H. R. 2491—704
another State differently than other families under
the program, and if so, how the State intends to treat
such families under the program.
‘‘(ii) The document shall indicate whether the State
intends to provide assistance under the program to
individuals who are not citizens of the United States,
and if so, shall include an overview of such assistance.
‘‘(2) CERTIFICATION THAT THE STATE WILL OPERATE A CHILD
SUPPORT ENFORCEMENT PROGRAM.—A certification by the chief
executive officer of the State that, during the fiscal year, the
State will operate a child support enforcement program under
the State plan approved under part D.
‘‘(3) CERTIFICATION THAT THE STATE WILL OPERATE A CHILD
PROTECTION PROGRAM.—A certification by the chief executive
officer of the State that, during the fiscal year, the State will
operate a child protection program under the State plan
approved under part B.
‘‘(4) CERTIFICATION OF THE ADMINISTRATION OF THE PRO-
GRAM.—A certification by the chief executive officer of the State
specifying which State agency or agencies will administer and
supervise the program referred to in paragraph (1) for the
fiscal year, which shall include assurances that local govern-
ments and private sector organizations—
‘‘(A) have been consulted regarding the plan and design
of welfare services in the State so that services are provided
in a manner appropriate to local populations; and
‘‘(B) have had at least 60 days to submit comments
on the plan and the design of such services.
‘‘(5) CERTIFICATION THAT THE STATE WILL PROVIDE INDIANS
WITH EQUITABLE ACCESS TO ASSISTANCE.—A certification by the
chief executive officer of the State that, during the fiscal year,
the State will provide each Indian who is a member of an
Indian tribe in the State that does not have a tribal family
assistance plan approved under section 411 with equitable
access to assistance under the State program funded under
this part.
‘‘(b) SPECIAL RULE FOR FISCAL YEAR 1996.—Notwithstanding
subsection (a), the term ‘eligible State’ means, with respect to
fiscal year 1996, a State that has submitted to the Secretary a
plan described in subsection (a) within 3 months after the date
of the enactment of this part.
‘‘(c) PUBLIC AVAILABILITY OF STATE PLAN SUMMARY.—The State
shall make available to the public a summary of any plan submitted
by the State under this section.
‘‘SEC. 402. PAYMENTS TO STATES.
‘‘(a) GRANTS.—
‘‘(1) FAMILY ASSISTANCE GRANT.—
‘‘(A) IN GENERAL.—Each eligible State shall be entitled
to receive from the Secretary, for each of fiscal years 1996,
1997, 1998, 1999, and 2000, a grant in an amount equal
to the State family assistance grant. The payment of these
grants to States shall not be deemed to entitle any individ-
ual or family to any assistance under any State program
funded under this part.
H. R. 2491—705
‘‘(B) STATE
FAMILY
ASSISTANCE
GRANT
DEFINED.—As
used in this part, the term ‘State family assistance grant’
means the greatest of—
‘‘(i) 1⁄3 of the total amount required to be paid
to the State under section 403 of this title (as in
effect on September 30, 1995) for fiscal years 1992,
1993, and 1994 (other than with respect to amounts
expended by the State for child care under subsection
(g) or (i) of section 402 (as so in effect));
‘‘(ii) the total amount required to be paid to the
State under such section 403 for fiscal year 1994 (other
than with respect to amounts expended by the State
for child care under subsection (g) or (i) of section
402 (as so in effect)); or
‘‘(iii) 4⁄3 of the total amount required to be paid
to the State under such section 403 for the 1st 3
quarters of fiscal year 1995 (other than with respect
to amounts expended by the State under the State
plan approved under part F (as so in effect) or for
child care under subsection (g) or (i) of section 402
(as so in effect)), plus the total amount required to
be paid to the State for fiscal year 1995 under section
403(l) (as so in effect).
‘‘(2) GRANT TO REWARD STATES THAT REDUCE OUT-OF-WED-
LOCK BIRTHS.—
‘‘(A) IN GENERAL.—In addition to any grant under para-
graph (1), each eligible State shall be entitled to receive
from the Secretary for fiscal year 1998 or any succeeding
fiscal year, a grant in an amount equal to the State family
assistance grant multiplied by—
‘‘(i) 5 percent if—
‘‘(I) the illegitimacy ratio of the State for the
fiscal year is at least 1 percentage point lower
than the illegitimacy ratio of the State for fiscal
year 1995; and
‘‘(II) the rate of induced pregnancy termi-
nations in the State for the fiscal year is less
than the rate of induced pregnancy terminations
in the State for fiscal year 1995; or
‘‘(ii) 10 percent—
‘‘(I) if the illegitimacy ratio of the State for
the fiscal year is at least 2 percentage points lower
than the illegitimacy ratio of the State for fiscal
year 1995; and
‘‘(II) the rate of induced pregnancy termi-
nations in the State for the fiscal year is less
than the rate of induced pregnancy terminations
in the State for fiscal year 1995.
‘‘(B) ILLEGITIMACY RATIO.—As used in this paragraph,
the term ‘illegitimacy ratio’ means, with respect to a State
and a fiscal year—
‘‘(i) the number of out-of-wedlock births that
occurred in the State during the most recent fiscal
year for which such information is available; divided
by
H. R. 2491—706
‘‘(ii) the number of births that occurred in the
State during the most recent fiscal year for which
such information is available.
‘‘(C) DISREGARD OF CHANGES IN DATA DUE TO CHANGED
REPORTING METHODS.—For purposes of subparagraph (A),
the Secretary shall disregard—
‘‘(i) any difference between the illegitimacy ratio
of a State for a fiscal year and the illegitimacy ratio
of the State for fiscal year 1995 which is attributable
to a change in State methods of reporting data used
to calculate the illegitimacy ratio; and
‘‘(ii) any difference between the rate of induced
pregnancy terminations in a State for a fiscal year
and such rate for fiscal year 1995 which is attributable
to a change in State methods of reporting data used
to calculate such rate.
‘‘(3) SUPPLEMENTAL GRANT FOR POPULATION INCREASES IN
CERTAIN STATES.—
‘‘(A) IN GENERAL.—In addition to any grant under para-
graph (1), each qualifying State shall, subject to subpara-
graph (E), be entitled to receive from the Secretary for
each of fiscal years 1997, 1998, 1999, and 2000, a grant
in an amount equal to the sum of—
‘‘(i) the amount (if any) required to be paid to
the State under this paragraph for the immediately
preceding fiscal year; and
‘‘(ii) 2.5 percent of the sum of—
‘‘(I) the total amount required to be paid to
the State under part A (as in effect during fiscal
year 1994) for fiscal year 1994; and
‘‘(II) the amount (if any) required to be paid
to the State under this paragraph for the fiscal
year preceding the fiscal year specified in the mat-
ter preceding clause (i).
‘‘(B) QUALIFYING STATE.—
‘‘(i) IN GENERAL.—For purposes of this paragraph,
a State is a qualifying State for a fiscal year if—
‘‘(I) the level of welfare spending per poor per-
son by the State for the immediately preceding
fiscal year is less than the national average level
of State welfare spending per poor person for such
preceding fiscal year; and
‘‘(II) the population growth rate of the State
(as determined by the Bureau of the Census for
the most recent fiscal year for which information
is available) exceeds the average population
growth rate for all States (as so determined) for
such most recent fiscal year.
‘‘(ii) STATE MUST QUALIFY IN FISCAL YEAR 1997.—
Notwithstanding clause (i), a State shall not be a
qualifying State for any fiscal year after 1997 by reason
of clause (i) if the State is not a qualifying State
for fiscal year 1997 by reason of clause (i).
‘‘(iii) 
CERTAIN
STATES
DEEMED
QUALIFYING
STATES.—For purposes of this paragraph, a State is
deemed to be a qualifying State for fiscal years 1997,
1998, 1999, and 2000 if—
H. R. 2491—707
‘‘(I) the level of welfare spending per poor per-
son by the State for fiscal year 1996 is less than
35 percent of the national average level of State
welfare spending per poor person for fiscal year
1996; or
‘‘(II) the population of the State increased by
more than 10 percent from April 1, 1990 to July
1, 1994, as determined by the Bureau of the Cen-
sus.
