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—
‘‘(A) during the period of the agreement,
to reflect substantial changes in family cir-
cumstances or needs; and
‘‘(B) at the conclusion of the original
agreement, if each relative and any other indi-
vidual entering into the agreement has made a
good faith effort to comply with the agreement
but were unable to reach self-sufficiency be-
cause of factors outside of the control of the
relative or other individual;
‘‘(8) provides that the family will automatically
enter into a limited benefit plan (as described in
subsection (j)) if a relative or other individual who
has entered into the family investment agreement
fails to comply with the agreement; and
‘‘(9) provides that the agreement shall be in-
valid if the State agency fails to comply with the
agreement.
‘‘(j) The term ‘limited benefit plan’ means a plan
which, notwithstanding any other provision of this title,
provides that—
‘‘(1)(A) during the first 3-month period in
which a family receives aid under the plan, the fam-
ily shall receive benefits as normally determined
under this title;
‘‘(B) during the second 3-month period in
which the family receives aid under the plan, the
needs of the caretaker relative, any other relative
with whom a dependent child 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), shall not be taken into account in making
the determination with respect to the family for pur-
poses of paragraph (7) and in the case of a family
which is eligible by reason of section 407, both par-
ents shall not be taken into account into making
such a determination; and
‘‘(C) after the expiration of a 6-month period
beginning on the date on which the family enter into
the limited benefit plan, the family shall be ineligible
for benefits under this title and may not reapply for
such benefits within a 6 month period beginning on
the date of such expiration;
‘‘(2) during the duration of a limited benefit
plan, a third-party counselor shall inquire as to the
well being of the dependent children; and
‘‘(3) within a 45-day period beginning on the
date that the family automatically enters a limited
benefit plan by reason of the family investment
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
(B) by inserting ‘‘, or (v) at the option of
the State (on a statewide basis or in a defined
area of the State), in the case of a family re-
ceiving aid under the State plan (and a family
not receiving such aid but which received such
aid in at least 1 of the preceding 4 months or
became ineligible for such aid during the pre-
ceding 12 months because of excessive earn-
ings), any amount not to exceed $10,000 in a
qualified asset account (as such term is defined
in section 406(k)) of such family, reduced by
the amount (if any) excluded from the resources
of the family pursuant to paragraph (46)(A)(i)’’
before ‘‘; and’’.
(2) DISREGARD AS INCOME.—
(A) NONRECURRING
LUMP
SUM
EXEMPT
FROM
LUMP-SUM
RULE.—Section 402(a)(17)
(42 U.S.C. 602(a)(17)) is amended by adding
at the end the following: ‘‘; at the option of the
State (on a statewide basis or in a defined area
of the State), that this paragraph shall not
apply to earned or unearned income received in
a month on a nonrecurring basis to the extent
that such income is placed in a qualified asset
account (as defined in section 406(k)) the total
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-
fect on the first day of the first fiscal year beginning after
the date of the enactment of this Act.
SEC. 103. OPTIONAL STATE DISREGARD OF DEPENDENT
CHILD’S INCOME.
(a) IN GENERAL.—Section 402(a)(8) (42 U.S.C.
602(a)(8)), as amended by subsections (c) and (e) of sec-
tion 102 of this Act, is amended—
(1) by striking ‘‘and’’ at the end of clause (ix);
(2) by striking the semicolon at the end of
clause (x) and inserting ‘‘; and’’; and
(3) by inserting after clause (x) the following
new clause:
‘‘(xi) at the option of the State (on a state-
wide basis or in a defined area of the State),
may disregard all or any part of the earned in-
come of a dependent child; and’’.
(b) 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. 104. FAMILY STABILITY.
(a) EQUIVALENT TREATMENT OF STEPPARENT IN-
COME
AND PARENT INCOME.—Section 402(a)(31) (42
U.S.C. 602(a)(31)) is amended—
(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,
‘‘(H) $3,000,000,000 in the case of fiscal year
1998, and
‘‘(I) $3,500,000,000 in the case of fiscal year
1999.’’.
