after

6 such placement, does not exceed $10,000’’.

7 (2) TREATMENT AS INCOME.—Section

8 402(a)(7) (42 U.S.C. 602(a)(7)) is amended—

9 (A) by striking ‘‘and’’ at the end of sub10 paragraph (B);

11 (B) by striking the semicolon at the end of

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

13 (C) by adding at the end the following new

14 subparagraph:

15 ‘‘(D) shall treat as income any distribu16 tions from a qualified asset account (as defined

17 in section 406(k)(1)) which do not meet the

18 definition of a qualified distribution under sec19 tion 406(k)(2);’’.

20 (c) QUALIFIED ASSET ACCOUNTS.—Section 406 (42

21 U.S.C. 606), as amended by section 103, is amended by

22 adding at the end the following new subsection:

23 ‘‘(k)(1) The term ‘qualified asset account’ means a

24 mechanism approved by the State (such as individual re25 tirement accounts, escrow accounts, or savings bonds) that
33

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1 allows savings of a family receiving aid to families with

2 dependent children to be used for qualified distributions.

3 ‘‘(2) The term ‘qualified distributions’ means dis4 tributions for expenses directly related to 1 or more of

5 the following purposes:

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

7 at any education or training program.

8 ‘‘(B) The improvement of the employability (in9 cluding self-employment) of a member of the family

10 (such as through the purchase of an automobile).

11 ‘‘(C) The purchase of a home for the family.

12 ‘‘(D) A change of the family residence.’’.

13 SEC. 213. DISREGARD OF INTEREST INCOME.

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

15 amended by sections 203(a) and 204, is amended—

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

17 and

18 (2) by inserting after clause (x) the following

19 new clause:

20 ‘‘(xi) at the option of the State (on a state21 wide basis or in a defined area of the State),

22 may disregard all interest income of any child

23 or relative applying for or receiving aid to fami24 lies with dependent children, or of any other in25 dividual (living in the same home as such rel-
34

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1 ative and child) whose needs are taken into ac2 count in making such a determination; and’’.

3 Subtitle C—Microenterprise Devel4 opment and Other Projects to

5 Create Jobs

6 SEC. 221. DISREGARD OF INCOME AND RESOURCES RELAT7 ED TO SELF-EMPLOYMENT.

8 (a) STATE PLAN REQUIREMENTS.—Section 402(a)

9 (42 U.S.C. 602(a)) is amended—

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

11 (44);

12 (2) by striking the period at the end of para13 graph (45) and inserting ‘‘; and’’; and

14 (3) by inserting after paragraph (45) the fol15 lowing new paragraph:

16 ‘‘(46) at the option of the State (on a statewide

17 basis or in a defined area of the State), provide that

18 the State agency for a period not to exceed 2

19 years—

20 ‘‘(A)(i) shall not include as a resource of

21 the family of which a child referred to in para22 graph (7)(A) is a member, for purposes of

23 paragraph (7)(B), the lesser of—

24 ‘‘(I) the first $10,000 of the net

25 worth (assets reduced by liabilities with re-
35

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1 spect thereto) of all microenterprises (as

2 defined in section 406(l)(1)) owned, in

3 whole or in part, by the child or by a rel4 ative or other individual referred to in

5 paragraph (7)(A), or

6 ‘‘(II) such net worth attributable to

7 such ownership; and

8 ‘‘(ii) shall take into consideration as

9 earned income of the family of which the child

10 is a member, only the net profits (as defined in

11 section 406(l)(2)) of such microenterprises; and

12 ‘‘(B) shall ensure that caseworkers are

13 able to properly advise recipients of aid under

14 the State plan of the option of microenterprise

15 as a legitimate route toward self-sufficiency,

16 and that caseworkers encourage recipients of

17 such aid who are interested in starting a

18 microenterprise to participate in a program de19 signed to assist them in such effort.’’.

20 (b) DEFINITIONS.—Section 406 (42 U.S.C. 606), as

21 amended by sections 103 and 212(c), is amended by add22 ing at the end the following new subsection:

23 ‘‘(l)(1) The term ‘microenterprise’ means a commer24 cial enterprise which has 5 or fewer employees, 1 or more

25 of whom owns the enterprise.
36

•S 736 IS

1 ‘‘(2) The term ‘net profits’ means, with respect to

2 a microenterprise, the gross receipts of the business,

3 minus—

4 ‘‘(A) payments of principal or interest on a loan

5 to the microenterprise;

6 ‘‘(B) transportation expenses;

7 ‘‘(C) inventory costs;

8 ‘‘(D) expenditures to purchase capital equip9 ment;

10 ‘‘(E) cash retained by the microenterprise for

11 future use by the business;

12 ‘‘(F) taxes paid by reason of the business;

13 ‘‘(G) if the business is covered under a policy

14 of insurance against loss—

15 ‘‘(i) the premiums paid for such insurance;

16 and

17 ‘‘(ii) the losses incurred by the business

18 that are not reimbursed by the insurer solely by

19 reason of the existence of a deductible with re20 spect to the insurance policy;

21 ‘‘(H) the reasonable costs of obtaining 1 motor

22 vehicle necessary for the conduct of the business;

23 and

24 ‘‘(I) the other expenses of the business.’’.
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1 SEC. 222. INCLUSION OF MICROENTERPRISE TRAINING

2 AND ACTIVITIES IN THE JOBS PROGRAM.

3 (a) IN GENERAL.—Section 482(d)(1) (42 U.S.C.

4 682(d)(1)) is amended by adding at the end the following

5 new subparagraph:

6 ‘‘(C) The services and activities referred to in sub7 paragraph (A)—

8 ‘‘(i) in the case of a State in which at least 3

9 percent of the adult recipients of aid under the State

10 plan approved under part A (as of the close of the

11 immediately preceding fiscal year) elect to partici12 pate in microenterprise activities, shall include pro13 grams described in paragraph (4); or

14 ‘‘(ii) in the case of a State in which less than

15 3 percent of the adult recipients of such aid (as of

16 such time) elect to participate in microenterprise ac17 tivities, may include programs described in para18 graph (4).’’.

19 (b) MICROENTERPRISE PROGRAMS.—Section 482(d)

20 (42 U.S.C. 682(d)) is amended by adding at the end the

21 following new paragraph:

22 ‘‘(4) The programs described in this paragraph are

23 programs of public and private organizations, agencies,

24 and other entities (including nonprofit and for-profit enti25 ties) to enable such entities to facilitate economic develop26 ment by—
38

•S 736 IS

1 ‘‘(A) providing technical assistance, advice, and

2 business support services (including assistance, ad3 vice, and support relating to business planning, fi4 nancing, marketing, and other microenterprise devel5 opment activities) to owners of microenterprises and

6 persons developing microenterprises; and

7 ‘‘(B) providing general support (such as peer

8 support and self-esteem programs) to owners of

9 microenterprises and persons developing

10 microenterprises.’’.

11 SEC. 223. WAGE SUPPLEMENTATION DEMONSTRATION

12 PROJECTS.

13 (a) IN GENERAL.—The Secretary of Health and

14 Human Services (hereafter in this section referred to as

15 the ‘‘Secretary’’) shall establish demonstration projects for

16 the purpose of developing a wage supplementation pro17 gram under which—

18 (1) certain individuals eligible for aid to fami19 lies with dependent children under title IV of the So20 cial Security Act (42 U.S.C. 601 et seq.) would be

21 given an incentive to work; and

22 (2) the State would use funds available to pay

23 benefits described in paragraph (1) and food stamp

24 benefits under the Food Stamp Act of 1977 (7
39

•S 736 IS

1 U.S.C. 2011 et seq.) to make monthly incentive pay2 ments (in lieu of such benefits) to such individuals.

3 Each such program shall meet the requirements of sub4 section (b).

5 (b) WAGE SUPPLEMENTATION DEMONSTRATION

6 PROJECT.—

7 (1) IN GENERAL.—A demonstration project

8 conducted under this section shall provide the follow9 ing:

10 (A) INCENTIVES TO WORK.—The project

11 shall—

12 (i) require as a condition of participa13 tion in the project that an eligible individ14 ual be employed by a participating em15 ployer;

16 (ii) provide that the State shall make

17 monthly incentive payments to any eligible

18 individual for each month of employment

19 in an amount equal to the benefits de20 scribed in subsection (a)(2) which would

21 otherwise be payable to the individual, de22 termined as of the first day of the first full

23 month of employment of such individual by

24 a participating employer; and
40

•S 736 IS

1 (iii) provide that such payments be in

2 lieu of such benefits.

3 (B) PERIOD OF PARTICIPATION.—A

4 project shall not permit an eligible individual to

5 participate in the demonstration project for a

6 period in excess of the lesser of—

7 (i) an aggregate period of 48 months,

8 or

9 (ii) a period consisting of the number

10 of months in which such individual was

11 employed by a participating employer.

12 (C) INCOME IN EXCESS OF LIMIT.—The

13 project shall set a limit (to be determined by

14 the State) on the monthly income (including

15 payments under subparagraph (A)(ii)) of the

16 family of an eligible individual and shall permit

17 the State to—

18 (i) reduce payments under subpara19 graph (A)(ii) in excess of the limit; or

20 (ii) determine an individual ineligible

21 for participation in the project if such in22 come is in excess of the limit.

23 (2) SPECIAL RULES FOR TREATMENT UNDER

24 FEDERAL PROGRAMS.—Notwithstanding any other

25 provision of law, the following special rules shall
41

•S 736 IS

1 apply to an eligible individual participating in the

2 project:

3 (A) WAGES AS EARNED INCOME.—Wages

4 paid to an eligible individual by a participating

5 employer (but not payments under the project)

6 shall be considered earned income.