‘‘(C) DEFINITIONS.—As used in this paragraph:
‘‘(i) LEVEL OF WELFARE SPENDING PER POOR PER-
SON.—The term ‘level of State welfare spending per
poor person’ means, with respect to a State and a
fiscal year—
‘‘(I) the sum of—
‘‘(aa) the total amount required to be paid
to the State under part A (as in effect during
fiscal year 1994) for fiscal year 1994; and
‘‘(bb) the amount (if any) paid to the State
under this paragraph for the immediately
preceding fiscal year; divided by
‘‘(II) the number of individuals, according to
the 1990 decennial census, who were residents
of the State and whose income was below the
poverty line.
‘‘(ii) NATIONAL AVERAGE LEVEL OF STATE WELFARE
SPENDING PER POOR PERSON.—The term ‘national aver-
age level of State welfare spending per poor person’
means, with respect to a fiscal year, an amount equal
to—
‘‘(I) the total amount required to be paid to
the States under part A (as in effect during fiscal
year 1994) for fiscal year 1994; divided by
‘‘(II) the number of individuals, according to
the 1990 decennial census, who were residents
of any State and whose income was below the
poverty line.
‘‘(iii) STATE.—The term ‘State’ means each of the
50 States of the United States and the District of
Columbia.
‘‘(D) APPROPRIATION.—Out of any money in the Treas-
ury of the United States not otherwise appropriated, there
are appropriated for fiscal years 1996, 1997, 1998, 1999,
and 2000 such sums as are necessary for grants under
this paragraph, in a total amount not to exceed
$800,000,000.
‘‘(E) GRANTS REDUCED PRO RATA IF INSUFFICIENT APPRO-
PRIATIONS.—If the amount appropriated pursuant to this
paragraph for a fiscal year is less than the total amount
of payments otherwise required to be made under this
paragraph for the fiscal year, then the amount otherwise
payable to each qualifying State for the fiscal year under
this paragraph shall be reduced by a percentage equal
to the amount so appropriated divided by such total
amount.
‘‘(b) CONTINGENCY FUND.—
H. R. 2491—708
‘‘(1) ESTABLISHMENT.—There is hereby established in the
Treasury of the United States a fund which shall be known
as the ‘Contingency Fund for State Welfare Programs’ (in this
section referred to as the ‘Fund’).
‘‘(2) DEPOSITS INTO FUND.—Out of any money in the Treas-
ury of the United States not otherwise appropriated, there
are appropriated for fiscal years 1996, 1997, 1998, 1999, and
2000 such sums as are necessary for payment to the Fund
in a total amount not to exceed $800,000,000.
‘‘(3) COMPUTATION OF GRANT.—
‘‘(A) IN GENERAL.—Subject to subparagraph (B), the
Secretary of the Treasury shall pay to each eligible State
for a fiscal year an amount equal to the Federal medical
assistance percentage for the State for the fiscal year (as
defined in section 1905(b), as in effect on the date of the
enactment of this part) of so much of the expenditures
by the State in the fiscal year under the State program
funded under this part as exceed the historic State expendi-
tures (as defined in section 408(a)(7)(B)(iii)) for the State.
‘‘(B) LIMITATION.—The total amount paid to a State
under subparagraph (A) for any fiscal year shall not exceed
an amount equal to 20 percent of the State family assist-
ance grant for the fiscal year.
‘‘(C) METHOD OF RECONCILIATION.—If, at the end of
any fiscal year, the Secretary finds that a State to which
amounts from the Fund were paid in the fiscal year did
not meet the maintenance of effort requirement under para-
graph (4)(B) for the fiscal year, the Secretary shall reduce
the grant payable to the State under subsection (a)(1) for
the immediately succeeding fiscal year by such amounts.
‘‘(4) ELIGIBLE STATE.—
‘‘(A) IN GENERAL.—For purposes of this subsection, a
State is an eligible State for a fiscal year, if—
‘‘(i)(I) the average rate of total unemployment in
such State (seasonally adjusted) for the period consist-
ing of the most recent 3 months for which data for
all States are published equals or exceeds 6.5 percent;
and
‘‘(II) the average rate of total unemployment in
such State (seasonally adjusted) for the 3-month period
equals or exceeds 110 percent of such average rate
for either (or both) of the corresponding 3-month peri-
ods ending in the 2 preceding calendar years; and
‘‘(ii) has met the maintenance of effort requirement
under subparagraph (B) for the State program funded
under this part for the fiscal year.
‘‘(B) MAINTENANCE OF EFFORT.—The maintenance of
effort requirement for any State under this subparagraph
for any fiscal year is the expenditure by the State during
the fiscal year of an amount at least equal to 100 percent
of the level of historic State expenditures for the State
(as determined under section 408(e)).
‘‘(5) STATE.—As used in this subsection, the term ‘State’
means each of the 50 States of the United States and the
District of Columbia.
‘‘(c) CONDITION OF GRANT.—
H. R. 2491—709
‘‘(1) IN GENERAL.—Notwithstanding any other provision of
this section, as a condition of receiving a grant under this
section, a State shall not provide cash assistance to a family
that includes an adult who has received assistance under any
State program funded under this part for 60 months (whether
or not consecutive) after September 30, 1995, except as provided
in paragraphs (2) and (3).
‘‘(2) MINOR CHILD EXCEPTION.—In determining the number
of months for which an individual who is a parent or pregnant,
as the case may be, has received assistance under the State
program funded under this part, there shall be disregarded
any month for which such assistance was provided with respect
to the individual and throughout which the individual was—
‘‘(A) a minor child; and
‘‘(B) not the head of a household or married to the
head of a household.
‘‘(3) HARDSHIP EXCEPTION.—
‘‘(A) IN
GENERAL.—The State may exempt a family
from the application of paragraph (1) by reason of hardship
or if the family includes an individual who has been bat-
tered or subjected to extreme cruelty.
‘‘(B) LIMITATION.—The number of families with respect
to which an exemption made by a State under subpara-
graph (A) is in effect for a fiscal year shall not exceed
15 percent of the average monthly number of families to
which the State is providing assistance under the program
funded under this part.
‘‘(C) BATTERED
OR
SUBJECT
TO
EXTREME
CRUELTY
DEFINED.—For purposes of subparagraph (A), an individual
has been battered or subjected to extreme cruelty if the
individual has been subjected to—
‘‘(i) physical acts that resulted in, or threatened
to result in, physical injury to the individual;
‘‘(ii) sexual abuse;
‘‘(iii) sexual activity involving a dependent child;
‘‘(iv) being forced as the caretaker relative of a
dependent child to engage in nonconsensual sexual
acts or activities;
‘‘(v) threats of, or attempts at, physical or sexual
abuse;
‘‘(vi) mental abuse; or
‘‘(vii) neglect or deprivation of medical care.
‘‘(4) RULE OF INTERPRETATION.—Paragraph (1) shall not
be interpreted to require any State to provide assistance to
any individual for any period of time under the State program
funded under this part.
‘‘SEC. 403. USE OF GRANTS.
‘‘(a) GENERAL RULES.—Subject to this part, a State to which
a grant is made under section 402 may use the grant—
‘‘(1) in any manner that is reasonably calculated to increase
the flexibility of States in operating a program designed to—
‘‘(A) provide assistance to needy families so that chil-
dren may be cared for in their own homes or in the homes
of relatives;
H. R. 2491—710
‘‘(B) end the dependence of needy parents on govern-
ment benefits by promoting job preparation, work, and
marriage;
‘‘(C) prevent and reduce the incidence of out-of-wedlock
pregnancies and establish annual numerical goals for
preventing and reducing the incidence of these pregnancies;
and
‘‘(D) encourage the formation and maintenance of two-
parent families; and
‘‘(2) in any manner that the State was authorized to use
amounts received under part A or F of this title, as such
parts were in effect on September 30, 1995.
