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SECTION 10. TITLE XX SOCIAL SERVICES

BLOCK GRANT PROGRAM

CONTENTS

Overview, Allocation Formula, and Funding

Program Goals

Data on Services, Recipients, and Expenditures

Transfer of Funds Among Block Grants

Social Services in Empowerment Zones and Enterprise

Communities

Legislative History

OVERVIEW, ALLOCATION FORMULA, AND FUNDING

Title XX of the Social Security Act, also referred to as the Social

Services Block Grant (SSBG), is a capped entitlement program.

Thus, States are entitled to their share, according to a formula, of

a nationwide funding ceiling or ‘‘cap,’’ which is specified in statute.

Block grant funds are given to States to help them achieve a wide

range of social policy goals, which include preventing child abuse,

increasing the availability of child care, and providing communitybased care for the elderly and disabled. Funds are allocated to the

States on the basis of population. The allotments for Puerto Rico,

Guam, the Virgin Islands and the Northern Marianas from the national total are based on their allocation for fiscal year 1981 adjusted to reflect the new total funding level. The Omnibus Budget

Reconciliation Act (OBRA) of 1987 (Public Law 100–203) extended

eligibility for title XX funds to American Samoa. The Federal funds

are available to States without a State matching requirement.

Title XX of the Social Security Act was created in 1975 (Public

Law 93–647); however, it was OBRA 1981 (Public Law 97–35) that

amended title XX to establish a ‘‘block grant to States for social

services.’’ The entitlement ceiling, or cap, was cut from the fiscal

year 1981 level of $2.9 billion to $2.4 billion for fiscal year 1982.

Table 10–1 shows appropriated amounts in fiscal years 1982–2000,

as well as the entitlement ceilings established through fiscal year

2001. The table’s footnotes, as well as the legislative history section

of this chapter, elaborate on instances in which the appropriated

amount for the program in a given year differed from the entitlement ceiling established for that year in statute. In these cases, appropriations legislation has, in effect, superseded the authority of

any previous legislation’s capped entitlement amounts. In theory,

the entitlement ceiling represents the total amount from which

States are entitled to receive their authorized allotments. However,

as table 10–1 shows, appropriation levels have not always met the

entitlement ceiling, and in a few cases, have surpassed it. Table

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TABLE 10–1.—TITLE XX SOCIAL SERVICES BLOCK GRANT FUNDING LEVELS, 1982–2001

[In millions of dollars]

Fiscal year Appropriation Entitlement

ceiling

1982 .................................................................................... $2,400 $2,400

1983 .................................................................................... 1 2,675 2,450

1984 .................................................................................... 2,700 2,700

1985 .................................................................................... 2 2,725 2,700

1986 .................................................................................... 3 2,584 2,700

1987 .................................................................................... 2,700 2,700

1988 .................................................................................... 2,700 4 2,750

1989 .................................................................................... 2,700 2,700

1990 .................................................................................... 5 2,762 6 2,800

1991 .................................................................................... 2,800 2,800

1992 .................................................................................... 2,800 2,800

1993 .................................................................................... 2,800 2,800

1994 .................................................................................... 7 2,800 2,800

1995 .................................................................................... 2,800 2,800

1996 .................................................................................... 2,381 8 2,381

1997 .................................................................................... 9 2,500 8 2,380

1998 .................................................................................... 10 2,299 8 2,380

1999 .................................................................................... 11 1,909 8 2,380

2000 .................................................................................... 12 1,775 8 2,380

2001 .................................................................................... NA 13 1,700

1 Amount includes an additional $225 million appropriated in the emergency jobs bill (Public Law 98–

8).2 Amount includes $25 million earmarked for training of day care providers, licensing officials, and

parents including training in the prevention of child abuse in child care settings (Public Law 98–473). 3 The entitlement ceiling for fiscal year 1986 was $2.7 billion. However, the Gramm-Rudman-Hollings

legislation sequestration of funds for that period reduced the funding by $116 million to $2.584 billion. 4 The 1987 Budget Reconciliation Act (Public Law 100–203) included a $50 million increase in the

title XX entitlement ceiling for fiscal year 1988; however, these additional funds were not appropriated. 5 The fiscal year 1990 appropriation included a supplemental appropriation of $100 million (Public Law

