support programs have any significant asset hold-
ings. For people with disabilities, 38 percent live on 
less than $15,000 annually, and that 58 percent are 
asset poor. 
(9) A consistent segment of the American popu-
lation remains outside the financial mainstream 
where they rely on costly check cashing and lending 
institutions: 11 percent of households do not have a 
checking account and 9 percent do not have a trans-
action account of any kind. 54 percent of people 
with disabilities have no savings accounts, and 69 
percent have no checking accounts. Low-income fam-
ilies who rely on public assistance are less likely to 
use a formal financial institution, in part out of fear 
that any account balance will be penalized by a re-
duction in benefits. 
(10) According to the Center for Social Devel-
opment, the presence of savings and even small asset 
holdings by a household is associated with a range 
of positive outcomes, including increased economic 
stability, educational attainment and performance, 
and health and psychological well-being. 
(11) Increasing the number of households that 
save and the amounts that they save will allow more 
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Americans to achieve greater control, security, inde-
pendence, and choice in their lives. 
SEC. 2. MODIFICATION OF ASSET TEST UNDER FOOD 
STAMP PROGRAM. 
(a) FINANCIAL RESOURCES.—Section 5(g) of the 
Food Stamp Act of 1977 (7 U.S.C. 2014(g)) is amend-
ed— 
(1) by striking ‘‘(g)(1) The Secretary’’ and in-
serting the following: 
‘‘(g) ALLOWABLE FINANCIAL RESOURCES.— 
‘‘(1) TOTAL AMOUNT.— 
‘‘(A) IN GENERAL.—The Secretary’’; 
(2) in subparagraph (A) (as designated by 
paragraph (1)— 
(A) by striking ‘‘$2,000’’ and inserting 
‘‘$6,000 (as adjusted in accordance with sub-
paragraph (B))’’; and 
(B) by striking ‘‘$3,000’’ and inserting 
‘‘$8,000 (as adjusted in accordance with sub-
paragraph (B))’’ ; and 
(3) by adding at the end the following: 
‘‘(B) ADJUSTMENT FOR INFLATION.— 
‘‘(i) IN GENERAL.—Beginning on Oc-
tober 1, 2007, and each October 1 there-
after, the amounts in subparagraph (A) 
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shall be adjusted to the nearest $100 in-
crement to reflect changes for the 12- 
month period ending the preceding June in 
the Consumer Price Index for All Urban 
Consumers published by the Bureau of 
Labor Statistics of the Department of 
Labor. 
‘‘(ii) REQUIREMENT.—Each adjust-
ment under clause (I) shall be based on 
the unrounded amount for the prior 12- 
month period.’’. 
(b) DEFINITION REQUIRED.—Section 5(g)(6)(B)(iii) 
of 
the 
Food 
Stamp 
Act 
of 
1977 
(7 
U.S.C. 
2014(g)(6)(B)(iii)) is amended by inserting ‘‘(as defined 
by the Secretary)’’ after ‘‘available’’. 
(c) EXCLUSION OF RETIREMENT ACCOUNTS FROM 
COUNTABLE FINANCIAL RESOURCES.— 
(1) IN GENERAL.—Section 5(g)(2)(B)(v) of the 
Food 
Stamp 
Act 
of 
1977 
(7 
U.S.C. 
2014(g)(2)(B)(v)) is amended by striking ‘‘or retire-
ment account (including an individual account)’’ and 
inserting ‘‘account’’. 
(2) MANDATORY AND DISCRETIONARY EXCLU-
SIONS.—Section 5(g) of the Food Stamp Act of 
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1977 (7 U.S.C. 2014(g)) is amended by adding at 
the end the following: 
‘‘(7) EXCLUSION
OF
RETIREMENT
ACCOUNTS 
FROM COUNTABLE FINANCIAL RESOURCES.— 
‘‘(A) MANDATORY EXCLUSIONS.—The Sec-
retary shall exclude from financial resources 
under this subsection the value of any funds in 
a plan, contract, or account, described in sec-
tions 401(a), 403(a), 403(b), 408, 408A, 
457(b), and 501(c)(18) of the Internal Revenue 
Code of 1986 and the value of funds in a Fed-
eral Thrift Savings Plan account as provided in 
section 8439 of title 5, United States Code. 
‘‘(B) DISCRETIONARY
EXCLUSIONS.—The 
Secretary may exclude from financial resources 
under this subsection the value of any other re-
tirement plans, contracts, or accounts (as deter-
mined by the Secretary through regulation).’’. 
(d) EXCLUSION OF EDUCATION ACCOUNTS FROM 
COUNTABLE FINANCIAL RESOURCES.—Section 5(g) of 
the Food Stamp Act of 1977 (7 U.S.C. 2014(g)) (as 
amended by section 3) is amended by adding at the end 
the following: 
‘‘(8) EXCLUSION
OF
EDUCATION
ACCOUNTS 
FROM COUNTABLE FINANCIAL RESOURCES.— 
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‘‘(A) MANDATORY EXCLUSIONS.—The Sec-
retary shall exclude from financial resources 
under this subsection the value of any funds in 
a qualified tuition program described in section 
529 of the Internal Revenue Code of 1986 or 
in a Coverdell education savings account under 
section 530 of that Code. 
