[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3612 Introduced in House (IH)]







104th CONGRESS
  2d Session
                                H. R. 3612

 To reform the Nation's welfare system by requiring work and demanding 
                        personal responsibility.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 11, 1996

 Mr. Gibbons (for himself, Mr. McDermott, Mr. Matsui, Mr. Cardin, and 
Mr. Lewis of Georgia) introduced the following bill; which was referred 
   to the Committees on Agriculture, Banking and Financial Services, 
 Economic and Educational Opportunities, the Judiciary, Commerce, the 
  Budget, National Security, International Relations, and Government 
Reform and Oversight, for a period to be subsequently determined by the 
  Speaker, in each case for consideration of such provisions as fall 
           within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
 To reform the Nation's welfare system by requiring work and demanding 
                        personal responsibility.

    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 ``Work First and Personal 
Responsibility Act of 1996''.

SEC. 2. TABLE OF CONTENTS; AMENDMENT OF THE SOCIAL SECURITY ACT.

    (a) Table of Contents.--This Act is organized as follows:

Section 1. Short title.
Sec. 2. Table of contents; amendment of the Social Security Act.
                     TITLE I--WORK-BASED ASSISTANCE

Sec. 101. Purpose.
              Subtitle A--Temporary Employment Assistance

Sec. 102. State plan.
Sec. 103. Conforming amendments relating to collection of overpayments.
Sec. 104. Territories.
Sec. 105. Effective dates.
                       Subtitle B--Make Work Pay

Sec. 111. Transitional medicaid benefits.
Sec. 112. Notice of availability required to be provided to applicants 
                            and former recipients of temporary 
                            employment assistance, food stamps, and 
                            medicaid.
Sec. 113. Advance payment of earned income tax credit through State 
                            demonstration programs.
Sec. 114. Consolidated child care development block grant.
Sec. 115. Effective dates.
                         Subtitle C--Work First

Sec. 121. Work First program.
Sec. 122. Regulations.
Sec. 123. Applicability to States.
Sec. 124. One time increases in Work First program funds.
               Subtitle D--Pregnancy and Family Stability

Sec. 131. Supervised living arrangements for minors.
Sec. 132. National Clearinghouse on Adolescent Pregnancy.
Sec. 133. Required completion of high school or other training for 
                            teenage parents.
Sec. 134. Second chance homes.
                  TITLE II--CHILD SUPPORT ENFORCEMENT

     Subtitle A--Eligibility for Services; Distribution of Payments

Sec. 201. State obligation to provide child support enforcement 
                            services.
Sec. 202. Distribution of payments.
Sec. 203. Privacy safeguards.
Sec. 204. Rights to notification.
                  Subtitle B--Locate and Case Tracking

Sec. 211. State case registry.
Sec. 212. Collection and disbursement of support payments.
Sec. 213. State directory of new hires.
Sec. 214. Amendments concerning income withholding.
Sec. 215. Locator information from interstate networks.
Sec. 216. Expansion of the Federal parent locator service.
Sec. 217. Collection and use of social security numbers for use in 
                            child support enforcement.
         Subtitle C--Streamlining and Uniformity of Procedures

Sec. 221. Adoption of uniform State laws.
Sec. 222. Improvements to full faith and credit for child support 
                            orders.
Sec. 223. Administrative enforcement in interstate cases.
Sec. 224. Use of forms in interstate enforcement.
Sec. 225. State laws providing expedited procedures.
                  Subtitle D--Paternity Establishment

Sec. 231. State laws concerning paternity establishment.
Sec. 232. Outreach for voluntary paternity establishment.
Sec. 233. Cooperation requirement and good cause exception.
             Subtitle E--Program Administration and Funding

Sec. 241. Performance-based incentives and penalties.
Sec. 242. Federal and State reviews and audits.
Sec. 243. Required reporting procedures.
Sec. 244. Automated data processing requirements.
Sec. 245. Technical assistance.
Sec. 246. Reports and data collection by the Secretary.
      Subtitle F--Establishment and Modification of Support Orders

Sec. 251. Simplified process for review and adjustment of child support 
                            orders.
Sec. 252. Furnishing consumer reports for certain purposes relating to 
                            child support.
Sec. 253. Nonliability for financial institutions providing financial 
                            records to State child support enforcement 
                            agencies in child support cases.
               Subtitle G--Enforcement of Support Orders

Sec. 261. Internal Revenue Service collection of arrearages.
Sec. 262. Authority to collect support from Federal employees.
Sec. 263. Enforcement of child support obligations of members of the 
                            Armed Forces.
Sec. 264. Voiding of fraudulent transfers.
Sec. 265. Work requirement for persons owing past-due child support.
Sec. 266. Definition of support order.
Sec. 267. Reporting arrearages to credit bureaus.
Sec. 268. Liens.
Sec. 269. State law authorizing suspension of licenses.
Sec. 270. Denial of passports for nonpayment of child support.
Sec. 271. International child support enforcement.
Sec. 272. Financial institution data matches.
Sec. 273. Enforcement of orders against paternal or maternal 
                            grandparents in cases of minor parents.
Sec. 274. Nondischargeability in bankruptcy of certain debts for the 
                            support of a child.
                      Subtitle H--Medical Support

Sec. 276. Correction to ERISA definition of medical child support 
                            order.
Sec. 277. Enforcement of orders for health care coverage.
     Subtitle I--Enhancing Responsibility and Opportunity for Non-
                          Residential Parents

Sec. 281. Grants to States for access and visitation programs.
                    Subtitle J--Effect of Enactment

Sec. 291. Effective dates.
                       TITLE III--FOOD ASSISTANCE

                        Subtitle A--Food Stamps

Sec. 301. Short Title.
                      Part 1--Budgetary Proposals

Sec. 311. Include children under 22 years old in their parents' 
                            households.
Sec. 312. Use the cost of the thrifty food plan for allotment 
                            adjustments.
Sec. 313. Lower age for excluding students' earnings.
Sec. 314. Count governmental energy assistance as income.
Sec. 315. Reduce the standard deduction.
Sec. 316. Provide a State option to mandate use of standard utility 
                            allowances.
Sec. 317. Revise indexation of vehicle asset limitation.
Sec. 318. Count vendor payments for transitional housing as income.
Sec. 319. Strengthen penalties for noncompliance with work 
                            requirements.
Sec. 320. Provide a State option to require cooperation with child 
                            support enforcement agencies.
Sec. 321. Provide for disqualification for receipt of multiple food 
                            stamp benefits.
Sec. 322. Establish additional work requirement.
Sec. 323. Establish comparable treatment for disqualification.
Sec. 324. Repeal minimum benefit adjustments.
Sec. 325. Prorate benefits on recertification.
Sec. 326. Prohibit allotment increases for penalties under other 
                            welfare and public assistance programs.
Sec. 327. Permit States to determine most useful and reliable means of 
                            verification.
Sec. 328. Expand claims collection methods.
Sec. 329. Authorize States to operate simplified food stamp programs.
Sec. 330. Reauthorize appropriations for the food stamp program.
                     Part 2--Nonbudgetary Proposals

Sec. 341. Expand definition of coupon.
Sec. 342. Clarify definition of homeless individual.
Sec. 343. Provide State option for eligibility standards.
Sec. 344. Double penalties for violating food stamp program 
                            requirements.
Sec. 345. Provide State option to lower age of caretaker exemption.
Sec. 346. Revise employment and training.
Sec. 347. Disqualify fleeing felons.
Sec. 348. Encourage electronic benefit transfer systems.
Sec. 349. Authorize exchange of law enforcement information.
Sec. 350. Simplify administration of expedited service.
              Part 3--Administrative Flexibility Proposals

Sec. 361. Expand State authority to define certification period.
Sec. 362. Provide State option to combine allotments for expedited 
                            service households.
Sec. 363. Revise treatment of allotments for households residing in 
                            centers.
Sec. 364. Improve operation of food stamp offices.
Sec. 365. Delete Federal requirement for State employee training.
Sec. 366. Authorize oral withdrawal of fair hearing requests.
Sec. 367. Delete redundant Federal standards for administration.
        Part 4--Proposals for Strengthening Retailer Management

Sec. 371. Provide authority to establish authorization periods.
Sec. 372. Provide authority to requirement information for verifying 
                            eligibility for authorization.
Sec. 373. Establish waiting period for stores that initially fail to 
                            meet authorization criteria.
Sec. 374. Disqualify retailers who intentionally submit falsified 
                            applications.
Sec. 375. Disqualify retailers who are disqualified under the WIC 
                            program.
Sec. 376. Authorize suspension of stores violating program requirements 
                            pending administrative and judicial review.
Sec. 377. Expand civil and criminal forfeiture for violations of the 
                            Food Stamp Act.
Sec. 378. Expand authority for sharing information provided by retail 
                            food stores and wholesale food concerns.
           Part 5--Conforming Amendments and Effective Dates

Sec. 381. Conforming amendments.
Sec. 382. Effective dates.
                      Subtitle B--Child Nutrition

Sec. 391. Family or group day care homes.
Sec. 392. Reimbursement rate adjustments.
Sec. 393. Elimination of start-up and expansion grants.
Sec. 394. Authorization of appropriations.
Sec. 395. Direct Federal expenditures.
                     TITLE IV--TREATMENT OF ALIENS

Sec. 401. Uniform alien eligibility criteria for public assistance 
                            programs.
Sec. 402. Deeming of sponsor's income and resources to alien under TEA, 
                            SSI, and food stamp programs.
Sec. 403. Continued liability of alien and sponsor for overpayments.
Sec. 404. Requirements for sponsor's affidavit of support.
             TITLE V--SUPPLEMENTAL SECURITY INCOME REFORMS

Sec. 501. Definition and eligibility rules.
Sec. 502. Eligibility redeterminations and continuing disability 
                            reviews.
Sec. 503. Dedicated savings accounts.
Sec. 504. Denial of SSI benefits by reason of disability to drug 
                            addicts and alcoholics.
Sec. 505. Denial of SSI benefits for 10 years to individuals found to 
                            have fraudulently misrepresented residence 
                            in order to obtain benefits simultaneously 
                            in 2 or more States.
Sec. 506. Denial of SSI benefits for fugitive felons and probation and 
                            parole violators.
Sec. 507. Allowance under the discretionary spending limits for 
                            increased expenditures for continuing 
                            disability reviews and disability 
                            eligibility redeterminations.
Sec. 508. Installment payment of large past-due Supplemental Security 
                            Income benefits.
Sec. 509. Recovery of Supplemntal Security Income overpayments from 
                            Social Security benefits.
Sec. 510. Allowance under the discretionary spending limits for 
                            administrative expenses to implement 
                            changes to Supplemental Security Income 
                            program.
Sec. 511. Reduction in cash benefits payable to institutionalized 
                            individuals whose medical costs are covered 
                            by medical insurance.
                 TITLE VI--SOCIAL SERVICES BLOCK GRANTS

Sec. 601. Reduction in title XX block grants to States for social 
                            services.
    (b) References.--Except as otherwise expressly provided, wherever 
in this Act an amendment or repeal is expressed in terms of an 
amendment to, or repeal of, a section or other provision, the reference 
is considered to be made to a section or other provision of the Social 
Security Act.

                     TITLE I--WORK-BASED ASSISTANCE

SEC. 101. PURPOSE.

    The primary purpose of this title is to provide true welfare reform 
by repealing the program of Aid to Families with Dependent Children and 
replacing it with a new time-limited, conditional benefit based on 
work. Subtitle A of this title creates the Temporary Employment 
Assistance program which requires welfare recipients to work, supports 
and protects their children, and gives States broad new flexibility to 
run their welfare programs. The Work First program, established by 
subtitle C, provides the means to transform the system toward work, and 
the new consolidated child care block grant, established by subtitle B, 
contains sufficient resources to ensure that recipients who work have 
safe and adequate care for their children. This title offers the reform 
American taxpayers and welfare recipients alike want and deserve.

              Subtitle A--Temporary Employment Assistance

SEC. 102. STATE PLAN.

    Title IV (42 U.S.C. 601 et seq.) is amended by striking part A, 
except for section 415 which, consistent with section 402 of this Act, 
is redesignated as section 407, and inserting the following:

               ``PART A--TEMPORARY EMPLOYMENT ASSISTANCE

``SEC. 400. AUTHORIZATION OF APPROPRIATIONS.

    ``For the purpose of providing assistance to families with needy 
children and assisting parents of children in such families to obtain 
and retain private sector work to the extent possible, and public 
sector or volunteer work if necessary, through the Work First program 
established under parts F, G, and H, there is authorized to be 
appropriated for each fiscal year a sum sufficient to carry out the 
purposes of this part.
    ``Subpart 1--State Plans for Temporary Employment Assistance

``SEC. 401. ELEMENTS OF STATE PLANS.

    ``A State plan for temporary employment assistance shall provide a 
description of the State program which carries out the purposes 
described in section 400 and shall meet the requirements of the 
following sections of this subpart.

``SEC. 402. FAMILY ELIGIBILITY FOR TEMPORARY EMPLOYMENT ASSISTANCE.

    ``(a) In General.--The State plan shall provide that any family--
            ``(1) with 1 or more children (or any expectant family, at 
        the option of the State), defined as needy by the State; and
            ``(2) whose members have assigned their rights to support 
        to the State in accordance with section 403(b)(1)(E)(i) and 
        fulfill the conditions set forth in subsection (b), shall be 
        eligible for assistance under the plan, except as otherwise 
        provided under this part.
    ``(b) Work Requirement.--
            ``(1) Personal responsibility agreement.--The State plan 
        shall provide that not later than 30 days after the approval of 
        an application for temporary employment assistance, a parent 
        qualifying for assistance shall execute a personal 
        responsibility agreement as described in section 403. If a 
        child otherwise eligible for assistance under this part is 
        residing with a needy relative other than a parent, the State 
        plan may require the relative to execute such a plan as a 
        condition of the family receiving such assistance.
            ``(2) Work within two years.--The State plan shall provide 
        that a parent or caretaker receiving assistance under the 
        program will engage in work (as defined by the State) when the 
        State determines the parent or caretaker is ready to engage in 
        work, or after 24 months (whether or not consecutive) of 
        receiving assistance under the program, whichever is earlier.
    ``(c) Limitations on Eligibility.--
            ``(1) Requirements to work and look for work.--Except as 
        otherwise provided in paragraph (2), the State plan shall limit 
        eligibility of individuals and families as follows:
                    ``(A) Refusal to look for work.--If an unemployed 
                individual who has attained 18 years of age (or at 
                State option, 19) refuses without good cause to look 
                for work--
                            ``(i) in the case of the first such 
                        refusal, assistance shall not be payable with 
                        respect to such individual until the date the 
                        individual begins to look for work; and
                            ``(ii) in the case of a second or 
                        subsequent refusal, assistance shall not be 
                        payable with respect to the family of such 
                        individual until the later of--
                                    ``(I) 6 months after the date of 
                                such refusal; or
                                    ``(II) the date the individual 
                                begins to look for work.
                    ``(B) Refusal to accept a bona fide offer of 
                employment.--If an unemployed individual who has 
                attained 18 years of age (or at State option, 19) 
                refuses without good cause to accept a bona fide offer 
                of employment--
                            ``(i) in the case of the first such 
                        refusal, assistance shall not be payable with 
                        respect to such individual until the date the 
                        individual begins to work; and
                            ``(ii) in the case of a second or 
                        subsequent refusal, assistance shall not be 
                        payable with respect to the family of such 
                        individual until the later of--
                                    ``(I) 6 months after the date of 
                                such refusal; or
                                    ``(II) the date the individual 
                                begins to work.
                    ``(C) Failure to comply with personal 
                responsibility agreement or mutual responsibility 
                plans.--The State plan shall describe sanctions 
                determined by the State for those circumstances 
when the individual fails without good cause to comply with a personal 
responsibility agreement (or, if the State has established a program 
under subpart 1 of part F and the individual is required to participate 
in the program, a mutual responsibility plan) signed by the individual.
                            ``(i) In the case of the first such 
                        failure, the State shall impose on the 
                        individual a sanction determined by the State 
                        which is no more severe than the sanction 
                        provided for under subparagraph (A)(i).
                            ``(ii) In the case of a second or 
                        subsequent failure, the State shall impose on 
                        the family of the individual a sanction 
                        determined by the State which is no more severe 
                        than the sanction provided for under 
                        subparagraph (A)(ii).
            ``(2) Time limit on assistance.--
                    ``(A) In general.--Except as provided in 
                subparagraphs (B) and (C), the State plan shall provide 
                that the family of an individual who, after attaining 
                age 18 years (or age 19 years, at State option), has 
                received assistance under the plan for 60 months, shall 
                no longer be eligible for assistance under the plan.
                    ``(B) Hardship exception after expiration of 60-
                month period.--The State plan shall provide for 
                hardship exceptions from the application of 
                subparagraph (A) in accordance with clause (i) (or 
                alternatively, at State option, in accordance with 
                clause (ii)).
                            ``(i) General exception formulation.--
                        Except as provided in clause (ii), the State 
                        plan shall provide that eligibility shall not 
                        be denied to any family under subparagraph (A) 
                        if--
                                    ``(I) at the option of the State, 
                                the family includes an individual 
                                working 20 hours per week (or more, at 
                                the option of the State);
                                    ``(II) the family resides in an 
                                area with an unemployment rate 
                                exceeding 8 percent; or
                                    ``(III) the family is experiencing 
                                other special hardship circumstances 
                                which make it appropriate for the State 
                                to provide an exemption for such month, 
                                except that the total number of 
                                exemptions under this clause for any 
                                month shall not exceed 15 percent of 
                                the number of families to which the 
                                State is providing assistance under the 
                                plan.
                            ``(ii) Alternative hardship exception 
                        formulation.--A State may elect, as an 
                        alternative to clause (i), to define hardship 
                        circumstances, in which case the total number 
                        of exemptions under this clause for any month 
                        shall not exceed 20 percent of the number of 
                        families to which the State is providing 
                        assistance under the plan.
                    ``(C) Exclusion from 60-month period.--With respect 
                to any family, the State plan shall not include in the 
                determination of the 60-month period under subparagraph 
                (A) any month in which any of the following applies to 
                the family:
                            ``(i) Teen parents.--The parent--
                                    ``(I) is under age 18 (or age 19, 
                                at the option of the State); and
                                    ``(II) is making satisfactory 
                                progress while attending high school or 
                                an alternative technical preparation 
                                school.
                            ``(ii) Individuals exempt from work 
                        requirements.--One parent in a single-parent 
                        family or each parent in a two-parent family--
                                    ``(I) is seriously ill, 
                                incapacitated, or of advanced age;
                                    ``(II)(aa) except for a child 
                                described in subclause (bb), is 
                                responsible for a child under age 1 
                                year (or age 6 months, at the option of 
                                the State), or
                                    ``(bb) in the case of a second or 
                                subsequent child born during such 
                                period, is responsible for a child 
                                under age 3 months;
                                    ``(III) is pregnant in the 3rd 
                                trimester;
                                    ``(IV) is caring for a family 
                                member who is ill or incapacitated; or
                                    ``(V) (in the case of a single 
                                custodial parent), has a demonstrated 
                                inability to obtain needed child care, 
                                as determined by the State, for one or 
                                more of the following reasons:
                                            ``(aa) unavailability of 
                                        appropriate child care within a 
                                        reasonable distance of the 
                                        individual's home or work site;
                                            ``(bb) unavailability or 
                                        unsuitability of informal child 
                                        care by a relative or under 
                                        other arrangements; or
                                            ``(cc) unavailability of 
                                        appropriate and affordable 
                                        formal child care arrangements.
                    ``(D) Child-only cases.--With respect to any child 
                who has not attained age 18 (or age 19, at the option 
                of the State) and who is eligible for assistance under 
                this part, but not as a member of a family otherwise 
                eligible for assistance under this part (determined 
                without regard to this paragraph), the State plan shall 
                not include in the determination of the 60-month period 
                under subparagraph (A) any month in which such child 
                has not attained such age.
            ``(3) Treatment of family ineligible for cash assistance.--
        The State plan shall provide that if a family is no longer 
        eligible for cash assistance under the plan due to the 
        application of paragraph (1) or (2)--
                    ``(A) for purposes of determining eligibility for 
                any other Federal or federally assisted program based 
                on need, the family shall continue to be considered 
                eligible for such assistance;
                    ``(B) in the case of a family ineligible for such 
                assistance due solely to the application of paragraph 
                (2), the State shall, after having assessed the needs 
of the child or children of the family, provide for such needs with 
vouchers for such family--
                            ``(i) determined on the same basis as the 
                        State would provide assistance under the State 
                        plan to such a family with one less individual 
                        or two less individuals, as applicable, in the 
                        case of a two-parent family,
                            ``(ii) designed appropriately to pay third 
                        parties for shelter, goods, and services 
                        received by the child or children, and
                            ``(iii) payable directly to the third 
                        parties.
            ``(4) Individuals on old-age assistance or ssi ineligible 
        for temporary employment assistance.--The State plan shall 
        provide that no assistance shall be furnished any individual 
        under the plan with respect to any period with respect to which 
        the individual is receiving old-age assistance under the State 
        plan under title I or supplemental security income under title 
        XVI, and the individual's income and resources attributable to 
        such sources shall be disregarded in determining the 
        eligibility of the family of the individual for temporary 
        employment assistance.
            ``(5) Children for whom federal, state, or local foster 
        care maintenance or adoption assistance payments are made.--A 
        child with respect to whom foster care maintenance payments or 
        adoption assistance payments are made under part E or under 
        State or local law shall not, for the period for which such 
        payments are made, be regarded as a needy child under this 
        part, and such child's income and resources shall be 
        disregarded in determining the eligibility of the family of 
        such child for temporary employment assistance.
            ``(6) Denial of assistance for 10 years to a person found 
        to have fraudulently misrepresented residence in order to 
        obtain assistance in 2 or more states.--The State plan shall 
        provide that no assistance will be furnished any individual 
        under the plan during the 10-year period that begins on the 
        date the individual is convicted in Federal or State court of 
        having made a fraudulent statement or representation with 
        respect to the place of residence of the individual in order to 
        receive benefits or services simultaneously from 2 or more 
        States under programs that are funded under this part or title 
        XIX, or benefits in 2 or more States under the supplemental 
        security income program under title XVI.
            ``(7) Denial of assistance for fugitive felons and 
        probation and parole violators.--
                    ``(A) In general.--The State plan shall provide 
                that no assistance will be furnished any individual 
                under the plan for any period if during such period the 
                State agency has knowledge that such individual is--
                            ``(i) fleeing to avoid prosecution, or 
                        custody or confinement after conviction, under 
                        the laws of the place from which the individual 
                        flees, for a crime, or an attempt to commit a 
                        crime, which is a felony under the laws of the 
                        place from which the individual flees, or 
                        which, in the case of the State of New Jersey, 
                        is a high misdemeanor under the laws of such 
                        State; or
                            ``(ii) violating a condition of probation 
                        or parole imposed under Federal or State law.
                    ``(B) Exchange of information with law enforcement 
                agencies.--Notwithstanding any other provision of law, 
                the State plan shall provide that the State shall 
                furnish any Federal, State, or local law enforcement 
                officer, upon the request of the officer, with the 
                current address of any recipient of assistance under 
                the plan, if the officer furnishes the agency with the 
                name of the recipient and notifies the agency that--
                            ``(i) the recipient is described in clause 
                        (i) or (ii) of subparagraph (A); and
                            ``(ii) the location or apprehension of the 
                        recipient is within such officer's official 
                        duties.
    ``(d) Determination of Eligibility and Benefits.--
            ``(1) Determination of need.--The State plan shall provide 
        that the State agency will take into consideration any income 
        and resources--
                    ``(A) which are legally or actually available to 
                meet the needs of the child or relative claiming 
                temporary employment assistance; and
                    ``(B) which the State determines should be 
                considered in determining the need of such child or 
                relative.
            ``(2) Optional denial of assistance to families having 
        additional children while receiving assistance.--At the option 
        of the State, the State plan may provide that--
                    ``(A)(i) the amount of temporary employment 
                assistance paid to a family under the plan will not be 
                increased by reason of the birth of a child (other than 
                as a result of rape or incest) to an individual 
                included in such family if--
                            ``(I) when the individual is a custodial 
                        parent of a needy child, the child was 
                        conceived in a month for which the individual 
                        received aid under the plan, or
                            ``(II) when the individual is a needy 
                        child, the individual is the parent of another 
                        child who is a member of the same family and 
                        whose needs are included for purposes of making 
                        such determination;
                    ``(ii) if the value of assistance to a family under 
                the State plan approved under this part is reduced by 
                reason of subclause (I), each member of the family 
                shall be considered to be receiving such assistance for 
                purposes of Federal law including but not limited to 
                eligibility for medical assistance under the State plan 
                approved under title XIX for so long as assistance to 
                the family under the State plan approved under this 
                part would otherwise not be so reduced; and
                    ``(B) if the State exercises the option, the State 
                may provide the family with vouchers, in amounts not 
                exceeding the amount of any such reduction in 
                assistance, that may be used only to pay for particular 
                goods and services specified by the State as suitable 
                for the care of the child of the parent (such as 
                diapers, clothing, or school supplies). In addition, 
                the State may allow an additional earned income 
                disregard, or disregard of child support received on 
                behalf of a child described by this subsection, in 
                amounts that do not exceed in total the reduction in 
                assistance that occurs as a result of a State 
                exercising the option.
                    ``(C) A family may be subjected to this 
                subparagraph as long as application of this 
                subparagraph, whether alone or together with other 
                provisions of the State plan, does not reduce to zero 
                the maximum assistance level for such a family.
            ``(3) Resource and income determination.--With respect to 
        the determination of the total resources and income of the 
        family of any needy child, the State plan shall provide the 
        following:
                    ``(A) Resources.--The plan shall specify the 
                resource limit, and describe the policy determined by 
                the State regarding any exclusion allowed for vehicles 
                owned by family members, resources set aside for future 
                needs of a child, individual development accounts, or 
                other policies established by the State to encourage 
                savings.
                    ``(B) Family income.--The plan shall specify the 
                extent to which earned or unearned income is 
                disregarded in determining eligibility for, and amount 
                of, assistance.
                    ``(C) Child support.--The plan shall specify 
                whether (and if so, the extent to which) current child 
                support received in excess of $50 per month on behalf 
                of a member of the family is disregarded in determining 
                eligibility for, and the amount of, assistance.
                    ``(D) Child's earnings.--The plan shall describe 
                the treatment of earnings of a child living in the 
                home.
                    ``(E) Earned income tax credit.--The plan shall 
                provide for disregard of any refund of Federal income 
                taxes made to a family receiving temporary employment 
                assistance by reason of section 32 of the Internal 
                Revenue Code of 1986 (relating to earned income tax 
                credit) and any payment made to such a family by an 
                employer under section 3507 of such Code (relating to 
                advance payment of earned income credit).
            ``(4) Verification system.--The State plan shall provide 
        that information is requested and exchanged for purposes of 
        income and eligibility verification in accordance with a State 
        system which meets the requirements of section 1137.
    ``(e) Services to Native Americans.--The State plan shall specify 
the steps that will be taken to ensure that an appropriate share of 
assistance and services under the plan (and under part F and part G or 
H) are furnished to eligible Native Americans (including, as 
applicable, Indians, Alaskan Natives, and Native Hawaiians) living in 
the State.
    ``(f) Services to Refugees.--The State plan shall provide 
assurances that assistance and services furnished to refugees under the 
plan (and under part F and part G or H) shall be furnished in a manner 
that promotes their economic self-sufficiency and adjustment.

``SEC. 403. PERSONAL RESPONSIBILITY AGREEMENT.

    ``(a) Assessment.--The State agency responsible for administering 
the State plan shall make an initial assessment of the skills, prior 
work experience, and employability of each caretaker who applies for, 
or receives assistance under the State plan who--
            ``(1) has attained 18 years of age (or at State option, 
        19); or
            ``(2) has not attained the age specified in paragraph (1), 
        has not completed high school or obtained a certificate of high 
        school equivalency, and is not attending secondary school.
    ``(b) Personal Responsibility Agreements.--
            ``(1) In general.--On the basis of the assessment made 
        under subsection (a) with respect to an individual, the State 
        agency, in consultation with the individual, shall develop an 
        appropriate personal responsibility agreement for the 
        individual, which--
                    ``(A) provides that participation by the individual 
                in job search activities is a condition of eligibility 
                for assistance under the State plan approved under part 
                A, except during any period for which the individual is 
                employed full-time in an unsubsidized job;
                    ``(B) sets forth an employment goal for the 
                individual and a plan for moving the individual 
                immediately into private sector employment;
                    ``(C) sets forth the obligations of the individual, 
                which may include a requirement that the individual 
                attend school, maintain certain grades and attendance, 
                keep school age children of the individual in school, 
                immunize children, attend parenting and money 
                management classes, or do other things that will help 
                the individual become and remain employed in the 
                private sector;
                    ``(D) may require that the individual enter the 
                State program established under part F, if the 
                caseworker determines that the individual will need 
                education, training, job placement assistance, wage 
                enhancement, or other services to become employed in 
                the private sector;
                    ``(E) provides that the individual must--
                            ``(i) assign to the State any rights to 
                        support (including, but not limited to, amounts 
                        which have accrued at the time such assignment 
                        is executed) from any other person the 
                        individual may have in such individual's own 
                        behalf or in behalf of any other family member 
                        for whom the individual is applying for or 
receiving assistance or any other family member who is deemed to be 
receiving assistance for the purposes of title XIX; provided that the 
assignment of arrearages that accrued in a month in which the family 
did not receive assistance under this part shall cease to be effective 
for any family no longer receiving assistance under this part to which 
the State applies the amendments made by the Work First and Personal 
Responsibility Act of 1996 to section 457(c); and
                            ``(ii) cooperate with the State--
                                    ``(I) in establishing the paternity 
                                of a child born out of wedlock with 
                                respect to whom assistance is claimed, 
                                and
                                    ``(II) in obtaining support 
                                payments for the individual and for a 
                                child with respect to whom such 
                                assistance is claimed, or in obtaining 
                                any other payments or property due the 
                                individual or the child, unless (in 
                                either case) the individual is found to 
                                have good cause for refusing to 
                                cooperate as determined by the State 
                                agency administering the program under 
                                part D in accordance with standards 
                                prescribed by the Secretary, which 
                                standards shall take into consideration 
                                the best interests of the child on 
                                whose behalf assistance is claimed.
                    ``(F) to the greatest extent possible is designed 
                to move the individual into whatever private sector 
                employment the individual is capable of handling as 
                quickly as possible, and to increase the responsibility 
                and amount of work the individual is to handle over 
                time;
                    ``(G) describes the services the State will provide 
                the individual so that the individual can obtain and 
                keep employment in the private sector, and describes 
                the job counseling and other services that will be 
                provided by the State; and
                    ``(H) at the option of the State, may require the 
                individual to undergo appropriate substance abuse 
                treatment.
            ``(2) Timing.--The State agency shall comply with paragraph 
        (1) with respect to an individual--
                    ``(A) within 180 days after the effective date of 
                this part, in the case of an individual who, as of such 
                effective date, is a recipient of assistance under the 
                State plan approved under this part; or
                    ``(B) within 90 days after the individual is 
                determined to be eligible for such assistance, in the 
                case of any other individual.
    ``(c) Provision of Program and Employment Information.--The State 
shall inform all applicants for and recipients of assistance under the 
State plan approved under this part of all available services under the 
State plan for which they are eligible.
    ``(d) Requirement That Recipients Enter the Work First Program.--
            ``(1) In general.--On and after October 1, 2003, the State 
        shall place recipients of assistance under the State plan under 
        this part, who have not become employed within 1 year after 
        signing an personal responsibility agreement, in the first 
        available slot in the State program under part F, except as 
        provided in paragraph (2).
            ``(2) Exceptions.--A state shall not require a recipient of 
        such assistance to participate in the program if the 
        recipient--
                    ``(A) is ill, incapacitated, or of advanced age;
                    ``(B) except for a child described in subparagraph 
                (C), is responsible for a child under age 1 year (or 
                age 6 months, at the option of the State);
                    ``(C) in the case of a second or subsequent child 
                born since the recipient signed the agreement, is 
                responsible for a child under age 3 months;
                    ``(D) is pregnant in the third trimester;
                    ``(E) is caring for a family member who is ill or 
                incapacitated; or
                    ``(F) is a single custodial parent and has a 
                demonstrated inability to obtain needed child care, as 
                determined by the State, for one or more of the 
                following reasons:
                            ``(i) unavailability of appropriate child 
                        care within a reasonable distance of the 
                        individual's home or work site;
                            ``(ii) unavailability or unsuitability of 
                        informal child care by a relative or under 
                        other arrangements; or
                            ``(iii) unavailability of appropriate and 
                        affordable formal child care arrangements.

``SEC. 404. PAYMENT OF ASSISTANCE.

    ``(a) Standards of Assistance.--The State plan shall specify 
standards of assistance, including--
            ``(1) the composition of the family unit for which 
        assistance will be provided;
            ``(2) a standard or standards, expressed in a dollar amount 
        or amounts, to be used in determining the need of applicants 
        and recipients;
            ``(3) a standard or standards, expressed in a dollar amount 
        or amounts, to be used in determining the amount of the 
        assistance payment; and
            ``(4) the methodology to be used in determining the payment 
        amount received by an assistance unit.
    ``(b) Level of Assistance.--Except as otherwise provided in this 
title, the State plan shall provide that--
            ``(1) the determination of need and the amount of 
        assistance for all applicants and recipients shall be made on 
        an objective and equitable basis; and
            ``(2) families of similar composition with similar needs 
        and circumstances shall be treated similarly.
    ``(c) Fair Hearing and Correction of Payments.--The State plan 
shall provide that the State agency shall--
            ``(1) grant an opportunity for a fair hearing before the 
        State agency to any individual whose request for assistance 
        under such plan is denied or is not acted upon with reasonable 
        promptness; and
            ``(2) promptly take all necessary steps to correct any 
        overpayment or underpayment of assistance under such plan, 
        including the request for withholding from Federal tax refunds 
        as provided under section 416.
    ``(d) Optional Voluntary Diversion Program.--
            ``(1) In general.--Subject to paragraphs (2) and (3), the 
        State plan may provide, with respect to the geographic area or 
        areas of the State that the State may select, that upon the 
        recommendation of the caseworker responsible, the State may 
        offer to an eligible family one-time assistance for a period of 
        not more than three months (which assistance, if accepted by 
        the family, shall be in lieu of any other assistance under the 
        State plan for such period) in an amount not to exceed--
                    ``(A) the value of the monthly benefits that would 
                otherwise be provided to the family under the State 
                plan; multiplied by
                    ``(B) the number of months in the time period.
            ``(2) One-time limitation.--Assistance pursuant to 
        paragraph (1) shall not be made more than once to any family; 
        and
            ``(3) Adjustment of alternative benefits.--If, during the 
        period with respect to which the State has provided one-time 
        assistance to a family pursuant to paragraph (1), the family 
        applies for and (but for the one-time assistance) would be 
        eligible under the State plan for a monthly benefit greater 
        than the value of the amount used in the calculation under 
        paragraph (1), then, notwithstanding paragraph (1), the State 
        shall, for that part of the time period that remains after the 
        family becomes eligible for the greater monthly benefit, 
        provide monthly benefits to the family in an amount not to 
        exceed--
                    ``(A) the amount by which the value of the greater 
                monthly benefit exceeds the value of the former monthly 
                benefit, multiplied by the number of months in the time 
                period; divided by
                    ``(B) the whole number of months remaining in the 
                time period.

``SEC. 405. REQUIREMENTS CONCERNING OTHER PROGRAMS.

    ``(a) Work First Program; Workfare or Job Placement Voucher 
Program.--The State plan shall provide that the State has in effect--
            ``(1) a Work First program that meets the requirements of 
        part F; and
             ``(2) a workfare program that meets the requirements of 
        part G, or a job placement voucher program that meets the 
        requirements of part H, but not both.
    ``(b) Provision of Case Management Services.--The State plan shall 
provide that the State shall furnish to participants in those programs 
case management services that are necessary to ensure the integrated 
provision of benefits and services under those programs and under this 
part.
    ``(c) State Child Support Agency.--The State plan shall--
            ``(1) provide that the State has in effect a plan approved 
        under part D and operates a child support program in 
        substantial compliance with such plan;
            ``(2) provide that the State agency administering the plan 
        approved under this part is responsible for ensuring that--
                    ``(A) the benefits and services provided under 
                plans under this part and part D are furnished in an 
                integrated manner, including coordination of intake 
                procedures with the agency administering the plan under 
                part D;
                    ``(B) all applicants for, and recipients of, 
                temporary employment assistance are encouraged, 
                assisted, and required (as provided under section 
                403(b)(1)(E)(ii)) to cooperate in the establishment and 
                enforcement of paternity and child support obligations 
                and are notified about the services available under the 
                State plan approved under part D; and
                    ``(C) procedures require referral of paternity and 
                child support enforcement cases to the agency 
                administering the plan approved under part D not later 
                than 10 days after the application for temporary 
                employment assistance; and
            ``(3) provide for prompt notice (including the transmittal 
        of all relevant information) to the State child support 
        collection agency established pursuant to part D of the 
        furnishing of temporary employment assistance with respect to a 
        child who has been deserted or abandoned by a parent (including 
        a child born out of wedlock, without regard to whether the 
        paternity of the child has been established).
    ``(d) Child Welfare Services and Foster Care and Adoption 
Assistance.--The State plan shall provide that the State has in 
effect--
            ``(1) a State plan for child welfare services approved 
        under part B; and
            ``(2) a State plan for foster care and adoption assistance 
        approved under part E,
and operates such plans in substantial compliance with the requirements 
of such parts.
    ``(e) Report of Child Abuse, etc.--The State plan shall provide 
that the State agency will--
            ``(1) report to an appropriate agency or official known or 
        suspected instances of physical or mental injury, sexual abuse 
        or exploitation, or negligent treatment or maltreatment of a 
        child receiving assistance under the State plan under 
        circumstances which indicate that the child's health or welfare 
        is threatened thereby; and
            ``(2) provide such information with respect to a situation 
        described in paragraph (1) as the State agency may have.
    ``(f) Availability of Assistance in Rural Areas of State.--The 
State plan shall provide that the State agency shall consider and 
address any special needs of rural areas in the State to ensure that 
families in such areas receive assistance to become self-sufficient.
    ``(g) Family Preservation.--
            ``(1) In general.--The State plan shall describe the 
        efforts by the State to promote family preservation and 
        stability, including efforts--
                    ``(A) to encourage fathers to stay home and be a 
                part of the family;
                    ``(B) to keep families together to the extent 
                possible; and
                    ``(C) except to the extent provided in paragraph 
                (2), to treat 2-parent families and 1-parent families 
                equally with respect to eligibility for assistance.
            ``(2) Maintenance of treatment.--The State may impose 
        eligibility limitations relating specifically to 2-parent 
        families to the extent such limitations are no more restrictive 
        than such limitations in effect in the State plan in fiscal 
        year 1995.
    ``(h) Child Care.--The State plan shall provide that the State has 
in effect a plan under its program under the Child Care Development 
Block Grant Act of 1990.

``SEC. 406. ADMINISTRATIVE REQUIREMENTS FOR STATE PLAN.

    ``(a) Statewide Plan.--The State plan shall be in effect in all 
political subdivisions of the State, and, if administered by the 
subdivisions, be mandatory upon such subdivisions. If such plan is not 
administered uniformly throughout the State, the plan shall describe 
the administrative variations.
    ``(b) Single Administering Agency.--The State plan shall provide 
for the establishment or designation of a single State agency to 
administer the plan or supervise the administration of the plan.
    ``(c) Financial Participation.--The State plan shall provide for 
financial participation by the State consistent with section 413.
    ``(d) Reasonable Promptness.--The State plan shall provide that all 
individuals wishing to apply for temporary employment assistance shall 
have opportunity to do so, and that such assistance shall be furnished 
with reasonable promptness to all eligible individuals.
    ``(e) Automated Data Processing System.--The State plan may provide 
for the establishment and operation of an automated statewide 
management information system designed effectively and efficiently to 
assist management in the administration of the State plan approved 
under this part, so as--
            ``(1) to control and account for--
                    ``(A) all the factors in the total eligibility 
                determination process under such plan for assistance, 
                and
                    ``(B) the costs, quality, and delivery of payments 
                and services furnished to applicants for and recipients 
                of assistance; and
            ``(2) to notify the appropriate officials for child 
        support, food stamp, and social service programs, and the 
        medical assistance program approved under title XIX, whenever a 
        recipient becomes ineligible for such assistance or the amount 
        of assistance provided to a recipient under the State plan is 
        changed.
    ``(f) Disclosure of Information.--The State plan shall provide for 
safeguards which restrict the use or disclosure of information 
concerning applicants or recipients.
    ``(g) Detection of Fraud.--The State plan shall provide, in 
accordance with regulations issued by the Secretary, for appropriate 
measures to detect fraudulent applications for temporary employment 
assistance before the establishment of eligibility for such assistance.
    ``(h) Audits.--
            ``(1) In general.--Each State shall audit, not less than 
        annually, the State expenditures for the program under this 
        part and parts F, G, and H to determine the extent to which the 
        expenditures were made in accordance with the provisions of 
        this part and parts F, G, and H.
            ``(2) Audit reports.--Not later than 30 days following the 
        completion of an audit under this subsection, a State shall 
        submit a copy of the audit to the State legislature and to the 
        Secretary of Health and Human Services.
            ``(3) Single audits.--To the extent they are not 
        inconsistent with this section, the provisions of chapter 75 of 
        title 31, United States Code, apply to audit requirements of 
        this section.

                 ``Subpart 2--Administrative Provisions

``SEC. 411. APPROVAL OF PLAN.

    ``(a) In General.--The Secretary shall approve a State plan which 
fulfills the requirements under subpart 1 within 120 days of the 
submission of the plan by the State to the Secretary.
    ``(b) Deemed Approval.--If a State plan has not been rejected by 
the Secretary during the period specified in subsection (a), the plan 
is considered to have been approved.

``SEC. 412. COMPLIANCE.

    ``In the case of any State plan for temporary employment assistance 
which has been approved under section 411, if the Secretary, after 
reasonable notice and opportunity for hearing to the State agency 
administering or supervising the administration of such plan, finds 
that in the administration of the plan there is a failure to comply 
substantially with any provision required by subpart 1 to be included 
in the plan, the Secretary shall notify such State agency that further 
payments will not be made to the State (or in the Secretary's 
discretion, that payments will be limited to categories under or parts 
of the State plan not affected by such failure) until the Secretary is 
satisfied that there is no longer any such failure to comply. Until the 
Secretary is so satisfied the Secretary shall make no further payments 
to such State (or shall limit payments to categories under or parts of 
the State plan not affected by such failure).

``SEC. 413. PAYMENTS TO STATES.