101–198). The Gramm-Rudman-Hollings legislation sequestration of funds for fiscal year 1990 reduced

the funding by $37.8 million to $2.762 billion. 6 OBRA 1989 (Public Law 101–239) included a permanent $100 million increase in the title XX entitlement ceiling to $2.8 billion, beginning in fiscal year 1990. 7 The $2.8 billion appropriated amount shown does not include the $1 billion that OBRA 1993 made

available on an entitlement basis under title XX for empowerment zones and enterprise communities. 8 At the time of the fiscal year 1996 appropriation, the entitlement ceiling for title XX was still permanently set at $2.8 billion. However, the 1996 welfare reform law (Public Law 104–193) amended title

XX of the Social Security Act to set the entitlement ceiling at $2.381 billion for fiscal year 1996, and

$2.380 billion for fiscal years 1997–2002. Under this legislation, the ceiling was scheduled to return to

$2.8 billion for fiscal year 2003 and succeeding years. 9 Public Law 104–208 contained a $2.5 billion appropriation for title XX, exceeding the ceiling established in the 1996 welfare reform law. 10 The fiscal year 1998 appropriations measure (Public Law 105–78) included $2.299 billion for title

XX despite the $2.38 billion ceiling established in the 1996 welfare reform law. 11 The Omnibus Consolidated Appropriations Act for fiscal year 1999 (Public Law 105–277) included an

appropriation level of $1.909 billion for title XX, once again, below the $2.38 billion ceiling established

in Public Law 104–193. 12 The fiscal year 2000 Consolidated Appropriations Act (Public Law 106–113) set title XX funding at

$1.775 billion, of which $425 million may not be obligated to States until September 29, 2000. 13 Under the Transportation Equity Act (TEA, Public Law 105–178), the title XX entitlement ceiling is

scheduled to be permanently reduced to $1.7 billion beginning in fiscal year 2001.

NA—Not applicable.

Source: Table prepared by the Congressional Research Service.

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10–2 shows the total funds available to each State and territory

under title XX in selected fiscal years from 1989 through 2000.

PROGRAM GOALS

The purpose of the Title XX Social Services Block Grant Program

is to provide assistance to States to enable them to furnish services

directed at one or more of five broad goals:

—Achieving or maintaining economic self-support to prevent, reduce, or eliminate dependency;

—Achieving or maintaining self-sufficiency, including reduction

or prevention of dependency;

—Preventing or remedying neglect, abuse, or exploitation of children and adults unable to protect their own interests, or preserving, rehabilitating or reuniting families;

—Preventing or reducing inappropriate institutional care by providing for community-based care, home-based care, or other

forms of less intensive care; and

—Securing referral or admission for institutional care when

other forms of care are not appropriate, or providing services

to individuals in institutions.

States are given wide discretion to determine the services to be

provided and the groups that may be eligible for services, usually

low income families and individuals. In addition to supporting social services, the law allows States to use their allotment for staff

training, administration, planning, evaluation, and purchasing

technical assistance in developing, implementing, or administering

the State social service program. States decide what amount of the

Federal allotment to spend on services, training, and administration.

Some restrictions are placed on the use of title XX funds. Funds

cannot be used for the following: most medical care except family

planning; rehabilitation and certain detoxification services; purchase of land, construction, or major capital improvements; most

room and board except emergency short-term services; educational

services generally provided by public schools; most social services

provided in and by employees of hospitals, nursing homes, and

prisons; cash payments for subsistence; child day care services that

do not meet State and local standards; and wages to individuals as

a social service except wages of welfare recipients employed in

child day care.

DATA ON SERVICES, RECIPIENTS, AND EXPENDITURES

In the past, limited information has been available on the use of

title XX funds by the States. Under the Title XX Social Services

Block Grant Program, each State must submit a report to the Secretary of the U.S. Department of Health and Human Services

(DHHS) on the intended use of its funds. These preexpenditure reports are only required to include information about the types of

activities to be funded and the characteristics of the individuals to

be served.

