I

104TH CONGRESS

1ST SESSION H. R. 4

To restore the American family, reduce illegitimacy, control welfare spending

and reduce welfare dependence.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 4, 1995

Mr. SHAW, Mr. TALENT, and Mr. LATOURETTE (for themselves, Mr. HUTCHINSON, Mr. HOSTETTLER, Mr. JONES, Mr. TIAHRT, Mrs. MYRICK, Mr.

ENSIGN, Mrs. CUBIN, Mr. KINGSTON, Mr. HASTINGS of Washington, Mr.

GANSKE, Mr. EWING, Mr. WELDON of Florida, Mr. COBURN, Mr. LEWIS

of Kentucky, Mr. BUNNING of Kentucky, Mr. FOLEY, Mr. INGLIS of

South Carolina, Mr. LIGHTFOOT, Mr. ISTOOK, Mr. CALVERT, Mr. HOBSON, Mr. CREMEANS, Mr. KNOLLENBERG, Mr. BILIRAKIS, Mr.

HAYWORTH, Mr. FOX, Mr. RADANOVICH, Mr. ROTH, Mr. WAMP, Mr.

GOODLING, Mr. GILCHREST, Mr. SOLOMON, Mr. BLILEY, Mr. DOOLITTLE, Mr. PACKARD, Mr. STUMP, Mr. EVERETT, Mr. GILMAN, Mr.

MILLER of Florida, Mr. DORNAN, Mr. HASTERT, Mr. CUNNINGHAM, Mr.

FORBES, Mr. LINDER, Mr. BLUTE, Mr. ROHRABACHER, Mr. COOLEY,

Mr. SMITH of Texas, Mr. CLINGER, Mr. BACHUS, Mr. BALLENGER, Mr.

CALLAHAN, Mr. ENGLISH of Pennsylvania, Mr. SAXTON, Mr. CHRYSLER,

Mr. CAMP, Mr. HANCOCK, Mr. NUSSLE, Mr. GREENWOOD, Mr. BARTLETT of Maryland, Mr. TAYLOR of North Carolina, Mr. MCCRERY, Mr.

LARGENT, Mr. BAKER of Louisiana, Mr. COLLINS of Georgia, Mr. ARCHER, Mr. THOMAS, Mr. HERGER, Mr. SAM JOHNSON of Texas, Mr.

STEARNS, Mr. STOCKMAN, Mr. SMITH of Michigan, Mr. BAKER of California, Mrs. ROUKEMA, Mr. SENSENBRENNER, Mr. HEINEMAN, Mrs.

FOWLER, Mr. ROYCE, Mr. FLANAGAN, Mr. BURR, Mr. LATHAM, Ms.

MOLINARI, Mr. GUNDERSON, Mr. RIGGS, Mr. THORNBERRY, Mr. ALLARD, Mr. CHRISTENSEN, Mr. GOODLATTE, Mr. HILLEARY, Mr. WICKER,

Mr. BONO, Mr. FRISA, Mr. SHADEGG, Mr. CANADY, Mr. MCCOLLUM, Mr.

BARTON of Texas, Mr. BARR, Mr. ARMEY, Mr. HORN, Ms. DUNN of

Washington, Mr. TATE, Mr. MICA, Mr. CRAPO, Mr. PAXON, Mr. YOUNG

of Florida, Mr. WELDON of Pennsylvania, Mr. COMBEST, Mr. COBLE,

and Mr. EHRLICH) introduced the following bill; which was referred as

follows:

Title I, referred to the Committee on Ways and Means and, in addition, to

the Committee on Banking and Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of

such provisions as fall within the jurisdiction of the committee concerned
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Title II, referred to the Committee on Ways and Means and, in addition, to

the Committee on Economic and Educational Opportunities, for a period

to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee

concerned

Title III, referred to the Committee on Ways and Means and, in addition, to

the Committees on Banking and Financial Services, Economic and Educational Opportunities, the Budget, and Rules, for a period to be subsequently determined by the Speaker, in each case for consideration of such

provisions as fall within the jurisdiction of the committee concerned

Title IV, referred to the Committee on Ways and Means and, in addition, to

the Committees on Banking and Financial Services, Commerce, Economic

and Educational Opportunities, the Judiciary, and Agriculture, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

Title V, referred to the Committee on Agriculture and, in addition, to the

Committees on Economic and Educational Opportunities and the Judiciary, for a period to be subsequently determined by the Speaker, in each

case for consideration of such provisions as fall within the jurisdiction of

the committee concerned

Title VI–VII, referred to the Committee on Ways and Means

Title VIII, referred to the Committee on Ways and Means and, in addition,

to the Committees on Agriculture, Budget, Economic and Educational

Opportunities, Banking and Financial Services, Commerce, Agriculture,

the Judiciary, and Rules, for a period to be subsequently determined by

the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To restore the American family, reduce illegitimacy, control

welfare spending and reduce welfare dependence.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Personal Responsibility

5 Act of 1995’’.
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1 SEC. 2. TABLE OF CONTENTS.

2 The table of contents for this Act is as follows:

Sec. 1. Short title.

Sec. 2. Table of contents.

TITLE I—REDUCING ILLEGITIMACY

Sec. 100. Sense of the Congress.

Sec. 101. Reduction or denial of AFDC for certain children whose paternity is

not established.

Sec. 102. Teens receiving AFDC required to live at home.

Sec. 103. Earlier paternity establishment efforts by States.

Sec. 104. Increase in paternity establishment percentage.

Sec. 105. Denial of AFDC for certain children born out-of-wedlock.

Sec. 106. Denial of AFDC for additional children.

Sec. 107. State option to deny AFDC benefits to children born out-of-wedlock

to individuals aged 18, 19, or 20, and to deny such benefits

and housing benefits to such individuals.

Sec. 108. Grants to States for assistance to children born out-of-wedlock.

Sec. 109. Removal of barriers to interethnic adoption.

TITLE II—REQUIRING WORK

Sec. 201. Findings; intent; statement of purpose.

Sec. 202. Work program.

Sec. 203. Work supplementation program amendments.

Sec. 204. Payments to States for certain individuals receiving food assistance

from the State who perform work on behalf of the State.

TITLE III—CAPPING THE AGGREGATE GROWTH OF WELFARE

SPENDING

Sec. 301. Cap on growth of Federal spending on certain welfare programs.

Sec. 302. Conversion of funding under certain welfare programs.

Sec. 303. Savings from welfare spending limits to be used for deficit reduction.

TITLE IV—RESTRICTING WELFARE FOR ALIENS

Sec. 401. Ineligibility of aliens for public welfare assistance.

Sec. 402. State AFDC agencies required to provide information on illegal aliens

to the Immigration and Naturalization Service.

TITLE V—CONSOLIDATING FOOD ASSISTANCE PROGRAMS

Sec. 501. Food assistance block grant program.

Sec. 502. Availability of Federal coupon system to States.

Sec. 503. Authority to sell Federal surplus commodities.

Sec. 504. Definitions.

Sec. 505. Repealers; amendments.

Sec. 506. Effective date; application of repealers and amendments.

TITLE VI—EXPANDING STATUTORY FLEXIBILITY OF STATES

Sec. 601. Option to convert AFDC into a block grant program.

Sec. 602. Option to treat new residents of a State under rules of former State.

Sec. 603. Option to impose penalty for failure to attend school.
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Sec. 604. Option to provide married couple transition benefit.

Sec. 605. Option to disregard income and resources designated for education,

training, and employability, or related to self-employment.

Sec. 606. Option to require attendance at parenting and money management

classes, and prior approval of any action that would result in

a change of school for a dependent child.

TITLE VII—DRUG TESTING FOR WELFARE RECIPIENTS

Sec. 701. AFDC recipients required to undergo necessary substance abuse

treatment as a condition of receiving AFDC.

TITLE VIII—EFFECTIVE DATE

Sec. 801. Effective date.

1 TITLE I—REDUCING

2 ILLEGITIMACY

3 SEC. 100. SENSE OF THE CONGRESS.

4 It is the sense of the Congress that—

5 (1) marriage is the foundation of a successful

6 society;

7 (2) marriage is an essential social institution

8 which promotes the interests of children and society

9 at large;

10 (3) the negative consequences of an out-of-wed11 lock birth on the child, the mother, and society are

12 well documented as follows:

13 (A) the illegitimacy rate among black

14 Americans was 26 percent in 1965, but today

15 the rate is 68 percent and climbing;

16 (B) the illegitimacy rate among white

17 Americans has risen tenfold, from 2.29 percent

18 in 1960 to 22 percent today;
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1 (C) the total of all out-of-wedlock births

2 between 1970 and 1991 has risen from 10 per3 cent to 30 percent and if the current trend con4 tinues, 50 percent of all births by the year 2015

5 will be out-of-wedlock;

(D) 3 6 ⁄4 of illegitimate births among whites

7 are to women with a high school education or

8 less;

9 (E) the 1-parent family is 6 times more

10 likely to be poor than the 2-parent family;

11 (F) children born into families receiving

12 welfare assistance are 3 times more likely than

13 children not born into families receiving welfare

14 to be on welfare when they reach adulthood;

15 (G) teenage single parent mothering is the

16 single biggest contributor to low birth weight

17 babies;

18 (H) children born out-of-wedlock are more

19 likely to experience low verbal cognitive attain20 ment, child abuse, and neglect;

21 (I) young people from single parent or

22 stepparent families are 2 to 3 times more likely

23 to have emotional or behavioral problems than

24 those from intact families;
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1 (J) young white women who were raised in

2 a single parent family are more than twice as

3 likely to have children out-of-wedlock and to be4 come parents as teenagers, and almost twice as

5 likely to have their marriages end in divorce, as

6 are children from 2-parent families;

7 (K) the younger the single parent mother,

8 the less likely she is to finish high school;

9 (L) young women who have children before

10 finishing high school are more likely to receive

11 welfare assistance for a longer period of time;

12 (M) between 1985 and 1990, the public

13 cost of births to teenage mothers under the aid

14 to families with dependent children program,

15 the food stamp program, and the medicaid pro16 gram has been estimated at $120,000,000,000;

17 (N) the absence of a father in the life of

18 a child has a negative effect on school perform19 ance and peer adjustment;

20 (O) the likelihood that a young black man

21 will engage in criminal activities doubles if he

22 is raised without a father and triples if he lives

23 in a neighborhood with a high concentration of

24 single parent families; and
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1 (P) the greater the incidence of single par2 ent families in a neighborhood, the higher the

3 incidence of violent crime and burglary; and

4 (4) in light of this demonstration of the crisis

5 in our Nation, the reduction of out-of-wedlock births

6 is an important government interest and the policy

7 contained in provisions of this title address the cri8 sis.

9 SEC. 101. REDUCTION OR DENIAL OF AFDC FOR CERTAIN

10 CHILDREN WHOSE PATERNITY IS NOT ESTAB11 LISHED.

12 (a) IN GENERAL.—Section 402(a) of the Social Secu13 rity Act (42 U.S.C. 602(a)) is amended—

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

15 (44);

16 (2) by striking the period at the end of para17 graph (45) and inserting ‘‘; and’’; and

18 (3) by inserting after paragraph (45) the fol19 lowing:

20 ‘‘(46) provide that—

21 ‘‘(A) except as provided in subparagraph

22 (B), aid under the State plan shall not be pay23 able, to a family on whose behalf an application

24 for such aid is made after the effective date of

25 this paragraph, with respect to a dependent
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1 child whose paternity has not been established,

2 unless—

3 ‘‘(i) the child was conceived as a re4 sult of rape or incest; or

5 ‘‘(ii) the State determines that efforts

6 to establish such paternity would result in

7 physical danger to the child or the relative

8 claiming such aid;

9 ‘‘(B) if the paternity of a dependent child

10 has not been established, the relative claiming

11 such aid alleges that any of not more than 3

12 named individuals may be the biological father

13 of the child and provides the address of each of

14 the named individuals (or, if the relative is not

15 aware of the address of such a named individ16 ual, the address of the immediate relatives of

17 the named individual), and the State has not

18 disproved the allegation, then aid under the

19 State plan may not be denied to the family by

20 reason of subparagraph (A), but the needs of

21 the dependent child shall be disregarded in de22 termining the amount of such aid;

23 ‘‘(C) the relative claiming such aid shall

24 have the burden of proving any allegation of pa25 ternity of a dependent child by an individual
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1 who is deceased, in accordance with procedures

2 established by the State in consultation with

3 the Secretary; and

4 ‘‘(D) if the amount of aid payable to a

5 family under the State plan is reduced by rea6 son of this paragraph, each member of the fam7 ily shall be considered to be receiving such aid

8 for purposes of eligibility for medical assistance

9 under the State plan approved under title XIX

10 for so long as such aid would otherwise not be

11 so reduced.’’.

12 (b) NO EFFECT ON ELIGIBILITY FOR FOSTER CARE

13 MAINTENANCE PAYMENTS.—Section 472(a)(4)(B) of

14 such Act (42 U.S.C. 672(a)(4)(B)) is amended—

15 (1) in clause (i), by inserting ‘‘and section

16 402(a)(46) were not applied to the child’’ before the

17 comma; and

18 (2) in clause (ii), by inserting ‘‘, section

19 402(a)(46) were not applied to the child,’’ before

20 ‘‘and application’’.

21 (c) NO EFFECT ON ELIGIBILITY FOR ADOPTION AS22 SISTANCE PAYMENTS.—Section 473(a)(2)(B)(ii) of such

23 Act (42 U.S.C. 673(a)(2)(B)(ii)) is amended—
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1 (1) in subclause (I), by inserting ‘‘and section

2 402(a)(46) were not applied to the child’’ before the

3 comma; and

4 (2) in subclause (II), by inserting ‘‘, section

5 402(a)(46) were not applied to the child,’’ before

6 ‘‘and application’’.

7 SEC. 102. TEENS RECEIVING AFDC REQUIRED TO LIVE AT

8 HOME.

9 Section 402(a)(43) of the Social Security Act (42

10 U.S.C. 602(a)(43)) is amended—

11 (1) by striking ‘‘at the option of the State,’’;

12 and

13 (2) by striking ‘‘18’’ and inserting ‘‘19’’.

14 SEC. 103. EARLIER PATERNITY ESTABLISHMENT EFFORTS

15 BY STATES.

16 (a) IN GENERAL.—Section 466(a)(5)(C) of the Social

17 Security Act (42 U.S.C. 666(a)(5)(C)) is amended by re18 designating clauses (i) and (ii) as clauses (ii) and (iii) and

19 by inserting before clause (ii) (as so redesignated) the fol20 lowing: ‘‘(i) a requirement that, as soon as an officer or

21 employee of the State becomes aware, in the performance

22 of official duties, of a pregnant, unmarried individual, the

23 officer or employee (I) inform the individual, orally and

24 in writing, that she will be ineligible for aid under the

25 State plan under part A unless she informs the State of
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1 the identity of the prospective father and, after the child

2 is born, cooperates in establishing the paternity of the

3 child, and (II) encourage the individual to urge the pro4 spective father to acknowledge paternity,’’.

5 (b) CONFORMING AMENDMENTS.—Section 466(a)(5)

6 of such Act (42 U.S.C. 666(a)(5)) is amended in each of

7 subparagraphs (D) and (E) by striking ‘‘(C)(ii)’’ and in8 serting ‘‘(C)(iii)’’.

9 (c) SENSE OF THE CONGRESS.—The Congress en10 courages the States to—

11 (1) develop procedures in public hospitals and

12 clinics to facilitate the acknowledgement of pater13 nity; and

14 (2) establish legal procedures that permit the

15 establishment of paternity as quickly and easily as

16 possible.