(c) INCREASE
IN CHILD CARE PAYMENT FOR-
MULA.—
(1) IN GENERAL.—
(A) 
INCREASED
PERCENTAGE.—Section
402(g)(3)(A)(i) of the Social Security Act (42
U.S.C. 602(g)(3)(A)(i)) is amended to read as
follows:
‘‘(3)(A)(i) In the case of expenditures in any fiscal
year for child care pursuant to paragraph (1)(A) by any
State to which section 1108 does not apply, the applicable
rate for purposes of section 403(a) shall be—
‘‘(I) with respect to so much of such expendi-
tures as does not exceed the State’s expenditures in
the fiscal year 1994, the Federal medical assistance
percentage (as defined in section 1905(b)), and
‘‘(II) with respect to so much of such expendi-
tures as exceed the amount described in subclause
(I), the sum of—
‘‘(aa) the Federal medical assistance per-
centage (as defined in section 1905(b)), and
‘‘(bb) one-half of the difference between
100 percent and such Federal medical assist-
ance percentage.’’.
(B) EFFECTIVE DATE.—The amendments
made by subparagraph (A) shall apply with re-
spect to payments made on and after October
1, 1994.
(2) CONFORMING AMENDMENTS.—
(A) IN GENERAL.—Section 402(g)(3)(A)(i)
of 
the 
Social 
Security 
Act 
(42 
U.S.C.
602(g)(3)(A)(i)), as amended by paragraph
(1)(A) of this subsection, is amended—
(i) by striking ‘‘(i)’’ after ‘‘(A)’’;
(ii) by striking ‘‘subclause (I)’’ in
subclause (II) and inserting ‘‘clause (i)’’;
(iii) by redesignating subclauses (I)
and (II) as clauses (i) and (ii), respec-
tively; and
(iv) by redesignating items (aa) and
(bb) as subclauses (I) and (II), respec-
tively.
(B) EFFECTIVE DATE.—The amendments
made by subparagraph (A) shall take effect on
September 30, 1998.
SEC. 108. ASSESSMENT, MONITORING, AND EVALUATION.
(a) IN
GENERAL.—Section 402(a) (42 U.S.C.
602(a)), as amended by section 102(g)(1) of this Act, is
amended—
(1) by striking ‘‘and’’ at the end of paragraph
(45);
(2) by striking the period at the end of para-
graph (46) and inserting ‘‘; and’’; and
(3) by inserting after paragraph (46) the fol-
lowing new paragraph:
‘‘(47) at the option of the State (on a statewide
basis or in a defined area of the State), provide that
the State agency (in order to increase the percentage
of families moving from welfare to self-sufficiency)—
‘‘(A) shall conduct an assessment, in con-
sultation with State and local elected officials,
current recipients of aid to families with de-
pendent children, recipients of community-based
service systems, and individuals with expertise
in business, education, child welfare, juvenile
justice, mental health, substance addiction,
housing, and labor—
‘‘(i) of the barriers which families that
receive aid to families with dependent chil-
dren face in achieving self-sufficiency, in-
cluding noneconomic barriers such as fam-
ily functions, parenting capacity, child de-
velopment, housing, substance abuse, and
mental illness;
‘‘(ii) of the capacity within the State
to provide employment opportunities to
families that receive aid to families with
dependent children and to address other
barriers such families face to achieving
self-sufficiency; and
‘‘(iii) of the number and skills of
workers needed to develop the family in-
vestment program under paragraph (29),
monitor progress, and adapt goals to meet
new challenges;
‘‘(B) shall establish a system to monitor
and evaluate both the economic gains related to
employment of individuals in households receiv-
ing aid to families with dependent children and
the social, health, educational, and developmen-
tal impact on children in such households that
result from efforts to achieve self-sufficiency;
and
‘‘(C) shall establish a system to determine
the number of individuals who achieve self-suffi-
ciency through the family investment program
under paragraph (29) and the rate of recidi-
vism.’’.
(b) EFFECTIVE DATE.—Except as provided in sec-
tion 111, 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. 109. TIMELY PREVENTIVE HEALTH CARE FOR CHIL-
DREN.
(a) IN
GENERAL.—Section 402(a) (42 U.S.C.