‘‘(b) LIMITATION ON USE OF GRANT FOR ADMINISTRATIVE PUR-
POSES.—
‘‘(1) LIMITATION.—A State to which a grant is made under
section 402 shall not expend more than 15 percent of the
grant for administrative purposes.
‘‘(2) EXCEPTION.—Paragraph (1) shall not apply to the use
of a grant for information technology and computerization
needed for tracking or monitoring required by or under this
part.
‘‘(c) AUTHORITY TO USE PORTION OF GRANT FOR OTHER PUR-
POSES.—
‘‘(1) IN
GENERAL.—A State may use not more than 30
percent of the amount of the grant made to the State under
section 402 for a fiscal year to carry out a State program
pursuant to any or all of the following provisions of law:
‘‘(A) Part B of this title.
‘‘(B) Title XX of this Act.
‘‘(C) The Child Care and Development Block Grant
Act of 1990.
‘‘(2) APPLICABLE RULES.—Any amount paid to the State
under this part that is used to carry out a State program
pursuant to a provision of law specified in paragraph (1) shall
not be subject to the requirements of this part, but shall be
subject to the requirements that apply to Federal funds pro-
vided directly under the provision of law to carry out the
program.
‘‘(d) AUTHORITY TO RESERVE CERTAIN AMOUNTS FOR ASSIST-
ANCE.—A State may reserve amounts paid to the State under this
part for any fiscal year for the purpose of providing, without fiscal
year limitation, assistance under the State program funded under
this part.
‘‘(e) AUTHORITY TO OPERATE EMPLOYMENT PLACEMENT PRO-
GRAM.—A State to which a grant is made under section 402 may
use the grant to make payments (or provide job placement vouchers)
to State-approved public and private job placement agencies that
provide employment placement services to individuals who receive
assistance under the State program funded under this part.
‘‘(f) IMPLEMENTATION OF ELECTRONIC BENEFIT TRANSFER SYS-
TEM.—A State to which a grant is made under section 402 is
encouraged to implement an electronic benefit transfer system for
providing assistance under the State program funded under this
part, and may use the grant for such purpose.
H. R. 2491—711
‘‘SEC. 404. ADMINISTRATIVE PROVISIONS.
‘‘(a) QUARTERLY.—The Secretary shall pay each grant payable
to a State under section 402 in quarterly installments.
‘‘(b) NOTIFICATION.—Not later than 3 months before the pay-
ment of any such quarterly installment to a State, the Secretary
shall notify the State of the amount of any reduction determined
under section 411(a)(1)(B) with respect to the State.
‘‘(c) COMPUTATION
AND
CERTIFICATION
OF
PAYMENTS
TO
STATES.—
‘‘(1) COMPUTATION.—The Secretary shall estimate the
amount to be paid to each eligible State for each quarter
under this part, such estimate to be based on a report filed
by the State containing an estimate by the State of the total
sum to be expended by the State in the quarter under the
State program funded under this part and such other informa-
tion as the Secretary may find necessary.
‘‘(2) CERTIFICATION.—The Secretary of Health and Human
Services shall certify to the Secretary of the Treasury the
amount estimated by the Secretary under paragraph (1) with
respect to a State.
‘‘(d) PAYMENT METHOD.—Upon receipt of a certification under
subsection (c)(2) with respect to a State, the Secretary of the Treas-
ury shall, through the Fiscal Service of the Department of the
Treasury and before audit or settlement by the General Accounting
Office, pay to the State, at the time or times fixed by the Secretary
of Health and Human Services, the amount so certified.
‘‘SEC. 405. FEDERAL LOANS FOR STATE WELFARE PROGRAMS.
‘‘(a) LOAN AUTHORITY.—
‘‘(1) IN GENERAL.—The Secretary shall make loans to any
loan-eligible State, for a period to maturity of not more than
3 years.
‘‘(2) LOAN-ELIGIBLE STATE.—As used in paragraph (1), the
term ‘loan-eligible State’ means a State against which a penalty
has not been imposed under section 408(a)(1) at any time
before the loan is to be made.
‘‘(b) RATE OF INTEREST.—The Secretary shall charge and collect
interest on any loan made under this section at a rate equal
to the current average market yield on outstanding marketable
obligations of the United States with remaining periods to maturity
comparable to the period to maturity of the loan.
‘‘(c) USE
OF LOAN.—A State shall use a loan made to the
State under this section only for any purpose for which grant
amounts received by the State under section 402(a) may be used
including—
‘‘(1) welfare anti-fraud activities; and
‘‘(2) the provision of assistance under the State program
to Indian families that have moved from the service area of
an Indian tribe with a tribal family assistance plan approved
under section 411.
‘‘(d) LIMITATION ON TOTAL AMOUNT OF LOANS TO A STATE.—
The cumulative dollar amount of all loans made to a State under
this section during fiscal years 1996 through 2000 shall not exceed
10 percent of the State family assistance grant.
‘‘(e) LIMITATION ON TOTAL AMOUNT OF OUTSTANDING LOANS.—
The total dollar amount of loans outstanding under this section
may not exceed $1,700,000,000.
H. R. 2491—712
‘‘(f) APPROPRIATION.—Out of any money in the Treasury of
the United States not otherwise appropriated, there are appro-
priated such sums as may be necessary for the cost of loans under
this section.
‘‘SEC. 406. MANDATORY WORK REQUIREMENTS.
‘‘(a) PARTICIPATION RATE REQUIREMENTS.—
‘‘(1) ALL
FAMILIES.—A State to which a grant is made
under section 402 for a fiscal year shall achieve the minimum
participation rate specified in the following table for the fiscal
year with respect to all families receiving assistance under
the State program funded under this part:
The minimum
participation
‘‘If the fiscal year is:
rate is:
1996 ...............................................................................
1997 ...............................................................................
1998 ...............................................................................
1999 ...............................................................................
2000 ...............................................................................
2001 ...............................................................................
2002 or thereafter .........................................................
50.
‘‘(2) 2-PARENT FAMILIES.—A State to which a grant is made
under section 402 for a fiscal year shall achieve the minimum
participation rate specified in the following table for the fiscal
year with respect to 2-parent families receiving assistance
under the State program funded under this part:
The minimum
participation
‘‘If the fiscal year is:
rate is:
1996 ...............................................................................
1997 ...............................................................................
1998 ...............................................................................
1999 or thereafter .........................................................
90.
‘‘(b) CALCULATION OF PARTICIPATION RATES.—
‘‘(1) ALL FAMILIES.—
‘‘(A) AVERAGE MONTHLY RATE.—For purposes of sub-
section (a)(1), the participation rate for all families of a
State for a fiscal year is the average of the participation
rates for all families of the State for each month in the
fiscal year.
‘‘(B) MONTHLY PARTICIPATION RATES.—The participa-
tion rate of a State for all families of the State for a
month, expressed as a percentage, is—
‘‘(i) the number of families receiving assistance
under the State program funded under this part that
include an adult who is engaged in work for the month;
divided by
‘‘(ii) the amount by which—
‘‘(I) the number of families receiving such
assistance during the month that include an adult
receiving such assistance; exceeds
‘‘(II) the number of families receiving such
assistance that are subject in such month to a
reduction or termination of assistance pursuant
to section 408(a)(2) but have not been subject to
such penalty for more than 3 months within the
H. R. 2491—713
preceding 12-month period (whether or not
consecutive).
‘‘(2) 2-PARENT FAMILIES.—
‘‘(A) AVERAGE MONTHLY RATE.—For purposes of sub-
section (a)(2), the participation rate for 2-parent families
of a State for a fiscal year is the average of the participation
rates for 2-parent families of the State for each month
in the fiscal year.