    ``(a) Computation of Amount.--
            ``(1) In general.--Subject to section 412, the Secretary of 
        the Treasury shall pay to each State which has an approved plan 
        for temporary employment assistance, for each quarter, 
        beginning with the quarter commencing October 1, 1996, an 
        amount equal to the Federal medical assistance percentage (as 
        defined in section 1905(b) or, as applicable, in section 1118) 
        of the program expenditures by the State under that plan (other 
        than expenditures for administrative costs of that plan and for 
        purposes specified in paragraph (2)(B)).
            ``(2) Work first and other programs.--
                    ``(A) Entitlement; federal matching share.--Each 
                State that is operating a program in accordance with a 
                plan approved under part F and a program in accordance 
                with part G or H shall be entitled to payment, for each 
                fiscal year, equal to the lesser of--
                            ``(i) the sum of the amounts allotted to 
                        the State pursuant to subparagraphs (D) and 
                        (E), or
                            ``(ii) the greater of 60 percent or the 
                        Federal medical assistance percentage (as 
                        defined in section 1905(b) or, as applicable, 
                        in section 1118) of State expenditures for the 
                        purposes specified in subparagraph (B) 
                        (excluding any expenditures from performance 
                        bonuses provided under paragraph (4)).
                    ``(B) Use of funds.--
                            ``(i) Amounts available to a State pursuant 
                        to this paragraph may be used by the State--
                                    ``(I) for all costs of carrying out 
                                programs under part F and part G or 
                                part H;
                                    ``(II) for administrative costs of 
                                carrying out the program under part A;
                                    ``(III) for all costs of providing 
                                emergency assistance to needy families 
                                with children in accordance with 
                                paragraph (3); and
                                    ``(IV) to supplement amounts 
                                otherwise available for child care 
                                under section 6580b of the Child Care 
                                and Development Block Grant Act of 
                                1990, subject to the terms and 
                                conditions, including matching 
                                requirements, under section 6580b of 
                                that Act.
                            ``(ii) States shall not allocate to 
                        programs in which Federal financial 
                        participation is available, other than programs 
                        specified in clause (i), administrative costs 
                        for activities in fiscal year 1997 and 
                        succeeding fiscal years that in fiscal year 
                        1995 were allocated to programs under parts A 
                        and F.
                    ``(C) Amounts for allotment.--For purposes of 
                allotment to States under subparagraphs (D) and (E), 
                the amount specified in this subparagraph is as 
                follows:
                            ``(i) For fiscal years 1997 through 2002, 
                        the amount specified is:
                                    ``(I) $2,900,000,000 for fiscal 
                                year 1997;
                                    ``(II) $2,950,000,000 for fiscal 
                                year 1998;
                                    ``(III) $3,100,000,000 for fiscal 
                                year 1999;
                                    ``(IV) $3,350,000,000 for fiscal 
                                year 2000;
                                     ``(V) $3,800,000,000 for fiscal 
                                year 2001;
                                     ``(VI) $3,900,000,000 for fiscal 
                                year 2002;
                            ``(ii) For fiscal year 2003 and each 
                        succeeding fiscal year, the amount specified is 
                        the product of the following:
                                    ``(I) The amount specified in this 
                                subparagraph for the immediately 
                                preceding fiscal year.
                                    ``(II) 1.00 plus the percentage (if 
                                any) by which the average of the 
                                Consumer Price Index (as defined in 
                                section 1(f)(5) of the Internal Revenue 
                                Code of 1986) for the most recent 12-
                                month period for which such information 
                                is available exceeds that for the 
                                previous 12-month period.
                                    ``(III) 1.00 plus the percentage 
                                change (if any) in the participation 
                                rate required in section 488.
                                    ``(IV) 1.00 plus the percentage 
                                change in the non-exempt adult 
                                recipient caseload for the most recent 
                                quarter for which information is 
                                available, compared to that caseload 
                                for the same calendar quarter in the 
                                previous year.
                    ``(D) Base allotment to states.--From the amount 
                specified in subparagraph (C) for a fiscal year, the 
                Secretary shall first allot to each eligible State an 
                amount equal to the amount paid to the State pursuant 
                to section 403(a)(3) for administration of the State 
                program under part A in fiscal year 1995.
                    ``(E) Allotment of remainder to states.--
                            ``(i) From the amount specified in 
                        subparagraph (C) for a fiscal year remaining 
                        after application of subparagraph (D), the 
                        Secretary shall allot to each State an amount 
                        bearing the same ratio to such remainder as the 
                        average monthly number of non-exempt adult 
                        recipients (as defined in clause (ii)) in the 
                        State in the preceding fiscal year bears to the 
                        average monthly number of such recipients in 
                        all eligible States for such preceding year.
                            ``(ii) For purposes of this subparagraph, 
                        the term `non-exempt adult recipient' in the 
                        case of any State means an individual other 
                        than a dependent child (unless such child is 
                        the custodial parent of another dependent 
                        child)--
                                    ``(I) whose needs are met (in whole 
                                or in part) with assistance provided 
                                under the State plan approved under 
                                this part, and
                                    ``(II) who is required to 
                                participate in a program under part F, 
                                G, or H.
                            ``(iii) For purposes of clause (ii), the 
                        term `dependent child' means a needy child--
                                    ``(I) who has been deprived of 
                                parental support or care by reason of 
                                the death, continued absence from the 
                                home (other than absence occasioned 
                                solely by reason of the performance of 
                                active duty in the uniformed services 
                                of the United States), or physical or 
                                mental incapacity of a parent, and who 
                                is living with his father, mother, 
                                grandfather, grandmother, brother, 
                                sister, stepfather, stepmother, 
                                stepbrother, stepsister, uncle, aunt, 
                                first cousin, nephew, or niece, in a 
                                place of residence maintained by one or 
                                more of such relatives as the 
                                relative's own home, and
                                    ``(II) who is--
                                            ``(aa) under the age of 
                                        eighteen, or
                                            ``(bb) at the option of the 
                                        State, under the age of 
                                        nineteen and a full-time 
                                        student in a secondary school 
                                        (or in the equivalent level of 
                                        vocational or technical 
                                        training), if, before age 
                                        nineteen, the child reasonably 
                                        may be expected to complete the 
                                        secondary school program (or 
                                        training).
                            ``(iv) For purposes of clause (iii), the 
                        term `relative with whom any dependent child is 
                        living' means the individual who is one of the 
                        relatives specified in clause (iii) and with 
                        whom the child is living (within the meaning of 
                        such subsection) in a place of residence 
                        maintained by the individual (alone or together 
                        with any one or more of the other relatives so 
                        specified) as the relative's own home.
                    ``(F) Amounts for ineligible participants.--Not 
                more than 10 percent of the amount payable to a State 
                under this paragraph for a calendar quarter may be for 
                expenditures made during the quarter with respect to 
                program participants who are not eligible for 
                assistance under the State plan approved under this 
                part.
            ``(3) Emergency assistance.--
                    ``(A) For purposes of paragraph (2)(B)(i)(III), the 
                term `emergency assistance to needy families with 
                children' means any of the items specified in 
                subparagraph (B), furnished for a period not in excess 
                of 30 days in any 12-month period, in the case of a 
                needy child under the age of 21 who is (or, within such 
                period as may be specified by the Secretary, has been) 
                living with any of the relatives specified in paragraph 
                (2)(E)(iii) in a place of residence maintained by one 
                or more of such relatives as the relative's own home, 
                but only where--
                             ``(i) such child is without available 
                        resources,
                            ``(ii) the payments, care, or services 
                        involved are necessary to avoid destitution of 
                        such child or to provide living arrangements in 
                        a home for such child, and
                            ``(iii) the destitution or need for living 
                        arrangements did not arise because the child or 
                        relative refused without good cause to accept 
                        employment or training for employment.
                    ``(B) For the purposes of subparagraph (A), the 
                items specified include--
                            ``(i) money payments, payments in kind, or 
                        such other payments as the State agency may 
                        specify with respect to, or medical care or any 
                        other type of remedial care recognized under 
                        State law (for which the individual is not 
                        entitled to medical assistance under the State 
                        plan under title XIX) on behalf of, such child 
                        or any other member of the household in which 
                        he is living, and
                            ``(ii) services the Secretary may specify,
                but the term does not include benefits or services 
                provided to children in the juvenile justice system.
            ``(4) Performance bonus.--
                    ``(A) In general.--The Secretary, in consultation 
                with State and local government officials and other 
                interested persons, shall develop a system of 
                performance measures and performance bonuses that 
                rewards States that operate programs established under 
                parts F, G, and H that are effective in moving 
                recipients of assistance under the State plan approved 
                under this part into employment.
                    ``(B) Allocation formula.--
                            ``(i) In general.--Not later than January 
                        1, 1997, the Secretary, in consultation with 
                        State and local government officials and other 
                        interested persons, shall develop and publish 
                        in the Federal Register a formula for 
                        allocating the limitation amount specified in 
                        subparagraph (E) for the performance bonus fund 
                        for a fiscal year, based on the effectiveness 
                        of State programs established under parts F, G, 
                        and H in moving recipients of assistance under 
                        the State plan under this part into employment 
                        in the preceding fiscal year, including those 
                        who remain employed for greater periods of 
                        time. In each fiscal year specified in 
                        subparagraph (E), a State shall be entitled to 
                        receive payments equal to the limitation 
                        allocated to such State under the formula 
                        developed by the Secretary under this clause.
                            ``(ii) Factors to be considered.--In 
                        developing the allocation formula under clause 
                        (i), the Secretary shall take into 
                        consideration factors that affect a State's 
                        ability to achieve a given level of employment 
                        of recipients, such as--
                                    ``(I) the proportion of families 
                                who are at greatest risk of long-term 
                                welfare dependency, or who have 
                                remained unemployed for long periods of 
                                time; and
                                    ``(II) the unemployment conditions 
                                of each State.
                    ``(C) Annual compliance reports.--Each State shall 
                submit to the Secretary annual reports on the 
                effectiveness of its program under part F based on the 
                performance measures established under subparagraph 
                (A).
                    ``(D) Use of payments.--Bonus payments under this 
                paragraph shall be used for the purposes allowable 
                under subsection (a)(2)(B)(i).
                    ``(E) Limitation amount specified.--For purposes of 
                the allocation formula under subparagraph (B), the 
                limitation amount specified in this subparagraph is--
                            ``(i) $100,000,000 for fiscal year 1997 
                        rates, payable in FY 1998;
                            ``(ii) $100,000,000 for fiscal year 1998 
                        rates, payable in FY 1999;
                            ``(iii) $200,000,000 for fiscal year 1999 
                        rates, payable in FY 2000;
                            ``(iv) $200,000,000 for fiscal year 2000 
                        rates, payable in FY 2001; and
                            ``(v) $200,000,000 for fiscal year 2001 
                        rates, payable in FY 2002.
    ``(b) Method of Computation and Payment.--The method of computing 
and paying amounts pursuant to this section is as follows:
            ``(1) The Secretary, prior to the beginning of each 
        quarter, shall estimate the amount to be paid to the State for 
        the quarter under subsection (a), the estimate to be based on--
                    ``(A) a report filed by the State containing its 
                estimate of the amount to be expended in the quarter in 
                accordance with each provision of subsection (a) and 
                stating the amounts appropriated or made available by 
                the State and its political subdivisions for such 
                expenditures in the quarter, and if the sum of those 
                amounts is less than the State's proportionate share of 
                the total sum of such estimated expenditures, the 
                source or sources from which the difference is expected 
                to be derived;
                    ``(B) records showing the number of needy children 
                in the State; and
                    ``(C) such other information as the Secretary may 
                find necessary.
            ``(2) The Secretary of Health and Human Services shall then 
        certify to the Secretary of the Treasury the amount so 
        estimated--
                    ``(A) reduced or increased, as the case may be, by 
                any sum by which the Secretary of Health and Human 
                Services finds that the estimate for any prior quarter 
                was greater or less than the amount which should have 
                been paid to the State for such quarter;
                    ``(B) reduced by a sum equivalent to the pro rata 
                share to which the Federal Government is equitably 
                entitled, as determined by the Secretary of Health and 
                Human Services, of the net amount recovered during any 
                prior quarter by the State or any political subdivision 
                thereof with respect to temporary employment assistance 
                furnished under the State plan; and
                    ``(C) reduced by such amount as is necessary to 
                provide the appropriate reimbursement to the Federal 
                Government that the State is required to make under 
                section 457 out of that portion of child support 
                collections retained by the State pursuant to such 
                section, except that such increases or reductions shall 
                not be made to the extent that such sums have been 
                applied to make the amount certified for any prior 
                quarter greater or less than the amount estimated by 
                the Secretary of Health and Human Services for such 
                prior quarter.
    ``(c) Method of Payment.--The Secretary of the Treasury, through 
the Fiscal Service of the Department of the Treasury and prior to audit 
or settlement by the General Accounting Office, shall pay to the State, 
at the time or times fixed by the Secretary of Health and Human 
Services, the amount so certified.

``SEC. 414. QUALITY ASSURANCE, DATA COLLECTION, AND REPORTING SYSTEM.

    ``(a) Quality Assurance.--
            ``(1) In general.--In order--
                    ``(A) to improve the accuracy of payments of 
                temporary employment assistance and wages under work 
                programs under parts F, G, and H, to assess the 
                accuracy of data reported by each State relating to its 
                work programs and to its implementation of the time 
                limits established by section 402(c)(2),
                    ``(B) to determine whether participation standards 
                under section 488(a) have been met,
                    ``(C) to assess the effectiveness of the State's 
                program by applying the performance standards developed 
                under section 413(a)(4), and
                    ``(D) to serve such other purposes as the Secretary 
                finds appropriate for a performance measurement system, 
                the Secretary shall establish and operate a quality 
                assurance system to secure the accurate data needed to 
                measure performance, identify areas in which corrective 
                action is necessary, and determine the amount (if any) 
                of the disallowance required to be repaid to the 
                Secretary because of erroneous aid payments made by the 
                State. A quality assurance system shall be developed 
                based upon a collaborative effort involving the 
                Secretary, the States and other interested parties, and 
                shall include quantifiable program outcomes related to 
                self sufficiency in the categories of welfare-to-work, 
                payment accuracy, and child support.
            ``(2) Modifications to system.--As considered necessary, 
        but not more often than every 2 years, the Secretary, in 
        consultation with the States and other interested parties, 
        shall make appropriate changes in the design and administration 
        of the quality assurance system, including changes in 
benchmarks, measures, and data collection or sampling procedures.
    ``(b) Data Collection and Reporting.--
            ``(1) In general.--The State plan shall provide for a 
        quarterly report to the Secretary regarding the data described 
        in paragraphs (2) and (3) and such additional data as the 
        Secretary determines is needed for the quality assurance 
        system. The data collection and reporting system under this 
        subsection shall promote accountability, continuous 
        improvement, and integrity in the State programs for temporary 
        employment assistance and Work First.
            ``(2) Disaggregated data.--The State shall collect the 
        following data items on a monthly basis from disaggregated case 
        records of applicants for and recipients of temporary 
        employment assistance from the previous month:
                    ``(A) The age of adults and children (including 
                pregnant women).
                    ``(B) Marital or familial status of cases: married 
                (2-parent family), widowed, divorced, separated, or 
                never married; or child living with other adult 
                relative.
                    ``(C) The gender, race, educational attainment, 
                work experience, disability status (whether the 
                individual is seriously ill, incapacitated, or caring 
                for a disabled or incapacitated child) of adults.
                    ``(D) The amount of cash assistance and the amount 
                and reason for any reduction in such assistance. Any 
                other data necessary to determine the timeliness and 
                accuracy of benefits and welfare diversions.
                    ``(E) Whether any member of the family receives 
                benefits under any of the following:
                            ``(i) Any housing program.
                            ``(ii) The program under the Food Stamp Act 
                        of 1977.
                            ``(iii) The program under the Head Start 
                        Act.
                            ``(iv) Any job training program.
                    ``(F) The number of months since the most recent 
                application for assistance under the plan.
                    ``(G) The total number of months for which 
                assistance has been provided to the families under the 
                plan.
                    ``(H) The employment status, hours worked, and 
                earnings of individuals while receiving assistance, 
                whether the case was closed due to employment, and 
                other data needed to determine the work performance 
                rate.
                    ``(I) Status in Work First and workfare, including 
                the number of hours an individual participated and the 
                component in which the individual participated.
                    ``(J) The number of individuals in the assistance 
                unit and their relationship to the youngest child. 
                Nonrecipients in the household and the relationship of 
                each to the youngest child.
                    ``(K) Citizenship status.
                    ``(L) Shelter arrangement.
                    ``(M) Unearned income (not including temporary 
                employment assistance), such as child support, and 
                assets.
                    ``(N) The number of children who have a parent who 
                is deceased, incapacitated, or unemployed.
                    ``(O) Geographic location.
            ``(3) Aggregated data.--The State shall collect the 
        following data items on a monthly basis from aggregated case 
        records of applicants for and recipients of temporary 
        employment assistance from the previous month:
                    ``(A) The number of adults receiving assistance.
                    ``(B) The number of children receiving assistance.
                    ``(C) The number of families receiving assistance.
                    ``(D) The number of assistance units who had grants 
                reduced or terminated and the reason for the reduction 
                or termination, including sanction, employment, and 
                exceeding the time limit for assistance.
                    ``(E) The number of applications for assistance; 
                the number approved and the number denied and the 
                reason for denial.
            ``(4) Longitudinal studies.--The State shall submit 
        selected data items for a cohort of individuals who are tracked 
        over time. This longitudinal sample shall be used for selected 
        data items described in paragraphs (2) and (3), as determined 
        appropriate by the Secretary.
    ``(c) Additional Data.--The report required by subsection (b) for a 
fiscal year quarter also shall include the following:
            ``(1) Report on use of federal funds to cover 
        administrative costs and overhead.--A statement of--
                    ``(A) the percentage of the Federal funds paid to 
                the State under Section 413 for the fiscal year quarter 
                and used to carry out parts F and G or H that are used 
                to cover administrative costs or overhead; and
                    ``(B) the total amount of State funds that are used 
                to cover such costs or overhead.
            ``(2) Report on state expenditures on programs for needy 
        families.--A statement of the total amount expended by the 
        State during the fiscal year quarter on programs for needy 
        families, with the amount spent on the program under this part, 
        and the purposes for which such amount was spent, separately 
        stated.
            ``(3) Report on noncustodial parents participating in work 
        activities.--The number of noncustodial parents in the State 
        who participated in work activities during the fiscal year 
        quarter.
            ``(4) Report on child support collected.--The total amount 
        of child support collected by the State agency administering 
        the State plan under part D on behalf of a family receiving 
        assistance under this part.
            ``(5) Report on transitional services.--The total amount 
        expended by the State for providing transitional services to 
        families that have ceased to receive assistance under this part 
because of increased hours of, or increased income from, employment, 
together with a description of such services.
    ``(d) Collection Procedures.--The Secretary shall provide case 
sampling plans and data collection procedures as considered necessary 
to make statistically valid estimates of plan performance.
    ``(e) Verification.--The Secretary shall develop and implement 
procedures for verifying the quality of the data submitted by the 
State, and shall provide technical assistance, funded by the compliance 
penalties imposed under section 412, if such data quality falls below 
acceptable standards.

``SEC. 415. COMPILATION AND REPORTING OF DATA.

    ``(a) Current Programs.--The Secretary, on the basis of the 
Secretary's review of the reports received from the States under 
section 414, shall compile such data as the Secretary believes 
necessary, and from time to time, publish the findings as to the 
effectiveness of the programs developed and administered by the States 
under this part. The Secretary annually shall report to the Congress on 
the programs developed and administered by each State under this part.
    ``(b) Research, Demonstration and Evaluation.--For each fiscal year 
beginning with fiscal year 1996, from the appropriation account 
providing funds for grants to States for activities funded under 
section 413(a)(1), the Secretary may reserve for obligation, or 
transfer to other accounts funding research activities, an amount not 
to exceed 0.19 percent of the total amount paid to States in the 
previous fiscal year for activities under section 413(a)(1), and may 
use the reserved amounts to pay costs of the following types of 
research, demonstrations, and evaluations:
            ``(1) State-initiated research.--States may apply for 
        grants to cover up to 90 percent of the costs of self-
        evaluations of programs under State plans approved under this 
        part.
            ``(2) Demonstrations.--
                    ``(A) In general.---The Secretary may implement and 
                evaluate demonstrations of innovative and promising 
                strategies to--
                            ``(i) improve child well-being through 
                        reductions in illegitimacy, teen pregnancy, 
                        welfare dependency, homelessness, and poverty;
                            ``(ii) test promising strategies by 
                        nonprofit and for-profit institutions to 
                        increase employment, earnings, child support 
                        payments, and self-sufficiency with respect to 
                        temporary employment assistance clients under 
                        State plans; and
                            ``(iii) foster the development of child 
                        care.
                    ``(B) Additional parameters.--Demonstrations 
                implemented under this paragraph--
                            ``(i) may provide one-time capital funds to 
                        establish, expand, or replicate programs;
                            ``(ii) may test performance-based grant-to-
                        loan financing in which programs meeting 
                        performance targets receive grants while 
                        programs not meeting such targets repay funding 
                        on a pro-rated basis; and
                            ``(iii) should test strategies in multiple 
                        States and types of communities.
            ``(3) Federal evaluations.--
                    ``(A) In general.--The Secretary shall conduct 
                research on the effects, benefits, and costs of 
                different approaches to operating welfare programs, 
                including an implementation study based on a 
                representative sample of States and localities, 
                documenting the policies adopted, how such policies 
                were implemented, the types and mix of services 
                provided, and such other factors as the Secretary 
                considers appropriate.
                    ``(B) Research on related issues.--The Secretary 
                also shall conduct research on issues related to the 
                purposes of this part, such as strategies for moving 
                welfare recipients into the workforce quickly, reducing 
                teen pregnancies and out-of-wedlock births, and 
                providing adequate child care.
                    ``(C) State reimbursement.--The Secretary may 
                reimburse a State for any research-related costs 
                incurred pursuant to research conducted under this 
                paragraph.
                    ``(D) Use of random assignment.--Evaluations 
                authorized under this paragraph should use random 
                assignment to the maximum extent feasible and 
                appropriate.
    ``(c) Study by the Census Bureau.
            ``(1) In general.--The Bureau of the Census shall expand 
        the Survey of Income and Program Participation as necessary to 
        obtain such information as will enable interested persons to 
        evaluate the impact of the amendments made by the Work First 
        and Personal Responsibility Act of 1996 on a random national 
        sample of recipients of assistance under State programs funded 
        under this part and (as appropriate) other low-income families, 
        and in doing so, shall pay particular attention to the issues 
        of out-of-wedlock birth, welfare dependency, the beginning and 
        end of welfare spells, and the causes of repeat welfare spells.
            ``(2) Appropriation.--For each of fiscal years 1996, 1997, 
        1998, 1999, 2000, 2001, and 2002, from the appropriation 
        account providing funds for grants to States for activities 
        funded under section 413(a)(1), the Secretary shall transfer to 
        the Bureau of the Census $10,000,000 to carry out paragraph 
        (1). Such funds transferred to the Bureau of the Census shall 
        remain available for obligation by the Bureau of the Census 
        until expended.

``SEC. 416. COLLECTION OF OVERPAYMENTS FROM FEDERAL TAX REFUNDS.

    ``(a) In General.--Upon receiving notice from a State agency 
administering a plan approved under this part that a named individual 
has been overpaid under the State plan approved under this part, the 
Secretary of the Treasury shall determine whether any amounts as 
refunds of Federal taxes paid are payable to such individual, 
regardless of whether such individual filed a tax return as a married 
or unmarried individual. If the Secretary of the Treasury finds that 
any such amount is payable, the Secretary shall withhold from such 
refunds an amount equal to the overpayment sought to be collected by 
the State and pay such amount to the State agency.
    ``(b) Regulations.--The Secretary of the Treasury shall issue 
regulations, approved by the Secretary of Health and Human Services, 
that provide--
            ``(1) that a State may only submit under subsection (a) 
        requests for collection of overpayments with respect to 
        individuals--
                    ``(A) who are no longer receiving temporary 
                employment assistance under the State plan approved 
                under this part,
                    ``(B) with respect to whom the State has already 
                taken appropriate action under State law against the 
                income or resources of the individuals or families 
                involved; and
                    ``(C) to whom the State agency has given notice of 
                its intent to request withholding by the Secretary of 
                the Treasury from the income tax refunds of such 
                individuals;
            ``(2) that the Secretary of the Treasury will give a timely 
        and appropriate notice to any other person filing a joint 
        return with the individual whose refund is subject to 
        withholding under subsection (a); and
            ``(3) the procedures that the State and the Secretary of 
        the Treasury will follow in carrying out this section which, to 
        the maximum extent feasible and consistent with the specific 
        provisions of this section, will be the same as those issued 
        pursuant to section 464(b) applicable to collection of past-due 
        child support.

``SEC. 417. ASSISTANT SECRETARY FOR FAMILY SUPPORT.

    ``The programs under this title shall be administered by an 
Assistant Secretary for Family Support within the Department of Health 
and Human Services, who shall be appointed by the President, by and 
with the advice and consent of the Senate, and who shall be in addition 
to any other Assistant Secretary of Health and Human Services provided 
for by law. If an individual is the Assistant Secretary for Children 
and Families on the day before the enactment of this Act, that 
individual shall become the Assistant Secretary for Family Support.''.

SEC. 103. CONFORMING AMENDMENTS RELATING TO COLLECTION OF OVERPAYMENTS.

    (a) Section 6402 of the Internal Revenue Code of 1986 (relating to 
authority to make credits or refunds) is amended--
            (1) in subsection (a), by striking ``(c) and (d)'' and 
        inserting ``(c), (d), and (e)'';
            (2) by redesignating subsections (e) through (i) as 
        subsections (f) through (j), respectively; and
            (3) by inserting after subsection (d) the following:
    ``(e) Collection of Overpayments Under Title IV-A of the Social 
Security Act.--The amount of any overpayment to be refunded to the 
person making the overpayment shall be reduced (after reductions 
pursuant to subsections (c) and (d), but before a credit against future 
liability for an internal revenue tax) in accordance with section 416 
of the Social Security Act (concerning recovery of overpayments to 
individuals under State plans approved under part A of title IV of such 
Act).''.
    (b) Paragraph (10) of section 6103(l) of the Internal Revenue Code 
of 1986 is amended--
            (1) by striking ``(c) or (d)'' each place it appears and 
        inserting ``(c), (d), or (e)''; and
            (2) by adding at the end of subparagraph (B) the following 
        new sentence; ``Any return information disclosed with respect 
        to section 6402(e) shall only be disclosed to officers and 
        employees of the State agency requesting such information.''.
    (c) The matter preceding subparagraph (A) of section 6103(p)(4) of 
such Code is amended--
            (1) by striking ``(10),'' before ``(11)'' and
            (2) by inserting ``(10),'' after ``(9),''.
    (d) Section 552a(a)(8)(B)(iv)(III) of title 5, United States Code, 
is amended by striking ``section 464 or 1137 of the Social Security 
Act'' and inserting ``section 416, 464, or 1137 of the Social Security 
Act''.

SEC. 104. TERRITORIES.

    (a) Limitations on Federal Payments.--Section 1108(a)(2) and (3) of 
the Act is amended to read as follows:
            ``(2) for payment to the Virgin Islands shall not exceed--
                    ``(A) $2,800,000 with respect to fiscal years 1994, 
                1995, and 1996, and
                    ``(B) $3,500,000 or, if greater, such amount 
                adjusted by the CPI (as prescribed in subsection (f)) 
                for fiscal year 1997 and each fiscal year thereafter; 
                and
            ``(3) for payment to Guam shall not exceed--
                    ``(A) $3,800,000 with respect to fiscal year 1994, 
                1995, and 1996, and
                    ``(B) $4,750,000 or, if greater, such amount 
                adjusted by the CPI (as prescribed in subsection (f)), 
                for fiscal year 1997 and each fiscal year 
                thereafter.''.
    (b) CPI Adjustment.--Section 1108 of the Act is amended by adding 
at the end the following new subsection:
    ``(f) For purposes of subsection (a), an amount is `adjusted by the 
CPI' for months in a calendar year by multiplying that amount by the 
ratio of the Consumer Price Index as prepared by the Department of 
Labor for--
            ``(1) the third quarter of the preceding calendar year, to
            ``(2) the third quarter of calendar year 1996, and rounding 
        the product, if not a multiple of $10,000, to the nearer 
        multiple of $10,000.''.

SEC. 105. EFFECTIVE DATES.

    (a)(1) In General.--Except as provided in paragraph (2), the 
amendments made by sections 102 and 104 of this Act are effective with 
respect to calendar quarters beginning on or after October 1, 1996.
    (2)(A) Funds that would be available for obligation in fiscal year 
1996 under section 415 of the Social Security Act (as amended by this 
Act) are available upon enactment.
    (B) Amendments made by section 103 of this Act are effective upon 
enactment.
    (b) Special Rule.--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 requirements 
imposed by the amendments made by this subtitle, the State shall not be 
regarded as failing to comply with those requirements 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 the 
date of enactment of this Act. For purposes of this paragraph, 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. Such a State, however, shall be subject to the funding 
provisions in section 413 of the Social Security Act (as amended by 
this Act) on and after October 1, 1996.

                       Subtitle B--Make Work Pay

SEC. 111. TRANSITIONAL MEDICAID BENEFITS.

    (a) Permanent Extension of Authority.--Subsection (f) of section 
1925 of the Social Security Act (42 U.S.C. 1396r-6(f)) is repealed.
    (b) Effective Date.--The repeal made by subsection (a) applies to 
calendar quarters beginning on or after October 1, 1997, without regard 
to whether final regulations to carry out the repeal have been 
promulgated by that date.

SEC. 112. NOTICE OF AVAILABILITY REQUIRED TO BE PROVIDED TO APPLICANTS 
              AND FORMER RECIPIENTS OF TEMPORARY EMPLOYMENT ASSISTANCE, 
              FOOD STAMPS, AND MEDICAID.

    (a) Temporary Employment Assistance.--Section 406, as added by 
section 102 of this Act, is amended by adding at the end the following:
    ``(i) Notice of Availability of EITC.--The State plan shall provide 
that the State agency shall provide written notice of the existence and 
availability of the earned income credit under section 32 of the 
Internal Revenue Code of 1986 to--
            ``(1) any individual who applies for assistance under the 
        State plan, upon receipt of the application; and
            ``(2) any recipient of assistance under the State plan 
        under this part (including any recipient of assistance under 
        the plan in effect before the effective date of the Work First 
        and Personal Responsibility Act of 1996) whose assistance is 
        terminated, in the notice of termination of benefits.''.
    (b) Food Stamps.--Section 11(e) of the Food Stamp Act of 1977 (7 
U.S.C. 2020(e)), as amended by sections 323(b), 330(c), and 364(1)(C) 
and (D) of this Act, is amended--
            (1) in paragraph (24) by striking ``and'' at the end;
            (2) in paragraph (25) by striking the period at the end and 
        inserting ``; and''; and
            (3) by inserting after paragraph (25) the following:
            ``(26) that whenever a household applies for food stamp 
        benefits, and at other times the Secretary considers 
        appropriate, the State agency shall provide to each member of 
        such household notice of--
                    ``(A) the existence of the earned income tax credit 
                under section 32 of the Internal Revenue Code of 1986; 
                and
                    ``(B) the fact that such credit may be applicable 
                to such member.''.
    (c) The second sentence of section 5(a) of the Food Stamp Act of 
1977 (7 U.S.C. 2014(a) is amended by--
            (1) striking ``plan approved'' and inserting ``program 
        funded''; and
            (2) inserting before ``, supplemental security income'' the 
        following ``that limits receipt of benefits to households whose 
        gross income, as defined by the State, does not exceed the 
        poverty line, as described in subsection (c), by more than 30 
        per cent''.
    (d) Medicaid.--Section 1902(a) (42 U.S.C. 1396a(a)) is amended--
            (1) by striking ``and'' at the end of paragraph (61);
            (2) by striking the period at the end of paragraph (62) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (62) the following new 
        paragraph:
            ``(63) provide that the State shall provide notice of the 
        existence and availability of the earned income tax credit 
        under section 32 of the Internal Revenue Code of 1986 to each 
        individual applying for medical assistance under the State plan 
        and to each individual whose eligibility for medical assistance 
        under the State plan is terminated.''.

SEC. 113. ADVANCE PAYMENT OF EARNED INCOME TAX CREDIT THROUGH STATE 
              DEMONSTRATION PROGRAMS.

    (a) In General.--Section 3507 of the Internal Revenue Code of 1986 
(relating to the advance payment of the earned income tax credit) is 
amended by adding at the end the following:
    ``(g) State Demonstrations.--
            ``(1) In general.--In lieu of receiving earned income 
        advance amounts from an employer under subsection (a), a 
        participating resident shall receive advance earned income 
        payments from a responsible State agency pursuant to a State 
        Advance Payment Program that is designated pursuant to 
        paragraph (2).
            ``(2) Designations.--
                    ``(A) In general.--From among the States submitting 
                proposals satisfying the requirements of paragraph (3), 
the Secretary (in consultation with the Secretary of Health and Human 
Services and the Secretary of Agriculture) may designate not more than 
4 State Advance Payment Demonstrations. These States may operate 
demonstrations in areas that include, in the aggregate, no more than 10 
percent of the total number of households participating in the program 
under the Food Stamp program in the immediately preceding fiscal year. 
Administrative costs of a State in conducting a demonstration under 
this section may be included for matching under section 413(a)(2) of 
the Social Security Act.
                    ``(B) When designation may be made.--Any 
                designation under this paragraph shall be made no later 
                than December 31, 1998.
                    ``(C) Period for which designation is in effect.--
                            ``(i) In general.--Designations made under 
                        this paragraph shall be effective for advance 
                        earned income payments made after December 31, 
                        1998, and before January 1, 2002.
                            ``(ii) Special rules.--
                                    ``(I) Revocation of designations.--
                                The Secretary may revoke any 
                                designation made under this paragraph 
                                if the Secretary determines that the 
                                State is not complying substantially 
                                with the proposal described in 
                                paragraph (3) submitted by the State.
                                    ``(II) Automatic termination of 
                                designations.--Any failure by a State 
                                to comply with the reporting 
                                requirements described in paragraphs 
                                (3)(F) and (3)(G) shall have the effect 
                                of immediately terminating the 
                                designation under this paragraph and 
                                rendering paragraph (5)(A)(ii) 
                                inapplicable to subsequent payments.
            ``(3) Proposals.--No State may be designated under 
        paragraph (2) unless the State's proposal for such 
        designation--
                    ``(A) identifies the responsible State agency,
                    ``(B) describes how and when the advance earned 
                income payments will be made by that agency, including 
                a description of any other State or Federal benefits 
                with which such payments will be coordinated,
                    ``(C) describes how the State will obtain the 
                information on which the amount of advance earned 
                income payments made to each participating resident 
                will be determined in accordance with paragraph (4),
                    ``(D) describes how State residents who will be 
                eligible to receive advance earned income payments will 
                be selected, notified of the opportunity to receive 
                advance earned income payments from the responsible 
                State agency, and given the opportunity to elect to 
                participate in the program,
                    ``(E) describes how the State will verify, in 
                addition to receiving the certifications and statement 
                described in paragraph (7)(D)(iv), the eligibility of 
                participating residents for the earned income tax 
                credit,
                    ``(F) commits the State to furnishing to each 
                participating resident, by January 31 of each year a 
                written statement showing--
                            ``(i) the name and taxpayer identification 
                        number of the participating resident and by 
                        January 31 the amounts paid to each 
                        participating resident, and
                            ``(ii) the total amount of advance earned 
                        income payments made to the participating 
                        resident during the prior calendar year,
                    ``(G) commits the State to furnishing to the 
                Secretary by December 1 of each year a written 
                statement showing the name and taxpayer identification 
                number of each participating resident, and by January 
                31 the amounts paid to each participating resident,
                    ``(H) commits the State to treat any advance earned 
                income payments as described in paragraph (5) and any 
                repayments of excessive advance earned income payments 
                as described in paragraph (6),
                    ``(I) commits the State to assess the development 
                and implementation of its State Advance Payment 
                Program, including an agreement to share its findings 
                and lessons with other interested States in a manner to 
                be described by the Secretary, and
                    ``(J) is submitted to the Secretary on or before 
                June 30, 1998.
            ``(4) Amount and timing of advance earned income 
        payments.--
                    ``(A) Amount.--
                            ``(i) In general.--The method for 
                        determining the amount of advance earned income 
                        payments made to each participating resident 
                        shall conform to the fullest extent possible 
                        with the provisions of subsection (c).
                            ``(ii) Special rule.--A State may, at its 
                        election, apply the rules of subsection 
                        (c)(2)(B) by substituting `between 60 percent 
                        and 75 percent of the credit percentage in 
                        effect under section 32(b)(1) for an individual 
                        with the corresponding number of qualifying 
                        children' for `60 percent of the credit 
                        percentage in effect under section 32(b)(1) for 
                        such an eligible individual with 1 qualifying 
                        child' in clause (i) and `the same percentage 
                        (as applied in clause (i))' for `60 percent' in 
                        clause (ii).
                    ``(B) Timing.--The frequency of advance earned 
                income payments may be determined on the basis of the 
                payroll periods of participating residents, on a single 
                statewide schedule, or on any other reasonable basis 
                prescribed by the State in its proposal; however, in no 
                event may advance earned income payments be made to any 
participating resident less frequently than on a calendar-quarter 
basis.
            ``(5) Payments to be treated as payments of withholding and 
        fica taxes.--
                    ``(A) In general.--For purposes of this title, 
                advance earned income payments during any calendar 
                quarter--
                            ``(i) shall neither be treated as a payment 
                        of compensation nor be included in gross 
                        income, and
                            ``(ii) shall be treated as made out of--
                                    ``(I) amounts required to be 
                                deducted by the State and withheld for 
                                the calendar quarter by the State under 
                                section 3401 (relating to wage 
                                withholding),
                                    ``(II) amounts required to be 
                                deducted for the calendar quarter under 
                                section 3102 (relating to FICA employee 
                                taxes), and
                                    ``(III) amounts of the taxes 
                                imposed on the State for the calendar 
                                quarter under section 3111 (relating to 
                                FICA employer taxes), as if the State 
                                had paid to the Secretary, on the day 
                                on which payments are made to 
                                participating residents, an amount 
                                equal to such payments.
                    ``(B) If advance payments exceed taxes due.--If for 
                any calendar quarter the aggregate amount of advance 
                earned income payments made by the responsible State 
                agency under a State Advance Payment Program exceeds 
                the sum of the amounts referred to in subparagraph 
                (A)(ii) (without regard to paragraph (6)(A)), each such 
                advance earned income payment shall be reduced by an 
                amount which bears the same ratio to such excess as 
                such advance earned income payment bears to the 
                aggregate amount of all such advance earned income 
                payments.
            ``(6) State repayment of excessive advance earned income 
        payments.--
                    ``(A) In general.--Notwithstanding any other 
                provision of law, in the case of an excessive advance 
                earned income payment a State shall be treated as 
                having deducted and withheld under section 3401 
                (relating to wage withholding), and as being required 
                to pay to the United States, the repayment amount 
                during the repayment calendar quarter.
                    ``(B) Excessive advance earned income payment.--For 
                purposes of this section, the term `excessive advance 
                income payment' means that portion of any advance 
                earned income payment that, when combined with other 
                advance earned income payments previously made to the 
                same participating resident during the same calendar 
                year, exceeds the amount of earned income tax credit to 
                which that participating resident is entitled under 
                section 32 for that year.
                    ``(C) Repayment amount.--For purposes of this 
                subsection, the term `repayment amount' means an amount 
                equal to 50 percent of the excess of--
                            ``(i) excessive advance earned income 
                        payments made by a State during a particular 
                        calendar year, over
                            ``(ii) the sum of--
                                    ``(I) 4 percent of all advance 
                                earned income payments made by the 
                                State during that calendar year, and
                                    ``(II) the excessive advance earned 
                                income payments made by the State 
                                during that calendar year that have 
                                been collected from participating 
                                residents by the Secretary.
                    ``(D) Repayment calendar quarter.--For purposes of 
                this subsection, the term `repayment calendar quarter' 
                means the second calendar quarter of the third calendar 
                year beginning after the calendar year in which an 
                excessive earned income payment is made.
            ``(7) Definitions.--For purposes of this subsection--
                    ``(A) State advance payment program.--The term 
                `State Advance Payment Program' means the program 
                described in a proposal submitted for designation under 
                paragraph (1) and designated by the Secretary under 
                paragraph (2).
                    ``(B) Responsible state agency.--The term 
                `responsible State agency' means the single State 
                agency that will be making the advance earned income 
                payments to residents of the State who elect to 
                participate in a State Advance Payment Program.
                    ``(C) Advance earned income payments.--The term 
                `advance earned income payments' means an amount paid 
                by a responsible State agency to residents of the State 
                pursuant to a State Advance Payment Program.
                    ``(D) Participating resident.--The term 
                `participating resident' means an individual who--
                            ``(i) is a resident of a State that has in 
                        effect a designated State Advance Payment 
                        Program,
                            ``(ii) makes the election described in 
                        paragraph (3)(D) pursuant to guidelines 
                        prescribed by the State,
                            ``(iii) certifies to the State the number 
                        of qualifying children the individual has, and
                            ``(iv) provides to the State the 
                        certifications and statement described in 
                        subsections (b)(1), (b)(2), (b)(3), and (b)(4) 
                        (except that for purposes of this clause, the 
                        term `any employer' shall be substituted for 
                        `another employer' in subsection (b)(3)), along 
                        with any other information required by the 
                        State.''.
    (b) Technical Assistance.--The Secretaries of the Treasury and 
Health and Human Services shall jointly ensure that technical 
assistance is provided to State Advance Payment Programs and that these 
programs are rigorously evaluated.
    (c) Annual Reports.--The Secretary shall issue annual reports 
detailing the extent to which--
            (1) residents participate in the State Advance Payment 
        Programs,
            (2) participating residents file Federal and State tax 
        returns,
            (3) participating residents report accurately the amount of 
        the advance earned income payments made to them by the 
        responsible State agency during the year, and
            (4) recipients of excessive advance earned income payments 
        repay those amounts.
The report shall also contain an estimate of the amount of advance 
earned income payments made by each responsible State agency but not 
reported on the tax returns of a participating resident and the amount 
of excessive advance earned income payments.
    (d) Authorization of Appropriations.--For purposes of providing 
technical assistance described in subsection (b), preparing the reports 
described in subsection (c), and providing grants to States in support 
of designated State Advance Payment Programs, there are authorized to 
be appropriated in advance to the Secretary of the Treasury and the 
Secretary of Health and Human Services a total of $1,400,000 for fiscal 
years 1999 through 2001.

SEC. 114. CONSOLIDATED CHILD CARE AND DEVELOPMENT BLOCK GRANT.

    (a) Purpose.--It is the purpose of this section to amend the Child 
Care and Development Block Grant Act of 1990 (referred to in this 
section as the ``CCDBG Act'') and to consolidate other child care 
programs into the program under that Act, in order to--
            (1) eliminate program fragmentation and create a seamless 
        system of high quality child care that allows for continuity of 
        care for children as parents move from welfare to work;
            (2) provide for parental choice among high quality child 
        care programs; and
            (3) increase the availability of high quality affordable 
        child care in order to promote self-sufficiency and support 
        working families.
    (b) Authorization of Appropriations.--Section 658B of the CCDBG Act 
(42 U.S.C. 9858) is amended to read as follows:

``SEC. 658B. AUTHORIZATION OF APPROPRIATIONS.

