I

104TH CONGRESS

1ST SESSION H. R. 741

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

with dependent children program, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 30, 1995

Mr. VOLKMER introduced the following bill; which was referred to the Committee on Ways and Means and, in addition, to the Committees on Economic and Educational Opportunities, Agriculture, Banking and Financial Services, the Judiciary, and Commerce, 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 amend title IV of the Social Security Act by reforming

the aid to families with dependent children program,

and for other purposes.

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

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

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

5 ‘‘Welfare to Self-Sufficiency Act of 1994’’.

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

7 this Act is as follows:

Sec. 1. Short title; table of contents.
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Sec. 2. Findings.

Sec. 3. Amendments to Social Security Act.

TITLE I—FAMILY INVESTMENT PROGRAM AND OTHER WELFARE

REFORM

Sec. 101. Family investment program.

Sec. 102. Work incentives.

Sec. 103. Optional State disregard of dependent child’s income.

Sec. 104. Family stability.

Sec. 105. Work requirements for unemployed parents.

Sec. 106. JOBS program.

Sec. 107. Increased payments to States.

Sec. 108. Assessment, monitoring, and evaluation.

Sec. 109. Timely preventive health care for children.

Sec. 110. Wage supplementation demonstration projects.

Sec. 111. Delay in certain effective dates.

TITLE II—IMPROVEMENTS IN THE COLLECTION OF CHILD

SUPPORT

Sec. 201. Transmission and assignment of certain child support orders to the

IRS.

Sec. 202. Collection of child support by Internal Revenue Service.

Sec. 203. Publication of delinquent child support obligors.

Sec. 204. Effective date.

TITLE III—WELFARE RESTRICTIONS FOR ALIENS

Sec. 301. Eligibility of certain aliens for certain Federal benefits.

Sec. 302. State AFDC agencies required to provide information on illegal aliens

to the Immigration and Naturalization Service.

1 SEC. 2. FINDINGS.

2 The Congress finds the following:

3 (1) The welfare system is failing recipients and

4 taxpayers and must be reformed.

5 (2) The aid to families with dependent children

6 program under title IV of the Social Security Act

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

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

10 changed dramatically during the same period.
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1 (3) The number of female-headed households

2 with children under the age of 18 increased by 146

3 percent from 1970 to 1990, and there are now more

4 children living in single-parent homes than at any

5 time in the Nation’s history.

6 (4) Expenditures for AFDC increased 13 per7 cent (in inflation adjusted dollars) over a 12-year pe8 riod, from $19,600,000,000 in 1980 to

9 $22,200,000,000 in 1992.

10 (5) The number of families on AFDC has in11 creased 33 percent over a 12-year period, from

12 3,600,000 families in 1980 to 4,800,000 families in

13 1992.

14 (6) There were 2,000,000 more children receiv15 ing welfare in 1992 than there were in 1980 and 1

16 in 5 American children currently live in poverty.

17 (7) Many States are enacting sweeping changes

18 to welfare programs in an effort to curb expendi19 tures and reduce the number of dependent families.

20 (8) Welfare reform legislation must recognize

21 the individuality of each family and enact programs

22 that are consistent with this principle.

23 (9) Welfare reform legislation must also recog24 nize the importance of a holistic approach which
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1 treats the family as a single unit and not as the sum

2 of its parts.

3 (10) Health care reform is essential to welfare

4 reform because many families remain on public as5 sistance simply because they cannot afford to lose

6 benefits under the medicaid program under title

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

8 most importantly, for their children.

9 (11) Parents, including noncustodial parents,

10 have a responsibility to provide financial support for

11 their children and failure to provide child support in12 creases the need for AFDC payments.

13 (12) In 1991, the United States Commission on

14 Interstate Child Support reported that the collection

15 of child support fell far short of court awards, with

16 11,000,000 children being awarded $15,000,000,000

17 in child support payments while approximately

18 $5,000,000,000 in child support payments remained

19 unpaid.

20 SEC. 3. AMENDMENTS TO SOCIAL SECURITY ACT.

21 Except as otherwise specifically provided, wherever in

22 this Act an amendment is expressed in terms of an amend23 ment to or repeal of a section or other provision, the ref24 erence shall be considered to be made to that section or

25 other provision of the Social Security Act.
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1 TITLE I—FAMILY INVESTMENT

2 PROGRAM AND OTHER WEL3 FARE REFORM

4 SEC. 101. FAMILY INVESTMENT PROGRAM.

5 (a) STATE PLAN TO INCLUDE FAMILY INVESTMENT

6 PROGRAM.—Section 402(a) (42 U.S.C. 602(a)) is amend7 ed by inserting after paragraph (28) the following new

8 paragraph:

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

10 waiver from the Secretary, provide that the State

11 has in effect a family investment program described

12 in subsection (j);’’.

13 (b) FAMILY INVESTMENT PROGRAM.—Section 402

14 (42 U.S.C. 602) is amended by adding at the end the fol15 lowing new subsection:

16 ‘‘(j) For purposes of subsection (a)(29)—

17 ‘‘(1) The term ‘family investment program’

18 means a program under which the State agency—

19 ‘‘(A) negotiates a family investment agree20 ment (as defined in section 406(i)) with each

21 family, and

22 ‘‘(B) offers a family the opportunity to

23 enter into a limited benefit agreement (as de24 fined in section 406(j)) in lieu of such family

25 investment agreement.
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1 ‘‘(2)(A) Any agreement described in section

2 406(i) shall be entered into by each caretaker rel3 ative, any other relative with whom a dependent rel4 ative is living, and any other individual living in the

5 same home as such relative and the dependent child

6 whose needs are taken into account in making the

7 determination under section 402(a)(7).

8 ‘‘(B) An individual shall not be required to

9 enter into the agreement if such individual is—

10 ‘‘(i) a parent of a child who is less than 6

11 months of age, but if both parents are living in

12 the child’s home, only one parent shall be ex13 empt from entering into the agreement;

14 ‘‘(ii) employed for 30 or more hours per

15 week;

16 ‘‘(iii) ill, incapacitated, or of advanced age;

17 or

18 ‘‘(iv) needed in the home because of the ill19 ness or incapacity of another member of the

20 household.

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

22 ‘‘(A) any correspondence with an individ23 ual described in paragraph (2) relating to the

24 family investment program (including the initial

25 notice of the requirement to enter into a family
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1 investment agreement) shall be in a format

2 which is designed to be easily understandable to

3 such individual;

4 ‘‘(B) the correspondence described in sub5 paragraph (A) shall be designed to be under6 standable to individuals who are not English

7 language speakers; and

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

9 readily available to assist individuals in com10 pleting any documents required for participa11 tion in the family investment program.

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

13 resolution procedure for disputes related to partici14 pation in the family investment agreement that pro15 vides the opportunity for a hearing consistent with

16 the hearing requirement under section 482(h).

17 ‘‘(5)(A) A State shall be treated as meeting the

18 requirements of paragraph (1) for fiscal years 1995

19 through 2002 if it enters into family investment

20 agreements with at least the implementation per21 centage of the applicable population.

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

23 implementation percentage is equal to—

24 ‘‘(i) 10 percent in fiscal year 1995;

25 ‘‘(ii) 15 percent in fiscal year 1996;
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1 ‘‘(iii) 20 percent in fiscal year 1997;

2 ‘‘(iv) 30 percent in fiscal year 1998;

3 ‘‘(v) 40 percent in fiscal year 1999;

4 ‘‘(vi) 60 percent in fiscal year 2000;

5 ‘‘(vii) 70 percent in fiscal year 2001; and

6 ‘‘(viii) 90 percent in fiscal year 2002.

7 ‘‘(C) For purposes of subparagraph (A), the ap8 plicable population is the average total number of in9 dividuals in the State during the fiscal year who—

10 ‘‘(i) receive aid to families with dependent

11 children; and

12 ‘‘(ii) are not exempt from entering a family

13 investment agreement under clauses (i) through

14 (iv) of paragraph (2)(B).’’.