‘‘(B) MONTHLY PARTICIPATION RATES.—The participa-
tion rate of a State for 2-parent families of the State
for a month shall be calculated by use of the formula
set forth in paragraph (1)(B), except that in the formula
the term ‘number of 2-parent families’ shall be substituted
for the term ‘number of families’ each place such latter
term appears.
‘‘(3) PRO RATA REDUCTION OF PARTICIPATION RATE DUE TO
CASELOAD REDUCTIONS NOT REQUIRED BY FEDERAL LAW.—
‘‘(A) IN GENERAL.—The Secretary shall prescribe regu-
lations for reducing the minimum participation rate other-
wise required by this section for a fiscal year by the number
of percentage points equal to the number of percentage
points (if any) by which—
‘‘(i) the number of families receiving assistance
during the fiscal year under the State program funded
under this part is less than
‘‘(ii) the number of families that received aid under
the State plan approved under part A of this title
(as in effect on September 30, 1995) during the fiscal
year immediately preceding such effective date.
The minimum participation rate shall not be reduced to
the extent that the Secretary determines that the reduction
in the number of families receiving such assistance is
required by Federal law.
‘‘(B) ELIGIBILITY CHANGES NOT COUNTED.—The regula-
tions described in subparagraph (A) shall not take into
account families that are diverted from a State program
funded under this part as a result of differences in eligi-
bility criteria under a State program funded under this
part and eligibility criteria under such State’s plan under
the Aid to Families with Dependent Children program,
as such plan was in effect on the day before the date
of the enactment of the Personal Responsibility and Work
Opportunity Act of 1995. Such regulations shall place the
burden on the Secretary to prove that such families were
diverted as a direct result of differences in such eligibility
criteria.
‘‘(4) STATE
OPTION
TO
INCLUDE
INDIVIDUALS
RECEIVING
ASSISTANCE
UNDER
A
TRIBAL
FAMILY
ASSISTANCE
PLAN.—For
purposes of paragraphs (1)(B) and (2)(B), a State may, at its
option, include families receiving assistance under a tribal fam-
ily assistance plan approved under section 411.
‘‘(c) ENGAGED IN WORK.—
‘‘(1) ALL FAMILIES.—For purposes of subsection (b)(1)(B)(i),
a recipient is engaged in work for a month in a fiscal year
if the recipient is participating in such activities for at least
the minimum average number of hours per week specified
in the following table during the month, not fewer than 20
H. R. 2491—714
hours per week of which are attributable to an activity
described in paragraph (1), (2), (3), (4), (5), (7), or (8) of sub-
section (d) (or, in the case of the first 4 weeks for which
the recipient is required under this section to participate in
work activities, an activity described in subsection (d)(6)):
The minimum
‘‘If the month is
average number of
in fiscal year:
hours per week is:
1996 ......................................................................
1997 ......................................................................
1998 ......................................................................
1999 ......................................................................
2000 ......................................................................
2001 ......................................................................
2002 ......................................................................
2003 or thereafter ................................................
35.
‘‘(2) 2-PARENT
FAMILIES.—For purposes of subsection
(b)(2)(B)(i), an adult is engaged in work for a month in a
fiscal year if the adult is making progress in such activities
for at least 35 hours per week during the month, not fewer
than 30 hours per week of which are attributable to an activity
described in paragraph (1), (2), (3), (4), (5), (7), or (8) of sub-
section (d) (or, in the case of the first 4 weeks for which
the recipient is required under this section to participate in
work activities, an activity described in subsection (d)(6)).
‘‘(3) LIMITATION
ON
VOCATIONAL
EDUCATION
ACTIVITIES
COUNTED
AS
WORK.—For purposes of determining monthly
participation rates under paragraphs (1)(B)(i) and (2)(B)(i) of
subsection (b), not more than 20 percent of adults in all families
and in 2-parent families determined to be engaged in work
in the State for a month may meet the work activity require-
ment through participation in vocational educational training.
‘‘(d) WORK ACTIVITIES DEFINED.—As used in this section, the
term ‘work activities’ means—
‘‘(1) unsubsidized employment;
‘‘(2) subsidized private sector employment;
‘‘(3) subsidized public sector employment;
‘‘(4) work experience (including work associated with the
refurbishing of publicly assisted housing) if sufficient private
sector employment is not available;
‘‘(5) on-the-job training;
‘‘(6) job search and job readiness assistance;
‘‘(7) community service programs;
‘‘(8) vocational educational training (not to exceed 12
months with respect to any individual);
‘‘(9) job skills training directly related to employment;
‘‘(10) education directly related to employment, in the case
of a recipient who has not attained 20 years of age, and has
not received a high school diploma or a certificate of high
school equivalency; and
‘‘(11) satisfactory attendance at secondary school, in the
case of a recipient who—
‘‘(A) has not completed secondary school; and
‘‘(B) is a dependent child, or a head of household who
has not attained 20 years of age.
‘‘SEC. 407. PROHIBITIONS.
‘‘(a) IN GENERAL.—
‘‘(1) NO
ASSISTANCE
FOR
FAMILIES
WITHOUT
A
MINOR
CHILD.—A State to which a grant is made under section 402
H. R. 2491—715
may not use any part of the grant to provide assistance to
a family, unless the family includes—
‘‘(A) a minor child who resides with a custodial parent
or other adult caretaker relative of the child; or
‘‘(B) a pregnant individual.
‘‘(2) REDUCED ASSISTANCE FOR FAMILY IF ADULT REFUSES
TO WORK.—
‘‘(A) IN GENERAL.—Except as provided in subparagraph
(B), a State to which a grant is made under section 402
may not fail to—
‘‘(i) reduce the amount of assistance otherwise pay-
able to a family receiving assistance under the State
program funded under this part, pro rata (or more,
at the option of the State) with respect to any period
during a month in which an adult member of the
family refuses to engage in work required in accordance
with this section; or
‘‘(ii) terminate such assistance,
subject to such good cause and other exceptions as the
State may establish.
‘‘(B) EXCEPTION.—Notwithstanding subparagraph (A),
a State may not reduce or terminate assistance under
the State program funded under this part based on a
refusal of an adult to work if the adult is a single custodial
parent caring for a child who has not attained 6 years
of age, and the adult proves that the adult has a dem-
onstrated inability (as determined by the State) to obtain
needed child care, for 1 or more of the following reasons:
‘‘(i) Unavailability of appropriate child care within
a reasonable distance from the individual’s home or
work site.
‘‘(ii) Unavailability or unsuitability of informal
child care by a relative or under other arrangements.
‘‘(iii) Unavailability of appropriate and affordable
formal child care arrangements.
‘‘(3) REDUCTION
OR
ELIMINATION
OF
ASSISTANCE
FOR
NONCOOPERATION IN CHILD SUPPORT.—If the agency responsible
for administering the State plan approved under part D deter-
mines that an individual is not cooperating with the State
in establishing, modifying, or enforcing a support order with
respect to a child of the individual, then the State—
‘‘(A) shall deduct from the assistance that would other-
wise be provided to the family of the individual under
the State program funded under this part the share of
such assistance attributable to the individual; and
‘‘(B) may deny the family any assistance under the
State program.
‘‘(4) NO ASSISTANCE FOR FAMILIES NOT ASSIGNING CERTAIN
SUPPORT RIGHTS TO THE STATE.—
‘‘(A) IN GENERAL.—A State to which a grant is made
under section 402 may not fail to require, as a condition
of providing assistance to a family under the State program
funded under this part, that a member of the family assign
to the State any rights the family member may have (on
behalf of the family member or of any other person for
whom the family member has applied for or is receiving
such assistance) to support from any other person, not
H. R. 2491—716
exceeding the total amount of assistance so provided to
the family, which accrue (or have accrued) before the date
the family leaves the program, which assignment, on and
after the date the family leaves the program, shall not
apply with respect to—
‘‘(i) if the assignment occurs on or after October
1, 1997, and before October 1, 2000, any support (other
than support collected pursuant to section 464) which
accrued before the family received such assistance and
which the State has not collected by September 30,
2000; or
‘‘(II) if the assignment occurs on or after October
1, 2000, any support (other than support collected
pursuant to section 464) which accrued before the fam-
ily received such assistance and which the State has
not collected by the date the family leaves the program.