17 SEC. 104. INCREASE IN PATERNITY ESTABLISHMENT PER18 CENTAGE.

19 Section 452(g)(1) of the Social Security Act (42

20 U.S.C. 652(g)(1)) is amended by striking all that follows

21 ‘‘—’’ and inserting the following:

22 ‘‘(A) 90 percent;

23 ‘‘(B) for a State with a paternity establishment

24 percentage of not less than 50 percent but less than

25 90 percent for such fiscal year, the paternity estab-
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1 lishment percentage of the State for the immediately

2 preceding fiscal year plus 6 percentage points; or

3 ‘‘(C) for a State with a paternity establishment

4 percentage of less than 50 percent for such fiscal

5 year, the paternity establishment percentage of the

6 State for the immediately preceding fiscal year plus

7 10 percentage points.’’.

8 SEC. 105. DENIAL OF AFDC FOR CERTAIN CHILDREN BORN

9 OUT-OF-WEDLOCK.

10 (a) DENIAL OF AFDC.—Section 402(a) of the Social

11 Security Act (42 U.S.C. 602(a)), as amended by section

12 101(a) of this Act, is amended—

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

14 (45);

15 (2) by striking the period at the end of para16 graph (46) and inserting ‘‘; and’’; and

17 (3) by inserting after paragraph (46) the fol18 lowing:

19 ‘‘(47) provide that—

20 ‘‘(A) aid under the plan shall not be pay21 able with respect to a child born out-of-wedlock,

22 on or after the effective date of this paragraph,

23 to an individual who, at the time of such birth,

24 had not attained 18 years of age, unless, after

25 the birth of the child—
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1 ‘‘(i) the individual marries an individ2 ual who the State determines is the bio3 logical father of the child; or

4 ‘‘(ii) the biological parent of the child

5 has legal custody of the child and marries

6 an individual who legally adopts the child;

7 and

8 ‘‘(B) if the amount of aid payable to a

9 family under the State plan is reduced by rea10 son of this paragraph, each member of the fam11 ily shall be considered to be receiving such aid

12 for purposes of eligibility for medical assistance

13 under the State plan approved under title XIX

14 for so long as such aid would otherwise not be

15 so reduced.’’.

16 (b) NO EFFECT ON ELIGIBILITY FOR FOSTER CARE

17 MAINTENANCE PAYMENTS.—Section 472(a)(4)(B) of

18 such Act (42 U.S.C. 672(a)(4)(B)), as amended by section

19 101(b) of this Act, is amended in each of clauses (i) and

20 (ii) by striking ‘‘section 402(a)(46)’’ and inserting ‘‘para21 graphs (46) and (47) of section 402(a)’’.

22 (c) NO EFFECT ON ELIGIBILITY FOR ADOPTION AS23 SISTANCE PAYMENTS.—Section 473(a)(2)(B)(ii) of such

24 Act (42 U.S.C. 673(a)(2)(B)(ii)), as amended by section

25 101(b) of this Act, is amended in each of subclauses (I)
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1 and (II) by striking ‘‘section 402(a)(46)’’ and inserting

2 ‘‘paragraphs (46) and (47) of section 402(a)’’.

3 SEC. 106. DENIAL OF AFDC FOR ADDITIONAL CHILDREN.

4 (a) IN GENERAL.—Section 402(a) of the Social Secu5 rity Act (42 U.S.C. 602(a)), as amended by sections

6 101(a) and 105(a)(1) of this Act, is amended—

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

8 (46);

9 (2) by striking the period at the end of para10 graph (47) and inserting ‘‘; and’’; and

11 (3) by inserting after paragraph (47) the fol12 lowing:

13 ‘‘(48)(A) provide that aid under the plan shall

14 not be payable with respect to a child born on or

15 after the effective date of this paragraph to—

16 ‘‘(i) a recipient of aid under any State plan

17 approved under this part; or

18 ‘‘(ii) an individual who received aid under

19 any such State plan at any time during the 10-

20 month period ending with the birth of the child,

21 unless the recipient or individual was pregnant with

22 the child at the time of application for such aid; and

23 ‘‘(B) if the amount of aid payable to a family

24 under the State plan is reduced by reason of this

25 paragraph, each member of the family shall be con-
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1 sidered to be receiving such aid for purposes of eligi2 bility for medical assistance under the State plan ap3 proved under title XIX for so long as such aid would

4 otherwise not be so reduced.’’.

5 (b) NO EFFECT ON ELIGIBILITY FOR FOSTER CARE

6 MAINTENANCE PAYMENTS.—Section 472(a)(4)(B) of

7 such Act (42 U.S.C. 672(a)(4)(B)), as amended by sec8 tions 101(b) and 105(b) of this Act, is amended in each

9 of clauses (i) and (ii) by striking ‘‘and (47)’’ and inserting

10 ‘‘, (47), and (48)’’.

11 (c) NO EFFECT ON ELIGIBILITY FOR ADOPTION AS12 SISTANCE PAYMENTS.—Section 473(a)(2)(B)(ii) of such

13 Act (42 U.S.C. 673(a)(2)(B)(ii)), as amended by sections

14 101(c) and 105(c) of this Act, is amended in each of

15 subclauses (I) and (II) by striking ‘‘and (47)’’ and insert16 ing ‘‘, (47), and (48)’’.

17 SEC. 107. STATE OPTION TO DENY AFDC BENEFITS TO

18 CHILDREN BORN OUT-OF-WEDLOCK TO INDI19 VIDUALS AGED 18, 19, OR 20, AND TO DENY

20 AFDC BENEFITS AND HOUSING BENEFITS TO

21 SUCH INDIVIDUALS.

22 (a) DENIAL OF AFDC.—

23 (1) IN GENERAL.—Section 402(a) of the Social

24 Security Act (42 U.S.C. 602(a)), as amended by sec-
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1 tions 101(a), 105(a)(1), and 106 of this Act, is

2 amended—

3 (A) by striking ‘‘and’’ at the end of para4 graph (47);

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

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

7 (C) by inserting after paragraph (48) the

8 following:

9 ‘‘(49) at the option of the State, provide that—

10 ‘‘(A) aid under the plan shall not be pay11 able with respect to a child born out-of-wedlock

12 to an individual who, at the time of such birth,

13 had attained 18 years of age but had not at14 tained such age not exceeding 21 years as the

15 State may determine; and

16 ‘‘(B) aid under the plan shall not be pay17 able with respect to an individual who has

18 borne a child out-of-wedlock after attaining 18

19 years of age but before attaining 21 years of

20 age, unless—

21 ‘‘(i) after the birth of the child—

22 ‘‘(I) the individual marries an in23 dividual who the State determines is

24 the biological father of the child; or
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1 ‘‘(II) the biological parent of the

2 child has legal custody of the child

3 and marries an individual who legally

4 adopts the child; or

5 ‘‘(ii) the individual is a biological and

6 custodial parent of another child who was

7 not born out-of-wedlock.’’.

8 (2) NO EFFECT ON ELIGIBILITY FOR FOSTER

9 CARE MAINTENANCE PAYMENTS.—Section

10 472(a)(4)(B) of such Act (42 U.S.C. 672(a)(4)(B)),

11 as amended by sections 101(b), 105(b), and 106(b)

12 of this Act, is amended in each of clauses (i) and (ii)

13 by striking ‘‘and (48)’’ and inserting ‘‘(48), and

14 (49)’’.

15 (3) NO EFFECT ON ELIGIBILITY FOR ADOPTION

16 ASSISTANCE PAYMENTS.—Section 473(a)(2)(B)(ii)

17 of such Act (42 U.S.C. 673(a)(2)(B)(ii)), as amend18 ed by sections 101(c), 105(c), and 106(c) of this

19 Act, is amended in each of subclauses (I) and (II)

20 by striking ‘‘and (48)’’ and inserting ‘‘(48), and

21 (49)’’.

22 (4) LIMITATION ON APPLICABILITY.—The

23 amendments made by this subsection shall not apply

24 to a child born before the effective date of this Act

25 who is a member of a family whose most recent ap-
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1 plication for aid to families with dependent children

2 under a State plan approved under part A of title

3 IV of the Social Security Act was made before such

4 effective date.

5 (b) HOUSING BENEFITS.—

6 (1) PROHIBITION OF ASSISTANCE.—Notwith7 standing any other provision of law, a household

8 whose head of household is an individual who has

9 borne a child out-of-wedlock after attaining 18 years

10 of age but before attaining 21 years of age may not

11 be provided Federal housing assistance for a dwell12 ing unit located in a covered State, unless—

13 (A) after the birth of the child—

14 (i) the individual marries an individ15 ual who has been determined by the rel16 evant State to be the biological father of

17 the child; or

18 (ii) the biological parent of the child

19 has legal custody of the child and marries

20 an individual who legally adopts the child;

21 (B) the individual is a biological and custo22 dial parent of another child who was not born

23 out-of-wedlock; or

24 (C) eligibility for such Federal housing as25 sistance is based in whole or in part on any dis-
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1 ability or handicap of a member of the house2 hold.

3 (2) COVERED STATES.—A State shall be con4 sidered a covered State for purposes of this sub5 section only during the period that—

6 (A) begins upon certification, made by the

7 chief executive officer of the State (at the op8 tion of the State) to the Secretary of Housing

9 and Urban Development and the Secretary of

10 Agriculture, that the State is a covered State

11 for purposes of this subsection; and

12 (B) ends upon submission of written notice

13 (at the option of the State), by the chief execu14 tive officer of the State to such Secretaries,

15 that the State is not a covered State for pur16 poses of this subsection.

17 (3) NOTIFICATION OF HOUSING PROVIDERS.—

18 Upon certification under paragraph (2)(A) for a

19 State and periodically thereafter during the period

20 that the State is a covered State, the Secretary of

21 Housing and Urban Development and the Secretary

22 of Agriculture shall provide written notice that the

23 State is a covered State for purposes of this sub24 section to—
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1 (A) each public housing agency whose area

2 of jurisdiction is located in whole or part within

3 the State; and

4 (B) the owner or manager of each covered

5 project.

6 (4) DEFINITIONS.—For purposes of this sub7 section, the following definitions shall apply:

8 (A) COVERED PROGRAM.—The term ‘‘cov9 ered program’’ means—

10 (i) the program of rental assistance

11 on behalf of low-income families provided

12 under section 8 of the United States Hous13 ing Act of 1937 (42 U.S.C. 1437f);

14 (ii) the public housing program under

15 title I of the United States Housing Act of

16 1937 (42 U.S.C. 1437 et seq.);

17 (iii) the program of rent supplement

18 payments on behalf of qualified tenants

19 pursuant to contracts entered into under

20 section 101 of the Housing and Urban De21 velopment Act of 1965 (12 U.S.C. 1701s);

22 (iv) the program of interest reduction

23 payments pursuant to contracts entered

24 into by the Secretary of Housing and

25 Urban Development under section 236 of
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1 the National Housing Act (12 U.S.C.

2 1715z–1);

3 (v) the program for mortgage insur4 ance provided pursuant to sections

5 221(d)(3) or (4) of the National Housing

6 Act (12 U.S.C. 1715l(d)) for multifamily

7 housing for low- and moderate-income fam8 ilies;

9 (vi) the rural housing loan program

10 under section 502 of the Housing Act of

11 1949 (42 U.S.C. 1472);

12 (vii) the rural housing loan guarantee

13 program under section 502(h) of the Hous14 ing Act of 1949 (42 U.S.C. 1472(h));

15 (viii) the loan and grant programs

16 under section 504 of the Housing Act of

17 1949 (42 U.S.C. 1474) for repairs and im18 provements to rural dwellings;

19 (ix) the program of loans for rental

20 and cooperative rural housing under sec21 tion 515 of the Housing Act of 1949 (42

22 U.S.C. 1485);

23 (x) the program of rental assistance

24 payments pursuant to contracts entered

25 into under section 521(a)(2)(A) of the
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1 Housing Act of 1949 (42 U.S.C.

2 1490a(a)(2)(A));

3 (xi) the loan and assistance programs

4 under sections 514 and 516 of the Hous5 ing Act of 1949 (42 U.S.C. 1484, 1486)

6 for housing for farm labor;

7 (xii) the program of grants and loans

8 for mutual and self-help housing and tech9 nical assistance under section 523 of the

10 Housing Act of 1949 (42 U.S.C. 1490c);

11 (xiii) the program of grants for pres12 ervation and rehabilitation of housing

13 under section 533 of the Housing Act of

14 1949 (42 U.S.C. 1490m); and

15 (xiv) the program of site loans under

16 section 524 of the Housing Act of 1949

17 (42 U.S.C. 1490d).

18 (B) COVERED PROJECT.—The term ‘‘cov19 ered project’’ means any housing for which

20 Federal housing assistance is provided that is

21 attached to the project or specific dwelling units

22 in the project.

23 (C) FEDERAL HOUSING ASSISTANCE.—The

24 term ‘‘Federal housing assistance’’ means—
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1 (i) assistance provided under a cov2 ered program in the form of any contract,

3 grant, loan, subsidy, cooperative agree4 ment, loan or mortgage guarantee or in5 surance, or other financial assistance; or

6 (ii) occupancy in a dwelling unit that

7 is—

8 (I) provided assistance under a

9 covered program; or

10 (II) located in a covered project

11 and subject to occupancy limitations

12 under a covered program that are

13 based on income.

14 (D) PUBLIC HOUSING AGENCY.—The term

15 ‘‘public housing agency’’ has the meaning given

16 the term in section 3(a) of the United States

17 Housing Act of 1937.

18 (E) STATE.—The term ‘‘State’’ means the

19 States of the United States, the District of Co20 lumbia, the Commonwealth of Puerto Rico, the

21 Commonwealth of the Northern Mariana Is22 lands, Guam, the Virgin Islands, American

23 Samoa, and any other territory or possession of

24 the United States.
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1 (5) LIMITATIONS ON APPLICABILITY.—Para2 graph (1) shall not apply to Federal housing assist3 ance provided for a household pursuant to an appli4 cation or request for such assistance made by such

5 household before the effective date of this Act.

6 SEC. 108. GRANTS TO STATES FOR ASSISTANCE TO CHIL7 DREN BORN OUT-OF-WEDLOCK.

8 (a) IN GENERAL.—Title IV of the Social Security Act

9 (42 U.S.C. 601 et seq.) is amended by inserting after part

10 B the following:

11 ‘‘PART C—GRANTS FOR ASSISTANCE TO

12 CHILDREN BORN OUT-OF-WEDLOCK

13 ‘‘SEC. 440. PURPOSE.

14 ‘‘(a) IN GENERAL.—The purpose of this part is to

15 grant a qualified State the flexibility and resources nec16 essary to provide such services and activities as the State

17 deems appropriate to discourage out-of-wedlock births and

18 assure care for children born out-of-wedlock.

19 ‘‘(b) QUALIFIED STATE DEFINED.—For purposes of

20 this part, the term ‘qualified State’ means a State which—

21 ‘‘(1) has a plan approved under section 402;

22 ‘‘(2) has certified to the Secretary that—

23 ‘‘(A) the payments made to the State

24 under this part will be used by the State in ac25 cordance with this part; and
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1 ‘‘(B) not less frequently than every 2

2 years, the State will audit the expenditures of

3 the amounts paid to the State under this part;

4 and

5 ‘‘(3) has provided the Secretary with a copy of

6 any audit the performance of which was the subject

7 of a prior certification pursuant to paragraph (2).

8 ‘‘SEC. 441. USE OF GRANT FUNDS.

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

10 (b), each qualified State that receives grant funds under

11 this part shall use such funds—

12 ‘‘(1) to establish or expand programs to reduce

13 out-of-wedlock pregnancies;

14 ‘‘(2) to promote adoption;

15 ‘‘(3) to establish and operate orphanages;

16 ‘‘(4) to establish and operate closely supervised

17 residential group homes for unwed mothers; or

18 ‘‘(5) in any manner that the State deems ap19 propriate to accomplish the purpose of this part.

20 ‘‘(b) PROHIBITIONS ON USE OF FUNDS.—

21 ‘‘(1) NO INDIVIDUAL PAYMENTS.—A qualified

22 State that receives grant funds under this part shall

23 not use such funds to provide cash payments to an

24 individual who is the parent of a child born out-of25 wedlock or to the child.
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1 ‘‘(2) NO FUNDS USED FOR ABORTION.—No

2 grant funds received by a qualified State under this

3 part shall be used for making abortion available as

4 a method of family planning or for any counseling

5 or advising with respect to abortion.