15 (c) FAMILY INVESTMENT AGREEMENT AND LIMITED

16 BENEFIT PLAN.—Section 406 (42 U.S.C. 606) is amend17 ed by adding at the end the following new subsections:

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

19 a social contract between the State and each family receiv20 ing aid to families with dependent children which—

21 ‘‘(1) outlines the steps a family will take to ob22 tain self-sufficiency;

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

24 of eligibility for receipt of aid to families with de25 pendent children that is consistent with unique fam-
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1 ily circumstances and is based on a reasonable plan

2 to facilitate the transition of the family to self-suffi3 ciency;

4 ‘‘(3)(A) contains a requirement that each rel5 ative and any other individual entering into the

6 agreement (except those determined to need child

7 care assistance but for whom the State does not

8 guarantee such assistance in accordance with section

9 402(g)), participate in one or more of the following

10 activities providing such relative or individual with a

11 significant level of commitment up to the level re12 quired for full-time employment:

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

14 ‘‘(ii) Job-search activities.

15 ‘‘(iii) Participation in a job opportunities

16 and basic skills training program which meets

17 the requirements of part F.

18 ‘‘(iv) Participation in education or training

19 programs.

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

21 the provisions of subparagraph (B)), only as

22 part of a plan to improve the employability of

23 the individual and leading to the eventual self24 sufficiency of the family.
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1 ‘‘(vi) Placement in a community work ex2 perience program in accordance with section

3 482(f).

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

5 the equivalent) for a parent under the age of

6 20; and

7 ‘‘(B)(i) provides that an individual who partici8 pates in unpaid community service under subpara9 graph (A)(v) shall not be required to perform such

10 unpaid community service for a greater number of

11 hours per month than the maximum number of

12 hours an individual may be required to work in any

13 month under the community work experience pro14 gram as determined under section 482(f)(1)(B)(i);

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

16 service to comply with the rules described in sub17 sections (b), (c), (d), and (g) of section 484 of the

18 Social Security Act (42 U.S.C. 684); and

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

20 in unpaid community service may not exceed 3

21 months;

22 ‘‘(4) provides each relative and any other indi23 vidual entering into the agreement with the supple24 mental services required to obtain self-sufficiency

25 and comply with the terms of the family investment
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1 agreement, including health care, transportation,

2 child care, education, and training;

3 ‘‘(5) if the State agency and a relative or other

4 individual entering into the agreement agree, pro5 vides that the relative or other individual participate

6 in—

7 ‘‘(A) a substance abuse treatment pro8 gram, or other social service program that the

9 State agency determines necessary to increase

10 the employability of such relative or individual;

11 ‘‘(B) programs and support services to

12 strengthen parenting skills and assure family

13 stability; and

14 ‘‘(C) programs that lead to improved

15 school readiness for preschool children and on16 grade performance for school age children;

17 ‘‘(6) provides that the State agency shall pro18 vide the family with reasonable support and case

19 management in the creation, monitoring, and adap20 tation of a family investment agreement to respond

21 to changes in family circumstances and factors out22 side family control;

23 ‘‘(7) provides that the State agency shall re24 negotiate the family investment agreement—
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1 ‘‘(A) during the period of the agreement,

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

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

5 agreement, if each relative and any other indi6 vidual entering into the agreement has made a

7 good faith effort to comply with the agreement

8 but were unable to reach self-sufficiency be9 cause of factors outside of the control of the

10 relative or other individual;

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

12 enter into a limited benefit plan (as described in

13 subsection (j)) if a relative or other individual who

14 has entered into the family investment agreement

15 fails to comply with the agreement; and

16 ‘‘(9) provides that the agreement shall be in17 valid if the State agency fails to comply with the

18 agreement.

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

20 which, notwithstanding any other provision of this title,

21 provides that—

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

23 which a family receives aid under the plan, the fam24 ily shall receive benefits as normally determined

25 under this title;
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1 ‘‘(B) during the second 3-month period in

2 which the family receives aid under the plan, the

3 needs of the caretaker relative, any other relative

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

5 individual living in the same home as such relative

6 and the dependent child whose needs are taken into

7 account in making the determination under section

8 402(a)(7), shall not be taken into account in making

9 the determination with respect to the family for pur10 poses of paragraph (7) and in the case of a family

11 which is eligible by reason of section 407, both par12 ents shall not be taken into account into making

13 such a determination; and

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

15 beginning on the date on which the family entered

16 into the limited benefit plan, the family shall be in17 eligible for benefits under this title and may not re18 apply for such benefits within a 6-month period be19 ginning on the date of such expiration;

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

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

22 well-being of the dependent children; and

23 ‘‘(3) within a 45-day period beginning on the

24 date that the family automatically enters a limited

25 benefit plan by reason of the family investment
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1 agreement provision described in subsection (i)(8) or

2 elects to enter a limited benefit plan under section

3 402(j)(1), the family shall have the option to void

4 the limited benefit plan by regaining compliance with

5 the negotiated family investment agreement or if no

6 agreement has been negotiated, negotiate an agree7 ment.’’.

8 (d) COORDINATION BETWEEN DEPARTMENTS.—

9 (1) IN GENERAL.—The Secretary of Health and

10 Human Services, the Secretary of Labor, and the

11 Secretary of Education shall ensure appropriate co12 ordination in the planning, development, and oper13 ation of the programs described in paragraph (2) in

14 order to—

15 (A) improve the quality and effectiveness

16 of services provided by the Department of

17 Health and Human Services, the Department of

18 Labor, and the Department of Education;

19 (B) reduce the overlap of such programs;

20 and

21 (C) reduce the administrative costs of such

22 programs.

23 (2) PROGRAMS DESCRIBED.—The programs de24 scribed in this paragraph are as follows:
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1 (A) The family investment program under

2 section 402(j) of the Social Security Act (42

3 U.S.C. 602(j)).

4 (B) The JOBS program under part F of

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

6 681 et seq.).

7 (C) Job training programs.

8 (D) Child care programs.

9 (E) Educational programs.

10 (F) Any other program administered by

11 the Department of Health and Human Services,

12 the Department of Labor, or the Department of

13 Education which has the effect of promoting

14 self-sufficiency among recipients of aid to fami15 lies with dependent children under title IV of

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

17 (e) EFFECTIVE DATE.—Except as provided in section

18 111, the amendments made by this section shall take ef19 fect on the first day of the first fiscal year beginning after

20 the date of the enactment of this Act.

21 SEC. 102. WORK INCENTIVES.

22 (a) INCREASE IN WORK EXPENSE DISREGARD.—Sec23 tion 402(a)(8)(A)(ii) (42 U.S.C. 602(a)(8)(A)(ii)) is

24 amended by inserting ‘‘, or at the option of the State (on

25 a statewide basis or in a defined area of the State), the
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1 greater of the first $90, or up to the first 20 percent of

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

3 ‘‘such month’’.

4 (b) INCREASE IN EARNED INCOME INCENTIVE.—

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

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

7 (A) by striking ‘‘(II)’’; and

8 (B) by inserting ‘‘, or (II) at the option of

9 the State (on a statewide basis or in a defined

10 area of the State), up to one-half of the total

11 of such earned income not disregarded under

12 any other clause of this subparagraph if such

13 amount is greater than the amount disregarded

14 under subclause (I)’’ before the semicolon at

15 the end.

