I
104TH CONGRESS
1ST SESSION
H. R. 741
To amend title IV of the Social Security Act by reforming the aid to families
with dependent children program, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 30, 1995
Mr. VOLKMER introduced the following bill; which was referred to the Com-
mittee on Ways and Means and, in addition, to the Committees on Eco-
nomic and Educational Opportunities, Agriculture, Banking and Finan-
cial Services, the Judiciary, and Commerce, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such
provisions as fall within the jurisdiction of the committee concerned
A BILL
To amend title IV of the Social Security Act by reforming
the aid to families with dependent children program,
and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Welfare to Self-Sufficiency Act of 1994’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Amendments to Social Security Act.
TITLE I—FAMILY INVESTMENT PROGRAM AND OTHER WELFARE
REFORM
Sec. 101. Family investment program.
Sec. 102. Work incentives.
Sec. 103. Optional State disregard of dependent child’s income.
Sec. 104. Family stability.
Sec. 105. Work requirements for unemployed parents.
Sec. 106. JOBS program.
Sec. 107. Increased payments to States.
Sec. 108. Assessment, monitoring, and evaluation.
Sec. 109. Timely preventive health care for children.
Sec. 110. Wage supplementation demonstration projects.
Sec. 111. Delay in certain effective dates.
TITLE II—IMPROVEMENTS IN THE COLLECTION OF CHILD
SUPPORT
Sec. 201. Transmission and assignment of certain child support orders to the
IRS.
Sec. 202. Collection of child support by Internal Revenue Service.
Sec. 203. Publication of delinquent child support obligors.
Sec. 204. Effective date.
TITLE III—WELFARE RESTRICTIONS FOR ALIENS
Sec. 301. Eligibility of certain aliens for certain Federal benefits.
Sec. 302. State AFDC agencies required to provide information on illegal aliens
to the Immigration and Naturalization Service.
SEC. 2. FINDINGS.
The Congress finds the following:
(1) The welfare system is failing recipients and
taxpayers and must be reformed.
(2) The aid to families with dependent children
program under title IV of the Social Security Act
(hereafter in this section referred to as ‘‘AFDC’’)
remains largely unchanged from its predecessor pro-
gram which was created in 1935, while society has
changed dramatically during the same period.
(3) The number of female-headed households
with children under the age of 18 increased by 146
percent from 1970 to 1990, and there are now more
children living in single-parent homes than at any
time in the Nation’s history.
(4) Expenditures for AFDC increased 13 per-
cent (in inflation adjusted dollars) over a 12-year pe-
riod, 
from 
$19,600,000,000 
in 
1980 
to
$22,200,000,000 in 1992.
(5) The number of families on AFDC has in-
creased 33 percent over a 12-year period, from
3,600,000 families in 1980 to 4,800,000 families in
1992.
(6) There were 2,000,000 more children receiv-
ing welfare in 1992 than there were in 1980 and 1
in 5 American children currently live in poverty.
(7) Many States are enacting sweeping changes
to welfare programs in an effort to curb expendi-
tures and reduce the number of dependent families.
(8) Welfare reform legislation must recognize
the individuality of each family and enact programs
that are consistent with this principle.
(9) Welfare reform legislation must also recog-
nize the importance of a holistic approach which
treats the family as a single unit and not as the sum
of its parts.
(10) Health care reform is essential to welfare
reform because many families remain on public as-
sistance simply because they cannot afford to lose
benefits under the medicaid program under title
XIX of the Social Security Act for themselves, and,
most importantly, for their children.
(11) Parents, including noncustodial parents,
have a responsibility to provide financial support for
their children and failure to provide child support in-
creases the need for AFDC payments.
(12) In 1991, the United States Commission on
Interstate Child Support reported that the collection
of child support fell far short of court awards, with
11,000,000 children being awarded $15,000,000,000
in child support payments while approximately
$5,000,000,000 in child support payments remained
unpaid.
SEC. 3. AMENDMENTS TO SOCIAL SECURITY ACT.
Except as otherwise specifically provided, wherever in
this Act an amendment is expressed in terms of an amend-
ment to or repeal of a section or other provision, the ref-
erence shall be considered to be made to that section or
other provision of the Social Security Act.
TITLE I—FAMILY INVESTMENT
PROGRAM AND OTHER WEL-
FARE REFORM
SEC. 101. FAMILY INVESTMENT PROGRAM.