6 ‘‘(c) PENALTY FOR MISUSE OF FUNDS.—If a quali7 fied State fails to comply with subsection (b) in any fiscal

8 year, the Secretary shall reduce the amount to be paid

9 to such State under this part for the succeeding fiscal year

10 by an amount equal to the amount of funds paid to the

11 State under this part that are involved in the noncompli12 ance.

13 ‘‘SEC. 442. AMOUNT OF GRANT.

14 ‘‘(a) IN GENERAL.—The Secretary shall make a pay15 ment to each qualified State for each fiscal year in an

16 amount equal to the Federal savings amount for the State

17 determined under subsection (b)(1) for the fiscal year.

18 ‘‘(b) DETERMINATION OF GRANT AMOUNT.—

19 ‘‘(1) IN GENERAL.—The Federal savings

20 amount for a State for a fiscal year is an amount

21 that is equal to the product of—

22 ‘‘(A) the State per capita amount for the

23 fiscal year (as determined under paragraph

24 (2)); and
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1 ‘‘(B) the State’s excluded population for

2 the fiscal year (as determined under paragraph

3 (3)).

4 ‘‘(2) PER CAPITA AMOUNT.—The State per cap5 ita amount for a fiscal year is—

6 ‘‘(A) the total amount that the Secretary

7 estimates will be paid to the State under para8 graph (1) or (2) of section 403(a) during the

9 fiscal year; divided by

10 ‘‘(B) the total number of individuals who

11 the Secretary estimates will receive aid under

12 the State plan approved under section 402 dur13 ing the fiscal year.

14 ‘‘(3) STATE EXCLUDED POPULATION.—

15 ‘‘(A) IN GENERAL.—The Director of the

16 Office of Management and Budget shall deter17 mine an excluded population for each qualified

18 State for each fiscal year in accordance with

19 this paragraph.

20 ‘‘(B) DETERMINATION.—A State’s ex21 cluded population for a fiscal year shall equal

22 the sum of—

23 ‘‘(i) the number of excluded children

24 for the State for the fiscal year as deter25 mined under subparagraph (C); and
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1 ‘‘(ii) the number of excluded parents

2 for the State for the fiscal year as deter3 mined under subparagraph (D).

4 ‘‘(C) EXCLUDED CHILDREN.—

5 ‘‘(i) IN GENERAL.—The number of ex6 cluded children for a State for a fiscal year

7 shall be—

8 ‘‘(I) for fiscal year 1996, zero;

9 ‘‘(II) for fiscal year 1997, 50

10 percent of the monthly average num11 ber of base year excluded children (as

12 defined in clause (ii)) who were under

13 age 1 during the base year (as defined

14 in clause (iii));

15 ‘‘(III) for fiscal year 1998, the

16 sum of—

17 ‘‘(aa) the monthly average

18 number of base year excluded

19 children who were under age 1

20 during the base year; and

21 ‘‘(bb) 50 percent of the

22 monthly average number of base

23 year excluded children who were

24 over age 1 and under age 2 dur25 ing the base year;
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1 ‘‘(IV) for fiscal year 1999, the

2 sum of—

3 ‘‘(aa) the monthly average

4 number of base year excluded

5 children who were under age 2

6 during the base year; and

7 ‘‘(bb) 50 percent of the

8 monthly average number of base

9 year excluded children who were

10 over age 2 and under age 3 dur11 ing the base year;

12 ‘‘(V) for fiscal year 2000, the

13 sum of—

14 ‘‘(aa) the monthly average

15 number of base year excluded

16 children who were under age 3

17 during the base year; and

18 ‘‘(bb) 50 percent of the

19 monthly average number of base

20 year excluded children who were

21 over age 3 and under age 4 dur22 ing the base year; and

23 ‘‘(VI) for fiscal years after fiscal

24 year 2000, a number determined by
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1 the Secretary using a formula

2 which—

3 ‘‘(aa) takes into account

4 changes in out-of-wedlock birth

5 rates in previous years, State in6 centives to continue programs de7 signed to reduce illegitimate

8 births, and other factors deemed

9 relevant by the Secretary; and

10 ‘‘(bb) does not result in a

11 payment to any State under this

12 section for any fiscal year that

13 exceeds the payment made to the

14 State under this section for fiscal

15 year 2000.

16 ‘‘(ii) BASE YEAR EXCLUDED CHIL17 DREN.—The term ‘base year excluded chil18 dren’ means children who received aid

19 under the State plan approved under sec20 tion 402 during the base year who would

21 not have been eligible for such aid if para22 graphs (47) and (49) of section 402(a) (as

23 in effect during the applicable fiscal year)

24 had been in effect at the time such chil25 dren were born.
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1 ‘‘(iii) BASE YEAR.—For purposes of

2 this part, the term ‘base year’ means—

3 ‘‘(I) 1994, if the Congressional

4 Budget Office is able to determine an

5 excluded population for each State for

6 each fiscal year that such a deter7 mination is required using data pro8 vided by the National Integrated

9 Quality Control System operated by

10 the Department of Health and

11 Human Services and other relevant

12 data sources; or

13 ‘‘(II) 1994, or another period de14 termined appropriate by the Sec15 retary, based on a survey conducted

16 or approved by the Secretary.

17 ‘‘(D) EXCLUDED PARENTS.—The number

18 of excluded parents for a State for a fiscal year

19 shall be the number of parents excluded in con20 nection with the exclusion of their children

21 under subparagraph (C).’’.

22 (b) STUDY.—Not later than October 1, 1998, and not

23 later than October 1 of each of the 3 immediately

24 succeding years, the Comptroller General of the United

25 States shall submit to the Congress a report on how States
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1 have expended funds provided under part C of title IV of

2 the Social Security Act, the effect of such expenditures

3 on the well-being of mothers and children, and whether

4 there is evidence that illegitimacy rates have changed as

5 as result of the implementation of such part. Any such

6 report may address such related matters as the Comptrol7 ler General deems appropriate to examine.

8 SEC. 109. REMOVAL OF BARRIERS TO INTERETHNIC ADOP9 TION.

10 (a) FINDINGS.—The Congress finds that—

11 (1) nearly 500,000 children are in foster care in

12 the United States;

13 (2) tens of thousands of children in foster care

14 are waiting for adoption;

15 (3) 2 years and 8 months is the median length

16 of time that children wait to be adopted;

17 (4) child welfare agencies should work to elimi18 nate racial, ethnic, and national origin discrimina19 tion and bias in adoption and foster care recruit20 ment, selection, and placement procedures; and

21 (5) active, creative, and diligent efforts are

22 needed to recruit parents, from every race and cul23 ture, for children needing foster care or adoptive

24 parents.
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1 (b) PURPOSE.—The purpose of this section is to de2 crease the length of time that children wait to be adopted

3 and to prevent discrimination in the placement of children

4 on the basis of race, color, or national origin.

5 (c) MULTIETHNIC PLACEMENTS.—

6 (1) ACTIVITIES.—

7 (A) PROHIBITION.—An agency or entity

8 that receives Federal assistance and is involved

9 in adoption or foster care placements may

10 not—

11 (i) deny to any person the opportunity

12 to become an adoptive or a foster parent,

13 on the basis of the race, color, or national

14 origin of the person, or of the child, in15 volved; or

16 (ii) delay or deny the placement of a

17 child for adoption or into foster care, or

18 otherwise discriminate in making a place19 ment decision, on the basis of the race,

20 color, or national origin of the adoptive or

21 foster parent, or the child, involved.

22 (B) DEFINITION.—As used in this para23 graph, the term ‘‘placement decision’’ means

24 the decision to place, or to delay or deny the

25 placement of, a child into foster care or in an
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1 adoptive home, and includes the decision of the

2 agency or entity involved to seek the termi3 nation of birth parent rights or otherwise make

4 a child legally available for adoptive placement.

5 (2) LIMITATION.—The Secretary of Health and

6 Human Services shall not provide placement and ad7 ministrative funds under section 474(a)(3) of the

8 Social Security Act (42 U.S.C. 674(a)(3)) to an

9 agency or entity described in paragraph (1)(A) of

10 this subsection that is not in compliance with para11 graph (1) of this subsection.

12 (3) PRIVATE CAUSE OF ACTION.—

13 (A) IN GENERAL.—Any individual who is

14 aggrieved by a violation of paragraph (1) by an

15 agency or entity described in paragraph (1)(A)

16 may bring an action seeking relief in any Unit17 ed States district court.

18 (B) AUTHORITY TO AWARD A REASONABLE

19 ATTORNEY’S FEE.—In an action brought under

20 this paragraph, the court, in its discretion, may

21 allow a prevailing plaintiff a reasonable attor22 ney’s fee as part of the costs.

23 (C) STATUTE OF LIMITATIONS.—An action

24 under this paragraph may not be brought more
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1 than 2 years after the date the alleged violation

2 occurred.

3 (D) WAIVER OF STATE IMMUNITY.—This

4 paragraph is intended, among other things, to

5 authorize actions against States and State offi6 cials that might otherwise be barred under the

7 Eleventh Article of Amendment to the Constitu8 tion of the United States, and is enacted pursu9 ant to section 5 of the Fourteenth Article of

10 Amendment to the Constitution of the United

11 States.

12 (4) CONSTRUCTION.—This subsection shall not

13 be construed to affect the application of the Indian

14 Child Welfare Act of 1978 (25 U.S.C. 1901 et seq.).

15 TITLE II—REQUIRING WORK

16 SEC. 201. FINDINGS; INTENT; STATEMENT OF PURPOSE.

17 (a) FINDINGS.—The Congress finds that—

18 (1) the cash value of the typical welfare pack19 age of AFDC, food stamps, and medicaid is approxi20 mately $12,000 per year;

21 (2) research shows that adults who leave AFDC

22 for paid employment earn approximately $5.50 per

23 hour, or well over $10,000 per year, and that, when

24 combined with the Earned Income Tax Credit and
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1 food stamps, the total income of former AFDC fami2 lies is at least $15,000 per year;

3 (3) adults who leave AFDC for paid employ4 ment are on the ladder that can lead to greater fu5 ture income, and their children have a role model for

6 the societal value of self-sufficiency; and

7 (4) most adult welfare recipients can find paid

8 employment within 2 years.

9 (b) INTENT OF THE CONGRESS.—The intent of the

10 Congress is to—

11 (1) provide States with the resources and au12 thority necessary to help, cajole, lure, or force adults

13 off welfare and into paid employment as quickly as

14 possible, and to require adult welfare recipients,

15 when necessary, to accept jobs that will help end

16 welfare dependency;

17 (2) permit States to provide education and

18 training to welfare recipients only if, in the judg19 ment of State officials, doing so will enhance the

20 ability of such recipients to leave welfare for paid

21 employment;

22 (3) prohibit the States from providing adult

23 welfare recipients with more than 2 years of edu24 cation or training; and
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1 (4) give States the flexibility to design their

2 own welfare-to-work programs and to decide who

3 must participate in such programs.

4 (c) STATEMENT OF PURPOSE.—The purpose of this

5 title is to move adult welfare recipients from welfare de6 pendency to paid employment as quickly as possible.

7 SEC. 202. WORK PROGRAM.

8 (a) IN GENERAL.—Section 402(a) of the Social Secu9 rity Act (42 U.S.C. 602(a)) is amended by inserting the

10 following after paragraph (28):

11 ‘‘(29) provide that—

12 ‘‘(A)(i) the State shall require recipients of

13 aid under the State plan to participate in a

14 work program in accordance with this para15 graph; and

16 ‘‘(ii) for purposes of this paragraph, the

17 term ‘work program’ means—

18 ‘‘(I) a work supplementation program

19 operated under section 482(e);

20 ‘‘(II) a community work experience

21 program established under section 482(f),

22 or any other work experience program ap23 proved by the Secretary; or
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1 ‘‘(III) any other work program estab2 lished by the State, which is approved by

3 the Secretary;

4 ‘‘(B)(i) except as provided in clause (ii),

5 each individual who is required under this para6 graph to participate in a work program and has

7 received aid under the State plan for at least 24

8 months (whether or not consecutive) after the

9 effective date of this paragraph shall participate

10 in work activities for an average of not fewer

11 than 35 hours per week during any month (or

12 for an average of not fewer than 30 hours per

13 week during any month if the individual is en14 gaged in job search for an average of not fewer

15 than 5 hours per week during the month), but

16 the State may not require any such individual

17 to participate in work activities for more than

18 40 hours during any week; and

19 ‘‘(ii) in the case of a family which receives

20 aid under the State plan by reason of section

21 407—

22 ‘‘(I) the State must require at least 1

23 parent in the family to engage in work ac24 tivities for an average of 32 hours per

25 week during any month and in job search
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1 activities for an average of 8 hours per

2 week during any month; and

3 ‘‘(II) the State must combine the aid

4 payable to the family under the plan, and

5 the cash value of any benefits the State

6 would have provided under title V of the

7 Personal Responsibility Act of 1995 Act to

8 the family, into a single cash payment to

9 the family;

10 ‘‘(C)(i)(I) the State may impose such sanc11 tions as the State considers appropriate on an

12 individual who fails to satisfactorily participate

13 in any activity required under this part during

14 the first 24 months (after the effective date of

15 this paragraph) for which the individual is a re16 cipient of aid under the State plan;

17 ‘‘(II) the State shall reduce the amount

18 otherwise payable under the State plan for the

19 month with respect to an individual to whom

20 subparagraph (B)(i) applies, pro rata with re21 spect to any period during the month for which

22 the individual does not comply with subpara23 graph (B)(i); and

24 ‘‘(III) in the case of a family which re25 ceives aid under the State plan by reason of
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1 section 407, the State shall reduce the cash

2 payment payable to the family pursuant to sub3 paragraph (B)(ii) pro rata with respect to any

4 period for which the family does not comply

5 with subparagraph (B)(ii); and

6 ‘‘(ii) the State may suspend or terminate

7 eligibility for aid under the State plan of any

8 individual to whom a sanction has been applied

9 under clause (i) on 3 or more occasions;

10 ‘‘(D) the State may not provide subsidized

11 non-work activities to an individual under the

12 State plan for more than 24 months (whether

13 or not consecutive) after the effective date of

14 this paragraph;

15 ‘‘(E) at the option of the State, the State

16 may terminate eligibility for aid under the State

17 plan of any family which—

18 ‘‘(i) has received such aid for 24

19 months (whether or not consecutive) after

20 the effective date of this paragraph;

21 ‘‘(ii) has been required under this

22 paragraph for at least 12 months (whether

23 or not consecutive) after such effective

24 date to participate in a work program; and
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1 ‘‘(iii) was offered a work placement at

2 the beginning of such 12-month period;

3 ‘‘(F) an adult who has received aid under

4 the State plan for 60 months (whether or not

5 consecutive) after the effective date of this

6 paragraph shall not be eligible for aid under the

7 State plan; and

8 ‘‘(G) if a family is denied aid under the

9 State plan by reason of subparagraph (E) or

10 (F), each member of the family shall be consid11 ered to be receiving such aid for purposes of eli12 gibility for medical assistance under the State

13 plan approved under title XIX for so long as

14 the family would otherwise be eligible for such

15 aid.’’.

16 (b) PAYMENTS TO STATES; SANCTIONS.—Section

17 403 of such Act (42 U.S.C. 603) is amended by adding

18 at the end the following:

19 ‘‘(o)(1) Each State which has been paid under sub20 section (l) of this section for any fiscal year an amount

21 equal to the limitation determined under subsection (k)(2)

22 of this section for the fiscal year shall be entitled to pay23 ments under paragraph (4) of this subsection for the fiscal

24 year in an amount equal to the lesser of—
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1 ‘‘(A) the sum of the applicable percentages

2 (specified in such paragraph (4)) of its expenditures

3 under section 402(a)(29) with respect to which pay4 ment has not been made under such subsection (l)

5 (subject to limitations prescribed by or pursuant to

6 part F (to the extent applicable) or such paragraph

7 (4) on expenditures that may be included for pur8 poses of determining payment under such paragraph

9 (4)); or

10 ‘‘(B) the limitation determined under paragraph

11 (2) of this subsection with respect to the State for

12 the fiscal year.