16 (2) NO TIME LIMITATION.—Section

17 402(a)(8)(B) (42 U.S.C. 602(a)(8)(B)) is amended

18 to read as follows:

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

20 the State agency shall not disregard under clause

21 (ii), (iii), or (iv) of subparagraph (A) any earned in22 come of any one of the individuals specified in sub23 paragraph (A)(ii) if such individual—

24 ‘‘(i) terminated the individual’s employ25 ment or reduced the individual’s earned income
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1 without good cause within such period (of not

2 less than 30 days) preceding such month as

3 may be prescribed by the Secretary;

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

5 such period preceding such month as may be

6 prescribed by the Secretary, to accept employ7 ment in which the individual is able to engage

8 which is offered through the public employment

9 offices of the State, or is otherwise offered by

10 an employer if the offer of such employer is de11 termined by the State or local agency admin12 istering the State plan, after notification by the

13 employer, to be a bona fide offer of employ14 ment; or

15 ‘‘(iii) failed without good cause to make a

16 timely report (as prescribed by the State plan

17 pursuant to paragraph (14)) to the State agen18 cy of earned income received in such month;

19 and’’.

20 (c) WORK TRANSITION PERIOD.—

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

22 U.S.C. 602(a)(8)(A)) is amended—

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

24 (vii); and
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1 (B) by inserting after clause (viii) the fol2 lowing new clause:

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

5 may disregard up to the first 4 months of

6 earned income due to new employment of any

7 child or relative receiving aid to families with

8 dependent children, or of any other individual

9 (living in the same home as such relative and

10 child) whose needs are taken into account in

11 making such a determination not disregarded

12 under any other clause of this subparagraph,

13 if—

14 ‘‘(I) such individual earned less than

15 $1,200 in the 12-month period preceding

16 the new employment; and

17 ‘‘(II) such individual timely reports

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

19 (2) AFDC QUALITY CONTROL.—Section

20 408(c)(3) (42 U.S.C. 608(c)(3)) is amended—

21 (A) by striking ‘‘or’’ at the end of subpara22 graph (D);

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

24 subparagraph (E) and inserting ‘‘; or’’; and
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1 (C) by adding at the end the following new

2 subparagraph:

3 ‘‘(F) the State’s reliance on the best infor4 mation available in determining eligibility for

5 the earned income disregard described in sec6 tion 402(a)(8)(A)(ix).’’.

7 (d) RETROSPECTIVE BUDGETING PROCEDURES.—

8 Section 402(a)(13) (42 U.S.C. 602(a)(13)) is amended—

9 (1) by striking ‘‘subparagraph (B)’’ in subpara10 graph (A) and inserting ‘‘subparagraphs (B) and

11 (C)’’;

12 (2) by striking ‘‘and’’ at the end of subpara13 graph (A);

14 (3) by adding ‘‘and’’ at the end of subpara15 graph (B); and

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

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

19 source of income of an individual whose income

20 is taken into account in making a determination

21 under paragraph (7), the State agency shall

22 consider the loss of income in making a deter23 mination regarding the amount of aid, begin24 ning in the first month such loss of income oc25 curs, but only if the termination is timely re-
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1 ported and, in the case of earned income, the

2 individual shows good cause for the termination

3 of employment;’’.

4 (e) DISREGARD OF INTEREST INCOME.—Section

5 402(a)(8)(A) (42 U.S.C. 602(a)(8)(A)), as amended by

6 subsection (c) of this section, is amended—

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

8 and

9 (2) by inserting after clause (ix) the following

10 new clause:

11 ‘‘(x) at the option of the State (on a state12 wide basis or in a defined area of the State),

13 may disregard all interest income of any child

14 or relative applying for or receiving aid to fami15 lies with dependent children, or of any other in16 dividual (living in the same home as such rel17 ative and child) whose needs are taken into ac18 count in making such a determination; and’’.

19 (f) DISREGARD OF INCOME AND RESOURCES DES20 IGNATED FOR EDUCATION, TRAINING, AND EMPLOY21 ABILITY.—

22 (1) DISREGARD AS RESOURCE.—Section

23 402(a)(7)(B) (42 U.S.C. 602(a)(7)(B)) is amend24 ed—

25 (A) by striking ‘‘or’’ before ‘‘(iv)’’; and
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1 (B) by inserting ‘‘, or (v) at the option of

2 the State (on a statewide basis or in a defined

3 area of the State), in the case of a family re4 ceiving aid under the State plan (and a family

5 not receiving such aid but which received such

6 aid in at least 1 of the preceding 4 months or

7 became ineligible for such aid during the pre8 ceding 12 months because of excessive earn9 ings), any amount not to exceed $10,000 in a

10 qualified asset account (as such term is defined

11 in section 406(k)) of such family, reduced by

12 the amount (if any) excluded from the resources

13 of the family pursuant to paragraph (46)(A)(i)’’

14 before ‘‘; and’’.

15 (2) DISREGARD AS INCOME.—

16 (A) NONRECURRING LUMP SUM EXEMPT

17 FROM LUMP-SUM RULE.—Section 402(a)(17)

18 (42 U.S.C. 602(a)(17)) is amended by adding

19 at the end the following: ‘‘; at the option of the

20 State (on a statewide basis or in a defined area

21 of the State), that this paragraph shall not

22 apply to earned or unearned income received in

23 a month on a nonrecurring basis to the extent

24 that such income is placed in a qualified asset

25 account (as defined in section 406(k)) the total
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1 amounts in which, after such placement, does

2 not exceed $10,000;’’.

3 (B) TREATMENT AS INCOME.—Section

4 402(a)(7) (42 U.S.C. 602(a)(7)) is amended—

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

6 subparagraph (B);

7 (ii) by striking the semicolon at the

8 end of subparagraph (C) and inserting ‘‘;

9 and’’; and

10 (iii) by adding at the end the follow11 ing new subparagraph:

12 ‘‘(D) shall treat as income any distribu13 tions from a qualified asset account (as defined

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

15 definition of a qualified distribution under sec16 tion 406(k)(2);’’.

17 (3) QUALIFIED ASSET ACCOUNTS.—Section 406

18 (42 U.S.C. 606), as amended by section 101(b) of

19 this Act, is amended by adding at the end the fol20 lowing new subsection:

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

22 mechanism approved by the State (such as individual re23 tirement accounts, escrow accounts, or savings bonds) that

24 allows savings of a family receiving aid to families with

25 dependent children to be used for qualified distributions.
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1 ‘‘(2) The term ‘qualified distributions’ means dis2 tributions for expenses directly related to 1 or more of

3 the following purposes:

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

5 at any education or training program.

6 ‘‘(B) The improvement of the employability (in7 cluding self-employment) of a member of the family

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

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

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

11 (g) DISREGARD OF INCOME AND RESOURCES RELAT12 ED TO SELF-EMPLOYMENT.—

13 (1) STATE PLAN REQUIREMENTS.—Section

14 402(a) (42 U.S.C. 602(a)) is amended—

15 (A) by striking ‘‘and’’ at the end of para16 graph (44);

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

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

19 (C) by inserting after paragraph (45) the

20 following new paragraph:

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

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

23 the State agency for a period not to exceed 2

24 years—
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1 ‘‘(A)(i) shall not include as a resource of

2 the family of which a child referred to in para3 graph (7)(A) is a member, for purposes of

4 paragraph (7)(B), the lesser of—

5 ‘‘(I) the first $10,000 of the net

6 worth (assets reduced by liabilities with re7 spect thereto) of all microenterprises (as

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

9 whole or in part, by the child or by a rel10 ative or other individual referred to in

11 paragraph (7)(A), or

12 ‘‘(II) such net worth attributable to

13 such ownership; and

14 ‘‘(ii) shall take into consideration as

15 earned income of the family of which the child

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

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

18 ‘‘(B) shall ensure that caseworkers are

19 able to properly advise recipients of aid under

20 the State plan of the option of microenterprise

21 as a legitimate route toward self-sufficiency,

22 and that caseworkers encourage recipients of

23 such aid who are interested in starting a

24 microenterprise to participate in a program de25 signed to assist them in such effort.’’.
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1 (2) DEFINITIONS.—Section 406 (42 U.S.C.

2 606), as amended by section 101(b) of this Act and

3 subsection (f)(3) of this section, is amended by add4 ing at the end the following new subsection:

5 ‘‘(l)(1) The term ‘microenterprise’ means a commer6 cial enterprise which has 5 or fewer employees, 1 or more

7 of whom owns the enterprise.