‘‘(B) LIMITATION.—A State to which a grant is made
under section 402 may not require, as a condition of provid-
ing assistance to any family under the State program
funded under this part, that a member of the family assign
to the State any rights to support described in subpara-
graph (A) which accrue after the date the family leaves
the program.
‘‘(5) NO ASSISTANCE FOR TEENAGE PARENTS WHO DO NOT
ATTEND HIGH SCHOOL OR OTHER EQUIVALENT TRAINING PRO-
GRAM.—A State to which a grant is made under section 402
may not use any part of the grant to provide assistance to
an individual who has not attained 18 years of age, is not
married, has a minor child at least 12 weeks of age in his
or her care, and has not successfully completed a high school
education (or its equivalent), if the individual does not partici-
pate in—
‘‘(A) educational activities directed toward the attain-
ment of a high school diploma or its equivalent; or
‘‘(B) an alternative educational or training program
that has been approved by the State.
‘‘(6) NO ASSISTANCE FOR TEENAGE PARENTS NOT LIVING IN
ADULT-SUPERVISED SETTINGS.—
‘‘(A) IN GENERAL.—
‘‘(i) 
REQUIREMENT.—Except 
as 
provided 
in
subparagraph (B), a State to which a grant is made
under section 402 may not use any part of the grant
to provide assistance to an individual described in
clause (ii) of this subparagraph if the individual and
the minor child referred to in clause (ii)(II) do not
reside in a place of residence maintained by a parent,
legal guardian, or other adult relative of the individual
as such parent’s, guardian’s, or adult relative’s own
home.
‘‘(ii) INDIVIDUAL
DESCRIBED.— For purposes of
clause (i), an individual described in this clause is
an individual who—
‘‘(I) has not attained 18 years of age; and
‘‘(II) is not married, and has a minor child
in his or her care.
‘‘(B) EXCEPTION.—
H. R. 2491—717
‘‘(i) PROVISION
OF, OR
ASSISTANCE
IN
LOCATING,
ADULT-SUPERVISED LIVING ARRANGEMENT.—In the case
of an individual who is described in clause (ii), the
State agency referred to in section 401(a)(4) shall pro-
vide, or assist the individual in locating, a second
chance home, maternity home, or other appropriate
adult-supervised supportive living arrangement, taking
into consideration the needs and concerns of the
individual, unless the State agency determines that
the individual’s current living arrangement is appro-
priate, and thereafter shall require that the individual
and the minor child referred to in subparagraph
(A)(ii)(II) reside in such living arrangement as a condi-
tion of the continued receipt of assistance under the
State program funded under this part (or in an alter-
native appropriate arrangement, should circumstances
change and the current arrangement cease to be appro-
priate).
‘‘(ii) INDIVIDUAL
DESCRIBED.—For purposes of
clause (i), an individual is described in this clause
if the individual is described in subparagraph (A)(ii),
and—
‘‘(I) the individual has no parent, legal guard-
ian or other appropriate adult relative described
in subclause (II) of his or her own who is living
or whose whereabouts are known;
‘‘(II) no living parent, legal guardian, or other
appropriate adult relative, who would otherwise
meet applicable State criteria to act as the individ-
ual’s legal guardian, of such individual allows the
individual to live in the home of such parent,
guardian, or relative;
‘‘(III) the State agency determines that—
‘‘(aa) the individual or the minor child
referred to in subparagraph (A)(ii)(II) is being
or has been subjected to serious physical or
emotional harm, sexual abuse, or exploitation
in the residence of the individual’s own parent
or legal guardian; or
‘‘(bb) substantial evidence exists of an act
or failure to act that presents an imminent
or serious harm if the individual and the minor
child lived in the same residence with the
individual’s own parent or legal guardian; or
‘‘(IV) the State agency otherwise determines
that it is in the best interest of the minor child
to waive the requirement of subparagraph (A) with
respect to the individual or the minor child.
‘‘(iii) SECOND-CHANCE HOME.—For purposes of this
subparagraph, the term ‘second-chance home’ means
an entity that provides individuals described in clause
(ii) with a supportive and supervised living arrange-
ment in which such individuals are required to learn
parenting skills, including child development, family
budgeting, health and nutrition, and other skills to
promote their long-term economic independence and
the well-being of their children.
H. R. 2491—718
‘‘(7) NO MEDICAL SERVICES.—
‘‘(A) IN GENERAL.—Except as provided in subparagraph
(B), a State to which a grant is made under section 402
may not use any part of the grant to provide medical
services.
‘‘(B) EXCEPTION FOR FAMILY PLANNING SERVICES.—As
used in subparagraph (A), the term ‘medical services’ does
not include family planning services.
‘‘(8) DENIAL
OF
ASSISTANCE
FOR
YEARS
TO
A
PERSON
FOUND
TO
HAVE
FRAUDULENTLY
MISREPRESENTED
RESIDENCE
IN
ORDER
TO
OBTAIN
ASSISTANCE
IN
OR
MORE
STATES.—A
State to which a grant is made under section 402 may not
use any part of the grant to provide cash assistance to an
individual during the 10-year period that begins on the date
the individual is convicted in Federal or State court of having
made a fraudulent statement or representation with respect
to the place of residence of the individual in order to receive
assistance simultaneously from 2 or more States under pro-
grams that are funded under this title, title XIX, or the Food
Stamp Act of 1977, or benefits in 2 or more States under
the supplemental security income program under title XVI.
‘‘(9) DENIAL
OF
ASSISTANCE
FOR
FUGITIVE
FELONS
AND
PROBATION AND PAROLE VIOLATORS.—
‘‘(A) IN GENERAL.—A State to which a grant is made
under section 402 may not use any part of the grant
to provide assistance to any individual who is—
‘‘(i) fleeing to avoid prosecution, or custody or
confinement after conviction, under the laws of the
place from which the individual flees, for a crime,
or an attempt to commit a crime, which is a felony
under the laws of the place from which the individual
flees, or which, in the case of the State of New Jersey,
is a high misdemeanor under the laws of such State;
or
‘‘(ii) violating a condition of probation or parole
imposed under Federal or State law.
‘‘(B) EXCHANGE OF INFORMATION WITH LAW ENFORCE-
MENT
AGENCIES.—If a State to which a grant is made
under section 402 establishes safeguards against the use
or disclosure of information about applicants or recipients
of assistance under the State program funded under this
part, the safeguards shall not prevent the State agency
administering the program from furnishing a Federal,
State, or local law enforcement officer, upon the request
of the officer, with the current address of any recipient
if the officer furnishes the agency with the name of the
recipient and notifies the agency that—
‘‘(i) such recipient—
‘‘(I) is fleeing to avoid prosecution, or custody
or confinement after conviction, under the laws
of the place from which the recipient flees, for
a crime, or an attempt to commit a crime, which
is a felony under the laws of the place from which
the recipient flees, or which, in the case of the
State of New Jersey, is a high misdemeanor under
the laws of such State;
H. R. 2491—719
‘‘(II) is violating a condition of probation or
parole imposed under Federal or State law; or
‘‘(III) has information that is necessary for
the officer to conduct the official duties of the
officer; and
‘‘(ii) the location or apprehension of the recipient
is within such official duties.
‘‘(10) DENIAL
OF
ASSISTANCE
FOR
MINOR
CHILDREN
WHO
ARE
ABSENT
FROM
THE
HOME
FOR
A
SIGNIFICANT
PERIOD.—
‘‘(A) IN GENERAL.—A State to which a grant is made
under section 402 may not use any part of the grant
to provide assistance for a minor child who has been,
or is expected by a parent (or other caretaker relative)
of the child to be, absent from the home for a period
of 45 consecutive days or, at the option of the State, such
period of not less than 30 and not more than 90 consecutive
days as the State may provide for in the State plan submit-
ted pursuant to section 401.
