[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 455 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 455

To amend title IV of the Social Security Act to remove the barriers and 
disincentives in the program of aid to families with dependent children 
      that prevent recipients of such aid from moving toward self-
                              sufficiency.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 6, 1993

 Mr. Hall of Ohio (for himself, Mr. Grandy, Mrs. Collins of Illinois, 
 and Mr. Emerson) introduced the following bill; which was referred to 
                    the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend title IV of the Social Security Act to remove the barriers and 
disincentives in the program of aid to families with dependent children 
      that prevent recipients of such aid from moving toward self-
                              sufficiency.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Microenterprise and Asset 
Development Act''.

SEC. 2. DISREGARD OF INCOME AND RESOURCES DESIGNATED FOR EDUCATION, 
              TRAINING, AND EMPLOYABILITY.

    (a) Disregard as Resource.--Section 402(a)(7)(B) of the Social 
Security Act (42 U.S.C. 602(a)(7)(B)) is amended--
            (1) by striking ``or'' before ``(iv)''; and
            (2) by inserting ``, or (v) in the case of a family 
        receiving 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 
        preceding 12 months because of excessive earnings), any amount 
        not to exceed $10,000 in a qualified asset account (as defined 
        in section 406(i)) of such family'' before ``; and''.
    (b) Disregard as Income.--
            (1) In general.--Section 402(a)(8)(A) of such Act (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 following 
                new clause:
                            ``(ix) shall disregard any interest or 
                        income earned on a qualified asset account (as 
                        defined in section 406(i)); and''.
            (2) Nonrecurring lump sum exempt from lump sum rule.--
        Section 402(a)(17) of such Act (42 U.S.C. 602(a)(17)) is 
        amended by adding at the end the following: ``; and 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(i)) the total amounts in which, after such 
        placement, does not exceed $10,000;''.
            (3) Treatment as income.--Section 402(a)(7) of such Act (42 
        U.S.C. 602(a)(7)) is amended--
                    (A) by striking ``and'' at the end of subparagraph 
                (B);
                    (B) by striking the semicolon at the end of 
                subparagraph (C) and inserting ``; and''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(D) shall treat as income any distributions from 
                a qualified asset account (as defined in section 
                406(i)(1)) which do not meet the definition of a 
                qualified distribution under section 406(i)(2);''.
    (c) Qualified Asset Accounts.--Section 406 of such Act (42 U.S.C. 
606) is amended by adding at the end the following:
    ``(i)(1) The term `qualified asset account' means a mechanism 
approved by the State (such as individual retirement 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 distributions 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 (including 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.''.
    (d) Study of Use of Qualified Asset Accounts; Report.--The 
Secretary of Health and Human Services shall conduct a study of the use 
of qualified asset accounts established pursuant to the amendments made 
by this section, and shall report on such study and any recommendations 
for modifications of such amendments to the Committee on Finance of the 
Senate and the Committee on Ways and Means of the House of 
Representatives not later than January 1, 1996.
    (e) Report on AFDC Asset Limit on Automobiles.--Within 3 months 
after the date of the enactment of this section, the Secretary of 
Health and Human Services shall submit to the Congress a report on--
            (1) the need to revise the limitation, established in 
        regulations pursuant to section 402(a)(7)(B)(i) of the Social 
        Security Act, on the value of a family automobile required to 
        be disregarded by a State in determining the eligibility of the 
        family for aid to families with dependent children under the 
        State plan approved under part A of title IV of such Act; and
            (2) the extent to which such a revision would increase the 
        employability of recipients of such aid.
    (f) Effective Date.--The amendments made by this section shall take 
effect on October 1, 1993.

SEC. 3. DISREGARD OF INCOME AND RESOURCES RELATED TO SELF-EMPLOYMENT.

    (a) State Plan Requirements.--Section 402(a) of the Social Security 
Act (42 U.S.C. 602(a)) is amended--
            (1) by striking ``and'' at the end of paragraph (44);
            (2) by striking the period at the end of paragraph (45) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (45) the following:
            ``(46) provide that the State agency--
                    ``(A)(i) shall not include as a resource of the 
                family of which a child referred to in paragraph (7)(A) 
                is a member, for purposes of paragraph (7)(B), the 
                first $10,000 of the net worth (assets reduced by 
                liabilities with respect thereto) of all 
                microenterprises (as defined in section 406(j)(1)) 
                owned, in whole or in part, by the child or by a 
                relative or other individual referred to in paragraph 
                (7)(A), for a period not to exceed 2 years; 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(j)(2)) 
                of such microenterprises, for a period not to exceed 2 
                years; 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 
                towards self-sufficiency, and that caseworkers 
                encourage recipients of such aid who are interested in 
                starting a microenterprise to participate in a program 
                designed to assist them in such effort.''.
    (b) Definitions.--Section 406 of such Act (42 U.S.C. 606), as 
amended by section 2(c) of this Act, is amended by adding at the end 
the following:
    ``(j)(1) The term `microenterprise' means a commercial 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 equipment;
            ``(E) cash retained by the microenterprise for future use 
        by the business;
            ``(F) taxes paid by reason of the business;
            ``(G) if the business is covered under a policy of 
        insurance against loss--
                    ``(i) the premiums paid for such insurance; and
                    ``(ii) the losses incurred by the business that are 
                not reimbursed by the insurer solely by reason of the 
                existence of a deductible with respect 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.''.
    (c) Inclusion of Microenterprise Training and Activities in the 
JOBS Program.--
            (1) In general.--Section 482(d)(1) of such Act (42 U.S.C. 
        682(d)(1)) is amended by adding at the end the following:
    ``(C) The services and activities referred to in subparagraph (A)--
            ``(i) in the case that at least 3 percent of the adult 
        recipients of aid under the State plan approved under part A 
        (as of the close of the immediately preceding fiscal year) 
        elect to participate in microenterprise activities, shall 
        include programs described in paragraph (4); or
            ``(ii) in the case that not more than 3 percent of the 
        adult recipients of such aid elect to participate in 
        microenterprise activities, may include programs described in 
        paragraph (4).''.
            (2) Microenterprise programs.--Section 482(d) of such Act 
        (42 U.S.C. 682(d)) is amended by adding at the end the 
        following:
    ``(4) The programs described in this paragraph are programs of 
public and private organizations, agencies, and other entities 
(including nonprofit and for-profit entities) to enable such entities 
to facilitate economic development by--
            ``(A) providing technical assistance, advice, and business 
        support services (including assistance, advice, and support 
        relating to business planning, financing, marketing, and other 
        microenterprise development 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.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to payments under part A of title IV of the Social Security Act 
for calendar quarters beginning on or after October 1, 1993.

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