TABLE 10–2.—TITLE XX SOCIAL SERVICES BLOCK GRANT ALLOCATIONS BY STATE AND TERRITORY, SELECTED FISCAL YEARS 1989–200

[In millions of dollars]

State 1989 1993 1995 1996 1997 1998 1999 

Alabama ............................................. $45.1 $46.2 $45.1 $38.4 $40.3 $37.0 $30.6 Alaska ................................................. 5.9 6.2 6.4 5.5 5.8 5.3 4.3 American Samoa ................................ 0.2 0.1 0.1 0.1 0.1 0.1 0.1 Arizona ................................................ 36.5 41.0 41.8 36.1 38.9 36.7 31.7 Arkansas ............................................. 26.4 28.3 26.2 22.3 23.4 21.6 18.0 California ............................................ 300.5 333.2 336.9 286.5 300.1 274.8 228.1 Colorado ............................................. 36.4 38.9 37.9 32.7 34.9 32.6 27.4 Connecticut ........................................ 35.5 38.8 35.8 30.1 31.3 28.5 23.4 Delaware ............................................. 7.1 7.5 7.5 6.4 6.7 6.2 5.2 District of Columbia ........................... 7.0 6.8 6.4 5.3 5.4 4.8 3.9 Florida ................................................ 130.0 144.8 147.2 125.6 133.2 123.3 103.0 Georgia ............................................... 68.0 72.5 73.7 63.5 67.4 62.7 52.6 Guam .................................................. 0.5 0.5 0.5 0.4 0.4 0.4 0.3 Hawaii ................................................ 11.8 12.4 12.7 10.8 11.3 10.3 8.5 Idaho .................................................. 11.2 11.3 11.6 10.1 10.8 10.1 8.5 Illinois ................................................. 128.7 128.0 127.0 107.4 112.2 102.9 84.8 Indiana ............................................... 61.3 62.1 61.8 52.4 54.9 50.5 41.8 Iowa .................................................... 31.8 31.1 30.7 25.8 27.0 24.7 20.4 Kansas ................................................ 27.4 27.7 27.5 23.2 24.4 22.3 18.4 Kentucky ............................................. 41.5 41.3 41.0 34.8 36.5 33.6 27.8 Louisiana ............................................ 50.1 47.2 46.8 39.4 41.2 37.8 31.1 Maine .................................................. 13.1 13.7 13.5 11.4 11.8 10.8 8.9 

Maryland ............................................. 49.7 53.5 53.6 45.6 47.8 43.9 36.3 Massachusetts ................................... 65.0 67.4 65.5 55.2 57.7 52.8 43.6 Michigan ............................................. 101.9 104.1 103.0 87.0 90.7 83.1 68.7 Minnesota ........................................... 46.9 49.0 48.9 41.5 43.6 40.1 33.3 Mississippi ......................................... 29.2 28.8 28.5 24.3 25.5 23.5 19.4 Missouri .............................................. 56.4 57.3 56.7 48.0 50.4 46.3 38.3 Montana ............................................. 9.1 8.9 9.0 7.7 8.2 7.6 6.3 Nebraska ............................................ 17.8 17.7 17.5 14.8 15.5 14.2 11.8 Nevada ............................................... 10.7 13.5 14.5 12.8 13.9 13.3 11.5 New Hampshire .................................. 11.4 12.4 12.1 10.3 10.9 10.0 8.3 New Jersey .......................................... 84.9 86.5 85.0 72.3 75.5 69.1 57.2 New Mexico ......................................... 16.5 17.0 17.3 14.8 15.8 14.7 12.3 New York ............................................ 198.0 201.4 197.8 167.1 173.5 157.8 130.1 North Carolina .................................... 70.5 74.2 74.7 63.8 67.5 62.6 52.4 North Dakota ...................................... 7.6 7.2 6.9 5.8 6.1 5.6 4.6 Northern Mariana Islands .................. 0.1 0.1 0.1 0.1 0.1 0.1 0.1 Ohio .................................................... 119.8 121.4 120.2 101.8 106.0 97.0 80.0 Oklahoma ........................................... 36.8 35.2 35.1 29.7 31.1 28.5 23.6 Oregon ................................................ 30.1 31.8 32.5 27.8 29.5 27.3 22.9 Pennsylvania ...................................... 132.4 133.0 131.1 110.5 115.1 105.0 86.3 Puerto Rico ......................................... 14.0 14.5 14.5 12.3 12.9 11.9 9.9 Rhode Island ...................................... 10.9 11.2 11.0 9.2 9.5 8.6 7.1 South Carolina ................................... 37.6 39.0 39.3 33.4 35.0 32.0 26.5 South Dakota ...................................... 7.9 7.8 7.8 6.6 6.9 6.3 5.2 Tennessee ........................................... 53.5 54.6 54.8 46.8 49.4 45.7 38.1 Texas .................................................. 185.8 190.2 192.7 165.5 175.5 162.9 136.9 Utah .................................................... 18.5 19.3 19.8 17.1 18.2 17.0 14.3 