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

9 a microenterprise, the gross receipts of the business,

10 minus—

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

12 to the microenterprise;

13 ‘‘(B) transportation expenses;

14 ‘‘(C) inventory costs;

15 ‘‘(D) expenditures to purchase capital equip16 ment;

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

18 future use by the business;

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

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

21 of insurance against loss—

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

23 and

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

25 that are not reimbursed by the insurer solely by
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1 reason of the existence of a deductible with re2 spect to the insurance policy;

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

4 vehicle necessary for the conduct of the business;

5 and

6 ‘‘(I) the other expenses of the business.’’.

7 (3) INCLUSION OF MICROENTERPRISE TRAINING

8 AND ACTIVITIES IN THE JOBS PROGRAM.—

9 (A) IN GENERAL.—Section 482(d)(1) (42

10 U.S.C. 682(d)(1)) is amended by adding at the

11 end the following new subparagraph:

12 ‘‘(C) The services and activities referred to in sub13 paragraph (A)—

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

15 percent of the adult recipients of aid under the State

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

17 immediately preceding fiscal year) elect to partici18 pate in microenterprise activities, shall include pro19 grams described in paragraph (4); or

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

21 3 percent of the adult recipients of such aid (as of

22 such time) elect to participate in microenterprise ac23 tivities, may include programs described in para24 graph (4).’’.
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1 (B) MICROENTERPRISE PROGRAMS.—Sec2 tion 482(d) (42 U.S.C. 682(d)) is amended by

3 adding at the end the following:

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

5 programs of public and private organizations, agencies,

6 and other entities (including nonprofit and for-profit enti7 ties) to enable such entities to facilitate economic develop8 ment by—

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

10 business support services (including assistance, ad11 vice, and support relating to business planning, fi12 nancing, marketing, and other microenterprise devel13 opment activities) to owners of microenterprises and

14 persons developing microenterprises; and

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

16 support and self-esteem programs) to owners of

17 microenterprises and persons developing

18 microenterprises.’’.

19 (h) EXTENSION OF TRANSITIONAL CHILD CARE.—

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

21 amended by striking ‘‘12 months’’ and inserting ‘‘24

22 months’’.

23 (i) EFFECTIVE DATE.—Except as provided in section

24 111, the amendments made by this section shall take ef-
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1 fect on the first day of the first fiscal year beginning after

2 the date of the enactment of this Act.

3 SEC. 103. OPTIONAL STATE DISREGARD OF DEPENDENT

4 CHILD’S INCOME.

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

6 602(a)(8)), as amended by subsections (c) and (e) of sec7 tion 102 of this Act, is amended—

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

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

10 clause (x) and inserting ‘‘; and’’; and

11 (3) by inserting after clause (x) the following

12 new clause:

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

15 may disregard all or any part of the earned in16 come of a dependent child; and’’.

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

18 this section shall take effect on the first day of the first

19 fiscal year beginning after the date of the enactment of

20 this Act.

21 SEC. 104. FAMILY STABILITY.

22 (a) EQUIVALENT TREATMENT OF STEPPARENT IN23 COME AND PARENT INCOME.—Section 402(a)(31) (42

24 U.S.C. 602(a)(31)) is amended—
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1 (1) in subparagraph (A), by inserting ‘‘, or at

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

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

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

5 at the end;

6 (2) by striking ‘‘and’’ at the end of subpara7 graph (C); and

8 (3) by striking the semicolon at the end of sub9 paragraph (D) and inserting ‘‘, (E) an amount equal

10 to the expenditure for care in such month for a de11 pendent child of the stepparent who is living in the

12 same home as the stepparent, not receiving aid to

13 families for dependent children, and requiring care

14 for such month to the extent that such amount (for

15 each such dependent child) does not exceed $175 (or

16 such lesser amount as the Secretary may prescribe

17 in the case of an individual not engaged in full-time

18 employment, or not employed throughout the

19 month), or, in the case such child is under age 2,

20 $200, and (F) at the option of the State (on a state21 wide basis or in a defined area of the State), up to

22 one-half of the total of such earned income not dis23 regarded under any other subparagraph of this para24 graph;’’.

25 (b) UNEMPLOYED PARENT HOUSEHOLDS.—
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1 (1) ELIMINATION OF PRINCIPAL EARNER RE2 QUIREMENT.—

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

4 607) is amended—

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

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

7 inserting ‘‘of either parent in a home in

8 which both parents of such child are liv9 ing’’;

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

11 principal earner’’ in subsection

12 (b)(2)(B)(ii)(II) and inserting ‘‘either par13 ent’’;

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

15 paragraph (3) of subsection (d) and insert16 ing a period; and

17 (iv) by striking paragraph (4) of sub18 section (d).

19 (B) CONFORMING AMENDMENT.—Section

20 402(a)(19)(D) (42 U.S.C. 602(a)(19)(D)) is

21 amended by striking ‘‘the parent who is the

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

23 (2) MODIFICATION OF OTHER REQUIRE24 MENTS.—Subparagraph (A) of section 407(b)(1) (42

25 U.S.C. 607(b)(1)) is amended to read as follows:
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1 ‘‘(A) subject to paragraph (2), shall require the

2 payment of aid to families with dependent children

3 with respect to a dependent child as defined in sub4 section (a) when—

5 ‘‘(i) for at least 30 days—

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

7 parent has been employed for less than a

8 monthly cap specified by the State plan

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

10 of the application for aid, both parents are

11 employed for less than such monthly cap;

12 or

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

14 or both parents are employed for less than

15 the monthly cap established under

16 subclause (I),

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

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

19 30 days) as may be prescribed by the Secretary,

20 refused a bona fide offer of employment or

21 training for employment, and

22 ‘‘(iii) notwithstanding the number of hours

23 either such parent is working after the initial

24 determination of eligibility, such family remains
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1 otherwise eligible for payment under this sec2 tion; and’’.

3 (c) INCREASE IN ASSET LIMITS.—Section

4 402(a)(7)(B) (42 U.S.C. 602(a)(7)(B)) is amended in the

5 matter preceding clause (i) by inserting ‘‘(or, at the option

6 of the State (on a statewide basis or in a defined area

7 of the State), exceeds an amount prescribed by the State

8 not to exceed $2,000 for applicant families and $5,000

9 for recipient families)’’ after ‘‘may determine’’.

10 (d) INCREASE IN MOTOR VEHICLE LIMIT.—Section

11 402(a)(7)(B) (42 U.S.C. 602(a)(7)(B)), as amended by

12 section 102(f) of this Act, is amended—

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

14 the family member’s ownership interest in one auto15 mobile as does not exceed such amount as the Sec16 retary may prescribe’’;

17 (2) by striking ‘‘or’’ at the end of clause (iv);

18 and

19 (3) by striking ‘‘; and’’ at the end of clause (v)

20 and inserting ‘‘, or (vi) the greater of so much of the

21 family member’s ownership interest in 1 automobile

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

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

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

25 an amount not to exceed $3,000, adjusted on Octo-
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1 ber 1 of each year (beginning in 1994) to equal the

2 amount determined under this subclause for the pre3 vious fiscal year plus the product of such amount

4 and the increase in the Consumer Price Index for

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

6 (e) EFFECTIVE DATE.—Except as provided in section

7 111, the amendments made by this section shall take ef8 fect on the first day of the first fiscal year beginning after

9 the date of the enactment of this Act.

10 SEC. 105. WORK REQUIREMENTS FOR UNEMPLOYED PAR11 ENTS.

12 (a) ELIMINATION OF REQUIRED PARTICIPATION OF

13 ONE PARENT IN WORK COMPONENT OF JOBS PRO14 GRAM.—Section 403(l) (42 U.S.C. 603(l)) is amended by

15 striking paragraph (4).

