I
103D CONGRESS
1ST SESSION
H. R. 1007
To amend title IV of the Social Security Act to eliminate disincentives
in the program of aid to families with dependent children that prevent
recipients of such aid from working toward self-sufficiency.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 18, 1993
Mr. SHAYS (for himself and Mr. MFUME) introduced the following bill; which
was referred jointly to the Committees on Ways and Means, and Energy
and Commerce
A BILL
To amend title IV of the Social Security Act to eliminate
disincentives in the program of aid to families with de-
pendent children that prevent recipients of such aid from
working toward self-sufficiency.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION. 1. WORK INCENTIVES.
(a) MEDICAID
BENEFITS
CONTINUED
FOR
MONTHS
FOR FAMILIES BECOMING INELIGIBLE
FOR
AFDC DUE TO EXCESSIVE INCOME.—Section 402(a) of
the Social Security Act (42 U.S.C. 602(a)) is amended—
(1) by striking ‘‘and’’ at the end of paragraph
(44);
(2) by striking the period at the end of para-
graph (45) and inserting ‘‘; and’’; and
(3) by inserting after paragraph (45) the fol-
lowing:
‘‘(46) if a family becomes ineligible for aid
under the State plan under this part due to exces-
sive income, the family shall remain eligible for med-
ical assistance under the State plan under title XIX
for the 36-month period beginning with most recent
month in which the family becomes so ineligible.’’.
(b) 
INCREASE
IN
RESOURCE
LIMIT.—Section
402(a)(7)(B) of such Act (42 U.S.C. 602(a)(7)(B)) is
amended by striking ‘‘$1,000 or such lower amount as the
State may determine’’ and inserting ‘‘$10,000’’.
(c) ENCOURAGEMENT OF MICROENTERPRISES.—
(1) 
STATE
PLAN
REQUIREMENT.—Section
402(a) of the Social Security Act (42 U.S.C.
602(a)), as amended by subsection (a) of this sec-
tion, is amended—
(A) by striking ‘‘and’’ at the end of para-
graph (45);
(B) by striking the period at the end of
paragraph (46) and inserting ‘‘; and’’; and
(C) by inserting after paragraph (46) the
following:
‘‘(47) must ensure that caseworkers are able to
properly advise recipients of aid under the State
plan of the option of microenterprise as a legitimate
route towards self-sufficiency, and that caseworkers
encourage recipients of such aid who are interested
in starting a microenterprise to participate in a pro-
gram designed to assist them in such effort.’’.
(2) DEFINITIONS.—Section 406 of such Act (42
U.S.C. 606) is amended by adding at the end the
following:
‘‘(i)(1) The term ‘microenterprise’ means a commer-
cial enterprise which has 5 or fewer employees, 1 or more
of whom owns the enterprise.
‘‘(2) The term ‘net profits’ means, with respect to
a microenterprise, the gross receipts of the business,
minus—
‘‘(A) amounts paid as principal or interest on
a loan to the microenterprise;
‘‘(B) transportation expenses;
‘‘(C) inventory costs;
‘‘(D) amounts expended to purchase capital
equipment;
‘‘(E) cash retained by the microenterprise for
future use by the business;
‘‘(F) taxes paid by reason of the business;
‘‘(G) if the business is covered under a policy
of insurance against loss—
‘‘(i) the premiums paid for such insurance;
and
‘‘(ii) the losses incurred by the business
that are not reimbursed by the insurer solely by
reason of the existence of a deductible with re-
spect to the insurance policy;
‘‘(H) the reasonable costs of obtaining 1 motor
vehicle necessary for the conduct of the business;
and
‘‘(I) the other expenses of the business.’’.
(3) INCLUSION OF MICROENTERPRISE TRAINING
AND ACTIVITIES IN THE JOBS PROGRAM.—
(A) IN
GENERAL.—Section 482(d)(1) of
such Act (42 U.S.C. 682(d)(1)) is amended
adding at the end the following:
‘‘(C) The services and activities referred to in sub-
paragraph (A)—
‘‘(i) in the case that at least 3 percent of the
adult recipients of aid under the State plan approved
under part A (as of the close of the immediately pre-
ceding 
fiscal 
year) 
elect 
to 
participate 
in
microenterprise activities, shall include programs de-
scribed in paragraph (4); or
‘‘(ii) in the case that not more than 3 percent
of the adult recipients of such aid elect to partici-
pate in microenterprise activities, may include pro-
grams described in paragraph (4).’’.