13 ‘‘(2) The limitation determined under this paragraph

14 with respect to a State for any fiscal year is the amount

15 that bears the same ratio to the amount specified in para16 graph (3) of this subsection for the fiscal year as the aver17 age monthly number of adult recipients (as defined in sub18 section (k)(4)) in the State in the preceding fiscal year

19 bears to the average monthly number of such recipients

20 in all the States for such preceding year.

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

22 ‘‘(A) $500,000,000 for fiscal year 1996;

23 ‘‘(B) $900,000,000 for fiscal year 1997;

24 ‘‘(C) $1,800,000,000 for fiscal year 1998;

25 ‘‘(D) $2,700,000,000 for fiscal year 1999; and
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1 ‘‘(E) $4,000,000,000 for fiscal year 2000.

2 ‘‘(4) Each State which has been paid under sub3 section (l) of this section for a fiscal year an amount equal

4 to the limitation determined under subsection (k)(2) of

5 this section for the fiscal year shall, in addition to any

6 payment under subsection (a) or (l) of this section, be en7 titled to payment from the Secretary of an amount equal

8 to—

9 ‘‘(A) 50 percent of the expenditures of the

10 State for administrative costs incurred under section

11 402(a)(29) during the fiscal year (other than per12 sonnel costs for staff employed to carry out section

13 402(a)(29)) with respect to which payment has not

14 been made under such subsection (l); and

15 ‘‘(B) the greater of 70 percent or the Federal

16 medical assistance percentage (as defined in section

17 1118 in the case of a State to which section 1108

18 applies, or as defined in section 1905(b) in the case

19 of any other State) of the other expenditures of the

20 State incurred in carrying out section 402(a)(29)

21 during the fiscal year with respect to which payment

22 has not been made under such subsection (l).

23 ‘‘(p)(1) The Secretary shall reduce by 25 percent the

24 amount otherwise payable under subsection (o) to a State

25 for each quarter in a fiscal year if—
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1 ‘‘(A) the State’s participation rate for the 3rd

2 quarter of the immediately preceding fiscal year is

3 less than the participation rate set forth in para4 graph (3) for the immediately preceding fiscal year;

5 or

6 ‘‘(B) for more than 2 months in the imme7 diately preceding fiscal year, the State’s participa8 tion rate for the month is less than the participation

9 rate set forth in paragraph (3) for the 2nd preceding

10 fiscal year.

11 ‘‘(2)(A) A State’s participation rate for a time period

12 shall be—

13 ‘‘(i) the number of individuals receiving aid

14 under the State plan approved under this part who,

15 during the time period, participated in a work pro16 gram (within the meaning of section 402(a)(29)(A))

17 for an average of not fewer than 35 hours per week

18 during the time period (or for an average of not

19 fewer than 30 hours per week during the time period

20 if the individual is engaged in job search for an av21 erage of not fewer than 5 hours per week during the

22 time period); divided by

23 ‘‘(ii) the number of families receiving aid under

24 the State plan approved under this part for the time

25 period.
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1 ‘‘(B) For purposes of subparagraph (A), in the case

2 of an individual who received aid under the State plan ap3 proved under this part for only a portion of a time period,

4 the conduct of the individual during that portion of the

5 time period is deemed to have occurred throughout the

6 time period.

7 ‘‘(3) The participation rate set forth in this para8 graph is—

9 ‘‘(A) 2 percent, for fiscal year 1996;

10 ‘‘(B) 4 percent, for fiscal year 1997;

11 ‘‘(C) 8 percent, for fiscal year 1998;

12 ‘‘(D) 12 percent, for fiscal year 1999;

13 ‘‘(E) 17 percent, for fiscal year 2000;

14 ‘‘(F) 29 percent, for fiscal year 2001;

15 ‘‘(G) 40 percent, for fiscal year 2002; and

16 ‘‘(H) 50 percent, for fiscal year 2003 and each

17 succeeding fiscal year.

18 ‘‘(4)(A) Before the beginning of each fiscal year, the

19 Secretary shall determine the number of individuals each

20 State is required to have participating in a work program

21 pursuant to section 402(a)(29), based on information

22 from the immediately preceding fiscal year and on any in23 formation submitted under subparagraph (B) of this para24 graph.
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1 ‘‘(B) If the number of individuals eligible for aid

2 under the State plan approved under this part during the

3 1st 3 quarters of a fiscal year is less than such number

4 for the 1st 3 quarters of the immediately preceding fiscal

5 year, then, not later than the 1st day of the succeeding

6 fiscal year, the State may submit to the Secretary infor7 mation documenting the decline.

8 ‘‘(C) At the beginning of each fiscal year, the Sec9 retary shall publish in the Federal Register the number

10 determined pursuant to subparagraph (A) for each State

11 for the fiscal year.’’.

12 (c) OTHER PROVISIONS RELATING TO UNEMPLOYED

13 PARENTS.—

14 (1) EXTENSION TO ALL STATES OF OPTION TO

15 LIMIT AFDC–UP PROGRAM.—

16 (A) IN GENERAL.—Section 407(b)(2)(B)

17 of such Act (42 U.S.C. 607(b)(2)(B)) is amend18 ed by striking clause (iii).

19 (B) CONFORMING AMENDMENT.—Section

20 407(b)(2)(B)(i) of such Act (42 U.S.C.

21 607(b)(2)(B)(i)) is amended by striking

22 ‘‘clauses (ii) and (iii)’’ and inserting ‘‘clause

23 (ii)’’.

24 (2) INCREASE IN REQUIRED WORK PROGRAM

25 PARTICIPATION RATES OF UNEMPLOYED PAR-
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1 ENTS.—Section 403(l)(4) of such Act (42 U.S.C.

2 603(l)(4)) is amended—

3 (A) by striking subparagraph (A);

4 (B) in subparagraph (B)—

5 (i) by striking ‘‘subparagraph (A)’’

6 and inserting ‘‘section

7 402(a)(29)(B)(ii)(I)’’;

8 (ii) in clause (iii), by striking ‘‘and’’;

9 (iii) in clause (iv), by striking ‘‘each of

10 the fiscal years 1997 and 1998.’’ and in11 serting ‘‘fiscal year 1997; and’’; and

12 (iv) by adding at the end the follow13 ing:

14 ‘‘(v) 90 percent in the case of the average of

15 each month in fiscal year 1998.’’;

16 (C) in subparagraph (C)—

17 (i) in clause (i), by striking ‘‘subpara18 graph (A)(i)’’ and inserting ‘‘section

19 402(a)(29)(B)(ii)(I)’’; and

20 (ii) in clause (ii), by striking ‘‘sub21 paragraph’’ and inserting ‘‘section’’; and

22 (D) in subparagraph (D)—

23 (i) by striking ‘‘subparagraph (A)’’

24 each place such term appears and inserting

25 ‘‘section 402(a)(29)(B)(ii)(I)’’;
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1 (ii) by inserting ‘‘of this paragraph’’

2 after ‘‘subparagraph (B)’’; and

3 (iii) by adding after and below the end

4 the following:

5 ‘‘The Secretary may not, under this subparagraph, waive

6 a penalty with respect to the same State more than once

7 during any 5-year period.’’.

8 (d) ELIMINATION OF CERTAIN JOBS PROGRAM

9 RULES.—

10 (1) PARTICIPATION REQUIREMENTS.—Section

11 403(l) of such Act (42 U.S.C. 603(l)) is amended by

12 striking paragraphs (2) and (3) and redesignating

13 paragraph (4) as paragraph (2).

14 (2) CWEP HOURS OF WORK LIMITATIONS.—

15 Section 482(f) of such Act (42 U.S.C. 682(f)) is

16 amended—

17 (A) in paragraph (1), by striking subpara18 graph (B) and redesignating subparagraph (C)

19 as subparagraph (B); and

20 (B) by striking paragraph (2) and redesig21 nating paragraphs (3) and (4) as paragraphs

22 (2) and (3), respectively.

23 (3) RULES RELATING TO EXEMPTIONS.—Sec24 tion 402(a)(19) of such Act (42 U.S.C. 602(a)(19))

25 is amended by striking subparagraphs (C) and (D),
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1 by redesignating subparagraphs (E) and (F) as sub2 paragraphs (C) and (D), respectively, and by adding

3 ‘‘and’’ at the end of subparagraph (C) (as so redes4 ignated).

5 (4) SANCTIONS.—Section 402(a)(19) of such

6 Act (42 U.S.C. 602(a)(19)) is amended by striking

7 subparagraph (G).

8 (5) LIMITATION ON AUTHORITY TO COMPEL AC9 CEPTANCE OF A JOB.—Section 402(a)(19) of such

10 Act (42 U.S.C. 602(a)(19)) is amended by striking

11 subparagraph (H).

12 (6) CONFORMING AMENDMENTS AND RE13 PEAL.—

14 (A) Section 402(a)(19)(B) of such Act (42

15 U.S.C. 602(a)(19)(B)) is amended—

16 (i) by striking ‘‘—’’ and all that fol17 lows through ‘‘(i) the’’ and inserting ‘‘the’’;

18 (ii) by striking ‘‘subclause (I)’’ and in19 serting ‘‘clause (i)’’;

20 (iii) by striking clauses (ii), (iii), and

21 (iv);

22 (iv) by redesignating subclauses (I)

23 and (II) as clauses (i) and (ii), respec24 tively; and
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1 (v) by moving clauses (i) and (ii) (as

2 so redesignated) 2 ems to the left.

3 (B) Section 407(b)(1)(B) of such Act (42

4 U.S.C. 607(b)(1)(B)) is amended—

5 (i) by adding ‘‘and’’ at the end of

6 clause (iii);

7 (ii) by striking ‘‘; and’’ at the end of

8 clause (iv) and inserting a period; and

9 (iii) by striking clause (v).

10 (C) Section 482(g)(2) of such Act (42

11 U.S.C. 682(g)) is amended by striking ‘‘(other’’

12 and all that follows through ‘‘applies)’’.

13 (D) Section 486 of such Act (42 U.S.C.

14 686) is hereby repealed.

15 (E) Section 487(a)(1) of such Act (42

16 U.S.C. 687(a)(1)) is amended by inserting ‘‘(as

17 in effect immediately before the effective date of

18 the Personal Responsibility Act of 1995)’’ be19 fore the semicolon.

20 (e) SENSE OF THE CONGRESS.—Each State that op21 erates a program of aid to families with dependent chil22 dren under a plan approved under part A of title IV of

23 the Social Security Act is encouraged to assign the highest

24 priority to requiring families that include older preschool
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1 or school-age children to participate in a work program

2 in accordance with section 402(a)(29) of such Act.

3 SEC. 203. WORK SUPPLEMENTATION PROGRAM AMEND4 MENTS.

5 (a) AUTHORITY OF STATES TO ASSIGN PARTICI6 PANTS TO UNFILLED JOBS.—Section 484(c) of the Social

7 Security Act (42 U.S.C. 684(c)) is amended by striking

8 the last sentence.

9 (b) AUTHORITY OF STATES TO USE SUMS THAT

10 WOULD OTHERWISE BE EXPENDED FOR FOOD STAMP

11 BENEFITS TO PROVIDE SUBSIDIZED JOBS FOR PARTICI12 PANTS.—

13 (1) IN GENERAL.—Section 482(e)(1) of such

14 Act (42 U.S.C. 682(e)(1)) is amended—

15 (A) by inserting ‘‘, and the sums that

16 would otherwise be used to provide participants

17 in the program under this subsection with bene18 fits under title V of the Personal Responsibility

19 Act of 1995,’’ before ‘‘and use’’; and

20 (B) by inserting ‘‘and the benefits under

21 such title that would otherwise be so provided

22 to them’’ before the period.

23 (2) SUBSIDIES PROVIDED TO EMPLOYERS AND

24 INCLUDED IN WAGES OF PARTICIPANTS; MINIMUM

25 EMPLOYER CONTRIBUTION.—Section 482(e)(3) of
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1 such Act (42 U.S.C. 682(e)(3)) is amended by add2 ing at the end the following:

3 ‘‘(E) Each State operating a work supplementation

4 program under this subsection shall enter into an agree5 ment with the employer who is to provide an eligible indi6 vidual with a supplemented job under the program, under

7 which—

8 ‘‘(i) the State is required to pay the employer

9 an amount specified in the agreement as the sub10 sidized portion of the wages of the eligible individ11 ual; and

12 ‘‘(ii) the employer is required to pay the eligible

13 individual wages which, when added to an amount

14 that will be payable as aid to families with depend15 ent children to the individual if the individual is paid

16 such wages, are not less than 100 percent of the

17 sum of—

18 ‘‘(I) the amount that would otherwise be

19 payable as aid to families with dependent chil20 dren to the eligible individual if the State did

21 not have a work supplementation program

22 under this subsection in effect; and

23 ‘‘(II) if the State elects to subsidize jobs

24 for participants in the program through the res25 ervation of sums that would otherwise be used
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1 to provide such participants with benefits under

2 title V of the Personal Responsibility Act of

3 1995, the cash value of such benefits.

4 ‘‘(F) For purposes of computing the amount of the

5 Federal payment to a State under paragraph (1) or (2)

6 of section 403(a), for expenditures incurred in making

7 payments to individuals and employers under the State’s

8 work supplementation program under this section, the

9 State may claim as such expenditures the maximum

10 amount payable to the State under paragraph (4) of this

11 subsection.

12 ‘‘(G) Notwithstanding paragraph (1), a State may

13 use for any purpose the sums reserved under paragraph

14 (1) which are not used to subsidize jobs under this sub15 section attributable to savings achieved by operation of

16 subparagraph (E).’’.

17 (3) CONFORMING AMENDMENT.—Section

18 482(e)(3)(A) of such Act (42 U.S.C. 682(e)(3)(A))

19 is amended by striking the 2nd sentence.

20 SEC. 204. PAYMENTS TO STATES FOR CERTAIN INDIVID21 UALS RECEIVING FOOD ASSISTANCE FROM

22 THE STATE WHO PERFORM WORK ON BE23 HALF OF THE STATE.

24 (a) IN GENERAL.—Each State (as defined in section

25 1101(a)(1) of the Social Security Act for purposes of title
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1 IV of such Act) shall be entitled to receive from the Sec2 retary of Health and Human Services a monthly payment

3 in an amount equal to—

4 (1) $20 (as adjusted under subsection (b) of

5 this section); multiplied by

6 (2) the number of nonexempt individuals (as

7 defined in section 504(7) of this Act) who, during

8 the immediately preceding month—

9 (A) received food assistance from the State

10 under title V of this Act; and

11 (B) performed at least 32 hours of work

12 on behalf of the State or a political subdivision

13 of the State through a work program (as de14 fined in section 402(a)(29)(A)(i) of the Social

15 Security Act).

16 (b) INFLATION ADJUSTMENT.—The Secretary of

17 Health and Human Services shall adjust the amount re18 ferred to in subsection (a)(1) on October 1, 1996, and

19 each October 1 thereafter, to reflect changes in the

20 Consumer Price Index for All Urban Consumers published

21 by the Bureau of Labor Statistics, as appropriately ad22 justed by the Bureau of Labor Statistics after consultation

23 with the Secretary concerning the application of the Index

24 to this paragraph, for the 12 months ending the imme25 diately preceding June 30.
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1 TITLE III—CAPPING THE AGGRE2 GATE GROWTH OF WELFARE

3 SPENDING

4 SEC. 301. CAP ON GROWTH OF FEDERAL SPENDING ON

5 CERTAIN WELFARE PROGRAMS.

6 (a) RESTRICTIONS ON SPENDING.—(1) Effective for

7 fiscal year 1996 and any ensuing fiscal year, the total

8 amount of Federal spending for that fiscal year for the

9 programs listed in subsection (b) shall not exceed an

10 amount equal to the sum of the total estimated Federal

11 spending for the preceding fiscal year on those programs,

12 adjusted for inflation and change of the poverty population

13 as specified in paragraph (2).