16 (b) REQUIRED PARTICIPATION OF BOTH PAR17 ENTS.—Section 407(b)(2)(A) (42 U.S.C. 607(b)(2)(A)) is

18 amended to read as follows:

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

20 section, a State may condition continued eligibility for aid

21 to families with dependent children by reason of the unem22 ployment of either parent, on the participation of both

23 parents in a program established by the State agency

24 which shall include job search activities, counseling, and

25 training services when the State agency determines that
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1 such participation is required, except as provided in clause

2 (ii).

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

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

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

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

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

8 (c) EFFECTIVE DATE.—The amendments made by

9 this section shall take effect on the first day of the first

10 fiscal year beginning after the date of the enactment of

11 this Act.

12 SEC. 106. JOBS PROGRAM.

13 (a) REQUIREMENT OF JOBS PARTICIPATION OF

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

15 U.S.C. 602(a)(19)(C)) is amended—

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

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

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

19 (b) NO LIMITATION ON LENGTH OF JOB SEARCH

20 PROGRAM.—Section 482(g)(2) (42 U.S.C. 682(g)(2)) is

21 amended by striking ‘‘402(a)(19)(D) applies’’ through the

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

23 applies.’’.

24 (c) PROTECTION OF EXISTING WORKERS.—
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1 (1) NONDISPLACEMENT.—Section 484(c) (42

2 U.S.C. 684(c)) is amended by—

3 (A) by striking ‘‘or’’ at the end of para4 graph (2);

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

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

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

8 following new paragraph:

9 ‘‘(4) the employment or assignment of a partici10 pant or the filling of a position if such participant

11 will perform any services or duties, or engage in ac12 tivities, that—

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

14 workers;

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

16 respect to which an individual has recall rights

17 pursuant to a collective bargaining agreement

18 or applicable personnel procedures; or

19 ‘‘(C) had been performed by or were as20 signed to any employee who—

21 ‘‘(i) is subject to a reduction in force;

22 or

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

24 collective bargaining agreement or applica25 ble personnel procedures.’’.
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1 (2) CONCURRENCE OF LOCAL LABOR ORGANIZA2 TION.—Section 484 (42 U.S.C. 684) is amended by

3 adding at the end the following new subsection:

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

5 be made until the State agency has obtained from an em6 ployer with whom a participant is placed, the written con7 currence of any local labor organization representing em8 ployees of the employer who are engaged in the same or

9 substantially similar work as that proposed to be carried

10 out.’’.

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

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

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

14 grievance procedure for resolving complaints by regular

15 employees or such employees’ representatives that the

16 work assignment of an individual under the program vio17 lates any of the prohibitions described in subsection (c).

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

19 criminal activity, a grievance shall be made not later than

20 1 year after the date of the alleged occurrence of the event

21 that is the subject of the grievance.

22 ‘‘(C)(i) A hearing on any grievance conducted under

23 this paragraph shall be conducted not later than 30 days

24 after the filing of such grievance.
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1 ‘‘(ii) A decision on any such grievance shall be made

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

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

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

5 60 days after the filing of such grievance if no decision

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

7 such grievance to binding arbitration before a qualified ar8 bitrator who is jointly selected and independent of the in9 terested parties.

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

11 Governor shall appoint an arbitrator from a list of quali12 fied arbitrators within 15 days after receiving a request

13 for such appointment from one of the parties to the griev14 ance.

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

16 than 45 days after the request for such arbitration pro17 ceeding, or, if the arbitrator is appointed by the Governor

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

19 after the appointment of such arbitrator.

20 ‘‘(iii) A decision concerning a grievance shall be made

21 not later than 30 days after the date such arbitration pro22 ceeding begins.

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

24 of an arbitration proceeding shall be divided evenly be25 tween the parties to the arbitration.
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1 ‘‘(II) If a regular employee or such employee’s rep2 resentative prevails under a binding arbitration proceed3 ing, the State agency shall pay the total cost of such pro4 ceeding and the attorneys’ fees of such employee or rep5 resentative.

6 ‘‘(E) Remedies for a grievance filed under this para7 graph include—

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

9 program under this part; and

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

11 to the position held by such employee prior to dis12 placement;

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

14 displaced employee;

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

16 conditions, and privileges of employment of the dis17 placed employee; and

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

19 make the displaced employee whole.

20 ‘‘(F) Suits to enforce arbitration awards under this

21 paragraph may be brought in any district court of the

22 United States having jurisdiction of the parties, without

23 regard to the amount in controversy and without regard

24 to the citizenship of the parties.’’.
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1 (e) EFFECTIVE DATE.—Except as provided in section

2 111, the amendments made by this section shall take ef3 fect on the first day of the first fiscal year beginning after

4 the date of the enactment of this Act.

5 SEC. 107. INCREASED PAYMENTS TO STATES.

6 (a) CHANGES TO JOBS PAYMENT FORMULA.—

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

8 U.S.C. 603(l)(1)(A)) is amended—

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

10 (i);

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

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

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

14 do not exceed the amount of such expenditures

15 in fiscal year 1994’’;

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

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

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

19 clause:

20 ‘‘(iii) with respect to so much of the expendi21 tures in a fiscal year that exceed the sum of the

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

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

24 described in clause (i)(II), and
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1 ‘‘(II) in the case of expenditures made by

2 a State in operating such a program for a fiscal

3 year (other than for costs described in

4 subclause (I)), the greater of—

5 ‘‘(aa) 70 percent, or

6 ‘‘(bb) the Federal medical assistance

7 percentage (as defined in section 1118 in

8 the case of any State to which section

9 1108 applies, or as defined in section

10 1905(b) in the case of any other State).’’.

11 (2) EFFECTIVE DATE.—The amendments made

12 by paragraph (1) shall apply with respect to pay13 ments made on and after October 1, 1994.

14 (b) INCREASE IN JOBS PROGRAM AUTHORIZA15 TION.—Section 403(k)(3) (42 U.S.C. 603(k)(3)) is

16 amended—

17 (1) by striking subparagraphs (E) and (F); and

18 (2) by inserting after subparagraph (D) the fol19 lowing new subparagraphs:

20 ‘‘(E) $1,500,000,000 in the case of fiscal year

21 1995,

22 ‘‘(F) $2,000,000,000 in the case of fiscal year

23 1996,

24 ‘‘(G) $2,500,000,000 in the case of fiscal year

25 1997,
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1 ‘‘(H) $3,000,000,000 in the case of fiscal year

2 1998, and

3 ‘‘(I) $3,500,000,000 in the case of fiscal year

4 1999.’’.

5 (c) INCREASE IN CHILD CARE PAYMENT FOR6 MULA.—

7 (1) IN GENERAL.—

8 (A) INCREASED PERCENTAGE.—Section

9 402(g)(3)(A)(i) of the Social Security Act (42

10 U.S.C. 602(g)(3)(A)(i)) is amended to read as

11 follows:

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

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

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

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

16 ‘‘(I) with respect to so much of such expendi17 tures as does not exceed the State’s expenditures in

18 the fiscal year 1994, the Federal medical assistance

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

20 ‘‘(II) with respect to so much of such expendi21 tures as exceed the amount described in subclause

22 (I), the sum of—

23 ‘‘(aa) the Federal medical assistance per24 centage (as defined in section 1905(b)), and
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1 ‘‘(bb) one-half of the difference between

2 100 percent and such Federal medical assist3 ance percentage.’’.

4 (B) EFFECTIVE DATE.—The amendments

5 made by subparagraph (A) shall apply with re6 spect to payments made on and after October

7 1, 1994.

8 (2) CONFORMING AMENDMENTS.—

9 (A) IN GENERAL.—Section 402(g)(3)(A)(i)

10 of the Social Security Act (42 U.S.C.

11 602(g)(3)(A)(i)), as amended by paragraph

12 (1)(A) of this subsection, is amended—

13 (i) by striking ‘‘(i)’’ after ‘‘(A)’’;

14 (ii) by striking ‘‘subclause (I)’’ in

15 subclause (II) and inserting ‘‘clause (i)’’;

16 (iii) by redesignating subclauses (I)

17 and (II) as clauses (i) and (ii), respec18 tively; and

19 (iv) by redesignating items (aa) and

20 (bb) as subclauses (I) and (II), respec21 tively.