(B) MICROENTERPRISE
PROGRAMS.—Sec-
tion 482(d) of such Act (42 U.S.C. 682(d)) is
amended by adding at the end the following:
‘‘(4) The programs described in this paragraph are
programs of public and private organizations, agencies,
and other entities (including nonprofit and for-profit enti-
ties) to enable such entities to facilitate economic develop-
ment by—
‘‘(A) providing technical assistance, advice, and
business support services (including assistance, ad-
vice, and support relating to business planning, fi-
nancing, marketing, and other microenterprise devel-
opment activities) to owners of microenterprises and
persons developing microenterprises; and
‘‘(B) providing general support (such as peer
support and self-esteem programs) to owners of
microenterprises 
and 
persons 
developing
microenterprises.’’.
(4) ADJUSTMENT
OF
PERFORMANCE
STAND-
ARDS FOR MICROENTERPRISES TO TAKE ACCOUNT
OF TIME REQUIRED FOR THEIR ESTABLISHMENT.—
Section 487(a)(2) of such Act (42 U.S.C. 687(a)(2))
is amended by inserting ‘‘shall be adjusted with re-
spect to microenterprises to reflect the time required
to establish, and develop a stable income from, such
an enterprise as part of a plan to move toward eco-
nomic self-sufficiency,’’ after ‘‘dependency,’’.
(5) STUDY TO IDENTIFY ADMINISTRATIVE BAR-
RIERS
TO
DEVELOPMENT
OF
MICROENTERPRISES
AMONG INTERESTED AFDC RECIPIENTS.—The Sec-
retary of Health and Human Services shall conduct
a study to identify the administrative and bureau-
cratic barriers that impede the development of
microenterprises by recipients of aid to families with
dependent children under the State plans approved
under part A of title IV of the Social Security Act
who desire to move toward self-sufficiency, and, not
later than 1 year after the date of the enactment of
this section, shall report the results of the study to
the Committee on Ways and Means of the House of
Representatives and the Committee on Finance of
the Senate.
(d) EARNED INCOME DISREGARD.—
(1) IN GENERAL.—Section 402(a)(8) of such
Act (42 U.S.C. 602(a)(8)) is amended—
(A) in subparagraph (A)(iv)—
(i) by inserting ‘‘for each of the first
36 months beginning on or after the effec-
tive date of this clause for which such aid
is so received,’’ after ‘‘determination,’’; and
(ii) by striking all that follows ‘‘plus’’
and inserting ‘‘(II) for the first 12 months
of such 36-month period, 60 percent of the
remainder thereof, for the second 12
months of such 36-month period, 50 per-
cent of the remainder thereof, and for the
third 12 months of such 36-month period,
40 percent of the remainder thereof;’’; and
(B) in subparagraph (B), by striking
clause (ii).
(2) CONFORMING AMENDMENTS.—
(A) Section 402(a)(37) of such Act (42
U.S.C. 602(a)(37)) is amended by striking
‘‘paragraph (8)(B)(ii)(II)’’ and inserting ‘‘the
inapplicability of paragraph (8)(A)(iv)’’.
(B) Section 402(g)(1)(A)(ii) of such Act
(42 U.S.C. 602(g)(1)(a)(II)) is amended by
striking ‘‘subsection (a)(8)(B)(ii)(II)’’ and in-
serting 
‘‘the 
inapplicability 
of 
subsection
(a)(8)(A)(iv)’’.
(C) Section 482(e)(2)(G)(ii) of such Act
(42 U.S.C. 682(e)(2)(G)(ii)) is amended by
striking 
‘‘the 
provisions 
of 
subparagraph
(A)(iv)’’ and all that follows and inserting ‘‘sec-
tion 402(a)(8)(A)(iv) without regard to the time
limitation of such section’’.
(D) Section 1925(a)(1) of such Act (42
U.S.C. 1396r–6(a)(1)) is amended by striking
‘‘section 402(a)(8)(B)(ii)(II)’’ and inserting
‘‘the 
inapplicability 
of 
section
402(a)(8)(A)(iv)’’.