‘‘(B) STATE
AUTHORITY
TO
ESTABLISH
GOOD
CAUSE
EXCEPTIONS.—The State may establish such good cause
exceptions to subparagraph (A) as the State considers
appropriate if such exceptions are provided for in the State
plan submitted pursuant to section 401.
‘‘(C) DENIAL OF ASSISTANCE FOR RELATIVE WHO FAILS
TO NOTIFY STATE AGENCY OF ABSENCE OF CHILD.—A State
to which a grant is made under section 402 may not use
any part of the grant to provide assistance for an individual
who is a parent (or other caretaker relative) of a minor
child and who fails to notify the agency administering
the State program funded under this part, of the absence
of the minor child from the home for the period specified
in or provided for under subparagraph (A), by the end
of the 5-day period that begins with the date that it
becomes clear to the parent (or relative) that the minor
child will be absent for such period so specified or provided
for.
‘‘(11) INCOME SECURITY PAYMENTS NOT TO BE DISREGARDED
IN DETERMINING THE AMOUNT OF ASSISTANCE TO BE PROVIDED
TO
A
FAMILY.—If a State to which a grant is made under
section 402 uses any part of the grant to provide assistance
for any individual who is receiving a payment under a State
plan for old-age assistance approved under section 2, a State
program funded under part B that provides cash payments
for foster care, or the supplemental security income program
under title XVI, then the State may not disregard the payment
in determining the amount of assistance to be provided to
the family of which the individual is a member under the
State program funded under this part.
‘‘SEC. 408. PENALTIES.
‘‘(a) IN GENERAL.—Subject to subsections (b), (c), and (d):
‘‘(1) FOR USE OF GRANT IN VIOLATION OF THIS PART.—
‘‘(A) GENERAL PENALTY.—If an audit conducted under
chapter 75 of title 31, United States Code, finds that an
amount paid to a State under section 402 for a fiscal
year has been used in violation of this part, the Secretary
shall reduce the grant payable to the State under section
H. R. 2491—720
402(a)(1) for the immediately succeeding fiscal year quarter
by the amount so used.
‘‘(B) ENHANCED
PENALTY
FOR
INTENTIONAL
VIOLA-
TIONS.—If the State does not prove to the satisfaction of
the Secretary that the State did not intend to use the
amount in violation of this part, the Secretary shall further
reduce the grant payable to the State under section
402(a)(1) for the immediately succeeding fiscal year quarter
by an amount equal to 5 percent of the State family assist-
ance grant.
‘‘(2) FOR FAILURE TO SUBMIT REQUIRED REPORT.—
‘‘(A) IN
GENERAL.—If the Secretary determines that
a State has not, within 6 months after the end of a fiscal
year, submitted the report required by section 410 for
the fiscal year, the Secretary shall reduce the grant payable
to the State under section 402(a)(1) for the immediately
succeeding fiscal year by an amount equal to 4 percent
of the State family assistance grant.
‘‘(B) RESCISSION
OF
PENALTY.—The Secretary shall
rescind a penalty imposed on a State under subparagraph
(A) with respect to a report for a fiscal year if the State
submits the report before the end of the immediately
succeeding fiscal year.
‘‘(3) FOR
FAILURE
TO
SATISFY
MINIMUM
PARTICIPATION
RATES.—
‘‘(A) IN
GENERAL.—If the Secretary determines that
a State to which a grant is made under section 402 for
a fiscal year has failed to comply with section 406(a) for
the fiscal year, the Secretary shall reduce the grant payable
to the State under section 402(a)(1) for the immediately
succeeding fiscal year by an amount equal to not more
than 5 percent of the State family assistance grant.
‘‘(B) PENALTY BASED ON SEVERITY OF FAILURE.—The
Secretary shall impose reductions under subparagraph (A)
based on the degree of noncompliance.
‘‘(4) FOR FAILURE TO PARTICIPATE IN THE INCOME AND ELIGI-
BILITY VERIFICATION SYSTEM.—If the Secretary determines that
a State program funded under this part is not participating
during a fiscal year in the income and eligibility verification
system required by section 1137, the Secretary shall reduce
the grant payable to the State under section 402(a)(1) for the
immediately succeeding fiscal year by an amount equal to not
more than 2 percent of the State family assistance grant.
‘‘(5) FOR FAILURE TO COMPLY WITH PATERNITY ESTABLISH-
MENT AND CHILD SUPPORT ENFORCEMENT REQUIREMENTS UNDER
PART D.—Notwithstanding any other provision of this Act, if
the Secretary determines that the State agency that admin-
isters a program funded under this part does not enforce the
penalties requested by the agency administering part D against
recipients of assistance under the State program who fail to
cooperate in establishing paternity in accordance with such
part, the Secretary shall reduce the grant payable to the State
under section 402(a)(1) for the immediately succeeding fiscal
year (without regard to this section) by not more than 5 percent.
‘‘(6) FOR FAILURE TO TIMELY REPAY A FEDERAL LOAN FUND
FOR STATE WELFARE PROGRAMS.—If the Secretary determines
that a State has failed to repay any amount borrowed from
H. R. 2491—721
the Federal Loan Fund for State Welfare Programs established
under section 405 within the period of maturity applicable
to the loan, plus any interest owed on the loan, the Secretary
shall reduce the grant payable to the State under section
402(a)(1) for the immediately succeeding fiscal year quarter
(without regard to this section) by the outstanding loan amount,
plus the interest owed on the outstanding amount. The Sec-
retary may not forgive any outstanding loan amount or interest
owed on the outstanding amount.
‘‘(7) MAINTENANCE OF EFFORT.—
‘‘(A) IN GENERAL.—The Secretary shall reduce the grant
payable to the State under section 402(a)(1) for fiscal year
1996, 1997, 1998, 1999, or 2000 by the amount (if any)
by which State expenditures under the State program
funded under this part for the then immediately preceding
fiscal year is less than the applicable percentage of historic
State expenditures.
‘‘(B) DEFINITIONS.—As used in this paragraph:
‘‘(i) STATE EXPENDITURES UNDER THE STATE PRO-
GRAM FUNDED UNDER THIS PART.—
‘‘(I) IN
GENERAL.—The term ‘State expendi-
tures under the State program funded under this
part’ means, with respect to a State and a fiscal
year, the sum of the expenditures by the State
under the program for the fiscal year for—
‘‘(aa) cash assistance;
‘‘(bb) child care assistance;
‘‘(cc) education, job training, and work;
‘‘(dd) administrative costs; and
‘‘(ee) any other use of funds allowable
under section 403(a)(1).
‘‘(II) EXCLUSION OF TRANSFERS FROM OTHER
STATE AND LOCAL PROGRAMS.—Such term does not
include funding supplanted by transfers from other
State and local programs.
‘‘(ii) 
APPLICABLE
PERCENTAGE.—The 
term
‘applicable percentage’ means—
‘‘(I) for fiscal year 1996, 75 percent; and
‘‘(II) for fiscal years 1997, 1998, 1999, and
2000, 75 percent reduced (if appropriate) in accord-
ance with subparagraph (C)(iii).
‘‘(iii) HISTORIC
STATE
EXPENDITURES.—The term
‘historic State expenditures’ means, with respect to
a State, the lesser of—
‘‘(I) the expenditures by the State under parts
A and F of this title (as in effect during fiscal
year 1994) for fiscal year 1994; or
‘‘(II) the amount which bears the same ratio
to the amount described in subclause (I) as—
‘‘(aa) the State family assistance grant for
the immediately preceding fiscal year; bears
to
‘‘(bb) the total amount of Federal pay-
ments to the State under section 403 (as in
effect during fiscal year 1994) for fiscal year
1994.
H. R. 2491—722
‘‘(iv) EXPENDITURES
BY
THE
STATE.—The term
‘expenditures by the State’ does not include any
expenditures from amounts made available by the Fed-
eral Government, State funds expended for the medic-
aid program under title XIX or the MediGrant program
under title XXI, or any State funds which are used
to match Federal funds or are expended as a condition
of receiving Federal funds under Federal programs
other than under title I.