(a) STATE PLAN TO INCLUDE FAMILY INVESTMENT
PROGRAM.—Section 402(a) (42 U.S.C. 602(a)) is amend-
ed by inserting after paragraph (28) the following new
paragraph:
‘‘(29) except in the case of a State receiving a
waiver from the Secretary, provide that the State
has in effect a family investment program described
in subsection (j);’’.
(b) FAMILY INVESTMENT PROGRAM.—Section 402
(42 U.S.C. 602) is amended by adding at the end the fol-
lowing new subsection:
‘‘(j) For purposes of subsection (a)(29)—
‘‘(1) The term ‘family investment program’
means a program under which the State agency—
‘‘(A) negotiates a family investment agree-
ment (as defined in section 406(i)) with each
family, and
‘‘(B) offers a family the opportunity to
enter into a limited benefit agreement (as de-
fined in section 406(j)) in lieu of such family
investment agreement.
‘‘(2)(A) Any agreement described in section
406(i) shall be entered into by each caretaker rel-
ative, any other relative with whom a dependent rel-
ative is living, and any other individual living in the
same home as such relative and the dependent child
whose needs are taken into account in making the
determination under section 402(a)(7).
‘‘(B) An individual shall not be required to
enter into the agreement if such individual is—
‘‘(i) a parent of a child who is less than 6
months of age, but if both parents are living in
the child’s home, only one parent shall be ex-
empt from entering into the agreement;
‘‘(ii) employed for 30 or more hours per
week;
‘‘(iii) ill, incapacitated, or of advanced age;
or
‘‘(iv) needed in the home because of the ill-
ness or incapacity of another member of the
household.
‘‘(3) The State agency shall ensure that—
‘‘(A) any correspondence with an individ-
ual described in paragraph (2) relating to the
family investment program (including the initial
notice of the requirement to enter into a family
investment agreement) shall be in a format
which is designed to be easily understandable to
such individual;
‘‘(B) the correspondence described in sub-
paragraph (A) shall be designed to be under-
standable to individuals who are not English
language speakers; and
‘‘(C) employees of the State agency are
readily available to assist individuals in com-
pleting any documents required for participa-
tion in the family investment program.
‘‘(4) The State agency shall establish a dispute
resolution procedure for disputes related to partici-
pation in the family investment agreement that pro-
vides the opportunity for a hearing consistent with
the hearing requirement under section 482(h).
‘‘(5)(A) A State shall be treated as meeting the
requirements of paragraph (1) for fiscal years 1995
through 2002 if it enters into family investment
agreements with at least the implementation per-
centage of the applicable population.
‘‘(B) For purposes of subparagraph (A), the
implementation percentage is equal to—
‘‘(i) 10 percent in fiscal year 1995;
‘‘(ii) 15 percent in fiscal year 1996;
‘‘(iii) 20 percent in fiscal year 1997;
‘‘(iv) 30 percent in fiscal year 1998;
‘‘(v) 40 percent in fiscal year 1999;
‘‘(vi) 60 percent in fiscal year 2000;
‘‘(vii) 70 percent in fiscal year 2001; and
‘‘(viii) 90 percent in fiscal year 2002.
‘‘(C) For purposes of subparagraph (A), the ap-
plicable population is the average total number of in-
dividuals in the State during the fiscal year who—
‘‘(i) receive aid to families with dependent
children; and
‘‘(ii) are not exempt from entering a family
investment agreement under clauses (i) through
(iv) of paragraph (2)(B).’’.
(c) FAMILY INVESTMENT AGREEMENT AND LIMITED
BENEFIT PLAN.—Section 406 (42 U.S.C. 606) is amend-
ed by adding at the end the following new subsections:
‘‘(i) The term ‘family investment agreement’ means
a social contract between the State and each family receiv-
ing aid to families with dependent children which—
‘‘(1) outlines the steps a family will take to ob-
tain self-sufficiency;
‘‘(2) specifies a negotiated time-limited period
of eligibility for receipt of aid to families with de-
pendent children that is consistent with unique fam-
ily circumstances and is based on a reasonable plan
to facilitate the transition of the family to self-suffi-
ciency;
‘‘(3)(A) contains a requirement that each rel-
ative and any other individual entering into the
agreement (except those determined to need child
care assistance but for whom the State does not
guarantee such assistance in accordance with section
402(g)), participate in one or more of the following
activities providing such relative or individual with a
significant level of commitment up to the level re-
quired for full-time employment:
‘‘(i) Full-time or part-time employment.
‘‘(ii) Job-search activities.