    ``(a) Authorization of Discretionary Appropriations of Block Grant 
Funds.--For the purpose of providing child care services for eligible 
children through the awarding of grants to States under this subchapter 
(other than the grants awarded under subsection (b)) by the Secretary, 
there are authorized to be appropriated $2,000,000,000 for fiscal year 
1996 and such sums as may be necessary for fiscal years 1997 through 
2002.
    ``(b) Entitlement to States.--For the purpose of providing child 
care services for eligible children, in addition to grants from 
appropriations authorized under subsection (a), there are authorized to 
be appropriated and States shall be entitled to receive matching grants 
under section 658Ob in amounts not to exceed in total $1,555,000,000 
for fiscal year 1997, $1,615,000,000 for fiscal year 1998, 
$1,800,000,000 for fiscal year 1999, $2,200,000,000 for fiscal year 
2000, $2,475,000,000 for fiscal year 2001, and $2,525,000,000 for 
fiscal year 2002.''.
    (c) Use of Block Grant Funds.--
            (1) Services to families in welfare-to-work transition.--
        Section 658E(c)(3)(B) of the CCDBG Act (42 U.S.C. 
        9858c(c)(3)(B)) is amended--
                    (A) by redesignating clauses (i) and (ii) as 
                subclauses (I) and (II), respectively, and realigning 
                the margins accordingly;
                    (B) by striking ``Subject'' and inserting the 
                following:
                            ``(i) In general.--Subject''; and
                    (C) by adding at the end the following new clause:
                            ``(ii) Special rules for families seeking 
                        to become or becoming independent of temporary 
                        employment assistance.--
                                    ``(I) In general.--Each State 
                                agency referred to in section 658D 
                                shall guarantee child care in 
                                accordance with this Act--
                                            ``(aa) for any individual 
                                        who is participating in an 
                                        education or training activity 
                                        (including participation in a 
                                        program established under part 
                                        F, G, or H of title IV of the 
                                        Social Security Act) if the 
                                        State agency administering the 
                                        program under part F of that 
                                        title approves the activity and 
                                        determines that the individual 
                                        is participating satisfactorily 
                                        in the activity;
                                            ``(bb) for each family with 
                                        a needy child (as defined in 
                                        section 402(a)(1) of the Social 
                                        Security Act) requiring such 
                                        care, to the extent that such 
                                        care is determined by the State 
                                        agency to be necessary to 
                                        permit an individual in the 
                                        family to accept employment or 
                                        remain employed, including in a 
                                        community service job under 
                                        part F, G, or H of title IV of 
                                        the Social Security Act; and
                                            ``(cc) to the extent that 
                                        the State agency determines 
                                        that such care is necessary for 
                                        the employment of an 
                                        individual, if the family of 
                                        which the individual is a 
                                        member has ceased to receive 
                                        assistance under the State plan 
                                        approved under part A of title 
                                        IV of the Social Security Act 
                                        by reason of increased hours 
                                        of, or income from, such 
                                        employment, for 12 months after 
                                        the last month for which the 
                                        family received assistance 
                                        described in such paragraph.''.
            (2) Set-asides for quality and expansion.--Section 
        658E(c)(3)(C) of the CCDBG Act (42 U.S.C. 9858c(c)(3)(C)) is 
        amended by striking ``25 percent'' and inserting ``10 
        percent''.
            (3) Support of welfare-to-work.--
                    (A) In general.--Section 658E(c) of the CCDBG Act 
                (42 U.S.C. 9858c(c)) is amended by adding the 
                following:
            ``(6) Significant expenditures to support welfare-to-work 
        transition.--The State plan shall provide that the State will 
        use significant portions of amounts provided for child care 
        services for each of the following:
                    ``(A) Families containing an individual receiving 
                assistance under a State plan approved under part A of 
                title IV of the Social Security Act and participating 
                in education, job search, job training, work, or 
                workforce programs;
                    ``(B) Families containing an individual who--
                            ``(i) has ceased to receive assistance 
                        under the temporary employment assistance 
                        program under part A of title IV of the Social 
                        Security Act as a result of increased hours of, 
                        or increased income from, employment, and no 
                        longer qualifies for child care assistance on 
                        the basis of receiving such assistance under 
                        part A of title IV of the Social Security Act; 
                        and
                            ``(ii) the State determines requires such 
                        child care assistance in order to continue such 
                        employment.
                    ``(C) Families containing an individual who--
                            ``(i) is not described in subparagraph (A) 
                        or (B); and
                            ``(ii) has an annual income for a fiscal 
                        year below 75 percent of the State median 
                        income.''.
                    (B) Conforming amendments.--
                            (i) Section 658E(c)(3)(B)(i)(I) of the 
                        CCDBG Act, as redesignated by paragraph (1), is 
                        amended by inserting ``consistent with 
                        paragraph (6)'' after ``child care services''.
                            (ii) Subsection 658F(a) is amended by 
                        striking ``Nothing'' and inserting ``Except as 
                        provided in section 658E(c)(B)(ii), nothing''.
            (4) Sliding fee scale.--Section 658E(c)(5) of the CCDBG Act 
        (42 U.S.C. 9858c(c)(5)) is amended by inserting ``described in 
        subparagraphs (B) and (C) of paragraph (6)'' after 
        ``families''.
    (d) Limited Entitlement; Allocation.--
            (1) In general.--The CCDBG Act (42 U.S.C. 9858) is amended 
        by adding after section 6580 the following new section:

``SEC. 6580B. ALLOCATION OF LIMITATION ON ENTITLEMENT.

    ``(a) Each State shall be entitled to payment from the Secretary of 
an amount equal to the lesser of:
            ``(1) the Federal medical assistance percentage (as defined 
        in section 1905(b) or, as applicable, in section 1118 of the 
        Social Security Act) of the amount of expenditures made by the 
        State in providing child care services pursuant to this 
        subchapter, other than expenditures of funds appropriated under 
        subsection 658B(a); or
            ``(2) the limitation determined under subsection (b).
    ``(b) Limitation on Entitlement.--Subject to the redistribution 
procedures under subsection (c), the limitation for a State for a 
fiscal year under this paragraph shall be an amount equal to the 
product of--
            ``(1) the sum of the total amounts of Federal payments for 
        fiscal year 1994 to the State under--
                    ``(A) section 402(g)(3)(A) of the Social Security 
                Act (as that section was in effect before October 1, 
                1995) for amounts expended for child care pursuant to 
                paragraph (1) of such subsection;
                    ``(B) section 403(l)(1)(A) of that Act (as so in 
                effect) for amounts expended for child care pursuant to 
                section 402(g)(1)(A) of that Act (as so in effect), in 
                the case of a State with respect to which section 1108 
                of that Act applies; and
                    ``(C) section 403(n) of that Act (as so in effect) 
                for child care services pursuant to section 402(i) of 
                that Act;
        divided by the total amount of such Federal payments to all 
        States for fiscal year 1994; and
            ``(2) the total limitation for all States under subsection 
        658B(b) for such fiscal year, reduced by the amount reserved 
        under subsection (d).
    ``(c) Adjustment of Limitation; Reallotment.--
            ``(1) Availability of unused amounts for reallotment.--If 
        the Secretary determines that a State will not use the full 
        limitation amount available to it for a fiscal year (as 
        calculated under subsection (b)), the Secretary shall--
                    ``(A) reduce that State's limitation under 
                subsection (b) by the amount the Secretary determines 
                the State will not use; and
                    ``(B) increase by no more than the amount of 
                reductions under subparagraph (A) the limitations 
                available to States under subsection (b) that have 
                requested an increase in their limitations.
            ``(2) Reallotment formula.--Limitation increases available 
        under paragraph (1) shall be made available to each State 
        requesting an increase in its limitation amount that bears the 
        same ratio to the total available increase in limitations as 
        the State's historical expenditures described in subsection 
        (b)(1) bear to the sum of such historical expenditures for all 
        States requesting an increase in their limitations.
    ``(d) Amounts Reserved for Indian Tribes.--The Secretary shall 
reserve not more than 3 percent of the amount appropriated under 
section 658B(b) each fiscal year for payments to Indian tribes and 
tribal organizations with applications approved under section 658Oa(c). 
The amounts reserved under the prior sentence shall be available to 
make grants to or enter into contracts with Indian tribes or tribal 
organizations consistent with section 6580a(c), without a requirement 
of matching funds by the Indian tribes or tribal organizations.
    ``(e) Same Treatment as Allotments.--Amounts paid to a State or 
Indian tribe under subsections (a) and (d) shall be subject to the same 
requirements under this subchapter as amounts paid from the allotment 
under section 658Oa, except that section 658J(c) shall not apply.''.
            (2) Conforming amendments.--
                    (A) Section 658O of the CCDBG Act (42 U.S.C. 9858m) 
                is amended--
                            (i) by striking ``Sec. 6580.'' and 
                        inserting ``Sec. 6580a. Discretionary 
                        Appropriations;'';
                            (ii) in subsection (a)--
                                    (I) in paragraph (1), by striking 
                                ``this subchapter'' and inserting 
                                ``section 658B(a)''; and
                                    (II) in paragraph (2), by striking 
                                658B'' and inserting ``658B(a)''; and
                            (iii) in subsection (b)(1), by striking 
                        ``section 658B'' and inserting ``section 
                        658B(a)''.
                    (B) Subsection 658J(c) of the CCDBG Act (42 U.S.C. 
                9858m) is amended by striking ``658O'' and inserting 
                ``658Oa''.
    (e) Improving Quality.--
            (1) Increase in required funding.--Section 658G of the 
        CCDBG Act (42 U.S.C. 9858e) is amended by striking ``not less 
        than 20 percent of the''.
            (2) Quality improvement incentive initiative.--Section 658G 
        of the CCDBG Act (42 U.S.C. 9858e) is further amended--
                    (A) by adding at the end the following new 
                paragraphs:
            ``(6) Before- and after-school activities.--Increasing the 
        availability of before- and after-school care.
            ``(7) Infant care.--Increasing the availability of child 
        care for infants under the age of 18 months.
            ``(8) Nontraditional work hours.--Increasing the 
        availability of child care between the hours of 5:00 p.m. and 
        8:00 a.m.'';
                    (B) by striking ``A State'' and inserting ``(a) In 
                General.--A State''; and
                    (C) by adding at the end the following new 
                subsection:
    ``(b) Quality Improvement Incentive Initiative.--
            ``(1) In general.--The Secretary shall establish a child 
        care quality improvement incentive initiative to make funds 
        available to States that demonstrate progress in the 
        implementation of--
                    ``(A) innovative teacher training programs such as 
                the Department of Defense staff development and 
                compensation program for child care personnel; or
                    ``(B) enhanced child care quality standards and 
                licensing and monitoring procedures.
            ``(2) Funding.--From the amounts made available for each 
        fiscal year under subsection (a), the Secretary shall reserve 
        not to exceed $25,000,000 for each such fiscal year to carry 
        out this subsection.''.
    (f) Payments.--
            (1) Section 658H of the CCDBG Act (42 U.S.C. 9858f) is 
        repealed.
            (2) Section 658J(a) of the CCDBG Act (42 U.S.C. 9858h) is 
        amended to read as follows:
    ``(a) In General.--Subject to the availability of appropriations 
under Section 658B(a) and the limitations and other requirements under 
658Ob, a State that has an application approved by the Secretary under 
section 658E shall be entitled to a payment in a fiscal year in an 
amount equal to the sum of its allotment under section 658Oa for that 
year and the amount determined for that State for that fiscal year 
under 658Ob(a).''.
    (g) Annual Report.--Section 658K(a) of the CCDBG Act (42 U.S.C. 
9858i) is amended by adding after paragraph (6) the following new 
paragraph:
            ``(7) specifying the total amount expended by the State for 
        child care under part 658E(c)(3)(B)(ii), and describing the 
        types of child care provided, such as child care provided in 
        the case of a family that has ceased to receive assistance 
        under part A of title IV of the Social Security Act because of 
        increased hours of, or increased income from, employment; or 
        child care provided in the case of a family that is not 
        receiving assistance under that part but would be at risk of 
        becoming eligible for such assistance if child care was not 
        provided.''.
    (h) Program Repeals.--
            (1) State dependent care grants.--Subchapter E of chapter 8 
        of subtitle A of title VI of the Omnibus Budget Reconciliation 
        Act of 1981 (42 U.S.C. 9871 et seq.) is repealed.
            (2) Child development associate scholarship assistance 
        act.--The Child Development Associate Scholarship Assistance 
        Act of 1985 (42 U.S.C. 10901 et seq.) is repealed.

SEC. 115. EFFECTIVE DATES.

    The amendments made by this subtitle are effective with respect to 
calendar quarters beginning on or after October 1, 1996.

                         Subtitle C--Work First

SEC. 121. WORK FIRST PROGRAM.

    (a) Establishment and Operation of Program.--Title IV (42 U.S.C. 
601 et seq.) is amended by striking part F and inserting the following:

                      ``PART F--WORK FIRST PROGRAM

``SEC. 481. STATE ROLE.

    ``(a) Program Requirements.--Each State that operates a program 
under part A shall establish and operate a Work First program that 
meets the following requirements:
            ``(1) Objective.--The objective of the program is for each 
        program participant to find and hold a full-time unsubsidized 
paid job, and for this goal to be achieved in a cost-effective fashion.
            ``(2) Method.--The method of the program is to connect 
        recipients of assistance under the State plan under part A with 
        the private sector labor market as soon as possible and offer 
        them the support and skills necessary to remain in the labor 
        market. Each component of the program should be permeated with 
        an emphasis on employment and with an understanding that 
        minimum wage jobs are a stepping stone to more highly paid 
        employment. The program shall provide recipients with 
        education, training, job search and placement, work 
        supplementation, temporary subsidized jobs, or such other 
        services as the State considers necessary to help a recipient 
        obtain private sector employment.
            ``(3) Job creation.--The creation of jobs, with an emphasis 
        on private sector jobs, shall be a component of the program and 
        shall be a priority for each State office with responsibilities 
        under the program.
            ``(4) Forms of assistance.--The State shall provide 
        assistance to participants in the program in the form of 
        education, training, job placement services (including vouchers 
        for job placement services), work supplementation programs, 
        temporary subsidized job creation, job counseling, assistance 
        in establishing microenterprises, or other services to provide 
        individuals with the support and skills necessary to obtain and 
        keep employment in the private sector.
            ``(5) Mutual responsibility plans.--
                    ``(A) In general.--The State agency shall develop a 
                mutual responsibility plan for each program 
                participant, which will be an individualized 
                comprehensive plan, developed by the State agency and 
                the participant, to move the participant into a full-
                time unsubsidized job. The agreement should detail the 
                education, training, or skills that the individual will 
                be receiving to obtain a full-time unsubsidized job, 
                and the obligations of the individual.
                    ``(B)(i) Hours of participation requirement.--The 
                agreement shall provide that the individual, except as 
                provided in clause (ii), shall participate in 
                activities in accordance with the agreement for--
                            ``(I) not fewer than 20 hours per week 
                        during fiscal years 1997 and 1998;
                            ``(II) not fewer than 25 hours per week 
                        during fiscal year 1999; and
                            ``(III) not fewer than 30 hours per week 
                        thereafter.
                    ``(ii) At the option of the State, a parent of a 
                child under age 6 may be required to participate in 
                such activities for fewer hours than specified in 
                clause (i) (but not fewer than 20 hours per week).
            ``(6) Caseload participation rates.--The program shall 
        comply with section 488.
            ``(7) Community service.--On and after the date which is 
        two years after the date of enactment of this part, (unless the 
        State plan under part A specifically opts out of this 
        provision) the State agency shall require a parent or caretaker 
        who--
                    ``(A) is receiving assistance under part A, and has 
                received that assistance for three months;
                    ``(B) is not exempt from work requirements; and
                    ``(C) is not participating in the programs 
                established under parts F, G, and H as determined under 
                section 488, in community service employment,
        to participate in community service, with minimum hours per 
        week and tasks to be determined by the State (and the State 
        shall offer such employment to the parent or caretaker).
            ``(8) Nondisplacement in work activities.--
                    ``(A) In general.--A State program under this part 
                or under part G or H may not be operated in a manner 
                that results in--
                            ``(i) the displacement of any currently 
                        employed worker or position (including partial 
                        displacement such as a reduction in the hours 
                        of nonovertime work, wages, or employment 
                        benefits), or the impairment of an existing 
                        contract for services or a collective 
                        bargaining agreement;
                            ``(ii) the employment or assignment of a 
                        participant or the filling of a position when
                                    ``(I) any other individual is on 
                                layoff from the same or an equivalent 
                                position, or
                                    ``(II) the employer has terminated 
                                the employment of a regular employee or 
                                otherwise reduced its workforce with 
                                the effect of filling the vacancy so 
                                created with a participant subsidized 
                                under the program under this part or 
                                under part G or H; or
                            ``(iii) an infringement of the promotional 
                        opportunity of a currently employed individual.
                Funds available to carry out the program under this 
                part or under part G or H may not be used to assist, 
                promote, or deter union organizing.
                    ``(B) Enforcing nondisplacement protections.--
                            ``(i) Grievance procedure.--Each State 
                        shall establish and maintain a grievance 
                        procedure for resolving complaints alleging 
                        violation of a prohibition or requirement of 
                        subparagraph (A). Such a procedure shall 
                        include an opportunity for a hearing. The 
                        procedure's remedies shall include, but are not 
                        limited to, termination or suspension of 
                        payments to the employer, prohibition of the 
                        placement of the program participant, 
                        reinstatement of an employee, and other relief 
                        to make an aggrieved employee whole.
                            ``(ii) Other laws or contracts.--Nothing in 
                        clause (i) shall be construed to prohibit a 
                        complainant from pursuing a remedy authorized 
                        under another Federal, State, or local law or a 
contract or collective bargaining agreement for a violation of a 
prohibition or requirement of subparagraph (A).
    ``(b) Annual Reports.--
            ``(1) Compliance with performance measures.--Each State 
        that operates a program under this part shall submit to the 
        Secretary annual reports on its performance relative to the 
        performance-based measures established under section 413(a)(4).
            ``(2) Compliance with participation rates.--Each State that 
        operates a program under this part for a fiscal year shall 
        submit to the Secretary a report on the participation rate 
        achieved by the State for the fiscal year.

``SEC. 482. REVAMPED JOBS PROGRAM.

    ``A State that establishes a program under this part may operate a 
program similar to the program known as the `GAIN Program' that has 
been operated by Riverside County, California, under this Act in effect 
immediately before the date this part (as amended by the Work First and 
Personal Responsibility Act of 1996) first applies to the State of 
California.

``SEC. 483. USE OF PLACEMENT COMPANIES.

    ``(a) In General.--A State that establishes a program under this 
part may enter into contracts with private companies (whether operated 
for profit or not for profit) for the placement of participants in the 
program in positions of full-time employment, preferably in the private 
sector, for wages sufficient to eliminate the need of such participants 
for cash assistance.
    ``(b) Required Contract Terms.--Each contract entered into under 
this section with a company shall meet the following requirements:
            ``(1) Provision of job readiness and support services.--The 
        contract shall require the company to provide, to any program 
        participant who presents to the company a voucher issued under 
        subsection (d), intensive personalized support and job 
        readiness services designed to prepare the individual for 
        employment and ensure the continued success of the individual 
        in employment.
            ``(2) Payments.--
                    ``(A) In general.--The contract shall provide for 
                payments to be made to the company with respect to each 
                program participant who presents to the company a 
                voucher issued under subsection (d).
                    ``(B) Structure.--The contract shall provide for 
                payment of the majority of the amounts under the 
                contract with respect to a program participant after 
                the company has placed the participant in a position of 
                full-time employment and the participant has been 
                employed in the position for such period of not less 
                than 5 months as the State deems appropriate.
    ``(c) Competitive Bidding Required.--Contracts under this section 
shall be awarded only after competitive bidding.
    ``(d) Vouchers.--The State shall issue a voucher to each program 
participant whose mutual responsibility plan provides for the use of 
placement companies under this section, indicating that the participant 
is eligible for the services of such a company.

``SEC. 484. TEMPORARY SUBSIDIZED JOB CREATION.

    ``A State that establishes a program under this part may establish 
a program similar to the program known as `JOBS Plus' that has been 
operated by the State of Oregon under this Act in effect immediately 
before the date this part (as amended by the Work First and Personal 
Responsibility Act of 1996) first applies to the State of Oregon.

``SEC. 485. MICROENTERPRISE.

    ``(a) Grants and Loans to Nonprofit Organizations for the Provision 
of Technical Assistance, Training, and Credit to Low-Income 
Entrepreneurs.--A State that establishes a program under this part may 
make grants and loans to nonprofit organizations to provide technical 
assistance, training, and credit to low-income entrepreneurs for the 
purpose of establishing microenterprises.
    ``(b) Microenterprise Defined.--For purposes of this section, the 
term `microenterprise' means a commercial enterprise which has 5 or 
fewer employees, 1 or more of whom owns the enterprise.

``SEC. 486. WORK SUPPLEMENTATION PROGRAM.

    ``(a) In General.--A State that establishes a program under this 
part may institute a work supplementation program under which the 
State, to the extent it considers appropriate, may reserve sums that 
would otherwise be payable under the State plan under part A to 
participants in the program and use the sums instead for the purpose of 
providing and subsidizing jobs for the participants (as described in 
subsection (c)(3)(A) and (B)).
    ``(b) State Flexibility.--
            ``(1) Nothing in this part, or in any State plan approved 
        under part A, shall be construed to prevent a State from 
        operating (on such terms and conditions and in such cases as 
        the State may find to be necessary or appropriate) a work 
        supplementation program in accordance with this section and 
        section 484 (as in effect before the date this part (as amended 
        by the Work First and Personal Responsibility Act of 1996) 
        first applies to the State).
            ``(2) Notwithstanding any other provision of law, a State 
        may adjust the levels of the standards of need under the State 
        plan as the State determines to be necessary and appropriate 
        for carrying out a work supplementation program under this 
        section.
            ``(3) Notwithstanding any other provision of law, a State 
        operating a work supplementation program under this section may 
        provide that the need standards in effect in those areas of the 
        State in which the program is in operation may be different 
        from the need standards in effect in the areas in which the 
        program is not in operation, and the State may provide that the 
        need standards for categories of recipients may vary among such 
        categories to the extent the State determines to be appropriate 
        on the basis of ability to participate in the work 
        supplementation program.
            ``(4) Notwithstanding any other provision of law, a State 
        may make such further adjustments in the amounts of assistance 
        provided under the plan to different categories of recipients 
        (as determined under paragraph (3)) in order to offset 
        increases in benefits from needs-related programs (other than 
        the State plan approved under part A) as the State determines 
        to be necessary and appropriate to further the purposes of the 
        work supplementation program.
            ``(5) In determining the amounts to be reserved and used 
        for providing and subsidizing jobs under this section as 
        described in subsection (a), the State may use a sampling 
        methodology.
            ``(6) Notwithstanding any other provision of law, a State 
        operating a work supplementation program under this section may 
        reduce or eliminate the amount of earned income to be 
        disregarded under the State plan to the extent the State 
        determines to be necessary and appropriate to further the 
        purposes of the work supplementation program.
    ``(c) Rules Relating to Supplemented Jobs.--
            ``(1) A work supplementation program operated by a State 
        under this section may require that any individual who is an 
        eligible individual (as determined under paragraph (2)) shall 
        take a supplemented job (as defined in paragraph (3)) to the 
        extent that supplemented jobs are available under the program. 
        Payments by the State to individuals or to employers under the 
        work supplementation program shall be treated as expenditures 
        incurred by the State for temporary employment assistance under 
        part A except as limited by subsection (d).
            ``(2) For purposes of this section, an eligible individual 
        is an individual who is in a category which the State 
        determines should be eligible to participate in the work 
        supplementation program, and who would, at the time of 
        placement in the job involved, be eligible for assistance under 
        an approved State plan if the State did not have a work 
        supplementation program in effect.
            ``(3) For purposes of this subsection, a supplemented job 
        is--
                    ``(A) a job provided to an eligible individual by 
                the State or local agency administering the State plan 
                under part A; or
                    ``(B) a job provided to an eligible individual by 
                any other employer for which all or part of the wages 
                are paid by the State or local agency.
A State may provide or subsidize under the program any job which the 
State determines to be appropriate.
    ``(d) Cost Limitation.--The amount of the Federal payment to a 
State under section 413 for expenditures incurred in making payments to 
individuals and employers under a work supplementation program under 
this section shall not exceed the amount which would otherwise be 
payable under section 413 if the family of each individual employed in 
the State program under this section had received the maximum amount of 
assistance payable under the State plan under part A to such a family 
with no income (without regard to adjustments under subsection (b)) for 
the lesser of--
            ``(1) 9 months; or
            ``(2) the number of months in which the individual was 
        employed in the program.
    ``(e) Rules of Interpretation.--
            ``(1) This section shall not be construed as requiring the 
        State or local agency administering the State plan under this 
        part to provide employee status to an eligible individual to 
        whom the State or local agency provides a job under the work 
        supplementation program (or with respect to whom the State or 
        local agency provides all or part of the wages paid to the 
        individual by another entity under the program), or as 
        requiring any State or local agency to require that an eligible 
        individual filling a job position provided by another entity 
        under the program be provided employee status by the entity 
        during the first 13 weeks the individual fills the position.
            ``(2) Wages paid under a work supplementation program shall 
        be considered to be earned income for purposes of any provision 
        of law.
    ``(f) Preservation of Medicaid Eligibility.--Any State that chooses 
to operate a work supplementation program under this section shall 
provide that any individual who participates in the program, and any 
child or relative of the individual (or other individual) living in the 
same household as the individual who would be eligible for assistance 
under the State plan under part A if the State did not have a work 
supplementation program, shall be considered individuals receiving 
assistance under the State plan under part A for purposes of 
eligibility for medical assistance under the State plan approved under 
title XIX.

``SEC. 487. PARTICIPATION RULES.

    A State that establishes a program under this part may require any 
individual receiving assistance under the State plan under part A to 
participate in the program, except for an individual described in 
section 402(c)(2)(C)(ii).

``SEC. 488. CASELOAD PARTICIPATION RATES.

    ``(a) Requirement.--A State that operates a program under this part 
shall achieve a participation rate for the following fiscal years of 
not less than the following percentage:

``Fiscal year:                                              Percentage:
    1997.......................................................      30
    1998.......................................................      35
    1999.......................................................      40
    2000.......................................................      45
    2001.......................................................      50
    2002.......................................................      50
    2003 or later..............................................      52
    ``(b) Participation Rate Defined.--
            ``(1) In general.--As used in this subsection, the term 
        `participation rate' means, with respect to a State and a 
        fiscal year, an amount equal to--
                    ``(A)(i) the average monthly number of families 
                receiving assistance that include an individual who, 
                during the fiscal year, participate in the State 
                program established under this part or part G or H; 
                plus
                    ``(ii) the average monthly number of families 
                receiving assistance that include an individual working 
                in unsubsidized employment for the number of hours 
                specified in section 481(a)(5)(B); plus
                    ``(iii) the average monthly number of families 
                receiving assistance subject to a penalty described in 
                section 402(c)(1) but who have not been subject to such 
                a penalty for more than three months within the 
                preceding 12-month period; divided by
                    ``(B) the average monthly number of families 
                receiving assistance that include an individual not 
                described in section 402(c)(2)(C)(ii) and for whom a 
                personal responsibility agreement is in effect under 
                section 403 during the fiscal year.
            ``(2) Special rule.--For each of the first six months after 
        an individual ceases to receive assistance under a State plan 
        approved under part A by reason of having become employed in an 
        unsubsidized job, the individual shall be considered to be 
        participating in the State program established under this part 
        for the purposes of subparagraph (A), and to be an adult 
        recipient of such assistance for the purposes of subparagraph 
        (B).
    ``(c) State Compliance Reports.--Each State that operates a program 
under this part for a fiscal year shall submit to the Secretary a 
report on the participation rate of the State for the fiscal year.
    ``(d) Effect of Failure To Meet Participation Rates.--
            ``(1) In general.--If a State reports that the State has 
        failed to achieve the participation rate required by subsection 
        (a) for the fiscal year, the Secretary may make recommendations 
        for changes in the State programs established under this part 
        and part G or H. The State may elect to follow such 
        recommendations, and shall demonstrate to the Secretary how the 
        State will achieve the required participation rates.
            ``(2) Second consecutive failure.--Notwithstanding 
        paragraph (1), if a State fails to achieve the participation 
        rate required by subsection (a) for 2 consecutive fiscal years, 
        the Secretary may--
                    ``(A) require the State to make changes in the 
                State programs established under this part and part G 
                or H; and
                    ``(B) reduce by up to 5 percent the amount 
                otherwise payable to the State under section 413(a)(1).

``SEC. 489. FEDERAL ROLE.

    ``(a) Approval of State Plans.--
            ``(1) In general.--Within 60 days after the date a State 
        submits to the Secretary a plan that provides for the 
        establishment and operation of a Work First program that meets 
        the requirements of section 481, the Secretary shall approve 
        the plan.
            ``(2) Authority to extend approval deadline.--The 60-day 
        deadline established in paragraph (1) with respect to a State 
        may be extended in accordance with an agreement between the 
        Secretary and the State.

                       ``PART G--WORKFARE PROGRAM

``SEC. 490. ESTABLISHMENT AND OPERATION OF PROGRAM.

    ``(a) In General.--A State that establishes a Work First program 
under part F shall establish and carry out either a workfare program 
that meets the requirements of this part or a job placement voucher 
program under part H.
    ``(b) Objective.--The objective of the workfare program is for each 
program participant to find and hold a full-time unsubsidized paid job, 
and for this goal to be achieved in a cost-effective fashion.
    ``(c) Case Management Teams.--The State shall assign to each 
program participant a case management team that shall meet with the 
participant and assist the participant to choose the most suitable 
workfare job under subsection (e), (f), or (g) and to eventually obtain 
a full-time unsubsidized paid job.
    ``(d) Provision of Jobs.--The State shall provide each participant 
in the program with a community service job that meets the requirements 
of subsection (e) or a subsidized job that meets the requirements of 
subsection (f) or (g).
    ``(e) Community Service Jobs.--
            ``(1) In general.--Except as provided in paragraphs (2) and 
        (3) and section 481(a)(5)(B)(ii), each participant shall work 
        for 20 hours per week during fiscal years 1997 and 1998, not 
        fewer than 25 hours per week during fiscal year 1999, and not 
        fewer than 30 hours thereafter in a community service job, and 
        shall be paid at a rate which is 100 percent of the maximum 
        amount of assistance that may be provided under the State plan 
        approved under part A to a family of the same size and 
        composition with no income.
            ``(2) Exception.--
                    ``(A) If the participant has obtained unsubsidized 
                part-time employment, the State shall provide the 
                participant with a part-time community service job.
                    ``(B) If the State provides a participant a part-
                time community service job under subparagraph (A), the 
                State shall ensure that the participant works for not 
                fewer than the number of hours specified in paragraph 
                (1).
            ``(3) Wages not considered earned income.--Wages paid under 
        a workfare program shall not be considered to be earned income 
        for purposes of any provision of law.
            ``(4) Community service job defined.--For purposes of this 
        section, the term `community service job' means--
                    ``(A) a job provided to a participant by the State 
                administering the State plan under part A; or
                    ``(B) a job provided to a participant by any other 
                employer for which all or part of the wages are paid by 
                the State.
A State may provide or subsidize under the program any job which the 
State determines to be appropriate.
    ``(f) Temporary Subsidized Job Creation.--A State that establishes 
a workfare program under this part may establish a program under this 
Act similar to the program operated by the State of Oregon known as 
`JOBS Plus'.
    ``(g) Work Supplementation Program.--
            ``(1) In general.--A State that establishes a workfare 
        program under this part may institute a work supplementation 
        program under which the State, to the extent it considers 
        appropriate, may reserve the sums that would otherwise be 
        payable to participants in the program as a community service 
        minimum wage and use the sums instead for the purpose of 
        providing and subsidizing private sector jobs for the 
        participants.
            ``(2) Employer agreement.--An employer who provides a 
        private sector job to a participant under paragraph (1) shall 
        agree to provide to the participant an amount in wages equal to 
        the poverty threshold for a family of three.
    ``(h) Job Search Requirement.--The State shall require each 
participant to spend a minimum of 5 hours per week on activities 
related to securing unsubsidized full-time employment in the private 
sector.
    ``(i) Use of Placement Companies.--A State that establishes a 
workfare program under this part may enter into contracts in accordance 
with section 483 with private companies (whether operated for profit or 
not for profit) for the placement of participants in the program in 
positions of full-time employment, preferably in the private sector, 
for wages sufficient to eliminate the need of such participants for 
cash assistance.
    ``(j) Maximum of 3 Community Service Jobs.--A program participant 
may not receive more than 3 community service jobs under the program.

                ``PART H--JOB PLACEMENT VOUCHER PROGRAM

``SEC. 495. JOB PLACEMENT VOUCHER PROGRAM.

    ``A State that is not operating a workfare program under part G 
shall establish and operate a job placement voucher program under this 
part that meets the following requirements:
            ``(1) The program shall offer each program participant a 
        voucher which the participant may use to obtain employment in 
        the private sector.
            ``(2) An employer who receives a voucher issued under the 
        program from an individual may redeem the voucher at any time 
        after the individual has been employed by the employer for 6 
        months, unless another employee of the employer was displaced 
        by the employment of the individual.
            ``(3) Upon presentation of a voucher by an employer to the 
        State agency responsible for the administration of the program, 
        the State agency shall pay to the employer an amount equal to 
        50 percent of the total amount of assistance provided under the 
        State plan under part A to the family of which the individual 
        is a member for the most recent 12 months for which the family 
        was eligible for such assistance.''.
    (b) Conforming Amendments.--
            (1) Section 1108 of the Social Security Act (42 U.S.C. 
        1308) is amended--
                    (A) in subsection (a), by striking ``or, in the 
                case of part A of title IV, section 403(k)''; and
                    (B) in subsection (d), by striking ``(exclusive of 
                any amounts on account of services and items to which, 
                in the case of part A of such title, section 403(k) 
                applies)''.
            (2) Section 1902(a)(10)(A)(i)(I) of that Act (42 U.S.C. 
        1396a(a)(19)(A)(i)(I)) is amended--
                    (A) by striking ``402(a)(37), 406(h), or''; and
                    (B) by striking ``482(e)(6)'' and inserting 
                ``486(f)''.
            (3) Section 1928(a)(1) of that Act (42 U.S.C. 1396s(a)(1)) 
        is amended by striking ``482(e)(6)'' and inserting ``486(f)''.
    (c) Intent of the Congress.--The Congress intends for State 
activities under section 484 of the Social Security Act (as added by 
section 121(a) of this Act) to emphasize the use of the funds that 
would otherwise be used to provide individuals with assistance under 
part A of title IV of the Social Security Act to subsidize the wages of 
such individuals in temporary jobs.
    (d) Sense of the Congress.--It is the sense of the Congress that 
States should focus the resources of the program under part F of title 
IV of the Social Security Act, as amended by this subtitle, on 
individuals who have not attained 25 years of age in order to break the 
cycle of welfare dependency.
    (e) Effective Date.--This section takes effect October 1, 1996.

SEC. 122. REGULATIONS.

    The Secretary of Health and Human Services shall prescribe such 
regulations as may be necessary to implement the amendments made by 
this subtitle.

SEC. 123. APPLICABILITY TO STATES.

    (a) State Option To Accelerate Applicability.--If a State formally 
notifies the Secretary of Health and Human Services that the State 
desires to accelerate the applicability to the State of the amendments 
made by this title, the amendments shall apply to the State on and 
after such earlier date as the State may select; provided, that only 
funding otherwise provided for grants to States to carry out part F of 
title IV, as that part was in effect on January 1, 1996, shall be 
available to States to carry out parts F, G, and H of title IV before 
October 1, 1996.
    (b) State Option To Delay Applicability Until Waivers Expire.--The 
amendments made by this subtitle, other than participation requirements 
under sections 481(a)(5)(B), 481(a)(6), and 488 of the Social Security 
Act, shall not apply to areas in a State with respect to which there is 
in effect a waiver issued under section 1115 of that Act for the State 
program established under part A of title IV of that Act, until the 
waiver expires, if the State formally notifies the Secretary of Health 
and Human Services that the State desires to so delay such effective 
date and the waiver's terms and conditions have been modified so that 
all cost comparisons reflect the amendments made to part A of title IV 
of that Act. States are subject to the funding provisions under parts 
A, F, G, and H and the participation requirements under sections 
481(a)(5)(B), 481(a)(6), and 488 of that Act.

SEC. 124. ONE TIME INCREASES IN WORK FIRST PROGRAM FUNDS.

    To the extent that the Congressional Budget Office estimates that 
amendments made by subtitle A of this title increase the sum of 
payments to States under section 413(a)(1) of the Social Security Act, 
title XIX of that Act, and the Food Stamp Act of 1977 (excluding: (1) 
any effects from limitations on funding for activities authorized under 
section 413(a)(3) of the Social Security Act, as amended by this Act, 
(2) any savings resulting from the State option under section 
402(d)(1)(C) of the Social Security Act, as amended by this Act, and 
(3) any savings resulting from section 416 of the Social Security Act, 
as amended by this Act) by less than:
            $170,000,000 in FY 1997,
            $405,000,000 in FY 1998,
            $635,000,000 in FY 1999,
            $785,000,000 in FY 2000,
            $775,000,000 in FY 2001 or,
            $825,000,000 in FY 2002
then the amount(s) in section 413(a)(2)(C) of the Social Security Act 
for such fiscal year(s) shall be adjusted upward by such difference(s).

               Subtitle D--Pregnancy And Family Stability

SEC. 131. SUPERVISED LIVING ARRANGEMENTS FOR MINORS.

    (a) In General.--Section 402(c) of the Social Security Act, as 
amended by section 102 of this Act, is amended by adding at the end the 
following:
            ``(8) Supervised living arrangements for minors.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), in the case of any individual who is 
                under age 18 and has never married, and who has a needy 
                child in his or her care (or is pregnant and is 
                eligible for temporary employment assistance under the 
                State plan)--
                            ``(i) such individual may receive such 
                        assistance for the individual and such child 
                        (or for herself in the case of a pregnant 
                        woman) only if such individual and child (or 
                        such pregnant woman) reside in a place of 
                        residence maintained by a parent, legal 
                        guardian, or other adult relative of such 
                        individual as such parent's, guardian's, or 
                        adult relative's own home; and
                            ``(ii) such assistance (where possible) 
                        shall be provided to the parent, legal 
                        guardian, or other adult relative on behalf of 
                        such individual and child; and
                    ``(B) Alternative appropriate arrangements.--
                            (i) In the case of an individual described 
                        in clause (ii)--
                                    ``(I) the State agency shall assist 
                                such individual in locating an 
                                appropriate adult-supervised supportive 
                                living arrangement, taking into 
                                consideration the needs and concerns of 
                                the individual, unless the State agency 
                                determines that the individual's 
                                current living arrangement is 
                                appropriate, and thereafter shall 
                                require that the individual (and child, 
                                if any) reside in such living 
                                arrangement as a condition of the 
                                continued receipt of assistance under 
                                the plan (or in an alternative 
                                appropriate arrangement, should 
                                circumstances change and the current 
                                arrangement cease to be appropriate), 
                                or
                                    ``(II) if the State agency is 
                                unable, after making diligent efforts, 
                                to locate any such appropriate living 
                                arrangement, the State agency shall 
                                provide for comprehensive case 
                                management, monitoring, and other 
                                social services consistent with the 
                                best interests of the individual (and 
                                child) while living independently (as 
                                determined by the State agency).
                            ``(ii) For purposes of clause (i), an 
                        individual is described in this clause if--
                                    ``(I) such individual has no parent 
                                or legal guardian who is living and 
                                whose whereabouts are known;
                                    ``(II) no living parent or legal 
                                guardian of such individual allows the 
                                individual to live in the home of such 
                                parent or guardian;
                                    ``(III) the State agency determines 
                                that the physical or emotional health 
                                of such individual or any needy child 
                                of the individual would be jeopardized 
                                if such individual and such needy child 
                                lived in the same residence with such 
                                individual's own parent or legal 
                                guardian; or
                                    ``(IV) the State agency otherwise 
                                determines (in accordance with 
                                regulations issued by the Secretary) 
                                that it is in the best interest of the 
                                needy child to waive the requirement of 
                                subparagraph (A) with respect to such 
                                individual.''.
    (b) Effective Date.--The amendment made by subsection (a) takes 
effect in the same manner as the amendment made by section 102 takes 
effect.

SEC. 132. NATIONAL CLEARINGHOUSE ON ADOLESCENT PREGNANCY.

    (a) In General.--Title XX of the Social Security Act (42 U.S.C. 
1397-1397f), is amended by adding at the end the following:

``SEC. 2008. NATIONAL CLEARINGHOUSE ON ADOLESCENT PREGNANCY.

    ``(a) National Clearinghouse on Adolescent Pregnancy.--
            ``(1) Establishment.--The Secretary shall establish, 
        through grant or contract, a national center for the collection 
        and provision of programmatic information and technical 
        assistance that relates to adolescent pregnancy prevention 
        programs, to be known as the `National Clearinghouse on 
        Adolescent Pregnancy Prevention Programs'.
            ``(2) Functions.--The national center established under 
        paragraph (1) shall serve as a national information and data 
        clearinghouse, and as a training, technical assistance, and 
        material development source for adolescent pregnancy prevention 
        programs including, but not limited to, abstinence programs. 
        Such center shall--
                    ``(A) develop and maintain a system for 
                disseminating information on all types of adolescent 
                pregnancy prevention programs, including abstinence 
                programs, and on the state of adolescent pregnancy 
                prevention program development, including information 
                concerning the most effective model programs;
                    ``(B) develop and sponsor a variety of training 
                institutes and curricula for adolescent pregnancy 
                prevention program staff, including abstinence 
                education;
                    ``(C) identify model programs representing the 
                various types of adolescent pregnancy prevention 
                programs;
                    ``(D) develop technical assistance materials and 
                activities to assist other entities in establishing and 
                improving adolescent pregnancy prevention programs, 
                including abstinence education;
                    ``(E) develop networks of adolescent pregnancy 
                prevention programs for the purpose of sharing and 
                disseminating information; and
                    ``(F) conduct such other activities as the 
                responsible Federal officials find will assist in 
                developing and carrying out programs or activities to 
                reduce adolescent pregnancy.
    ``(b) Funding.--There are authorized to be appropriated $6 million 
for each of fiscal years 1997 through 2001 to carry out this 
section.''.
    (b) Effective Date.--The amendments made by this section become 
effective October 1, 1996.

SEC. 133. REQUIRED COMPLETION OF HIGH SCHOOL OR OTHER TRAINING FOR 
              TEENAGE PARENTS.

    (a) In General.--Section 403(b)(1)(D), as added by section 102 of 
this Act, is amended--
            (1) by inserting ``(i)'' after ``(D)''; and
            (2) by adding at the end the following:
                    ``(ii) in the case of a client who is a custodial 
                or expectant parent who is under age 18 (or age 19, at 
                the option of the State), has not successfully 
                completed a high school education (or its equivalent), 
                and is required to participate in the Work First 
                program (including an individual who would otherwise be 
                exempt from participation in the program), shall 
                provide that--
                            ``(I) such parent shall participate in--
                                    ``(aa) educational activities 
                                directed toward the attainment of a 
                                high school diploma or its equivalent 
                                on a full-time (as defined by the 
                                educational provider) basis; or
                                    ``(bb) an alternative educational 
                                or training program on a full-time (as 
                                defined by the provider) basis; and
                            ``(II) child care will be provided in 
                        accordance with section 114 with respect to the 
                        family under the Child Care and Development 
                        Block Grant Act of 1990.''.
    (b) State Option To Provide Additional Incentives and Penalties To 
Encourage Teen Parents To Complete High School and Participate in 
Parenting Activities.--
            (1) State plan.--Section 403(b)(1)(D), as amended by 
        subsection (a) of this section, is amended further by adding at 
        the end the following:
                            ``(iii) at the option of the State, may 
                        provide that the client who is a custodial 
                        parent or pregnant woman who is under age 19 
                        (or age 21, at the option of the State) shall 
                        participate in a program of monetary incentives 
                        and penalties which--
                                    ``(I) may, at the option of the 
                                State, require full-time participation 
                                by such custodial parent or pregnant 
                                woman in secondary school or equivalent 
                                educational activities, or 
                                participation in a course or program 
                                leading to a skills certificate found 
                                appropriate by the State agency or 
                                parenting education activities (or any 
                                combination of such activities and 
                                secondary education);
                                    ``(II) shall require that the needs 
                                of such custodial parent or pregnant 
                                woman be reviewed and the program 
                                assure that, either in the initial 
                                development or revision of such 
                                individual's personal responsibility 
                                agreement, there will be included a 
                                description of the services that will 
                                be provided to the client and the way 
                                in which the program and service 
                                providers will coordinate with the 
                                educational or skills training 
activities in which the client is participating;
                                    ``(III) shall provide monetary 
                                incentives (to be treated as assistance 
                                under the State plan) for more than 
                                minimally acceptable performance of 
                                required educational activities;
                                    ``(IV) shall provide penalties 
                                (which may be those required by section 
                                402(c)(1)(C) or, with the approval of 
                                the Secretary, other monetary penalties 
                                that the State finds will better 
                                achieve the objectives of the program) 
                                for less than minimally acceptable 
                                performance of required activities;
                                    ``(V) shall provide that when a 
                                monetary incentive is payable because 
                                of the more than minimally acceptable 
                                performance of required educational 
                                activities by a custodial parent or 
                                pregnant woman, the incentive be paid 
                                directly to the individual, regardless 
                                of whether the State agency makes 
                                payment of assistance under the State 
                                plan directly to the individual; and
                                    ``(VI) for purposes of any other 
                                Federal or Federally assisted program 
                                based on need, shall not consider any 
                                monetary incentive paid under the State 
                                plan as income in determining a 
                                family's eligibility for or amount of 
                                benefits under such program, and if 
                                assistance is reduced by reason of a 
                                penalty under this clause, such other 
                                program shall treat the family involved 
                                as if no such penalty has been 
                                applied.''.
    (c) Effective Date.--The amendments made by this section take 
effect in the same manner as the amendment made by section 102 takes 
effect.