‘‘(C) APPLICABLE
PERCENTAGE
REDUCED
FOR
STATES
WITH BEST OR MOST IMPROVED PERFORMANCE IN CERTAIN
AREAS.—
‘‘(i) SCORING OF STATE PERFORMANCE.—Beginning
with fiscal year 1997, the Secretary shall assign to
each State a score that represents the performance
of the State for the fiscal year in each category
described in clause (ii).
‘‘(ii) CATEGORIES.—The categories described in this
clause are the following:
‘‘(I) Increasing the number of families that
received assistance under a State program funded
under this part in the fiscal year, and that, during
the fiscal year, become ineligible for such assist-
ance as a result of unsubsidized employment.
‘‘(II) Reducing the percentage of families that,
within 18 months after becoming ineligible for
assistance under the State program funded under
this part, become eligible for such assistance.
‘‘(III) Increasing the amount earned by fami-
lies that receive assistance under this part.
‘‘(IV) Reducing the percentage of families in
the State that receive assistance under the State
program funded under this part.
‘‘(iii) REDUCTION
OF
MAINTENANCE
OF
EFFORT
THRESHOLD.—
‘‘(I) REDUCTION FOR STATES WITH 5 GREATEST
SCORES IN EACH CATEGORY OF PERFORMANCE.—The
applicable percentage for a State for a fiscal year
shall be reduced by 2 percentage points, with
respect to each category described in clause (ii)
for which the score assigned to the State under
clause (i) for the fiscal year is 1 of the 5 highest
scores so assigned to States.
‘‘(II) REDUCTION FOR STATES WITH 5 GREATEST
IMPROVEMENT
IN
SCORES
IN
EACH
CATEGORY
OF
PERFORMANCE.—The applicable percentage for a
State for a fiscal year shall be reduced by 2
percentage points for a State for a fiscal year,
with respect to each category described in clause
(ii) for which the difference between the score
assigned to the State under clause (i) for the fiscal
year and the score so assigned to the State for
the immediately preceding fiscal year is 1 of the
5 greatest such differences.
‘‘(III) 
LIMITATION
ON
REDUCTION.—The
applicable percentage for a State for a fiscal year
H. R. 2491—723
may not be reduced by more than 8 percentage
points pursuant to this clause.
‘‘(8) PENALTIES FOR SUBSTANTIAL NONCOMPLIANCE OF STATE
CHILD SUPPORT ENFORCEMENT PROGRAM WITH REQUIREMENTS
OF PART D.—
‘‘(A) IN GENERAL.—If a State program operated under
part D is found as a result of a review conducted under
section 452(a)(4) not to have complied substantially with
the requirements of such part for any quarter, and the
Secretary determines that the program is not complying
substantially with such requirements at the time the find-
ing is made, the Secretary shall, subject to paragraph (2),
reduce the grant payable to the State under section
402(a)(1) for the quarter and each subsequent quarter that
ends before the 1st quarter throughout which the program
is found not to be in substantial compliance with such
requirements by—
‘‘(i) not less than 1 nor more than 2 percent;
‘‘(ii) not less than 2 nor more than 3 percent,
if the finding is the 2nd consecutive such finding made
as a result of such a review; or
‘‘(iii) not less than 3 nor more than 5 percent,
if the finding is the 3rd or a subsequent consecutive
such finding made as a result of such a review.
‘‘(B) DISREGARD
OF
NONCOMPLIANCE
WHICH
IS
OF
A
TECHNICAL NATURE.—For purposes of subparagraph (A) and
section 452(a)(4), a State which is not in full compliance
with the requirements of this part shall be determined
to be in substantial compliance with such requirements
only if the Secretary determines that any noncompliance
with such requirements is of a technical nature which
does not adversely affect the performance of the State’s
program operated under part D.
‘‘(9) FOR FAILURE TO EXPEND ADDITIONAL STATE FUNDS TO
REPLACE GRANT REDUCTIONS.—If the grant payable to a State
under section 402(a)(1) for a fiscal year is reduced by reason
of any of the preceding paragraphs of this subsection, the
State shall, during the immediately succeeding fiscal year,
expend under the State program funded under this part an
amount equal to the sum of—
‘‘(A) the applicable percentage of the historic State
expenditures; and
‘‘(B) 105 percent of the total amount of such reductions
under such preceding paragraphs.
‘‘(b) REASONABLE CAUSE EXCEPTION.—The Secretary may not
impose a penalty on a State under subsection (a) with respect
to a requirement if the Secretary determines that the State has
reasonable cause for failing to comply with the requirement.
‘‘(c) CORRECTIVE COMPLIANCE PLAN.—
‘‘(1) IN GENERAL.—
‘‘(A) NOTIFICATION
OF
VIOLATION.—Notwithstanding
any other provision of law, the Federal Government shall,
before assessing a penalty against a State under subsection
(a), notify the State of the violation of law for which the
penalty would be assessed and allow the State the oppor-
tunity to enter into a corrective compliance plan in accord-
ance with this subsection which outlines how the State
H. R. 2491—724
will correct any such violations and how the State will
insure continuing compliance with the requirements of this
part.
‘‘(B) 60-DAY PERIOD TO PROPOSE A CORRECTIVE COMPLI-
ANCE PLAN.—Any State notified under subparagraph (A)
shall have 60 days in which to submit to the Federal
Government a corrective compliance plan to correct any
violations described in subparagraph (A).
‘‘(C) ACCEPTANCE OF PLAN.—The Federal Government
shall have 60 days to accept or reject the State’s corrective
compliance plan and may consult with the State during
this period to modify the plan. If the Federal Government
does not accept or reject the corrective compliance plan
during the period, the corrective compliance plan shall
be deemed to be accepted.
‘‘(2) FAILURE TO CORRECT.—If a corrective compliance plan
is accepted by the Federal Government, no penalty shall be
imposed with respect to a violation described in paragraph
(1) if the State corrects the violation pursuant to the plan.
If a State has not corrected the violation in a timely manner
under the plan, some or all of the penalty shall be assessed.
‘‘(d) LIMITATION ON AMOUNT OF PENALTY.—
‘‘(1) IN GENERAL.—In imposing the penalties described in
subsection (a), the Secretary shall not reduce any quarterly
payment to a State by more than 25 percent.
‘‘(2) CARRYFORWARD OF UNRECOVERED PENALTIES.—To the
extent that paragraph (1) prevents the Secretary from recover-
ing during a fiscal year the full amount of all penalties imposed
on a State under subsection (a) for a prior fiscal year, the
Secretary shall apply any remaining amount of such penalties
to the grant payable to the State under section 402(a)(1) for
the immediately succeeding fiscal year.
‘‘SEC. 409. APPEAL OF ADVERSE DECISION.
‘‘(a) IN GENERAL.—Within 5 days after the date any adverse
decision is made or action is taken under this part with respect
to a State, the Secretary shall notify the chief executive officer
of the State of the adverse decision or action, including any decision
with respect to the State plan submitted under section 401 or
the imposition of a penalty under section 408.
‘‘(b) ADMINISTRATIVE REVIEW OF ADVERSE DECISION.—
‘‘(1) IN GENERAL.—Within 60 days after the date a State
receives notice under this section of an adverse decision, the
State may appeal the decision, in whole or in part, to the
Departmental Appeals Board established in the Department
of Health and Human Services (in this section referred to
as the ‘Board’) by filing an appeal with the Board.
‘‘(2) PROCEDURAL
RULES.—The Board shall consider a
State’s appeal on the basis of such documentation as the State
may submit and as the Board may require to support the
final decision of the Board. In deciding whether to uphold
an adverse decision or any portion of such a decision, the
Board shall conduct a thorough review of the issues and take
into account all relevant evidence. The Board shall make a
final determination with respect to an appeal filed under this
paragraph not less than 60 days after the date the appeal
is filed.