7 (B) TREATED AS ELIGIBLES.—Except for

8 purposes of determining eligibility for benefits

9 for which payments under the project are in

10 lieu of, an eligible individual participating in the

11 project shall be treated as eligible—

12 (i) for aid to families with dependent

13 children under part A of title IV of the So14 cial Security Act (42 U.S.C. 601 et seq.);

15 and

16 (ii) for food stamp benefits under the

17 Food Stamp Act of 1977 (7 U.S.C. 2011

18 et seq.) if such individual was otherwise el19 igible for food stamp benefits, determined

20 as of the first day of the first full month

21 of the employment of such individual by an

22 employer.

23 (C) ADDITIONAL CHILD SUPPORT

24 AMOUNTS.—An eligible individual who partici25 pates in the demonstration project shall remain
42

•S 736 IS

1 eligible for the project notwithstanding the re2 ceipt of any amounts paid to the family of the

3 individual under section 457(b)(4)(B) of the

4 Social Security Act (42 U.S.C. 657(b)(4)(B)).

5 (D) HOUSING.—Any wages paid to an eli6 gible individual by a participating employer dur7 ing the period of time that an eligible individual

8 participates in the demonstration project shall

9 not be taken into account in determining—

10 (i) the monthly rent under section

11 3(a) of the United States Housing Act of

12 1937 for any family residing in a dwelling

13 unit assisted under such Act; and

14 (ii) the monthly assistance payment

15 for any family under section 8(o)(2) of

16 such Act.

17 (3) ELIGIBLE INDIVIDUAL AND PARTICIPATING

18 EMPLOYER.—

19 (A) ELIGIBLE INDIVIDUAL.—For purposes

20 of this section, an individual is an eligible indi21 vidual if the individual is in a category of indi22 viduals which the State determines should be el23 igible to participate in the demonstration

24 project, and who would, at the time of place25 ment in the job involved, be eligible for aid to
43

•S 736 IS

1 families with dependent children under an ap2 proved State plan under title IV of the Social

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

4 (B) PARTICIPATING EMPLOYER.—

5 (i) IN GENERAL.—For purposes of

6 this section, an employer is a participating

7 employer, with respect to an eligible indi8 vidual, if the employer provides the State

9 with a written agreement certifying—

10 (I) that the employment of the

11 eligible individual complies with the

12 rules described in subsections (b), (c),

13 (d), and (g) of section 484 of the So14 cial Security Act (42 U.S.C. 684);

15 (II) that the gross wages (as de16 fined in section 209 of the Social Se17 curity Act (42 U.S.C. 609) deter18 mined without regard to any dollar

19 limitation) paid to such eligible indi20 vidual by the employer during any

21 month will not be less than the prod22 uct of—

23 (aa) the greater of the Fed24 eral minimum wage or the appli25 cable State minimum wage, and
44

•S 736 IS

1 (bb) the number of hours

2 worked by such individual;

3 (III) that the employer will not

4 receive any wage subsidy under any

5 other provision of Federal law, includ6 ing part F of title IV of the Social Se7 curity Act with respect to the employ8 ment of such eligible individual; and

9 (IV) that the eligible individual

10 receives the same employer-provided

11 benefits (other than health care bene12 fits) that other employees of the em13 ployer receive.

14 (ii) CONTINUING CERTIFICATION RE15 QUIREMENT.—A participating employer

16 shall be required to submit a monthly re17 port to the State (in a form and in such

18 manner as the State requires) certifying

19 that the employer has complied with the

20 requirements of subclauses (I), (II), (III),

21 and (IV) of clause (i) with respect to an el22 igible individual during the period such in23 dividual participates under the project.

24 (c) DURATION.—A demonstration project under this

25 Act shall be conducted for not more than 5 years (includ-
45

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1 ing any time necessary for final evaluation and reporting).

2 The Secretary may terminate a project if the Secretary

3 determines that the State conducting the project is not

4 in substantial compliance with the terms of the application

5 approved by the Secretary under this section.

6 (d) APPLICATIONS.—

7 (1) IN GENERAL.—Each State desiring to con8 duct a demonstration project under this section shall

9 prepare and submit to the Secretary an application,

10 at such time, in such manner, and containing such

11 information as the Secretary may require, including

12 an explanation of a plan for evaluating the project.

13 (2) APPROVAL OF APPLICATIONS.—A State that

14 submits an application under paragraph (1) may

15 begin a demonstration project under this section—

16 (A) upon approval of such application by

17 the Secretary; or

18 (B) at the end of the 60-day period begin19 ning on the date such application is submitted,

20 unless the Secretary denies the application dur21 ing such period.

22 (3) NOTICE AND COMMENT.—A State shall

23 issue a public notice on the date the State submits

24 an application under paragraph (1) that contains a

25 general description of the proposed demonstration
46

•S 736 IS

1 project. Any interested party may comment on the

2 proposed demonstration project to the State or the

3 Secretary during the 30-day period beginning on the

4 date the public notice is issued.

5 (e) EVALUATIONS.—Each State conducting a dem6 onstration project under this section shall submit to the

7 Secretary an annual and final evaluation that determines

8 the success of the State’s demonstration project under this

9 section in moving people from welfare dependency to self10 sufficiency.

11 (f) FUNDING FOR DEMONSTRATION PROJECTS.—For

12 each State that conducts a demonstration project under

13 this section—

14 (1) the portion of the monthly payments that

15 the State makes to a participant in the project

16 under subsection (b)(1)(A)(ii) that is attributable to

17 aid to families with dependent children under part A

18 of title IV of the Social Security Act (42 U.S.C. 601

19 et seq.) shall be considered expenditures under the

20 State plan for such aid;

21 (2) the expenses incurred by the State in the

22 administration of the demonstration project shall be

23 considered expenditures by the State for administra24 tive costs in operating a program under part F of
47

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1 title IV of the Social Security Act (42 U.S.C. 601

2 et seq.); and

3 (3) the portion of the monthly payments that

4 the State makes to a participant in the project that

5 is attributable to the cash value of food stamp bene6 fits under the Food Stamp Act of 1977 (7 U.S.C.

7 2011 et seq.) shall be considered to be expenditures

8 for food stamp benefits under such Act.

9 (g) MAINTENANCE OF EFFORT.—Any funds available

10 for the activities covered by a demonstration project con11 ducted under this section shall supplement, and shall not

12 supplant, funds that are expended for similar purposes

13 under any State, regional, or local program.

14 SEC. 224. PROJECTS TO EXPAND THE NUMBER OF JOB OP15 PORTUNITIES AVAILABLE TO CERTAIN LOW16 INCOME INDIVIDUALS.

17 (a) IN GENERAL.—Section 505 of the Family Sup18 port Act (42 U.S.C. 1315 note) is amended—

19 (1) in the section heading, by striking ‘‘DEM20 ONSTRATION’’;

21 (2) in subsection (a)—

22 (A) by striking ‘‘in each of the fiscal years

23 1990, 1991, and 1992,’’; and

24 (B) by striking ‘‘not less than 5 nor more

25 than 10’’;
48

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1 (3) in subsections (a), (b), (d), and (g), by

2 striking ‘‘demonstration’’ each place such term ap3 pears;

4 (4) by striking subsections (e) and (f), and re5 designating subsection (g) as subsection (f); and

6 (5) in subsection (f), as redesignated, by strik7 ing ‘‘$6,500,000 for each of fiscal years 1990, 1991,

8 1992, 1993, 1994, 1995, and 1996’’ and inserting

9 ‘‘$25,000,000 for fiscal year 1996 and each subse10 quent fiscal year’’.

11 (b) EFFECTIVE DATE.—The amendments made by

12 subsection (a) shall take effect on the date of the enact13 ment of this Act.

14 TITLE III—IMPROVING STATE

15 FLEXIBILITY

16 SEC. 301. EQUIVALENT TREATMENT OF STEPPARENT IN17 COME AND PARENT INCOME.

18 Section 402(a)(31) (42 U.S.C. 602(a)(31)) is amend19 ed—

20 (1) in subparagraph (A), by inserting ‘‘, or at

21 the option of the State (on a statewide basis or in

22 a defined area of the State), the greater of $90, or

23 the first 20 percent of such total’’ before the comma

24 at the end;
49

•S 736 IS

1 (2) by striking ‘‘and’’ at the end of subpara2 graph (C); and

3 (3) by striking the semicolon at the end of sub4 paragraph (D) and inserting ‘‘, (E) an amount equal

5 to the expenditure for care in such month for a child

6 of the stepparent who is living in the same home as

7 the stepparent, not receiving aid to families for de8 pendent children, and requiring care for such month

9 to the extent that such amount (for each such child)

10 does not exceed $175 (or such lesser amount as the

11 Secretary may prescribe in the case of an individual

12 not engaged in full-time employment, or not em13 ployed throughout the month), or, in the case such

14 child is under age 2, $200, and (F) at the option of

15 the State (on a statewide basis or in a defined area

16 of the State), up to one-half of the total of such

17 earned income not disregarded under any other sub18 paragraph of this paragraph;’’.

19 SEC. 302. AFDC–UP PROGRAM.

20 (a) PERMANENT EXTENSION OF PROGRAM.—Sub21 section (h) of section 401 of the Family Support Act (42

22 U.S.C. 602 note) is repealed.

23 (b) WORK REQUIREMENTS FOR UNEMPLOYED PAR24 ENTS.—
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1 (1) ELIMINATION OF REQUIRED PARTICIPATION

2 OF ONE PARENT IN WORK COMPONENT OF JOBS

3 PROGRAM.—Section 403(l) (42 U.S.C. 603(l)) is

4 amended by striking paragraph (4).

5 (2) REQUIRED PARTICIPATION OF BOTH PAR6 ENTS.—Section 407(b)(2)(A) (42 U.S.C.

7 607(b)(2)(A)) is amended to read as follows:

8 ‘‘(2)(A)(i) In carrying out the program under this

9 section, a State may condition continued eligibility for aid

10 to families with dependent children by reason of the unem11 ployment of either parent, on the participation of both

12 parents in a program established by the State agency

13 which shall include job search activities, counseling, and

14 training services when the State agency determines that

15 such participation is required, except as provided in clause

16 (ii).