TABLE 10–2.—TITLE XX SOCIAL SERVICES BLOCK GRANT ALLOCATIONS BY STATE AND TERRITORY, SELECTED FISCAL YEARS 1989–2000—Co

[In millions of dollars]

State 1989 1993 1995 1996 1997 1998 1999 

Vermont .............................................. 6.0 6.3 6.2 5.3 5.5 5.1 4.2 Virginia ............................................... 64.5 69.3 69.6 59.6 62.6 57.6 47.8 Virgin Islands ..................................... 0.5 0.5 0.5 0.4 0.4 0.4 0.3 Washington ......................................... 49.7 54.5 56.1 48.2 51.0 47.3 39.6 West Virginia ...................................... 21.4 20.1 19.8 16.7 17.4 15.9 13.1 Wisconsin ........................................... 53.3 54.8 54.7 46.2 48.5 44.6 36.9 Wyoming ............................................. 5.6 5.1 5.1 4.3 4.5 4.2 3.4 

Total .......................................... 2,700.0 2,800.0 2,800.0 2,381.0 2,500.0 2,299.0 1,909.0 

Source: Administration for Children and Families, U.S. Department of Health and Human Services.

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The Family Support Act of 1988 (Public Law 100–485) strengthened reporting requirements. That legislation required States to

submit annual reports containing detailed information on the services actually funded and the individuals served through title XX

funds. DHHS published a final rule on November 15, 1993 implementing the reporting requirements and providing uniform definitions of services. Although all States are now submitting these reports, DHHS has released very little summary information. In July

1999, DHHS released an analysis of expenditure and recipient data

for fiscal years 1995–97; however, the analysis included only 40

States.

Table 10–3 is a comparison of the primary services offered by

States as reported on expenditure reports submitted by States for

fiscal years 1988–97. It should be noted when comparing the totals

in any particular service category across years that for fiscal years

1988–95, the table includes data from the five eligible territories,

whereas this is not true for fiscal years 1996 and 1997. Also, as indicated in the table footnotes, categorization of services has varied

over the years, making a strict comparison over years difficult.

Nevertheless, table 10–3 presents a reasonably accurate picture of

the range of services that have been offered by States under title

XX. Based on these reports, at least 35 States in 1997 used title

XX funds for each of the following services: (1) daycare for children;

(2) foster care services for children; (3) home-based services; (4)

prevention/intervention; and (5) protective services for children.

TABLE 10–3.—COMPARISON OF THE NUMBER OF STATES 1 OFFERING SELECTED

SERVICES, SELECTED FISCAL YEARS 1988–97

Services 1988 1990 1992 1993 1994 1995 1996 1997

Adoption ............................. 29 35 34 36 38 35 28 27

Case management ............ 26 26 33 38 34 33 27 26

Counseling ......................... 22 21 24 23 30 22 22 22

Day care—adults .............. 23 26 28 27 28 29 28 27

Day care—children ........... 51 45 47 49 45 51 47 47

Education/training ............. 19 17 17 19 19 18 13 17

Emergency 2 ....................... 15 16 17 21 19 14 ....... .......

Employment ....................... 21 23 22 23 16 19 16 15

Family planning ................. 26 26 26 23 19 20 16 17

Foster care—adults .......... 12 10 11 16 14 15 14 15

Foster care—children ....... 29 30 31 37 41 41 36 36

Health-related .................... 22 23 30 34 27 21 14 16

Home-based 3 .................... 45 46 46 45 46 45 39 39

Home delivered/congregate

meals ............................ 20 20 22 20 18 22 21 25

Housing .............................. 10 16 14 14 14 12 10 10

Independent/transitional

living ............................. 17 16 17 16 15 21 12 12

Information and referral .... 23 25 27 26 26 27 13 15

Legal .................................. 17 13 16 19 14 12 11 12

Pregnancy and parenting 4 ....... ....... ....... ....... ....... ....... 14 15

Prevention/intervention ...... 33 27 31 36 36 42 33 36

Protective—adults ............ 34 30 32 36 35 35 30 30

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TABLE 10–3.—COMPARISON OF THE NUMBER OF STATES 1 OFFERING SELECTED

SERVICES, SELECTED FISCAL YEARS 1988–97—Continued

Services 1988 1990 1992 1993 1994 1995 1996 1997

Protective—children .......... 38 42 46 50 49 44 40 39

Recreation 5 ....................... ....... ....... ....... ....... ....... ....... 8 9

Residential care/treatment 21 25 29 27 31 26 20 20

Services for unmarried

parents 6 ........................ 13 13 14 20 15 17 ....... .......