‘‘(iii) Participation in a job opportunities
and basic skills training program which meets
the requirements of part F.
‘‘(iv) Participation in education or training
programs.
‘‘(v) Unpaid community service (subject to
the provisions of subparagraph (B)), only as
part of a plan to improve the employability of
the individual and leading to the eventual self-
sufficiency of the family.
‘‘(vi) Placement in a community work ex-
perience program in accordance with section
482(f).
‘‘(vii) High school completion activities (or
the equivalent) for a parent under the age of
20; and
‘‘(B)(i) provides that an individual who partici-
pates in unpaid community service under subpara-
graph (A)(v) shall not be required to perform such
unpaid community service for a greater number of
hours per month than the maximum number of
hours an individual may be required to work in any
month under the community work experience pro-
gram as determined under section 482(f)(1)(B)(i);
‘‘(ii) requires any sponsor of unpaid community
service to comply with the rules described in sub-
sections (b), (c), (d), and (g) of section 484 of the
Social Security Act (42 U.S.C. 684); and
‘‘(iii) provides that an individual’s participation
in unpaid community service may not exceed 3
months;
‘‘(4) provides each relative and any other indi-
vidual entering into the agreement with the supple-
mental services required to obtain self-sufficiency
and comply with the terms of the family investment
agreement, including health care, transportation,
child care, education, and training;
‘‘(5) if the State agency and a relative or other
individual entering into the agreement agree, pro-
vides that the relative or other individual participate
in—
‘‘(A) a substance abuse treatment pro-
gram, or other social service program that the
State agency determines necessary to increase
the employability of such relative or individual;
‘‘(B) programs and support services to
strengthen parenting skills and assure family
stability; and
‘‘(C) programs that lead to improved
school readiness for preschool children and on-
grade performance for school age children;
‘‘(6) provides that the State agency shall pro-
vide the family with reasonable support and case
management in the creation, monitoring, and adap-
tation of a family investment agreement to respond
to changes in family circumstances and factors out-
side family control;
‘‘(7) provides that the State agency shall re-
negotiate the family investment agreement—
agreement provision described in subsection (i)(8) or
elects to enter a limited benefit plan under section
402(j)(1), the family shall have the option to void
the limited benefit plan by regaining compliance with
the negotiated family investment agreement or if no
agreement has been negotiated, negotiate an agree-
ment.’’.
(d) COORDINATION BETWEEN DEPARTMENTS.—
(1) IN GENERAL.—The Secretary of Health and
Human Services, the Secretary of Labor, and the
Secretary of Education shall ensure appropriate co-
ordination in the planning, development, and oper-
ation of the programs described in paragraph (2) in
order to—
(A) improve the quality and effectiveness
of services provided by the Department of
Health and Human Services, the Department of
Labor, and the Department of Education;
(B) reduce the overlap of such programs;
and
(C) reduce the administrative costs of such
programs.
(2) PROGRAMS DESCRIBED.—The programs de-
scribed in this paragraph are as follows:
(A) The family investment program under
section 402(j) of the Social Security Act (42
U.S.C. 602(j)).
(B) The JOBS program under part F of
title IV of the Social Security Act (42 U.S.C.
681 et seq.).
(C) Job training programs.
(D) Child care programs.
(E) Educational programs.
(F) Any other program administered by
the Department of Health and Human Services,
the Department of Labor, or the Department of
Education which has the effect of promoting
self-sufficiency among recipients of aid to fami-
lies with dependent children under title IV of
the Social Security Act (42 U.S.C. 601 et seq.).
(e) EFFECTIVE DATE.—Except as provided in section
111, the amendments made by this section shall take ef-
fect on the first day of the first fiscal year beginning after
the date of the enactment of this Act.
SEC. 102. WORK INCENTIVES.
(a) INCREASE IN WORK EXPENSE DISREGARD.—Sec-
tion 402(a)(8)(A)(ii) (42 U.S.C. 602(a)(8)(A)(ii)) is
amended by inserting ‘‘, or at the option of the State (on
a statewide basis or in a defined area of the State), the
greater of the first $90, or up to the first 20 percent of
the total of such earned income for such month’’ after
‘‘such month’’.
(b) INCREASE IN EARNED INCOME INCENTIVE.—
(1) IN GENERAL.—Section 402(a)(8)(A)(iv) (42
U.S.C. 602(a)(8)(A)(iv)) is amended—
(A) by striking ‘‘(II)’’; and
(B) by inserting ‘‘, or (II) at the option of
the State (on a statewide basis or in a defined
area of the State), up to one-half of the total
of such earned income not disregarded under
any other clause of this subparagraph if such
amount is greater than the amount disregarded
under subclause (I)’’ before the semicolon at
the end.