22 (B) EFFECTIVE DATE.—The amendments

23 made by subparagraph (A) shall take effect on

24 September 30, 1998.
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1 SEC. 108. ASSESSMENT, MONITORING, AND EVALUATION.

2 (a) IN GENERAL.—Section 402(a) (42 U.S.C.

3 602(a)), as amended by section 102(g)(1) of this Act, is

4 amended—

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

6 (45);

7 (2) by striking the period at the end of para8 graph (46) and inserting ‘‘; and’’; and

9 (3) by inserting after paragraph (46) the fol10 lowing new paragraph:

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

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

13 the State agency (in order to increase the percentage

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

15 ‘‘(A) shall conduct an assessment, in con16 sultation with State and local elected officials,

17 current recipients of aid to families with de18 pendent children, recipients of community-based

19 service systems, and individuals with expertise

20 in business, education, child welfare, juvenile

21 justice, mental health, substance addiction,

22 housing, and labor—

23 ‘‘(i) of the barriers which families that

24 receive aid to families with dependent chil25 dren face in achieving self-sufficiency, in26 cluding noneconomic barriers such as fam-
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1 ily functions, parenting capacity, child de2 velopment, housing, substance abuse, and

3 mental illness;

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

5 to provide employment opportunities to

6 families that receive aid to families with

7 dependent children and to address other

8 barriers such families face to achieving

9 self-sufficiency; and

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

11 workers needed to develop the family in12 vestment program under paragraph (29),

13 monitor progress, and adapt goals to meet

14 new challenges;

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

16 and evaluate both the economic gains related to

17 employment of individuals in households receiv18 ing aid to families with dependent children and

19 the social, health, educational, and developmen20 tal impact on children in such households that

21 result from efforts to achieve self-sufficiency;

22 and

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

24 the number of individuals who achieve self-suffi25 ciency through the family investment program
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1 under paragraph (29) and the rate of recidi2 vism.’’.

3 (b) EFFECTIVE DATE.—Except as provided in sec4 tion 111, the amendments made by this section shall take

5 effect on the first day of the first fiscal year beginning

6 after the date of the enactment of this Act.

7 SEC. 109. TIMELY PREVENTIVE HEALTH CARE FOR CHIL8 DREN.

9 (a) IN GENERAL.—Section 402(a) (42 U.S.C.

10 602(a)), as amended by section 102(g)(1) and 108(a) of

11 this Act, is amended—

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

13 (46);

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

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

18 ‘‘(48) provide that (unless the State agency

19 provides the Secretary with adequate certification

20 that the care described in subparagraph (A)(i)(I) is

21 not accessible in the area in which a family re22 sides)—

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

24 amount of aid paid to a family under this part

25 (determined without regard to subparagraph
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1 (B)) by a percentage amount determined appro2 priate by the Secretary beginning in the month

3 following any month in which the State agency

4 has failed to receive—

5 ‘‘(I) written verification that each

6 child in the family under 6 years of age

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

9 guidelines issued by the Surgeon General

10 of the Public Health Service; or

11 ‘‘(II) notice of a medical justification

12 that would exempt the child or children

13 from receiving such care; and

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

15 payment under clause (i) beginning in the

16 month following the month in which the State

17 agency receives the required verification; and

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

19 be increased by a bonus payment equal to the

20 percentage amount determined by the Secretary

21 under subparagraph (A) in the month following

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

24 immunizations and care described in subpara25 graph (A)(i).’’.
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1 (b) EFFECTIVE DATE.—Except as provided in sec2 tion 111, the amendments made by this section shall take

3 effect on the first day of the first fiscal year beginning

4 after the date of the enactment of this Act.

5 SEC. 110. WAGE SUPPLEMENTATION DEMONSTRATION

6 PROJECTS.

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

8 Human Services (hereafter in this section referred to as

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

10 the purpose of developing a wage supplementation pro11 gram under which—

12 (1) certain individuals eligible for aid to fami13 lies with dependent children under title IV of the So14 cial Security Act (42 U.S.C. 601 et seq.) would be

15 given an incentive to work; and

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

17 benefits described in paragraph (1) and food stamp

18 benefits under the Food Stamp Act of 1977 (7

19 U.S.C. 2011 et seq.) to make monthly incentive pay20 ments (in lieu of such benefits) to such individuals.

21 Each such program shall meet the requirements of sub22 section (b).

23 (b) WAGE SUPPLEMENTATION DEMONSTRATION

24 PROJECT.—
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1 (1) IN GENERAL.—A demonstration project

2 conducted under this section shall provide the follow3 ing:

4 (A) INCENTIVES TO WORK.—The project

5 shall—

6 (i) require as a condition of participa7 tion in the project that an eligible individ8 ual be employed by a participating em9 ployer;

10 (ii) provide that the State shall make

11 monthly incentive payments to any eligible

12 individual for each month of employment

13 in an amount equal to the benefits de14 scribed in subsection (a)(2) which would

15 otherwise be payable to the individual, de16 termined as of the first day of the first full

17 month of employment of such individual by

18 a participating employer; and

19 (iii) provide that such payments be in

20 lieu of such benefits.

21 (B) PERIOD OF PARTICIPATION.—A

22 project shall not permit an eligible individual to

23 participate in the demonstration project for a

24 period in excess of the lesser of—
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1 (i) an aggregate period of 48 months,

2 or

3 (ii) a period consisting of the number

4 of months in which such individual was

5 employed by a participating employer.

6 (C) INCOME IN EXCESS OF LIMIT.—The

7 project shall set a limit (to be determined by

8 the State) on the monthly income (including

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

10 family of an eligible individual and shall permit

11 the State to—

12 (i) reduce payments under subpara13 graph (A)(ii) in excess of the limit; or

14 (ii) determine an individual ineligible

15 for participation in the project if such in16 come is in excess of the limit.

17 (2) SPECIAL RULES FOR TREATMENT UNDER

18 FEDERAL PROGRAMS.—Notwithstanding any other

19 provision of law, the following special rules shall

20 apply to an eligible individual participating in the

21 project:

22 (A) WAGES AS EARNED INCOME.—Wages

23 paid to an eligible individual by a participating

24 employer (but not payments under the project)

25 shall be considered earned income.
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1 (B) TREATED AS ELIGIBLES.—Except for

2 purposes of determining eligibility for benefits

3 for which payments under the project are in

4 lieu of, an eligible individual participating in the

5 project shall be treated as eligible—

6 (i) for aid to families with dependent

7 children under part A of title IV of the So8 cial Security Act (42 U.S.C. 601 et seq.);

9 and

10 (ii) for food stamp benefits under the

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

12 et seq.) if such individual was otherwise el13 igible for food stamp benefits, determined

14 as of the first day of the first full month

15 of the employment of such individual by a

16 employer.

17 (C) ADDITIONAL CHILD SUPPORT

18 AMOUNTS.—An eligible individual who partici19 pates in the demonstration project shall remain

20 eligible for the project notwithstanding the re21 ceipt of any amounts paid to the family of the

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

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

24 (D) HOUSING.—Any wages paid to an eli25 gible individual by a participating employer dur-
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1 ing the period of time that an eligible individual

2 participates in the demonstration project shall

3 not be taken into account in determining—

4 (i) the monthly rent under section

5 3(a) of the United States Housing Act of

6 1937 for any family residing in a dwelling

7 unit assisted under such Act; and

8 (ii) the monthly assistance payment

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

10 such Act.