Social support 7 ................. 27 45 37 35 37 27 ....... .......

Special services—children 8 ............................. 27 19 18 22 15 16 ....... .......

Special services—disabled 39 34 38 38 34 33 25 22

Special services—youth at

risk ................................ 16 14 18 17 16 19 18 18

Substance abuse ............... 10 11 15 12 13 12 9 11

Transportation ................... 30 25 27 30 27 29 22 21

Other 7 ................................ 20 19 19 13 18 32 29 31

1 For fiscal years 1988–95, the 50 States, the District of Columbia, and the 5 eligible territories are

included. For fiscal years 1996 and 1997, the 50 States and the District of Columbia are represented. 2 ‘‘Emergency’’ is not listed as a separate service category on the standard expenditure reporting form

for fiscal years 1996 and 1997. 3 Home-based services include: homemaker, chore, home health, companionship, and home maintenance. 4 Pregnancy and parenting services for young parents is a category included on the standard reporting

form for fiscal years 1996 and 1997. This is not to imply that these services were not available prior to

1996. These services apply to both married and unmarried adolescent parents. The category ‘‘Services for

unmarried parents’’ is not included on the fiscal year 1996 and 1997 reporting forms. 5 The category ‘‘recreation’’ is included on the standard reporting form for fiscal years 1996 and 1997.

For earlier years, recreation is included in ‘‘social support.’’ 6 ‘‘Services for unmarried parents’’ is not listed as a separate category on the form for fiscal years

1996 and 1997. See footnote 4. 7 ‘‘Social Support’’ is not listed as a separate category on the form for fiscal years 1996 and 1997.

For earlier years, this category included: socialization, recreation (see footnote 5), camping, physical activity, living skills (money management), day treatment, family development, social adjustment, community

living services, family management, life skills education, personal and financial management. 8 The category ‘‘special services—children’’ is not listed as a separate category on the form for fiscal

years 1996 and 1997.

Source: U.S. Department of Health and Human Services for fiscal years 1988–95. Congressional Research Service, based on postexpenditure data submitted by the States to DHHS, for fiscal years 1996

and 1997.

Table 10–4 shows the percentage of title XX expenditures for

each category of service in fiscal years 1995–97. The table is based

on an analysis conducted by the Congressional Research Service of

expenditure data submitted to DHHS from 50 States and the District of Columbia. Although the majority of States used a common

form for reporting these data, some discretion was used in categorizing expenditures on a national basis. While every category

may not be absolutely comparable in every State, this table, like

table 10–3, provides a reasonably accurate picture of the use of

title XX funds across the country.

The table indicates that the single largest category of spending

in fiscal year 1997 was child day care, accounting for almost 13

percent of expenditures. The percentage of total title XX expenditures dedicated to child welfare-related services, shown in several

categories (adoption services, foster care services for children, and

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protective services for children), appears to have dropped from 22.5

percent in 1995 to 16 percent in 1997. Home-based services and

special services for the disabled represent significant categories of

expenditures in 1997, accounting for almost 12 and 9 percent of

spending, respectively. States devoted about 14 percent of their expenditures to administrative costs in each of the 3 years.