14 (2)(A) The inflator used in paragraph (1) shall be

15 the percentage change in the Implicit Gross Domestic

16 Product deflator published by the Department of Com17 merce for the most recently available fiscal year over the

18 preceding fiscal year.

19 (B) Change of the poverty population for purposes

20 of paragraph (1) shall be the percentage by which the

21 number of poor people in the United States in the most

22 recent fiscal year for which data are available from the

23 annual report on poverty published by the Bureau of the

24 Census differs from the number of poor people in the pre25 ceding fiscal year, as computed by the Congressional
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1 Budget Office during January of the calendar year in

2 which the fiscal year subject to the restriction begins.

3 (b) PROGRAMS SUBJECT TO SPENDING LIMIT.—The

4 programs listed in this subsection are the following:

5 (1) FAMILY SUPPORT.—The program of aid

6 and services to needy families with children under

7 part A of title IV of the Social Security Act, child

8 support enforcement program under part D of such

9 title, and the at-risk child care grant under part A

10 of such title.

11 (2) SUPPLEMENTAL SECURITY INCOME.—The

12 supplemental security income program under title

13 XVI of the Social Security Act.

14 (3) HOUSING AID.—

15 (A) Lower income housing assistance

16 under section 8 of the United States Housing

17 Act of 1937 (42 U.S.C. 1772).

18 (B) Low-rent public housing under the

19 United States Housing Act of 1937.

20 (C) Rural housing loans for low-income

21 families under section 502 of the Housing Act

22 of 1949.

23 (D) Interest reduction payments under sec24 tion 236 of the National Housing Act.
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1 (E) Rural rental housing loans under sec2 tion 515 of the Housing Act of 1949.

3 (F) Rural rental assistance under section

4 521 of the Housing Act of 1949.

5 (G) Homeownership assistance for lower

6 income families under section 235 of the Na7 tional Housing Act.

8 (H) Rent supplements under section 101

9 of the Housing and Urban Development Act of

10 1965.

11 (I) Indian housing improvement grants

12 under part 256 of title 25, Code of Federal

13 Regulations.

14 (J) Rural housing repair loan grants for

15 very low-income rural home owners under sec16 tion 504 of the Housing Act of 1949.

17 (K) Farm labor housing loans under sec18 tion 514 of the Housing Act of 1949.

19 (L) Rural housing self-help technical as20 sistance grants under section 523 of the Hous21 ing Act of 1949.

22 (M) Rural housing self-help technical as23 sistance loans under section 523 of the Housing

24 Act of 1949.
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1 (N) Farm labor housing grants under sec2 tion 516 of the Housing Act of 1949.

3 (O) Rural housing preservation grants for

4 low-income rural homeowners under section 533

5 of the Housing Act of 1949.

6 (4) MANDATORY WORK PROGRAM.—The man7 datory work program under part A of title IV of the

8 Social Security Act.

9 (5) JOBS PROGRAM.—The job opportunities

10 and basic skills training program under part F of

11 title IV of the Social Security Act.

12 (c) RECONCILIATION OF GROWTH LIMITS.—

13 (1) ALLOCATIONS.—The joint explanatory

14 statement accompanying a conference report on a

15 concurrent resolution on the budget described in sec16 tion 301 of the Congressional Budget Act of 1974

17 for a fiscal year shall include allocations to each

18 committee based on the spending cap imposed by

19 subsection (a) for such fiscal year.

20 (2) RECONCILIATION DIRECTIVES.—The rec21 onciliation directives described in section 310 of the

22 Congressional Budget Act of 1974 shall specify re23 ductions for each committee necessary to comply

24 with the spending caps imposed by subsection (a) for

25 such fiscal year.
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1 (3) CONSULTATION WITH COMMITTEES.—In

2 conducting any activities required under paragraphs

3 (1) and (2), the Committees on the Budget of the

4 House of Representatives and the Senate shall con5 sult with the following committees of Congress, as

6 applicable:

7 (A) The Committee on Appropriations of

8 the House of Representatives or the Senate.

9 (B) The Committee on Banking and Fi10 nancial Services of the House of Representa11 tives or the Committee on Banking, Housing,

12 and Urban Affairs of the Senate.

13 (C) The Committee on Ways and Means of

14 the House of Representatives.

15 (D) The Committee on Finance of the Sen16 ate.

17 SEC. 302. CONVERSION OF FUNDING UNDER CERTAIN WEL18 FARE PROGRAMS.

19 Notwithstanding any other provision of law, effective

20 October 1, 1995, all entitlement of individuals to benefits

21 established under the following programs, or of States to

22 payments under such programs, is terminated:

23 (1) FAMILY SUPPORT.—The program of aid

24 and services to needy families with children under

25 part A of title IV of the Social Security Act, the
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1 child support enforcement program under part D of

2 such title, and the at-risk child care grant under

3 part A of such title.

4 (2) SUPPLEMENTAL SECURITY INCOME.—The

5 supplemental security income program under title

6 XVI of the Social Security Act.

7 SEC. 303. SAVINGS FROM WELFARE SPENDING LIMITS TO

8 BE USED FOR DEFICIT REDUCTION.

9 All savings to the Federal Government resulting from

10 the spending cap imposed under section 301 shall be used

11 for deficit reduction. Such savings shall not be used to

12 fund increased spending under any programs that are not

13 subject to the spending cap.

14 TITLE IV—RESTRICTING

15 WELFARE FOR ALIENS

16 SEC. 401. INELIGIBILITY OF ALIENS FOR PUBLIC WELFARE

17 ASSISTANCE.

18 (a) IN GENERAL.—Notwithstanding any other provi19 sion of law and except as provided in subsections (b) and

20 (c), no alien shall be eligible for any program referred to

21 in subsection (d).

22 (b) EXCEPTIONS.—

23 (1) REFUGEE EXCEPTION.—Subsection (a)

24 shall not apply to an alien admitted to the United

25 States as a refugee under section 207 of the Immi-
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1 gration and Nationality Act until 6 years after the

2 date of such alien’s arrival into the United States.

3 (2) AGED EXCEPTION.—Subsection (a) shall

4 not apply to an alien who—

5 (A) has been lawfully admitted to the

6 United States for permanent residence;

7 (B) is over 75 years of age; and

8 (C) has resided in the United States for at

9 least 5 years.

10 (3) CURRENT RESIDENT EXCEPTION.—Sub11 section (a) shall not apply to the eligibility of an

12 alien for a program referred to in subsection (d)

13 until 1 year after the date of the enactment of this

14 Act if, on such date of enactment, the alien is resid15 ing in the United States and is eligible for the pro16 gram.

17 (c) PROGRAM FOR WHICH ALIENS MAY BE ELIGI18 BLE.—The limitation under subsection (a) shall not apply

19 to medical assistance with respect to emergency services

20 (as defined for purposes of section 1916(a)(2)(D) of the

21 Social Security Act).

22 (d) PROGRAMS FOR WHICH ALIENS ARE INELI23 GIBLE.—The programs referred to in this subsection are

24 the following:
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1 (1) The program of medical assistance under

2 title XIX of the Social Security Act, except emer3 gency services as provided in subsection (c).

4 (2) The Maternal and Child Health Services

5 Block Grant Program under title V of the Social Se6 curity Act.

7 (3) The program established in section 330 of

8 the Public Health Service Act (relating to commu9 nity health centers).

10 (4) The program established in section 1001 of

11 the Public Health Service Act (relating to family

12 planning methods and services).

13 (5) The program established in section 329 of

14 the Public Health Service Act (relating to migrant

15 health centers).

16 (6) The program of aid and services to needy

17 families with children under part A of title IV of the

18 Social Security Act.

19 (7) The child welfare services program under

20 part B of title IV of the Social Security Act.

21 (8) The supplemental security income program

22 under title XVI of the Social Security Act.

23 (9) The program of foster care and adoption

24 assistance under part E of title IV of the Social Se25 curity Act.
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1 (10) The food assistance block grant program

2 established under title V of this Act.

3 (11) The program of rental assistance on behalf

4 of low-income families provided under section 8 of

5 the United States Housing Act of 1937 (42 U.S.C.

6 1437f).

7 (12) The program of assistance to public hous8 ing under title I of the United States Housing Act

9 of 1937 (42 U.S.C. 1437 et seq.).

10 (13) The loan program under section 502 of the

11 Housing Act of 1949 (42 U.S.C. 1472).

12 (14) The program of interest reduction pay13 ments pursuant to contracts entered into by the Sec14 retary of Housing and Urban Development under

15 section 236 of the National Housing Act (12 U.S.C.

16 1715z–1).

17 (15) The program of loans for rental and coop18 erative housing under section 515 of the Housing

19 Act of 1949 (42 U.S.C. 1485).

20 (16) The program of rental assistance pay21 ments pursuant to contracts entered into under sec22 tion 521(a)(2)(A) of the Housing Act of 1949 (42

23 U.S.C. 1490a(a)(2)(A)).
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1 (17) The program of assistance payments on

2 behalf of homeowners under section 235 of the Na3 tional Housing Act (12 U.S.C. 1715z).

4 (18) The program of rent supplement payments

5 on behalf of qualified tenants pursuant to contracts

6 entered into under section 101 of the Housing and

7 Urban Development Act of 1965 (12 U.S.C. 1701s).

8 (19) The loan and grant programs under sec9 tion 504 of the Housing Act of 1949 (42 U.S.C.

10 1474) for repairs and improvements to rural dwell11 ings.

12 (20) The loan and assistance programs under

13 sections 514 and 516 of the Housing Act of 1949

14 (42 U.S.C. 1484, 1486) for housing for farm labor.

15 (21) The program of grants for preservation

16 and rehabilitation of housing under section 533 of

17 the Housing Act of 1949 (42 U.S.C. 1490m).

18 (22) The program of grants and loans for mu19 tual and self-help housing and technical assistance

20 under section 523 of the Housing Act of 1949 (42

21 U.S.C. 1490c).

22 (23) The program of site loans under section

23 524 of the Housing Act of 1949 (42 U.S.C. 1490d).

24 (24) The program under part B of title IV of

25 the Higher Education Act of 1965.
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1 (25) The program under subpart 1 of part A of

2 title IV of the Higher Education Act of 1965.

3 (26) The program under part C of title IV of

4 the Higher Education Act of 1965.

5 (27) The program under subpart 3 of part A of

6 title IV of the Higher Education Act of 1965.

7 (28) The program under part E of title IV of

8 the Higher Education Act of 1965.

9 (29) The program under subpart 4 of part A of

10 title IV of the Higher Education Act of 1965.

11 (30) The program under title IX of the Higher

12 Education Act of 1965.

13 (31) The program under subpart 5 of part A of

14 title IV of the Higher Education Act of 1965.

15 (32) The programs established in sections 338A

16 and 338B of the Public Health Service Act and the

17 programs established in part A of title VII of such

18 Act (relating to loans and scholarships for education

19 in the health professions).

20 (33) The program established in section

21 317(j)(1) of the Public Health Service Act (relating

22 to grants for immunizations against vaccine-prevent23 able diseases).

24 (34) The program established in section 317A

25 of the Public Health Service Act (relating to grants
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1 for screening, referrals, and education regarding

2 lead poisoning in infants and children).

3 (35) The program established in part A of title

4 XIX of the Public Health Service Act (relating to

5 block grants for preventive health and health serv6 ices).

7 (36) The programs established in subparts I

8 and II of part B of title XIX of the Public Health

9 Service Act.

10 (37)(A) The program of training for disadvan11 taged adults under part A of title II of the Job

12 Training Partnership Act (29 U.S.C. 1601 et seq.).

13 (B) The program of training for disadvantaged

14 youth under part C of title II of the Job Training

15 Partnership Act (29 U.S.C. 1641 et seq.).

16 (38) The Job Corps program under part B of

17 title IV of the Job Training Partnership Act (29

18 U.S.C. 1692 et seq.).

19 (39) The summer youth employment and train20 ing programs under part B of title II of the Job

21 Training Partnership Act (29 U.S.C. 1630 et seq.).

22 (40) The programs carried out under the Older

23 American Community Service Employment Act (42

24 U.S.C. 3001 et seq.).
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1 (41) The programs under title III of the Older

2 Americans Act of 1965.

3 (42) The programs carried out under part B of

4 title II of the Domestic Volunteer Service Act of

5 1973 (42 U.S.C. 5011–5012).

6 (43) The programs carried out under part C of

7 title II of the Domestic Volunteer Service Act of

8 1973 (42 U.S.C. 5013).

9 (44) The program under the Low-Income En10 ergy Assistance Act of 1981 (42 U.S.C. 8621 et

11 seq.).

12 (45) The weatherization assistance program

13 under title IV of the Energy Conservation and Pro14 duction Act (42 U.S.C. 6851).

15 (46) The program of block grants to States for

16 social services under title XX of the Social Security

17 Act.

18 (47) The programs carried out under the Com19 munity Services Block Grant Act (42 U.S.C. 9901

20 et seq.).

21 (48) The program of legal assistance to eligible

22 clients and other programs under the Legal Services

23 Corporation Act (42 U.S.C. 2996 et seq.).

24 (49) The program for emergency food and shel25 ter grants under title III of the Stewart B. McKin-
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1 ney Homeless Assistance Act (42 U.S.C. 11331 et

2 seq.).

3 (50) The programs carried out under the Child

4 Care and Development Block Grant Act of 1990 (42

5 U.S.C. 9858 et seq.).

6 (51) A State program for providing child care

7 under section 402(i) of the Social Security Act.

8 (52) The program of State legalization impact9 assistance grants (SLIAG) under section 204 of the

10 Immigration Reform and Control Act of 1986.

11 (e) NOTIFICATION.—Each Federal agency that ad12 ministers a program referred to in subsection (d) shall,

13 directly or through the States, post information and pro14 vide general notification to the public and program recipi15 ents of the changes regardingly eligibility for any such

16 program pursuant to this section.

17 SEC. 402. STATE AFDC AGENCIES REQUIRED TO PROVIDE

18 INFORMATION ON ILLEGAL ALIENS TO THE

19 IMMIGRATION AND NATURALIZATION SERV20 ICE.

21 Section 402(a) of the Social Security Act (42 U.S.C.

22 602(a)), as amended by title I of this Act, is amended—

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

24 (48);
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1 (2) by striking the period at the end of para2 graph (49) and inserting ‘‘; and’’; and

3 (3) by inserting after paragraph (49) the fol4 lowing:

5 ‘‘(50) require the State agency to provide to the

6 Immigration and Naturalization Service the name,

7 address, and other identifying information that the

8 agency has with respect to any individual unlawfully

9 in the United States any of whose children is a citi10 zen of the United States.’’.

11 TITLE V—CONSOLIDATING FOOD

12 ASSISTANCE PROGRAMS

13 SEC. 501. FOOD ASSISTANCE BLOCK GRANT PROGRAM.

14 (a) AUTHORITY TO MAKE BLOCK GRANTS.—The

15 Secretary of Agriculture shall make grants in accordance

16 with this section to States to provide food assistance to

17 individuals who are economically disadvantaged and to in18 dividuals who are members of economically disadvantaged

19 families.