SEC. 2. EDUCATION.
(a) AFDC SUSPENDED FOR SO LONG AS DEPEND-
ENT CHILD IS NOT REGULARLY ATTENDING REQUIRED
SCHOOL.—Section 402(a) of the Social Security Act (42
U.S.C. 602(a)) is amended by inserting after paragraph
(28) the following:
‘‘(29) provide that payments of aid that would
otherwise be payable under the plan to the family in
respect of a child required by State law to attend
school shall be suspended for so long as the child is
not enrolled in, and in regular attendance at, a
school;’’.
(b) AFDC REDUCED
FOR HIGH SCHOOL DROP-
OUTS.—Section 402(a) of such Act (42 U.S.C. 602(a)) is
amended by inserting after paragraph (34) the following:
‘‘(35) provide that the amount of aid that
would otherwise be payable under the plan to a fam-
ily in which the relative claiming such aid has not
completed high school or been awarded a certificate
of high school equivalency, shall be reduced by $50
for so long as the relative is not enrolled in, and in
regular attendance at, a school;’’.
(c) CHILD CARE GUARANTEED TO PARENTS WHILE
COMPLETING HIGH SCHOOL OR THE EQUIVALENT.—Sec-
tion 
402(g)(1)(A)(i) 
of 
such 
Act 
(42 
U.S.C.
602(g)(1)(A)(i)) is amended—
(1) by striking ‘‘and’’ at the end of subclause
(I);
(2) by striking the period at the end of
subclause (II) and inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(III) for each recipient of aid under the State
plan under this part who has not completed high
school or been awarded a certificate of high school
equivalency, and who has a dependent child requir-
ing such care, but only for such months or parts
thereof during which the recipient is enrolled in, and
in regular attendance at, a school.’’.
SEC. 3. FAMILY UNITY AND PATERNAL RESPONSIBILITY.
(a) AUTHORITY TO COLLECT OVERDUE CHILD SUP-
PORT THROUGH LEVY BY INTERNAL REVENUE SERVICE
ON WAGES.—
(1) IN GENERAL.—Subchapter D of chapter 64
of the Internal Revenue Code of 1986 (relating to
seizure of property for collection of taxes) is amend-
ed by redesignating section 6344 as section 6345
and by inserting after section 6343 the following
new section:
‘‘SEC. 6344. COLLECTION OF OVERDUE CHILD SUPPORT
THROUGH LEVY ON WAGES.
‘‘(a) IN GENERAL.—If the Secretary is notified by
a State under section 464 of the Social Security Act that
any person owes overdue support (as defined in section
466(e) of such Act) the payment of which is at least 2
months delinquent—
‘‘(1) the amount of such overdue support shall
be treated as unpaid tax for purposes of permitting
the Secretary (subject to section 6334(a)(9)) to levy
upon the wages and salary payable to or received by
such person to collect such amount, and
‘‘(2) the collection of such amount shall be
treated as in jeopardy.
‘‘(b) REMITTANCE TO STATE.—The Secretary shall
remit any amount collected under subsection (a) to the
State collecting such support.
‘‘(c) LIMITATION
ON REVIEW.—No court of the
United States shall have jurisdiction to hear any action,
whether legal or equitable, brought to restrain or review
a levy (and any collection thereunder) authorized by sub-
section (a). No such levy (or collection) shall be subject
to review by the Secretary in an administrative proceeding.
No action brought against the United States to recover
the amount of any such collection shall be considered to
be a suit for refund of tax. This subsection does not pre-
clude any legal, equitable, or administrative action against
the Department of Health and Human Services.’’
(2) CLERICAL AMENDMENT.—The table of sec-
tions for such subchapter D is amended by striking
the last item and inserting the following new items:
‘‘Sec. 6344. Collection of overdue child support through levy on
wages.
‘‘Sec. 6345. Cross references.’’
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall take effect on the date of the
enactment of this Act.
(b) AFDC AVAILABLE
FOR CERTAIN FAMILIES
THAT INCLUDE MARRIED COUPLES.—Part A of title IV
SEC. 4. EFFECTIVE DATE.
The amendments made by this Act shall take effect
at the end of the calendar month in which this Act is en-
acted, and shall apply to payments under part A of title
IV of the Social Security Act for calendar quarters ending
with or after such calendar month.
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