TABLE 10–4.—USE OF TITLE XX FUNDS, BY EXPENDITURE CATEGORY, FISCAL YEARS

1995–97

Service

Percent of funds

1995 1996 1997

Adoption ..................................................... 1.1 1.1 0.9

Case management ..................................... 3.9 3.8 5.8

Congregate meals ...................................... 0.0 0.0 0.1

Counseling ................................................. 1.3 1.4 1.7

Day care—adults ...................................... 0.8 1.5 0.9

Day care—children .................................... 14.7 14.8 12.9

Education/training ..................................... 0.9 0.5 0.7

Employment ................................................ 1.1 1.2 1.2

Family planning ......................................... 1.1 1.3 1.2

Foster care—adults ................................... 0.7 0.3 0.4

Foster care—children ................................ 10.4 14.1 8.1

Health-related ............................................ 0.6 0.5 0.9

Home-based ............................................... 10.2 10.4 11.5

Home delivered meals ............................... 0.5 0.6 0.8

Housing ...................................................... 0.2 0.2 0.2

Independent/transitional living .................. 0.4 0.3 0.2

Information and referral ............................ 0.8 0.9 1.1

Legal .......................................................... 0.4 0.4 0.4

Pregnancy and parenting .......................... 0.4 0.4 0.4

Prevention/intervention .............................. 6.8 5.2 5.4

Protective—adults ..................................... 2.1 3.0 3.7

Protective—children .................................. 11.0 6.7 7.0

Recreation .................................................. 0.1 0.1 0.1

Residential treatment ................................ 3.9 2.7 3.0

Special services—disabled ....................... 3.8 7.2 9.2

Special services—youth at risk ................ 2.0 2.2 1.6

Substance abuse ....................................... 0.3 0.3 0.3

Transportation ............................................ 0.6 0.6 0.5

Other .......................................................... 5.6 4.8 6.0

Administrative costs .................................. 14.0 13.5 14.0

Total .................................................. 100.0 100.0 100.0

Source: Table prepared by the Congressional Research Service based on data submitted by 50 States

and the District of Columbia to the U.S. Department of Health and Human Services.

TRANSFER OF FUNDS AMONG BLOCK GRANTS

Welfare reform legislation enacted in 1996 (Public Law 104–193)

replaced the Aid to Families with Dependent Children (AFDC) Program with a block grant to States called Temporary Assistance for

Needy Families (TANF; see section 7). The welfare reform law auVerDate 20-JUL-2000 13:14 Sep 29, 2000 Jkt 061710 PO 00000 Frm 00641 Fmt 6601 Sfmt 6601 J:\SKAYNE\GB96\61710.010 WAYS3 PsN: WAYS3
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thorized States to transfer up to 30 percent of their TANF allotments to title XX or to the Child Care and Development Block

Grant (CCDBG). However, as originally enacted, Public Law 104–

193 required that, for every dollar transferred to title XX, States

must transfer $2 to the CCDBG. This provision was revised by the

Balanced Budget Act of 1997 (Public Law 105–33) so that States

are allowed to transfer up to 10 percent of their TANF allotment

to title XX, regardless of how much, if any, they transfer to the

CCDBG. The welfare reform law stipulates that any TANF funds

transferred to title XX must be used for families with incomes no

higher than 200 percent of the Federal poverty guidelines, and may

be used to provide vouchers for families who are not eligible for

cash assistance under TANF because of time limits, or for children

who are denied cash assistance under TANF because they were

born into families already receiving benefits for another child.

Beginning in fiscal year 2001, under provisions of the Transportation Equity Act, signed into law June 9, 1998 (Public Law 105–

178), the percentage amount of their annual TANF allotment that

States can transfer into title XX is scheduled to be reduced from

10 percent to 4.25 percent. This legislation also permanently reduces the entitlement ceiling to $1.7 billion beginning in fiscal year

2001.

Public Law 97–35, which created the title XX block grant, gave

States the authority to transfer up to 10 percent of their annual

allotment to one or any combination of the three health care block

grants and the Low-Income Home Energy Assistance Program

(LIHEAP). (The three health care block grants are: the Preventive

Health and Health Services Block Grant; the Maternal and Child

Health Services Block Grant; and the Alcohol, Drug Abuse, and

Mental Health Services Block Grant.) In turn, most other block

grant statutes allow States to transfer funds to the title XX program. However, the Augustus F. Hawkins Human Services Reauthorization Act of 1990 eliminated the authority to transfer

LIHEAP funds to other block grants, beginning for fiscal year 1994.

SOCIAL SERVICES IN EMPOWERMENT ZONES AND

ENTERPRISE COMMUNITIES

The Omnibus Budget Reconciliation Act of 1993 (Public Law 103–66) made $1 billion available on an entitlement basis under

title XX for the Secretary of DHHS to make grants to States for

social services in qualified empowerment zones and enterprise communities (the legislation also provided certain tax incentives for

zones and communities). On December 21, 1994, President Clinton

selected 105 designees to participate in this program (6 urban and

3 rural empowerment zones, 60 urban and 30 rural enterprise communities, 2 supplemental empowerment zones and 4 enhanced enterprise communities). These funds remain available for expenditure for 10 years. The Taxpayer Relief Act of 1997 (Public Law

105–34) authorized a second round of enterprise zone and community designations, but no title XX funding was included for the second round.