20 (b) DISTRIBUTION OF FUNDS.—

21 (1) ALLOTMENTS TO STATES.—Subject to para22 graph (2), the funds appropriated to carry out this

23 section for any fiscal year shall be allotted among

24 the States as follows:
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1 (A) Of the aggregate amount to be distrib2 uted under this section, .21 percent shall be re3 served for grants to Guam, the Virgin Islands

4 of the United States, American Samoa, the

5 Commonwealth of the Northern Mariana Is6 lands, the Republic of the Marshall Islands, the

7 Federated States of Micronesia, and Palau.

8 (B) Of the aggregate amount to be distrib9 uted under this section, .24 percent shall be re10 served for grants to tribal organizations that

11 have governmental jurisdiction over geographi12 cally defined areas and shall be allocated equi13 tably by the Secretary among such organiza14 tions.

15 (C) The remainder of such aggregate

16 amount shall be allocated among the remaining

17 States. The amount allocated to each of the re18 maining States shall bear the same proportion

19 to such remainder as the number of resident in20 dividuals in such State who are economically

21 disadvantaged separately or as members of eco22 nomically disadvantaged families bears to the

23 aggregate number of resident individuals in all

24 such remaining States who are economically
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1 disadvantaged separately or as members of eco2 nomically disadvantaged families.

3 (2) LIMITATION.—After September 30, 1996,

4 the aggregate amount allotted under paragraph (1)

5 for any fiscal year shall not exceed the aggregate

6 amount allotted under paragraph (1) for the then

7 preceding fiscal year adjusted by the Secretary to re8 flect—

9 (A) the percentage change in population

10 during the 1-year period ending June 30 of

11 such preceding fiscal year, determined on the

12 basis of the most current information available

13 in the Current Population Reports, P25 series

14 (as adjusted to include overseas members of the

15 armed forces of the United States), published

16 by the Bureau of the Census, and

17 (B) the percentage change in the food at

18 home component of the Consumer Price Index

19 For All Urban Consumers for the 1-year period

20 ending May 31 of such preceding fiscal year.

21 (c) ELIGIBILITY TO RECEIVE GRANTS.—To be eligi22 ble to receive a grant in the amount allotted to a State

23 for a fiscal year, such State shall submit to the Secretary

24 an application in such form, and containing such informa-
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1 tion and assurances, as the Secretary may require by rule,

2 including—

3 (1) an assurance that such grant will be ex4 pended by the State to provide food assistance to

5 resident individuals in such State who are economi6 cally disadvantaged separately or as members of eco7 nomically disadvantaged families,

8 (2) an assurance that not more than 5 percent

9 of such grant will be expended by the State for ad10 ministrative costs incurred to provide assistance

11 under this section,

12 (3) an assurance that not less than 12 percent

13 of each grant received from funds allotted for fiscal

14 years 1996 through 2000 will be expended to pro15 vide food assistance and nutrition education to preg16 nant women, postpartum women, breastfeeding

17 women, infants, and young children,

18 (4) an assurance that not less than 20 percent

19 of each grant received from funds allotted for fiscal

20 years 1996 through 2000 will be expended to pro21 vide—

22 (A) nonprofit school breakfast programs

23 for students from economically disadvantaged

24 families,
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1 (B) milk in nonprofit schools and in non2 profit nursery schools, child care centers, settle3 ment houses, summer camps, and similar insti4 tutions devoted to the care and training of chil5 dren, to children from economically disadvan6 taged families,

7 (C) nonprofit school lunch programs for

8 students from economically disadvantaged fami9 lies,

10 (D) expanded food service programs in in11 stitutions providing child care for children from

12 economically disadvantaged families, and

13 (E) summer food service programs carried

14 out by nonprofit food authorities, local govern15 ments, nonprofit higher education institutions

16 participating in the National Youth Sports Pro17 gram, and residential nonprofit summer camps,

18 to provide meals to children from economically

19 disadvantaged families; and

20 (5) an assurance that the amount of food as21 sistance that will be provided to any nonexempt indi22 vidual who is otherwise eligible to receive such as23 sistance will be reduced proportionally to reflect the

24 extent to which the individual has not performed 32

25 hours of work on behalf of a State or a political sub-
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1 division of a State, through a program established

2 by the State or political subdivision, during the

3 month preceding the month for which such assist4 ance is provided.

5 (d) AUTHORITY TO REDUCE CERTAIN GRANTS RE6 QUIREMENTS.—At the request of a State for a particular

7 fiscal year, the Secretary may reduce a percentage require8 ment specified in paragraph (3) or (4) of subsection (c)

9 if the Secretary determines that the purpose described in

10 such paragraph will be adequately carried out by such

11 State without expending the full amount of funds required

12 by such paragraph.

13 (e) LIMITATION.—No State or political subdivision of

14 a State that receives funds provided under this title shall

15 replace any employed worker with an individual who is

16 participating in a program described in subsection (c)(5)

17 for the purpose of complying with such subsection. Such

18 an individual may be placed in any position offered by the

19 State or political subdivision that—

20 (A) is a new position,

21 (B) is a position that became available in the

22 normal course of conducting the business of the

23 State or political subdivision,

24 (C) involves performing work that would other25 wise be performed on an overtime basis by a worker
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1 who is not an individual participating in such pro2 gram, or

3 (D) that is a position which became available by

4 shifting a current employee to an alternate position.

5 (f) AUTHORIZATION OF APPROPRIATIONS.—(1)

6 There are authorized to be appropriated to carry out this

7 section $35,600,000,000 for fiscal year 1996 and such

8 sums as may be necessary for fiscal years 1997, 1998,

9 1999, and 2000.

10 (2) For the purpose of affording adequate notice of

11 funding available under this section, an appropriation to

12 carry out this section is authorized to be included in an

13 appropriation Act for the fiscal year preceding the fiscal

14 year for which such appropriation is available for obliga15 tion.

16 SEC. 502. AVAILABILITY OF FEDERAL COUPON SYSTEM TO

17 STATES.

18 (a) ISSUANCE, PURCHASE, AND USE OF COUPONS.—

19 The Secretary shall issue, and make available for purchase

20 by States, coupons for the retail purchase of food from

21 retail food stores that are approved in accordance with

22 subsection (b). Coupons issued, purchased, and used as

23 provided in this section shall be redeemable at face value

24 by the Secretary through the facilities of the Treasury of

25 the United States. The purchase price of each coupon is-
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1 sued under this subsection shall be the face value of such

2 coupon.

3 (b) APPROVAL OF RETAIL FOOD STORES AND

4 WHOLESALE FOOD CONCERNS.—(1) Regulations issued

5 pursuant to this section shall provide for the submission

6 of applications for approval by retail food stores and

7 wholesale food concerns which desire to be authorized to

8 accept and redeem coupons under this section. In deter9 mining the qualifications of applicants, there shall be con10 sidered among such other factors as may be appropriate,

11 the following:

12 (A) The nature and extent of the food business

13 conducted by the applicant.

14 (B) The volume of coupon business which may

15 reasonably be expected to be conducted by the appli16 cant food store or wholesale food concern.

17 (C) The business integrity and reputation of

18 the applicant.

19 Approval of an applicant shall be evidenced by the issu20 ance to such applicant of a nontransferable certificate of

21 approval. The Secretary is authorized to issue regulations

22 providing for a periodic reauthorization of retail food

23 stores and wholesale food concerns.

24 (2) A buyer or transferee (other than a bona fide

25 buyer or transferee) of a retail food store or wholesale food
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1 concern that has been disqualified under subsection (d)

2 may not accept or redeem coupons until the Secretary re3 ceives full payment of any penalty imposed on such store

4 or concern.

5 (3) Regulations issued pursuant to this section shall

6 require an applicant retail food store or wholesale food

7 concern to submit information which will permit a deter8 mination to be made as to whether such applicant quali9 fies, or continues to qualify, for approval under this sec10 tion or the regulations issued pursuant to this section.

11 Regulations issued pursuant to this section shall provide

12 for safeguards which limit the use or disclosure of infor13 mation obtained under the authority granted by this sub14 section to purposes directly connected with administration

15 and enforcement of this section or the regulations issued

16 pursuant to this section, except that such information may

17 be disclosed to and used by States that purchase such cou18 pons.

19 (4) Any retail food store or wholesale food concern

20 which has failed upon application to receive approval to

21 participate in the food stamp program may obtain a hear22 ing on such refusal as provided in subsection (f).

23 (c) REDEMPTION OF COUPONS.—Regulations issued

24 under this section shall provide for the redemption of cou25 pons accepted by retail food stores through approved
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1 wholesale food concerns or through financial institutions

2 which are insured by the Federal Deposit Insurance Cor3 poration, or which are insured under the Federal Credit

4 Union Act (12 U.S.C. 1751 et seq.) and have retail food

5 stores or wholesale food concerns in their field of member6 ship, with the cooperation of the Treasury Department,

7 except that retail food stores defined in section

8 504(10)(D) shall be authorized to redeem their members’

9 food coupons prior to receipt by the members of the food

10 so purchased, and publicly operated community mental

11 health centers or private nonprofit organizations or insti12 tutions which serve meals to narcotics addicts or alcoholics

13 in drug addiction or alcoholic treatment and rehabilitation

14 programs, public and private nonprofit shelters that pre15 pare and serve meals for battered women and children,

16 public or private nonprofit group living arrangements that

17 serve meals to disabled or blind residents, and public or

18 private nonprofit establishments, or public or private non19 profit shelters that feed individuals who do not reside in

20 permanent dwellings and individuals who have no fixed

21 mailing addresses shall not be authorized to redeem cou22 pons through financial institutions which are insured by

23 the Federal Deposit Insurance Corporation or the Federal

24 Credit Union Act. No financial institution may impose on

25 or collect from a retail food store a fee or other charge
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1 for the redemption of coupons that are submitted to the

2 financial institution in a manner consistent with the re3 quirements, other than any requirements relating to can4 cellation of coupons, for the presentation of coupons by

5 financial institutions to the Federal Reserve banks.

6 (d) CIVIL MONEY PENALTIES AND DISQUALIFICA7 TION OF RETAIL FOOD STORES AND WHOLESALE FOOD

8 CONCERNS.—(1) Any approved retail food store or whole9 sale food concern may be disqualified for a specified period

10 of time from further participation in the coupon program

11 under this section, or subjected to a civil money penalty

12 of up to $10,000 for each violation if the Secretary deter13 mines that its disqualification would cause hardship to in14 dividuals who receive coupons, on a finding, made as speci15 fied in the regulations, that such store or concern has vio16 lated this section or the regulations issued pursuant to this

17 section.

18 (2) Disqualification under paragraph (1) shall be—

19 (A) for a reasonable period of time, of no less

20 than 6 months nor more than 5 years, upon the first

21 occasion of disqualification,

22 (B) for a reasonable period of time, of no less

23 than 12 months nor more than 10 years, upon the

24 second occasion of disqualification, and

25 (C) permanent upon—
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1 (i) the third occasion of disqualification,

2 (ii) the first occasion or any subsequent oc3 casion of a disqualification based on the pur4 chase of coupons or trafficking in coupons by a

5 retail food store or wholesale food concern, ex6 cept that the Secretary shall have the discretion

7 to impose a civil money penalty of up to

8 $20,000 for each violation (except that the

9 amount of civil money penalties imposed for

10 violations occurring during a single investiga11 tion may not exceed $40,000) in lieu of dis12 qualification under this subparagraph, for such

13 purchase of coupons or trafficking in coupons

14 that constitutes a violation of this section or the

15 regulations issued pursuant to this section, if

16 the Secretary determines that there is substan17 tial evidence (including evidence that neither

18 the ownership nor management of the store or

19 food concern was aware of, approved, benefited

20 from, or was involved in the conduct or ap21 proval of the violation) that such store or food

22 concern had an effective policy and program in

23 effect to prevent violations of this section and

24 such regulations, or
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1 (iii) a finding of the sale of firearms, am2 munition, explosives, or controlled substance (as

3 defined in section 802 of title 21, United States

4 Code) for coupons, except that the Secretary

5 shall have the discretion to impose a civil money

6 penalty of up to $20,000 for each violation (ex7 cept that the amount of civil money penalties

8 imposed for violations occurring during a single

9 investigation may not exceed $40,000) in lieu of

10 disqualification under this subparagraph if the

11 Secretary determines that there is substantial

12 evidence (including evidence that neither the

13 ownership nor management of the store or food

14 concern was aware of, approved, benefited from,

15 or was involved in the conduct or approval of

16 the violation) that the store or food concern had

17 an effective policy and program in effect to pre18 vent violations of this section.

19 (3) The action of disqualification or the imposition

20 of a civil money penalty shall be subject to review as pro21 vided in subsection (f).

22 (4) As a condition of authorization to accept and re23 deem coupons issued under subsection (a), the Secretary

24 may require a retail food store or wholesale food concern

25 which has been disqualified or subjected to a civil penalty
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1 pursuant to paragraph (1) to furnish a bond to cover the

2 value of coupons which such store or concern may in the

3 future accept and redeem in violation of this section. The

4 Secretary shall, by regulation, prescribe the amount,

5 terms, and conditions of such bond. If the Secretary finds

6 that such store or concern has accepted and redeemed cou7 pons in violation of this section after furnishing such bond,

8 such store or concern shall forfeit to the Secretary an

9 amount of such bond which is equal to the value of cou10 pons accepted and redeemed by such store or concern in

11 violation of this section. Such store or concern may obtain

12 a hearing on such forfeiture pursuant to subsection (f).

13 (5)(A) In the event any retail food store or wholesale

14 food concern that has been disqualified under paragraph

15 (1) is sold or the ownership thereof is otherwise trans16 ferred to a purchaser or transferee, the person or persons

17 who sell or otherwise transfer ownership of the retail food

18 store or wholesale food concern shall be subjected to a civil

19 money penalty in an amount established by the Secretary

20 through regulations to reflect that portion of the disquali21 fication period that has not yet expired. If the retail food

22 store or wholesale food concern has been disqualified per23 manently, the civil money penalty shall be double the pen24 alty for a 10-year disqualification period, as calculated

25 under regulations issued by the Secretary. The disquali-
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1 fication period imposed under paragraph (2) shall con2 tinue in effect as to the person or persons who sell or oth3 erwise transfer ownership of the retail food store or whole4 sale food concern notwithstanding the imposition of a civil

5 money penalty under this paragraph.

6 (B) At any time after a civil money penalty imposed

7 under subparagraph (A) has become final under sub8 section (f)(1), the Secretary may request the Attorney

9 General of the United States to institute a civil action

10 against the person or persons subject to the penalty in

11 a district court of the United States for any district in

12 which such person or persons are found, reside, or trans13 act business to collect the penalty and such court shall

14 have jurisdiction to hear and decide such action. In such

15 action, the validity and amount of such penalty shall not

16 be subject to review.

17 (C) The Secretary may impose a fine against any re18 tail food store or wholesale food concern that accepts cou19 pons that are not accompanied by the corresponding book

20 cover, other than the denomination of coupons used for

21 making change as specified in regulations issued under

22 this section. The amount of any such fine shall be estab23 lished by the Secretary and may be assessed and collected

24 separately in accordance with regulations issued under

25 this section or in combination with any fiscal claim estab-
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1 lished by the Secretary. The Attorney General of the Unit2 ed States may institute judicial action in any court of com3 petent jurisdiction against the store or concern to collect

4 the fine.

5 (6) The Secretary may impose a fine against any per6 son not approved by the Secretary to accept and redeem

7 coupons who violates this section or a regulation issued

8 under this section, including violations concerning the ac9 ceptance of coupons. The amount of any such fine shall

10 be established by the Secretary and may be assessed and

11 collected in accordance with regulations issued under this

12 section separately or in combination with any fiscal claim

13 established by the Secretary. The Attorney General of the

14 United States may institute judicial action in any court

15 of competent jurisdiction against the person to collect the

16 fine.

17 (e) COLLECTION AND DISPOSITION OF CLAIMS.—The

18 Secretary shall have the power to determine the amount

19 of and settle and adjust any claim and to compromise or

20 deny all or part of any such claim or claims arising under

21 this section or the regulations issued pursuant to this sec22 tion, including, but not limited to, claims arising from

23 fraudulent and nonfraudulent overissuances to recipients,

24 including the power to waive claims if the Secretary deter25 mines that to do so would serve the purposes of this sec-
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1 tion. Such powers with respect to claims against recipients

2 may be delegated by the Secretary to State agencies.