602(a)), as amended by section 102(g)(1) and 108(a) of
this Act, is amended—
(1) by striking ‘‘and’’ at the end of paragraph
(46);
(2) by striking the period at the end of para-
graph (47) and inserting ‘‘; and’’; and
(3) by inserting after paragraph (47) the fol-
lowing new paragraph:
‘‘(48) provide that (unless the State agency
provides the Secretary with adequate certification
that the care described in subparagraph (A)(i)(I) is
not accessible in the area in which a family re-
sides)—
‘‘(A)(i) the State shall decrease the
amount of aid paid to a family under this part
(determined without regard to subparagraph
(B)) by a percentage amount determined appro-
priate by the Secretary beginning in the month
following any month in which the State agency
has failed to receive—
‘‘(I) written verification that each
child in the family under 6 years of age
has been immunized and has received well-
baby and well-child care in accordance with
guidelines issued by the Surgeon General
of the Public Health Service; or
‘‘(II) notice of a medical justification
that would exempt the child or children
from receiving such care; and
‘‘(ii) the State shall end the reduction of
payment under clause (i) beginning in the
month following the month in which the State
agency receives the required verification; and
‘‘(B) aid under the plan to a family shall
be increased by a bonus payment equal to the
percentage amount determined by the Secretary
under subparagraph (A) in the month following
a month in which the State agency receives ver-
ification that each such child has received the
immunizations and care described in subpara-
graph (A)(i).’’.
(b) EFFECTIVE DATE.—Except as provided in sec-
tion 111, 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. 
110. 
WAGE 
SUPPLEMENTATION 
DEMONSTRATION
PROJECTS.
(a) IN GENERAL.—The Secretary of Health and
Human Services (hereafter in this section referred to as
the ‘‘Secretary’’) shall establish demonstration projects for
the purpose of developing a wage supplementation pro-
gram under which—
(1) certain individuals eligible for aid to fami-
lies with dependent children under title IV of the So-
cial Security Act (42 U.S.C. 601 et seq.) would be
given an incentive to work; and
(2) the State would use funds available to pay
benefits described in paragraph (1) and food stamp
benefits under the Food Stamp Act of 1977 (7
U.S.C. 2011 et seq.) to make monthly incentive pay-
ments (in lieu of such benefits) to such individuals.
Each such program shall meet the requirements of sub-
section (b).
(b) WAGE
SUPPLEMENTATION
DEMONSTRATION
PROJECT.—
(1) IN
GENERAL.—A demonstration project
conducted under this section shall provide the follow-
ing:
(A) INCENTIVES TO WORK.—The project
shall—
(i) require as a condition of participa-
tion in the project that an eligible individ-
ual be employed by a participating em-
ployer;
(ii) provide that the State shall make
monthly incentive payments to any eligible
individual for each month of employment
in an amount equal to the benefits de-
scribed in subsection (a)(2) which would
otherwise be payable to the individual, de-
termined as of the first day of the first full
month of employment of such individual by
a participating employer; and
(iii) provide that such payments be in
lieu of such benefits.
(B) 
PERIOD
OF
PARTICIPATION.—A
project shall not permit an eligible individual to
participate in the demonstration project for a
period in excess of the lesser of—
(i) an aggregate period of 48 months,
or
(ii) a period consisting of the number
of months in which such individual was
employed by a participating employer.
(C) INCOME IN EXCESS OF LIMIT.—The
project shall set a limit (to be determined by
the State) on the monthly income (including
payments under subparagraph (A)(ii)) of the
family of an eligible individual and shall permit
the State to—
(i) reduce payments under subpara-
graph (A)(ii) in excess of the limit; or
(ii) determine an individual ineligible
for participation in the project if such in-
come is in excess of the limit.
(2) SPECIAL RULES FOR TREATMENT UNDER
FEDERAL
PROGRAMS.—Notwithstanding any other
provision of law, the following special rules shall
apply to an eligible individual participating in the
project:
(A) WAGES AS EARNED INCOME.—Wages
paid to an eligible individual by a participating
employer (but not payments under the project)
shall be considered earned income.
(B) TREATED AS ELIGIBLES.—Except for
purposes of determining eligibility for benefits
for which payments under the project are in
lieu of, an eligible individual participating in the
project shall be treated as eligible—
(i) for aid to families with dependent
children under part A of title IV of the So-
cial Security Act (42 U.S.C. 601 et seq.);
and
(ii) for food stamp benefits under the
Food Stamp Act of 1977 (7 U.S.C. 2011
et seq.) if such individual was otherwise el-
igible for food stamp benefits, determined
as of the first day of the first full month
of the employment of such individual by a
employer.
(C) 
ADDITIONAL
CHILD
SUPPORT
AMOUNTS.—An eligible individual who partici-
pates in the demonstration project shall remain
eligible for the project notwithstanding the re-
ceipt of any amounts paid to the family of the
individual under section 457(b)(4)(B) of the
Social Security Act (42 U.S.C. 657(b)(4)(B)).