17 ‘‘(ii) A parent shall not be subject to the requirement

18 under subparagraph (A), if such parent is employed at

19 least 30 hours per week, is needed in the home to care

20 for a child under 6 months of age, or if the State agency

21 determines the existence of other good cause.’’.

22 (c) UNEMPLOYED PARENT HOUSEHOLDS.—

23 (1) ELIMINATION OF PRINCIPAL EARNER RE24 QUIREMENT.—
51

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1 (A) IN GENERAL.—Section 407 (42 U.S.C.

2 607) is amended—

3 (i) by striking ‘‘of the parent who is

4 the principal earner’’ in subsection (a) and

5 inserting ‘‘of either parent in a home in

6 which both parents of such child are liv7 ing’’;

8 (ii) by striking ‘‘the parent who is the

9 principal earner’’ in subsection

10 (b)(2)(B)(ii)(II) and inserting ‘‘either par11 ent’’;

12 (iii) by striking ‘‘; and’’ at the end of

13 paragraph (3) of subsection (d) and insert14 ing a period; and

15 (iv) by striking paragraph (4) of sub16 section (d).

17 (B) CONFORMING AMENDMENT.—Section

18 402(a)(19)(D) (42 U.S.C. 602(a)(19)(D)) is

19 amended by striking ‘‘the parent who is the

20 principal earner’’ and inserting ‘‘either parent’’.

21 (2) MODIFICATION OF OTHER REQUIRE22 MENTS.—Subparagraph (A) of section 407(b)(1) (42

23 U.S.C. 607(b)(1)) is amended to read as follows:

24 ‘‘(A) subject to paragraph (2), shall require the

25 payment of aid to families with dependent children
52

•S 736 IS

1 with respect to a dependent child as defined in sub2 section (a) when—

3 ‘‘(i) for at least 30 days—

4 ‘‘(I) prior to the receipt of aid, either

5 parent has been employed for less than a

6 monthly cap specified by the State plan

7 (not to exceed 100 hours), and at the time

8 of the application for aid, both parents are

9 employed for less than such monthly cap;

10 or

11 ‘‘(II) after the application for aid, one

12 or both parents are employed for less than

13 the monthly cap established under

14 subclause (I),

15 ‘‘(ii) either such parent has not without

16 good cause, within such period (of not less than

17 30 days) as may be prescribed by the Secretary,

18 refused a bona fide offer of employment or

19 training for employment, and

20 ‘‘(iii) notwithstanding the number of hours

21 either such parent is working after the initial

22 determination of eligibility, such family remains

23 otherwise eligible for payment under this sec24 tion; and’’.
53

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1 SEC. 303. INCREASED PAYMENTS TO STATES.

2 (a) CHANGES TO JOBS PAYMENT FORMULA.—

3 (1) IN GENERAL.—Section 403(l)(1)(A) (42

4 U.S.C. 603(l)(1)(A)) is amended—

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

6 (i);

7 (B) in clause (ii), in the matter preceding

8 subclause (I), by striking ‘‘described in clause

9 (i)’’ and inserting ‘‘described in clause (i) but

10 do not exceed the amount of such expenditures

11 in fiscal year 1995’’;

12 (C) by striking the period at the end of

13 clause (ii) and inserting ‘‘; and’’; and

14 (D) by adding at the end the following new

15 clause:

16 ‘‘(iii) with respect to so much of the expendi17 tures in a fiscal year that exceed the sum of the

18 amounts described in clauses (i) and (ii)—

19 ‘‘(I) 50 percent in the case of expenditures

20 described in clause (ii)(I), and

21 ‘‘(II) in the case of expenditures made by

22 a State in operating such a program for a fiscal

23 year (other than for costs described in

24 subclause (I)), the greater of—

25 ‘‘(aa) 70 percent, or
54

•S 736 IS

1 ‘‘(bb) the Federal medical assistance

2 percentage (as defined in section 1118 in

3 the case of any State to which section

4 1108 applies, or as defined in section

5 1905(b) in the case of any other State).’’.

6 (2) EFFECTIVE DATE.—The amendments made

7 by paragraph (1) shall apply with respect to pay8 ments made on and after October 1, 1995.

9 (b) INCREASE IN JOBS PROGRAM AUTHORIZA10 TION.—Section 403(k)(3) (42 U.S.C. 603(k)(3)) is

11 amended—

12 (1) by striking ‘‘and’’ at the end of subpara13 graph (E);

14 (2) by striking subparagraph (F); and

15 (3) by inserting after subparagraph (E) the fol16 lowing new subparagraphs:

17 ‘‘(F) $1,250,000,000 in the case of fiscal year

18 1996,

19 ‘‘(G) $1,500,000,000 in the case of fiscal year

20 1997,

21 ‘‘(H) $2,000,000,000 in the case of fiscal year

22 1998,

23 ‘‘(I) $2,500,000,000 in the case of fiscal year

24 1999, and
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1 ‘‘(J) $3,000,000,000 in the case of fiscal year

2 2000.’’.

3 (c) INCREASE IN CHILD CARE PAYMENT FOR4 MULA.—

5 (1) INCREASED PERCENTAGE.—Section

6 402(g)(3)(A)(i) (42 U.S.C. 602(g)(3)(A)(i)) is

7 amended to read as follows:

8 ‘‘(3)(A)(i) In the case of expenditures in any fiscal

9 year for child care pursuant to paragraph (1)(A) by any

10 State to which section 1108 does not apply, the applicable

11 rate for purposes of section 403(a) shall be—

12 ‘‘(I) with respect to so much of such expendi13 tures as does not exceed the State’s expenditures in

14 the fiscal year 1995, the Federal medical assistance

15 percentage (as defined in section 1905(b)), and

16 ‘‘(II) with respect to so much of such expendi17 tures as exceed the amount described in subclause

18 (I), the sum of—

19 ‘‘(aa) the Federal medical assistance per20 centage (as defined in section 1905(b)), and

21 ‘‘(bb) one-half of the difference between

22 100 percent and such Federal medical assist23 ance percentage.’’
56

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1 (2) EFFECTIVE DATE.—The amendments made

2 by paragraph (1) shall apply with respect to pay3 ments made on and after October 1, 1995.

4 SEC. 304. OPTIONAL ASSESSMENT, MONITORING, AND

5 EVALUATION.

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

7 section 221(a), is amended—

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

9 (45);

10 (2) by striking the period at the end of para11 graph (46) and inserting ‘‘; and’’; and

12 (3) by inserting after paragraph (46) the fol13 lowing new paragraph:

14 ‘‘(47) at the option of the State (on a statewide

15 basis or in a defined area of the State), provide that

16 the State agency (in order to increase the percentage

17 of families moving from welfare to self-sufficiency)—

18 ‘‘(A) shall conduct an assessment, in con19 sultation with State and local elected officials,

20 current recipients of aid to families with de21 pendent children, recipients of community-based

22 service systems, and individuals with expertise

23 in business, education, child welfare, juvenile

24 justice, mental health, substance addiction,

25 housing, and labor—
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1 ‘‘(i) of the barriers which families that

2 receive aid to families with dependent chil3 dren face in achieving self-sufficiency, in4 cluding noneconomic barriers such as fam5 ily functions, parenting capacity, child de6 velopment, housing, substance abuse, and

7 mental illness;

8 ‘‘(ii) of the capacity within the State

9 to provide employment opportunities to

10 families that receive aid to families with

11 dependent children and to address other

12 barriers such families face to achieving

13 self-sufficiency; and

14 ‘‘(iii) of the number and skills of

15 workers needed to develop the family in16 vestment program under paragraph (29),

17 monitor progress, and adapt goals to meet

18 new challenges;

19 ‘‘(B) shall establish a system to monitor

20 and evaluate both the economic gains related to

21 employment of individuals in households receiv22 ing aid to families with dependent children and

23 the social, health, educational, and developmen24 tal impact on children in such households that
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1 result from efforts to achieve self-sufficiency;

2 and

3 ‘‘(C) shall establish a system to determine

4 the number of individuals who achieve self-suffi5 ciency through the family investment program

6 under paragraph (29) and the rate of recidi7 vism.’’.

8 SEC. 305. OPTIONAL TIMELY PREVENTIVE HEALTH CARE

9 FOR CHILDREN.

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

11 sections 221(a) and 304, is amended—

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

13 (46);

14 (2) by striking the period at the end of para15 graph (47) and inserting ‘‘; and’’; and

16 (3) by inserting after paragraph (47) the fol17 lowing new paragraph:

18 ‘‘(48) at the option of the State, provide that

19 (unless the State agency provides the Secretary with

20 adequate certification that the care described in sub21 paragraph (A)(i)(I) is not accessible in the area in

22 which a family resides)—

23 ‘‘(A)(i) the State shall decrease the

24 amount of aid paid to a family under this part

25 (determined without regard to subparagraph
59

•S 736 IS

1 (B)) by a percentage amount determined appro2 priate by the Secretary beginning in the month

3 following any month in which the State agency

4 has failed to receive—

5 ‘‘(I) written verification that each

6 child in the family under 6 years of age

7 has been immunized and has received well8 baby and well-child care in accordance with

9 guidelines issued by the Surgeon General

10 of the Public Health Service; or

11 ‘‘(II) notice of a medical justification

12 that would exempt the child or children

13 from receiving such care; and

14 ‘‘(ii) the State shall end the reduction of

15 payment under clause (i) beginning in the

16 month following the month in which the State

17 agency receives the required verification; and

18 ‘‘(B) aid under the plan to a family shall

19 be increased by a bonus payment equal to the

20 percentage amount determined by the Secretary

21 under subparagraph (A) in the month following

22 a month in which the State agency receives ver23 ification that each such child has received the

24 immunizations and care described in subpara25 graph (A)(i).’’.
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1 TITLE IV—COMBATING TEENAGE

2 PREGNANCY

3 SEC. 401. SUPERVISED LIVING ARRANGEMENTS FOR MI4 NORS.

5 Section 402(a)(43) (42 U.S.C. 602(a)(43)) is amend6 ed—

7 (1) in subparagraph (A)(i), by inserting ‘‘reside

8 in a place of residence maintained by another re9 sponsible adult as such adult’s own home,’’ after

10 ‘‘own home,’’; and

11 (2) by amending subparagraph (B)(iii) to read

12 as follows:

13 ‘‘(iii) the State agency determines

14 that compliance with the requirements of

15 subparagraph (A) would jeopardize the

16 physical or emotional health or safety of

17 the individual or dependent child;’’.