SEC. 134. SECOND CHANCE HOMES.

    (a) In General.--Section 402(c) of the Social Security Act, as 
amended by sections 102 and 131 of this Act, is amended by adding after 
paragraph (8):
            ``(9) Second chance homes.--
                    ``(A) In general.--States may use funds available 
                under section 413(a)(2)(B) for the establishment, 
                operation, and support of second chance group homes for 
                custodial parents under age 18 (or age 19, at the 
                option of the State) and their children.
                    ``(B) Definition of second chance home.--For 
                purposes of this section, the term `second chance home' 
                means an entity that provides custodial parents under 
                age 18 (or age 19, at the option of the State) and 
                their children with a supportive and supervised living 
                arrangement in which the parents are required to learn 
                parenting skills, including child development, family 
                budgeting, health and nutrition, and other skills to 
                promote their long-term economic independence and the 
                well-being of their children. A second chance home also 
                may serve as a network center for other supportive 
                services that are available in the community.
                    ``(C) Technical assistance.--A State may use a 
                portion of the funds described in subparagraph (A) to 
                purchase technical assistance from public or private 
                entities if the State determines that such assistance 
                is required in developing, implementing, or 
                administering the program funded under this section.
                    ``(D) Local involvement.--Each State shall seek 
                local involvement from the community in any area in 
                which a second chance home receiving funds to be 
                expended under this paragraph is to be established. 
                When providing funds to be expended under this 
                paragraph, each State shall evaluate the community's 
                commitment to the establishment and planning of the 
                home.
                    ``(E) Limitations on the use of funds.--
                            ``(i) Construction.--Except as provided in 
                        clause (ii), expenditures authorized under this 
                        paragraph and section 413(a)(2)(B)(i)(V) may 
                        not be used by the State, or any person with 
                        whom the State makes arrangements to carry out 
                        the purposes of this section, for the purchase 
                        or improvement of land, or the purchase, 
                        construction, or permanent improvement (other 
                        than minor remodeling) of any building or other 
                        facility.
                            ``(ii) Waiver.--The Secretary may waive the 
                        limitation in clause (i) upon the State's 
                        request if the Secretary finds that the request 
                        describes extraordinary circumstances to 
                        justify such a waiver and that permitting the 
                        waiver would contribute to the State's ability 
                        to carry out the purposes of this section.
                    ``(F) Receipt of payments by second chance homes.--
                Section 402(c)(8)(A)(ii) (as added by section 131(a) of 
                the Work First and Personal Responsibility Act of 
                1996), is amended by striking `or other adult relative' 
                and inserting `other adult relative, or second chance 
                home described under paragraph (9) of this 
                subsection'.''.
    (b) Funding.--Section 413(a)(2)(B)(i) of the Social Security Act, 
as added by section 102 of this Act, is amended by adding at after 
subclause (IV) the following new subclause:
                            ``(V) Second chance homes.--Costs of 
                        establishing and operating Second Chance Homes 
                        under section 402(a)(9).''.
    (c) Recommendations on Use of Government Surplus Property.--Not 
later than 6 months after the date of the enactment of this Act, after 
consulting with the Secretary of Defense, the Secretary of Housing and 
Urban Development, and the Administrator of the General Services 
Administration, the Secretary of Health and Human Services shall submit 
recommendations to the Congress on the extent to which surplus 
properties of the United States Government may be used for the 
establishment of second chance homes receiving funds under section 413 
of the Social Security Act, as amended by this section.
    (d) Effective Date.--The amendments made by subsections (a) and (b) 
take effect October 1, 1996.

                  TITLE II--CHILD SUPPORT ENFORCEMENT

     Subtitle A--Eligibility for Services; Distribution of Payments

SEC. 201. STATE OBLIGATION TO PROVIDE CHILD SUPPORT ENFORCEMENT 
              SERVICES.

    (a) State Plan Requirements.--Section 454 (42 U.S.C. 654) is 
amended--
            (1) by striking paragraph (4) and inserting the following 
        new paragraph:
            ``(4) provide that the State will--
                    ``(A) provide services relating to the 
                establishment of paternity or the establishment, 
                modification, or enforcement of child support 
                obligations, as appropriate, under the plan with 
                respect to--
                            ``(i) each child for whom
                                    ``(I) assistance is provided under 
                                the State program funded under part A 
                                of this title,
                                    ``(II) benefits or services for 
                                foster care maintenance and adoption 
                                assistance are provided under the State 
                                program funded under part B of this 
                                title, or
                                    ``(III) medical assistance is 
                                provided under the State plan approved 
                                under title XIX,
                        unless the State agency administering the plan 
                        determines (in accordance with paragraph (29)) 
                        that it is against the best interests of the 
                        child to do so; and
                            ``(ii) any other child, if an individual 
                        applies for such services with respect to the 
                        child; and
                    ``(B) enforce any support obligation established 
                with respect to--
                            ``(i) a child with respect to whom the 
                        State provides services under the plan; or
                            ``(ii) the custodial parent of such a 
                        child;''; and
            (2) in paragraph (6)--
                    (A) by striking ``provide that'' and inserting 
                ``provide that--'';
                    (B) by striking subparagraph (A) and inserting the 
                following new subparagraph:
                    ``(A) services under the plan shall be made 
                available to residents of other States on the same 
                terms as to residents of the State submitting the 
                plan;'';
                    (C) in subparagraph (B), by inserting ``on 
                individuals not receiving assistance under any State 
                program funded under part A'' after ``such services 
                shall be imposed'';
                    (D) in each of subparagraphs (B), (C), (D), and 
                (E)--
                            (i) by indenting the subparagraph in the 
                        same manner as, and aligning the left margin of 
                        the subparagraph with the left margin of, the 
                        matter inserted by subparagraph (B) of this 
                        paragraph; and
                            (ii) by striking the final comma and 
                        inserting a semicolon; and
                    (E) in subparagraph (E), by indenting each of 
                clauses (i) and (ii) 2 additional ems.
    (b) Continuation of Services for Families Ceasing to Receive 
Assistance Under the State Program Funded Under Part A.--Section 454 
(42 U.S.C. 654) is amended--
            (1) by striking ``and'' at the end of paragraph (23);
            (2) by striking the period at the end of paragraph (24) and 
        inserting ``; and''; and
            (3) by adding after paragraph (24) the following new 
        paragraph:
            ``(25) provide that if a family with respect to which 
        services are provided under the plan ceases to receive 
        assistance under the State program funded under part A, the 
        State shall provide appropriate notice to the family and 
        continue to provide such services, subject to the same 
        conditions and on the same basis as in the case of other 
        individuals to whom services are furnished under the plan, 
        except that an application or other request to continue 
        services shall not be required of such a family and paragraph 
        (6)(B) shall not apply to the family.''.
    (c) Conforming Amendments.--
            (1) Section 452(b) (42 U.S.C. 652(b)) is amended by 
        striking ``454(6)'' and inserting ``454(4)''.
            (2) Section 452(g)(2)(A) (42 U.S.C. 652(g)(2)(A)) is 
        amended by striking ``454(6)'' each place it appears and 
        inserting ``454(4)(A)(ii)''.
            (3) Section 466(a)(3)(B) (42 U.S.C. 666(a)(3)(B)) is 
        amended by striking ``in the case of overdue support which a 
        State has agreed to collect under section 454(6)'' and 
        inserting ``in any other case''.
            (4) Section 466(e) (42 U.S.C. 666(e)) is amended by 
        striking ``paragraph (4) or (6) of section 454'' and inserting 
        ``section 454(4)''.

SEC. 202. DISTRIBUTION OF PAYMENTS.

    (a) Distributions Through State Child Support Enforcement Agency to 
Former Assistance Recipients.--Section 454(5) (42 U.S.C. 654(5)) is 
amended--
            (1) in subparagraph (A)--
                    (A) by striking ``section 402(a)(26) is 
                effective,'' and inserting ``section 403(b)(1)(E)(i) is 
                effective, except as otherwise specifically provided in 
                section 464 or 466(a)(3),''; and
                    (B) by striking ``except that'' and all that 
                follows through the semicolon; and
            (2) in subparagraph (B), by striking ``, except'' and all 
        that follows through ``medical assistance''.
    (b) Distribution to a Family Currently Receiving Temporary 
Employment Assistance.--Section 457 (42 U.S.C. 657) is amended--
            (1) by striking subsection (a) and redesignating subsection 
        (b) as subsection (a);
            (2) in subsection (a) (as so redesignated)--
                    (A) in the matter preceding paragraph (2), to read 
                as follows:
    ``(a) In the Case of a Family Receiving TEA.--Amounts subject to 
section 1912 collected under this part during any month as support of a 
child who is receiving assistance under part A (or a parent or 
caretaker relative of such a child) shall (except in the case of a 
State exercising the option under subsection (b)) be distributed as 
follows:
            ``(1) an amount equal to the amount that will be 
        disregarded pursuant to section 402(d)(2)(C) shall be taken 
        from each of--
                    ``(A) the amounts received in a month which 
                represent payments for that month; and
                    ``(B) the amounts received in a month which 
                represent payments for a prior month which were made by 
                the absent parent in that prior month;
        and shall be paid to the family without affecting its 
        eligibility for assistance or decreasing any amount otherwise 
        payable as assistance to such family during such month;'';
                    (B) in paragraph (4), by striking ``or (B)'' and 
                all that follows through the period and inserting ``; 
                then (B) from any remainder, amounts equal to 
                arrearages of such support obligations assigned, 
                pursuant to part A, to any other State or States shall 
                be paid to such other State or States and used to pay 
                any such arrearages (with appropriate reimbursement of 
                the Federal Government to the extent of its 
                participation in the financing); and then (C) any 
                remainder shall be paid to the family.''; and
            (3) by inserting after subsection (a) (as so redesignated) 
        the following new subsection:
    ``(b) Alternative Distribution in Case of Family Receiving TEA.--In 
the case of a State electing the option under this subsection, amounts 
collected as described in subsection (a) that are not subject to 
section 1912 shall be distributed as follows:
            ``(1) an amount equal to the amount that will be 
        disregarded pursuant to section 402(d)(2)(C) shall be taken 
        from each of--
                    ``(A) the amounts received in a month which 
                represent payments for that month; and
                    ``(B) the amounts received in a month which 
                represent payments for a prior month which were made by 
                the absent parent in that prior month;
        and shall be paid to the family without affecting its 
        eligibility for assistance or decreasing any amount otherwise 
        payable as assistance to such family during such month;
            ``(2) second, from any remainder, amounts equal to the 
        balance of support owed for the current month shall be paid to 
        the family;
            ``(3) third, from any remainder, amounts equal to 
        arrearages of such support obligations assigned, pursuant to 
        part A, to the State making the collection shall be retained 
        and used by such State to pay any such arrearages (with 
        appropriate reimbursement of the Federal Government to the 
        extent of its participation in the financing);
            ``(4) fourth, from any remainder, amounts equal to 
        arrearages of such support obligations assigned, pursuant to 
        part A, to any other State or States shall be paid to such 
        other State or States and used to pay any such arrearages (with 
        appropriate reimbursement of the Federal Government to the 
        extent of its participation in the financing); and
            ``(5) fifth, any remainder shall be paid to the family.''.
    (c) Distribution to a Family Not Receiving TEA.--Section 457(c) (42 
U.S.C.657(c)) is amended to read as follows:
    ``(c) Distributions in Case of Family Not Receiving TEA.--Amounts 
that are not subject to section 1912 collected by a State agency under 
this part during any month as support of a child who is not receiving 
assistance under part A (or of a parent or caretaker relative of such a 
child) shall (subject to the remaining provisions of this section) be 
distributed as follows:
            ``(1) first, amounts equal to the total of such support 
        owed for such month shall be paid to the family;
            ``(2) second, from any remainder, amounts equal to 
        arrearages of such support obligations that have not been 
        assigned to the State for months during which such child did 
        not receive assistance under part A shall be paid to the 
        family;
            ``(3) third, from any remainder, amounts equal to 
        arrearages of such support obligations assigned to the State 
        making the collection pursuant to part A shall be retained and 
        used by such State to pay any such arrearages (with appropriate 
        reimbursement of the Federal Government to the extent of its 
        participation in the financing); and
            ``(4) fourth, from any remainder, amounts equal to 
        arrearages of such support obligations assigned to any other 
        State pursuant to part A shall be paid to such other State or 
        States, and used to pay such arrearages, in the order in which 
        such arrearages accrued (with appropriate reimbursement of the 
        Federal Government to the extent of its participation in the 
        financing).''.
    (d) Distribution to a Child Receiving Assistance Under Title IV-
E.--Section 457(d) (42 U.S.C. 657(d)) is amended, in the matter 
preceding paragraph (1), by striking ``Notwithstanding the preceding 
provisions of this section, amounts'' and inserting the following:
    ``(d) Distributions in the Case of a Child Receiving Assistance 
Under Title IV-E.--Amounts''.
    (e) Regulations.--The Secretary of Health and Human Services shall 
promulgate regulations under part A of title IV of the Social Security 
Act, establishing standards applicable to the States electing the 
alternative formula under section 457(b) of such Act for distribution 
of collections on behalf of families receiving temporary employment 
assistance, designed to minimize irregular monthly payments to such 
families.
    (f) Conforming Amendments Concerning Collection of Child Support 
Arrearages Through Income Tax Refund Offset.--
            (1) Section 6402(c) of the Internal Revenue Code of 1986 is 
        amended by striking the third sentence after ``past due support 
        has been paid to the State''.
            (2) Section 6402(d)(2) of such Code is amended in the first 
        sentence by striking ``after'' and inserting ``before'' and by 
        striking ``with respect to past-due support collected pursuant 
        to an assignment under section 402(a)(26) of the Social 
        Security Act and''.
            (3) Section 464(a) (42 U.S.C. 664) is amended--
                    (A) by striking ``(a)'' and inserting ``(a) Offset 
                Authorized.--'';
                    (B) in paragraph (1)--
                            (i) in the first sentence, by striking 
                        ``which has been assigned to such State 
                        pursuant to section 402(a)(26) or section 
                        471(a)(17)''; and
                            (ii) in the second sentence, by striking 
                        ``in accordance with section 457(b)(4) or 
                        (d)(3)'' and inserting ``as provided in 
                        paragraph (2)'';
                    (C) by amending paragraph (2) to read as follows:
            ``(2) The State agency shall distribute amounts paid by the 
        Secretary of the Treasury pursuant to paragraph (1)--
                    ``(A) in accordance with section 457(a)(4) or 
                (d)(3), in the case of past-due support assigned to a 
                State under part A of title IV of the Social Security 
                Act; and
                    ``(B) to or on behalf of the child to whom the 
                support was owed, in the case of past-due support not 
                so assigned.''; and
                    (D) in paragraph (3)--
                            (i) by striking ``or (2)'' each place it 
                        appears; and
                            (ii) in subparagraph (B), by striking 
                        ``under paragraph (2)'' and inserting ``on 
                        account of past-due support described in 
                        paragraph (2)(B)'';
            (4) Section 464(b) is amended--
                    (A) by striking ``(b)(1)'' and inserting ``(b) 
                Regulations.--''; and
                    (B) by striking paragraph (2).
            (5) Section 464(c) is amended--
                    (A) by striking ``(c)(1) Except as provided in 
                paragraph (2), as'' and inserting ``(c) Definition.--
                As''; and
                    (B) by striking paragraphs (2) and (3).
    (g) Clerical Amendments.--Section 454 (42 U.S.C. 654) is amended--
            (1) in paragraph (11)--
                    (A) by striking ``(11)'' and inserting ``(11)(A)''; 
                and
                    (B) by inserting after the semicolon ``and''; and
            (2) by redesignating paragraph (12) as subparagraph (B) of 
        paragraph (11).
    (h) Effective Dates.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section become 
        effective on October 1, 1996.
            (2) Family not receiving tea.--The amendments made by 
        subsections (c) and (f)(3), (4), and (5) become effective on 
        October 1, 1999.
            (3) Special rules.--
                    (A) Applicability.--A State may elect to have the 
                amendments made by any subsection of this section 
                become effective only with respect to child support 
                cases beginning on or after the effective date of such 
                subsection.
                    (B) Delayed implementation.--A State may elect to 
                have the amendments made by this section (other than 
                subsections (c)and (f)) become effective on a date 
                later than October 1, 1996, which date shall coincide 
                with the operation of the single statewide automated 
                data processing and information retrieval system 
                required by section 454A of the Social Security Act (as 
                added by section 244(a)(2) of this Act) and the State 
                disbursement unit required by section 454B of the 
                Social Security Act (as added by section 212(b) of this 
                Act).

SEC. 203. PRIVACY SAFEGUARDS.

    (a) State Plan Requirement.--Section 454 (42 U.S.C. 654), as 
amended by section 201(b) of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (24);
            (2) by striking the period at the end of paragraph (25) and 
        inserting ``; and''; and
            (3) by adding after paragraph (25) the following new 
        paragraph:
            ``(26) will have in effect safeguards, applicable to all 
        confidential information handled by the State agency, that are 
        designed to protect the privacy rights of the parties, 
        including--
                    ``(A) safeguards against unauthorized use or 
                disclosure of information relating to proceedings or 
                actions to establish paternity, or to establish or 
                enforce support;
                    ``(B) prohibitions against the release of 
                information on the whereabouts of one party to another 
                party against whom a protective order with respect to 
                the former party has been entered; and
                    ``(C) prohibitions against the release of 
                information on the whereabouts of one party to another 
                party if the State has reason to believe that the 
                release of the information may result in physical or 
                emotional harm to the former party.''.
    (b) Effective Date.--The amendment made by subsection (a) becomes 
effective on October 1, 1997.

SEC. 204. RIGHTS TO NOTIFICATION.

    (a) In General.--Section 454 (42 U.S.C. 654), as amended by section 
202(g) of this Act, is amended by inserting after paragraph (11) the 
following new paragraph:
            ``(12) provide for the establishment of procedures to 
        require the State to provide individuals who are applying for 
        or receiving services under the State plan, or who are parties 
        to cases in which services are being provided under the State 
        plan--
                    ``(A) with notice of all proceedings in which 
                support obligations might be established or modified; 
                and
                    ``(B) with a copy of any order establishing or 
                modifying a child support obligation, or (in the case 
                of a petition for modification) a notice of 
                determination that there should be no change in the 
                amount of the child support award, within 14 days after 
                issuance of such order or determination;''.
    (b) Effective Date.--The amendment made by subsection (a) becomes 
effective on October 1, 1997.

                  Subtitle B--Locate and Case Tracking

SEC. 211. STATE CASE REGISTRY.

    Section 454A, as added by section 244(a)(2) of this Act, is amended 
by adding at the end the following new subsections:
    ``(e) State Case Registry.--
            ``(1) Contents.--The automated system required by this 
        section shall include a registry (which shall be known as the 
        `State case registry') that contains records with respect to--
                    ``(A) each case in which services are being 
                provided by the State agency under the State plan 
                approved under this part; and
                    ``(B) each support order established or modified in 
                the State on or after October 1, 1998.
            ``(2) Linking of local registries.--The State case registry 
        may be established by linking local case registries of support 
        orders through an automated information network, subject to 
        this section.
            ``(3) Use of standardized data elements.--Such records 
        shall use standardized data elements for both parents (such as 
        names, social security numbers and other uniform identification 
        numbers, dates of birth, and case identification numbers), and 
        contain such other information (such as information on case 
        status) as the Secretary may require.
            ``(4) Payment records.--Each case record in the State case 
        registry with respect to which services are being provided 
        under the State plan approved under this part and with respect 
        to which a support order has been established shall include a 
        record of--
                    ``(A) the amount of monthly (or other periodic) 
                support owed under the order, and other amounts 
                (including arrearages, interest or late payment 
                penalties, and fees) due or overdue under the order;
                    ``(B) any amount described in subparagraph (A) that 
                has been collected;
                    ``(C) the distribution of such collected amounts;
                    ``(D) the birth date of any child for whom the 
                order requires the provision of support; and
                    ``(E) the amount of any lien imposed with respect 
                to the order pursuant to section 466(a)(4).
            ``(5) Updating and monitoring.--The State agency operating 
        the automated system required by this section shall promptly 
        establish and maintain, and regularly monitor, case records in 
        the State case registry with respect to which services are 
        being provided under the State plan approved under this part, 
        on the basis of--
                    ``(A) information on administrative actions and 
                administrative and judicial proceedings and orders 
                relating to paternity and support;
                    ``(B) information obtained from comparison with 
                Federal, State, or local sources of information;
                    ``(C) information on support collections and 
                distributions; and
                    ``(D) any other relevant information.
    ``(f) Information Comparisons and Other Disclosures of 
Information.--The State shall use the automated system required by this 
section to extract information from (at such times, and in such 
standardized format or formats, as may be required by the Secretary), 
to share and compare information with, and to receive information from, 
other data bases and information comparison services, in order to 
obtain (or provide) information necessary to enable the State agency 
(or the Secretary or other State or Federal agencies) to carry out this 
part, subject to section 6103 of the Internal Revenue Code of 1986. 
Such information comparison activities shall include the following:
            ``(1) Federal case registry of child support orders.--
        Furnishing to the Federal Case Registry of Child Support Orders 
        established under section 453(h) (and update as necessary, with 
        information including notice of expiration of orders) the 
        minimum amount of information on child support cases recorded 
        in the State case registry that is necessary to operate the 
        registry (as specified by the Secretary in regulations).
            ``(2) Federal parent locator service.--Exchanging 
        information with the Federal Parent Locator Service for the 
        purposes specified in section 453.
            ``(3) Temporary employment assistance and medicaid 
        agencies.--Exchanging information with State agencies (of the 
        State and of other States) administering programs under part A, 
        programs under State plans under title XIX, and other programs 
        designated by the Secretary, as necessary to perform State 
        agency responsibilities under this part and under such 
        programs.
            ``(4) Intrastate and interstate information comparisons.--
        Exchanging information with other agencies of the State, 
        agencies of other States, and interstate information networks, 
        as necessary and appropriate to carry out (or assist other 
States to carry out) the purposes of this part.''.

SEC. 212. COLLECTION AND DISBURSEMENT OF SUPPORT PAYMENTS.

    (a) State Plan Requirement.--Section 454 (42 U.S.C. 654), as 
amended by sections 201(b) and 203(a) of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (25);
            (2) by striking the period at the end of paragraph (26) and 
        inserting ``; and''; and
            (3) by adding after paragraph (26) the following new 
        paragraph:
            ``(27) provide that, on and after October 1, 1998, the 
        State agency will--
                    ``(A) operate a State disbursement unit in 
                accordance with section 454B; and
                    ``(B) have sufficient State staff (consisting of 
                State employees) and (at State option) contractors 
                reporting directly to the State agency to--
                            ``(i) monitor and enforce support 
                        collections through the unit in cases being 
                        enforced by the State pursuant to section 
                        454(4) (including carrying out the automated 
                        data processing responsibilities described in 
                        section 454A(g)); and
                            ``(ii) take the actions described in 
                        section 466(c)(1) in appropriate cases.''.
    (b) Establishment of State Disbursement Unit.--Part D of title IV 
(42 U.S.C. 651-669), as amended by section 245(a)(2) of this Act, is 
amended by inserting after section 454A the following new section:

``SEC. 454B. COLLECTION AND DISBURSEMENT OF SUPPORT PAYMENTS.

    ``(a) State Disbursement Unit.--
            ``(1) In general.--In order for a State to meet the 
        requirements of this section, the State agency must establish 
        and operate a unit (which shall be known as the `State 
        disbursement unit') for the collection and disbursement of 
        payments under support orders--
                    ``(A) in all cases being enforced by the State 
                pursuant to section 454(4); and
                    ``(B) in all cases not being enforced by the State 
                under this part in which the support order is initially 
                issued in the State on or after January 1, 1994, and in 
                which the wages of the absent parent are subject to 
                withholding pursuant to section 466(a)(8)(B).
            ``(2) Operation.--The State disbursement unit shall be 
        operated--
                    ``(A) directly by the State agency (or 2 or more 
                State agencies under a regional cooperative agreement), 
                or (to the extent appropriate) by a contractor 
                responsible directly to the State agency; and
                    ``(B) except in cases described in paragraph 
                (1)(B), in coordination with the automated system 
                established by the State pursuant to section 454A.
            ``(3) Linking of local disbursement units.--The State 
        disbursement unit may be established by linking local 
        disbursement units through an automated information network, 
        subject to this section, if the Secretary agrees that the 
        system will not cost more nor take more time to establish or 
        operate than a centralized system. In addition, employers shall 
        be given 1 location to which income withholding is sent.
    ``(b) Required Procedures.--The State disbursement unit shall use 
automated procedures, electronic processes, and computer-driven 
technology to the maximum extent feasible, efficient, and economical, 
for the collection and disbursement of support payments, including 
procedures--
            ``(1) for receipt of payments from parents, employers, and 
        other States, and for disbursements to custodial parents and 
        other obligees, the State agency, and the agencies of other 
        States;
            ``(2) for accurate identification of payments;
            ``(3) to ensure prompt disbursement of the custodial 
        parent's share of any payment; and
            ``(4) to furnish to any parent, upon request, timely 
        information on the current status of support payments under an 
        order requiring payments to be made by or to the parent.
    ``(c) Timing of Disbursements.--
            ``(1) In general.--Except as provided in paragraph (2), the 
        State disbursement unit shall distribute all amounts payable 
        under section 457(a) within 2 business days after receipt from 
        the employer or other source of periodic income, if sufficient 
        information identifying the payee is provided.
            ``(2) Permissive retention of arrearages.--The State 
        disbursement unit may delay the distribution of collections 
        toward arrearages until the resolution of any timely appeal 
        with respect to such arrearages.
    ``(d) Business Day Defined.--As used in this section, the term 
`business day' means a day on which State offices are open for regular 
business.''.
    (c) Use of Automated System.--Section 454A, as added by section 
245(a)(2) and as amended by section 211 of this Act, is amended by 
adding at the end the following new subsection:
    ``(g) Collection and Distribution of Support Payments.--
            ``(1) In general.--The State shall use the automated system 
        required by this section, to the maximum extent feasible, to 
        assist and facilitate the collection and disbursement of 
        support payments through the State disbursement unit operated 
        under section 454B, through the performance of functions, 
        including, at a minimum--
                    ``(A) transmission of orders and notices to 
                employers (and other debtors) for the withholding of 
                wages and other income--
                            ``(i) within 2 business days after receipt 
                        from a court, another State, an employer, the 
                        Federal Parent Locator Service, or another 
source recognized by the State of notice of, and the income source 
subject to, such withholding; and
                            ``(ii) using uniform formats prescribed by 
                        the Secretary;
                    ``(B) ongoing monitoring to promptly identify 
                failures to make timely payment of support; and
                    ``(C) automatic use of enforcement procedures 
                (including procedures authorized pursuant to section 
                466(c)) if payments are not timely made.
            ``(2) Business day defined.--As used in paragraph (1), the 
        term `business day' means a day on which State offices are open 
        for regular business.''.
    (d) Effective Date.--The amendments made by this section become 
effective on October 1, 1998.

SEC. 213. STATE DIRECTORY OF NEW HIRES.

    (a) State Plan Requirement.--Section 454 (42 U.S.C. 654), as 
amended by sections 201(b), 203(a) and 212(a) of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (26);
            (2) by striking the period at the end of paragraph (27) and 
        inserting ``; and''; and
            (3) by adding after paragraph (27) the following new 
        paragraph:
            ``(28) provide that, on and after October 1, 1997, the 
        State will operate a State Directory of New Hires in accordance 
        with section 453A.''.
    (b) State Directory of New Hires.--Part D of title IV (42 U.S.C. 
651-669) is amended by inserting after section 453 the following new 
section:

``SEC. 453A. STATE DIRECTORY OF NEW HIRES.

    ``(a) Establishment.--
            ``(1) In general.--
                    ``(A) Requirement for states that have no 
                directory.--Except as provided in subparagraph (B), not 
                later than October 1, 1997, each State shall establish 
                an automated directory (to be known as the `State 
                Directory of New Hires') which shall contain 
                information supplied in accordance with subsection (b) 
                by employers on each newly hired employee.
                    ``(B) States with new hire reporting in 
                existence.--A State which has a new hire reporting law 
                in existence on the date of the enactment of this 
                section may continue to operate under the State law, 
                but the State must meet the requirements of this 
                section (other than subsection (f)) not later than 
                October 1, 1997.
            ``(2) Definitions.--As used in this section:
                    ``(A) Employee.--The term `employee'--
                            ``(i) means an individual who is an 
                        employee within the meaning of chapter 24 of 
                        the Internal Revenue Code of 1986; and
                            ``(ii) does not include an employee of a 
                        Federal or State agency performing intelligence 
                        or counterintelligence functions, if the head 
                        of such agency has determined that reporting 
                        pursuant to paragraph (1) with respect to the 
                        employee could endanger the safety of the 
                        employee or compromise an ongoing investigation 
                        or intelligence mission.
                    ``(B) Employer.--
                            ``(i) In general.--The term `employer' has 
                        the meaning given such term in section 3401(d) 
                        of the Internal Revenue Code of 1996 and 
                        includes any governmental entity and any labor 
                        organization.
                            ``(ii) Labor organization.--The term `labor 
                        organization' has the meaning given such term 
                        in section 2(5) of the National Labor Relations 
                        Act, and includes any entity (also known as a 
                        `hiring hall') which is used by the 
                        organization and an employer to carry out 
                        requirements described in section 8(f)(3) of 
                        such Act of an agreement between the 
                        organization and the employer.
    ``(b) Employer Information.--
            ``(1) Reporting requirement.--
                    ``(A) In general.--Except as provided in 
                subparagraphs (B) and (C), each employer shall furnish 
                to the Directory of New Hires of the State in which a 
                newly hired employee works, a report that contains the 
                name, address, and social security number of the 
                employee, and the name and address of, and identifying 
                number assigned under section 6109 of the Internal 
                Revenue Code of 1986 to, the employer.
                    ``(B) Multistate employers.--An employer that has 
                employees who are employed in 2 or more States and that 
                transmits reports magnetically or electronically may 
                comply with subparagraph (A) by designating 1 State in 
                which such employer has employees to which the employer 
                will transmit the report described in subparagraph (A), 
                and transmitting such report to such State. Any 
                employer that transmits reports pursuant to this 
                subparagraph shall notify the Secretary in writing as 
                to which State such employer designates for the purpose 
                of sending reports.
                    ``(C) Federal government employers.--Any 
                department, agency, or instrumentality of the United 
                States shall comply with subparagraph (A) by 
                transmitting the report described in subparagraph (A) 
                to the National Directory of New Hires established 
                pursuant to section 453.
            ``(2) Timing of report.--Each State may provide the time 
        within which the report required by paragraph (1) shall be made 
        with respect to an employee, but such report shall be made--
                    ``(A) not later than 20 days after the date the 
                employer hires the employee; or
                    ``(B) in the case of an employer transmitting 
                reports magnetically or electronically, by 2 monthly 
                transmissions (if necessary) not less than 12 days nor 
                more than 16 days apart.
    ``(c) Reporting Format and Method.--Each report required by 
subsection (b) shall be made on a W-4 form or, at the option of the 
employer, an equivalent form, and may be transmitted by 1st class mail, 
magnetically, or electronically.
    ``(d) Civil Money Penalties on Noncomplying Employers.--The State 
shall have the option to set a State civil money penalty which does not 
exceed--
            ``(1) $25; or
            ``(2) $500 if, under State law, the failure is the result 
        of a conspiracy between the employer and the employee to not 
        supply the required report or to supply a false or incomplete 
        report.
    ``(e) Entry of Employer Information.--Information shall be entered 
into the data base maintained by the State Directory of New Hires 
within 5 business days of receipt from an employer pursuant to 
subsection (b).
    ``(f) Information Comparisons.--
            ``(1) In general.--Not later than May 1, 1998, an agency 
        designated by the State shall, directly or by contract, conduct 
        automated comparisons of the social security numbers reported 
        by employers pursuant to subsection (b) and the social security 
        numbers appearing in the records of the State case registry for 
        cases being enforced under the State plan.
            ``(2) Notice of match.--When an information comparison 
        conducted under paragraph (1) reveals a match with respect to 
        the social security number of an individual required to provide 
        support under a support order, the State Directory of New Hires 
        shall provide the agency administering the State plan approved 
        under this part of the appropriate State with the name, 
        address, and social security number of the employee to whom the 
        social security number is assigned, and the name of, and 
        identifying number assigned under section 6109 of the Internal 
        Revenue Code of 1986 to the employer.
    ``(g) Transmission of Information.--
            ``(1) Transmission of wage withholding notices to 
        employers.--Within 2 business days after the date information 
        regarding a newly hired employee is entered into the State 
        Directory of New Hires, the State agency enforcing the 
        employee's child support obligation shall transmit a notice to 
        the employer of the employee directing the employer to withhold 
        from the wages of the employee an amount equal to the monthly 
        (or other periodic) child support obligation (including any 
        past due support obligation) of the employee, unless the 
        employee's wages are not subject to withholding pursuant to 
        section 466(b)(3).
            ``(2) Transmissions to the national directory of new 
        hires.--
                    ``(A) New hire information.--Within 3 business days 
                after the date information regarding a newly hired 
                employee is entered into the State Directory of New 
                Hires, the State Directory of New Hires shall furnish 
                the information to the National Directory of New Hires.
                    ``(B) Wage and unemployment compensation 
                information.--The State Directory of New Hires shall, 
                on a quarterly basis, furnish to the National Directory 
                of New Hires extracts of the reports required under 
                section 303(a)(6) to be made to the Secretary of Labor 
                concerning the wages and unemployment compensation paid 
                to individuals, by such dates, in such format, and 
                containing such information as the Secretary of Health 
                and Human Services shall specify in regulations.
            ``(3) Business day defined.--As used in this subsection, 
        the term `business day' means a day on which State offices are 
        open for regular business.
    ``(h) Other Uses of New Hire Information.--
            ``(1) Location of child support obligors.--The agency 
        administering the State plan approved under this part shall use 
        information received pursuant to subsection (f)(2) to locate 
        individuals for purposes of establishing paternity and 
        establishing, modifying, and enforcing child support 
        obligations.
            ``(2) Verification of eligibility for certain programs.--A 
        State agency responsible for administering a program specified 
        in section 1137(b) shall have access to information reported by 
        employers pursuant to subsection (b) of this section for 
        purposes of verifying eligibility for the program.
            ``(3) Administration of employment security and workers' 
        compensation.--State agencies operating employment security and 
        workers' compensation programs shall have access to information 
        reported by employers pursuant to subsection (b) for the 
        purposes of administering such programs.''.
    (c) Quarterly Wage Reporting.--Section 1137(a)(3) (42 U.S.C. 1320b-
7(a)(3)) is amended--
            (1) by inserting ``(including State and local governmental 
        entities and labor organizations (as defined in section 
        453A(a)(2)(B)(iii))'' after ``employers''; and
            (2) by inserting ``, and except that no report shall be 
        filed with respect to an employee of a State or local agency 
        performing intelligence or counterintelligence functions, if 
        the head of such agency has determined that filing such a 
        report could endanger the safety of the employee or compromise 
        an ongoing investigation or intelligence mission'' after 
        ``paragraph (2)''.

SEC. 214. AMENDMENTS CONCERNING INCOME WITHHOLDING.

    (a) Mandatory Income Withholding.--
            (1) In general.--Section 466(a)(1) (42 U.S.C. 666(a)(1)) is 
        amended to read as follows:
            ``(1)(A) Procedures described in subsection (b) for the 
        withholding from income of amounts payable as support in cases 
        subject to enforcement under the State plan.
            ``(B) Procedures under which the wages of a person with a 
        support obligation imposed by a support order issued (or 
        modified) in the State before October 1, 1996, if not otherwise 
subject to withholding under subsection (b), shall become subject to 
withholding as provided in subsection (b) if arrearages occur, without 
the need for a judicial or administrative hearing.''.
            (2) Conforming amendments.--
                    (A) Section 466(b) (42 U.S.C. 666(b)) is amended in 
                the matter preceding paragraph (1), by striking 
                ``subsection (a)(1)'' and inserting ``subsection 
                (a)(1)(A)''.
                    (B) Section 466(b)(4) (42 U.S.C. 666(b)(4)) is 
                amended to read as follows:
    ``(4)(A) Such withholding must be carried out in full compliance 
with all procedural due process requirements of the State, and the 
State must send notice to each noncustodial parent to whom paragraph 
(1) applies--
            ``(i) that the withholding has commenced; and
            ``(ii) of the procedures to follow if the noncustodial 
        parent desires to contest such withholding on the grounds that 
        the withholding or the amount withheld is improper due to a 
        mistake of fact.
    ``(B) The notice under subparagraph (A) of this paragraph shall 
include the information provided to the employer under paragraph 
(6)(A).''.
                    (C) Section 466(b)(5) (42 U.S.C. 666(b)(5)) is 
                amended by striking all that follows ``administered 
                by'' and inserting ``the State through the State 
                disbursement unit established pursuant to section 454B, 
                in accordance with the requirements of section 454B.''.
                    (D) Section 466(b)(6)(A) (42 U.S.C. 666(b)(6)(A)) 
                is amended--
                            (i) in clause (i), by striking ``to the 
                        appropriate agency'' and all that follows and 
                        inserting ``to the State disbursement unit 
                        within 2 business days after the date the 
                        amount would (but for this subsection) have 
                        been paid or credited to the employee, for 
                        distribution in accordance with this part. The 
                        employer shall comply with the procedural rules 
                        relating to income withholding of the State in 
                        which the employee works, regardless of the 
                        State where the notice originates.'',
                            (ii) in clause (ii), by inserting ``be in a 
                        standard format prescribed by the Secretary, 
                        and'' after ``shall''; and
                            (iii) by adding at the end the following 
                        new clause:
                            ``(iii) As used in this subparagraph, the 
                        term `business day' means a day on which State 
                        offices are open for regular business.''.
                    (E) Section 466(b)(6)(D) (42 U.S.C. 666(b)(6)(D)) 
                is amended by striking ``any employer'' and all that 
                follows and inserting ``any employer who--
                            ``(i) discharges from employment, refuses 
                        to employ, or takes disciplinary action against 
                        any noncustodial parent subject to wage 
                        withholding required by this subsection because 
                        of the existence of such withholding and the 
                        obligations or additional obligations which it 
                        imposes upon the employer; or
                            ``(ii) fails to withhold support from 
                        wages, or to pay such amounts to the State 
                        disbursement unit in accordance with this 
                        subsection.''.
                    (F) Section 466(b) (42 U.S.C. 666(b)) is amended by 
                adding at the end the following new paragraph:
            ``(11) Procedures under which the agency administering the 
        State plan approved under this part may execute a withholding 
        order without advance notice to the obligor, including issuing 
        the withholding order through electronic means.''.
    (b) Conforming Amendment.--Section 466(c) (42 U.S.C. 666(c)) is 
repealed.

SEC. 215. LOCATOR INFORMATION FROM INTERSTATE NETWORKS.

    Section 466(a) (42 U.S.C. 666(a)) is amended by adding at the end 
the following new paragraph:
            ``(12) Locator information from interstate networks.--
        Procedures to ensure that all Federal and State agencies 
        conducting activities under this part have access to any system 
        used by the State to locate an individual for purposes relating 
        to motor vehicles or law enforcement.''.

SEC. 216. EXPANSION OF THE FEDERAL PARENT LOCATOR SERVICE.