(2) 
NO
TIME
LIMITATION.—Section
402(a)(8)(B) (42 U.S.C. 602(a)(8)(B)) is amended
to read as follows:
‘‘(B) provide that (with respect to any month)
the State agency shall not disregard under clause
(ii), (iii), or (iv) of subparagraph (A) any earned in-
come of any one of the individuals specified in sub-
paragraph (A)(ii) if such individual—
‘‘(i) terminated the individual’s employ-
ment or reduced the individual’s earned income
without good cause within such period (of not
less than 30 days) preceding such month as
may be prescribed by the Secretary;
‘‘(ii) refused without good cause, within
such period preceding such month as may be
prescribed by the Secretary, to accept employ-
ment in which the individual is able to engage
which is offered through the public employment
offices of the State, or is otherwise offered by
an employer if the offer of such employer is de-
termined by the State or local agency admin-
istering the State plan, after notification by the
employer, to be a bona fide offer of employ-
ment; or
‘‘(iii) failed without good cause to make a
timely report (as prescribed by the State plan
pursuant to paragraph (14)) to the State agen-
cy of earned income received in such month;
and’’.
(c) WORK TRANSITION PERIOD.—
(1) IN
GENERAL.—Section 402(a)(8)(A) (42
U.S.C. 602(a)(8)(A)) is amended—
(A) by striking ‘‘and’’ at the end of clause
(vii); and
(B) by inserting after clause (viii) the fol-
lowing new clause:
‘‘(ix) at the option of the State (on a state-
wide basis or in a defined area of the State),
may disregard up to the first 4 months of
earned income due to new employment of any
child or relative receiving aid to families with
dependent children, or of any other individual
(living in the same home as such relative and
child) whose needs are taken into account in
making such a determination not disregarded
under any other clause of this subparagraph,
if—
‘‘(I) such individual earned less than
$1,200 in the 12-month period preceding
the new employment; and
‘‘(II) such individual timely reports
the earnings to the State agency; and’’.
(2) 
AFDC 
QUALITY
CONTROL.—Section
408(c)(3) (42 U.S.C. 608(c)(3)) is amended—
(A) by striking ‘‘or’’ at the end of subpara-
graph (D);
(B) by striking the period at the end of
subparagraph (E) and inserting ‘‘; or’’; and
(C) by adding at the end the following new
subparagraph:
‘‘(F) the State’s reliance on the best infor-
mation available in determining eligibility for
the earned income disregard described in sec-
tion 402(a)(8)(A)(ix).’’.
(d) RETROSPECTIVE BUDGETING PROCEDURES.—
Section 402(a)(13) (42 U.S.C. 602(a)(13)) is amended—
(1) by striking ‘‘subparagraph (B)’’ in subpara-
graph (A) and inserting ‘‘subparagraphs (B) and
(C)’’;
(2) by striking ‘‘and’’ at the end of subpara-
graph (A);
(3) by adding ‘‘and’’ at the end of subpara-
graph (B); and
(4) by adding at the end the following new sub-
paragraph:
‘‘(C) in the case of the termination of a
source of income of an individual whose income
is taken into account in making a determination
under paragraph (7), the State agency shall
consider the loss of income in making a deter-
mination regarding the amount of aid, begin-
ning in the first month such loss of income oc-
curs, but only if the termination is timely re-
ported and, in the case of earned income, the
individual shows good cause for the termination
of employment;’’.
(e) DISREGARD
OF
INTEREST
INCOME.—Section
402(a)(8)(A) (42 U.S.C. 602(a)(8)(A)), as amended by
subsection (c) of this section, is amended—
(1) by striking ‘‘and’’ at the end of clause (viii);
and
(2) by inserting after clause (ix) the following
new clause:
‘‘(x) at the option of the State (on a state-
wide basis or in a defined area of the State),
may disregard all interest income of any child
or relative applying for or receiving aid to fami-
lies with dependent children, or of any other in-
dividual (living in the same home as such rel-
ative and child) whose needs are taken into ac-
count in making such a determination; and’’.