18 SEC. 402. OPTIONAL REQUIREMENT OF TEENAGE PARENTS

19 TO STAY IN SCHOOL.

20 Section 402(a)(19)(E)(i) (42 U.S.C.

21 602(a)(19)(E)(i)) is amended to read as follows:

22 ‘‘(i) at the option of the State, in the

23 case of a custodial parent who has not at24 tained 20 years of age, does not have a

25 high school diploma (or its equivalent), and
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1 is required to participate in the program

2 under part F, the State shall require such

3 parent to participate in an educational ac4 tivity; and’’.

5 SEC. 403. ADDITIONAL AUTHORIZATION OF PUBLIC

6 HEALTH SERVICE ACT TITLE X FAMILY PLAN7 NING GRANTS TO COMBAT TEENAGE PREG8 NANCY.

9 (a) IN GENERAL.—Section 1001(d) of the Public

10 Health Service Act (42 U.S.C. 300a(d)) is amended by

11 adding at the end the following new sentence: ‘‘In addition

12 to any other amounts appropriated under title X, for the

13 purpose of expanding efforts to combat teenage preg14 nancy, there are authorized to be appropriated

15 $100,000,000 for the fiscal year ending September 30,

16 1996, and for each subsequent fiscal year.’’.

17 (b) EFFECTIVE DATE.—The amendment made by

18 subsection (a) shall take effect on the date of the enact19 ment of this Act.
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1 TITLE V—IMPROVING CHILD

2 SUPPORT COLLECTION

3 Subtitle A—Improvements in the

4 Collection of Child Support

5 SEC. 501. TRANSMISSION AND ASSIGNMENT OF CERTAIN

6 CHILD SUPPORT ORDERS TO THE IRS.

7 Section 466(a) (42 U.S.C. 666(a)) is amended by in8 serting after paragraph (11) the following new paragraph:

9 ‘‘(12)(A) Procedures which require any State

10 court or administrative agency that issues or modi11 fies (or has issued or modified) a child support order

12 (including an order for the payment of past-due sup13 port) to transmit a copy of the order to the Internal

14 Revenue Service upon the completion of a 12-month

15 period during which less than 50 percent of the

16 court-ordered child support amount for such period

17 has been paid.

18 ‘‘(B) Procedures which—

19 ‘‘(i) require any individual with the right

20 to collect child support pursuant to an order is21 sued or modified in the State (whether before

22 or after the effective date of this paragraph) to

23 be presumed to have assigned to the Internal

24 Revenue Service the right to collect such sup25 port (including any past-due support) pursuant
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1 to subparagraph (A), unless the individual af2 firmatively elects to retain such right at any

3 time; and

4 ‘‘(ii) allow any individual who has made

5 the election referred to in clause (i) to rescind

6 or revive such election at any time.’’.

7 SEC. 502. COLLECTION OF CHILD SUPPORT BY INTERNAL

8 REVENUE SERVICE.

9 (a) IN GENERAL.—Chapter 77 of the Internal Reve10 nue Code of 1986 (relating to miscellaneous provisions)

11 is amended by adding at the end the following new section:

12 ‘‘SEC. 7524. COLLECTION OF CHILD SUPPORT.

13 ‘‘(a) IN GENERAL.—The Secretary shall establish a

14 program to collect child support (including past-due sup15 port) pursuant to child support orders which are assigned

16 to the Internal Revenue Service under section 466(a)(12)

17 of the Social Security Act.

18 ‘‘(b) USE OF WAGE WITHHOLDING, ETC.—Such pro19 gram shall provide for the collection of child support re20 quired to be paid for any period through increases in wage

21 withholding under chapter 24 and estimated tax payments

22 under section 6654 during such period. Amounts required

23 to be paid through such withholding and payments shall

24 be treated as tax for purposes for this subtitle.

25 ‘‘(c) ANNUAL RECKONING OF OBLIGATION.—
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1 ‘‘(1) IN GENERAL.—The entire amount of child

2 support required to be paid by any individual to the

3 Internal Revenue Service during any taxable year

4 shall be paid—

5 ‘‘(A) not later than the last date (deter6 mined without regard to extensions) prescribed

7 for filing such individual’s return of tax im8 posed by chapter 1 for such taxable year, and

9 ‘‘(B)(i) if such return is filed not later

10 than such date, with such return, or

11 ‘‘(ii) in any case not described in subpara12 graph (A), in such manner as the Secretary

13 may by regulations prescribe.

14 ‘‘(2) CREDIT FOR PERIODIC PAYMENTS.—The

15 amount required to be paid under paragraph (1)

16 shall be reduced by the aggregate payments of child

17 support made under subsection (b) by such individ18 ual through increases in wage withholding and esti19 mated tax payments.

20 ‘‘(d) FAILURE TO PAY AMOUNT OWING.—If an indi21 vidual fails to pay the full amount required to be paid on

22 or before the last date described in subsection (c)(1), the

23 Secretary shall assess and collect the unpaid amount in

24 the same manner, with the same powers, and subject to

25 the same limitations applicable to a tax imposed by sub-
65

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1 title C the collection of which would be jeopardized by

2 delay, except that—

3 ‘‘(1) for such purposes, paragraphs (4), (6),

4 and (8) of section 6334(a) (relating to property ex5 empt from levy) shall not apply, and

6 ‘‘(2) there shall be exempt from levy so much

7 of the salary, wages, or other income of an individ8 ual as is being withheld therefrom in garnishment

9 pursuant to a judgment entered by a court of com10 petent jurisdiction for the support of the individual’s

11 minor children.

12 ‘‘(e) COLLECTIONS DISPERSED TO INDIVIDUAL

13 SPECIFIED IN ORDER.—

14 ‘‘(1) IN GENERAL.—Except as provided in para15 graph (2), amounts collected under this section pur16 suant to any child support order shall be paid to the

17 individual entitled to such amounts under such order

18 as quickly as possible. Any penalties and interest

19 collected with respect to such amounts also shall be

20 paid to such individual.

21 ‘‘(2) FAMILIES RECEIVING STATE ASSIST22 ANCE.—In the case of an individual with respect to

23 whom—

24 ‘‘(A) an assignment of child support pay25 ments to a State under section 402(a)(26) or
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1 471(a)(17) of the Social Security Act is in ef2 fect, or

3 ‘‘(B) an application for State assistance

4 under section 454(6) is in effect,

5 amounts collected under this section shall be paid to

6 such State pursuant to section 457 of such Act.

7 ‘‘(f) COORDINATION WITH UNDERPAYMENT PROVI8 SIONS.—If the Secretary is collecting—

9 ‘‘(1) unpaid child support pursuant to an as10 sessment under this section, and

11 ‘‘(2) unpaid tax pursuant to an assessment

12 under section 6203,

13 all amounts collected shall be treated as collected pursuant

14 to the assessment under this section to the extent of the

15 amount of such unpaid child support.

16 ‘‘(g) LIMITATION ON JUDICIAL REVIEW.—No court

17 of the United States shall have jurisdiction to hear any

18 action, whether legal or equitable, brought to restrain or

19 review any assessment or collection authorized by this sec20 tion, nor shall any such assessment or collection be subject

21 to review by the Secretary in an administrative proceeding.

22 This subsection shall not preclude any legal, equitable, or

23 administrative action against the State by an individual

24 in any State court or before any State agency to determine

25 his liability for any amount assessed against him and col-
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1 lected, or to recover any such amount collected from him,

2 under this section.

3 ‘‘(h) REGULATIONS.—The Secretary shall prescribe

4 such regulations as may be appropriate to carry out the

5 purposes of this section.’’.

6 (b) ESTIMATE OF INCREASED INTERNAL REVENUE

7 FUNDING.—Within 1 year of the date of the enactment

8 of this Act, the Secretary of the Treasury shall submit

9 to the Congress an estimate of the additional cost per fis10 cal year for administering the program described in sec11 tion 7524 of the Internal Revenue Code of 1986 (as added

12 by this section).

13 (c) CLERICAL AMENDMENT.—The table of sections

14 for chapter 77 of the Internal Revenue Code of 1986 is

15 amended by adding at the end the following new item:

‘‘Sec. 7524. Collection of child support.’’

16 SEC. 503. OPTIONAL PUBLICATION OF DELINQUENT CHILD

17 SUPPORT OBLIGORS.

18 Section 454 (42 U.S.C. 654) is amended—

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

20 (23);

21 (2) by striking the period at the end of para22 graph (24) and inserting ‘‘; and’’; and

23 (3) by inserting after paragraph (24) the fol24 lowing new paragraph:
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1 ‘‘(25) at the option of the State, provide that

2 with respect to any child support order enforced by

3 the State under this part in which no payment has

4 been made during a preceding 3-month period, the

5 State make available for publication on a semiannual

6 basis a listing of all such orders by name of the sup7 port obligor, verified city and State address of such

8 obligor, and any other information deemed appro9 priate by the State, and publicize the existence of

10 such listing to such support obligors.’’.