3 (f) ADMINISTRATIVE AND JUDICIAL REVIEW.—(1)

4 Whenever—

5 (A) an application of a retail food store or

6 wholesale food concern for approval to accept and

7 redeem coupons issued under subsection (a) is de8 nied pursuant to this section,

9 (B) a retail food store or wholesale food con10 cern is disqualified or subjected to a civil money

11 penalty under subsection (d),

12 (C) all or part of any claim of a retail food

13 store or wholesale food concern is denied under sub14 section (e), or

15 (D) a claim against a State is stated pursuant

16 to subsection (e),

17 notice of such administrative action shall be issued to the

18 retail food store, wholesale food concern, or State involved.

19 Such notice shall be delivered by certified mail or personal

20 service. If such store, concern, or State is aggrieved by

21 such action, it may, in accordance with regulations pro22 mulgated under this section, within 10 days of the date

23 of delivery of such notice, file a written request for an

24 opportunity to submit information in support of its posi25 tion to such person or persons as the regulations may des-
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1 ignate. If such a request is not made or if such store, con2 cern, or State fails to submit information in support of

3 its position after filing a request, the administrative deter4 mination shall be final. If such request is made by such

5 store, concern, or State such information as may be sub6 mitted by such store, concern, or State as well as such

7 other information as may be available, shall be reviewed

8 by the person or persons designated by the Secretary, who

9 shall, subject to the right of judicial review hereinafter

10 provided, make a determination which shall be final and

11 which shall take effect 30 days after the date of the deliv12 ery or service of such final notice of determination. If such

13 store, concern, or State feels aggrieved by such final deter14 mination, it may obtain judicial review thereof by filing

15 a complaint against the United States in the United

16 States court for the district in which it resides or is en17 gaged in business, or, in the case of a retail food store

18 or wholesale food concern, in any court of record of the

19 State having competent jurisdiction, within 30 days after

20 the date of delivery or service of the final notice of deter21 mination upon it, requesting the court to set aside such

22 determination. The copy of the summons and complaint

23 required to be delivered to the official or agency whose

24 order is being attacked shall be sent to the Secretary or

25 such person or persons as the Secretary may designate
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1 to receive service of process. The suit in the United States

2 district court or State court shall be a trial de novo by

3 the court in which the court shall determine the validity

4 of the questioned administrative action in issue. If the

5 court determines that such administrative action is in6 valid, it shall enter such judgment or order as it deter7 mines is in accordance with the law and the evidence. Dur8 ing the pendency of such judicial review, or any appeal

9 therefrom, the administrative action under review shall be

10 and remain in full force and effect, unless on application

11 to the court on not less than ten days’ notice, and after

12 hearing thereon and a consideration by the court of the

13 applicant’s likelihood of prevailing on the merits and of

14 irreparable injury, the court temporarily stays such ad15 ministrative action pending disposition of such trial or ap16 peal.

17 (g) VIOLATIONS AND ENFORCEMENT.—(1) Subject

18 to paragraph (2), whoever knowingly uses, transfers, ac19 quires, alters, or possesses coupons in any manner con20 trary to this section or the regulations issued pursuant

21 to this section shall, if such coupons are of a value of

22 $5,000 or more, be guilty of a felony and shall be fined

23 not more than $250,000 or imprisoned for not more than

24 20 years, or both, and shall, if such coupons are of a value

25 of $100 or more, but less than $5,000, be guilty of a fel-
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1 ony and shall, upon the first conviction thereof, be fined

2 not more than $10,000 or imprisoned for not more than

3 5 years, or both, and, upon the second and any subsequent

4 conviction thereof, shall be imprisoned for not less than

5 6 months nor more than 5 years and may also be fined

6 not more than $10,000 or, if such coupons are of a value

7 of less than $100, shall be guilty of a misdemeanor, and,

8 upon the first conviction thereof, shall be fined not more

9 than $1,000 or imprisoned for not more than one year,

10 or both, and upon the second and any subsequent convic11 tion thereof, shall be imprisoned for not more than one

12 year and may also be fined not more than $1,000.

13 (2) In the case of any individual convicted of an of14 fense under paragraph (1), the court may permit such in15 dividual to perform work approved by the court for the

16 purpose of providing restitution for losses incurred by the

17 United States and the State as a result of the offense for

18 which such individual was convicted. If the court permits

19 such individual to perform such work and such individual

20 agrees thereto, the court shall withhold the imposition of

21 the sentence on the condition that such individual perform

22 the assigned work. Upon the successful completion of the

23 assigned work the court may suspend such sentence.

24 (3) Whoever presents, or causes to be presented, cou25 pons for payment or redemption of the value of $100 or
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1 more, knowing the same to have been received, trans2 ferred, or used in any manner in violation of this section

3 or the regulations issued under this section, shall be guilty

4 of a felony and, upon the first conviction thereof, shall

5 be fined not more than $20,000 or imprisoned for not

6 more than 5 years, or both, and, upon the second and any

7 subsequent conviction thereof, shall be imprisoned for not

8 less than one year nor more than 5 years and may also

9 be fined not more than $20,000, or, if such coupons are

10 of a value of less than $100, shall be guilty of a mis11 demeanor and, upon the first conviction thereof, shall be

12 fined not more than $1,000 or imprisoned for not more

13 than one year, or both, and, upon the second and any sub14 sequent conviction thereof, shall be imprisoned for not

15 more than one year and may also be fined not more than

16 $1,000.

17 SEC. 503. AUTHORITY TO SELL FEDERAL SURPLUS COM18 MODITIES.

19 Notwithstanding any other provision of law, the Sec20 retary of Agriculture and the Commodity Credit Corpora21 tion may sell surplus commodities and surplus foodstuffs

22 to the States to provide food assistance to individuals who

23 are economically disadvantaged and to individuals who are

24 members of economically disadvantaged families.
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1 SEC. 504. DEFINITIONS.

2 For purposes of this title—

3 (1) the term ‘‘breastfeeding woman’’ means

4 women up to 1 year postpartum who are

5 breastfeeding their infants,

6 (2) the term ‘‘coupon’’ means any coupon,

7 stamp, or type of certificate, but does not include

8 currency,

9 (3) the term ‘‘economically disadvantaged’’

10 means an individual or a family, as the case may be,

11 whose income does not exceed the most recent lower

12 living standard income level published by the De13 partment of Labor,

14 (4) the term ‘‘elderly or disabled individual’’

15 means an individual who—

16 (A) is 60 years of age or older,

17 (B)(i) receives supplemental security in18 come benefits under title XVI of the Social Se19 curity Act (42 U.S.C. 1381 et seq.), or Feder20 ally or State administered supplemental benefits

21 of the type described in section 212(a) of Public

22 Law 93–66 (42 U.S.C. 1382 note), or

23 (ii) receives Federally or State adminis24 tered supplemental assistance of the type de25 scribed in section 1616(a) of the Social Security

26 Act (42 U.S.C. 1382e(a)), interim assistance
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1 pending receipt of supplemental security in2 come, disability-related medical assistance

3 under title XIX of the Social Security Act (42

4 U.S.C. 1396 et seq.), or disability-based State

5 general assistance benefits, if the Secretary de6 termines that such benefits are conditioned on

7 meeting disability or blindness criteria at least

8 as stringent as those used under title XVI of

9 the Social Security Act,

10 (C) receives disability or blindness pay11 ments under title I, II, X, XIV, or XVI of the

12 Social Security Act (42 U.S.C. 301 et seq.) or

13 receives disability retirement benefits from a

14 governmental agency because of a disability

15 considered permanent under section 221(i) of

16 the Social Security Act (42 U.S.C. 421(i)),

17 (D) is a veteran who—

18 (i) has a service-connected or non19 service-connected disability which is rated

20 as total under title 38, United States Code,

21 or

22 (ii) is considered in need of regular

23 aid and attendance or permanently house24 bound under such title,
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1 (E) is a surviving spouse of a veteran

2 and—

3 (i) is considered in need of regular aid

4 and attendance or permanently house5 bound under title 38, United States Code,

6 or

7 (ii) is entitled to compensation for a

8 service-connected death or pension benefits

9 for a non-service-connected death under

10 title 38, United States Code, and has a

11 disability considered permanent under sec12 tion 221(i) of the Social Security Act (42

13 U.S.C. 421(i)),

14 (F) is a child of a veteran and—

15 (i) is considered permanently incapa16 ble of self-support under section 414 of

17 title 38, United States Code, or

18 (ii) is entitled to compensation for a

19 service-connected death or pension benefits

20 for a non-service-connected death under

21 title 38, United States Code, and has a

22 disability considered permanent under sec23 tion 221(i) of the Social Security Act (42

24 U.S.C. 421(i)), or
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1 (G) is an individual receiving an annuity

2 under section 2(a)(1)(iv) or 2(a)(1)(v) of the

3 Railroad Retirement Act of 1974 (45 U.S.C.

4 231a(a)(1)(iv) or 231a(a)(1)(v)), if the individ5 ual’s service as an employee under the Railroad

6 Retirement Act of 1974, after December 31,

7 1936, had been included in the term ‘‘employ8 ment’’ as defined in the Social Security Act (42

9 U.S.C. 301 et seq.), and if an application for

10 disability benefits had been filed,

11 (5) the term ‘‘food’’ means, for purposes of sec12 tion 502(a) only—

13 (A) any food or food product for home con14 sumption except alcoholic beverages, tobacco,

15 and hot foods or hot food products ready for

16 immediate consumption other than those au17 thorized pursuant to subparagraphs (C), (D),

18 (E), (G), (H), and (I),

19 (B) seeds and plants for use in gardens to

20 produce food for the personal consumption of

21 the eligible individuals,

22 (C) in the case of those persons who are

23 60 years of age or over or who receive supple24 mental security income benefits or disability or

25 blindness payments under title I, II, X, XIV, or
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1 XVI of the Social Security Act (42 U.S.C. 301

2 et seq.), and their spouses, meals prepared by

3 and served in senior citizens’ centers, apart4 ment buildings occupied primarily by such per5 sons, public or private nonprofit establishments

6 (eating or otherwise) that feed such persons,

7 private establishments that contract with the

8 appropriate agency of the State to offer meals

9 for such persons at concessional prices, and

10 meals prepared for and served to residents of

11 federally subsidized housing for the elderly,

12 (D) in the case of persons 60 years of age

13 or over and persons who are physically or men14 tally handicapped or otherwise so disabled that

15 they are unable adequately to prepare all of

16 their meals, meals prepared for and delivered to

17 them (and their spouses) at their home by a

18 public or private nonprofit organization or by a

19 private establishment that contracts with the

20 appropriate State agency to perform such serv21 ices at concessional prices,

22 (E) in the case of narcotics addicts or alco23 holics, and their children, served by drug addic24 tion or alcoholic treatment and rehabilitation
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1 programs, meals prepared and served under

2 such programs,

3 (F) in the case of eligible individuals living

4 in Alaska, equipment for procuring food by

5 hunting and fishing, such as nets, hooks, rods,

6 harpoons, and knives (but not equipment for

7 purposes of transportation, clothing, or shelter,

8 and not firearms, ammunition, and explosives)

9 if the Secretary determines that such individ10 uals are located in an area of the State where

11 it is extremely difficult to reach stores selling

12 food and that such individuals depend to a sub13 stantial extent upon hunting and fishing for

14 subsistence,

15 (G) in the case of disabled or blind recipi16 ents of benefits under title I, II, X, XIV, or

17 XVI of the Social Security Act (42 U.S.C. 301

18 et seq.), or are individuals described in subpara19 graphs (B) through (G) of paragraph (4), who

20 are residents in a public or private nonprofit

21 group living arrangement that serves no more

22 than 16 residents and is certified by the appro23 priate State agency or agencies under regula24 tions issued under section 1616(e) of the Social

25 Security Act (42 U.S.C. 1382e(e)) or under
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1 standards determined by the Secretary to be

2 comparable to standards implemented by appro3 priate State agencies under such section, meals

4 prepared and served under such arrangement,

5 (H) in the case of women and children

6 temporarily residing in public or private non7 profit shelters for battered women and children,

8 meals prepared and served, by such shelters,

9 and

10 (I) in the case of individuals that do not

11 reside in permanent dwellings and individuals

12 that have no fixed mailing addresses, meals pre13 pared for and served by a public or private non14 profit establishment (approved by an appro15 priate State or local agency) that feeds such in16 dividuals and by private establishments that

17 contract with the appropriate agency of the

18 State to offer meals for such individuals at

19 concessional prices,

20 (6) the term ‘‘infants’’ means individuals under

21 1 year of age,

22 (7) the term ‘‘nonexempt individual’’ means an

23 individual who is not—

24 (A) a parent residing with a dependent

25 child under 18 years of age,
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1 (B) a member of a family with responsibil2 ity for the care of an incapacitated family mem3 ber,

4 (C) mentally or physically unfit,

5 (D) under 18 years of age, or

6 (E) 63 years of age or older,

7 (8) the term ‘‘postpartum women’’ means

8 women during the 180-day period after the end of

9 their pregnancy,

10 (9) the term ‘‘pregnant women’’ means women

11 who have one or more fetuses in utero,

12 (10) the term ‘‘retail food store’’ means—

13 (A) an establishment or recognized depart14 ment thereof or house-to-house trade route,

15 over 50 percent of whose food sales volume, as

16 determined by visual inspection, sales records,

17 purchase records, or other inventory or account18 ing recordkeeping methods that are customary

19 or reasonable in the retail food industry, con20 sists of staple food items for home preparation

21 and consumption, such as meat, poultry, fish,

22 bread, cereals, vegetables, fruits, dairy prod23 ucts, and the like, but not including accessory

24 food items, such as coffee, tea, cocoa, carbon-
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1 ated and uncarbonated drinks, candy, con2 diments, and spices,

3 (B) an establishment, organization, pro4 gram, or group living arrangement referred to

5 in subparagraph (C), (D), (E), (G), (H), or (I)

6 of paragraph (5),

7 (C) a store purveying the hunting and fish8 ing equipment described in paragraph (5)(F),

9 or

10 (D) any private nonprofit cooperative food

11 purchasing venture, including those in which

12 the members pay for food purchased prior to

13 the receipt of such food,

14 (11) the term ‘‘school’’ means an elementary,

15 intermediate, or secondary school,

16 (12) the term ‘‘Secretary’’ means the Secretary

17 of Agriculture,

18 (13) the term ‘‘State’’ means any of the several

19 States, the District of Columbia, the Commonwealth

20 of Puerto Rico, Guam, the Virgin Islands of the

21 United States, American Samoa, the Commonwealth

22 of the Northern Mariana Islands, the Republic of

23 the Marshall Islands, the Federated States of Micro24 nesia, Palau, or a tribal organization that exercises
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1 governmental jurisdiction over a geographically de2 fined area,

3 (14) the term ‘‘tribal organization’’ has the

4 meaning given it in section 4(l) of the Indian Self5 Determination and Education Assistance Act (25

6 U.S.C. 450b(l)), and

7 (15) the term ‘‘young children’’ means individ8 uals who are not less than 1 year of age and not

9 more than 5 years of age.

10 SEC. 505. REPEALERS; AMENDMENTS.

11 (a) REPEALERS.—The following Acts are repealed:

12 (1) The Food Stamp Act of 1977 (7 U.S.C.

13 2011 et seq.).

14 (2) The Child Nutrition Act of 1966 (42 U.S.C.

15 1771 et seq.).

16 (3) The National School Lunch Act (42 U.S.C.

17 1751 et seq.)

18 (4) The Emergency Food Assistance Act of

19 1983 (7 U.S.C. 612c note).