(f) DISREGARD OF INCOME AND RESOURCES DES-
IGNATED
FOR EDUCATION, TRAINING, AND EMPLOY-
ABILITY.—
(1) 
DISREGARD
AS
RESOURCE.—Section
402(a)(7)(B) (42 U.S.C. 602(a)(7)(B)) is amend-
ed—
(A) by striking ‘‘or’’ before ‘‘(iv)’’; and
amounts in which, after such placement, does
not exceed $10,000;’’.
(B) TREATMENT
AS
INCOME.—Section
402(a)(7) (42 U.S.C. 602(a)(7)) is amended—
(i) by striking ‘‘and’’ at the end of
subparagraph (B);
(ii) by striking the semicolon at the
end of subparagraph (C) and inserting ‘‘;
and’’; and
(iii) by adding at the end the follow-
ing new subparagraph:
‘‘(D) shall treat as income any distribu-
tions from a qualified asset account (as defined
in section 406(k)(1)) which do not meet the
definition of a qualified distribution under sec-
tion 406(k)(2);’’.
(3) QUALIFIED ASSET ACCOUNTS.—Section 406
(42 U.S.C. 606), as amended by section 101(b) of
this Act, is amended by adding at the end the fol-
lowing new subsection:
‘‘(k)(1) The term ‘qualified asset account’ means a
mechanism approved by the State (such as individual re-
tirement accounts, escrow accounts, or savings bonds) that
allows savings of a family receiving aid to families with
dependent children to be used for qualified distributions.
‘‘(2) The term ‘qualified distributions’ means dis-
tributions for expenses directly related to 1 or more of
the following purposes:
‘‘(A) The attendance of a member of the family
at any education or training program.
‘‘(B) The improvement of the employability (in-
cluding self-employment) of a member of the family
(such as through the purchase of an automobile).
‘‘(C) The purchase of a home for the family.
‘‘(D) A change of the family residence.’’.
(g) DISREGARD OF INCOME AND RESOURCES RELAT-
ED TO SELF-EMPLOYMENT.—
(1) STATE
PLAN
REQUIREMENTS.—Section
402(a) (42 U.S.C. 602(a)) is amended—
(A) by striking ‘‘and’’ at the end of para-
graph (44);
(B) by striking the period at the end of
paragraph (45) and inserting ‘‘; and’’; and
(C) by inserting after paragraph (45) the
following new paragraph:
‘‘(46) at the option of the State (on a statewide
basis or in a defined area of the State), provide that
the State agency for a period not to exceed 2
years—
‘‘(A)(i) shall not include as a resource of
the family of which a child referred to in para-
graph (7)(A) is a member, for purposes of
paragraph (7)(B), the lesser of—
‘‘(I) the first $10,000 of the net
worth (assets reduced by liabilities with re-
spect thereto) of all microenterprises (as
defined in section 406(l)(1)) owned, in
whole or in part, by the child or by a rel-
ative or other individual referred to in
paragraph (7)(A), or
‘‘(II) such net worth attributable to
such ownership; and
‘‘(ii) shall take into consideration as
earned income of the family of which the child
is a member, only the net profits (as defined in
section 406(l)(2)) of such microenterprises; and
‘‘(B) shall ensure that caseworkers are
able to properly advise recipients of aid under
the State plan of the option of microenterprise
as a legitimate route toward self-sufficiency,
and that caseworkers encourage recipients of
such aid who are interested in starting a
microenterprise to participate in a program de-
signed to assist them in such effort.’’.
(2) DEFINITIONS.—Section 406 (42 U.S.C.
606), as amended by section 101(b) of this Act and
subsection (f)(3) of this section, is amended by add-
ing at the end the following new subsection:
‘‘(l)(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) payments of principal or interest on a loan
to the microenterprise;
‘‘(B) transportation expenses;
‘‘(C) inventory costs;
‘‘(D) expenditures to purchase capital equip-
ment;
‘‘(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) (42
U.S.C. 682(d)(1)) is amended by adding at the
end the following new subparagraph:
‘‘(C) The services and activities referred to in sub-
paragraph (A)—
‘‘(i) in the case of a State in which 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 preceding fiscal year) elect to partici-
pate in microenterprise activities, shall include pro-
grams described in paragraph (4); or
‘‘(ii) in the case of a State in which less than
3 percent of the adult recipients of such aid (as of
such time) elect to participate in microenterprise ac-
tivities, may include programs described in para-
graph (4).’’.
(B) MICROENTERPRISE
PROGRAMS.—Sec-
tion 482(d) (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.’’.