11 SEC. 504. OPTIONAL STATE LAW AUTHORIZING SUSPEN12 SION OF LICENSES.

13 Section 466(a) (42 U.S.C. 666(a)), as amended by

14 section 501, is amended by inserting after paragraph (12)

15 the following new paragraph:

16 ‘‘(13) At the option of the State, procedures

17 under which the State has (and uses in appropriate

18 cases) authority (subject to appropriate due process

19 safeguards) to withhold or suspend, or to restrict the

20 use of driver’s licenses, professional and occupational

21 licenses, and recreational licenses of individuals

22 owing overdue child support or failing, after receiv23 ing appropriate notice, to comply with subpoenas or

24 warrants relating to paternity or child support pro25 ceedings.’’.
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1 SEC. 505. OPTIONAL COMMUNITY SERVICE REQUIREMENT

2 FOR DELINQUENT CHILD SUPPORT OBLI3 GORS.

4 Section 454 (42 U.S.C. 654), as amended by section

5 503, is amended—

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

7 (24);

8 (2) by striking the period at the end of para9 graph (25) and inserting ‘‘; and’’; and

10 (3) by inserting after paragraph (25) the fol11 lowing new paragraph:

12 ‘‘(26) at the option of the State, provide that

13 with respect to any child support order enforced by

14 the State under this part in which no payment has

15 been made during a preceding 3-month period, the

16 State require that the support obligor participate in

17 a community service program to be determined by

18 the State.’’.

19 SEC. 506. OPTIONAL STATE LAWS CONCERNING MODIFICA20 TION OF CHILD SUPPORT ORDERS.

21 Section 466(a)(10) (42 U.S.C. 666(a)(10)) is amend22 ed—

23 (1) by redesignating subparagraph (C) as sub24 paragraph (E) and inserting after subparagraph (B)

25 the following new subparagraphs:
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1 ‘‘(C)(i) At the option of the State, proce2 dures to ensure that, beginning October 1,

3 1999 (or such earlier date as the State may se4 lect), the State agency (or, at the option of the

5 State, the local agency) reviews and adjusts, in

6 accordance with guidelines established pursuant

7 to section 467(a), judicial and administrative

8 child support orders under which (subject to

9 clauses (ii) and (iii)) the order—

10 ‘‘(I) is to be reviewed not later than

11 36 months after the establishment of the

12 order or the most recent adjustment of (or

13 determination not to adjust) such order;

14 and

15 ‘‘(II) at State option may not be re16 viewed during a minimum period estab17 lished by the State following the establish18 ment or most recent review of the order.

19 ‘‘(ii) The requirement of clause (i)(I) shall

20 not apply in any case where—

21 ‘‘(I) the State has determined, in ac22 cordance with regulations of the Secretary,

23 that such a review would not be in the best

24 interests of the child; or
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•S 736 IS

1 ‘‘(II) both parents have been informed

2 of the modified support amount that would

3 be imposed under the guidelines and have

4 declined such modification in writing.

5 ‘‘(iii) The State shall provide for review of

6 a child support order upon the request of either

7 parent, notwithstanding the requirement of

8 clause (i)(II), whenever, subsequent to the es9 tablishment or most recent review—

10 ‘‘(I) either parent’s income has

11 changed by more than 20 percent, or

12 ‘‘(II) other substantial changes have

13 occurred in either parent’s circumstances.

14 ‘‘(D) AMOUNT OF MODIFICATION BASED

15 ON GUIDELINES.—Procedures under which sup16 port orders reviewed in accordance with sub17 paragraph (C) must be adjusted in accordance

18 with the guidelines established pursuant to sec19 tion 467(a), without a requirement for any

20 other change in circumstances (except that the

21 State may refuse to modify an order in any

22 case where the change in the support amount,

23 if so modified, would not exceed a threshold

24 percentage (which may not be greater than 10

25 percent)).’’;
72

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1 (2) in subparagraph (E), as redesignated—

2 (A) in the matter preceding clause (i), by

3 striking ‘‘this part—’’ and inserting ‘‘this part,

4 in accordance with State due process require5 ments—’’;

6 (B) in clause (i), by striking ‘‘, at least 30

7 days before the commencement of such review’’;

8 and

9 (C) in clause (iii), by striking ‘‘not less

10 than 30 days’’ and inserting ‘‘a reasonable

11 time’’.

12 Subtitle B—Improvements in

13 Paternity Establishment

14 SEC. 511. OPTIONAL STATE LAWS CONCERNING PATERNITY

15 ESTABLISHMENT.

16 (a) STATE LAWS REQUIRED.—

17 (1) ESTABLISHMENT PROCESS AVAILABLE

18 FROM BEFORE BIRTH UNTIL AGE 18.—Section

19 466(a)(5)(A) (42 U.S.C. 666(a)(5)(A)) is amend20 ed—

21 (A) by moving clause (ii) two ems to the

22 right; and

23 (B) by adding after and below clause (ii)

24 the following new clause:
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1 ‘‘(iii) At the option of the State, procedures

2 which permit the initiation of proceedings to estab3 lish paternity prior to the birth of the child con4 cerned.’’.

5 (2) PROCEDURES CONCERNING GENETIC TEST6 ING.—Section 466(a)(5)(B) (42 U.S.C.

7 666(a)(5)(B)) is amended—

8 (A) by striking ‘‘(B)’’ and inserting

9 ‘‘(B)(i)’’;

10 (B) in clause (i), as redesignated, by in11 serting before the period ‘‘, where, at the option

12 of the State, such request is supported by a

13 sworn statement by such party setting forth

14 facts establishing a reasonable possibility of the

15 requisite sexual contact’’; and

16 (C) by inserting after and below clause (i),

17 as redesignated, the following new clause:

18 ‘‘(ii) At the option of the State, procedures

19 which require the State agency, in any case in which

20 such agency orders genetic testing—

21 ‘‘(I) to pay costs of such tests, subject to

22 recoupment (where the State so elects) from the

23 putative father if paternity is established; and

24 ‘‘(II) to obtain additional testing in any

25 case where an original test result is disputed,
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1 upon request and advance payment by the dis2 puting party.’’.

3 (3) VOLUNTARY ACKNOWLEDGMENT PROCE4 DURE.—Section 466(a)(5)(C) (42 U.S.C.

5 666(a)(5)(C)) is amended to read as follows:

6 ‘‘(C) At the option of the State, procedures for

7 a simple civil process for voluntarily acknowledging

8 paternity under which—

9 ‘‘(i) the benefits, rights, and responsibil10 ities of acknowledging paternity are explained

11 to unwed parents;

12 ‘‘(ii) due process safeguards are afforded;

13 and

14 ‘‘(iii) hospitals and other health care facili15 ties providing inpatient or outpatient maternity

16 and pediatric services are required, as a condi17 tion of participation in the State program under

18 title XIX—

19 ‘‘(I) to explain to unwed parents the

20 matters specified in clause (i);

21 ‘‘(II) to make available the voluntary

22 acknowledgment procedure required under

23 this subparagraph; and

24 ‘‘(III) in the case of hospitals provid25 ing maternity services—
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•S 736 IS

1 ‘‘(aa) to have facilities for obtain2 ing blood or other genetic samples

3 from the mother, putative father, and

4 child for genetic testing;

5 ‘‘(bb) to inform the mother and

6 putative father of the availability of

7 such testing (at their expense); and

8 ‘‘(cc) to obtain such samples

9 upon request of both such individ10 uals;’’.

11 (4) LEGAL STATUS OF ACKNOWLEDGMENT.—

12 Section 466(a)(5)(D) (42 U.S.C. 666(a)(5)(D)) is

13 amended to read as follows:

14 ‘‘(D) At the option of the State, procedures

15 under which—

16 ‘‘(i) a voluntary acknowledgment of pater17 nity creates, at the State’s option, either—

18 ‘‘(I) a conclusive presumption of pa19 ternity, or

20 ‘‘(II) a rebuttable presumption which

21 becomes a conclusive presumption within

22 one year, unless rebutted or invalidated by

23 an intervening determination which

24 reaches a contrary conclusion;
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•S 736 IS

1 ‘‘(ii) notwithstanding clause (i), at the op2 tion of the State and upon the request of a

3 party, a determination of paternity based on an

4 acknowledgment may be vacated on the basis of

5 new evidence, the existence of fraud, or the best

6 interests of the child; and

7 ‘‘(iii) a voluntary acknowledgment of pater8 nity is admissible as evidence of paternity, and

9 as a basis for seeking a support order, without

10 requiring any further proceedings to establish

11 paternity.’’.

12 (5) BAR ON ACKNOWLEDGMENT RATIFICATION

13 PROCEEDINGS.—Section 466(a)(5)(E) (42 U.S.C.

14 666(a)(5)(E)) is amended to read as follows:

15 ‘‘(E) At the option of the State, procedures

16 under which no judicial or administrative pro17 ceedings are required or permitted to ratify an

18 unchallenged acknowledgment of paternity.’’.

19 (6) ADMISSIBILITY OF GENETIC TESTING RE20 SULTS.—Section 466(a)(5)(F) (42 U.S.C.

21 666(a)(5)(F)) is amended to read as follows:

22 ‘‘(F) At the option of the State, procedures re23 quiring—
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•S 736 IS

1 ‘‘(i) that the State admit into evidence, for

2 purposes of establishing paternity, results of

3 any genetic test that is—

4 ‘‘(I) of a type generally acknowledged,

5 by accreditation bodies designated by the

6 Secretary, as reliable evidence of paternity;

7 and

8 ‘‘(II) performed by a laboratory ap9 proved by such an accreditation body;

10 ‘‘(ii) that any objection to genetic testing

11 results must be made in writing not later than

12 a specified number of days before any hearing

13 at which such results may be introduced into

14 evidence (or, at State option, not later than a

15 specified number of days after receipt of such

16 results); and

17 ‘‘(iii) that, if no objection is made, the test

18 results are admissible as evidence of paternity

19 without the need for foundation testimony or

20 other proof of authenticity or accuracy.’’.