20 (5) The Hunger Prevention Act of 1988 (Public

21 Law 100–435; 102 Stat. 1645).

22 (6) The Commodity Distribution Reform Act

23 and WIC Amendments of 1987 (Public Law 100–

24 237; 101 Stat. 1733).
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1 (7) The Child Nutrition and WIC Reauthoriza2 tion Act of 1989 (Public Law 101–147; 103 Stat.

3 877).

4 (b) AMENDMENTS.—

5 (1) The Older Americans Act of 1965 (42

6 U.S.C. 3030a et seq.) is amended by striking sec7 tions 303(b) and 311, and part C of title III.

8 (2) Section 32 of the Act of August 24, 1935

9 (Public Law 320; 7 U.S.C. 612C) is amended—

10 (A) in the first undesignated paragraph—

11 (i) by striking ‘‘30 per centum’’ and

12 inserting ‘‘1.5 per centum’’, and

13 (ii) by striking ‘‘; (2)’’ and all that

14 follows through ‘‘Agriculture;’’, and

15 (B) by striking the last sentence.

16 (3) The Agriculture and Consumer Protection

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

18 striking sections 4 and 5.

19 (4) The Agriculture and Food Act of 1981 (7

20 U.S.C. 1431) is amended by striking section 1114.

21 (5) Section 402 of the Mutual Security Act of

22 1954 (22 U.S.C. 1922) is amended by striking the

23 last sentence.
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1 (6) The Act of September 6, 1958 (Public Law

2 83–931; 7 U.S.C. 1431b) is amended by striking

3 section 9.

4 (7) The Agricultural Act of 1965 (7 U.S.C.

5 1446a–1) is amended by striking section 709.

6 SEC. 506. EFFECTIVE DATE; APPLICATION OF REPEALERS

7 AND AMENDMENTS.

8 (a) EFFECTIVE DATES.—

9 (1) GENERAL EFFECTIVE DATE.—Except as

10 provided in subsection (b), this title and the amend11 ments made by this title shall take effect on the date

12 of the enactment of this Act.

13 (2) SPECIAL EFFECTIVE DATE.—The repeals

14 made by section 505(a) shall not take effect until

15 the first day of the first fiscal year for which funds

16 are appropriated more than 180 days in advance of

17 such fiscal year to carry out section 501.

18 (b) APPLICATION OF REPEALERS AND AMEND19 MENTS.—A repeal or amendment made by section 505

20 shall not apply with respect to—

21 (1) powers, duties, functions, rights, claims,

22 penalties, or obligations applicable to financial as23 sistance provided under the Act repealed or amended

24 before the effective date of such repeal or amend25 ment, and
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1 (2) administrative actions and proceedings com2 menced before such date, or authorized before such

3 date to be commenced, under such Acts.

4 TITLE VI—EXPANDING STATU5 TORY FLEXIBILITY OF

6 STATES

7 SEC. 601. OPTION TO CONVERT AFDC INTO A BLOCK GRANT

8 PROGRAM.

9 Section 403 of the Social Security Act (42 U.S.C.

10 603) is amended by inserting after subsection (b) the fol11 lowing:

12 ‘‘(c)(1) Any State that has in effect a plan approved

13 under part D and is operating a child support program

14 in substantial compliance with that plan may elect to re15 ceive payments under this subsection in lieu of receiving

16 payments under the other subsections of this section.

17 ‘‘(2) If a State makes an election under paragraph

18 (1), then, in lieu of any payment under any other sub19 section of this section, the Secretary shall make payments

20 to the State under this subsection for each fiscal year in

21 an amount equal to 103 percent of the total amount to

22 which the State was entitled under this section for fiscal

23 year 1992, subject to paragraph (5).

24 ‘‘(3) Each State to which an amount is paid under

25 paragraph (2) for a fiscal year shall expend the amount
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1 to carry out any program established by the State to pro2 vide benefits to needy families with dependent children.

3 ‘‘(4) Within 3 months after the end of each fiscal

4 year, each State that has made an election under para5 graph (1) shall submit to the Secretary a report that ac6 counts for all expenditures of amounts paid to the State

7 under this subsection for the fiscal year.

8 ‘‘(5) The Secretary shall reduce by 20 percent the

9 amount that would otherwise be payable to a State under

10 this subsection for a fiscal year if the Secretary finds that

11 the State has expended any amount provided under this

12 subsection for any purpose other than to carry out a pro13 gram of cash benefits to needy families with children.

14 ‘‘(6)(A) The regulations issued with respect to State

15 plans and the operation of State programs under this part

16 (other than under section 402(a)(27), section 403(h), and

17 this subsection) shall not apply to any State that makes

18 an election under paragraph (1).

19 ‘‘(B) Section 403(h) shall continue to apply to any

20 State that makes an election under paragraph (1).’’.

21 SEC. 602. OPTION TO TREAT NEW RESIDENTS OF A STATE

22 UNDER RULES OF FORMER STATE.

23 Section 402(a) of the Social Security Act (42 U.S.C.

24 602(a)), as amended by titles I and IV of this Act, is

25 amended—
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1 (1) by striking ‘‘and’’ at the end of paragraph

2 (49);

3 (2) by striking the period at the end of para4 graph (50) and inserting ‘‘; and’’; and

5 (3) by inserting after paragraph (50) the fol6 lowing:

7 ‘‘(51) at the option of the State, in the case of

8 a family applying for aid under the State plan that

9 has moved to the State from another jurisdiction of

10 the United States that has a plan approved under

11 this part or has made an election under section

12 403(c)(1), and has resided in the State for less than

13 12 months consecutively, apply the rules that would

14 have been applied by such other jurisdiction if the

15 family had not moved from such other jurisdiction,

16 in determining the eligibility of the family for bene17 fits, and the amount of benefits payable to the fam18 ily, under the State plan.’’.

19 SEC. 603. OPTION TO IMPOSE PENALTY FOR FAILURE TO

20 ATTEND SCHOOL.

21 Section 402(a) of the Social Security Act (42 U.S.C.

22 602(a)), as amended by titles I and IV, and section 602,

23 of this Act, is amended—

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

25 (50);
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1 (2) by striking the period at the end of para2 graph (51) and inserting ‘‘; and’’; and

3 (3) by inserting after paragraph (51) the fol4 lowing:

5 ‘‘(52) at the option of the State, provide that

6 the aid otherwise payable under the plan to a family

7 may be reduced by not more than $75 per month for

8 each parent under 21 years of age who has not com9 pleted secondary school (or the equivalent) and each

10 dependent child in the family who, during the imme11 diately preceding month, has failed, without good

12 cause (as defined by the State in consultation with

13 the Secretary), to maintain minimum attendance (as

14 defined by the State in consultation with the Sec15 retary) at an educational institution.’’.

16 SEC. 604. OPTION TO PROVIDE MARRIED COUPLE TRANSI17 TION BENEFIT.

18 (a) IN GENERAL.—Section 402(a) of the Social Secu19 rity Act (42 U.S.C. 602(a)), as amended by titles I and

20 IV, and sections 602 and 603, of this Act, is amended—

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

22 (51);

23 (2) by striking the period at the end of para24 graph (52) and inserting ‘‘; and’’; and
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1 (3) by inserting after paragraph (52) the fol2 lowing:

3 ‘‘(53) at the option of the State, provide that—

4 ‘‘(A) if a recipient of aid under the plan

5 marries an individual who is not a parent of a

6 child of the recipient and (but for this para7 graph) the resulting family would have become

8 ineligible for such aid by reason of the mar9 riage, then the family shall remain eligible for

10 aid under the plan, in an amount equal to 50

11 percent of the aid payable to the recipient im12 mediately before the marriage, for a period

13 (specified by the State) of not more than 12

14 months, but only for so long as the income of

15 the family is less than 150 percent of the in16 come official poverty line (as defined by the Of17 fice of Management and Budget, and revised

18 annually in accordance with section 673(2) of

19 the Omnibus Budget Reconciliation Act of

20 1981) applicable to a family of the size in21 volved; and

22 ‘‘(B) if a recipient of aid under the plan

23 marries an individual who is not a parent of a

24 child of the recipient and the resulting family

25 would (in the absence of this subparagraph) be
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1 eligible for such aid by reason of section 407,

2 then the State may provide aid to the family in

3 accordance with section 407 or subparagraph

4 (A) of this paragraph, but not both.’’.

5 (b) APPLICABILITY.—The amendments made by sub6 section (a) shall apply only with respect to individuals who

7 first become recipients of aid under State plans approved

8 under part A of title IV of the Social Security Act on or

9 after the effective date of this Act.

10 SEC. 605. OPTION TO DISREGARD INCOME AND RESOURCES

11 DESIGNATED FOR EDUCATION, TRAINING,

12 AND EMPLOYABILITY, OR RELATED TO SELF13 EMPLOYMENT.

14 (a) RESOURCE DISREGARDS.—Section 402(a)(7)(B)

15 of the Social Security Act (42 U.S.C. 602(a)(7)(B)) is

16 amended—

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

18 (2) by inserting ‘‘(v) at the option of the State,

19 in the case of a family receiving aid under the State

20 plan (and a family not receiving such aid but which

21 received such aid in at least 1 of the preceding 4

22 months or became ineligible for such aid during the

23 preceding 12 months because of excessive earnings),

24 any amount (determined by the State) not to exceed

25 $10,000 in a qualified asset account (as defined in
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1 section 406(i)) of the family, or (vi) at the option of

2 the State, the first $10,000 of the net worth (assets

3 reduced by liabilities with respect thereto) of all

4 microenterprises (as defined in section 406(j)(1))

5 owned, in whole or in part, by such child, relative,

6 or other individual, for a period not to exceed 2

7 years’’ before ‘‘; and’’.

8 (b) DISREGARD OF INCOME FROM QUALIFIED ASSET

9 ACCOUNTS.—Section 402(a)(8)(A) of such Act (42 U.S.C.

10 602(a)(8)(A)) is amended—

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

12 and

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

14 new clause:

15 ‘‘(ix) at the option of the State, may

16 disregard any interest or income earned on

17 a qualified asset account (as defined in

18 section 406(i)), and any qualified distribu19 tion (as defined in section 406(i)(2)) from

20 a qualified asset account (as defined in

21 section 406(i)(1)); and’’.

22 (c) NONRECURRING LUMP SUM EXEMPT FROM

23 LUMP SUM RULE.—Section 402(a)(17) of such Act (42

24 U.S.C. 602(a)(17)) is amended by adding at the end the

25 following: ‘‘; and, at the option of the State, that this para-
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1 graph shall not apply to earned or unearned income re2 ceived in a month on a nonrecurring basis to the extent

3 that such income is placed in a qualified asset account

4 (as defined in section 406(i)) the total amounts in which,

5 after such placement, does not exceed $10,000;’’.

6 (d) ONLY NET PROFITS OF MICROENTERPRISE

7 TREATED AS INCOME.—Section 402(a)(7) of such Act (42

8 U.S.C. 602(a)(7)), as amended by subsection (a) of this

9 section, is amended—

10 (1) by striking ‘‘and’’ at the end of subpara11 graph (B);

12 (2) by striking the semicolon at the end of sub13 paragraph (C) and inserting ‘‘; and’’; and

14 (3) by adding at the end the following:

15 ‘‘(D) at the option of the State, may take

16 into consideration as earned income of the fam17 ily of which the child is a member, only the net

18 profits (as defined in section 406(j)(2)) of

19 microenterprises (as defined in section

20 406(j)(1)) owned, in whole or in part, by such

21 child, relative, or other individual, for a period

22 not to exceed 2 years.’’.

23 (e) DEFINITIONS.—Section 406 of such Act (42

24 U.S.C. 606) is amended by adding at the end the follow25 ing:
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1 ‘‘(i)(1) The term ‘qualified asset account’ means a

2 mechanism approved by the State (such as individual re3 tirement accounts, escrow accounts, or savings bonds) that

4 allows savings of a family receiving aid to families with

5 dependent children to be used for qualified distributions.

6 ‘‘(2) The term ‘qualified distribution’ means a dis7 tribution from a qualified asset account for expenses di8 rectly related to 1 or more of the following purposes:

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

10 at any education or training program.

11 ‘‘(B) The improvement of the employability (in12 cluding self-employment) of a member of the family

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

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

15 ‘‘(D) A change of the family residence.

16 ‘‘(j)(1) The term ‘microenterprise’ means a commer17 cial enterprise which has 5 or fewer employees, 1 or more

18 of whom owns the enterprise.

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

20 a microenterprise, the gross receipts of the business,

21 minus—

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

23 to the microenterprise;

24 ‘‘(B) transportation expenses;

25 ‘‘(C) inventory costs;
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1 ‘‘(D) expenditures to purchase capital equip2 ment;

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

4 future use by the business;

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

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

7 of insurance against loss—

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

9 and

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

11 that are not reimbursed by the insurer solely by

12 reason of the existence of a deductible with re13 spect to the insurance policy;

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

15 vehicle necessary for the conduct of the business;

16 and

17 ‘‘(I) the other expenses of the business.’’.

18 SEC. 606. OPTION TO REQUIRE ATTENDANCE AT

19 PARENTING AND MONEY MANAGEMENT

20 CLASSES, AND PRIOR APPROVAL OF ANY AC21 TION THAT WOULD RESULT IN A CHANGE OF

22 SCHOOL FOR A DEPENDENT CHILD.

23 (a) IN GENERAL.—Section 402(a) of the Social Secu24 rity Act (42 U.S.C. 602(a)), as amended by titles I and
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1 IV, and sections 602, 603, and 604, of this Act, is amend2 ed—

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

4 (52);

5 (2) by striking the period at the end of para6 graph (53) and inserting ‘‘; and’’; and

7 (3) by inserting after paragraph (53) the fol8 lowing:

9 ‘‘(54) at the option of the State, provide that,

10 as a condition of receiving aid under the State plan,

11 the receipient must attend parenting and money

12 management classes, and must receive the permis13 sion of the State agency before taking any action

14 that would require a change in the educational insti15 tution attended by a dependent child of the recipi16 ent.’’.

17 TITLE VII—DRUG TESTING FOR

18 WELFARE RECIPIENTS

19 SEC. 701. AFDC RECIPIENTS REQUIRED TO UNDERGO NEC20 ESSARY SUBSTANCE ABUSE TREATMENT AS A

21 CONDITION OF RECEIVING AFDC.

22 (a) IN GENERAL.—Section 402(a) of the Social Secu23 rity Act (42 U.S.C. 602(a)) is amended by inserting after

24 paragraph (34) the following:

25 ‘‘(35) provide that—
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1 ‘‘(A) each applicant or recipient of aid

2 under the State plan who is addicted (as deter3 mined by the State) to alcohol or drugs must

4 agree to participate and maintain satisfactory

5 participation (as determined by the State) in an

6 appropriate addiction treatment program (if

7 available), and must agree to submit to tests

8 for the presence of alcohol or drugs, without ad9 vance notice, during and after such participa10 tion; and

11 ‘‘(B) during the 2-year period that begins

12 with any failure by such an applicant or recipi13 ent to comply with any requirement imposed

14 pursuant to subparagraph (A), the applicant or

15 recipient shall not be eligible for such aid, but

16 shall be considered to be receiving such aid for

17 purposes of eligibility for medical assistance

18 under the State plan approved under title

19 XIX.’’.

20 (b) DELAYED APPLICABILITY PERMITTED IF STATE

21 LEGISLATION REQUIRED.—In the case of a State plan ap22 proved under section 402(a) of the Social Security Act

23 which the Secretary of Health and Human Services deter24 mines requires State legislation (other than legislation ap25 propriating funds) in order for the plan to meet the addi-
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1 tional requirement imposed by the amendment made by

2 subsection (a) of this section, the State plan shall not be

3 regarded as failing to comply with the requirements of

4 such section 402(a) solely on the basis of the failure of

5 the plan to meet such additional requirement before the

6 end of the 2-year period that begins with the effective date

7 of this Act.

8 TITLE VIII—EFFECTIVE DATE

9 SEC. 801. EFFECTIVE DATE.

10 This Act and the amendments made by this Act shall

11 take effect on October 1, 1995.

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