(h) EXTENSION OF TRANSITIONAL CHILD CARE.—
Section 402(g)(1)(A)(iii) (42 U.S.C. 602(g)(1)(A)(iii)) is
amended by striking ‘‘12 months’’ and inserting ‘‘24
months’’.
(i) EFFECTIVE DATE.—Except as provided in section
111, the amendments made by this section shall take ef-
(1) in subparagraph (A), by inserting ‘‘, or at
the option of the State (on a statewide basis or in
a defined area of the State), the greater of $90, or
the first 20 percent of such total’’ before the comma
at the end;
(2) by striking ‘‘and’’ at the end of subpara-
graph (C); and
(3) by striking the semicolon at the end of sub-
paragraph (D) and inserting ‘‘, (E) an amount equal
to the expenditure for care in such month for a de-
pendent child of the stepparent who is living in the
same home as the stepparent, not receiving aid to
families for dependent children, and requiring care
for such month to the extent that such amount (for
each such dependent child) does not exceed $175 (or
such lesser amount as the Secretary may prescribe
in the case of an individual not engaged in full-time
employment, or not employed throughout the
month), or, in the case such child is under age 2,
$200, and (F) at the option of the State (on a state-
wide basis or in a defined area of the State), up to
one-half of the total of such earned income not dis-
regarded under any other subparagraph of this para-
graph;’’.
(b) UNEMPLOYED PARENT HOUSEHOLDS.—
(1) ELIMINATION OF PRINCIPAL EARNER RE-
QUIREMENT.—
(A) IN GENERAL.—Section 407 (42 U.S.C.
607) is amended—
(i) by striking ‘‘of the parent who is
the principal earner’’ in subsection (a) and
inserting ‘‘of either parent in a home in
which both parents of such child are liv-
ing’’;
(ii) by striking ‘‘the parent who is the
principal 
earner’’ 
in 
subsection
(b)(2)(B)(ii)(II) and inserting ‘‘either par-
ent’’;
(iii) by striking ‘‘; and’’ at the end of
paragraph (3) of subsection (d) and insert-
ing a period; and
(iv) by striking paragraph (4) of sub-
section (d).
(B) CONFORMING
AMENDMENT.—Section
402(a)(19)(D) (42 U.S.C. 602(a)(19)(D)) is
amended by striking ‘‘the parent who is the
principal earner’’ and inserting ‘‘either parent’’.
(2) 
MODIFICATION
OF
OTHER
REQUIRE-
MENTS.—Subparagraph (A) of section 407(b)(1) (42
U.S.C. 607(b)(1)) is amended to read as follows:
‘‘(A) subject to paragraph (2), shall require the
payment of aid to families with dependent children
with respect to a dependent child as defined in sub-
section (a) when—
‘‘(i) for at least 30 days—
‘‘(I) prior to the receipt of aid, either
parent has been employed for less than a
monthly cap specified by the State plan
(not to exceed 100 hours), and at the time
of the application for aid, both parents are
employed for less than such monthly cap;
or
‘‘(II) after the application for aid, one
or both parents are employed for less than
the 
monthly 
cap 
established 
under
subclause (I),
‘‘(ii) either such parent has not without
good cause, within such period (of not less than
30 days) as may be prescribed by the Secretary,
refused a bona fide offer of employment or
training for employment, and
‘‘(iii) notwithstanding the number of hours
either such parent is working after the initial
determination of eligibility, such family remains
otherwise eligible for payment under this sec-
tion; and’’.
(c) 
INCREASE
IN
ASSET
LIMITS.—Section
402(a)(7)(B) (42 U.S.C. 602(a)(7)(B)) is amended in the
matter preceding clause (i) by inserting ‘‘(or, at the option
of the State (on a statewide basis or in a defined area
of the State), exceeds an amount prescribed by the State
not to exceed $2,000 for applicant families and $5,000
for recipient families)’’ after ‘‘may determine’’.
(d) INCREASE IN MOTOR VEHICLE LIMIT.—Section
402(a)(7)(B) (42 U.S.C. 602(a)(7)(B)), as amended by
section 102(f) of this Act, is amended—
(1) in clause (i), by striking ‘‘and so much of
the family member’s ownership interest in one auto-
mobile as does not exceed such amount as the Sec-
retary may prescribe’’;
(2) by striking ‘‘or’’ at the end of clause (iv);
and
(3) by striking ‘‘; and’’ at the end of clause (v)
and inserting ‘‘, or (vi) the greater of so much of the
family member’s ownership interest in 1 automobile
as does not exceed (I) such amount as the Secretary
may prescribe, or (II) at the option of the State (on
a statewide basis or in a defined area of the State),
an amount not to exceed $3,000, adjusted on Octo-
ber 1 of each year (beginning in 1994) to equal the
amount determined under this subclause for the pre-
vious fiscal year plus the product of such amount
and the increase in the Consumer Price Index for
used vehicles during such fiscal year; and’’.