21 (7) ADDITIONAL STATE LAWS REQUIRED.—Sec22 tion 466(a)(5) (42 U.S.C. 666(a)(5)) is amended by

23 adding at the end the following new subparagraphs:
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•S 736 IS

1 ‘‘(I) At the option of the State, procedures pro2 viding that the parties to an action to establish pa3 ternity are not entitled to jury trial.

4 ‘‘(J) At the option of the State, procedures

5 which require that a temporary order be issued,

6 upon motion by a party, requiring the provision of

7 child support pending an administrative or judicial

8 determination of parentage, where there is clear and

9 convincing evidence of paternity (on the basis of ge10 netic tests or other evidence).

11 ‘‘(K) At the option of the State, procedures

12 under which bills for pregnancy, childbirth, and ge13 netic testing are admissible as evidence without re14 quiring third-party foundation testimony, and shall

15 constitute prima facie evidence of amounts incurred

16 for such services and testing on behalf of the child.

17 ‘‘(L) At the option of the State, procedures

18 under which the tribunal establishing paternity and

19 support has discretion to waive rights to all or part

20 of amounts owed to the State (but not to the moth21 er) for costs related to pregnancy, childbirth, and

22 genetic testing and for public assistance paid to the

23 family where the father cooperates or acknowledges

24 paternity before or after genetic testing.
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1 ‘‘(M) Procedures ensuring that the putative fa2 ther has a reasonable opportunity to initiate a pater3 nity action.’’.

4 (b) TECHNICAL AMENDMENT.—Section 468 (42

5 U.S.C. 668) is amended—

6 (1) in the heading, by striking ‘‘SIMPLE CIVIL

7 PROCESS FOR VOLUNTARILY ACKNOWLEDGING

8 PATERNITY AND’’; and

9 (2) by striking ‘‘a simple civil process for volun10 tarily acknowledging paternity and’’.

11 SEC. 512. OPTIONAL OUTREACH FOR VOLUNTARY PATER12 NITY ESTABLISHMENT.

13 (a) STATE PLAN REQUIREMENT.—Section 454(23)

14 (42 U.S.C. 654(23)) is amended—

15 (1) by inserting ‘‘(A)’’ after ‘‘(23)’’; and

16 (2) by adding at the end the following new sub17 paragraph:

18 ‘‘(B) at the option of the State, publicize

19 the availability and encourage the use of proce20 dures for voluntary establishment of paternity

21 and child support through a variety of means,

22 which—

23 ‘‘(i) include distribution of written

24 materials at health care facilities (includ-
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•S 736 IS

1 ing hospitals and clinics), and other loca2 tions such as schools;

3 ‘‘(ii) may include prenatal programs

4 to educate expectant couples on individual

5 and joint rights and responsibilities with

6 respect to paternity (and may require all

7 expectant recipients of assistance under

8 part A to participate in such prenatal pro9 grams, as an element of cooperation with

10 efforts to establish paternity and child sup11 port); and

12 ‘‘(iii) include, with respect to each

13 child discharged from a hospital after birth

14 for whom paternity or child support has

15 not been established, reasonable followup

16 efforts (including at least one contact of

17 each parent whose whereabouts are known,

18 except where there is reason to believe

19 such followup efforts would put mother or

20 child at risk), providing—

21 ‘‘(I) in the case of a child for

22 whom paternity has not been estab23 lished, information on the benefits of

24 and procedures for establishing pater25 nity; and
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•S 736 IS

1 ‘‘(II) in the case of a child for

2 whom paternity has been established

3 but child support has not been estab4 lished, information on the benefits of

5 and procedures for establishing a

6 child support order, and an applica7 tion for child support services; and’’.

8 (b) ENHANCED FEDERAL MATCHING.—Section

9 455(a)(1)(C) (42 U.S.C. 655(a)(1)(C)) is amended—

10 (1) by inserting ‘‘(i)’’ before ‘‘laboratory costs’’;

11 and

12 (2) by inserting ‘‘, and (ii) costs of outreach

13 programs designed to encourage voluntary acknowl14 edgment of paternity’’ before the semicolon at the

15 end.

16 (c) EFFECTIVE DATES.—(1) The amendments made

17 by subsection (a) shall become effective October 1, 1996.

18 (2) The amendments made by subsection (b) shall be

19 effective with respect to calendar quarters beginning on

20 and after October 1, 1995.

21 SEC. 513. PENALTY FOR FAILURE TO ESTABLISH PATER22 NITY PROMPTLY.

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

24 (1) in subsection (a), by striking ‘‘1958—’’ and

25 inserting ‘‘1958 (subject to subsection (i))—’’ ; and
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•S 736 IS

1 (2) by adding after subsection (h) the following

2 new subsection:

3 ‘‘(i)(1) The amounts otherwise payable to a State

4 under subsection (a) for any calendar quarter beginning

5 10 months or more after enactment of this subsection

6 shall be reduced by an amount, determined pursuant to

7 regulations in accordance with paragraph (2), for certain

8 children for whom paternity has not been established.

9 ‘‘(2) The Secretary shall promulgate regulations

10 specifying the formula for the reduction required under

11 this subsection, which formula shall provide for a reduc12 tion in Federal matching payments to a State under this

13 section by an amount equal to the product of—

14 ‘‘(A) the number (after allowing for the toler15 ance level established under paragraph (3)) of chil16 dren born on or after the date 10 months after en17 actment of this provision who are receiving aid

18 under the State plan under part A, whose custodial

19 relatives have, throughout the preceding 12-month

20 period, complied with cooperation requirements for

21 establishing paternity required under the State pro22 gram for establishing paternity operated in accord23 ance with section 454(13) but for whom paternity

24 has not been established;
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•S 736 IS

1 ‘‘(B) the average monthly assistance payment

2 under the State plan under this part; and

3 ‘‘(C) the Federal matching rate applicable to

4 such assistance payment.

5 ‘‘(3)(A) The tolerance level, for purposes of para6 graph (2)(A), shall not be higher than the percentage

7 specified in subparagraph (B) of children in the State de8 scribed in paragraph (1), and may decrease over time to

9 make allowance for a State’s inability to establish pater10 nity in all cases.

11 ‘‘(B) The percentage specified in this paragraph shall

12 be 25 percent for fiscal years 1997 and 1998, 20 percent

13 for fiscal years 1999 and 2000, 15 percent for fiscal years

14 2001 and 2002, and 10 percent for fiscal year 2003 and

15 each succeeding fiscal year.’’.

16 SEC. 514. INCENTIVES TO PARENTS TO ESTABLISH PATER17 NITY.

18 (a) OPTIONAL STATE ACTIVITIES.—Section 455 (42

19 U.S.C. 655) is amended by adding at the end the following

20 new subsection:

21 ‘‘(f)(1) The Secretary, in accordance with regula22 tions, may approve proposals by States to amend State

23 plans under this part to provide for incentive payments

24 to families to encourage paternity establishment.
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•S 736 IS

1 ‘‘(2) Federal financial participation shall be available

2 in accordance with subsection (a) for expenditures by a

3 State pursuant to a plan amendment approved under

4 paragraph (1).’’.

5 (b) DEMONSTRATIONS.—

6 (1) PROJECTS AUTHORIZED.—The Secretary of

7 Health and Human Services shall authorize up to 3

8 States to conduct demonstration projects providing

9 financial incentives to families for establishment of

10 paternity.

11 (2) FEDERAL FUNDING.—

12 (A) IN GENERAL.—Subject to subpara13 graph (B), a State participating in a dem14 onstration under this subsection shall be enti15 tled to Federal payments pursuant to section

16 455(f) of the Social Security Act (42 U.S.C.

17 655(f)) for 90 percent of the payments to fami18 lies under such demonstration.

19 (B) FUNDING LIMITATION.—Total Federal

20 expenditures for demonstrations under this sub21 section shall not exceed $1,000,000.
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1 TITLE VI—SAVINGS PROVISIONS

2 SEC. 601. BLOCK GRANTS TO STATES TO REPLACE CERTAIN

3 FEDERAL ADMINISTRATIVE PAYMENTS.

4 (a) PURPOSE; AUTHORIZATION OF APPROPRIA5 TIONS.—

6 (1) IN GENERAL.—For the purpose of consoli7 dating Federal assistance to States for the adminis8 tration of the programs described in paragraph (2),

9 there are authorized to be appropriated such sums

10 as may be necessary to carry out the purposes of

11 this section.

12 (2) PROGRAMS DESCRIBED.—The programs de13 scribed in this paragraph are the following pro14 grams:

15 (A) The medicaid program under title XIX

16 of the Social Security Act (42 U.S.C. 1396 et

17 seq.).

18 (B) The aid to families with dependent

19 children program under part A of title IV of the

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

21 (C) The food stamp program established

22 under section 4 of the Food Stamp Act of 1977

23 (7 U.S.C. 2013).

24 (b) STATES ENTITLED TO PAYMENT.—
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1 (1) IN GENERAL.—Each State shall be entitled

2 to payment under this section for fiscal year 1996

3 and each fiscal year thereafter in an amount equal

4 to the Federal administrative payment amount de5 termined under subsection (c) to be used for admin6 istering the programs described in subsection (a)(2).

7 (2) RULES FOR MAKING PAYMENTS.—The Sec8 retary of Health and Human Services, in coopera9 tion with the Secretary of Agriculture, shall make

10 payments in accordance with section 6503 of title

11 31, United States Code, to each State in accordance

12 with this subsection.

13 (c) FEDERAL ADMINISTRATIVE PAYMENT

14 AMOUNT.—

15 (1) IN GENERAL.—Subject to paragraph (2),

16 the Federal administrative payment amount deter17 mined under this subsection is an amount equal to

18 the sum of—

19 (A) the amount that the State received

20 under section 16(a) of the Food Stamp Act of

21 1977 (7 U.S.C. 2025(a)) for fiscal year 1995,

22 adjusted pursuant to section 16(c)(1)(A) of

23 such Act;

24 (B) the amount that the State received

25 under section 403(a)(3) of the Social Security
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•S 736 IS

1 Act (42 U.S.C. 603(a)(3)) (relating to pay2 ments to States for administering the aid to

3 families with dependent children program) for

4 fiscal year 1995; and

5 (C) the amount that the State received

6 under paragraphs (2)(A), (3), (4), and (7) of

7 section 1903(a) of the Social Security Act (42

8 U.S.C. 1396b(a)) (relating to payments to

9 States for administering the medicaid program)

10 for fiscal year 1995.