    (a) Expanded Authority To Locate Individuals and Assets.--Section 
453 (42 U.S.C. 653) is amended--
            (1) in subsection (a), by striking all that follows 
        subsection (c))'' and inserting ``, for the purpose of 
        establishing parentage, establishing, setting the amount of, 
        modifying, or enforcing child support obligations, or enforcing 
        child custody or visitation orders--
            ``(1) information on, or facilitating the discovery of, the 
        location of any individual--
                    ``(A) who is under an obligation to pay child 
                support or provide child custody or visitation rights;
                    ``(B) against whom such an obligation is sought; or
                    ``(C) to whom such an obligation is owed, including 
                the individual's social security number (or numbers), 
                most recent address, and the name, address, and 
                employer identification number of the individual's 
                employer;
            ``(2) information on the individual's wages (or other 
        income) from, and benefits of, employment (including rights to 
        or enrollment in group health care coverage); and
            ``(3) information on the type, status, location, and amount 
        of any assets of, or debts owed by or to, any such 
        individual.''; and
            (2) in subsection (b)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``social security'' and all that follows 
                through ``absent parent'' and inserting ``information 
                described in subsection (a)''; and
                    (B) in the flush paragraph at the end, by adding 
                the following: ``No information shall be disclosed to 
                any person if the State has notified the Secretary that 
                the State has reasonable evidence of domestic violence 
                or child abuse and the disclosure of such information 
                could be harmful to the custodial parent or the child 
                of such parent. Information received or transmitted 
                pursuant to this section shall be subject to the 
                safeguard provisions contained in section 454(26).''.
    (b) Authorized Person for Information Regarding Visitation 
Rights.--Section 453(c) (42 U.S.C. 653(c)) is amended--
            (1) in paragraph (1), by striking ``support'' and inserting 
        ``support or to seek to enforce orders providing child custody 
        or visitation rights''; and
            (2) in paragraph (2), by striking ``, or any agent of such 
        court; and'' and inserting ``or to issue an order against a 
        resident parent for child custody or visitation rights, or any 
        agent of such court;''.
    (c) Reimbursement for Information From Federal Agencies.--Section 
453(e)(2) (42 U.S.C. 653(e)(2)) is amended in the 4th sentence by 
inserting ``in an amount which the Secretary determines to be 
reasonable payment for the information exchange (which amount shall not 
include payment for the costs of obtaining, compiling, or maintaining 
the information)'' before the period.
    (d) Reimbursement for Reports by State Agencies.--Section 453 (42 
U.S.C. 653) is amended by adding at the end the following new 
subsection:
    ``(g) Reimbursement for Reports by State Agencies.--The Secretary 
may reimburse Federal and State agencies for the costs incurred by such 
entities in furnishing information requested by the Secretary under 
this section in an amount which the Secretary determines to be 
reasonable payment for the information exchange (which amount shall not 
include payment for the costs of obtaining, compiling, or maintaining 
the information).''.
    (e) Conforming Amendments.--
            (1) Sections 452(a)(9), 453(a), 453(b), 463(a), 463(e), and 
        463(f) (42 U.S.C. 652(a)(9), 653(a), 653(b), 663(a), 663(e), 
        and 663(f)) are each amended by inserting ``Federal'' before 
        ``Parent'' each place such term appears.
            (2) Section 453 (42 U.S.C. 653) is amended in the heading 
        by adding ``federal'' before ``parent''.
    (f) New Components.--Section 453 (42 U.S.C. 653), as amended by 
subsection (d) of this section, is amended by adding at the end the 
following new subsections:
    ``(h) Federal Case Registry of Child Support Orders.--
            ``(1) In general.--Not later than October 1, 1998, in order 
        to assist States in administering programs under State plans 
        approved under this part and programs funded under part A, and 
        for the other purposes specified in this section, the Secretary 
        shall establish and maintain in the Federal Parent Locator 
        Service an automated registry (which shall be known as the 
        `Federal Case Registry of Child Support Orders'), which shall 
        contain abstracts of support orders and other information 
        described in paragraph (2) with respect to each case in each 
        State case registry maintained pursuant to section 454A(e), as 
        furnished (and regularly updated), pursuant to section 454A(f), 
        by State agencies administering programs under this part.
            ``(2) Case information.--The information referred to in 
        paragraph (1) with respect to a case shall be such information 
        as the Secretary may specify in regulations (including the 
        names, social security numbers or other uniform identification 
        numbers, and State case identification numbers) to identify the 
        individuals who owe or are owed support (or with respect to or 
        on behalf of whom support obligations are sought to be 
        established), and the State or States which have the case.
    ``(i) National Directory of New Hires.--
            ``(1) In general.--In order to assist States in 
        administering programs under State plans approved under this 
        part and programs funded under part A, and for the other 
        purposes specified in this section, the Secretary, not later 
        than April 1, 1997, shall establish and maintain in the Federal 
        Parent Locator Service an automated directory to be known as 
        the National Directory of New Hires, which shall contain the 
        information supplied pursuant to section 453A(g)(2).
            ``(2) Entry of data.--Information shall be entered into the 
        data base maintained by the National Directory of New Hires 
        within 2 business days of receipt pursuant to section 
        453A(g)(2).
            ``(3) Administration of federal tax laws.--The Secretary of 
        the Treasury shall have access to the information in the 
        National Directory of New Hires for purposes of administering 
        section 32 of the Internal Revenue Code of 1986, or the advance 
        payment of the earned income tax credit under section 3507 of 
        such Code, and verifying a claim with respect to employment in 
        a tax return.
            ``(4) List of multistate employers.--The Secretary shall 
        maintain within the National Directory of New Hires a list of 
        multistate employers that report information regarding newly 
        hired employees pursuant to section 453A(b)(1)(B), and the 
        State which each such employer has designated to receive such 
        information.
    ``(j) Information Comparisons and Other Disclosures.--
            ``(1) Verification by social security administration.--
                    ``(A) In general.--The Secretary shall transmit 
                information on individuals and employers maintained 
                under this section to the Social Security 
                Administration to the extent necessary for verification 
                in accordance with subparagraph (B).
                    ``(B) Verification by ssa.--The Social Security 
                Administration shall verify the accuracy of, correct, 
                or supply to the extent possible, and report to 
the Secretary, the following information supplied by the Secretary 
pursuant to subparagraph (A):
                            ``(i) The name, social security number, and 
                        birth date of each such individual.
                            ``(ii) The employer identification number 
                        of each such employer.
            ``(2) Information comparisons.--For the purpose of locating 
        individuals in a paternity establishment case or a case 
        involving the establishment, modification, or enforcement of a 
        support order, the Secretary shall--
                    ``(A) compare information in the National Directory 
                of New Hires against information in the support case 
                abstracts in the Federal Case Registry of Child Support 
                Orders not less often than every 2 business days; and
                    ``(B) within 2 such days after such a comparison 
                reveals a match with respect to an individual, report 
                the information to the State agency responsible for the 
                case.
            ``(3) Information comparisons and disclosures of 
        information in all registries for title iv program purposes.--
        To the extent and with the frequency that the Secretary 
        determines to be effective in assisting States to carry out 
        their responsibilities under programs operated under this part 
        and programs funded under part A, the Secretary shall--
                    ``(A) compare the information in each component of 
                the Federal Parent Locator Service maintained under 
                this section against the information in each other such 
                component (other than the comparison required by 
                paragraph (2)), and report instances in which such a 
                comparison reveals a match with respect to an 
                individual to State agencies operating such programs; 
                and
                    ``(B) disclose information in such registries to 
                such State agencies.
            ``(4) Provision of new hire information to the social 
        security administration.--The National Directory of New Hires 
        shall provide the Commissioner of Social Security with all 
        information in the National Directory, which shall be used to 
        determine the accuracy of payments under the supplemental 
        security income program under title XVI and in connection with 
        benefits under title II.
            ``(5) Research.--The Secretary may provide access to 
        information reported by employers pursuant to section 453A(b) 
        for research purposes found by the Secretary to be likely to 
        contribute to achieving the purposes of part A or this part, 
        but without personal identifiers.
    ``(k) Fees.--
            ``(1) For ssa verification.--The Secretary shall reimburse 
        the Commissioner of Social Security, at a rate negotiated 
        between the Secretary and the Commissioner, for the costs 
        incurred by the Commissioner in performing the verification 
        services described in subsection (j).
            ``(2) For information from state directories of new 
        hires.--The Secretary shall reimburse costs incurred by State 
        directories of new hires in furnishing information as required 
        by subsection (j)(3), at rates which the Secretary determines 
        to be reasonable (which rates shall not include payment for the 
        costs of obtaining, compiling, or maintaining such 
        information).
            ``(3) For information furnished to state and federal 
        agencies.--A State or Federal agency that receives information 
        from the Secretary pursuant to this section shall reimburse the 
        Secretary for costs incurred by the Secretary in furnishing the 
        information, at rates which the Secretary determines to be 
        reasonable (which rates shall include payment for the costs of 
        obtaining, verifying, maintaining, and comparing the 
        information).
    ``(l) Restriction on Disclosure and Use.--Information in the 
Federal Parent Locator Service, and information resulting from 
comparisons using such information, shall not be used or disclosed 
except as expressly provided in this section, subject to section 6103 
of the Internal Revenue Code of 1986.
    ``(m) Information Integrity and Security.--The Secretary shall 
establish and implement safeguards with respect to the entities 
established under this section designed to--
            ``(1) ensure the accuracy and completeness of information 
        in the Federal Parent Locator Service; and
            ``(2) restrict access to confidential information in the 
        Federal Parent Locator Service to authorized persons, and 
        restrict use of such information to authorized purposes.
    ``(n) Federal Government Reporting.--Each department, agency, and 
instrumentality of the United States on a quarterly basis shall report 
to the Federal Parent Locator Service the name and social security 
number of each employee and the wages paid to the employee during the 
previous quarter, except that such a report shall not be filed with 
respect to an employee of a department, agency, or instrumentality 
performing intelligence or counterintelligence functions, if the head 
of such department, agency, or instrumentality has determined that 
filing such a report could endanger the safety of the employee or 
compromise an ongoing investigation or intelligence mission.''.
    (g) Conforming Amendments.--
            (1) To part d of title iv of the social security act.--
                    (A) Section 454(8)(B) (42 U.S.C. 654(8)(B)) is 
                amended to read as follows:
                    ``(B) the Federal Parent Locator Service 
                established under section 453;''.
                    (B) Section 454(13) (42 U.S.C. 654(13)) is amended 
                by inserting ``and provide that information requests by 
                parents who are residents of other States be treated 
                with the same priority as requests by parents who are 
                residents of the State submitting the plan'' before the 
                semicolon.
            (2) To federal unemployment tax act.--Section 3304(a)(16) 
        of the Internal Revenue Code of 1986 is amended--
                    (A) by striking ``Secretary of Health, Education, 
                and Welfare'' each place such term appears and 
                inserting ``Secretary of Health and Human Services'';
                    (B) in subparagraph (B), by striking ``such 
                information'' and all that follows and inserting 
                ``information furnished under subparagraph (A) or (B) 
                is used only for the purposes authorized under such 
                subparagraph;'';
                    (C) by striking ``and'' at the end of subparagraph 
                (A);
                    (D) by redesignating subparagraph (B) as 
                subparagraph (C); and
                    (E) by inserting after subparagraph (A) the 
                following new subparagraph:
                    ``(B) wage and unemployment compensation 
                information contained in the records of such agency 
                shall be furnished to the Secretary of Health and Human 
                Services (in accordance with regulations promulgated by 
                such Secretary) as necessary for the purposes of the 
                National Directory of New Hires established under 
                section 453(i) of the Social Security Act, and''.
            (3) To state grant program under title iii of the social 
        security act.--Subsection (h) of section 303 (42 U.S.C. 503) is 
        amended to read as follows:
    ``(h)(1) The State agency charged with the administration of the 
State law shall, on a reimbursable basis--
            ``(A) disclose quarterly, to the Secretary of Health and 
        Human Services, wage and claim information, as required 
        pursuant to section 453(i)(1), contained in the records of such 
        agency;
            ``(B) ensure that information provided pursuant to 
        subparagraph (A) meets such standards relating to correctness 
        and verification as the Secretary of Health and Human Services, 
        with the concurrence of the Secretary of Labor, may find 
        necessary; and
            ``(C) establish such safeguards as the Secretary of Labor 
        determines are necessary to insure that information disclosed 
        under subparagraph (A) is used only for purposes of section 
        453(i)(1) in carrying out the child support enforcement program 
        under title IV.
    ``(2) Whenever the Secretary of Labor, after reasonable notice and 
opportunity for hearing to the State agency charged with the 
administration of the State law, finds that there is a failure to 
comply substantially with the requirements of paragraph (1), the 
Secretary of Labor shall notify such State agency that further payments 
will not be made to the State until the Secretary of Labor is satisfied 
that there is no longer any such failure. Until the Secretary of Labor 
is so satisfied, the Secretary shall make no future certification to 
the Secretary of the Treasury with respect to the State.
    ``(3) For purposes of this subsection--
            ``(A) the term `wage information' means information 
        regarding wages paid to an individual, the social security 
        account number of such individual, and the name, address, 
        State, and the Federal employer identification number of the 
        employer paying such wages to such individual; and
            ``(B) the term `claim information' means information 
        regarding whether an individual is receiving, has received, or 
        has made application for, unemployment compensation, the amount 
        of any such compensation being received (or to be received by 
        such individual), and the individual's current (or most recent) 
        home address.''.
            (4) Disclosure of certain information to agents of child 
        support enforcement agencies.--
                    ``(A) In general.--Paragraph (6) of section 6103(l) 
                of the Internal Revenue Code of 1986 (relating to 
                disclosure of return information to Federal, State, and 
                local child support enforcement agencies) is amended by 
                redesignating subparagraph (B) as subparagraph (C) and 
                by inserting after subparagraph (A) the following new 
                subparagraph:
                    ``(B) Disclosure to certain agents.--The following 
                information disclosed to any child support enforcement 
                agency under subparagraph (A) with respect to any 
                individual with respect to whom child support 
                obligations are sought to be established or enforced 
                may be disclosed by such agency to any agent of such 
                agency which is under contract with such agency to 
                carry out the purposes described in subparagraph (C):
                            ``(i) The address and social security 
                        account number (or numbers) of such individual.
                            ``(ii) The amount of any reduction under 
                        section 6402(c) (relating to offset of past-due 
                        support against overpayments) in any 
                        overpayment otherwise payable to such 
                        individual.''.
                    (B) Conforming amendments.--
                            (i) Paragraph (3) of section 6103(a) of 
                        such Code is amended by striking ``(l)(12)'' 
                        and inserting ``paragraph (6) or (12) of 
                        subsection (l)''.
                            (ii) Subparagraph (C) of section 6103(l)(6) 
                        of such Code, as redesignated by subsection 
                        (a), is amended to read as follows:
                    ``(C) Restriction on disclosure.--Information may 
                be disclosed under this paragraph only for purposes of, 
                and to the extent necessary in, establishing and 
                collecting child support obligations from, and 
                locating, individuals owing such obligations.''.
                            (iii) The material following subparagraph 
                        (F) of section 6103(p)(4) of such Code is 
                        amended by striking ``subsection (l)(12)(B)'' 
                        and inserting ``paragraph (6)(A) or (12)(B) of 
                        subsection (l)''.

SEC. 217. COLLECTION AND USE OF SOCIAL SECURITY NUMBERS FOR USE IN 
              CHILD SUPPORT ENFORCEMENT.

    (a) State Law Requirement.--Section 466(a) (42 U.S.C. 666(a)), as 
amended by section 215 of this Act, is amended by adding at the end the 
following new paragraph:
            ``(13) Recording of social security numbers in certain 
        matters.--Procedures requiring that the social security number 
        of--
                    ``(A) any applicant for a professional license, 
                commercial driver's license, occupational license, or 
                marriage license be recorded on the application;
                    ``(B) any individual who is subject to a divorce 
                decree, support order, or paternity determination or 
                acknowledgment be placed in the records relating to the 
                matter; and
                    ``(C) any individual who has died be placed in the 
                records relating to the death and be recorded on the 
                death certificate.
        For purposes of subparagraph (A), if a State allows the use of 
        a number other than the social security number, the State shall 
        so advise any applicants.''.
    (b) Conforming Amendments.--Section 205(c)(2)(C) (42 U.S.C. 
405(c)(2)(C)) is amended--
            (1) in clause (i), by striking ``may require'' and 
        inserting ``shall require'';
            (2) in clause (ii), by inserting after the first sentence 
        the following: ``In the administration of any law involving the 
        issuance of a marriage certificate or license, each State shall 
        require each party named in the certificate or license to 
        furnish to the State (or political subdivision thereof), or any 
        State agency having administrative responsibility for the law 
        involved, the social security number of the party.'';
            (3) in clause (ii), by inserting ``or marriage 
        certificate'' after ``Such numbers shall not be recorded on the 
        birth certificate''.
            (4) in clause (vi), by striking ``may'' and inserting 
        ``shall''; and
            (5) by adding at the end the following new clauses:
                            ``(x) An agency of a State (or a political 
                        subdivision thereof) charged with the 
                        administration of any law concerning the 
                        issuance or renewal of a license, certificate, 
                        permit, or other authorization to engage in a 
                        profession, an occupation, or a commercial 
                        activity shall require all applicants for 
                        issuance or renewal of the license, 
                        certificate, permit, or other authorization to 
                        provide the applicant's social security number 
                        to the agency for the purpose of administering 
                        such laws, and for the purpose of responding to 
                        requests for information from an agency 
                        operating pursuant to part D of title IV.
                            ``(xi) All divorce decrees, support orders, 
                        and paternity determinations issued, and all 
                        paternity acknowledgments made, in each State 
                        shall include the social security number of 
                        each party to the decree, order, determination, 
                        or acknowledgment in the records relating to 
                        the matter, for the purpose of responding to 
                        requests for information from an agency 
                        operating pursuant to part D of title IV.''.

          Subtitle C--Streamlining and Uniformiy of Procedures

SEC. 221. ADOPTION OF UNIFORM STATE LAWS.

    Section 466 (42 U.S.C. 666) is amended by adding at the end the 
following new subsection:
    ``(f) Uniform Interstate Family Support Act.--
            ``(1) Enactment and use.--In order to satisfy section 
        454(20)(A), on and after January 1, 1998, each State must have 
        in effect the Uniform Interstate Family Support Act, as 
        approved by the American Bar Association on February 9, 1993, 
        together with any amendments officially adopted before January 
        1, 1998 by the National Conference of Commissioners on Uniform 
        State Laws.
            ``(2) Employers to follow procedural rules of state where 
        employee works.--The State law enacted pursuant to paragraph 
        (1) shall provide that an employer that receives an income 
        withholding order or notice pursuant to section 501 of the 
        Uniform Interstate Family Support Act shall follow the 
        procedural rules that apply with respect to such order or 
        notice under the laws of the State in which the obligor is 
        employed.''.

SEC. 222. IMPROVEMENTS TO FULL FAITH AND CREDIT FOR CHILD SUPPORT 
              ORDERS.

    Section 1738B of title 28, United States Code, is amended--
            (1) in subsection (a)(2), by striking ``subsection (e)'' 
        and inserting ``subsections (e), (f), and (i)'';
            (2) in subsection (b), by inserting after the 2nd 
        undesignated paragraph the following: ```child's home State' 
        means the State in which a child lived with a parent or a 
        person acting as parent for at least 6 consecutive months 
        immediately preceding the time of filing of a petition or 
        comparable pleading for support and, if a child is less than 6 
        months old, the State in which the child lived from birth with 
        any of them. A period of temporary absence of any of them is 
        counted as part of the 6-month period.'';
            (3) in subsection (c), by inserting ``by a court of a 
        State'' before ``is made'';
            (4) in subsection (c)(1), by inserting ``and subsections 
        (e), (f), and (g)'' after ``located'';
            (5) in subsection (d)--
                    (A) by inserting ``individual'' before 
                ``contestant''; and
                    (B) by striking ``subsection (e)'' and inserting 
                ``subsections (e) and (f)'';
            (6) in subsection (e), by striking ``make a modification of 
        a child support order with respect to a child that is made'' 
        and inserting ``modify a child support order issued'';
            (7) in subsection (e)(1), by inserting ``pursuant to 
        subsection (i)'' before the semicolon;
            (8) in subsection (e)(2)--
                    (A) by inserting ``individual'' before 
                ``contestant'' each place such term appears; and
                    (B) by striking ``to that court's making the 
                modification and assuming'' and inserting ``with the 
                State of continuing, exclusive jurisdiction for a court 
                of another State to modify the order and assume'';
            (9) by redesignating subsections (f) and (g) as subsections 
        (g) and (h), respectively;
            (10) by inserting after subsection (e) the following new 
        subsection:
    ``(f) Recognition of Child Support Orders.--If 1 or more child 
support orders have been issued in this or another State with regard to 
an obligor and a child, a court shall apply the following rules in 
determining which order to recognize for purposes of continuing, 
exclusive jurisdiction and enforcement:
            ``(1) If only 1 court has issued a child support order, the 
        order of that court must be recognized.
            ``(2) If 2 or more courts have issued child support orders 
        for the same obligor and child, and only 1 of the courts would 
        have continuing, exclusive jurisdiction under this section, the 
        order of that court must be recognized.
            ``(3) If 2 or more courts have issued child support orders 
        for the same obligor and child, and more than 1 of the courts 
        would have continuing, exclusive jurisdiction under this 
        section, an order issued by a court in the current home State 
        of the child must be recognized, but if an order has not been 
        issued in the current home State of the child, the order most 
        recently issued must be recognized.
            ``(4) If 2 or more courts have issued child support orders 
        for the same obligor and child, and none of the courts would 
        have continuing, exclusive jurisdiction under this section, a 
        court may issue a child support order, which must be 
        recognized.
            ``(5) The court that has issued an order recognized under 
        this subsection is the court having continuing, exclusive 
        jurisdiction.'';
            (11) in subsection (g) (as so redesignated)--
                    (A) by striking ``PRIOR'' and inserting 
                ``MODIFIED''; and
                    (B) by striking ``subsection (e)'' and inserting 
                ``subsections (e) and (f)'';
            (12) in subsection (h) (as so redesignated)--
                    (A) in paragraph (2), by inserting ``including the 
                duration of current payments and other obligations of 
                support'' before the comma; and
                    (B) in paragraph (3), by inserting ``arrears 
                under'' after ``enforce''; and
            (13) by adding at the end the following new subsection:
    ``(i) Registration for Modification.--If there is no individual 
contestant or child residing in the issuing State, the party or support 
enforcement agency seeking to modify, or to modify and enforce, a child 
support order issued in another State shall register that order in a 
State with jurisdiction over the nonmovant for the purpose of 
modification.''.

SEC. 223. ADMINISTRATIVE ENFORCEMENT IN INTERSTATE CASES.

    Section 466(a) (42 U.S.C. 666(a)), as amended by sections 215 and 
217(a) of this Act, is amended by adding at the end the following new 
paragraph:
            ``(14) Administrative enforcement in interstate cases.--
        Procedures under which--
                    ``(A) the State shall respond within 5 business 
                days to a request made by another State to enforce a 
                support order (and for this purpose the term `business 
                day' means a day on which State offices are open for 
                regular business);
                    ``(B) the State may, by electronic or other means, 
                transmit to another State a request for assistance in a 
                case involving the enforcement of a support order, 
                which request--
                            ``(i) shall include such information as 
                        will enable the State to which the request is 
                        transmitted to compare the information about 
                        the case to the information in the data bases 
                        of the State; and
                            ``(ii) shall constitute a certification by 
                        the requesting State--
                                    ``(I) of the amount of support 
                                under the order the payment of which is 
                                in arrears; and
                                    ``(II) that the requesting State 
                                has complied with all procedural due 
                                process requirements applicable to the 
                                case;
                    ``(C) if the State provides assistance to another 
                State pursuant to this paragraph with respect to a 
                case, neither State shall consider the case to be 
                transferred to the caseload of such other State; and
                    ``(D) the State shall maintain records of--
                            ``(i) the number of such requests for 
                        assistance received by the State;
                            ``(ii) the number of cases for which the 
                        State collected support in response to such a 
                        request; and
                            ``(iii) the amount of such collected 
                        support.''.

SEC. 224. USE OF FORMS IN INTERSTATE ENFORCEMENT.

    (a) Promulgation.--Section 452(a) (42 U.S.C. 652(a)) is amended--
            (1) by striking ``and'' at the end of paragraph (9);
            (2) by striking the period at the end of paragraph (10) and 
        inserting ``; and''; and
            (3) by adding at the end the following new paragraph:
            ``(11) not later than December 31, 1996, after consulting 
        with the State directors of programs under this part, 
        promulgate forms to be used by States in interstate cases for--
                    ``(A) collection of child support through income 
                withholding;
                    ``(B) imposition of liens; and
                    ``(C) administrative subpoenas.''.
    (b) Use by States.--Section 454(9) (42 U.S.C. 654(9)) is amended--
            (1) by striking ``and'' at the end of subparagraph (C);
            (2) by inserting ``and'' at the end of subparagraph (D); 
        and
            (3) by adding at the end the following new subparagraph:
                    ``(E) no later than April 1, 1997, in using the 
                forms promulgated pursuant to section 452(a)(11) for 
                income withholding, imposition of liens, and issuance 
                of administrative subpoenas in interstate child support 
                cases;''.

SEC. 225. STATE LAWS PROVIDING EXPEDITED PROCEDURES.

    (a) State Law Requirements.--Section 466 (42 U.S.C. 666), as 
amended by section 214 of this Act, is amended--
            (1) in subsection (a)(2), by striking the first sentence 
        and inserting the following: ``Expedited administrative and 
        judicial procedures (including the procedures specified in 
        subsection (c)) for establishing paternity and for 
        establishing, modifying, and enforcing support obligations.''; 
        and
            (2) by inserting after subsection (b) the following new 
        subsection:
    ``(c) Expedited Procedures.--The procedures specified in this 
subsection, for purposes of the requirement of subsection (a)(2), are 
the following:
            ``(1) Administrative action by state agency.--Procedures 
        which give the State agency the authority to take the following 
        actions relating to establishment or enforcement of support 
        orders, without the necessity of obtaining an order from any 
        other judicial or administrative tribunal, and to recognize and 
        enforce the authority of State agencies of other States) to 
        take the following actions:
                    ``(A) Genetic testing.--To order genetic testing 
                for the purpose of paternity establishment as provided 
                in section 466(a)(5).
                    ``(B) Financial or other information.--To subpoena 
                any financial or other information needed to establish, 
                modify, or enforce a support order, and to impose 
                penalties for failure to respond to such a subpoena.
                    ``(C) Response to state agency request.--To require 
                all entities in the State (including for-profit, 
                nonprofit, and governmental employers) to provide 
                promptly, in response to a request by the State agency 
                of that or any other State administering a program 
                under this part, information on the employment, 
                compensation, and benefits of any individual employed 
                by such entity as an employee or contractor, and to 
                sanction failure to respond to any such request.
                    ``(D) Access to certain records.--To obtain access, 
                subject to safeguards on privacy and information 
                security, to the following records (including automated 
                access, in the case of records maintained in automated 
                data bases):
                            ``(i) Records of other state and local 
                        government agencies, including--
                                    ``(I) vital statistics (including 
                                records of marriage, birth, and 
                                divorce);
                                    ``(II) State and local tax and 
                                revenue records (including information 
                                on residence address, employer, income 
                                and assets);
                                    ``(III) records concerning real and 
                                titled personal property;
                                    ``(IV) records of occupational and 
                                professional licenses, and records 
                                concerning the ownership and control of 
                                corporations, partnerships, and other 
                                business entities;
                                    ``(V) employment security records;
                                    ``(VI) records of agencies 
                                administering public assistance 
                                programs;
                                    ``(VII) records of the motor 
                                vehicle department; and
                                    ``(VIII) corrections records.
                            ``(ii) Certain records held by private 
                        entities, including--
                                    ``(I) customer records of public 
                                utilities and cable television 
                                companies; and
                                    ``(II) information (including 
                                information on assets and liabilities) 
                                on individuals who owe or are owed 
                                support (or against or with respect to 
                                whom a support obligation is sought) 
                                held by financial institutions (subject 
                                to limitations on liability of such 
                                entities arising from affording such 
                                access), as provided pursuant to 
                                agreements described in subsection 
                                (a)(18).
                    ``(E) Change in payee.--In cases in which support 
                is subject to an assignment in order to comply with a 
                requirement imposed pursuant to part A or section 1912, 
                or to a requirement to pay through the State 
                disbursement unit established pursuant to section 454B, 
                upon providing notice to obligor and obligee, to direct 
                the obligor or other payor to change the payee to the 
                appropriate government entity.
                    ``(F) Income withholding.--To order income 
                withholding in accordance with subsections (a)(1) and 
                (b) of section 466.
                    ``(G) Securing assets.--In cases in which there is 
                a support arrearage, to secure assets to satisfy the 
                arrearage by--
                            ``(i) intercepting or seizing periodic or 
                        lump-sum payments from--
                                    ``(I) a State or local agency, 
                                including unemployment compensation, 
                                workers' compensation, and other 
                                benefits; and
                                    ``(II) judgments, settlements, and 
                                lotteries;
                            ``(ii) attaching and seizing assets of the 
                        obligor held in financial institutions;
                            ``(iii) attaching public and private 
                        retirement funds; and
                            ``(iv) imposing liens in accordance with 
                        subsection (a)(4) and, in appropriate cases, to 
                        force sale of property and distribution of 
                        proceeds.
                    ``(H) Increased monthly payments.--For the purpose 
                of securing overdue support, to increase the amount of 
                monthly support payments to include amounts for 
arrearages, subject to such conditions or limitations as the State may 
provide.
        Such procedures shall be subject to due process safeguards, 
        including (as appropriate) requirements for notice, opportunity 
        to contest the action, and opportunity for an appeal on the 
        record to an independent administrative or judicial tribunal.
            ``(2) Substantive and procedural rules.--The expedited 
        procedures required under subsection (a)(2) shall include the 
        following rules and authority, applicable with respect to all 
        proceedings to establish paternity or to establish, modify, or 
        enforce support orders:
                    ``(A) Locator information; presumptions concerning 
                notice.--Procedures under which--
                            ``(i) each party to any paternity or child 
                        support proceeding is required (subject to 
                        privacy safeguards) to file with the tribunal 
                        and the State case registry upon entry of an 
                        order, and to update as appropriate, 
                        information on location and identity of the 
                        party, including social security number, 
                        residential and mailing addresses, telephone 
                        number, driver's license number, and name, 
                        address, and name and telephone number of 
                        employer; and
                            ``(ii) in any subsequent child support 
                        enforcement action between the parties, upon 
                        sufficient showing that diligent effort has 
                        been made to ascertain the location of such a 
                        party, the tribunal may deem State due process 
                        requirements for notice and service of process 
                        to be met with respect to the party, upon 
                        delivery of written notice to the most recent 
                        residential or employer address filed with the 
                        tribunal pursuant to clause (i).
                    ``(B) Statewide jurisdiction.--Procedures under 
                which--
                            ``(i) the State agency and any 
                        administrative or judicial tribunal with 
                        authority to hear child support and paternity 
                        cases exerts statewide jurisdiction over the 
                        parties; and
                            ``(ii) in a State in which orders are 
                        issued by courts or administrative tribunals, a 
                        case may be transferred between local 
                        jurisdictions in the State without need for any 
                        additional filing by the petitioner, or service 
                        of process upon the respondent, to retain 
                        jurisdiction over the parties.
            ``(3) Coordination with erisa.--Notwithstanding subsection 
        (d) of section 514 of the Employee Retirement Income Security 
        Act of 1974 (relating to effect on other laws), nothing in this 
        subsection shall be construed to alter, amend, modify, 
        invalidate, impair, or supersede subsections (a), (b), and (c) 
        of such section 514 as it applies with respect to any procedure 
        referred to in paragraph (1) and any expedited procedure 
        referred to in paragraph (2), except to the extent that such 
        procedure would be consistent with the requirements of section 
        206(d)(3) of such Act (relating to qualified domestic relations 
        orders) or the requirements of section 609(a) of such Act 
        (relating to qualified medical child support orders) if the 
        reference in such section 206(d)(3) to a domestic relations 
        order and the reference in such section 609(a) to a medical 
        child support order were a reference to a support order 
        referred to in paragraphs (1) and (2) relating to the same 
        matters, respectively.''.
    (b) Automation of State Agency Functions.--Section 454A, as added 
by section 245(a)(2) and as amended by sections 211 and 212(c) of this 
Act, is amended by adding at the end the following new subsection:
    ``(h) Expedited Administrative Procedures.--The automated system 
required by this section shall be used, to the maximum extent feasible, 
to implement the expedited administrative procedures required by 
section 466(c).''.

                  Subtitle D--Paternity Establishment

SEC. 231. STATE LAWS CONCERNING PATERNITY ESTABLISHMENT.

    (a) State Laws Required.--Section 466(a)(5) (42 U.S.C. 666(a)(5)) 
is amended to read as follows:
            ``(5) Procedures concerning paternity establishment.
                    ``(A) Establishment process available from birth 
                until age 18.--
                            ``(i) Procedures which permit the 
                        establishment of the paternity of a child at 
                        any time before the child attains 18 years of 
                        age.
                            ``(ii) As of August 16, 1984, clause (i) 
                        shall also apply to a child for whom paternity 
                        has not been established or for whom a 
                        paternity action was brought but dismissed 
                        because a statute of limitations of less than 
                        18 years was then in effect in the State.
                    ``(B) Procedures concerning genetic testing.--
                            ``(i) Genetic testing required in certain 
                        contested cases.--Procedures under which the 
                        State is required, in a contested paternity 
                        case (unless otherwise barred by State law) to 
                        require the child and all other parties (other 
                        than individuals found under section 454(29) to 
                        have good cause for refusing to cooperate) to 
                        submit to genetic tests upon the request of any 
                        such party, if the request is supported by a 
                        sworn statement by the party--
                                    ``(I) alleging paternity, and 
                                setting forth facts establishing a 
                                reasonable possibility of the requisite 
                                sexual contact between the parties; or
                                    ``(II) denying paternity, and 
                                setting forth facts establishing a 
                                reasonable possibility of the 
                                nonexistence of sexual contact between 
                                the parties.
                            ``(ii) Other requirements.--Procedures 
                        which require the State agency, in any case in 
                        which the agency orders genetic testing--
                                    ``(I) to pay costs of such tests, 
                                subject to recoupment (if the State so 
                                elects) from the alleged father if 
                                paternity is established; and
                                    ``(II) to obtain additional testing 
                                in any case if an original test result 
                                is contested, upon request and advance 
                                payment by the contestant.
                    ``(C) Voluntary paternity acknowledgment.--
                            ``(i) Simple civil process.--Procedures for 
                        a simple civil process for voluntarily 
                        acknowledging paternity under which the State 
                        must provide that, before a mother and a 
                        putative father can sign an acknowledgment of 
                        paternity, the mother and the putative father 
                        must be given notice, orally and in writing, of 
                        the alternatives to, the legal consequences of, 
                        and the rights (including, if 1 parent is a 
                        minor, any rights afforded due to minority 
                        status) and responsibilities that arise from, 
                        signing the acknowledgment.
                            ``(ii) Hospital-based program.--Such 
                        procedures must include a hospital-based 
                        program for the voluntary acknowledgment of 
                        paternity focusing on the period immediately 
                        before or after the birth of a child, subject 
                        to such good cause exceptions, taking into 
                        account the best interests of the child, as the 
                        State may establish.
                            ``(iii) Paternity establishment services.--
                                    ``(I) State-offered services.--Such 
                                procedures must require the State 
                                agency responsible for maintaining 
                                birth records to offer voluntary 
                                paternity establishment services.
                                    ``(II) Regulations.--
                                            ``(aa) Services offered by 
                                        hospitals and birth record 
                                        agencies.--The Secretary shall 
                                        prescribe regulations governing 
                                        voluntary paternity 
                                        establishment services offered 
                                        by hospitals and birth record 
                                        agencies.
                                            ``(bb) Services offered by 
                                        other entities.--The Secretary 
                                        shall prescribe regulations 
                                        specifying the types of other 
                                        entities that may offer 
                                        voluntary paternity 
                                        establishment services, and 
                                        governing the provision of such 
                                        services, which shall include a 
                                        requirement that such an entity 
                                        must use the same notice 
                                        provisions used by, use the 
                                        same materials used by, provide 
                                        the personnel providing such 
                                        services with the same training 
                                        provided by, and evaluate the 
                                        provision of such services in 
                                        the same manner as the 
                                        provision of such services is 
                                        evaluated by, voluntary 
                                        paternity establishment 
                                        programs of hospitals and birth 
                                        record agencies.
                            ``(iv) Use of paternity acknowledgment 
                        affidavit.--Such procedures must require the 
                        State to develop and use an affidavit for the 
                        voluntary acknowledgment of paternity which 
                        includes the minimum requirements of the 
                        affidavit developed by the Secretary under 
                        section 452(a)(7) for the voluntary 
                        acknowledgment of paternity, and to give full 
                        faith and credit to such an affidavit signed in 
                        any other State according to its procedures.
                    ``(D) Status of signed paternity acknowledgment.--
                            ``(i) Inclusion in birth records.--
                        Procedures under which the name of the father 
                        shall be included on the record of birth of the 
                        child of unmarried parents only if--
                                    ``(I) the father and mother have 
                                signed a voluntary acknowledgment of 
                                paternity; or
                                    ``(II) a court or an administrative 
                                agency of competent jurisdiction has 
                                issued an adjudication of paternity.
                        Nothing in this clause precludes a State agency 
                        from obtaining an admission of paternity from 
                        the father for submission in a judicial or 
                        administrative proceeding, or prohibit the 
                        issuance of an order in a judicial or 
                        administrative proceeding which bases a legal 
                        finding of paternity on an admission of 
                        paternity by the father and any other 
                        additional showing required by State law.
                            ``(ii) Legal finding of paternity.-- 
                        Procedures under which a signed voluntary 
                        acknowledgment of paternity is considered a 
                        legal finding of paternity, subject to the 
                        right of any signatory to rescind the 
                        acknowledgment within the earlier of--
                                    ``(I) 60 days; or
                                    ``(II) the date of an 
                                administrative or judicial proceeding 
                                relating to the child (including a 
                                proceeding to establish a support 
                                order) in which the signatory is a 
                                party.
                            ``(iii) Contest.--Procedures under which, 
                        after the 60-day period referred to in clause 
                        (ii), a signed voluntary acknowledgment of 
                        paternity may be challenged in court only on 
                        the basis of fraud, duress, or material mistake 
                        of fact, with the burden of proof upon the 
                        challenger, and under which the legal 
                        responsibilities (including child support 
                        obligations) of any signatory arising from the 
                        acknowledgment may not be suspended during the 
                        challenge, except for good cause shown.
                    ``(E) Bar on acknowledgment ratification 
                proceedings.--Procedures under which judicial or 
                administrative proceedings are not required or 
                permitted to ratify an unchallenged acknowledgment of 
                paternity.
                    ``(F) Admissibility of genetic testing results.--
                Procedures--
                            ``(i) requiring the admission into 
                        evidence, for purposes of establishing 
                        paternity, of the results of any genetic test 
                        that is--
                                    ``(I) of a type generally 
                                acknowledged as reliable by 
                                accreditation bodies designated by the 
                                Secretary; and
                                    ``(II) performed by a laboratory 
                                approved by such an accreditation body;
                            ``(ii) requiring an objection to genetic 
                        testing results to be made in writing not later 
                        than a specified number of days before any 
                        hearing at which the results may be introduced 
                        into evidence (or, at State option, not later 
                        than a specified number of days after receipt 
                        of the results); and
                            ``(iii) making the test results admissible 
                        as evidence of paternity without the need for 
                        foundation testimony or other proof of 
                        authenticity or accuracy, unless objection is 
                        made.
                    ``(G) Presumption of paternity in certain cases.--
                Procedures which create a rebuttable or, at the option 
                of the State, conclusive presumption of paternity upon 
                genetic testing results indicating a threshold 
                probability that the alleged father is the father of 
                the child.
                    ``(H) Default orders.--Procedures requiring a 
                default order to be entered in a paternity case upon a 
                showing of service of process on the defendant and any 
                additional showing required by State law.
                                    ``(I) No right to jury trial.--
                                Procedures providing that the parties 
                                to an action to establish paternity are 
                                not entitled to a trial by jury.
                    ``(J) Temporary support order based on probable 
                paternity in contested cases.--Procedures which require 
                that a temporary order be issued, upon motion by a 
                party, requiring the provision of child support pending 
                an administrative or judicial determination of 
                parentage, if there is clear and convincing evidence of 
                paternity (on the basis of genetic tests or other 
                evidence).
                    ``(K) Proof of certain support and paternity 
                establishment costs.--Procedures under which bills for 
                pregnancy, childbirth, and genetic testing are 
                admissible as evidence without requiring third-party 
                foundation testimony, and shall constitute prima facie 
                evidence of amounts incurred for such services or for 
                testing on behalf of the child.
                    ``(L) Standing of putative fathers.--Procedures 
                ensuring that the putative father has a reasonable 
                opportunity to initiate a paternity action.
                    ``(M) Filing of acknowledgments and adjudications 
                in state registry of birth records.--Procedures under 
                which voluntary acknowledgments and adjudications of 
                paternity by judicial or administrative processes are 
                filed with the State registry of birth records for 
                comparison with information in the State case 
                registry.''.
    (b) National Paternity Acknowledgment Affidavit.--Section 452(a)(7) 
(42 U.S.C. 652(a)(7)) is amended by inserting ``, and develop an 
affidavit to be used for the voluntary acknowledgment of paternity 
which shall include the social security number of each parent and, 
after consultation with the States, other common elements as determined 
by such designee'' before the semicolon.
    (c) Conforming Amendment.--Section 468 (42 U.S.C. 668) is amended 
by striking ``a simple civil process for voluntarily acknowledging 
paternity and''.

SEC. 232. OUTREACH FOR VOLUNTARY PATERNITY ESTABLISHMENT.

    Section 454(23) (42 U.S.C. 654(23)) is amended by inserting ``and 
will publicize the availability and encourage the use of procedures for 
voluntary establishment of paternity and child support by means the 
State deems appropriate'' before the semicolon.

SEC. 233. COOPERATION REQUIREMENT AND GOOD CAUSE EXCEPTION.

    (a) In General.--Section 454 (42 U.S.C. 654), as amended by 
sections 201(b), 203(a), 212(a), and 213(a) of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (27);
            (2) by striking the period at the end of paragraph (28) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (28) the following new 
        paragraph:
            ``(29) provide that the State agency administering the plan 
        under this part--
                    ``(A) will make the determination specified under 
                paragraph (4), as to whether an individual is 
                cooperating with efforts to establish paternity and 
                secure support (or has good cause not to cooperate with 
                such efforts) for purposes of the requirements of 
                sections 403(b)(1)(E)(i) and 1912;
                    ``(B) will advise individuals, both orally and in 
                writing, of the grounds for good cause exceptions to 
                the requirement to cooperate with such efforts;
                    ``(C) will take the best interests of the child 
                into consideration in making the determination whether 
                such individual has good cause not to cooperate with 
                such efforts;
                    ``(D)(i) will make the initial determination as to 
                whether an individual is cooperating (or has good cause 
                not to cooperate) with efforts to establish paternity 
                within 10 days after such individual is referred to 
                such State agency by the State agency administering the 
                program under part A or title XIX;
                            ``(ii) will make redeterminations as to 
                        cooperation or good cause at appropriate 
                        intervals; and
                            ``(iii) will promptly notify the 
                        individual, and the State agencies 
                        administering such programs, of each such 
                        determination and redetermination;
                    ``(E) with respect to any child born on or after 
                the date 10 months after enactment of this provision, 
                will not determine (or redetermine) the mother (or 
                other custodial relative) of such child to be 
                cooperating with efforts to establish paternity unless 
                such individual furnishes--
                            ``(i) the name of the putative father (or 
                        fathers); and
                            ``(ii) sufficient additional information to 
                        enable the State agency, if reasonable efforts 
                        were made, to verify the identity of the person 
                        named as the putative father (including such 
                        information as the putative father's present 
                        address, telephone number, date of birth, past 
                        or present place of employment, school 
                        previously or currently attended, names and 
                        addresses of parents, friends, or relatives 
                        able to provide location information, or other 
                        information that could enable service of 
                        process on such person); and
                    ``(F)(i) (where a custodial parent who was 
                initially determined not to be cooperating (or to have 
                good cause not to cooperate) is later determined to be 
                cooperating or to have good cause not to cooperate) 
                will immediately notify the State agencies 
                administering the programs under part A and title XIX 
                that this eligibility condition has been met; and
                    ``(ii) (where a custodial parent was initially 
                determined to be cooperating (or to have good cause not 
                to cooperate)) will not later determine such individual 
                not to be cooperating (or not to have good cause not to 
                cooperate) until such individual has been afforded an 
                opportunity for a hearing.''.
    (b) Medicaid Amendments.--Section 1912(a) (42 U.S.C. 1396k(a)) is 
amended--
            (1) in paragraph (1)(B), by inserting ``(except as provided 
        in paragraph (2))'' after ``to cooperate with the State'';
            (2) in subparagraphs (B) and (C) of paragraph (1) by 
        striking ``, unless'' and all that follows and inserting a 
        semicolon; and
            (3) by redesignating paragraph (2) as paragraph (6), and 
        inserting after paragraph (1) the following new paragraphs:
            ``(2) provide that the State agency will immediately refer 
        each applicant or recipient requiring paternity establishment 
        services to the State agency administering the program under 
        part D of title IV;
            ``(3) provide that an individual will not be required to 
        cooperate with the State, as provided under paragraph (1), if 
        the individual is found to have good cause for refusing to 
        cooperate, as determined in accordance with standards 
        prescribed by the Secretary, which standards shall take into 
        consideration the best interests of the individuals involved--
                    ``(A) to the satisfaction of the State agency 
                administering the program under part D, as determined 
                in accordance with section 454(29), with respect to the 
                requirements to cooperate with efforts to establish 
                paternity and to obtain support (including medical 
                support) from a parent; and
                    ``(B) to the satisfaction of the State agency 
                administering the program under this title, with 
                respect to other requirements to cooperate under 
                paragraph (1);
            ``(4) provide that (except as provided in paragraph (5)) an 
        applicant requiring paternity establishment services (other 
        than an individual presumptively eligible pursuant to section 
        1920) shall not be eligible for medical assistance under this 
        title until such applicant--
                    ``(i) has furnished to the agency administering the 
                State plan under part D of title IV the information 
                specified in section 454(29)(E); or
                    ``(ii) has been determined by such agency to have 
                good cause not to cooperate; and
            ``(5) provide that the provisions of paragraph (4) shall 
        not apply with respect to an applicant--
                    ``(i) if such agency has not, within 10 days after 
                such individual was referred to such agency, provided 
                the notification required by section 454(29)(D)(iii), 
                until such notification is received; and
                    ``(ii) if such individual appeals a determination 
                that the individual lacks good cause for 
                noncooperation, until after such determination is 
                affirmed after notice and opportunity for a hearing.''.
    (c) Effective Date.--The amendments made by this section are 
effective with respect to applications filed in or after the first 
calendar quarter beginning 10 months or more after the date of the 
enactment of this amendment (or such earlier quarter as the State may 
select) for assistance under a State plan approved under part A of 
title IV of the Social Security Act or for medical assistance under a 
State plan approved under title XIX of such Act.

             Subtitle E--Program Administration and Funding

SEC. 241. PERFORMANCE-BASED INCENTIVES AND PENALTIES.