(e) EFFECTIVE DATE.—Except as provided in section
111, the amendments made by this section shall take ef-
fect on the first day of the first fiscal year beginning after
the date of the enactment of this Act.
SEC. 105. WORK REQUIREMENTS FOR UNEMPLOYED PAR-
ENTS.
(a) ELIMINATION OF REQUIRED PARTICIPATION OF
ONE PARENT
IN WORK COMPONENT
OF JOBS PRO-
GRAM.—Section 403(l) (42 U.S.C. 603(l)) is amended by
striking paragraph (4).
(b) REQUIRED
PARTICIPATION
OF
BOTH
PAR-
ENTS.—Section 407(b)(2)(A) (42 U.S.C. 607(b)(2)(A)) is
amended to read as follows:
‘‘(2)(A)(i) In carrying out the program under this
section, a State may condition continued eligibility for aid
to families with dependent children by reason of the unem-
ployment of either parent, on the participation of both
parents in a program established by the State agency
which shall include job search activities, counseling, and
training services when the State agency determines that
such participation is required, except as provided in clause
(ii).
‘‘(ii) A parent shall not be subject to the requirement
under subparagraph (A), if such parent is employed at
least 30 hours per week, is needed in the home to care
for a child under 6 months of age, or if the State agency
determines the existence of other good cause.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall take effect on the first day of the first
fiscal year beginning after the date of the enactment of
this Act.
SEC. 106. JOBS PROGRAM.
(a) REQUIREMENT
OF JOBS PARTICIPATION
OF
PREGNANT
INDIVIDUALS.—Section 402(a)(19)(C) (42
U.S.C. 602(a)(19)(C)) is amended—
(1) by inserting ‘‘or’’ at the end of clause (v);
(2) by striking clause (vi); and
(3) by redesignating clause (vii) as clause (vi).
(b) NO LIMITATION ON LENGTH OF JOB SEARCH
PROGRAM.—Section 482(g)(2) (42 U.S.C. 682(g)(2)) is
amended by striking ‘‘402(a)(19)(D) applies’’ through the
end of subparagraph (B) and inserting ‘‘402(a)(19)(D)
applies.’’.
(c) PROTECTION OF EXISTING WORKERS.—
(1) NONDISPLACEMENT.—Section 484(c) (42
U.S.C. 684(c)) is amended by—
(A) by striking ‘‘or’’ at the end of para-
graph (2);
(B) by striking the period at the end of
paragraph (3) and inserting ‘‘; or’’; and
(C) by inserting after paragraph (3) the
following new paragraph:
‘‘(4) the employment or assignment of a partici-
pant or the filling of a position if such participant
will perform any services or duties, or engage in ac-
tivities, that—
‘‘(A) will supplant the hiring of employed
workers;
‘‘(B) are services, duties, or activities with
respect to which an individual has recall rights
pursuant to a collective bargaining agreement
or applicable personnel procedures; or
‘‘(C) had been performed by or were as-
signed to any employee who—
‘‘(i) is subject to a reduction in force;
or
‘‘(ii) has recall rights pursuant to a
collective bargaining agreement or applica-
ble personnel procedures.’’.
(2) CONCURRENCE OF LOCAL LABOR ORGANIZA-
TION.—Section 484 (42 U.S.C. 684) is amended by
adding at the end the following new subsection:
‘‘(g) No work assignment under the program shall
be made until the State agency has obtained from an em-
ployer with whom a participant is placed, the written con-
currence of any local labor organization representing em-
ployees of the employer who are engaged in the same or
substantially similar work as that proposed to be carried
out.’’.
(d) GRIEVANCE PROCEDURE.—Section 484(d)(1) (42
U.S.C. 684(d)(1)) is amended to read as follows:
‘‘(d)(1)(A) The State shall establish and maintain a
grievance procedure for resolving complaints by regular
employees or such employees’ representatives that the
work assignment of an individual under the program vio-
lates any of the prohibitions described in subsection (c).
‘‘(B) Except for a grievance that alleges fraud or
criminal activity, a grievance shall be made not later than
1 year after the date of the alleged occurrence of the event
that is the subject of the grievance.
