fiscal year with respect to which payment has not
been made under subsection (l).
‘‘(5)(A) Notwithstanding paragraph (4) of this sub-
section, the Secretary shall pay to a State an amount
equal to 50 percent of the expenditures of the State in-
curred in operating the program under part F during a
fiscal year and with respect to which payment has not
been made under subsection (l) if the State’s participation
rate (determined under subparagraph (B) of this para-
graph) for the immediately preceding fiscal year is less
than—
‘‘(i) 15 percent if the preceding fiscal year is
1996;
‘‘(ii) 20 percent if such year is 1997;
‘‘(iii) 30 percent if such year is 1998;
‘‘(iv) 40 percent if such year is 1999;
‘‘(v) 50 percent if such year is 2000;
‘‘(vi) 60 percent if such year is 2001;
‘‘(vii) 70 percent if such year is 2002;
‘‘(viii) 80 percent if such year is 2003; and
‘‘(ix) 90 percent if such year is 2004.
‘‘(B)(i) The State’s participation rate for a fiscal year
shall be the number, expressed as a percentage, equal to—
‘‘(I) the number of individuals who participated
in the State’s program under part F in the year; di-
vided by
‘‘(II) the number of individuals required to par-
ticipate in the program in the year (including indi-
viduals with respect to whom the State has exercised
its option to require their participation).
‘‘(ii) For purposes of this subparagraph, an individ-
ual shall not be considered to have satisfactorily partici-
pated in the program under part F solely by reason of
the individual being registered to participate in the pro-
gram.
‘‘(C) For purposes of this paragraph, an individual
shall be considered to have participated in the program
under part F if the individual has participated in accord-
ance with such requirements, consistent with regulations
of the Secretary, as the State shall establish.
‘‘(D)(i) If the Secretary determines that a State has
failed to achieve the participation rate for any fiscal year
specified in subparagraph (A) of this paragraph, then,
subject to clause (ii), the Secretary may waive, in whole
or in part, the reduction in the payment rate otherwise
required by such subparagraph (A) if the Secretary finds
that the State—
‘‘(I) is in conformity with section 402(a)(19)
and part F;
‘‘(II) has made a good faith effort to achieve
the participation rate; and
‘‘(III) has submitted a proposal which is likely
to achieve the applicable participation rates for the
current fiscal year and any succeeding fiscal year so
specified.
‘‘(ii) The Secretary may not grant a waiver to any
State under clause (i) for more than 12 months (whether
or not consecutive) in any 48-month period.’’.
(d) 
CONFORMING
AMENDMENT.—Section
403(l)(3)(D) of such Act (42 U.S.C. 603(l)(3)(D)) is
amended—
(1) by inserting ‘‘(i)’’ after (D)’’;
(2) by inserting ‘‘who is eligible for aid under
the State plan, who applied for such aid on or after
October 1, 1996, and who is not described in section
402(a)(19)(C)’’ after ‘‘an individual’’; and
(3) by adding at the end the following:
‘‘(ii) For purposes of this paragraph, an individual
who is eligible for aid under the State plan, who applied
for such aid before October 1, 1996, and is not described
in section 402(a)(19)(C) shall not be determined to have
participated in the program under part F for a week, if
such individual has participated in such program for less
than 10 hours during the week.’’.
SEC. 102. COMMUNITY WORK EXPERIENCE PROGRAM
AMENDMENTS.
Section 482(f)(1)(B) of the Social Security Act (42
U.S.C. 682(f)(1)(B)) is amended—
(1) in clause (i)—
(A) by inserting ‘‘(I)’’ after ‘‘(B)(i)’’; and
(B) by striking ‘‘(as determined by the
State)’’ and inserting ‘‘in the transition compo-
nent of the program under this part who is re-
quired to participate in the program established
under this subsection’’; and
(C) by adding at the end the following:
‘‘(II) Each participant in the work component of the
program under this part who is required to participate in
the program established under this subsection must be re-
quired to work for 35 hours per week (or 30 hours per
week, if the State requires the participant to engage in
a job search program established by the State under sub-
section (g)).’’; and
(2) in clause (ii), by inserting ‘‘who is a partici-
pant in the transition component of the program
under this part’’ after ‘‘an individual’’.