    (a) Development of New System.--The Secretary of Health and Human 
Services, in consultation with State directors of programs under part D 
of title IV of the Social Security Act, shall develop a new incentive 
system to replace, in a cost neutral manner, the system under section 
458 of such Act. The new system shall provide additional payments to 
any State based on such State's performance under such a program. The 
Secretary shall include procedures that ensure that the 
total incentives paid to all States for a fiscal year under the new 
incentive system do not exceed the total incentives that would have 
been paid to all States for such fiscal year under the system that was 
in effect during fiscal year 1995. Not later than October 1, 1996, the 
Secretary shall report on the new system to the Committee on Ways and 
Means of the House of Representatives and the Committee on Finance of 
the Senate.
    (b) Conforming Amendments to Present System.--Section 458 (42 
U.S.C. 658) is amended--
            (1) in subsection (a), by striking ``aid to families with 
        dependent children under a State plan approved under part A of 
        this title'' and inserting ``assistance under a program funded 
        under part A'';
            (2) in subsection (b)(1)(A), by striking ``section 
        402(a)(26)'' and inserting ``section 402(a)(2)'';
            (3) in subsections (b) and (c)--
                    (A) by striking ``AFDC collections'' each place it 
                appears and inserting ``title IV-A collections'', and
                    (B) by striking ``non-AFDC collections'' each place 
                it appears and inserting ``non-title IV-A 
                collections''; and
            (4) in subsection (c), by striking ``combined AFDC/non-AFDC 
        administrative costs'' both places it appears and inserting 
        ``combined title IV-A/non-title IV-A administrative costs''.
    (c) Calculation of IV-D Paternity Establishment Percentage.--
            (1) Section 452(g)(1)(A) (42 U.S.C. 652(g)(1)(A)) is 
        amended by striking ``75'' and inserting ``90''.
            (2) Section 452(g)(1) (42 U.S.C. 652(g)(1)) is amended by 
        redesignating subparagraphs (B) through (E) as subparagraphs 
        (C) through (F), respectively, and by inserting after 
        subparagraph (A) the following new subparagraph:
                    ``(B) for a State with a paternity establishment 
                percentage of not less than 75 percent but less than 90 
                percent for such fiscal year, the paternity 
                establishment percentage of the State for the 
                immediately preceding fiscal year plus 2 percentage 
                points;''.
            (3) Section 452(g)(2)(A) (42 U.S.C. 652(g)(2)(A)) is 
        amended in the matter preceding clause (i)--
                    (A) by striking ``paternity establishment 
                percentage'' and inserting ``IV-D paternity 
                establishment percentage''; and
                    (B) by striking ``(or all States, as the case may 
                be)''.
            (4) Section 452(g)(2) (42 U.S.C. 652(g)(2)) is amended by 
        adding at the end the following new sentence: ``In meeting the 
        90 percent paternity establishment requirement, a State may 
        calculate either the paternity establishment rate of cases in 
        the program funded under this part or the paternity 
        establishment rate of all out-of-wedlock births in the 
        State.''.
            (5) Section 452(g)(3) (42 U.S.C. 652(g)(3)) is amended--
                    (A) by striking subparagraph (A) and redesignating 
                subparagraphs (B) and (C) as subparagraphs (A) and (B), 
                respectively;
                    (B) in subparagraph (A) (as so redesignated), by 
                striking ``the percentage of children born out-of-
                wedlock in a State'' and inserting ``the percentage of 
                children in a State who are born out of wedlock or for 
                whom support has not been established''; and
                    (C) in subparagraph (B) (as so redesignated) by 
                inserting ``and securing support'' before the period.
    (d) Effective Dates.--
            (1) Incentive adjustments.--
                    (A) In general.--The system developed under 
                subsection (a) and the amendments made by subsection 
                (b) become effective on October 1, 1997, except to the 
                extent provided in subparagraph (B).
                    (B) Application of section 458.--Section 458 of the 
                Social Security Act, as in effect on the day before the 
                date of the enactment of this section, shall be 
                effective for purposes of incentive payments to States 
                for fiscal years before fiscal year 1999.
            (2) Penalty reductions.--The amendments made by subsection 
        (c) become effective with respect to calendar quarters 
        beginning on or after the date of the enactment of this Act.

SEC. 242. FEDERAL AND STATE REVIEWS AND AUDITS.

    (a) State Agency Activities.--Section 454 (42 U.S.C. 654) is 
amended--
            (1) in paragraph (14), by striking ``(14)'' and inserting 
        ``(14)(A)'';
            (2) by redesignating paragraph (15) as subparagraph (B) of 
        paragraph (14); and
            (3) by inserting after paragraph (14) the following new 
        paragraph:
            ``(15) provide for--
                    ``(A) a process for annual reviews of and reports 
                to the Secretary on the State program operated under 
                the State plan approved under this part, including such 
                information as may be necessary to measure State 
                compliance with Federal requirements for expedited 
                procedures, using such standards and procedures as are 
                required by the Secretary, under which the State agency 
                will determine the extent to which the program is 
                operated in compliance with this part; and
                    ``(B) a process of extracting from the automated 
                data processing system required by paragraph (16) and 
                transmitting to the Secretary data and calculations 
                concerning the levels of accomplishment (and rates of 
                improvement) with respect to applicable performance 
                indicators (including IV-D paternity establishment 
                percentages to the extent necessary for purposes of 
                sections 452(g) and 458).''.
    (b) Federal Activities.--Section 452(a)(4) (42 U.S.C. 652(a)(4)) is 
amended to read as follows:
            ``(4)(A) review data and calculations transmitted by State 
        agencies pursuant to section 454(15)(B) on State program 
        accomplishments with respect to performance indicators for 
        purposes of subsection (g) of this section and section 458;
                    ``(B) review annual reports submitted pursuant to 
                section 454(15)(A) and, as appropriate, provide to the 
                State comments, recommendations for additional or 
                alternative corrective actions, and technical 
                assistance; and
                    ``(C) conduct audits, in accordance with the 
                Government auditing standards of the Comptroller 
                General of the United States--
                            ``(i) at least once every 3 years (or more 
                        frequently, in the case of a State which fails 
                        to meet the requirements of this part 
                        concerning performance standards and 
                        reliability of program data) to assess the 
                        completeness, reliability, and security of the 
                        data, and the accuracy of the reporting 
                        systems, used in calculating performance 
                        indicators under subsection (g) of this section 
                        and section 458;
                            ``(ii) of the adequacy of financial 
                        management of the State program operated under 
                        the State plan approved under this part, 
                        including assessments of--
                                    ``(I) whether Federal and other 
                                funds made available to carry out the 
                                State program are being appropriately 
                                expended, and are properly and fully 
                                accounted for; and
                                    ``(II) whether collections and 
                                disbursements of support payments are 
                                carried out correctly and are fully 
                                accounted for; and
                            ``(iii) for such other purposes as the 
                        Secretary may find necessary;''.
    (c) Effective Date.--The amendments made by this section shall be 
effective with respect to calendar quarters beginning 12 months or more 
after the date of the enactment of this Act.

SEC. 243. REQUIRED REPORTING PROCEDURES.

    (a) Establishment.--Section 452(a)(5) (42 U.S.C. 652(a)(5)) is 
amended by inserting ``, and establish procedures to be followed by 
States for collecting and reporting information required to be provided 
under this part, and establish uniform definitions (including those 
necessary to enable the measurement of State compliance with the 
requirements of this part relating to expedited processes) to be 
applied in following such procedures'' before the semicolon.
    (b) State Plan Requirement.--Section 454 (42 U.S.C. 654), as 
amended by sections 201(b), 203(a), 212(a), 213(a), and 233 of this 
Act, is amended--
            (1) by striking ``and'' at the end of paragraph (28);
            (2) by striking the period at the end of paragraph (29) and 
        inserting ``; and''; and
            (3) by adding after paragraph (29) the following new 
        paragraph:
            ``(30) provide that the State shall use the definitions 
        established under section 452(a)(5) in collecting and reporting 
        information as required under this part.''.

SEC. 244. AUTOMATED DATA PROCESSING REQUIREMENTS.

    (a) Revised Requirements.--
            (1) In general.--Section 454(16) (42 U.S.C. 654(16)) is 
        amended--
                    (A) by striking ``, at the option of the State,'';
                    (B) by inserting ``and operation by the State 
                agency'' after ``for the establishment'';
                    (C) by inserting ``meeting the requirements of 
                section 454A'' after ``information retrieval system'';
                    (D) by striking ``in the State and localities 
                thereof, so as (A)'' and inserting ``so as'';
                    (E) by striking ``(i)''; and
                    (F) by striking ``(including'' and all that follows 
                and inserting a semicolon.
            (2) Automated data processing.--Part D of title IV (42 
        U.S.C. 651-669) is amended by inserting after section 454 the 
        following new section:

``SEC. 454A. AUTOMATED DATA PROCESSING.

    ``(a) In General.--In order for a State to meet the requirements of 
this section, the State agency administering the State program under 
this part shall have in operation a single statewide automated data 
processing and information retrieval system which has the capability to 
perform the tasks specified in this section with the frequency and in 
the manner required by or under this part.
    ``(b) Program Management.--The automated system required by this 
section shall perform such functions as the Secretary may specify 
relating to management of the State program under this part, 
including--
            ``(1) controlling and accounting for use of Federal, State, 
        and local funds in carrying out the program; and
            ``(2) maintaining the data necessary to meet Federal 
        reporting requirements under this part on a timely basis.
    ``(c) Calculation of Performance Indicators.--In order to enable 
the Secretary to determine the incentive payments and penalty 
adjustments required by sections 452(g) and 458, the State agency 
shall--
            ``(1) use the automated system--
                    ``(A) to maintain the requisite data on State 
                performance with respect to paternity establishment and 
                child support enforcement in the State; and
                    ``(B) to calculate the IV-D paternity establishment 
                percentage for the State for each fiscal year; and
            ``(2) have in place systems controls to ensure the 
        completeness and reliability of, and ready access to, the data 
        described in paragraph (1)(A), and the accuracy of the 
        calculations described in paragraph (1)(B).
    ``(d) Information Integrity and Security.--The State agency shall 
have in effect safeguards on the integrity, accuracy, and completeness 
of, access to, and use of data in the automated system required by this 
section, which shall include the following (in addition to such other 
safeguards as the Secretary may specify in regulations):
            ``(1) Policies restricting access.--Written policies 
        concerning access to data by State agency personnel, and 
        sharing of data with other persons, which--
                    ``(A) permit access to and use of data only to the 
                extent necessary to carry out the State program under 
                this part; and
                    ``(B) specify the data which may be used for 
                particular program purposes, and the personnel 
                permitted access to such data.
            ``(2) Systems controls.--Systems controls (such as 
        passwords or blocking of fields) to ensure strict adherence to 
        the policies described in paragraph (1).
            ``(3) Monitoring of access.--Routine monitoring of access 
        to and use of the automated system, through methods such as 
        audit trails and feedback mechanisms, to guard against and 
        promptly identify unauthorized access or use.
            ``(4) Training and information.--Procedures to ensure that 
        all personnel (including State and local agency staff and 
        contractors) who may have access to or be required to use 
        confidential program data are informed of applicable 
        requirements and penalties (including those in section 6103 of 
        the Internal Revenue Code of 1986), and are adequately trained 
        in security procedures.
            ``(5) Penalties.--Administrative penalties (up to and 
        including dismissal from employment) for unauthorized access 
        to, or disclosure or use of, confidential data.''.
            (3) Regulations.--The Secretary of Health and Human 
        Services shall prescribe final regulations for implementation 
        of section 454A of the Social Security Act not later than 2 
        years after the date of the enactment of this Act.
            (4) Implementation timetable.--Section 454(24) (42 U.S.C. 
        654(24)), as amended by section 203(a)(1) of this Act, is 
        amended to read as follows:
            ``(24) provide that the State will have in effect an 
        automated data processing and information retrieval system--
                    ``(A) by October 1, 1997, which meets all 
                requirements of this part which were enacted on or 
                before the date of enactment of the Family Support Act 
                of 1988, and
                    ``(B) by October 1, 1999, which meets all 
                requirements of this part enacted on or before the date 
                of the enactment of this Act, except that such deadline 
                shall be extended by 1 day for each day (if any) by 
                which the Secretary fails to meet the deadline imposed 
                by section 244(a)(3) of the Work First and Personal 
                Responsibility Act of 1996;''.
    (b) Special Federal Matching Rate for Development Costs of 
Automated Systems.--
            (1) In general.--Section 455(a) (42 U.S.C. 655(a)) is 
        amended--
                    (A) in paragraph (1)(B)--
                            (i) by striking ``90 percent'' and 
                        inserting ``the percent specified in paragraph 
                        (3), subect to the limitations in paragraph 
                        (3)'';
                            (ii) by striking ``so much of''; and
                            (iii) by striking ``which the Secretary'' 
                        and all that follows and inserting ``, and''; 
                        and
                    (B) by adding at the end the following new 
                paragraph:
            ``(3)(A) Subject to the limitation in subparagraph (C), the 
        Secretary shall pay to each State, for each quarter in fiscal 
        years 1996 and 1997, 90 percent of so much of the State 
        expenditures described in paragraph (1)(B) as the Secretary 
        finds are for a system meeting the requirements specified in 
        section 454(16) (as in effect on September 30, 1995), but 
        limited to the amount approved for States in the advance 
        planning documents of such States submitted on or before May 1, 
        1995.
                    ``(B) Subject to the limitation in subparagraph 
                (C), the Secretary shall pay to each State, for each 
                quarter in fiscal years 1996 through 2001, 80 percent 
                of so much of the State expenditures described in 
                paragraph (1)(B) (other than expenditures with respect 
                to which payment is made under subparagraph (A)) as the 
                Secretary finds are for a system meeting the 
                requirements of sections 454(16) and 454A.
                    ``(C) Limitation on payments under temporary 
                special federal matching rate.--
                            ``(i) In general.--The Secretary of Health 
                        and Human Services may not pay more than 
                        $400,000,000 in the aggregate under this 
                        paragraph for fiscal years 1996 through 2001, 
                        which is the maximum amount to which States may 
                        be entitled under this paragraph for such 
                        fiscal period.
                            ``(ii) Allocation of limitation among 
                        states.--The total amount payable to a State 
                        under this paragraph for fiscal years 1996 
                        through 2001 shall not exceed the limitation 
                        determined for the State by the Secretary of 
                        Health and Human Services in regulations.
                            ``(iii) Allocation formula.--The 
                        regulations referred to in clause (ii) shall 
                        prescribe a formula for allocating the amount 
                        specified in clause (i) among States with plans 
                        approved under part D of title IV of the Social 
                        Security Act, which shall take into account--
                                    ``(I) the relative size of State 
                                caseloads under such part; and
                                    ``(II) the level of automation 
                                needed to meet the automated data 
                                processing requirements of such 
                                part.''.
    (c) Subsection (b) of this section is repealed effective September 
30, 2001.
    (d) Conforming Amendment.--Section 123(c) of the Family Support Act 
of 1988 (102 Stat. 2352; Public Law 100-485) is amended by striking 
``1995'' and inserting ``2001''.

SEC. 245. TECHNICAL ASSISTANCE.

    (a) For Training of Federal and State Staff, Research and 
Demonstration Programs, and Special Projects of Regional or National 
Significance.--Section 452 (42 U.S.C. 652) is amended by adding at the 
end the following new subsection:
    ``(j) From the appropriation account providing funds for payments 
to States under section 455(a) for a fiscal year, the Secretary may use 
an amount not to exceed 0.5 percent of reimbursements by States to the 
Federal Government pursuant to section 457(a) during the preceding 
fiscal year (as determined on the basis of the most recent reliable 
data available to the Secretary as of the end of the 3rd calendar 
quarter following the end of such preceding fiscal year), to cover 
costs incurred by the Secretary for--
            ``(1) information dissemination and technical assistance to 
        States, training of State and Federal staff, staffing studies, 
        and related activities needed to improve programs under this 
        part (including technical assistance concerning State automated 
        systems required by this part); and
            ``(2) research, demonstration, and special projects of 
        regional or national significance relating to the operation of 
        State programs under this part.''.
    (b) Operation of Federal Parent Locator Service.--Section 453 (42 
U.S.C. 653), as amended by section 216 of this Act, is amended by 
adding at the end the following new subsection:
    ``(o) Recovery of Costs.--From the appropriation account providing 
funds for payments to States for under section 455(a), the Secretary 
may use an amount not to exceed 2 percent of the total reimbursements 
by States to the Federal Government pursuant to section 457(a) during 
the preceding fiscal year (as determined on the basis of the most 
recent reliable data available to the Secretary as of the end of the 
3rd calendar quarter following the end of such preceding fiscal year), 
to cover costs incurred by the Secretary for operation of the Federal 
Parent Locator Service under this section, to the extent such costs are 
not recovered through user fees.''.

SEC. 246. REPORTS AND DATA COLLECTION BY THE SECRETARY.

    (a) Annual Report to Congress.--
            (1) Section 452(a)(10)(A) (42 U.S.C. 652(a)(10)(A)) is 
        amended--
                    (A) by striking ``this part;'' and inserting ``this 
                part, including--''; and
                    (B) by adding at the end the following new clauses:
                            ``(i) the total amount of child support 
                        payments collected as a result of services 
                        furnished during the fiscal year to individuals 
                        receiving services under this part;
                            ``(ii) the cost to the States and to the 
                        Federal Government of so furnishing the 
                        services; and
                            ``(iii) the number of cases involving 
                        families--
                                    ``(I) who became ineligible for 
                                assistance under State programs funded 
                                under part A during a month in the 
                                fiscal year; and
                                    ``(II) with respect to whom a child 
                                support payment was received in the 
                                month;''.
            (2) Section 452(a)(10)(C) (42 U.S.C. 652(a)(10)(C)) is 
        amended--
                    (A) in the matter preceding clause (i)--
                            (i) by striking ``with the data required 
                        under each clause being separately stated for 
                        cases'' and inserting ``separately stated for 
                        (1) cases'';
                            (ii) by striking ``cases where the child 
                        was formerly receiving'' and inserting ``or 
                        formerly received'';
                            (iii) by inserting ``or 1912'' after 
                        ``471(a)(17)''; and
                            (iv) by inserting ``(2)'' before ``all 
                        other'';
                    (B) in each of clauses (i) and (ii), by striking 
                ``, and the total amount of such obligations'';
                    (C) in clause (iii), by striking ``described in'' 
                and all that follows and inserting ``in which support 
                was collected during the fiscal year;'';
                    (D) by striking clause (iv); and
                    (E) by redesignating clause (v) as clause (vii), 
                and inserting after clause (iii) the following new 
                clauses:
                            ``(iv) the total amount of support 
                        collected during such fiscal year and 
                        distributed as current support;
                            ``(v) the total amount of support collected 
                        during such fiscal year and distributed as 
                        arrearages;
                            ``(vi) the total amount of support due and 
                        unpaid for all fiscal years; and''.
            (3) Section 452(a)(10)(G) (42 U.S.C. 652(a)(10)(G)) is 
        amended by striking ``on the use of Federal courts and''.
            (4) Section 452(a)(10) (42 U.S.C. 652(a)(10)) is amended--
                    (A) in subparagraph (H), by striking ``and'';
                    (B) in subparagraph (I), by striking the period and 
                inserting ``; and''; and
                    (C) by inserting after subparagraph (I) the 
                following new subparagraph:
                    ``(J) compliance, by State, with the standards 
                established pursuant to subsections (h) and (i).''.
            (5) Section 452(a)(10) (42 U.S.C. 652(a)(10)) is amended by 
        striking all that follows subparagraph (J), as added by 
        paragraph (4).
    (b) Effective Date.--The amendments made by subsection (a) are 
effective with respect to fiscal year 1996 and succeeding fiscal years.

      Subtitle F--Establishment and Modification of Support Orders

SEC. 251. SIMPLIFIED PROCESS FOR REVIEW AND ADJUSTMENT OF CHILD SUPPORT 
              ORDERS.

    Section 466(a)(10) (42 U.S.C. 666(a)(10)) is amended to read as 
follows:
            ``(10) Review and adjustment of support orders upon 
        request.--Procedures under which the State shall review and 
        adjust each support order being enforced under this part if 
        there is an assignment under part A or upon the request of 
        either parent. Such procedures shall provide the following:
                    ``(A) In general.--
                            ``(i) 3-year cycle.--Except as provided in 
                        subparagraphs (B) and (C), the State shall 
                        review and, as appropriate, adjust the support 
                        order every 3 years, taking into account the 
                        best interests of the child involved.
                            ``(ii) Methods of adjustment.--The State 
                        may elect to review and, if appropriate, adjust 
                        an order pursuant to clause (i) by--
                                    ``(I) reviewing and, if 
                                appropriate, adjusting the order in 
                                accordance with the guidelines 
                                established pursuant to section 467(a) 
                                if the amount of the child support 
                                award under the order differs from the 
                                amount that would be awarded in 
                                accordance with the guidelines; or
                                    ``(II) applying a cost-of-living 
                                adjustment to the order in accordance 
                                with a formula developed by the State 
                                and permit either party to contest the 
                                adjustment, within 30 days after the 
                                date of the notice of the adjustment, 
                                by making a request for review and, if 
                                appropriate, adjustment of the order in 
                                accordance with the child support 
                                guidelines established pursuant to 
                                section 467(a).
                            ``(iii) No proof of change in circumstances 
                        necessary.--Any adjustment under this 
                        subparagraph (A) shall be made without a 
                        requirement for proof or showing of a change in 
                        circumstances.
                    ``(B) Automated method.--The State may use 
                automated methods (including automated comparisons with 
                wage or State income tax data) to identify orders 
                eligible for review, conduct the review, identify 
                orders eligible for adjustment, and apply the 
                appropriate adjustment to the orders eligible for 
                adjustment under the threshold established by the 
                State.
                    ``(C) Request upon substantial change in 
                circumstances.--The State shall, at the request of 
                either parent subject to such an order or of any State 
                child support enforcement agency, review and, if 
                appropriate, adjust the order in accordance with the 
                guidelines established pursuant to section 467(a) based 
                upon a substantial change in the circumstances of 
                either parent.
                    ``(D) Notice of right to review.--The State shall 
                provide notice not less than once every 3 years to the 
                parents subject to such an order informing them of 
                their right to request the State to review and, if 
                appropriate, adjust the order pursuant to this 
                paragraph. The notice may be included in the order.''.

SEC. 252. FURNISHING CONSUMER REPORTS FOR CERTAIN PURPOSES RELATING TO 
              CHILD SUPPORT.

    Section 604 of the Fair Credit Reporting Act (15 U.S.C. 1681b) is 
amended by adding at the end the following new paragraphs:
            ``(4) In response to a request by the head of a State or 
        local child support enforcement agency (or a State or local 
        government official authorized by the head of such an agency), 
        if the person making the request certifies to the consumer 
        reporting agency that--
                    ``(A) the consumer report is needed for the purpose 
                of establishing an individual's capacity to make child 
                support payments or determining the appropriate level 
                of such payments;
                    ``(B) the paternity of the consumer for the child 
                to which the obligation relates has been established or 
                acknowledged by the consumer in accordance with State 
                laws under which the obligation arises (if required by 
                those laws);
                    ``(C) the person has provided at least 10 days' 
                prior notice to the consumer whose report is requested, 
                by certified or registered mail to the last known 
                address of the consumer, that the report will be 
                requested; and
                    ``(D) the consumer report will be kept 
                confidential, will be used solely for a purpose 
                described in subparagraph (A), and will not be used in 
                connection with any other civil, administrative, or 
                criminal proceeding, or for any other purpose.
            ``(5) To an agency administering a State plan under section 
        454 of the Social Security Act (42 U.S.C. 654) for use to set 
        an initial or modified child support award.''.

SEC. 253. NONLIABILITY FOR FINANCIAL INSTITUTIONS PROVIDING FINANCIAL 
              RECORDS TO STATE CHILD SUPPORT ENFORCEMENT AGENCIES IN 
              CHILD SUPPORT CASES.

    (a) In General.--Notwithstanding any other provision of Federal or 
State law, a financial institution shall not be liable under any 
Federal or State law to any person for disclosing any financial record 
of an individual to a State child support enforcement agency attempting 
to establish, modify, or enforce a child support obligation of such 
individual.
    (b) Prohibition of Disclosure of Financial Record Obtained by State 
Child Support Enforcement Agency.--A State child support enforcement 
agency which obtains a financial record of an individual from a 
financial institution pursuant to subsection (a) may disclose such 
financial record only for the purpose of establishing, modifying, or 
enforcing a child support obligation of that individual.
    (c) Civil Damages for Unauthorized Disclosure.--
            (1) Disclosure by state officer or employee.--If any person 
        knowingly or negligently discloses a financial record of an 
        individual in violation of subsection (b), such individual may 
        bring a civil action for damages against such person in a 
        district court of the United States.
            (2) No liability for good faith but erroneous 
        interpretation.--No liability shall arise under this subsection 
        with respect to any disclosure which results from a good faith, 
        but erroneous, interpretation of subsection (b).
            (3) Damages.--In any action brought under paragraph (1), 
        upon a finding of liability on the part of the defendant, the 
        defendant shall be liable to the plaintiff in an amount equal 
        to the sum of--
                    (A) the greater of--
                            (i) $1,000 for each act of unauthorized 
                        disclosure of a financial record with respect 
                        to which such defendant is found liable; or
                            (ii) the sum of--
                                    (I) the actual damages sustained by 
                                the plaintiff as a result of such 
                                unauthorized disclosure; plus
                                    (II) in the case of a willful 
                                disclosure or a disclosure which is the 
                                result of gross negligence, punitive 
                                damages; plus
                    (B) the costs (including attorney's fees) of the 
                action.
    (d) Definitions.--For purposes of this section--
            (1) Financial institution.--The term ``financial 
        institution'' means--
                    (A) a depository institution, as defined in section 
                3(c) of the Federal Deposit Insurance Act (12 U.S.C. 
                1813(c));
                    (B) an institution-affiliated party, as defined in 
                section 3(u) of such Act (12 U.S.C. 1813(v));
                    (C) any Federal credit union or State credit union, 
                as defined in section 101 of the Federal Credit Union 
                Act (12 U.S.C. 1752), including an institution-
                affiliated party of such a credit union, as defined in 
                section 206(r) of such Act (12 U.S.C. 1786(r)); and
                    (D) any benefit association, insurance company, 
                safe deposit company, money-market mutual fund, or 
                similar entity authorized to do business in the State.
            (2) Financial record.--The term ``financial record'' has 
        the meaning given such term in section 1101 of the Right to 
        Financial Privacy Act of 1978 (12 U.S.C. 3401).
            (3) State child support enforcement agency.--The term 
        ``State child support enforcement agency'' means a State agency 
        which administers a State program for establishing and 
        enforcing child support obligations.

               Subtitle G--Enforcement of Support Orders

SEC. 261. INTERNAL REVENUE SERVICE COLLECTION OF ARREARAGES.

    (a) Collection of Fees.--Section 6305(a) of the Internal Revenue 
Code of 1986 (relating to collection of certain liability) is amended--
            (1) by striking ``and'' at the end of paragraph (3);
            (2) by striking the period at the end of paragraph (4) and 
        inserting ``, and'';
            (3) by adding at the end the following new paragraph:
            ``(5) no additional fee may be assessed for adjustments to 
        an amount previously certified pursuant to such section 452(b) 
        with respect to the same obligor.''; and
            (4) by striking ``Secretary of Health, Education, and 
        Welfare'' each place it appears and inserting ``Secretary of 
        Health and Human Services''.
    (b) Effective Date.--The amendments made by this section become 
effective October 1, 1997.

SEC. 262. AUTHORITY TO COLLECT SUPPORT FROM FEDERAL EMPLOYEES.

    (a) Consolidation and Streamlining of Authorities.--Section 459 (42 
U.S.C. 659) is amended to read as follows:

``SEC. 459. CONSENT BY THE UNITED STATES TO INCOME WITHHOLDING, 
              GARNISHMENT, AND SIMILAR PROCEEDINGS FOR ENFORCEMENT OF 
              CHILD SUPPORT AND ALIMONY OBLIGATIONS.

    ``(a) Consent to Support Enforcement.--Notwithstanding any other 
provision of law (including section 207 of this Act and section 5301 of 
title 38, United States Code), effective January 1, 1975, moneys (the 
entitlement to which is based upon remuneration for employment) due 
from, or payable by, the United States or the District of Columbia 
(including any agency, subdivision, or instrumentality thereof) to any 
individual, including members of the Armed Forces of the United States, 
shall be subject, in like manner and to the same extent as if the 
United States or the District of Columbia were a private person, to 
withholding in accordance with State law enacted pursuant to 
subsections (a)(1) and (b) of section 466 and regulations of the 
Secretary under such subsections, and to any other legal process 
brought, by a State agency administering a program under a State plan 
approved under this part or by an individual obligee, to enforce the 
legal obligation of the individual to provide child support or alimony.
    ``(b) Consent to Requirements Applicable to Private Person.--With 
respect to notice to withhold income pursuant to subsection (a)(1) or 
(b) of section 466, or any other order or process to enforce support 
obligations against an individual (if the order or process contains or 
is accompanied by sufficient data to permit prompt identification of 
the individual and the moneys involved), each governmental entity 
specified in subsection (a) shall be subject to the same requirements 
as would apply if the entity were a private person, except as otherwise 
provided in this section.
    ``(c) Designation of Agent; Response to Notice or Process.--
            ``(1) Designation of agent.--The head of each agency 
        subject to this section shall--
                    ``(A) designate an agent or agents to receive 
                orders and accept service of process in matters 
                relating to child support or alimony; and
                    ``(B) annually publish in the Federal Register the 
                designation of the agent or agents, identified by title 
                or position, mailing address, and telephone number.
            ``(2) Response to notice or process.--If an agent 
        designated pursuant to paragraph (1) of this subsection 
        receives notice pursuant to State procedures in effect pursuant 
        to subsection (a)(1) or (b) of section 466, or is effectively 
        served with any order, process, or interrogatory, with respect 
        to an individual's child support or alimony payment 
        obligations, the agent shall--
                    ``(A) as soon as possible (but not later than 15 
                days) thereafter, send written notice of the notice or 
                service (together with a copy of the notice or service) 
                to the individual at the duty station or last-known 
                home address of the individual;
                    ``(B) within 30 days (or such longer period as may 
                be prescribed by applicable State law) after receipt of 
                a notice pursuant to such State procedures, comply with 
                all applicable provisions of section 466; and
                    ``(C) within 30 days (or such longer period as may 
                be prescribed by applicable State law) after effective 
                service of any other such order, process, or 
                interrogatory, respond to the order, process, or 
                interrogatory.
    ``(d) Priority of Claims.--If a governmental entity specified in 
subsection (a) receives notice or is served with process, as provided 
in this section, concerning amounts owed by an individual to more than 
1 person--
            ``(1) support collection under section 466(b) must be given 
        priority over any other process, as provided in section 
        466(b)(7);
            ``(2) allocation of moneys due or payable to an individual 
        among claimants under section 466(b) shall be governed by 
        section 466(b) and the regulations prescribed under such 
        section; and
            ``(3) such moneys as remain after compliance with 
        paragraphs (1) and (2) shall be available to satisfy any other 
        such processes on a first-come, first-served basis, with any 
        such process being satisfied out of such moneys as remain after 
        the satisfaction of all such processes which have been 
        previously served.
    ``(e) No Requirement To Vary Pay Cycles.--A governmental entity 
that is affected by legal process served for the enforcement of an 
individual's child support or alimony payment obligations shall not be 
required to vary its normal pay and disbursement cycle in order to 
comply with the legal process.
    ``(f) Relief From Liability.--
            ``(1) Neither the United States, nor the government of the 
        District of Columbia, nor any disbursing officer shall be 
        liable with respect to any payment made from moneys due or 
        payable from the United States to any individual pursuant to 
        legal process regular on its face, if the payment is made in 
        accordance with this section and the regulations issued to 
        carry out this section.
            ``(2) No Federal employee whose duties include taking 
        actions necessary to comply with the requirements of subsection 
        (a) with regard to any individual shall be subject under any 
        law to any disciplinary action or civil or criminal liability 
        or penalty for, or on account of, any disclosure of information 
        made by the employee in connection with the carrying out of 
        such actions.
    ``(g) Regulations.--Authority to promulgate regulations for the 
implementation of this section shall, insofar as this section applies 
to moneys due from (or payable by)--
            ``(1) the United States (other than the legislative or 
        judicial branches of the Federal Government) or the government 
        of the District of Columbia, be vested in the President (or the 
        designee of the President);
            ``(2) the legislative branch of the Federal Government, be 
        vested jointly in the President pro tempore of the Senate and 
        the Speaker of the House of Representatives (or their 
        designees), and
            ``(3) the judicial branch of the Federal Government, be 
        vested in the Chief Justice of the United States (or the 
        designee of the Chief Justice).
    ``(h) Moneys Subject to Process.--
            ``(1) In general.--Subject to paragraph (2), moneys paid or 
        payable to an individual which are considered to be based upon 
        remuneration for employment, for purposes of this section--
                    ``(A) consist of--
                            ``(i) compensation paid or payable for 
                        personal services of the individual, whether 
                        the compensation is denominated as wages, 
                        salary, commission, bonus, pay, allowances, or 
                        otherwise (including severance pay, sick pay, 
                        and incentive pay);
                            ``(ii) periodic benefits (including a 
                        periodic benefit as defined in section 
                        228(h)(3)) or other payments--
                                    ``(I) under the insurance system 
                                established by title II;
                                    ``(II) under any other system or 
                                fund established by the United States 
                                which provides for the payment of 
                                pensions, retirement or retired pay, 
                                annuities, dependents' or survivors' 
                                benefits, or similar amounts payable on 
                                account of personal services performed 
                                by the individual or any other 
                                individual;
                                    ``(III) as compensation for death 
                                under any Federal program;
                                    ``(IV) under any Federal program 
                                established to provide `black lung' 
                                benefits; or
                                    ``(V) by the Secretary of Veterans 
                                Affairs as compensation for a service-
                                connected disability paid by the 
                                Secretary to a former member of the 
                                Armed Forces who is in receipt of 
                                retired or retainer pay if the former 
                                member has waived a portion of the 
                                retired or retainer pay in order to 
                                receive such compensation; and
                            ``(iii) worker's compensation benefits paid 
                        under Federal or State law but
                    ``(B) do not include any payment--
                            ``(i) by way of reimbursement or otherwise, 
                        to defray expenses incurred by the individual 
                        in carrying out duties associated with the 
                        employment of the individual; or
                            ``(ii) as allowances for members of the 
                        uniformed services payable pursuant to chapter 
                        7 of title 37, United States Code, as 
                        prescribed by the Secretaries concerned 
                        (defined by section 101(5) of such title) as 
                        necessary for the efficient performance of 
                        duty.
            ``(2) Certain amounts excluded.--In determining the amount 
        of any moneys due from, or payable by, the United States to any 
        individual, there shall be excluded amounts which--
                    ``(A) are owed by the individual to the United 
                States;
                    ``(B) are required by law to be, and are, deducted 
                from the remuneration or other payment involved, 
                including Federal employment taxes, and fines and 
                forfeitures ordered by court-martial;
                    ``(C) are properly withheld for Federal, State, or 
                local income tax purposes, if the withholding of the 
                amounts is authorized or required by law and if amounts 
                withheld are not greater than would be the case if the 
                individual claimed all dependents to which he was 
                entitled (the withholding of additional amounts 
                pursuant to section 3402(i) of the Internal Revenue 
                Code of 1986 may be permitted only when the individual 
                presents evidence of a tax obligation which supports 
                the additional withholding);
                    ``(D) are deducted as health insurance premiums;
                    ``(E) are deducted as normal retirement 
                contributions (not including amounts deducted for 
                supplementary coverage); or
                    ``(F) are deducted as normal life insurance 
                premiums from salary or other remuneration for 
                employment (not including amounts deducted for 
                supplementary coverage).
    ``(i) Definitions.--For purposes of this section--
            ``(1) United states.--The term `United States' includes any 
        department, agency, or instrumentality of the legislative, 
        judicial, or executive branch of the Federal Government, the 
        United States Postal Service, the Postal Rate Commission, any 
        Federal corporation created by an Act of Congress that is 
        wholly owned by the Federal Government, and the governments of 
        the territories and possessions of the United States.
            ``(2) Child support.--The term `child support', when used 
        in reference to the legal obligations of an individual to 
        provide such support, means amounts required to be paid under a 
        judgment, decree, or order, whether temporary, final, or 
        subject to modification, issued by a court or an administrative 
        agency of competent jurisdiction, for the support and 
        maintenance of a child, including a child who has attained the 
        age of majority under the law of the issuing State, or a child 
        and the parent with whom the child is living, which provides 
        for monetary support, health care, arrearages or reimbursement, 
        and which may include other related costs and fees, interest 
        and penalties, income withholding, attorney's fees, and other 
        relief.
            ``(3) Alimony.--
                    ``(A) In general.--The term `alimony', when used in 
                reference to the legal obligations of an individual to 
                provide the same, means periodic payments of funds for 
                the support and maintenance of the spouse (or former 
                spouse) of the individual, and (subject to and in 
                accordance with State law) includes separate 
                maintenance, alimony pendente lite, maintenance, and 
                spousal support, and includes attorney's fees, 
                interest, and court costs when and to the extent that 
                the same are expressly made recoverable as such 
                pursuant to a decree, order, or judgment issued in 
                accordance with applicable State law by a court of 
                competent jurisdiction.
                    ``(B) Exceptions.--Such term does not include--
                            ``(i) any child support; or
                            ``(ii) any payment or transfer of property 
                        or its value by an individual to the spouse or 
                        a former spouse of the individual in compliance 
                        with any community property settlement, 
                        equitable distribution of property, or other 
                        division of property between spouses or former 
                        spouses.
            ``(4) Private person.--The term `private person' means a 
        person who does not have sovereign or other special immunity or 
        privilege which causes the person not to be subject to legal 
        process.
            ``(5) Legal process.--The term `legal process' means any 
        writ, order, summons, or other similar process in the nature of 
        garnishment--
                    ``(A) which is issued by--
                            ``(i) a court or an administrative agency 
                        of competent jurisdiction in any State, 
                        territory, or possession of the United States;
                            ``(ii) a court or an administrative agency 
                        of competent jurisdiction in any foreign 
                        country with which the United States has 
                        entered into an agreement which requires the 
                        United States to honor the process; or
                            ``(iii) an authorized official pursuant to 
                        an order of such a court or an administrative 
                        agency of competent jurisdiction or pursuant to 
State or local law; and
                    ``(B) which is directed to, and the purpose of 
                which is to compel, a governmental entity which holds 
                moneys which are otherwise payable to an individual to 
                make a payment from the moneys to another party in 
                order to satisfy a legal obligation of the individual 
                to provide child support or make alimony payments.''.
    (b) Conforming Amendments.--
            (1) To part d of title iv.--Sections 461 and 462 (42 U.S.C. 
        661 and 662) are repealed.
            (2) To title 5, united states code.--Section 5520a of title 
        5, United States Code, is amended, in subsections (h)(2) and 
        (i), by striking ``sections 459, 461, and 462 of the Social 
        Security Act (42 U.S.C. 659, 661, and 662)'' and inserting 
        ``section 459 of the Social Security Act (42 U.S.C. 659)''.
    (c) Military Retired and Retainer Pay.--
            (1) Definition of court.--Section 1408(a)(1) of title 10, 
        United States Code, is amended--
                    (A) by striking ``and'' at the end of subparagraph 
                (B);
                    (B) by striking the period at the end of 
                subparagraph (C) and inserting ``; and''; and
                    (C) by adding after subparagraph (C) the following: 
                new subparagraph:
                    ``(D) any administrative or judicial tribunal of a 
                State competent to enter orders for support or 
                maintenance (including a State agency administering a 
                program under a State plan approved under part D of 
                title IV of the Social Security Act), and, for purposes 
                of this subparagraph, the term `State' includes the 
                District of Columbia, the Commonwealth of Puerto Rico, 
                the Virgin Islands, Guam, and American Samoa.''.
            (2) Definition of court order.--Section 1408(a)(2) of such 
        title is amended--
                    (A) by inserting ``or a support order, as defined 
                in section 453(p) of the Social Security Act (42 U.S.C. 
                653(p)),'' before ``which--'';
                    (B) in subparagraph (B)(i), by striking ``(as 
                defined in section 462(b) of the Social Security Act 
                (42 U.S.C. 662(b)))'' and inserting ``(as defined in 
                section 459(i)(2) of the Social Security Act (42 U.S.C. 
                662(i)(2)))''; and
                    (C) in subparagraph (B)(ii), by striking ``(as 
                defined in section 462(c) of the Social Security Act 
                (42 U.S.C. 662(c)))'' and inserting ``(as defined in 
                section 459(i)(3) of the Social Security Act (42 U.S.C. 
                662(i)(3)))''.
            (3) Public payee.--Section 1408(d) of such title is 
        amended--
                    (A) in the heading, by inserting ``(or for benefit 
                of)'' before ``Spouse or''; and
                    (B) in paragraph (1), in the 1st sentence, by 
                inserting ``(or for the benefit of such spouse or 
                former spouse to a State disbursement unit established 
                pursuant to section 454B of the Social Security Act or 
                other public payee designated by a State, in accordance 
                with part D of title IV of the Social Security Act, as 
                directed by court order, or as otherwise directed in 
                accordance with such part D)'' before ``in an amount 
                sufficient''.
            (4) Relationship to part d of title iv.--Section 1408 of 
        such title is amended by adding at the end the following new 
        subsection:
    ``(j) Relationship to Other Laws.--In any case involving an order 
providing for payment of child support (as defined in section 459(i)(2) 
of the Social Security Act) by a member who has never been married to 
the other parent of the child, the provisions of this section shall not 
apply, and the case shall be subject to the provisions of section 459 
of such Act.''.
    (d) Effective Date.--The amendments made by this section become 
effective 6 months after the date of the enactment of this Act.

SEC. 263. ENFORCEMENT OF CHILD SUPPORT OBLIGATIONS OF MEMBERS OF THE 
              ARMED FORCES.

    (a) Availability of Locator Information.--
            (1) Maintenance of address information.--The Secretary of 
        Defense shall establish a centralized personnel locator service 
        that includes the address of each member of the Armed Forces 
        under the jurisdiction of the Secretary. Upon request of the 
        Secretary of Transportation, addresses for members of the Coast 
        Guard shall be included in the centralized personnel locator 
        service.
            (2) Type of address.--
                    (A) Residential address.--Except as provided in 
                subparagraph (B), the address for a member of the Armed 
Forces shown in the locator service shall be the residential address of 
that member.
                    (B) Duty address.--The address for a member of the 
                Armed Forces shown in the locator service shall be the 
                duty address of that member in the case of a member--
                            (i) who is permanently assigned overseas, 
                        to a vessel, or to a routinely deployable unit; 
                        or
                            (ii) with respect to whom the Secretary 
                        concerned makes a determination that the 
                        member's residential address should not be 
                        disclosed due to national security or safety 
                        concerns.
            (3) Updating of locator information.--Within 30 days after 
        a member listed in the locator service establishes a new 
        residential address (or a new duty address, in the case of a 
        member covered by paragraph (2)(B)), the Secretary concerned 
        shall update the locator service to indicate the new address of 
        the member.
            (4) Availability of information.--The Secretary of Defense 
        shall make information regarding the address of a member of the 
        Armed Forces listed in the locator service available, on 
        request, to the Federal Parent Locator Service established 
        under section 453 of the Social Security Act.
    (b) Facilitating Granting of Leave for Attendance at Hearings.--
            (1) Regulations.--The Secretary of each military 
        department, and the Secretary of Transportation with respect to 
        the Coast Guard when it is not operating as a service in the 
        Navy, shall prescribe regulations to facilitate the granting of 
        leave to a member of the Armed Forces under the jurisdiction of 
        that Secretary in a case in which--
                    (A) the leave is needed for the member to attend a 
                hearing described in paragraph (2);
                    (B) the member is not serving in or with a unit 
                deployed in a contingency operation (as defined in 
                section 101 of title 10, United States Code); and
                    (C) the exigencies of military service (as 
                determined by the Secretary concerned) do not otherwise 
                require that such leave not be granted.
            (2) Covered hearings.--Paragraph (1) applies to a hearing 
        that is conducted by a court or pursuant to an administrative 
        process established under State law, in connection with a civil 
        action--
                    (A) to determine whether a member of the Armed 
                Forces is a natural parent of a child; or
                    (B) to determine an obligation of a member of the 
                Armed Forces to provide child support.
            (3) Definitions.--For purposes of this subsection--
                    (A) The term ``court'' has the meaning given that 
                term in section 1408(a) of title 10, United States 
                Code.
                    (B) The term ``child support'' has the meaning 
                given such term in section 459(i) of the Social 
                Security Act (42 U.S.C. 659(i)).
    (c) Payment of Military Retired Pay in Compliance With Child 
Support Orders.--
            (1) Date of certification of court order.--Section 1408 of 
        title 10, United States Code, as amended by section 262(c)(4) 
        of this Act, is amended--
                    (A) by redesignating subsections (i) and (j) as 
                subsections (j) and (k), respectively; and
                    (B) by inserting after subsection (h) the following 
                new subsection:
    ``(i) Certification Date.--It is not necessary that the date of a 
certification of the authenticity or completeness of a copy of a court 
order for child support received by the Secretary concerned for the 
purposes of this section be recent in relation to the date of receipt 
by the Secretary.''.
            (2) Payments consistent with assignments of rights to 
        states.--Section 1408(d)(1) of such title is amended by 
        inserting after the 1st sentence the following new sentence: 
        ``In the case of a spouse or former spouse who, pursuant to 
        section 402(a)(2) of the Social Security Act (42 U.S.C. 
        602(a)(2)), assigns to a State the rights of the spouse or 
        former spouse to receive support, the Secretary concerned may 
        make the child support payments referred to in the preceding 
        sentence to that State in amounts consistent with that 
        assignment of rights.''.
            (3) Arrearages owed by members of the uniformed services.--
        Section 1408(d) of such title is amended by adding at the end 
        the following new paragraph:
            ``(6) In the case of a court order for which effective 
        service is made on the Secretary concerned on or after the date 
        of the enactment of this paragraph and which provides for 
        payments from the disposable retired pay of a member to satisfy 
        the amount of child support set forth in the order, the 
        authority provided in paragraph (1) to make payments from the 
        disposable retired pay of a member to satisfy the amount of 
        child support set forth in a court order shall apply to payment 
        of any amount of child support arrearages set forth in that 
        order as well as to amounts of child support that currently 
        become due.''.
            (4) Payroll deductions.--The Secretary of Defense shall 
        begin payroll deductions within 30 days after receiving notice 
        of withholding, or for the 1st pay period that begins after 
        such 30-day period.