(D) HOUSING.—Any wages paid to an eli-
gible individual by a participating employer dur-
ing the period of time that an eligible individual
participates in the demonstration project shall
not be taken into account in determining—
(i) the monthly rent under section
3(a) of the United States Housing Act of
1937 for any family residing in a dwelling
unit assisted under such Act; and
(ii) the monthly assistance payment
for any family under section 8(o)(2) of
such Act.
(3) ELIGIBLE INDIVIDUAL AND PARTICIPATING
EMPLOYER.—
(A) ELIGIBLE INDIVIDUAL.—For purposes
of this section, an individual is an eligible indi-
vidual if the individual is in a category of indi-
viduals which the State determines should be el-
igible to participate in the demonstration
project, and who would, at the time of place-
ment in the job involved, be eligible for aid to
families with dependent children under an ap-
proved State plan under title IV of the Social
Security Act (42 U.S.C. 601 et seq.).
(B) PARTICIPATING EMPLOYER.—
(i) IN
GENERAL.—For purposes of
this section, an employer is a participating
employer, with respect to an eligible indi-
vidual, if the employer provides the State
with a written agreement certifying—
(I) that the employment of the
eligible individual complies with the
rules described in subsections (b), (c),
(d), and (g) of section 484 of the So-
cial Security Act (42 U.S.C. 684);
(II) that the gross wages (as de-
fined in section 209 of the Social Se-
curity Act (42 U.S.C. 609) deter-
mined without regard to any dollar
limitation) paid to such eligible indi-
vidual by the employer during any
month will not be less than the prod-
uct of—
(aa) the greater of the Fed-
eral minimum wage or the appli-
cable State minimum wage, and
(bb) the number of hours
worked by such individual;
(III) that the employer will not
receive any wage subsidy under any
other provision of Federal law, includ-
ing part F of title IV of the Social Se-
curity Act with respect to the employ-
ment of such eligible individual; and
(IV) that the eligible individual
receives the same employer-provided
benefits (other than health care bene-
fits) that other employees of the em-
ployer receive.
(ii) CONTINUING CERTIFICATION RE-
QUIREMENT.—A 
participating 
employer
shall be required to submit a monthly re-
port to the State (in a form and in such
manner as the State requires) certifying
that the employer has complied with the
requirements of subclauses (I), (II), (III),
and (IV) of clause (i) with respect to an el-
igible individual during the period such in-
dividual participates under the project.
(c) DURATION.—A demonstration project under this
Act shall be conducted for not more than 5 years (includ-
ing any time necessary for final evaluation and reporting).
The Secretary may terminate a project if the Secretary
determines that the State conducting the project is not
in substantial compliance with the terms of the application
approved by the Secretary under this section.
(d) APPLICATIONS.—
(1) IN GENERAL.—Each State desiring to con-
duct a demonstration project under this section shall
prepare and submit to the Secretary an application,
at such time, in such manner, and containing such
information as the Secretary may require, including
an explanation of a plan for evaluating the project.
(2) APPROVAL OF APPLICATIONS.—A State that
submits an application under paragraph (1) may
begin a demonstration project under this section—
(A) upon approval of such application by
the Secretary; or
(B) at the end of the 60-day period begin-
ning on the date such application is submitted,
unless the Secretary denies the application dur-
ing such period.
(3) NOTICE
AND
COMMENT.—A State shall
issue a public notice on the date the State submits
an application under paragraph (1) which contains
a general description of the proposed demonstration
project. Any interested party may comment on the
proposed demonstration project to the State or the
Secretary during the 30-day period beginning on the
date the public notice is issued.
(e) EVALUATIONS.—Each State conducting a dem-
onstration project under this section shall submit to the
Secretary an annual and final evaluation that determines
the success of the State’s demonstration project under this
section in moving people from welfare dependency to self-
sufficiency.
(f) FUNDING FOR DEMONSTRATION PROJECTS.—For
each State that conducts a demonstration project under
this section—
(1) the portion of the monthly payments that
the State makes to a participant in the project
under subsection (b)(1)(A)(ii) that is attributable to
aid to families with dependent children under part A
of title IV of the Social Security Act (42 U.S.C. 601
et seq.) shall be considered expenditures under the
State plan for such aid;
(2) the expenses incurred by the State in the
administration of the demonstration project shall be
considered expenditures by the State for administra-
tive costs in operating a program under part F of
title IV of the Social Security Act (42 U.S.C. 601
et seq.); and
(3) the portion of the monthly payments that
the State makes to a participant in the project that
is attributable to the cash value of food stamp bene-
fits under the Food Stamp Act of 1977 (7 U.S.C.