11 (3) ELIGIBLE INDIVIDUAL AND PARTICIPATING

12 EMPLOYER.—

13 (A) ELIGIBLE INDIVIDUAL.—For purposes

14 of this section, an individual is an eligible indi15 vidual if the individual is in a category of indi16 viduals which the State determines should be el17 igible to participate in the demonstration

18 project, and who would, at the time of place19 ment in the job involved, be eligible for aid to

20 families with dependent children under an ap21 proved State plan under title IV of the Social

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

23 (B) PARTICIPATING EMPLOYER.—

24 (i) IN GENERAL.—For purposes of

25 this section, an employer is a participating
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1 employer, with respect to an eligible indi2 vidual, if the employer provides the State

3 with a written agreement certifying—

4 (I) that the employment of the

5 eligible individual complies with the

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

7 (d), and (g) of section 484 of the So8 cial Security Act (42 U.S.C. 684);

9 (II) that the gross wages (as de10 fined in section 209 of the Social Se11 curity Act (42 U.S.C. 609) deter12 mined without regard to any dollar

13 limitation) paid to such eligible indi14 vidual by the employer during any

15 month will not be less than the prod16 uct of—

17 (aa) the greater of the Fed18 eral minimum wage or the appli19 cable State minimum wage, and

20 (bb) the number of hours

21 worked by such individual;

22 (III) that the employer will not

23 receive any wage subsidy under any

24 other provision of Federal law, includ25 ing part F of title IV of the Social Se-
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1 curity Act with respect to the employ2 ment of such eligible individual; and

3 (IV) that the eligible individual

4 receives the same employer-provided

5 benefits (other than health care bene6 fits) that other employees of the em7 ployer receive.

8 (ii) CONTINUING CERTIFICATION RE9 QUIREMENT.—A participating employer

10 shall be required to submit a monthly re11 port to the State (in a form and in such

12 manner as the State requires) certifying

13 that the employer has complied with the

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

15 and (IV) of clause (i) with respect to an el16 igible individual during the period such in17 dividual participates under the project.

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

19 Act shall be conducted for not more than 5 years (includ20 ing any time necessary for final evaluation and reporting).

21 The Secretary may terminate a project if the Secretary

22 determines that the State conducting the project is not

23 in substantial compliance with the terms of the application

24 approved by the Secretary under this section.

25 (d) APPLICATIONS.—
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1 (1) IN GENERAL.—Each State desiring to con2 duct a demonstration project under this section shall

3 prepare and submit to the Secretary an application,

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

5 information as the Secretary may require, including

6 an explanation of a plan for evaluating the project.

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

8 submits an application under paragraph (1) may

9 begin a demonstration project under this section—

10 (A) upon approval of such application by

11 the Secretary; or

12 (B) at the end of the 60-day period begin13 ning on the date such application is submitted,

14 unless the Secretary denies the application dur15 ing such period.

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

17 issue a public notice on the date the State submits

18 an application under paragraph (1) which contains

19 a general description of the proposed demonstration

20 project. Any interested party may comment on the

21 proposed demonstration project to the State or the

22 Secretary during the 30-day period beginning on the

23 date the public notice is issued.

24 (e) EVALUATIONS.—Each State conducting a dem25 onstration project under this section shall submit to the
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1 Secretary an annual and final evaluation that determines

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

3 section in moving people from welfare dependency to self4 sufficiency.

5 (f) FUNDING FOR DEMONSTRATION PROJECTS.—For

6 each State that conducts a demonstration project under

7 this section—

8 (1) the portion of the monthly payments that

9 the State makes to a participant in the project

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

11 aid to families with dependent children under part A

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

13 et seq.) shall be considered expenditures under the

14 State plan for such aid;

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

16 administration of the demonstration project shall be

17 considered expenditures by the State for administra18 tive costs in operating a program under part F of

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

20 et seq.); and

21 (3) the portion of the monthly payments that

22 the State makes to a participant in the project that

23 is attributable to the cash value of food stamp bene24 fits under the Food Stamp Act of 1977 (7 U.S.C.
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1 2011 et seq.) shall be considered to be expenditures

2 for food stamp benefits under such Act.

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

4 for the activities covered by a demonstration project con5 ducted under this section shall supplement, and shall not

6 supplant, funds that are expended for similar purposes

7 under any State, regional, or local program.

8 SEC. 111. DELAY IN CERTAIN EFFECTIVE DATES.

9 In the case of a State that the Secretary of Health

10 and Human Services determines requires State legislation

11 (other than legislation appropriating funds) in order to

12 meet the additional requirements imposed by the amend13 ments made by section 101, 102, 104, 106, and 108, the

14 State shall not be regarded as failing to comply with the

15 requirements of such amendments before the first day of

16 the first calendar quarter beginning after the close of the

17 first regular session of the State legislature that begins

18 after October 1, 1994, if such State legislature did not

19 meet in a regular session after the date of the enactment

20 of this Act and before October 1, 1994. For purposes of

21 this subsection, in the case of a State that has a 2-year

22 legislative session, each year of the session shall be treated

23 as a separate regular session of the State legislature.
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1 TITLE II—IMPROVEMENTS IN

2 THE COLLECTION OF CHILD

3 SUPPORT

4 SEC. 201. TRANSMISSION AND ASSIGNMENT OF CERTAIN

5 CHILD SUPPORT ORDERS TO THE IRS.

6 Section 466(a) (42 U.S.C. 666(a)) is amended by in7 serting after paragraph (11) the following new paragraph:

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

9 court or administrative agency that issues or modi10 fies (or has issued or modified) a child support order

11 (including an order for the payment of past-due sup12 port) to transmit a copy of the order to the Internal

13 Revenue Service upon the completion of a 12-month

14 period during which less than 50 percent of the

15 court-ordered child support amount for such period

16 has been paid.

17 ‘‘(B) Procedures which—

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

19 to collect child support pursuant to an order is20 sued or modified in the State (whether before

21 or after the effective date of this paragraph) to

22 be presumed to have assigned to the Internal

23 Revenue Service the right to collect such sup24 port (including any past-due support) pursuant

25 to subparagraph (A), unless the individual af-
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1 firmatively elects to retain such right at any

2 time; and

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

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

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

6 SEC. 202. COLLECTION OF CHILD SUPPORT BY INTERNAL

7 REVENUE SERVICE.

8 (a) IN GENERAL.—Chapter 77 of the Internal Reve9 nue Code of 1986 (relating to miscellaneous provisions)

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

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

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

13 program to collect child support (including past-due sup14 port) pursuant to child support orders which are assigned

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

16 of the Social Security Act.

17 ‘‘(b) USE OF WAGE WITHHOLDING, ETC.—Such pro18 gram shall provide for the collection of child support re19 quired to be paid for any period through increases in wage

20 withholding under chapter 24 and estimated tax payments

21 under section 6654 during such period. Amounts required

22 to be paid through such withholding and payments shall

23 be treated as tax for purposes for this subtitle.

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

2 support required to be paid by any individual to the

3 Internal Revenue Service during any taxable year

4 shall be paid—

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

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

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

10 than such date, with such return, or

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

13 may by regulations prescribe.

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

15 amount required to be paid under paragraph (1)

16 shall be reduced by the aggregate payments of child

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

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

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

23 Secretary shall assess and collect the unpaid amount in

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

25 the same limitations applicable to a tax imposed by sub-
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1 title C the collection of which would be jeopardized by

2 delay, except that—

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

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

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

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

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

11 minor children.

12 ‘‘(e) COLLECTIONS DISPERSED TO INDIVIDUAL

13 SPECIFIED IN ORDER.—

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

17 individual entitled to such amounts under such order

18 as quickly as possible. Any penalties and interest

19 collected with respect to such amounts also shall be

20 paid to such individual.

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

23 whom—

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

3 ‘‘(B) an application for State assistance

4 under section 454(6) is in effect,

5 amounts collected under this section shall be paid to

6 such State pursuant to section 457 of such Act.

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

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

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

12 under section 6203,

13 all amounts collected shall be treated as collected pursuant

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

15 amount of such unpaid child support.