‘‘(C)(i) A hearing on any grievance conducted under
this paragraph shall be conducted not later than 30 days
after the filing of such grievance.
‘‘(ii) A decision on any such grievance shall be made
not later than 60 days after the filing of such grievance.
‘‘(D)(i)(I) In the event of a decision on a grievance
that is adverse to the party who filed such grievance, or
60 days after the filing of such grievance if no decision
has been reached, such party shall be permitted to submit
such grievance to binding arbitration before a qualified ar-
bitrator who is jointly selected and independent of the in-
terested parties.
‘‘(II) If the parties cannot agree on an arbitrator, the
Governor shall appoint an arbitrator from a list of quali-
fied arbitrators within 15 days after receiving a request
for such appointment from one of the parties to the griev-
ance.
‘‘(ii) An arbitration proceeding shall be held not later
than 45 days after the request for such arbitration pro-
ceeding, or, if the arbitrator is appointed by the Governor
in accordance with clause (i)(II), not later than 30 days
after the appointment of such arbitrator.
‘‘(iii) A decision concerning a grievance shall be made
not later than 30 days after the date such arbitration pro-
ceeding begins.
‘‘(iv)(I) Except as provided in subclause (II), the cost
of an arbitration proceeding shall be divided evenly be-
tween the parties to the arbitration.
‘‘(II) If a regular employee or such employee’s rep-
resentative prevails under a binding arbitration proceed-
ing, the State agency shall pay the total cost of such pro-
ceeding and the attorneys’ fees of such employee or rep-
resentative.
‘‘(E) Remedies for a grievance filed under this para-
graph include—
‘‘(i) prohibition of the work assignment in the
program under this part; and
‘‘(ii)(I) reinstatement of the displaced employee
to the position held by such employee prior to dis-
placement;
‘‘(II) payment of lost wages and benefits of the
displaced employee;
‘‘(III) reestablishment of other relevant terms,
conditions, and privileges of employment of the dis-
placed employee; and
‘‘(IV) such equitable relief as is necessary to
make the displaced employee whole.
‘‘(F) Suits to enforce arbitration awards under this
paragraph may be brought in any district court of the
United States having jurisdiction of the parties, without
regard to the amount in controversy and without regard
to the citizenship of the parties.’’.
(e) EFFECTIVE DATE.—Except as provided in section
111, the amendments made by this section shall take ef-
fect on the first day of the first fiscal year beginning after
the date of the enactment of this Act.
SEC. 107. INCREASED PAYMENTS TO STATES.
(a) CHANGES TO JOBS PAYMENT FORMULA.—
(1) IN
GENERAL.—Section 403(l)(1)(A) (42
U.S.C. 603(l)(1)(A)) is amended—
(A) by striking ‘‘and’’ at the end of clause
(i);
(B) in clause (ii), in the matter preceding
subclause (I), by striking ‘‘described in clause
(i)’’ and inserting ‘‘described in clause (i) but
do not exceed the amount of such expenditures
in fiscal year 1994’’;
(C) by striking the period at the end of
clause (ii) and inserting ‘‘; and’’; and
(D) by adding at the end the following new
clause:
‘‘(iii) with respect to so much of the expendi-
tures in a fiscal year that exceed the sum of the
amounts described in clauses (i) and (ii)—
‘‘(I) 50 percent in the case of expenditures
described in clause (i)(II), and
‘‘(II) in the case of expenditures made by
a State in operating such a program for a fiscal
year (other than for costs described in
subclause (I)), the greater of—
‘‘(aa) 70 percent, or
‘‘(bb) the Federal medical assistance
percentage (as defined in section 1118 in
the case of any State to which section
1108 applies, or as defined in section
1905(b) in the case of any other State).’’.
(2) EFFECTIVE DATE.—The amendments made
by paragraph (1) shall apply with respect to pay-
ments made on and after October 1, 1994.
(b) INCREASE
IN
JOBS PROGRAM
AUTHORIZA-
TION.—Section 403(k)(3) (42 U.S.C. 603(k)(3)) is
amended—
(1) by striking subparagraphs (E) and (F); and
(2) by inserting after subparagraph (D) the fol-
lowing new subparagraphs:
‘‘(E) $1,500,000,000 in the case of fiscal year
1995,
‘‘(F) $2,000,000,000 in the case of fiscal year
1996,
‘‘(G) $2,500,000,000 in the case of fiscal year
1997,