11 (2) PRO RATA REDUCTION IF INSUFFICIENT

12 AMOUNT APPROPRIATED.—If the amount appro13 priated in accordance with subsection (a) for a fiscal

14 year is insufficient to make the payments described

15 in paragraph (1) to all States, the amount to be

16 paid to each State under this subsection shall be re17 duced ratably for such fiscal year.

18 (d) AMOUNTS TO BE USED FOR ADMINISTERING

19 PROGRAMS.—

20 (1) EXPENDITURES.—Payments to a State

21 under this section shall be expended by the State in

22 such fiscal year or in the succeeding fiscal year.

23 (2) ALLOCATION AMONG PROGRAMS.—A State

24 shall have the discretion to allocate the amounts re-
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1 ceived under this section among the programs de2 scribed in subsection (a)(2) in any manner.

3 (e) REPORTS AND AUDITS.—

4 (1) REPORTS.—Each State shall prepare re5 ports on its activities carried out with funds made

6 available under this section. Reports shall be pre7 pared annually, covering the most recently completed

8 fiscal year, and shall be in such form and contain

9 such information as the State finds necessary to pro10 vide an accurate description of such activities, to se11 cure a complete record of the purposes for which

12 funds were spent, and to determine the extent to

13 which funds were spent in a manner consistent with

14 the purposes of this section. The State shall make

15 copies of the reports required by this section avail16 able for public inspection within the State and shall

17 transmit a copy to the Secretary of Health and

18 Human Services. Copies shall also be provided, upon

19 request, to any interested public agency, and each

20 such agency may provide its views on these reports

21 to the congress.

22 (2) AUDITS.—Each State shall, not less than

23 every 2 years, audit its expenditures from amounts

24 received under this section. Such State audits shall

25 be conducted by an entity independent of any agency
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•S 736 IS

1 administering activities funded under this section, in

2 accordance with generally accepted auditing prin3 ciples. Within 30 days following the completion of

4 each audit, the State shall submit a copy of that

5 audit to the legislature of the State and to the Sec6 retary of Health and Human Services. Each State

7 shall repay to the United States amounts ultimately

8 found not to have been expended in accordance with

9 this section, or the Secretary may offset such

10 amounts against any other amount to which the

11 State is or may become entitled under this section.

12 (3) AGREEMENT REGARDING INTERGOVERN13 MENTAL FINANCING.—The provisions of section

14 6503(h) of title 31, United States Code, shall apply

15 to payments made to a State under this section.

16 (f) STATE DEFINED.—For purposes of this section,

17 the term ‘‘State’’ shall include any State, territory, posses18 sion, or Indian tribe that directly received payments under

19 titles IV and XIX of the Social Security Act or the Food

20 Stamp Act of 1977 during the fiscal year preceding the

21 date of the enactment of this Act.

22 (g) CONFORMING AMENDMENTS.—

23 (1) MEDICAID PROGRAM.—Section 1903(a) of

24 the Social Security Act (42 U.S.C. 1396b(a)) is

25 amended—
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1 (A) in paragraph (2), by repealing sub2 paragraph (A);

3 (B) by repealing paragraphs (3), (4), and

4 (7);

5 (C) by inserting ‘‘plus’’ at the end of para6 graph (5);

7 (D) by striking ‘‘; plus’’ at the end of

8 paragraph (6) and inserting a period.

9 (2) AFDC PROGRAM.—Section 403(a) of the

10 Social Security Act (42 U.S.C. 603(a)) is amend11 ed—

12 (A) by striking paragraph (3); and

13 (B) by redesignating paragraph (5) as

14 paragraph (3).

15 (3) FOOD STAMP PROGRAM.—Section 16 of the

16 Food Stamp Act of 1977 (7 U.S.C. 2025) is amend17 ed—

18 (A) in the first sentence of subsection (a),

19 by striking ‘‘pay to each State’’ and all that fol20 lows through ‘‘as well as to’’; and

21 (B) in subsection (c)(1)(A), by striking

22 ‘‘the Secretary shall’’ and all that follows

23 through ‘‘all such administrative costs’’ and in24 serting ‘‘the Federal administrative payment

25 amount determined under section 601(c) of the
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•S 736 IS

1 Welfare to Self-Sufficiency Act of 1995 shall be

2 adjusted by increasing the payment amount by 1

3 percentage point to a maximum of 10 percent’’.

4 (4) EFFECTIVE DATE.—The amendments made

5 by paragraphs (1), (2), and (3) shall take effect on

6 October 1, 1995.

7 SEC. 602. EXTENSION OF DEEMING OF INCOME AND RE8 SOURCES UNDER AFDC, SSI, MEDICAID, AND

9 FOOD STAMP PROGRAMS.

10 (a) IN GENERAL.—Except as provided in subsections

11 (b) and (c), in applying sections 415 and 1621 of the So12 cial Security Act and section 5(i) of the Food Stamp Act

13 of 1977, the period in which each respective section other14 wise applies with respect to an alien shall be extended

15 through the date (if any) on which the alien becomes a

16 citizen of the United States under chapter 2 of title III

17 of the Immigration and Nationality Act.

18 (b) EXCEPTION.—Subsection (a) shall not apply to

19 an alien if—

20 (1) the alien—

21 (A) is a veteran (as defined in section 101

22 of title 38, United States Code) with a dis23 charge characterized as an honorable discharge,
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•S 736 IS

1 (B) is on active duty (other than active

2 duty for training) in the Armed Forces of the

3 United States, or

4 (C) is the spouse or unmarried dependent

5 child of an individual described in subparagraph

6 (A) or (B);

7 (2) the alien is the subject of domestic violence

8 by the alien’s spouse and a divorce between the alien

9 and the alien’s spouse has been initiated through the

10 filing of an appropriate action in an appropriate

11 court; or

12 (3) there has been paid with respect to the self13 employment income or employment of the alien, or

14 of a parent or spouse of the alien, taxes under chap15 ter 2 or chapter 21 of the Internal Revenue Code of

16 1986 in each of 20 different calendar quarters.

17 (c) MEDICAID ELIGIBILITY.—

18 (1) IN GENERAL.—Except as provided in para19 graph (2), subsection (a) shall apply with respect to

20 determinations of eligibility for benefits under part

21 A of title IV of the Social Security Act or under the

22 supplemental income security program under title

23 XVI of such Act insofar as such determinations pro24 vide for eligibility for medical assistance under title

25 XIX of such Act.
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1 (2) IMMUNIZATIONS AND EMERGENCY MEDICAL

2 CONDITIONS.—Subsection (a) shall not apply with

3 respect to determinations of eligibility for benefits

4 under part A of title IV of the Social Security Act

5 or under the supplemental income security program

6 under title XVI of such Act insofar as such deter7 minations provide for eligibility for immunizations

8 and care and services necessary for the treatment of

9 an emergency medical condition (as defined in sec10 tion 1903(v)(3) of such Act (42 U.S.C.

11 1396b(v)(3))) of the alien under title XIX of such

12 Act.

13 (d) EFFECTIVE DATE.—This section shall take effect

14 on October 1, 1995.

15 SEC. 603. REQUIREMENTS FOR SPONSOR’S AFFIDAVITS OF

16 SUPPORT.

17 (a) IN GENERAL.—Title II of the Immigration and

18 Nationality Act is amended by inserting after section 213

19 the following new section:

20 ‘‘REQUIREMENTS FOR SPONSOR’S AFFIDAVIT OF SUPPORT

21 ‘‘SEC. 213A. (a) ENFORCEABILITY.—

22 ‘‘(1) IN GENERAL.—No affidavit of support

23 may be accepted by the Attorney General or by any

24 consular officer to establish that an alien is not ex25 cludable under section 212(a)(4) unless such affida26 vit is executed as a contract—
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•S 736 IS

1 ‘‘(A) which, for not more than 5 years

2 after the date the alien last receives any such

3 cash benefit, is legally enforceable against the

4 sponsor by the Federal Government, by a State,

5 or by any political subdivision of a State, pro6 viding cash benefits under a public cash assist7 ance program (as defined in subsection (f)(2));

8 and

9 ‘‘(B) in which the sponsor agrees to submit

10 to the jurisdiction of any Federal or State court

11 for the purpose of actions brought under sub12 section (e)(2).

13 ‘‘(2) EXPIRATION OF LIABILITY.—Such con14 tract shall only apply with respect to cash benefits

15 described in paragraph (1)(A) provided to an alien

16 before the earliest of the following:

17 ‘‘(A) CITIZENSHIP.—The date the alien be18 comes a citizen of the United States under

19 chapter 2 of title III.

20 ‘‘(B) VETERAN.—The first date the alien

21 is a veteran (as defined in section 101 of title

22 38, United States Code) with a discharge char23 acterized as an honorable discharge.

24 ‘‘(C) PAYMENT OF SOCIAL SECURITY

25 TAXES.—The first date as of which there has
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•S 736 IS

1 been paid with respect to the self-employment

2 income or employment of the alien, or of a par3 ent or spouse of the alien, taxes under chapter

4 2 or chapter 21 of the Internal Revenue Code

5 of 1986 in each of 20 different calendar quar6 ters.