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

17 of the United States shall have jurisdiction to hear any

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

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

21 to review by the Secretary in an administrative proceeding.

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

23 administrative action against the State by an individual

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

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

2 under this section.

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

4 such regulations as may be appropriate to carry out the

5 purposes of this section.’’.

6 (b) ESTIMATE OF INCREASED INTERNAL REVENUE

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

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

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

12 by this section).

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

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

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

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

16 SEC. 203. PUBLICATION OF DELINQUENT CHILD SUPPORT

17 OBLIGORS.

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

19 ‘‘and’’ at the end of paragraph (23), by striking the period

20 at the end of paragraph (24) and inserting ‘‘; and’’, and

21 by inserting after paragraph (24) the following new para22 graph:

23 ‘‘(25) at the option of the State, provide that

24 with respect to any child support order enforced by

25 the State under this part in which no payment has
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1 been made during a preceding 3-month period, the

2 State make available for publication on a semi-an3 nual basis a listing of all such orders by name of the

4 support obligor, verified city and State address of

5 such obligor, and any other information deemed ap6 propriate by the State, and publicize the existence of

7 such listing to such support obligors.’’.

8 SEC. 204. EFFECTIVE DATE.

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

10 (b), the amendments made by this title shall take effect

11 on the first day of the first fiscal year beginning after the

12 date of the enactment of this Act.

13 (b) EXCEPTION.—In the case of a State that the Sec14 retary of Health and Human Services determines requires

15 State legislation (other than legislation appropriating

16 funds) in order to meet the additional requirements im17 posed by the amendments made by this title, the State

18 shall not be regarded as failing to comply with the require19 ments of such amendments before the first day of the first

20 calendar quarter beginning after the close of the first reg21 ular session of the State legislature that begins after Octo22 ber 1, 1994, if such State legislature did not meet in a

23 regular session after the date of the enactment of this Act

24 and before October 1, 1994. For purposes of this sub25 section, in the case of a State that has a 2-year legislative
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1 session, each year of the session shall be treated as a sepa2 rate regular session of the State legislature.

3 TITLE III—WELFARE

4 RESTRICTIONS FOR ALIENS

5 SEC. 301. ELIGIBILITY OF CERTAIN ALIENS FOR CERTAIN

6 FEDERAL BENEFITS.

7 (a) PROVISIONS RELATING TO UNLAWFUL

8 ALIENS.—

9 (1) DIRECT FEDERAL FINANCIAL BENEFITS.—

10 (A) IN GENERAL.—On and after the date

11 of the enactment of this Act, notwithstanding

12 any other provision of law, no benefits shall be

13 available under the programs described in sub14 paragraph (B) to an unlawful alien (as defined

15 in subsection (c)(2)) except pursuant to a provi16 sion of the Immigration and Nationality Act.

17 (B) PROGRAMS DESCRIBED.—The pro18 grams described in this subparagraph are the

19 following:

20 (i) The aid to families with dependent

21 children program under title IV of the So22 cial Security Act.

23 (ii) The medicaid program under title

24 XIX of the Social Security Act (except for

25 care and services for the treatment of an
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1 emergency medical condition under section

2 1903(v) of the Social Security Act).

3 (iii) The food stamp program under

4 the Food Stamp Act of 1977.

5 (iv) The supplemental security income

6 program under title XVI of the Social Se7 curity Act.

8 (v) Any Federal unemployment com9 pensation program.

10 (2) NOTIFICATION OF ALIENS.—The Federal

11 agency administering a program referred to in para12 graph (1)(B) shall, directly or through the States,

13 notify any unlawful alien (as defined in subsection

14 (c)(2)) who is receiving benefits under the program

15 on the date of the enactment of this Act and whose

16 eligibility for the program is or will be terminated by

17 reason of this subsection.

18 (b) PROVISIONS RELATING TO LAWFUL ALIENS.—

19 (1) REPORTING BY FEDERAL AGENCIES.—On

20 and after the date of the enactment of this Act, not21 withstanding any other provision of law, any lawful

22 alien (as defined in subsection (c)(1)) who receives

23 benefits under a program described in subsection

24 (a)(1)(B) for more than 12 months shall be reported

25 to the Immigration and Naturalization Service and
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1 shall be treated as a public charge for purposes of

2 section 241(a)(5) of the Immigration and National3 ity Act.

4 (2) ATTRIBUTION OF SPONSOR’S INCOME AND

5 RESOURCES TO FAMILY PREFERENCE ALIENS.—On

6 and after the date of the enactment of this Act, not7 withstanding any other provision of law, for pur8 poses of determining eligibility of, and the amount

9 of benefits for, a lawful alien (as defined in sub10 section (c)(1)) under a program described in sub11 section (a)(1)(B)—

12 (A) the income and resources of any per13 son who, as a sponsor of such alien’s entry into

14 the United States, executed an affidavit of sup15 port or similar agreement with respect to such

16 alien, and

17 (B) the income and resources of such

18 sponsor’s spouse,

19 shall be deemed to be the unearned income and re20 sources of such alien until such time as the alien

21 achieves United States citizenship through natu22 ralization pursuant to chapter 2 of title 3 of the Im23 migration and Nationality Act.

24 (c) DEFINITIONS.—For the purposes of this sec25 tion—
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1 (1) LAWFUL ALIEN.—

2 (A) IN GENERAL.—The term ‘‘lawful

3 alien’’ means an individual who is described in

4 subparagraph (B) at the time the individual ap5 plies for, receives, or attempts to receive any

6 Federal benefit.

7 (B) INDIVIDUALS DESCRIBED.—An indi8 vidual described in this subparagraph is—

9 (i) a national of the United States,

10 (ii) an alien lawfully admitted for per11 manent residence,

12 (iii) an asylee,

13 (iv) a refugee,

14 (v) an alien whose deportation has

15 been withheld under section 243(h) of the

16 Immigration and Nationality Act, or

17 (vi) a parolee who has been paroled

18 for a period of 1 year or more.

19 (2) UNLAWFUL ALIEN.—The term ‘‘unlawful

20 alien’’ means an individual who is not—

21 (A) a United States citizen; or

22 (B) an individual described in paragraph

23 (1)(B) at the time the individual applies for, re24 ceives, or attempts to receive any Federal bene25 fit.
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1 SEC. 302. STATE AFDC AGENCIES REQUIRED TO PROVIDE

2 INFORMATION ON ILLEGAL ALIENS TO THE

3 IMMIGRATION AND NATURALIZATION SERV4 ICE.

5 (a) IN GENERAL.—Section 402(a) (42 U.S.C.

6 602(a)), as amended by sections 102(g)(1), 108(a), and

7 109(a) of this Act, is amended—

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

9 (47);

10 (2) by striking the period at the end of para11 graph (48) and inserting ‘‘; and’’; and

12 (3) by inserting after paragraph (48) the fol13 lowing new paragraph:

14 ‘‘(49) require the State agency to provide to the

15 Immigration and Naturalization Service the name,

16 address, and other identifying information that the

17 agency has with respect to any individual unlawfully

18 in the United States any of whose children is a citi19 zen of the United States.’’.

20 (b) EFFECTIVE DATE.—

21 (1) IN GENERAL.—Except as provided in para22 graph (2), the amendment made by subsection (a)

23 shall take effect on the first day of the first fiscal

24 year beginning after the date of the enactment of

25 this Act.
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1 (2) DELAY PERMITTED IF STATE LEGISLATION

2 REQUIRED.—In the case of a State plan approved

3 under section 402(a) of the Social Security Act

4 which the Secretary of Health and Human Services

5 determines requires State legislation (other than leg6 islation appropriating funds) in order for the plan to

7 meet the additional requirement imposed by the

8 amendment made by subsection (a) of this section,

9 the State plan shall not be regarded as failing to

10 comply with the requirements of such section 402(a)

11 solely on the basis of the failure of the plan to meet

12 such additional requirement before the end of the 2-

13 year period that begins with the date of the enact14 ment of this Act.

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