2011 et seq.) shall be considered to be expenditures
for food stamp benefits under such Act.
(g) MAINTENANCE OF EFFORT.—Any funds available
for the activities covered by a demonstration project con-
ducted under this section shall supplement, and shall not
supplant, funds that are expended for similar purposes
under any State, regional, or local program.
SEC. 111. DELAY IN CERTAIN EFFECTIVE DATES.
In the case of a State that the Secretary of Health
and Human Services determines requires State legislation
(other than legislation appropriating funds) in order to
meet the additional requirements imposed by the amend-
ments made by section 101, 102, 104, 106, and 108, the
State shall not be regarded as failing to comply with the
requirements of such amendments before the first day of
the first calendar quarter beginning after the close of the
first regular session of the State legislature that begins
after October 1, 1994, if such State legislature did not
meet in a regular session after the date of the enactment
of this Act and before October 1, 1994. For purposes of
this subsection, in the case of a State that has a 2-year
legislative session, each year of the session shall be treated
as a separate regular session of the State legislature.
TITLE 
II—IMPROVEMENTS 
IN
THE COLLECTION OF CHILD
SUPPORT
SEC. 201. TRANSMISSION AND ASSIGNMENT OF CERTAIN
CHILD SUPPORT ORDERS TO THE IRS.
Section 466(a) (42 U.S.C. 666(a)) is amended by in-
serting after paragraph (11) the following new paragraph:
‘‘(12)(A) Procedures which require any State
court or administrative agency that issues or modi-
fies (or has issued or modified) a child support order
(including an order for the payment of past-due sup-
port) to transmit a copy of the order to the Internal
Revenue Service upon the completion of a 12-month
period during which less than 50 percent of the
court-ordered child support amount for such period
has been paid.
‘‘(B) Procedures which—
‘‘(i) require any individual with the right
to collect child support pursuant to an order is-
sued or modified in the State (whether before
or after the effective date of this paragraph) to
be presumed to have assigned to the Internal
Revenue Service the right to collect such sup-
port (including any past-due support) pursuant
to subparagraph (A), unless the individual af-
firmatively elects to retain such right at any
time; and
‘‘(ii) allow any individual who has made
the election referred to in clause (i) to rescind
or revive such election at any time.’’.
SEC. 202. COLLECTION OF CHILD SUPPORT BY INTERNAL
REVENUE SERVICE.
(a) IN GENERAL.—Chapter 77 of the Internal Reve-
nue Code of 1986 (relating to miscellaneous provisions)
is amended by adding at the end the following new section:
‘‘SEC. 7524. COLLECTION OF CHILD SUPPORT.
‘‘(a) IN GENERAL.—The Secretary shall establish a
program to collect child support (including past-due sup-
port) pursuant to child support orders which are assigned
to the Internal Revenue Service under section 466(a)(12)
of the Social Security Act.
‘‘(b) USE OF WAGE WITHHOLDING, ETC.—Such pro-
gram shall provide for the collection of child support re-
quired to be paid for any period through increases in wage
withholding under chapter 24 and estimated tax payments
under section 6654 during such period. Amounts required
to be paid through such withholding and payments shall
be treated as tax for purposes for this subtitle.
‘‘(c) ANNUAL RECKONING OF OBLIGATION.—
‘‘(1) IN GENERAL.—The entire amount of child
support required to be paid by any individual to the
Internal Revenue Service during any taxable year
shall be paid—
‘‘(A) not later than the last date (deter-
mined without regard to extensions) prescribed
for filing such individual’s return of tax im-
posed by chapter 1 for such taxable year, and
‘‘(B)(i) if such return is filed not later
than such date, with such return, or
‘‘(ii) in any case not described in subpara-
graph (A), in such manner as the Secretary
may by regulations prescribe.
‘‘(2) CREDIT FOR PERIODIC PAYMENTS.—The
amount required to be paid under paragraph (1)
shall be reduced by the aggregate payments of child
support made under subsection (b) by such individ-
ual through increases in wage withholding and esti-
mated tax payments.