‘‘(B) DISCRETIONARY
EXCLUSIONS.—The 
Secretary may exclude from financial resources 
under this subsection the value of any other 
education programs, contracts, or accounts (as 
determined by the Secretary through regula-
tion).’’. 
(e) EXCLUSION OF VEHICLES FROM COUNTABLE FI-
NANCIAL
RESOURCES.—Section 5(g)(2)(B)(iv) of the 
Food Stamp Act of 1977 (7 U.S.C. 2014(g)(2)(B)(iv)) is 
amended to read as follows: 
‘‘(iv) subject to subparagraphs (B) 
and (C), any licensed vehicle that is not 
used for household transportation or to ob-
tain or continue employment.’’. 
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SEC. 3. PROHIBITION ON USE OF ASSET TEST UNDER THE 
TEMPORARY ASSISTANCE FOR NEEDY FAMI-
LIES (TANF) PROGRAM. 
(a) PROHIBITION.—Section 408(a) of the Social Se-
curity Act (42 U.S.C. 608(a)) is amended by adding at 
the end the following: 
‘‘(12) PROHIBITION ON IMPOSITION OF ASSET 
TEST.—A State to which a grant is made under sec-
tion 403 shall not consider the level or types of as-
sets or resources of an individual or family in deter-
mining the eligibility of the individual or family for, 
or the amount or types of assistance to provide to 
the individual or family under the State program 
funded under this part.’’. 
(b) PENALTY.—Section 409(a) of such Act (42 
U.S.C. 609(a)) is amended by adding at the end the fol-
lowing: 
‘‘(16) PENALTY
FOR
IMPOSITION
OF
ASSET 
TEST.— 
‘‘(A) IN GENERAL.—If the Secretary deter-
mines that a State to which a grant is made 
under section 403 in a fiscal year has violated 
section 408(a)(12) during the fiscal year, the 
Secretary shall reduce the grant payable to the 
State under section 403(a)(1) for the imme-
diately succeeding fiscal year by an amount 
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equal to not less than 1 percent and not more 
than 5 percent of the State family assistance 
grant. 
‘‘(B) PENALTY
BASED
ON
SEVERITY
OF 
FAILURE.—The Secretary shall impose reduc-
tions under subparagraph (A) with respect to a 
fiscal year based on the degree of noncompli-
ance.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on July 1, 2008. 
SEC. 4. ELIMINATION OF ASSET TEST FOR DISABLED PER-
SONS UNDER THE SUPPLEMENTAL SECURITY 
INCOME (SSI) PROGRAM. 
(a) IN GENERAL.—Section 1611(a) of the Social Se-
curity Act (42 U.S.C. 1382(a)) is amended in each of 
paragraphs (1)(B) and (2)(B) by inserting ‘‘in the case 
of an individual who is aged or blind,’’ before ‘‘whose’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 1602 of such Act (42 U.S.C. 
1381a) is amended by inserting ‘‘(in the case of an 
individual who is aged or blind)’’ before ‘‘resources’’. 
(2) Section 1621(a) of such Act (42 U.S.C. 
1382j(a)) is amended by striking ‘‘an individual’’ 
and inserting ‘‘a blind or disabled individual’’. 
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(3) Section 1631(b)(3) of such Act (42 U.S.C. 
1383(b)(3)) is amended by inserting ‘‘(as in effect 
before the effective date of section 4 of the Freedom 
to Save Act of 2007)’’ after ‘‘section 1611(a)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to benefits for months beginning 
on or after July 1, 2008. 
SEC. 5. ELIMINATION OF ASSET TEST UNDER STATE CHIL-
DREN’S 
HEALTH 
INSURANCE 
PROGRAM 
(SCHIP). 
Section 2102(b) of the Social Security Act (42 U.S.C. 
1397bb(b)) is amended— 
(1) in paragraph (1)(A), by striking ‘‘income 
and resources (including any standards relating to 
spenddowns and disposition of resources)’’ and in-
serting ‘‘and income’’; and 
(2) in paragraph (1)(B)— 
(A) by striking ‘‘and’’ at the end of clause 
(i); 
(B) by striking the period at the end of 
clause (ii) and inserting ‘‘, and’’; and 
(C) by adding at the end the following new 
clause: 
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‘‘(iii) may not deny eligibility, or vary 
the amount of benefits under this title, 
based on assets or resources.’’. 
SEC. 6. EFFECTIVE DATE. 
Except as otherwise provided in this Act, the amend-
ments made by this Act shall apply to assistance furnished 
on or after July 1, 2008. 
Æ 
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