7 ‘‘(3) NONAPPLICATION DURING CERTAIN PERI8 ODS.—Such contract also shall not apply with re9 spect to cash benefits described in paragraph (1)(A)

10 provided during any period in which the alien is—

11 ‘‘(A) on active duty (other than active duty

12 for training) in the Armed Forces of the United

13 States, or

14 ‘‘(B) the spouse or unmarried dependent

15 child of an individual described in paragraph

16 (2)(A) or subparagraph (A) of this paragraph;

17 ‘‘(b) FORMS.—Not later than 90 days after the date

18 of the enactment of this section, the Attorney General, in

19 consultation with the Secretary of State and the Secretary

20 of Health and Human Services, shall formulate an affida21 vit of support consistent with the provisions of this sec22 tion.

23 ‘‘(c) NOTIFICATION OF CHANGE OF ADDRESS.—

24 ‘‘(1) REQUIREMENT.—The sponsor shall notify

25 the Federal Government and the State in which the
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•S 736 IS

1 sponsored alien is currently resident within 30 days

2 of any change of address of the sponsor during the

3 period specified in subsection (a)(1)(A).

4 ‘‘(2) ENFORCEMENT.—Any person subject to

5 the requirement of paragraph (1) who fails to satisfy

6 such requirement shall be subject to a civil penalty

7 of—

8 ‘‘(A) not less than $250 or more than

9 $2,000, or

10 ‘‘(B) if such failure occurs with knowledge

11 that the sponsored alien has received any bene12 fit under any means-tested public benefits pro13 gram, not less than $2,000 or more than

14 $5,000.

15 ‘‘(d) REIMBURSEMENT OF GOVERNMENT EX16 PENSES.—

17 ‘‘(1) REQUEST FOR REIMBURSEMENT.—

18 ‘‘(A) IN GENERAL.—Upon notification that

19 a sponsored alien has received any cash benefits

20 described in subsection (a)(1)(A), the appro21 priate Federal, State, or local official shall re22 quest reimbursement by the sponsor in the

23 amount of such cash benefits.

24 ‘‘(B) REGULATIONS.—The Attorney Gen25 eral, in consultation with the Secretary of
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•S 736 IS

1 Health and Human Services, shall prescribe

2 such regulations as may be necessary to carry

3 out subparagraph (A).

4 ‘‘(2) INITIATION OF ACTION.—If, not later than

5 45 days after requesting reimbursement, the appro6 priate Federal, State, or local agency has not re7 ceived a response from the sponsor indicating a will8 ingness to commence payments, an action may be

9 brought against the sponsor pursuant to the affida10 vit of support.

11 ‘‘(3) FAILURE TO ABIDE BY REPAYMENT

12 TERMS.—If the sponsor fails to abide by the repay13 ment terms established by such agency, the agency

14 may, not later than 60 days after such failure, bring

15 an action against the sponsor pursuant to the affida16 vit of support.

17 ‘‘(4) LIMITATION ON ACTIONS.—No cause of

18 action may be brought under this subsection later

19 than 5 years after the date the alien last received

20 any cash benefit described in subsection (a)(1)(A).

21 ‘‘(f) DEFINITIONS.—For the purposes of this section:

22 ‘‘(1) SPONSOR.—The term ‘sponsor’ means an

23 individual who—
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•S 736 IS

1 ‘‘(A) is a citizen or national of the United

2 States or an alien who is lawfully admitted to

3 the United States for permanent residence;

4 ‘‘(B) is 18 years of age or over; and

5 ‘‘(C) is domiciled in any State.

6 ‘‘(2) PUBLIC CASH ASSISTANCE PROGRAM.—

7 The term ‘public cash assistance program’ means a

8 program of the Federal Government or of a State or

9 political subdivision of a State that provides direct

10 cash assistance for the purpose of income mainte11 nance and in which the eligibility of an individual,

12 household, or family eligibility unit for cash benefits

13 under the program, or the amount of such cash ben14 efits, or both are determined on the basis of income,

15 resources, or financial need of the individual, house16 hold, or unit. Such term does not include any pro17 gram insofar as it provides medical, housing, edu18 cation, job training, food, or in-kind assistance or

19 social services.’’.

20 (b) CLERICAL AMENDMENT.—The table of contents

21 of such Act is amended by inserting after the item relating

22 to section 213 the following:

‘‘Sec. 213A. Requirements for sponsor’s affidavit of support.’’.

23 (c) EFFECTIVE DATE.—Subsection (a) of section

24 213A of the Immigration and Nationality Act, as inserted

25 by subsection (a) of this section, shall apply to affidavits
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•S 736 IS

1 of support executed on or after a date specified by the

2 Attorney General, which date shall be not earlier than 60

3 days (and not later than 90 days) after the date the Attor4 ney General formulates the form for such affidavits under

5 subsection (b) of such section 213A.

6 SEC. 604. EXTENDING REQUIREMENT FOR AFFIDAVITS OF

7 SUPPORT TO FAMILY-RELATED AND DIVER8 SITY IMMIGRANTS.

9 (A) IN GENERAL.—Section 212(a)(4) of the Immi10 gration and Nationality Act (8 U.S.C. 1182(a)(4)) is

11 amended to read as follows:

12 ‘‘(4) PUBLIC CHARGE AND AFFIDAVITS OF SUP13 PORT.—

14 ‘‘(A) PUBLIC CHARGE.—Any alien who, in

15 the opinion of the consular officer at the time

16 of application for a visa, or in the opinion of

17 the Attorney General at the time of application

18 for admission or adjustment of status, is likely

19 at any time to become a public charge is exclud20 able.

21 ‘‘(B) AFFIDAVITS OF SUPPORT.—Any im22 migrant who seeks admission or adjustment of

23 status as any of the following is excludable un24 less there has been executed with respect to the
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1 immigrant an affidavit of support pursuant to

2 section 213A:

3 ‘‘(i) As an immediate relative (under

4 section 201(b)(2)).

5 ‘‘(ii) As a family-sponsored immigrant

6 under section 203(a) (or as the spouse or

7 child under section 203(d) of such an im8 migrant).

9 ‘‘(iii) As the spouse or child (under

10 section 203(d)) of an employment-based

11 immigrant under section 203(b).

12 ‘‘(iv) As a diversity immigrant under

13 section 203(c) (or as the spouse or child

14 under section 203(d) of such an immi15 grant).’’.

16 (b) EFFECTIVE DATE.—The amendment made by

17 subsection (a) shall apply to aliens with respect to whom

18 an immigrant visa is issued (or adjustment of status is

19 granted) after the date specified by the Attorney General

20 under section 603(c).

21 SEC. 605. LIMITATION ON EXPENDITURES FOR EMERGENCY

22 ASSISTANCE.

23 (a) IN GENERAL.—Section 403(a)(5) (42 U.S.C.

24 602(a)(5)) is amended to read as follows:
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1 ‘‘(5) in the case of any State, an amount equal

2 to the lesser of—

3 ‘‘(A) 50 percent of the total amount ex4 pended under the State plan during such quar5 ter as emergency assistance to needy families

6 with children; or

7 ‘‘(B) the greater of—

8 ‘‘(i) the total amount expended under

9 the State plan during the fiscal year that

10 immediately precedes the fiscal year in

11 which the quarter occurs; multiplied by

12 ‘‘(I) 4 percent, if the national un13 employment rate for the United

14 States (as determined by the Sec15 retary of Labor) for the 3rd or 4th

16 quarter of the immediately preceding

17 fiscal year is at least 7 percent; or

18 ‘‘(II) 3 percent, otherwise; or

19 ‘‘(ii) the total amount expended under

20 the State plan during fiscal year 1995 as

21 emergency assistance to needy families

22 with children.’’.

23 (b) AUTHORITY OF STATES TO DEFINE EMERGENCY

24 ASSISTANCE.—Section 406(e)(1) (42 U.S.C. 606(e)(1)) is

25 amended to read as follows:
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1 ‘‘(e)(1)(A) The term ‘emergency assistance to needy

2 families with children’ means emergency assistance fur3 nished by an eligible State with respect to an eligible needy

4 child to avoid destitution of the child or to provide living

5 arrangements in a home for the child.

6 ‘‘(B) As used in this paragraph:

7 ‘‘(i) The term ‘emergency assistance’ means

8 emergency assistance as provided for in the State

9 plan approved under section 402 of an eligible State,

10 but shall not include care for an eligible needy child

11 or other member of the household in which the child

12 is living to the extent that the child or other member

13 is entitled to such care as medical assistance under

14 the State plan under title XIX.

15 ‘‘(ii) The term ‘eligible needy child’ means a

16 needy child—

17 ‘‘(I) who has not attained 21 years of age;

18 ‘‘(II) who is or (within such period as the

19 Secretary may specify) has been living with any

20 relative specified in subsection (a)(1) in a place

21 of residence maintained by 1 or more of such

22 relatives as the home of the relative or relatives;

23 ‘‘(III) who is without available resources;

24 and
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1 ‘‘(IV) whose requirement for emergency as2 sistance did not arise because the child or rel3 ative refused without good cause to accept em4 ployment or training for employment.

5 ‘‘(iii) The term ‘‘eligible State’’ means a State

6 whose State plan approved under section 402 in7 cludes provision for emergency assistance.’’.

8 TITLE VII—EFFECTIVE DATE

9 SEC. 701. EFFECTIVE DATE.

10 (a) IN GENERAL.—Except as otherwise specifically

11 provided in this Act, the amendments made by this Act

12 shall take effect on the first day of the first fiscal year

13 beginning after the date of the enactment of this Act.

14 (b) EXCEPTION.—In the case of a State that the Sec15 retary of Health and Human Services determines requires

16 State legislation (other than legislation appropriating

17 funds) in order to meet the additional requirements im18 posed by the amendments made by this Act, the State

19 shall not be regarded as failing to comply with the require20 ments of such amendments before the first day of the first

21 calendar quarter beginning after the close of the first reg22 ular session of the State legislature that begins after Octo23 ber 1, 1995, if such State legislature did not meet in a

24 regular session after the date of the enactment of this Act

25 and before October 1, 1995. For purposes of this sub-
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1 section, in the case of a State that has a 2-year legislative

2 session, each year of the session shall be treated as a sepa3 rate regular session of the State legislature.

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