‘‘(d) FAILURE TO PAY AMOUNT OWING.—If an indi-
vidual fails to pay the full amount required to be paid on
or before the last date described in subsection (c)(1), the
Secretary shall assess and collect the unpaid amount in
the same manner, with the same powers, and subject to
the same limitations applicable to a tax imposed by sub-
title C the collection of which would be jeopardized by
delay, except that—
‘‘(1) for such purposes, paragraphs (4), (6),
and (8) of section 6334(a) (relating to property ex-
empt from levy) shall not apply, and
‘‘(2) there shall be exempt from levy so much
of the salary, wages, or other income of an individ-
ual as is being withheld therefrom in garnishment
pursuant to a judgment entered by a court of com-
petent jurisdiction for the support of the individual’s
minor children.
‘‘(e) COLLECTIONS
DISPERSED
TO
INDIVIDUAL
SPECIFIED IN ORDER.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), amounts collected under this section pur-
suant to any child support order shall be paid to the
individual entitled to such amounts under such order
as quickly as possible. Any penalties and interest
collected with respect to such amounts also shall be
paid to such individual.
‘‘(2) FAMILIES
RECEIVING
STATE
ASSIST-
ANCE.—In the case of an individual with respect to
whom—
‘‘(A) an assignment of child support pay-
ments to a State under section 402(a)(26) or
471(a)(17) of the Social Security Act is in ef-
fect, or
‘‘(B) an application for State assistance
under section 454(6) is in effect,
amounts collected under this section shall be paid to
such State pursuant to section 457 of such Act.
‘‘(f) COORDINATION WITH UNDERPAYMENT PROVI-
SIONS.—If the Secretary is collecting—
‘‘(1) unpaid child support pursuant to an as-
sessment under this section, and
‘‘(2) unpaid tax pursuant to an assessment
under section 6203,
all amounts collected shall be treated as collected pursuant
to the assessment under this section to the extent of the
amount of such unpaid child support.
‘‘(g) LIMITATION ON JUDICIAL REVIEW.—No court
of the United States shall have jurisdiction to hear any
action, whether legal or equitable, brought to restrain or
review any assessment or collection authorized by this sec-
tion, nor shall any such assessment or collection be subject
to review by the Secretary in an administrative proceeding.
This subsection shall not preclude any legal, equitable, or
administrative action against the State by an individual
in any State court or before any State agency to determine
his liability for any amount assessed against him and col-
lected, or to recover any such amount collected from him,
under this section.
‘‘(h) REGULATIONS.—The Secretary shall prescribe
such regulations as may be appropriate to carry out the
purposes of this section.’’.
(b) ESTIMATE OF INCREASED INTERNAL REVENUE
FUNDING.—Within 1 year of the date of the enactment
of this Act, the Secretary of the Treasury shall submit
to the Congress an estimate of the additional cost per fis-
cal year for administering the program described in sec-
tion 7524 of the Internal Revenue Code of 1986 (as added
by this section).
(c) CLERICAL AMENDMENT.—The table of sections
for chapter 77 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new item:
‘‘Sec. 7524. Collection of child support.’’
SEC. 203. PUBLICATION OF DELINQUENT CHILD SUPPORT
OBLIGORS.
Section 454 (42 U.S.C. 654) is amended by striking
‘‘and’’ at the end of paragraph (23), by striking the period
at the end of paragraph (24) and inserting ‘‘; and’’, and
by inserting after paragraph (24) the following new para-
graph:
‘‘(25) at the option of the State, provide that
with respect to any child support order enforced by
the State under this part in which no payment has
been made during a preceding 3-month period, the
State make available for publication on a semi-an-
nual basis a listing of all such orders by name of the
support obligor, verified city and State address of
such obligor, and any other information deemed ap-
propriate by the State, and publicize the existence of
such listing to such support obligors.’’.
SEC. 204. EFFECTIVE DATE.
(a) IN GENERAL.—Except as provided in subsection
(b), the amendments made by this title shall take effect
on the first day of the first fiscal year beginning after the
date of the enactment of this Act.
(b) EXCEPTION.—In the case of a State that the Sec-
retary of Health and Human Services determines requires
State legislation (other than legislation appropriating
funds) in order to meet the additional requirements im-
posed by the amendments made by this title, the State
shall not be regarded as failing to comply with the require-
ments of such amendments before the first day of the first
calendar quarter beginning after the close of the first reg-
ular session of the State legislature that begins after Octo-
ber 1, 1994, if such State legislature did not meet in a
regular session after the date of the enactment of this Act
and before October 1, 1994. For purposes of this sub-
section, in the case of a State that has a 2-year legislative