SEC. 264. VOIDING OF FRAUDULENT TRANSFERS.

    Section 466 (42 U.S.C. 666), as amended by section 221 of this Act, 
is amended by adding at the end the following new subsection:
    ``(g) Laws Voiding Fraudulent Transfers.--In order to satisfy 
section 454(20)(A), each State must have in effect--
            ``(1)(A) the Uniform Fraudulent Conveyance Act of 1981;
            ``(B) the Uniform Fraudulent Transfer Act of 1984; or
            ``(C) another law, specifying indicia of fraud which create 
        a prima facie case that a debtor transferred income or property 
        to avoid payment to a child support creditor, which the 
        Secretary finds affords comparable rights to child support 
        creditors; and
            ``(2) procedures under which, in any case in which the 
        State knows of a transfer by a child support debtor with 
        respect to which such a prima facie case is established, the 
        State must--
                    ``(A) seek to void such transfer; or
                    ``(B) obtain a settlement in the best interests of 
                the child support creditor.''.

SEC. 265. WORK REQUIREMENT FOR PERSONS OWING PAST-DUE CHILD SUPPORT.

    (a) In General.--Section 466(a) of the Social Security Act (42 
U.S.C. 666(a)), as amended by sections 215, 217(a), and 223 of this 
Act, is amended by adding at the end the following new paragraph:
            ``(15) Procedures to ensure that persons owing past-due 
        support work or have a plan for payment of such support.--
                    ``(A) In general.--Procedures under which the State 
                has the authority, in any case in which an individual 
owes past-due support with respect to a child receiving assistance 
under a State program funded under part A, to seek a court order that 
requires the individual to--
                            ``(i) pay such support in accordance with a 
                        plan approved by the court, or, at the option 
                        of the State, a plan approved by the State 
                        agency administering the State program under 
                        this part; or
                            ``(ii) if the individual is subject to such 
                        a plan and is not incapacitated, participate in 
                        such work activities (as defined in section 
                        407(d)) as the court, or, at the option of the 
                        State, the State agency administering the State 
                        program under this part, deems appropriate.
                    ``(B) Past-due support defined.--For purposes of 
                subparagraph (A), the term `past-due support' means the 
                amount whose payment is overdue as determined under a 
                court order, or an order of an administrative process 
                established under State law, for support and 
                maintenance of a child, or of a child and the parent 
                with whom the child is living.''.
    (b) Conforming Amendment.--The flush paragraph at the end of 
section 466(a) (42 U.S.C.666(a)) is amended by striking ``and (7)'' and 
inserting ``(7), and (15)''.

SEC. 266. DEFINITION OF SUPPORT ORDER.

    Section 453 (42 U.S.C. 653) as amended by sections 216 and 246(b) 
of this Act, is amended by adding at the end the following new 
subsection:
    ``(p) Support Order Defined.--As used in this part, the term 
`support order' means a judgment, decree, or order, whether temporary, 
final, or subject to modification, issued by a court or an 
administrative agency of competent jurisdiction, for the support and 
maintenance of a child, including a child who has attained the age of 
majority under the law of the issuing State, or a child and the parent 
with whom the child is living, which provides for monetary support, 
health care, arrearages, or reimbursement, and which may include 
related costs and fees, interest and penalties, income withholding, 
attorneys' fees, and other relief.''.

SEC. 267. REPORTING ARREARAGES TO CREDIT BUREAUS.

    Section 466(a)(7) (42 U.S.C. 666(a)(7)) is amended to read as 
follows:
            ``(7) Reporting arrearages to credit bureaus.--
                    ``(A) In general.--Procedures (subject to 
                safeguards pursuant to subparagraph (B)) requiring the 
                State to report periodically to consumer reporting 
                agencies (as defined in section 603(f) of the Fair 
                Credit Reporting Act (15 U.S.C. 1681a(f)) the name of 
                any noncustodial parent who is delinquent in the 
                payment of support, and the amount of overdue support 
                owed by such parent.
                    ``(B) Safeguards.--Procedures ensuring that, in 
                carrying out subparagraph (A), information with respect 
                to a noncustodial parent is reported--
                            ``(i) only after such parent has been 
                        afforded all due process required under State 
                        law, including notice and a reasonable 
                        opportunity to contest the accuracy of such 
                        information; and
                            ``(ii) only to an entity that has furnished 
                        evidence satisfactory to the State that the 
                        entity is a consumer reporting agency (as so 
                        defined).''.

SEC. 268. LIENS.

    Section 466(a)(4) (42 U.S.C. 666(a)(4)) is amended to read as 
follows:
            ``(4) Liens.--Procedures under which--
                    ``(A) liens arise by operation of law against real 
                and personal property for amounts of overdue support 
                owed by a noncustodial parent who resides or owns 
                property in the State; and
                    ``(B) the State accords full faith and credit to 
                liens described in subparagraph (A) arising in another 
                State, without registration of the underlying order.''.

SEC. 269. STATE LAW AUTHORIZING SUSPENSION OF LICENSES.

    Section 466(a) (42 U.S.C. 666(a)), as amended by sections 215, 
217(a), 223, and 265 of this Act, is amended by adding at the end the 
following:
            ``(16) Authority to withhold or suspend licenses.--
        Procedures under which the State has (and uses in appropriate 
        cases) authority to withhold or suspend, or to restrict the use 
        of, driver's licenses, professional and occupational licenses, 
        and recreational licenses of individuals owing overdue support 
        or failing, after receiving appropriate notice, to comply with 
        subpoenas or warrants relating to paternity or child support 
        proceedings.''.

SEC. 270. DENIAL OF PASSPORTS FOR NONPAYMENT OF CHILD SUPPORT.

    (a) HHS Certification Procedure.--
            (1) Secretarial responsibility.--Section 452 (42 U.S.C. 
        652), as amended by section 246 of this Act, is amended by 
        adding at the end the following new subsection:
    ``(k)(1) If the Secretary receives a certification by a State 
agency in accordance with the requirements of section 454(31) that an 
individual owes arrearages of child support in an amount exceeding 
$5,000, the Secretary shall transmit such certification to the 
Secretary of State for action (with respect to denial, revocation, or 
limitation of passports) pursuant to section 270(b) of the Work First 
and Personal Responsibility Act of 1996.
            ``(2) The Secretary shall not be liable to an individual 
        for any action with respect to a certification by a State 
        agency under this section.''.
            (2) State agency responsibility.--Section 454 (42 U.S.C. 
        654), as amended by sections 201(b), 203(a), 212(b), 213(a), 
        233, and 244(b) of this Act, is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (29);
                    (B) by striking the period at the end of paragraph 
                (30) and inserting ``; and''; and
                    (C) by adding after paragraph (30) the following 
                new paragraph:
            ``(31) provide that the State agency will have in effect a 
        procedure for certifying to the Secretary, for purposes of the 
        procedure under section 452(k), determinations that individuals 
        owe arrearages of child support in an amount exceeding $5,000, 
        under which procedure--
                    ``(A) each individual concerned is afforded notice 
                of such determination and the consequences thereof, and 
                an opportunity to contest the determination; and
                    ``(B) the certification by the State agency is 
                furnished to the Secretary in such format, and 
                accompanied by such supporting documentation, as the 
                Secretary may require.''.
    (b) State Department Procedure for Denial of Passports.--
            (1) In general.--The Secretary of State shall, upon 
        certification by the Secretary of Health and Human Services 
        transmitted under section 452(k) of the Social Security Act, 
        refuse to issue a passport to such individual, and may revoke, 
        restrict, or limit a passport issued previously to such 
        individual.
            (2) Limit on liability.--The Secretary of State shall not 
        be liable to an individual for any action with respect to a 
        certification by a State agency under this section.
    (c) Effective Date.--This section and the amendments made by this 
section become effective October 1, 1996.

SEC. 271. INTERNATIONAL CHILD SUPPORT ENFORCEMENT.

    (a) Authority for International Agreements.--Part D of title IV, as 
amended by section 262(a) of this Act, is amended by adding after 
section 459 the following new section:

``SEC. 459A. INTERNATIONAL CHILD SUPPORT ENFORCEMENT.

    ``(a) Authority for Declarations.--
            ``(1) Declaration.--The Secretary of State, with the 
        concurrence of the Secretary of Health and Human Services, is 
        authorized to declare any foreign country (or a political 
        subdivision thereof) to be a foreign reciprocating country if 
        the foreign country has established, or undertakes to 
        establish, procedures for the establishment and enforcement of 
        duties of support owed to obligees who are residents of the 
        United States, and such procedures are substantially in 
        conformity with the standards prescribed under subsection (b).
            ``(2) Revocation.--A declaration with respect to a foreign 
        country made pursuant to paragraph (1) may be revoked if the 
        Secretaries of State and Health and Human Services determine 
        that--
                    ``(A) the procedures established by the foreign 
                nation regarding the establishment and enforcement of 
                duties of support have been so changed, or the foreign 
                nation's implementation of such procedures is so 
                unsatisfactory, that such procedures do not meet the 
                criteria for such a declaration; or
                    ``(B) continued operation of the declaration is not 
                consistent with the purposes of this part.
            ``(3) Form of declaration.--A declaration under paragraph 
        (1) may be made in the form of an international agreement, in 
        connection with an international agreement or corresponding 
        foreign declaration, or on a unilateral basis.
    ``(b) Standards for Foreign Support Enforcement Procedures.--
            ``(1) Mandatory elements.--Child support enforcement 
        procedures of a foreign country which may be the subject of a 
        declaration pursuant to subsection (a)(1) shall include the 
        following elements:
                    ``(A) The foreign country (or political subdivision 
                thereof) has in effect procedures, available to 
                residents of the United States--
                            ``(i) for establishment of paternity, and 
                        for establishment of orders of support for 
                        children and custodial parents; and
                            ``(ii) for enforcement of orders to provide 
                        support to children and custodial parents, 
                        including procedures for collection and 
                        appropriate distribution of support payments 
                        under such orders.
                    ``(B) The procedures described in subparagraph (A), 
                including legal and administrative assistance, are 
                provided to residents of the United States at no cost.
                    ``(C) An agency of the foreign country is 
                designated as a Central Authority responsible for--
                            ``(i) facilitating child support 
                        enforcement in cases involving residents of the 
                        foreign nation and residents of the United 
                        States; and
                            ``(ii) ensuring compliance with the 
                        standards established pursuant to this 
                        subsection.
            ``(2) Additional Elements.--The Secretary of Health and 
        Human Services and the Secretary of State, in consultation with 
        the States, may establish such additional standards as may be 
        considered necessary to further the purposes of this section.
    ``(c) Designation of United States Central Authority.--It shall be 
the responsibility of the Secretary of Health and Human Services to 
facilitate child support enforcement in cases involving residents of 
the United States and residents of foreign nations that are the subject 
of a declaration under this section, by activities including--
            ``(1) development of uniform forms and procedures for use 
        in such cases;
            ``(2) notification of foreign reciprocating countries of 
        the State of residence of individuals sought for support 
        enforcement purposes, on the basis of information provided by 
        the Federal Parent Locator Service; and
            ``(3) such other oversight, assistance, and coordination 
        activities as the Secretary may find necessary and appropriate.
    ``(d) Effect on Other Laws.--States may enter into reciprocal 
arrangements for the establishment and enforcement of child support 
obligations with foreign countries that are not the subject of a 
declaration pursuant to subsection (a), to the extent consistent with 
Federal law.''.
    (b) State Plan Requirement.--Section 454 (42 U.S.C. 654), as 
amended by sections 201(b), 203(a), 212(b), 213(a), 233, 244(b), and 
270(a)(2) of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (30);
            (2) by striking the period at the end of paragraph (31) and 
        inserting ``; and''; and
            (3) by adding after paragraph (31) the following new 
        paragraph:
            ``(32)(A) provide that any request for services under this 
        part by a foreign reciprocating country or a foreign country 
        with which the State has an arrangement described in section 
        459A(d)(2) shall be treated as a request by a State;
                    ``(B) provide, at State option, notwithstanding 
                paragraph (4) or any other provision of this part, for 
                services under the plan for enforcement of a spousal 
                support order not described in paragraph (4)(B) entered 
                by such a country (or subdivision); and
                    ``(C) provide that no applications will be required 
                from, and no costs will be assessed for such services 
                against, the foreign reciprocating country or foreign 
                obligee (but costs may at State option be assessed 
                against the obligor).''.

SEC. 272. FINANCIAL INSTITUTION DATA MATCHES.

    Section 466(a) (42 U.S.C. 666(a)), as amended by sections 215, 
217(a), 223, 265, and 269 of this Act, is amended by adding at the end 
the following new paragraph:
            ``(17) Financial institution data matches.--
                    ``(A) In general.--Procedures under which the State 
                agency shall enter into agreements with financial 
                institutions doing business in the State--
                            ``(i) to develop and operate, in 
                        coordination with such financial institutions, 
                        a data match system, using automated data 
                        exchanges to the maximum extent feasible, in 
                        which each such financial institution is 
                        required to provide for each calendar quarter 
                        the name, record address, social security 
                        number or other taxpayer identification number, 
                        and other identifying information for each 
                        noncustodial parent who maintains an account at 
                        such institution and who owes past-due support, 
                        as identified by the State by name and social 
                        security number or other taxpayer 
                        identification number; and
                            ``(ii) in response to a notice of lien or 
                        levy, encumber or surrender, as the case may 
                        be, assets held by such institution on behalf 
                        of any noncustodial parent who is subject to a 
                        child support lien pursuant to paragraph (4).
                    ``(B) Reasonable fees.--The State agency may pay a 
                reasonable fee to a financial institution for 
                conducting the data match provided for in subparagraph 
                (A)(i), not to exceed the actual costs incurred by such 
                financial institution.
                    ``(C) Liability.--A financial institution shall not 
                be liable under any Federal or State law to any 
                person--
                            ``(i) for any disclosure of information to 
                        the State agency under subparagraph (A)(i);
                            ``(ii) for encumbering or surrendering any 
                        assets held by such financial institution in 
                        response to a notice of lien or levy issued by 
                        the State agency as provided for in 
                        subparagraph (A)(ii); or
                            ``(iii) for any other action taken in good 
                        faith to comply with the requirements of 
                        subparagraph (A).
                    ``(D) Definitions.--For purposes of this 
                paragraph--
                            ``(i) Financial institution.--The term 
                        `financial institution' means any Federal or 
                        State commercial savings bank, including 
                        savings association or cooperative bank, 
                        Federal- or State-chartered credit union, 
                        benefit association, insurance company, safe 
                        deposit company, money-market mutual fund, or 
                        any similar entity authorized to do business in 
                        the State; and
                            ``(ii) Account.--The term `account' means a 
                        demand deposit account, checking or negotiable 
                        withdrawal order account, savings account, time 
                        deposit account, or money-market mutual fund 
                        account.''.

SEC. 273. ENFORCEMENT OF ORDERS AGAINST PATERNAL OR MATERNAL 
              GRANDPARENTS IN CASES OF MINOR PARENTS.

    Section 466(a) (42 U.S.C. 666(a)), as amended by sections 215, 
217(a), 223, 265, 269, and 272 of this Act, is amended by adding at the 
end the following new paragraph:
            ``(18) Enforcement of orders against paternal or maternal 
        grandparents.--Procedures under which, at the State's option, 
        any child support order enforced under this part with respect 
        to a child of minor parents, if the custodial parents of such 
        child is receiving assistance under the State program under 
        part A, shall be enforceable, jointly and severally, against 
        the parents of the noncustodial parents of such child.''.

SEC. 274. NONDISCHARGEABILITY IN BANKRUPTCY OF CERTAIN DEBTS FOR THE 
              SUPPORT OF A CHILD.

    (a) Amendment to Title 11 of the United States Code.--Section 
523(a) of title 11, United States Code, is amended--
            (1) in paragraph (16) by striking the period at the end and 
        inserting ``; or'',
            (2) by adding at the end the following:
            ``(17) to a State or municipality for assistance provided 
        by such State or municipality under a State program funded 
        under part A of title IV of the Social Security Act to the 
        extent that such assistance is provided for the support of a 
        child of the debtor.'', and
            (3) in paragraph (5), by striking ``(26)'' and inserting 
        ``(2)''.
    (b) Amendment to the Social Security Act.--Section 456(b) of the 
Social Security Act (42 U.S.C. 656(b)) is amended to read as follows:
    ``(b) Nondischargeability.--A debt (as defined in section 101 of 
title 11 of the United States Code) to a State (as defined in such 
section) or municipality (as defined in such section) for assistance 
provided by such State or municipality under a State program funded 
under part A of title IV is not dischargeable under section 727, 1141, 
1228(a), 1228(b), or 1328(b) of title 11 of the United States Code to 
the extent that such assistance is provided for the support of a child 
of the debtor (as defined in such section).''.
    (c) Application of Amendments.--The amendments made by this section 
apply only with respect to cases commenced under title 11 of the United 
States Code after the effective date of this section.

                      Subtitle H--Medical Support

SEC. 276. CORRECTION TO ERISA DEFINITION OF MEDICAL CHILD SUPPORT 
              ORDER.

    (a) In General.--Section 609(a)(2)(B) of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1169(a)(2)(B)) is amended--
            (1) by striking ``issued by a court of competent 
        jurisdiction'';
            (2) by striking the period at the end of clause (ii) and 
        inserting a comma; and
            (3) by adding, after and below clause (ii), the following: 
        ``if such judgment, decree, or order (I) is issued by a court 
        of competent jurisdiction or (II) is issued through an 
        administrative process established under State law and has the 
        force and effect of law under applicable State law.''.
    (b) Effective Date.--
            (1) In general.--The amendments made by this section take 
        effect on the date of the enactment of this Act.
            (2) Plan amendments not required until july 1, 1996.--Any 
        amendment to a plan required to be made by an amendment made by 
        this section shall not be required to be made before the first 
        plan year beginning on or after July 1, 1996, if--
                    (A) during the period following the day before the 
                date of enactment of this Act and before the first plan 
                year, the plan is operated in accordance with the 
                requirements of the amendments made by this section; 
                and
                    (B) the plan amendment applies retroactively to the 
                period specified in subparagraph (A).
A plan shall not be treated as failing to be operated in accordance 
with the provisions of the plan merely because it operates in 
accordance with this paragraph.

SEC. 277. ENFORCEMENT OF ORDERS FOR HEALTH CARE COVERAGE.

    Section 466(a) (42 U.S.C. 666(a)), as amended by sections 215, 
217(a), 223, 265, 269, 272, and 273 of this Act, is amended by adding 
at the end the following new paragraph:
            ``(19) Health care coverage.--Procedures under which all 
        child support orders established or modified pursuant to this 
        part shall include a provision for the health care coverage of 
        the child, and in the case in which a noncustodial parent 
        provides such coverage and changes employment, and the new 
        employer provides health care coverage, the State agency shall 
        transfer notice of the provision to the employer, which notice 
        shall operate to enroll the child in the noncustodial parent's 
        health plan, unless the noncustodial parent contests the 
        notice.''.

     Subtitle I--Enhancing Responsibility and Opportunity for Non-
                          Residential Parents

SEC. 281. GRANTS TO STATES FOR ACCESS AND VISITATION PROGRAMS.

    Part D of title IV (42 U.S.C. 651-669) is amended by adding at the 
end the following:

``SEC. 469A. GRANTS TO STATES FOR ACCESS AND VISITATION PROGRAMS.

    ``(a) In General.--The Secretary shall make grants under this 
section to enable States to establish and administer programs to 
support and facilitate noncustodial parents' access to and visitation 
of their children, by means of activities including mediation (both 
voluntary and mandatory), counseling, education, development of 
parenting plans, visitation enforcement (including monitoring, 
supervision and neutral drop-off and pickup), and development of 
guidelines for visitation and alternative custody arrangements.
    ``(b) Amount of Grant.--The amount of the grant to be made to a 
State under this section for a fiscal year shall be an amount equal to 
the lesser of--
            ``(1) 90 percent of State expenditures during the fiscal 
        year for activities described in subsection (a); or
            ``(2) the allotment of the State under subsection (c) for 
        the fiscal year.
    ``(c) Allotments to States.--
            ``(1) In General.--The allotment of a State for a fiscal 
        year is the amount that bears the same ratio to the amount 
        appropriated for grants under this section for the fiscal year 
        as the number of children in the State living with only 1 
        biological parent bears to the total number of such children in 
        all States.
            ``(2) Minimum Allotment.--The Administration for Children 
        and Families shall adjust allotments to States under paragraph 
(1) as necessary to ensure that no State is allotted less than--
                    ``(A) $50,000 for fiscal year 1996 or 1997; or
                    ``(B) $100,000 for any succeeding fiscal year.
    ``(d) No Supplantation of State Expenditures for Similar 
Activities.--A State to which a grant is made under this section may 
not use the grant to supplant expenditures by the State for activities 
specified in subsection (a), but shall use the grant to supplement such 
expenditures at a level at least equal to the level of such 
expenditures for fiscal year 1995.
    ``(e) State Administration.--Each State to which a grant is made 
under this section--
            ``(1) may administer State programs funded with the grant, 
        directly or through grants to or contracts with courts, local 
        public agencies, or non-profit private entities;
            ``(2) shall not be required to operate such programs on a 
        statewide basis; and
            ``(3) shall monitor, evaluate, and report on such programs 
        in accordance with regulations prescribed by the Secretary.''.

                    Subtitle J--Effect of Enactment

SEC. 291. EFFECTIVE DATES.

    (a) In General.--Except as otherwise specifically provided (but 
subject to subsections (b) and (c))--
            (1) the provisions of this title requiring the enactment or 
        amendment of State laws under section 466 of the Social 
        Security Act, or revision of State plans under section 454 of 
        such Act, are effective with respect to periods beginning on 
        and after October 1, 1996; and
            (2) all other provisions of this title are effective upon 
        the date of the enactment of this Act.
    (b) Grace Period for State Law Changes.--The provisions of this 
title shall become effective with respect to a State on the later of--
            (1) the date specified in this title, or
            (2) the effective date of laws enacted by the legislature 
        of such State implementing such provisions,
but in no event later than the 1st day of the 1st calendar quarter 
beginning after the close of the 1st regular session of the State 
legislature that begins after the date of the enactment of this Act. 
For purposes of the previous sentence, in the case of a State that has 
a 2-year legislative session, each year of such session shall be deemed 
to be a separate regular session of the State legislature.
    (c) Grace Period for State Constitutional Amendment.--A State shall 
not be found out of compliance with any requirement enacted by this 
title if the State is unable to so comply without amending the State 
constitution until the earlier of--
            (1) 1 year after the effective date of the necessary State 
        constitutional amendment; or
            (2) 5 years after the date of the enactment of this Act.

                       TITLE III--FOOD ASSISTANCE

                        Subtitle A--Food Stamps

SEC. 301. SHORT TITLE.

This subtitle may be cited as ``The Food Stamp Act Amendments of 
1996''.

                      PART 1--BUDGETARY PROPOSALS

SEC. 311. INCLUDE CHILDREN UNDER 22 YEARS OLD IN THEIR PARENTS' 
              HOUSEHOLDS.

    Section 3(i) of the Food Stamp Act of 1977 (7 U.S.C. 2012(i)) is 
amended by striking the first parenthetical phrase in the second 
sentence.

SEC. 312. USE THE COST OF THE THRIFTY FOOD PLAN FOR ALLOTMENT 
              ADJUSTMENTS.

    Section 3(o) of the Food Stamp Act of 1977 (7 U.S.C. 2012(o)) is 
amended--
            (1) in clause (11), by inserting ``until October 1, 1996,'' 
        after ``thereafter,''; and
            (2) by adding a new third sentence at the end as follows: 
        ``On October 1, 1996, and each October 1 thereafter, adjust the 
        cost of such diet to reflect the cost of the thrifty food plan 
        in the preceding June, and round the result to the nearest 
        lower dollar increment for each household size.''.

SEC. 313. LOWER AGE FOR EXCLUDING STUDENTS' EARNINGS.

    Section 5(d)(7) of the Food Stamp Act of 1977 (7 U.S.C. 2014(d)(7)) 
is amended by striking ``is 21 years of age or younger'' and inserting 
``has not reached the age of 18''.

SEC. 314. COUNT GOVERNMENTAL ENERGY ASSISTANCE AS INCOME.

    (a) Section 5(d)(11) of the Food Stamp Act of 1977 (7 U.S.C. 
2014(d)) is amended to read as follows--
            ``(11) a 1-time payment or allowance made under a Federal 
        or State law for the costs of weatherization or emergency 
        repair or replacement of an unsafe or inoperative furnace or 
        other heating or cooling device,''.
    (b) Section 5(e) of the Food Stamp Act of 1977 (7 U.S.C. 2014(e)) 
is amended by striking ``If a State agency elects'' and all that 
follows through ``season for which it was provided.''.
    (c) Section 5(k) of the Food Stamp Act of 1977 (7 U.S.C. 2014(k)) 
is amended by--
            (1) striking, in paragraph (1)(B), ``, not including energy 
        or utility-cost assistance,'';
            (2) striking paragraph (2)(C); and
            (3) adding at the end the following--
            ``(4)(A) For purposes of subsection (d)(1), a payment made 
        under a Federal or State law to provide energy assistance to a 
        household shall be considered money payable directly to the 
        household.
                    ``(B) For purposes of subsection (e), an expense 
                paid on behalf of a household under a Federal or State 
                law to provide energy assistance shall be considered an 
                out-of-pocket expense incurred and paid by the 
                household.''.
    (d) Section 2605(f) of the Low-Income Home Energy Assistance Act of 
1981 (42 U.S.C. 8624(f)) is amended by--
            (1) striking ``(1) Notwithstanding any other provision of 
        law unless'' and inserting ``Notwithstanding any other 
        provision of law except the Food Stamp Act of 1977 (7 U.S.C. 
        2011 et seq.), and any'';
            (2) striking, in paragraph (1), ``food stamps,''; and
            (3) striking paragraph (2).

SEC. 315. REDUCE THE STANDARD DEDUCTION.

    Section 5(e) of the Food Stamp Act of 1977 (7 U.S.C. 2014(e)) is 
amended by striking the first two sentences and inserting--``The 
Secretary shall allow a standard deduction for each household in the 48 
contiguous States and the District of Columbia, Alaska, Hawaii, Guam, 
and the Virgin Islands of the United States of--
            ``(i) for fiscal year 1996, $130, $222, $183, $260, and 
        $114, respectively;
            ``(ii) for fiscal years 1997 through 2000, $122, $208, 
        $171, $244, and $106, respectively; and
            ``(iii) on October 1, 2000, and each October 1 thereafter, 
        the Secretary shall adjust the standard deduction to the 
        nearest lower dollar increment to reflect changes in the 
        Consumer Price Index for all urban consumers published by the 
        Bureau of Labor Statistics, for items other than food, for the 
        12-month period ending the preceding June 30.''.

SEC. 316. PROVIDE A STATE OPTION TO MANDATE USE OF STANDARD UTILITY 
              ALLOWANCES.

    Section 5(e) of the Food Stamp Act of 1977 (7 U.S.C. 2014(e)) is 
amended by inserting before ``No such allowance may be used'' the 
following new sentence: ``A State agency may make the use of a standard 
utility allowance mandatory for all households with qualifying utility 
costs if (1) the State agency has developed one or more standards that 
include the cost of heating and cooling and one or more standards that 
do not include the cost of heating and cooling; and (2) the Secretary 
finds that the standards will not result in increased program costs.''.

SEC. 317. REVISE INDEXATION OF VEHICLE ASSET LIMITATION.

    The first sentence of section 5(g)(2) of the Food Stamp Act of 1977 
(7 U.S.C. 2014(g)(2)) is amended by striking ``through September 30, 
1996'' and all that follows through ``such date and on'' and inserting 
``and shall be adjusted on October 1, 1996, and''.

SEC. 318. COUNT VENDOR PAYMENTS FOR TRANSITIONAL HOUSING AS INCOME.

    Section 5(k)(2) of the Food Stamp Act of 1977 (7 U.S.C. 2014(k)(2)) 
is amended by--
            (1) striking subparagraph (F); and
            (2) redesignating subparagraphs (G) and (H) as 
        subparagraphs (F) and (G), respectively.

SEC. 319. STRENGTHEN PENALTIES FOR NONCOMPLIANCE WITH WORK 
              REQUIREMENTS.

    (a) Section 6(d) of the Food Stamp Act of 1977 (7 U.S.C. 2015(d)) 
is amended by striking ``(d)(1) Unless otherwise exempted by the 
provisions'' and all that follows through the end of paragraph (1) and 
inserting the following--
    ``(d)(1)(A) No physically and mentally fit individual over the age 
of 15 and under the age of 60 shall be eligible to participate in the 
food stamp program if the individual--
            ``(i) refuses, at the time of application and every 12 
        months thereafter, to register for employment in a manner 
        prescribed by the Secretary;
            ``(ii) refuses without good cause to participate in an 
        employment and training program under paragraph (4), to the 
        extent required by the State agency;
            ``(iii) refuses without good cause to accept an offer of 
        employment, at a site or plant not subject to a strike or 
        lockout at the time of the refusal, at a wage not less than the 
        higher of--
                    ``(I) the applicable Federal or State minimum wage; 
                or
                    ``(II) 80 percent of the wage that would have 
                governed had the minimum hourly rate under section 
                6(a)(1) of the Fair Labor Standards Act of 1938 (29 
                U.S.C. 206(a)(1)) been applicable to the offer of 
                employment;
            ``(iv) refuses without good cause to provide a State agency 
        with sufficient information to allow the State agency to 
        determine the employment status or the job availability of the 
        individual;
            ``(v) voluntarily and without good cause--
                    ``(I) quits a job; or
                    ``(II) reduces work effort and, after the 
                reduction, the individual is working less than 30 hours 
                per week; or
            ``(vi) fails to comply with section 20.
    ``(B) If an individual who is the head of a household becomes 
ineligible to participate in the food stamp program under subparagraph 
(A), the household shall, at the option of the State agency, become 
ineligible to participate in the food stamp program for a period, 
determined by the State agency, that does not exceed the lesser of--
            ``(i) the duration of the ineligibility of the individual 
        determined under subparagraph (C); or
            ``(ii) 180 days.
    ``(C)(i) The first time that an individual becomes ineligible to 
participate in the food stamp program under subparagraph (A), the 
individual shall remain ineligible until the later of--
            ``(I) the date the individual becomes eligible under 
        subparagraph (A);
            ``(II) the date that is 1 month after the date the 
        individual became ineligible; or
            ``(III) a date determined by the State agency that is not 
        later than 3 months after the date the individual became 
        ineligible.
    ``(ii) The second time that an individual becomes ineligible to 
participate in the food stamp program under subparagraph (A), the 
individual shall remain ineligible until the later of--
            ``(I) the date the individual becomes eligible under 
        subparagraph (A);
            ``(II) the date that is 3 months after the date the 
        individual became ineligible; or
            ``(III) a date determined by the State agency that is not 
        later than 6 months after the date the individual became 
        ineligible.
    ``(iii) The third or subsequent time that an individual becomes 
ineligible to participate in the food stamp program under subparagraph 
(A), the individual shall remain ineligible until the later of--
            ``(I) the date the individual becomes eligible under 
        subparagraph (A);
            ``(II) the date that is 6 months after the date the 
        individual became ineligible;
            ``(III) a date determined by the State agency; or
            ``(IV) at the option of the State agency, permanently.
    ``(D)(i) The Secretary shall determine the meaning of `good cause' 
for the purpose of this paragraph.
    ``(ii) The Secretary shall determine the meaning of `voluntarily 
quitting' and `reduces work effort' for the purpose of this paragraph.
    ``(iii)(I) Subject to subclause (II) and clauses (i) and (ii), a 
State agency shall determine--
            ``(aa) the meaning of any term in subparagraph (A);
            ``(bb) the procedures for determining whether an individual 
        is in compliance with a requirement under subparagraph (A); and
            ``(cc) whether an individual is in compliance with a 
        requirement under subparagraph (A).
    ``(II) A State agency may not determine a meaning, procedure, or 
determination under subclause (I) to be less restrictive than a 
comparable meaning, procedure, or determination under a State program 
funded under part A of title IV of the Social Security Act (42 U.S.C. 
601 et seq.).
    ``(iv) For the purpose of subparagraph (A)(v), an employee of the 
Federal Government, a State, or a political subdivision of a State, who 
is dismissed for participating in a strike against the Federal 
Government, the State, or the political subdivision of the State shall 
be considered to have voluntarily quit without good cause.
    ``(v)(I) For the purpose of this paragraph, the State agency shall 
allow the household to select any adult parent of a child in the 
household as the head of the household if all adult household members 
making application under the food stamp program agree to the selection.
    ``(II) A household may designate the head of the household under 
subclause (I) each time the household is certified for participation in 
the food stamp program, but may not change the designation during a 
certification period unless there is a change in the composition of the 
household.
    ``(vi) If the head of a household leaves the household during a 
period in which the household is ineligible to participate in the food 
stamp program under subparagraph (B)--
            ``(I) the household shall, if otherwise eligible, become 
        eligible to participate in the food stamp program; and
            ``(II) if the head of the household becomes the head of 
        another household, the household that becomes headed by the 
        individual shall become ineligible to participate in the food 
        stamp program for the remaining period of ineligibility.''.
    (b)(1) The second sentence of section 17(b)(2) of the Food Stamp 
Act of 1977 (7 U.S.C. 2026(b)(2)) is amended by striking ``6(d)(1)(i)'' 
and inserting ``6(d)(1)(A)(i)''.
    (2) Section 20 of the Food Stamp Act of 1977 (7 U.S.C. 2029) is 
amended by striking subsection (f) and inserting the following--
    ``(f) An individual or a household may become ineligible under 
section 6(d)(1) to participate in the food stamp program for failing to 
comply with this section.''.

 SEC. 320. PROVIDE A STATE OPTION TO REQUIRE COOPERATION WITH CHILD 
              SUPPORT ENFORCEMENT AGENCIES.

    (a) Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015) is 
amended by adding new subsections (i) and (j) at the end as follows:
    ``(i) At the option of the State, no natural or adoptive parent or 
other individual who is living with and exercising parental control 
over a child under the age of eighteen who has an absent parent shall 
be eligible to participate in the food stamp program unless the natural 
or adoptive parent or individual cooperates with the State agency 
administering the program under part D of title IV of the Social 
Security Act (or is determined by such State agency to have good cause 
not to cooperate) in (1) establishing the paternity of such child (if 
born out of wedlock), and (2) obtaining support for such child or for 
the parent or individual and for such child. Notwithstanding any 
provision of part D of title IV of the Social Security Act, no person 
required under this subsection to cooperate with the State agency 
administering the program under part D of title IV of the Social 
Security Act may be required to pay a fee or other costs for services 
provided under such program.
    ``(j)(1) At the option of a State agency, subject to paragraphs (2) 
and (3), a putative or identified non-custodial parent of a child under 
the age of 18 (referred to in this subsection as `the individual') 
shall not be eligible to participate in the food stamp program if the 
individual refuses to cooperate with the State agency administering the 
program established under part D of title IV of the Social Security Act 
(42 U.S.C. 651 et seq.)--
            ``(A) in establishing the paternity of the child (if the 
        child is born out of wedlock); and
            ``(B) in providing support for the child.
    ``(2)(A) The Secretary, in consultation with the Secretary of 
Health and Human Services, shall develop guidelines on what constitutes 
a refusal to cooperate under paragraph (1).
    ``(B) The State agency shall develop procedures, using guidelines 
developed under subparagraph (A), for determining whether an individual 
is refusing to cooperate under paragraph (1).
    ``(3) Paragraph (1) shall not require the payment of a fee or other 
cost for services provided under part D of title IV of the Social 
Security Act (42 U.S.C. 651 et seq.).
    ``(4) The State agency shall have in effect, with respect to 
information collected by the State agency administering the program 
established under part D of title IV of the Social Security Act (42 
U.S.C. 651 et seq.)--
            ``(A) procedures for obtaining such information which are 
        compatible with procedures established under and consistent 
        with the requirements of that part; and
            ``(B) safeguards on the maintenance, disclosure, and use of 
        such information which comply with standards and requirements 
        of that part with respect to such safeguards.''.

 SEC. 321. PROVIDE FOR DISQUALIFICATION FOR RECEIPT OF MULTIPLE FOOD 
              STAMP BENEFITS.

    Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as amended 
by this Act, is further amended by adding at the end the following new 
subsection--
    ``(k) An individual shall be ineligible to participate in the food 
stamp program as a member of any household for a 10-year period if the 
individual is found by a State agency to have made, or is convicted in 
Federal or State court of having made, a fraudulent statement or 
representation with respect to the identity or place of residence of 
the individual in order to receive multiple benefits simultaneously 
under the food stamp program.''.

 SEC. 322. ESTABLISH ADDITIONAL WORK REQUIREMENT.

    (a) Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as 
amended by this Act, is further amended by adding at the end the 
following new subsection--
    ``(l)(1) In this subsection, the term `work program' means--
            ``(A) a program under the Job Training Partnership Act (29 
        U.S.C. 1501 et seq.);
            ``(B) a program under section 236 of the Trade Act of 1974 
        (19 U.S.C. 2296); or
            ``(C) a program of employment or training operated or 
        supervised by a State or local government which meets standards 
        deemed appropriate by the Governor, including a program under 
        section 6(d)(4).
    ``(2) An individual is not eligible to participate in the food 
stamp program as a member of any household if, during the preceding 12 
months, the individual received food stamp benefits for not less than 6 
months during which the individual did not--
            ``(A) work 20 hours or more per week, averaged monthly;
            ``(B) participate in a workfare program under section 20 or 
        a comparable State or local workfare program;
            ``(C) participate in and comply with the requirements of an 
        approved employment and training program under subsection 
        (d)(4); or
            ``(D) participate in and comply with the requirements of a 
        work program for 20 hours or more per week.
    ``(3) Paragraph (2) shall not apply to an individual if the 
individual is--
            ``(A) under 18 or over 50 years of age;
            ``(B) medically certified as physically or mentally unfit 
        for employment;
            ``(C) a parent or other member of a household with a 
        dependent child under 18 years of age;
            ``(D) a pregnant woman;
            ``(E) unable to participate in an employment and training 
        program because the State in which the individual resides does 
        not provide sufficient opportunities for participation in such 
        programs; or
            ``(F) otherwise exempt under section 6(d)(2).
    ``(4)(A) The Secretary may waive the applicability of paragraph (2) 
to any group of individuals in the State if the Secretary makes a 
determination that the area in which the individuals reside--
            ``(i) has an unemployment rate of over 7 percent; or
            ``(ii) does not have a sufficient number of jobs to provide 
        employment for the individuals.
    ``(B) The Secretary shall report the basis for a waiver under 
subparagraph (A) to the Committee on Agriculture of the House of 
Representatives and the Committee on Agriculture, Nutrition, and 
Forestry of the Senate.''.
    (b) Section 16(h) of the Food Stamp Act of 1977 (7 U.S.C. 2025(h)) 
is amended by striking paragraph (1) and inserting the following--
            ``(1)(A) To carry out employment and training programs, the 
        Secretary shall reserve for allocation to State agencies from 
        funds made available for each fiscal year under section 
        18(a)(1) the amount of--
                    ``(i) for fiscal year 1996, $75,000,000;
                    ``(ii) for fiscal year 1997, $80,000,000;
                    ``(iii) for fiscal year 1998, $90,000,000;
                    ``(iv) for fiscal year 1999, $95,000,000;
                    ``(v) for fiscal year 2000, $95,000,000;
                    ``(vi) for fiscal year 2001, $95,000,000; and
                    ``(vii) for fiscal year 2002, $95,000,000.
            ``(B) A State agency shall not reduce non-Federal 
        expenditures to carry out employment and training programs 
        during any fiscal year after fiscal year 1995 from the level of 
        State agency expenditures to carry out employment and training 
        programs in fiscal year 1995.
            ``(C) The Secretary shall allocate the amounts reserved 
        under subparagraph (A) among the State agencies using a 
        reasonable formula (as determined by the Secretary) that 
        considers the population in each State affected by section 
        6(d)(4)(O).
            ``(D)(i) A State agency promptly shall notify the Secretary 
        if the State agency determines that the State agency will not 
        expend all of the funds allocated to the State agency under 
        subparagraph (C).
            ``(ii) On notification under clause (i), the Secretary 
        shall reallocate the funds that the State agency will not 
        expend as the Secretary considers appropriate and equitable.
            ``(E) Notwithstanding subparagraphs (A) through (D), the 
        Secretary shall ensure that each State agency operating an 
        employment and training program shall receive not less than 
        $50,000 in each fiscal year.''.
    (c) Section 16(h)(2) of the Food Stamp Act of 1977 (7 U.S.C. 
2025(h)(2)) is amended by inserting before the period at the end the 
following--
    ``, including the costs for case management and casework to 
facilitate the transition from economic dependency to self-sufficiency 
through work''.

SEC. 323. ESTABLISH COMPARABLE TREATMENT FOR DISQUALIFICATION.

    (a) Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as 
amended by this Act, is further amended by adding at the end the 
following new subsection--
    ``(m)(1) If a disqualification is imposed on a member of a 
household for a failure of the member to perform an action required 
under a Federal, State, or local law relating to a means tested public 
assistance program, the State agency may impose the same 
disqualification on the member of the household under the food stamp 
program.
    ``(2) If a disqualification is imposed under paragraph (1) for a 
failure of an individual to perform an action required under part A of 
title IV of the Social Security Act (42 U.S.C. 601 et seq.), the State 
agency may use the rules and procedures that apply under part A of 
title IV of the Social Security Act (42 U.S.C. 601 et seq.) to impose 
the same disqualification under the food stamp program.
    ``(3) A member of a household disqualified under paragraph (1) may, 
after the disqualification period has expired, apply for benefits under 
this Act and shall be treated as a new applicant, except that a prior 
disqualification under subsection (d) shall be considered in 
determining eligibility.''.
    (b) Section 11(e) of the Food Stamp Act of 1977 (7 U.S.C. 2020(e)) 
is amended--
            (1) in paragraph (24), by striking ``and'' at the end;
            (2) in paragraph (25), by striking the period at the end 
        and inserting a semicolon; and
            (3) by adding at the end the following--
            ``(26) the guidelines the State agency uses in carrying out 
        section 6(m); and''.
    (c) Section 6(d)(2)(A) of the Food Stamp Act of 1977 (7 U.S.C. 
2015(d)(2)(A)) is amended by striking ``that is comparable to a 
requirement of paragraph (1)''.

SEC. 324. REPEAL MINIMUM BENEFIT ADJUSTMENTS.

    Section 8(a) of the Food Stamp Act of 1977 (7 U.S.C. 2017(a)) is 
amended by striking in the proviso ``, and shall be adjusted'' and all 
that follows through ``$5''.

SEC. 325. PRORATE BENEFITS ON RECERTIFICATION.

    Section 8(c)(2)(B) of the Food Stamp Act of 1977 (7 U.S.C. 
2017(c)(2)(B)) is amended by striking ``of more than one month''.