H. R. 2491—725
‘‘(c) JUDICIAL REVIEW OF ADVERSE DECISION.—
‘‘(1) IN GENERAL.—Within 90 days after the date of a final
decision by the Board with respect to an adverse decision
regarding a State under this section, the State may obtain
judicial review of the final decision (and the findings incor-
porated into the final decision) by filing an action in—
‘‘(A) the district court of the United States for the
judicial district in which the principal or headquarters
office of the State agency is located; or
‘‘(B) the United States District Court for the District
of Columbia.
‘‘(2) PROCEDURAL RULES.—The district court in which an
action is filed shall review the final decision of the Board
on the record established in the administrative proceeding,
in accordance with the standards of review prescribed by sub-
paragraphs (A) through (E) of section 706(2) of title 5, United
States Code. The review shall be on the basis of the documents
and supporting data submitted to the Board.
‘‘SEC. 410. DATA COLLECTION AND REPORTING.
‘‘(a) GENERAL REPORTING REQUIREMENT.—Beginning July 1,
1996, each State shall collect on a monthly basis, and report to
the Secretary on a quarterly basis, the following information on
the families receiving assistance under the State program funded
under this part:
‘‘(1) The county of residence of the family.
‘‘(2) Whether a child receiving such assistance or an adult
in the family is disabled.
‘‘(3) The ages of the members of such families.
‘‘(4) The number of individuals in the family, and the
relation of each family member to the youngest child in the
family.
‘‘(5) The employment status and earnings of the employed
adult in the family.
‘‘(6) The marital status of the adults in the family, including
whether such adults have never married, are widowed, or are
divorced.
‘‘(7) The educational status of each adult in the family.
‘‘(8) The educational status of each child in the family.
‘‘(9) Whether the family received subsidized housing, assist-
ance under the State MediGrant plan approved under title
XXI, food stamps, or subsidized child care, and if the latter
2, the amount received.
‘‘(10) The number of months that the family has received
each type of assistance under the program.
‘‘(11) If the adults participated in, and the number of hours
per week of participation in, the following activities:
‘‘(A) Education.
‘‘(B) Subsidized private sector employment.
‘‘(C) Unsubsidized employment.
‘‘(D) Public sector employment, work experience, or
community service.
‘‘(E) Job search.
‘‘(F) Job skills training or on-the-job training.
‘‘(G) Vocational education.
‘‘(12) Information necessary to calculate participation rates
under section 406.
H. R. 2491—726
‘‘(13) The type and amount of assistance received under
the program, including the amount of and reason for any reduc-
tion of assistance (including sanctions).
‘‘(14) From a sample of closed cases, whether the family
left the program, and if so, whether the family left due to—
‘‘(A) employment;
‘‘(B) marriage;
‘‘(C) the prohibition set forth in section 407(a)(8);
‘‘(D) sanction; or
‘‘(E) State policy.
‘‘(15) Any amount of unearned income received by any
member of the family.
‘‘(16) The citizenship of the members of the family.
‘‘(b) USE OF ESTIMATES.—
‘‘(1) AUTHORITY.—A State may comply with subsection (a)
by submitting an estimate which is obtained through the use
of scientifically acceptable sampling methods approved by the
Secretary.
‘‘(2) SAMPLING AND OTHER METHODS.—The Secretary shall
provide the States with such case sampling plans and data
collection procedures as the Secretary deems necessary to
produce statistically valid estimates of the performance of State
programs funded under this part. The Secretary may develop
and implement procedures for verifying the quality of data
submitted by the States.
‘‘(c) REPORT ON USE OF FEDERAL FUNDS TO COVER ADMINISTRA-
TIVE COSTS AND OVERHEAD.—The report required by subsection
(a) for a fiscal quarter shall include a statement of the percentage
of the funds paid to the State under this part for the quarter
that are used to cover administrative costs or overhead.
‘‘(d) REPORT ON STATE EXPENDITURES ON PROGRAMS FOR NEEDY
FAMILIES.—The report required by subsection (a) for a fiscal quarter
shall include a statement of the total amount expended by the
State during the quarter on programs for needy families.
‘‘(e) REPORT
ON NONCUSTODIAL PARENTS PARTICIPATING
IN
WORK ACTIVITIES.—The report required by subsection (a) for a
fiscal quarter shall include the number of noncustodial parents
in the State who participated in work activities (as defined in
section 406(d)) during the quarter.
‘‘(f) REPORT ON TRANSITIONAL SERVICES.—The report required
by subsection (a) for a fiscal quarter shall include the total amount
expended by the State during the quarter to provide transitional
services to a family that has ceased to receive assistance under
this part because of employment, along with a description of such
services.
‘‘(g) REPORT
TO CONGRESS.—Not later than 6 months after
the end of fiscal year 1997, and each fiscal year thereafter, the
Secretary shall transmit to the Congress a report describing—
‘‘(1) whether the States are meeting—
‘‘(A) the participation rates described in section 406(a);
and
‘‘(B) the objectives of—
‘‘(i) increasing employment and earnings of needy
families, and child support collections; and
‘‘(ii) decreasing out-of-wedlock pregnancies and
child poverty;
H. R. 2491—727
‘‘(2) the demographic and financial characteristics of fami-
lies applying for assistance, families receiving assistance, and
families that become ineligible to receive assistance;
‘‘(3) the characteristics of each State program funded under
this part; and
‘‘(4) the trends in employment and earnings of needy fami-
lies with minor children living at home.
‘‘SEC. 411. DIRECT FUNDING AND ADMINISTRATION BY INDIAN TRIBES.
‘‘(a) GRANTS FOR INDIAN TRIBES.—
‘‘(1) TRIBAL FAMILY ASSISTANCE GRANT.—
‘‘(A) IN GENERAL.—For each of fiscal years 1997, 1998,
1999, and 2000, the Secretary shall pay to each Indian
tribe that has an approved tribal family assistance plan
a tribal family assistance grant for the fiscal year in an
amount equal to the amount determined under subpara-
graph (B), and shall reduce the grant payable under section
402(a)(1) to any State in which lies the service area or
areas of the Indian tribe by that portion of the amount
so determined that is attributable to expenditures by the
State.
‘‘(B) AMOUNT DETERMINED.—
‘‘(i) IN GENERAL.—The amount determined under
this subparagraph is an amount equal to the total
amount of the Federal payments to a State or States
under section 403 for fiscal year 1994 (as in effect
during such fiscal year) attributable to expenditures
by the State or States under parts A and F of this
title (as so in effect) for fiscal year 1994 for Indian
families residing in the service area or areas identified
by the Indian tribe pursuant to subsection (b)(1)(C).
‘‘(ii) USE OF STATE SUBMITTED DATA.—
‘‘(I) IN
GENERAL.—The Secretary shall use
State submitted data to make each determination
under clause (i).
‘‘(II) DISAGREEMENT
WITH
DETERMINATION.—
If an Indian tribe or tribal organization disagrees
with State submitted data described under
subclause (I), the Indian tribe or tribal organiza-
tion may submit to the Secretary such additional
information as may be relevant to making the
determination under clause (i) and the Secretary
may consider such information before making such
determination.
‘‘(2) GRANTS
FOR
INDIAN
TRIBES
THAT
RECEIVED
JOBS
FUNDS.—
‘‘(A) IN
GENERAL.—The Secretary shall pay to each
eligible Indian tribe for each of fiscal years 1996, 1997,
1998, 1999, and 2000 a grant in an amount equal to the
amount received by the Indian tribe in fiscal year 1994
under section 482(i) (as in effect during fiscal year 1994).
‘‘(B) ELIGIBLE INDIAN TRIBE.—For purposes of subpara-
graph (A), the term ‘eligible Indian tribe’ means an Indian
tribe or Alaska Native organization that conducted a job
opportunities and basic skills training program in fiscal
year 1995 under section 482(i) (as in effect during such
fiscal year).