An empowerment zone or enterprise community is qualified for

purposes of the title XX grant if it has been designated a zone or

community under part I, subchapter U, chapter I of the Internal

643

Revenue Code of 1986 and if its strategic plan (required in an application for designation under the Internal Revenue Code) is qualified.

A qualified plan is a plan that: (1) includes a detailed description

of the activities proposed for the area that are to be funded with

the grant; (2) contains a commitment that the funds provided will

not be used to supplant Federal or non-Federal funds for services

and activities which promote the purposes of the grant; (3) to the

extent a State does not use the funds on certain program options,

explains the reasons why not; and (4) explains how the plan was

developed in cooperation with the local government or governments

with jurisdiction over the zone or community.

With respect to each empowerment zone, the Secretary was re- quired to make one grant ($50 million if urban, $20 million if rural)

to each State in which the zone lies on the date of its designation,

and a second grant of the same amount on the first day of the following fiscal year. With respect to each enterprise community, the

Secretary made one grant of up to $3 million to each State in

which the community lies on the date of its designation. States

have up to 10 years from the date of their designation in which to

expend these additional title XX funds, although they must be obligated within the first 2 years.

States, in conjunction with the local governments with jurisdiction over the zone or community, have broad discretion in the use

of grant funds. Funds must be used for social services directed at

three goals of the basic title XX grant program: achieving or maintaining economic self-support to prevent, reduce or eliminate dependency; achieving or maintaining self-sufficiency, including reduction or prevention of dependency; or preventing or remedying

neglect, abuse, or exploitation of children and adults unable to protect their own interests, or preserving, rehabilitating or reuniting

families. The funds also must be used in accordance with the strategic plan and on activities that benefit residents of the zone or

community.

Despite the similar purposes for which funds may be used, the

range of allowable services is narrower in some respects, and

broader in others, under the title XX empowerment zone provisions

relative to the basic title XX program. For example, the basic title

XX program includes a broader range of purposes than those outlined above for the empowerment zone program. On the other

hand, certain restrictions of the basic title XX program (e.g., restrictions that limit drug treatment services to initial detoxification, and restrictions on the use of funds for the payment of wages)

are waived under the empowerment zone program, in order to

carry out certain specified program options.

LEGISLATIVE HISTORY

(For legislative history before 1996, see previous editions of the

Green Book.)

Although $2.8 billion was the permanently authorized entitlement ceiling at the time, Congress appropriated only $2.381 billion

for title XX in fiscal year 1996 (Public Law 104–134). The Personal

Responsibility and Work Opportunity Reconciliation Act (Public

Law 104–193) subsequently set the annual entitlement ceiling for

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title XX at $2.38 billion in each of fiscal years 1997–2002. Under

this legislation, the entitlement ceiling was scheduled to return to

the permanent level of $2.8 billion in fiscal year 2003. (Enactment

of Public Law 105–178 in 1998 would subsequently lower this ceiling—see below.) Despite the newly established ceiling of $2.38 billion, Congress appropriated $2.5 billion for title XX in fiscal year

1997 (Public Law 104–208).

In June 1998, the Transportation Equity Act (TEA, Public Law

105–178) was enacted, including a provision which schedules the

title XX ceiling to be reduced to $1.7 billion beginning in fiscal year

2001. This will result in reductions of $680 million in each of fiscal

years 2001 and 2002 (from the previously scheduled ceiling of $2.38

billion), and annual reductions of $1.1 billion beginning in fiscal

year 2003 (from the previously scheduled entitlement ceiling of

$2.8 billion). In addition to reducing the ceiling, the TEA reduces

the percentage of a State’s annual TANF allotment that it may

transfer to title XX, beginning in fiscal year 2001, from 10 percent

to 4.25 percent.

The fiscal year 1998 appropriations measure (Public Law 105– 178) decreased title XX funding to $2.299 billion, once again below

the $2.38 billion ceiling established under the welfare reform law

of 1996. In explaining the reduction, the Senate Appropriations

Committee noted that funding is provided for social services

through other Federal programs. The House Appropriations Committee expressed concern that DHHS lacked information on the effectiveness of SSBG-funded activities. Funding for title XX continued to decline with a $1.909 billion appropriation under the Omnibus Consolidated Appropriations Act for fiscal year 1999 (Public

Law 105–277). For fiscal year 2000, the Consolidated Appropriations Act (Public Law 106–113) set title XX funding at $1.775 billion, of which $425 million may not be obligated to States until

September 29, 2000.