SEC. 326. PROHIBIT ALLOTMENT INCREASES FOR PENALTIES UNDER OTHER 
              WELFARE AND PUBLIC ASSISTANCE PROGRAMS.

    Section 8 of the Food Stamp Act of 1977 (7 U.S.C. 2017) is amended 
by striking subsection (d) and inserting the following--
    ``(d) If the benefits of a household are reduced under a Federal, 
State, or local law relating to a welfare or public assistance program 
because of a penalty or for the failure to perform an action required 
under the law or program, for the duration of the reduction the 
household may not receive an increased allotment as the result of a 
decrease in the income of the household to the extent that the decrease 
is the result of the reduction. The State agency may reduce the 
allotment of the household by not more than 25 percent.''.

SEC. 327. PERMIT STATES TO DETERMINE MOST USEFUL AND RELIABLE MEANS OF 
              VERIFICATION.

    Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020) is amended 
by--
            (1) striking in subsection (e)(3) all that follows ``, and 
        that the State agency shall'' through ``(E)'';
            (2) inserting after the paragraph designation (19) of 
        subsection (e) ``at the option of the State agency,''; and
            (3) adding at the end the following new subsection--
    ``(p) Notwithstanding any other provision of law, State agencies 
(described in section 3(n)(1) of this Act) shall not be required to use 
an income and eligibility verification system established under section 
1137 of the Social Security Act (42 U.S.C. 1320b-7) or the immigration 
status verification system established under section 1137(d) of the 
Social Security Act (42 U.S.C. 1320b-7Id)).''.

SEC. 328. EXPAND CLAIMS COLLECTION METHODS.

    (a) Section 13 of the Food Stamp Act of 1977 (7 U.S.C. 2022) is 
amended by--
            (1) striking subsection (b) and inserting the following--
    ``(b)(1) Except as otherwise provided in this subsection, a State 
agency shall collect any overissuance of coupons issued to a household 
by--
            ``(A) reducing the allotment of the household;
            ``(B) withholding amounts from unemployment compensation 
        from a member of the household under subsection (c);
            ``(C) recovering from Federal pay or a Federal income tax 
        refund under subsection (d); or
            ``(D) any other means.
    ``(2) Paragraph (1) shall not apply if the State agency 
demonstrates to the satisfaction of the Secretary that all of the means 
referred to in paragraph (1) are not cost effective.
    ``(3) If a household received an overissuance of coupons without 
any member of the household being found ineligible to participate in 
the program under section 6(b)(1) and a State agency elects to reduce 
the allotment of the household under paragraph (1)(A), the State agency 
shall reduce the monthly allotment of the household under paragraph 
(1)(A) by the greater of--
            ``(A) 10 percent of the monthly allotment of the household; 
        or
            ``(B) $10.
    ``(4) A State agency shall collect an overissuance of coupons 
issued to a household under paragraph (1) in accordance with 
requirements established by the State agency for providing notice, 
electing a means of payment, and establishing a time schedule for 
payment.''; and
            (2) in subsection (d) by--
                    (A) striking ``as determined under subsection (b) 
                and except for claims arising from an error of the 
                State agency,'' and inserting ``, as determined under 
                subsection (b)(1),''; and
                    (B) inserting before the period at the end the 
                following--
    ``or a Federal income tax refund as authorized by section 3720A of 
title 31, United States Code''.
    (b) Section 11(e)(8) of the Food Stamp Act of 1977 (7 U.S.C. 
2020(e)(8)) is amended by--
            (1) striking ``and excluding claims'' and all that follows 
        through ``such section''; and
            (2) inserting before the semicolon at the end the 
        following--
    ``or a Federal income tax refund as authorized by section 3720A of 
title 31, United States Code''.
    (c) Section 16(a) of the Food Stamp Act of 1977 (7 U.S.C. 2025(a)) 
is amended by striking ``25 percent during the period beginning October 
1, 1990'' and all that follows through ``error of a State agency'' and 
inserting the following--
    ``25 percent of the overissuances collected by the State agency 
under section 13, except those overissuances arising from an error of 
the State agency''.
    (d) Section 6402(d) of the Internal Revenue Code (26 U.S.C. 
6402(d)) is amended by--
            (1) inserting in paragraph (1) after ``any Federal agency'' 
        the following--
    ``(or any State agency that has the responsibility for the 
administration of the food stamp program operated pursuant to the Food 
Stamp Act of 1977)''; and
            (2) inserting in the second sentence of paragraph (2) after 
        ``a Federal agency'' the following: ``(or a State agency that 
        has the responsibility for the administration of the food stamp 
        program operated pursuant to the Food Stamp Act of 1977)''.

SEC. 329. AUTHORIZE STATES TO OPERATE SIMPLIFIED FOOD STAMP PROGRAMS.

    (a) The Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.) is amended 
by adding the following new section 24--

                      ``simplified food stamp program

    ``Sec. 24. (a) In this section, the term `Federal costs' does not 
include any Federal costs incurred under section 17.
    ``(b) Subject to subsection (d), a State may elect to carry out a 
Simplified Food Stamp Program (referred to in this section as 
`Simplified Program') for households described in paragraph (c)(1), 
statewide or in a political subdivision of the state, in accordance 
with this section.
    ``(c) If a State elects to carry out a Simplified Program, within 
the State or a political subdivision of the State--
            ``(1) only households in which all members receive 
        assistance under a State program funded under part A of title 
        IV of the Social Security Act (42 U.S.C. 601 et seq.) shall 
        receive benefits under this section. Such households shall be 
        eligible automatically to participate in the Simplified 
        Program; and
            ``(2) subject to subsection (f), benefits under the 
        Simplified Program shall be determined under rules and 
        procedures established by the State under--
                    ``(A) a State program funded under part A of title 
                IV of the Social Security Act (42 U.S.C. 601 et seq.);
                    ``(B) the food stamp program; or
                    ``(C) a combination of a State program funded under 
                part A of title IV of the Social Security Act (42 
                U.S.C. 601 et seq.) and the food stamp program.
    ``(d)(1) A State agency may not operate a Simplified Program unless 
the Secretary approves a State plan for the operation of the Simplified 
Program under paragraph (2).
    ``(2) The Secretary may approve any State plan to carry out a 
Simplified Program if the Secretary determines that the plan--
            ``(A) simplifies program administration while fulfilling 
        the goals of the food stamp program to permit low-income 
        households to obtain a more nutritious diet;''
            ``(B) complies with this section;
            ``(C) would not increase Federal costs for any fiscal year; 
        and
            ``(D) would not substantially alter, as determined by the 
        Secretary, the appropriate distribution of benefits according 
        to household need.
    ``(e)(1) During each fiscal year and not later than 90 days after 
the end of each fiscal year, the Secretary shall determine, using data 
provided by the State agency and which the Secretary considers 
appropriate, whether a Simplified Program being carried out by a State 
agency is increasing Federal costs under this Act above what the costs 
would have been for the same population had they been subject to the 
rules of the Food Stamp Program.
    ``(2) If the Secretary determines that the Simplified Program has 
increased Federal costs under this Act for any fiscal year or any 
portion of any fiscal year, the Secretary shall notify the State not 
later than 30 days after the Secretary makes the determination under 
paragraph (1).
    ``(3)(A) Not later than 90 days after the date of a notification 
under paragraph (2), the State shall submit a plan for approval by the 
Secretary for prompt corrective action that is designed to prevent the 
Simplified Program from increasing Federal costs under this Act.
    ``(B) If the State does not submit a plan under subparagraph (A) or 
carry out a plan approved by the Secretary, the Secretary shall 
terminate the approval of the State agency operating the Simplified 
Program and the State agency shall be ineligible to operate a future 
Simplified Program.
    ``(f)(1) In operating a Simplified Program, a State or political 
subdivision of a State may follow the rules and procedures established 
by the State or political subdivision under a State program funded part 
A of title IV of the Social Security Act (42 U.S.C. 601 et seq.) or 
under the food stamp program.
    ``(2) In operating a Simplified Program, a State or political 
subdivision shall comply with the requirements of--
            ``(A) subsection 5(e) to the extent that it requires an 
        excess shelter expense deduction;
            ``(B) section 7(a) through (g);
            ``(C) section 8(a) (except that the income of a household 
        may be determined under a State program funded under part A of 
        title IV of the Social Security Act (42 U.S.C. 601 et seq.));
            ``(D) section 8(b) and (d);
            ``(E) section 11(a), (c), (d), and (n);
            ``(F) section 11(e) (8), (9), (12), (15), (17), (19), (23), 
        and (24);
            ``(G) section 11(e)(2), to the extent that it requires the 
        State agency to provide an application to households on the 
        first day they contact a food stamp office in person during 
        office hours to make what reasonably may be interpreted as an 
        oral or written request for food stamp assistance and to allow 
        those households to file the application on the same day.
            ``(H) section 11(e)(3), to the extent that it requires the 
        State agency to complete certification of an eligible household 
        and provide an allotment retroactive to the period of 
        application to an eligible household not later than 30 days 
        following the filing of an application;
            ``(I) section 11(e)(10) (or a comparable requirement 
        established by the State under a State program funded under 
        part A of title IV of the Social Security Act (42 U.S.C. 601 et 
        seq.)); and
            ``(J) section 16.
    ``(3) Notwithstanding any other provision of this section, a 
household may not receive benefits under this section as a result of 
the eligibility of the household under a State program funded under 
part A of title IV of the Social Security Act (42 U.S.C. 601 et seq.), 
unless the Secretary determines that any household with income above 
130 percent of the poverty guidelines is not eligible for the 
Program.''.
    (b) Section 8 of the Food Stamp Act of 1977 (7 U.S.C. 2017), as 
amended by this Act, is further amended by striking subsection (e) and 
redesignating subsection (f) as subsection (e).
    (c) Section 11(e) of the Food Stamp Act of 1977 (7 U.S.C. 2020(e)), 
as amended by this Act, is further amended by adding after paragraph 
(26), as added by section 323(b) of this Act, the following new 
paragraph--
            ``(27) if a State elects to carry out a Simplified Food 
        Stamp Program under section 24, the plans of the State agency 
        for operating the Simplified Program, including--
                    ``(A) the rules and procedures to be followed by 
                the State to determine food stamp benefits; and
                    ``(B) a description of the method by which the 
                State will carry out a quality control system under 
                section 16(c).''.
    (d) Section 17 of the Food Stamp Act of 1977 (7 U.S.C. 2026) is 
amended by--
            (1) striking subsection (i); and
            (2) redesignating subsections (j) through (l) as 
        subsections (i) through (k), respectively.

SEC. 330. REAUTHORIZE APPROPRIATIONS FOR THE FOOD STAMP PROGRAM.

    The first sentence of section 18(a)(1) of the Food Stamp Act of 
1977 (7 U.S.C. 2027(a)(1)) is amended by striking ``1997'' and 
inserting ``2002''.

                     PART 2--NONBUDGETARY PROPOSALS

SEC. 341. EXPAND DEFINITION OF COUPON.

    Section 3(d) of the Food Stamp Act of 1977 (7 U.S.C. 2012(d)) is 
amended by striking ``or type of certificate'' and inserting ``type of 
certificate, authorization card, cash or check issued in lieu of a 
coupon, or an access device, including an electronic benefits transfer 
card or a personal identification number,''.

SEC. 342. CLARIFY DEFINITION OF HOMELESS INDIVIDUAL.

    Section 3(s)(2)(C) of the Food Stamp Act of 1977 (7 U.S.C. 
2012(s)(2)(C)) is amended by inserting ``for not more than 90 days'' 
after ``temporary accommodation''.

SEC. 343. PROVIDE STATE OPTION FOR ELIGIBILITY STANDARDS.

    Section 5(b) of the Food Stamp Act of 1977 (7 U.S.C. 2014(d)) is 
amended by striking ``(b) The Secretary'' and inserting the following--
    ``(b) Except as otherwise provided in this Act, the Secretary''.

SEC. 344. DOUBLE PENALTIES FOR VIOLATING FOOD STAMP PROGRAM 
              REQUIREMENTS.

    Section 6(b)(1) of the Food Stamp Act of 1977 (7 U.S.C. 2015(b)(1)) 
is amended--
            (1) in clause (i), by striking ``six months upon'' and 
        inserting ``1 year on''; and
            (2) in clause (ii), by striking ``1 year'' and inserting 
        ``2 years''.

SEC. 345. PROVIDE STATE OPTION TO LOWER AGE OF CARETAKER EXEMPTION.

    Section 6(d)(2) of the Food Stamp Act of 1977 (7 U.S.C. 2015(d)(2)) 
is amended by striking subparagraph (B) and inserting the following--
                    ``(B) a parent or other member of a household with 
                responsibility for the care of (i) a dependent child 
                under the age of 6 or any lower age designated by the 
                State agency that is not under the age of 1 if adequate 
                child care is not available, or (ii) an incapacitated 
                person;''.

SEC. 346. REVISE EMPLOYMENT AND TRAINING.

    (a) In General.--Section 6(d)(4) of the Food Stamp Act of 1977 (7 
U.S.C. 2015(d)(4)) is amended--
            (1) in subparagraph (A)--
                    (A) by striking ``Not later than April 1, 1987, 
                each'' and inserting ``Each'';
                    (B) by inserting ``work,'' after ``skills, 
                training,''; and
                    (C) by adding at the end the following--
    ``Each component of an employment and training program carried out 
under this paragraph may be delivered through a statewide workforce 
development system, unless the component is not available locally 
through the statewide workforce development system.'';
            (2) in subparagraph (B)--
                    (A) in the matter preceding clause (i), by striking 
                the colon at the end and inserting the following--
    ``, except that the State agency shall retain the option to apply 
employment requirements prescribed under this subparagraph to a program 
applicant at the time of application:'';
                    (B) in clause (i), by striking ``with terms and 
                conditions'' and all that follows through ``time of 
                application''; and
                    (C) in clause (iv)--
                            (i) by striking subclauses (I) and (II); 
                        and
                            (ii) by redesignating subclauses (III) and 
                        (IV) as subclauses (I) and (II), respectively;
            (3) in subparagraph (D)--
                    (A) in clause (i), by striking ``to which the 
                application'' and all that follows through ``30 days or 
                less'';
                    (B) in clause (ii), by striking ``but with 
                respect'' and all that follows through ``child care''; 
                and
                    (C) in clause (iii), by striking ``, on the basis 
                of'' and all that follows through ``clause (ii)'' and 
                inserting ``the exemption continues to be valid'';
            (4) in subparagraph (E), by striking the third sentence;
            (5) in subparagraph (G)--
                    (A) by striking ``(G)(i) The State'' and inserting 
                ``(G) The State''; and
                    (B) by striking clause (ii);
            (6) in subparagraph (H), by striking ``(H)(i) The 
        Secretary'' and all that follows through ``(ii) Federal funds'' 
        and inserting ``(H) Federal funds'';
            (7)(A) by striking subparagraphs (K) and (L) and inserting 
        the following--
                    ``(K) Notwithstanding any other provision of this 
                paragraph, the amount of funds a State agency uses to 
                carry out this paragraph (including under subparagraph 
                (I)) for participants who are receiving benefits under 
                a State program funded under part A of title IV of the 
                Social Security Act (42 U.S.C. 601 et seq.) shall not 
                exceed the amount of funds the State agency used in 
                fiscal year 1995 to carry out this paragraph for 
                participants who were receiving benefits in fiscal year 
                1995 under a State program funded under part A of title 
                IV of the Social Security Act (42 U.S.C. 601 et 
                seq.).''; and
            (B) by redesignating subparagraphs (M) and (N) as 
        subparagraphs (L) and (M), respectively; and
            (8) in subparagraph (L) (as redesignated by paragraph 
        (8)(B))--
                    (A) by striking ``(L)(i) The Secretary'' and 
                inserting ``(L) The Secretary''; and
                    (B) by striking clause (ii).
    (b) Section 16(h) of the Food Stamp Act of 1977 (7 U.S.C. 2025(h)) 
is amended--
            (1) in paragraph (5)--
                    (A) by striking ``(5)(A) The Secretary'' and 
                inserting ``(5) The Secretary''; and
                    (B) by striking subparagraph (B); and
            (2) by striking paragraph (6).

SEC. 347. DISQUALIFY FLEEING FELONS.

    Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as amended 
by this Act, is further amended by adding at the end the following new 
subsection--
    ``(k) No member of a household who is otherwise eligible to 
participate in the food stamp program shall be eligible to participate 
in the program as a member of that or any other household during any 
period during which the individual is--
            ``(1) fleeing to avoid prosecution, or custody or 
        confinement after conviction, under the law of the place from 
        which the individual is fleeing, for a crime, or attempt to 
        commit a crime, that is a felony under the law of the place 
        from which the individual fleeing or that, in the case of New 
        Jersey, is a high misdemeanor under the law of New Jersey; or
            ``(2) violating a condition of probation or parole imposed 
        under Federal or State law.''.

SEC. 348. ENCOURAGE ELECTRONIC BENEFIT TRANSFER SYSTEMS.

    (a) Section 7(g) of the Food Stamp Act of 1977 (7 U.S.C. 2016(g)) 
is amended by--
            (1) striking ``(1)'';
            (2) striking paragraph (2); and
            (3) striking ``(A)'' and ``(B)'' and inserting in lieu 
        thereof ``(1)'' and ``(2)'', respectively.
    (b) Section 7(i) of the Food Stamp Act of 1977 (7 U.S.C. 2016(i) is 
amended by--
            (1) striking paragraph (1) and inserting the following--
            ``(1)(A) Each State agency shall implement an electronic 
        benefit transfer system in which household benefits determined 
        under section 8(a) or 24 are issued from and stored in a 
        central databank before October 1, 2002, unless the Secretary 
        provides a waiver for a State agency that faces unusual 
        barriers to implementing an electronic benefit transfer system.
            ``(B) Subject to paragraph (2), a State agency may procure 
        and implement an electronic benefit transfer system under the 
        terms, conditions, and design that the State agency considers 
        appropriate.
            ``(C) An electronic benefit transfer system should take 
        into account generally accepted standard operating rules based 
        on--
                    ``(i) commercial electronic funds transfer 
                technology;
                    ``(ii) the need to permit interstate operation and 
                law enforcement monitoring; and
                    ``(iii) the need to permit monitoring and 
                investigations by authorized law enforcement 
                agencies.'';
            (2) striking subparagraph (2)(A) and redesignating 
        subparagraphs (B) through (H) as (A) through (G), respectively; 
        and
            (3) adding at the end the following--
            ``(7) A State agency may collect a charge for replacement 
        of an electronic benefit transfer card by reducing the monthly 
        allotment of the household receiving the replacement card.
            ``(8)(A) A State agency may require that an electronic 
        benefit card contain a photograph of 1 or more members of a 
        household.
            ``(B) If a State agency requires a photograph on an 
        electronic benefit card under subparagraph (A), the State 
        agency shall establish procedures to ensure that any other 
        appropriate member of the household or any authorized 
        representative of the household may utilize the card.''; and
    (c) Section 10 of the Food Stamp Act of 1977 (7 U.S.C. 2019) is 
amended by inserting before the period at the end of the first sentence 
the following: ``unless such centers, organizations, institutions, 
shelters, group living arrangements, and establishments are equipped 
with point-of-sale devices for the purpose of participating in 
electronic benefit transfer delivery systems''.

SEC. 349. AUTHORIZE EXCHANGE OF LAW ENFORCEMENT INFORMATION.

    Section 11(e)(8) of the Food Stamp Act of 1977 (7 U.S.C. 
2020(e)(8)), as amended by this Act, is further amended as follows--
            (1) by striking ``and'' before ``(C)''; and
            (2) by adding at the end the following: ``and (D) 
        notwithstanding any other law, the address, social security 
        number, and, if available, photograph of any member of a 
        household shall be made available, on request, to any Federal, 
        State, or local law enforcement officer if the officer 
        furnishes the State agency with the name of the member and 
        notifies the agency that--
                            ``(i) the member--
                                    ``(I) is fleeing to avoid 
                                prosecution, or custody or confinement 
                                after conviction, for a crime (or 
                                attempt to commit a crime) that, under 
                                the law of the place the member is 
                                fleeing, is a felony (or, in the case 
                                of New Jersey, a high misdemeanor), or 
                                is violating a condition of probation 
                                or parole imposed under Federal or 
                                State law; or
                                    ``(II) has information that is 
                                necessary for the officer to conduct an 
                                official duty relayed to subclause (I);
                            ``(ii) locating or apprehending the member 
                        is an official duty; and
                            ``(iii) the request is being made in the 
                        proper exercise of an official duty; and
                    ``(E) the safeguards shall not prevent compliance 
                with paragraph (16);''.

SEC. 350. SIMPLIFY ADMINISTRATION OF EXPEDITED SERVICE.

    Section 11(e)(9) of the Food Stamp Act of 1977 (7 U.S.C. 
2020(e)(9)) is amended--
            (1) in subparagraph (A)--
                    (A) by striking ``five days'' and inserting ``7 
                days''; and
                    (B) by inserting ``and'' at the end;
            (2) by striking subparagraphs (B) and (C);
            (3) by redesignating subparagraph (D) as subparagraph (B); 
        and
            (4) in subparagraph (B), as redesignated by paragraph (3), 
        by striking ``, (B), or (C)''.

              PART 3--ADMINISTRATIVE FLEXIBILITY PROPOSALS

SEC. 361. EXPAND STATE AUTHORITY TO DEFINE CERTIFICATION PERIOD.

    Section 3(c) of the Food Stamp Act of 1977 (7 U.S.C. 2012(c)) is 
amended by striking ``Except as provided'' and all that follows and 
inserting the following--
    ``The certification period shall not exceed 12 months, except that 
the certification period may be up to 24 months if all adult household 
members are elderly or disabled. A State agency shall have at least 1 
contact with each certified household every 12 months.''.

SEC. 362. PROVIDE STATE OPTION TO COMBINE ALLOTMENTS FOR EXPEDITED 
              SERVICE HOUSEHOLDS.

    Section 8(c) of the Food Stamp Act of 1977 (7 U.S.C. 2017(c)) is 
amended by striking paragraph (3) and inserting the following:
            ``(3) A State agency may provide to an eligible household 
        applying after the 15th day of a month, in lieu of the initial 
        allotment of the household and the regular allotment of the 
        household for the following month, an allotment that is equal 
        to the total amount of the initial allotment and the first 
        regular allotment. The allotment shall be provided in 
        accordance with section 11(e)(3) in the case of a household 
        that is not entitled to expedited service and in accordance 
        with paragraphs (3) and (9) of section 11(e) in the case of a 
        household that is entitled to expedited service.''.

SEC. 363. REVISE TREATMENT OF ALLOTMENTS FOR HOUSEHOLDS RESIDING IN 
              CENTERS.

    Section 8 of the Food Stamp Act of 1977 (7 U.S.C. 2017) is amended 
by adding at the end the following:
    ``(f)(1) In the case of an individual who resides in a center for 
the purpose of a drug or alcoholic treatment program described in the 
last sentence of section 3(i), a State agency may provide an allotment 
for the individual to--
            ``(A) the center as an authorized representative of the 
        individual for a period that is less than 1 month; and
            ``(B) the individual, if the individual leaves the center.
    ``(2) A State agency may require an individual referred to in 
paragraph (1) to designate the center in which the individual resides 
as the authorized representative of the individual for the purpose of 
receiving an allotment.''.

SEC. 364. IMPROVE OPERATION OF FOOD STAMP OFFICES.

    Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020) is 
amended--
            (1) in subsection (e)--
                    (A) by striking paragraph (2) and inserting the 
                following--
            ``(2)(A) that the State agency shall establish procedures 
        governing the operation of food stamp offices that the State 
        agency determines best serve households in the State, including 
        households with special needs, such as households with elderly 
        or disabled members, households with low-income members who 
        reside in rural areas, homeless individuals, households 
        residing on reservations, and households in which a substantial 
        number of members speak a language other than English.
            ``(B) In carrying out subparagraph (A), a State agency--
                    ``(i) shall provide timely, accurate, and fair 
                service to applicants for, and participants in, the 
                food stamp program;
                    ``(ii) shall develop an application containing the 
                information necessary to comply with this Act;
                    ``(iii) shall permit an applicant household to 
                apply to participate in the program on the same day 
                that the household first contacts a food stamp office 
                in person during office hours;
                    ``(iv) shall consider an application that contains 
                the name, address, and signature of the applicant filed 
                on the date the applicant submits the application;
                    ``(v) shall require that an adult representative of 
                each applicant household certify in writing, under 
                penalty of perjury, that--
                            ``(I) the information contained in the 
                        application is true; and
                            ``(II) all members of the household are 
                        citizens or are aliens eligible to receive food 
                        stamps under section 6(f);
                    ``(vi) shall provide a method of certifying and 
                issuing coupons to eligible homeless individuals, to 
                ensure that participation in the food stamp program is 
                limited to eligible households; and
                    ``(vii) may establish operating procedures that 
                vary for local food stamp offices to reflect regional 
                and local differences within the State;'';
            ``(C) Nothing in this Act shall prohibit the use of 
        signatures provided and maintained electronically, storage of 
        records using automated retrieval systems only, or any other 
        features of a State agency's application system that does not 
        rely exclusively on the collection and retention of paper 
        applications or other records.
            ``(D) The signature of any adult under this paragraph shall 
        be sufficient to comply with any provision of Federal law 
        requiring a household member to sign an application or 
        statement.'';
                    (B) in paragraph (3) by striking ``and that the 
                State agency shall provide the household'' and all that 
                follows through ``representative of the State 
                agency.'';
                    (C) by striking paragraphs (14) and (25); and
                    (D) by redesignating paragraphs (15) through (27) 
                as paragraphs (14) through (25), respectively; and
            (2) in subsection (i)--
                    (A) by striking ``(i) Notwithstanding'' and all 
                that follows through ``(2)'' and inserting the 
                following--
    ``(i)(1) Notwithstanding any other provision of law,''; and
                    (B) by striking ``; (3) households'' and all that 
                follows through ``title IV of the Social Security Act. 
                No'' and inserting a period and the following--
    ``(2) Other than in a case of disqualification as a penalty for 
failure to comply with a public assistance program rule or regulation, 
no''.

SEC. 365. DELETE FEDERAL REQUIREMENT FOR STATE EMPLOYEE TRAINING.

    Section 11(e)(6) of the Food Stamp Act of 1977 (7 U.S.C. 
2020(e)(6)) is amended by--
            (1) inserting ``and'' at the end of subparagraph (B);
            (2) striking in subparagraph (B), ``United States Civil 
        Service Commission'' and inserting ``Office of Personnel 
        Management''; and
            (3) striking subparagraphs (C) through (E).

SEC. 366. AUTHORIZE ORAL WITHDRAWAL OF FAIR HEARING REQUESTS.

    Section 11(e)(10) of the Food Stamp Act of 1977 (7 U.S.C. 
2020(e)(10)) is amended by inserting before the semicolon at the end a 
period and the following:
    ``At the option of a State, at any time prior to a fair hearing 
determination under this paragraph, a household may withdraw, orally or 
in writing, a request by the household for a fair hearing. If the 
withdrawal request is an oral request, the State agency shall provide a 
written notice to the household confirming the withdrawal request and 
providing the household with an opportunity to request a hearing''.

SEC. 367. DELETE REDUNDANT FEDERAL STANDARDS FOR ADMINISTRATION.

    (a) Section 16 of the Food Stamp Act of 1977 (7 U.S.C. 2025) is 
amended by striking subsection (b).
    (b) The first sentence of section 11(g) of the Food Stamp Act of 
1977 (7 U.S.C. 2020(g)) is amended by striking ``the Secretary's 
standards for the efficient and effective administration of the program 
established under section 16(b)(1) or''.
    (c) Section 16(c)(1)(B) of the Food Stamp Act of 1977 (7 U.S.C. 
2025(c)(1)(B)) is amended by striking ``pursuant to subsection (b)''.

        PART 4--PROPOSALS FOR STRENGTHENING RETAILER MANAGEMENT

SEC. 371. PROVIDE AUTHORITY TO ESTABLISH AUTHORIZATION PERIODS.

    Section 9(a) of the Food Stamp Act of 1977 (7 U.S.C. 2018(a)) is 
amended by adding at the end the following--
            ``(3) The Secretary shall establish specific time periods 
        during which authorization to accept and redeem coupons or to 
        redeem benefits through an electronic benefit transfer system 
        shall be valid under the food stamp program.''.

SEC. 372. PROVIDE AUTHORITY TO REQUIRE INFORMATION FOR VERIFYING 
              ELIGIBILITY FOR AUTHORIZATION.

    Section 9(c) of the Food Stamp Act of 1977 (7 U.S.C. 2018(c)) is 
amended--
            (1) in the first sentence, by inserting ``, which may 
        include relevant income and sales tax filing documents,'' after 
        ``submit information''; and
            (2) by inserting after the first sentence the following--
    ``The regulations may require retail food stores and wholesale food 
concerns to provide written authorization for the Secretary to verify 
all relevant tax filings with appropriate agencies and to obtain 
corroborating documentation from other sources so that the accuracy of 
information provided by the stores and concerns may be verified.''.

SEC. 373. ESTABLISH WAITING PERIOD FOR STORES THAT INITIALLY FAIL TO 
              MEET AUTHORIZATION CRITERIA.

    Section 9(d) of the Food Stamp Act of 1977 (7 U.S.C. 2018(d)) is 
amended by adding at the end the following--
    ``A retail food store or wholesale food concern that is denied 
approval to accept and redeem coupons because the store or concern does 
not meet criteria for approval established by the Secretary may not, 
for at least 6 months, submit a new application to participate in the 
program. The Secretary may establish a longer time period under the 
preceding sentence, including permanent disqualification, that reflects 
the severity of the basis of the denial.''.

SEC. 374. DISQUALIFY RETAILERS WHO INTENTIONALLY SUBMIT FALSIFIED 
              APPLICATIONS.

    Section 12(b) of the Food Stamp Act of 1977 (7 U.S.C. 2021(b)) is 
amended by--
            (1) striking at the end of paragraph (2) ``and'';
            (2) striking in paragraph (3) the period at the end and 
        inserting ``, and''; and
            (3) adding at the end the following--
            ``(4) for a reasonable period of time to be determined by 
        the Secretary, including permanent disqualification, on the 
        knowing submission of an application for the approval or 
        reauthorization to accept and redeem coupons that contain false 
        information about a substantive matter that was a part of the 
        application.''.

SEC. 375. DISQUALIFY RETAILERS WHO ARE DISQUALIFIED UNDER THE WIC 
              PROGRAM.

    Section 12 of the Food Stamp Act of 1977 (7 U.S.C. 2021) is amended 
by adding at the end the following--
    ``(g)(1) The Secretary shall issue regulations providing criteria 
for the disqualification under this Act of an approved retail food 
store and a wholesale food concern that is disqualified from accepting 
benefits under the special supplemental nutrition program for women, 
infants, and children established under section 17 of the Child 
Nutrition Act of 1966 (7 U.S.C. 1786).
    ``(2) A disqualification under paragraph (1)--
            ``(A) shall be for the same period as the disqualification 
        from the program referred to in paragraph (1);
            ``(B) may begin at a later date than the disqualification 
        from the program referred to in paragraph (1); and
            ``(C) notwithstanding section 14, shall not be subject to 
        judicial or administrative review.''.

SEC. 376. AUTHORIZE SUSPENSION OF STORES VIOLATING PROGRAM REQUIREMENTS 
              PENDING ADMINISTRATIVE AND JUDICIAL REVIEW.

    Section 14(a) of the Food Stamp Act of 1977 (7 U.S.C. 2023(a)) is 
amended by--
            (1) redesignating the first through seventeenth sentences 
        as paragraphs (1) through (17), respectively; and
            (2) adding at the end the following:
            ``(18) Notwithstanding any other provision of this 
        subsection, any permanent disqualification of a retail food 
        store or wholesale food concern under paragraph (3) or (4) of 
        section 12(b) shall be effective from the date of receipt of 
        the notice of disqualification. If the disqualification is 
        reversed through administrative or judicial review, the 
        Secretary shall not be liable for the value of any sales lost 
        during the disqualification period.''.

SEC. 377. EXPAND CIVIL AND CRIMINAL FORFEITURE FOR VIOLATIONS OF THE 
              FOOD STAMP ACT.

    (a) The first sentence of section 15(g) of the Food Stamp Act of 
1977 (7 U.S.C. 2024(g)) is amended by striking ``or intended to be 
furnished''.
    (b) Section 15 of the Food Stamp Act of 1977 (7 U.S.C. 2024) is 
amended by adding the following new subsections:
    ``(h) Civil Forfeiture.--
            ``(1) Any property, real or personal,
                    ``(A) constituting, derived from, or traceable to 
                any proceeds obtained directly or indirectly from, or
                    ``(B) used, or intended to be used, to commit or to 
                facilitate, the commission of a violation (other than a 
                misdemeanor) of subsection (b) or (c) of this section, 
                shall be subject to forfeiture to the United States.
            ``(2) The provisions of chapter 46 of title 18, relating to 
        civil forfeitures shall extend to a seizure or forfeiture under 
        this subsection, insofar as applicable and not inconsistent 
        with the provisions of this subsection, except that such duties 
        as are imposed upon the Secretary of the Treasury under chapter 
        46 shall be performed with respect to seizures and forfeitures 
under this section by such officers, agents, and other persons as 
designated for that purpose by the Secretary, U.S. Department of 
Agriculture.
            ``(3) Forfeitures imposed under this subsection shall be in 
        addition to any criminal sanctions imposed against the owner of 
        the forfeited property.
    ``(i) Criminal Forfeiture.--
            ``(1) In imposing sentence upon any person convicted of a 
        violation (other than a misdemeanor) of subsection (b) or 
        subsection (c) of this section, the court shall order that the 
        person forfeit to the United States, irrespective of any State 
        law--
                    ``(A) any property, real or personal, constituting, 
                derived from, or traceable to any proceeds such person 
                obtained directly or indirectly as a result of such 
                violation; and
                    ``(B) any of such person's property used, or 
                intended to be used, to commit or to facilitate the 
                commission of such violation.
            ``(2) All property subject to forfeiture under this 
        subsection, any seizure and disposition thereof, and any 
        proceeding relating thereto, shall be governed by section 413 
        of the Comprehensive Drug Abuse Prevention and Control Act of 
        1970 (21 U.S.C. 853), with the exception of section 413(d), 
        insofar as applicable and not inconsistent with the provisions 
        of this subsection.
            ``(3) Restraining orders available under section 413(e) of 
        the Comprehensive Drug Abuse Prevention and Control Act of 1970 
        (21 U.S.C. 853(e)) shall apply to assets otherwise subject to 
        forfeiture under section 413(p) of that Act (21 U.S.C. 853(p)), 
        as incorporated in this subsection.''.

SEC. 378. EXPAND AUTHORITY FOR SHARING INFORMATION PROVIDED BY RETAIL 
              FOOD STORES AND WHOLESALE FOOD CONCERNS.

    (a) Section 205(c)(2)(C)(iii) of the Social Security Act (42 U.S.C. 
405(c)(2)(C)(iii)), as amended by section 316(a) of the Social Security 
Administrative Reform Act of 1994 (Public Law 103-296; 108 Stat. 1464), 
is amended by--
            (1) inserting in the first sentence of subclause (II) after 
        ``instrumentality of the United States'' the following: ``, or 
        State government officers and employees with law enforcement or 
        investigative responsibilities, or State agencies that have the 
        responsibility for administering the Special Supplemental 
        Nutrition Program for Women, Infants and Children (WIC)'';
            (2) inserting in the last sentence of subclause (II) ``or 
        State'' after ``other Federal''; and
            (3) inserting in subclause (III) ``or a State'' after 
        ``United States''.
    (b) Section 6109(f)(2) of the Internal Revenue Code of 1986 (26 
U.S.C. 6109(f)(2)) (as added by section 316(b) of the Social Security 
Administrative Reform Act of 1994 (Public Law 103-296; 108 Stat. 1464)) 
is amended by--
            (1) inserting in subparagraph (A) after ``instrumentality 
        of the United States'' the following: ``, or State government 
        officers and employees with law enforcement or investigative 
        responsibilities, or State agencies that have the 
        responsibility for administering the Special Supplemental 
        Nutrition Program for Women, Infants and Children (WIC)'';
            (2) inserting in the last sentence of subparagraph (A) ``or 
        State'' after ``other Federal''; and
            (3) inserting in subparagraph (B) ``or a State'' after 
        ``United States''.

           PART 5--CONFORMING AMENDMENTS AND EFFECTIVE DATES

SEC. 381. CONFORMING AMENDMENTS.

    (a) Section 5(k)(1)(A) of the Food Stamp Act of 1977 (7 U.S.C. 
2014(k)(1)(A)) is amended by striking ``for aid to families with 
dependent children''.
    (b) Section 6(e)(6) of the Food Stamp Act of 1977 (7 U.S.C. 
2015(e)(6)) is amended by striking ``aid to families with dependent 
children'' and inserting ``assistance''.
    (c) Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020) is 
amended by--
            (1) striking in the first complete sentence of subsection 
        (e)(2) ``aid to families with dependent children''; and
            (2) striking in subsection (i) ``aid to families with 
        dependent children''.
    (d) Section 16(g) of the Food Stamp Act of 1977 (7 U.S.C. 2025(g)) 
is amended in item (4) by striking ``Aid to Families with Dependent 
Children Program'' and inserting ``program''.
    (e) Section 17(b) of the Food Stamp Act of 1977 (7 U.S.C. 2026(b)) 
is amended by--
            (1) striking in the first sentence of paragraph (1)(A) 
        ``aid to families with dependent children'' and inserting 
        ``assistance'';
            (2) striking in paragraph (3)(B) ``for recipients of aid to 
        families with dependent children'';
            (3) inserting before the period at the end of the first 
        sentence in paragraph (3)(B) the following:
    ``for recipients of assistance under part A of title IV of the 
Social Security Act (42 U.S.C. 601 et seq.)''; and
            (4) striking in paragraph (3)(C) ``'aid to families with 
        dependent children''' and inserting the following:
    ``assistance under part A of title IV of the Social Security Act 
(42 U.S.C. 601 et seq.)''.

SEC. 382. EFFECTIVE DATES.

    Except as otherwise provided in this subtitle, the provisions of 
this subtitle become effective on the first day of the second month 
after the month of enactment.

                      Subtitle B--Child Nutrition

SEC. 391. FAMILY OR GROUP DAY CARE HOMES.

    (a) Restructured Day Care Home Reimbursements.--Section 17(f)(3) of 
the National School Lunch Act (42 U.S.C. 1766(f)(3)) is amended by 
striking ``(3)(A) Institutions'' and all that follows through the end 
of subparagraph (A) and inserting the following:
            ``(3) Reimbursement of family or group day care home 
        sponsoring organizations.--
                    ``(A) Reimbursement factor.--
                            ``(i) In general.--An institution that 
                        participates in the program under this section 
                        as a family or group day care home sponsoring 
                        organization shall be provided, for payment to 
                        a home sponsored by the organization, 
                        reimbursement factors in accordance with this 
                        subparagraph for the cost of obtaining and 
                        preparing food and prescribed labor costs 
                        involved in providing meals under this section.
                            ``(ii) Tier i family or group day care 
                        homes.--
                                    ``(I) Definition.--In this 
                                paragraph, the term `tier I family or 
                                group day care home' means--
                                            ``(aa) a family or group 
                                        day care home that is located 
                                        in a geographic area, as 
                                        defined by the Secretary based 
                                        on census data, in which at 
                                        least 50 percent of the 
                                        children residing in the area 
                                        are members of households whose 
                                        incomes meet the income 
                                        eligibility guidelines for free 
                                        or reduced price meals under 
                                        section 9;
                                            ``(bb) a family or group 
                                        day care home that is located 
                                        in an area served by a school 
                                        enrolling elementary students 
                                        in which at least 50 percent of 
                                        the total number of children 
                                        enrolled are certified eligible 
                                        to receive free or reduced 
                                        price school meals under this 
                                        Act or the Child Nutrition Act 
                                        of 1966 (42 U.S.C. 1771 et 
                                        seq.); or
                                            ``(cc) a family or group 
                                        day care home that is operated 
                                        by a provider whose household 
                                        meets the eligibility 
                                        requirements for free or 
                                        reduced price meals under 
                                        section 9 and whose eligibility 
                                        is verified by the sponsoring 
                                        organization of the home under 
                                        regulations established by the 
                                        Secretary.
                                    ``(II) Reimbursement.--Except as 
                                provided in subclause (III), a tier I 
                                family or group day care home shall be 
                                provided reimbursement factors under 
                                this clause without a requirement for 
                                documentation of the costs described in 
                                clause (i), except that reimbursement 
                                shall not be provided under this 
                                subclause for meals or supplements 
                                served to the children of a person 
                                acting as a family or group day care 
                                home provider unless the children meet 
                                the eligibility requirements for free 
                                or reduced price meals under section 9.
                                    ``(III) Factors.--Except as 
                                provided in subclause (IV), the 
                                reimbursement factors applied to a home 
                                referred to in subclause (II) shall be 
                                the factors in effect on the date of 
                                enactment of this subclause.
                                    ``(IV) Adjustments.--The 
                                reimbursement factors under this 
                                subparagraph shall be adjusted on 
                                October 1, 1996, July 1, 1997, and each 
                                July 1 thereafter, to reflect changes 
                                in the Consumer Price Index for food at 
                                home for the most recent 12-month 
                                period for which the data are 
                                available. The reimbursement factors 
                                under this subparagraph shall be 
                                rounded to the nearest lower cent 
                                increment and based on the unrounded 
                                adjustment in effect on June 30 of the 
                                preceding school year.
                            ``(iii) Tier ii family or group day care 
                        homes.--
                                    ``(I) In general.--
                                            ``(aa) Factors.--Except as 
                                        provided in subclause (II), 
                                        with respect to meals or 
                                        supplements served under this 
                                        clause by a family or group day 
                                        care home that does not meet 
                                        the criteria set forth in 
                                        clause (ii)(I), the 
                                        reimbursement factors shall be 
                                        $1 for lunches and suppers, 30 
                                        cents for breakfasts, and 15 
                                        cents for supplements.
                                            ``(bb) Adjustments.--The 
                                        factors shall be adjusted on 
                                        July 1, 1997, and each July 1 
                                        thereafter, to reflect changes 
                                        in the Consumer Price Index for 
                                        food at home for the most 
                                        recent 12-month period for 
                                        which the data are available. 
                                        The reimbursement factors under 
                                        this item shall be rounded down 
                                        to the nearest lower cent 
                                        increment and based on the 
                                        unrounded adjustment for the 
                                        preceding 12-month period.
                                            ``(cc) Reimbursement.--A 
                                        family or group day care home 
                                        shall be provided reimbursement 
                                        factors under this subclause 
                                        without a requirement for 
                                        documentation of the costs 
                                        described in clause (i), except 
                                        that reimbursement shall not be 
                                        provided under this subclause 
                                        for meals or supplements served 
                                        to the children of a person 
                                        acting as a family or group day 
                                        care home provider unless the 
                                        children meet the eligibility 
                                        requirements for free or 
                                        reduced price meals under 
                                        section 9.
                                    ``(II) Other factors.--A family or 
                                group day care home that does not meet 
                                the criteria set forth in clause 
                                (ii)(I) may elect to be provided 
                                reimbursement factors determined in 
                                accordance with the following 
                                requirements:
                                            ``(aa) Children eligible 
                                        for free or reduced price 
                                        meals.--In the case of meals or 
                                        supplements served under this 
                                        subsection to children who meet 
                                        the eligibility requirements 
for free or reduced price meals under section 9, the family or group 
day care home shall be provided reimbursement factors set by the 
Secretary in accordance with clause (ii)(III).
                                            ``(bb) Ineligible 
                                        children.--In the case of meals 
                                        or supplements served under 
                                        this subsection to children who 
                                        do not meet the eligibility 
                                        requirements for free or 
                                        reduced price meals under 
                                        section 9, the family or group 
                                        day care home shall be provided 
                                        reimbursement factors in 
                                        accordance with subclause (I).
                                    ``(III) Information and 
                                determinations.--
                                            ``(aa) In general.--If a 
                                        family or group day care home 
                                        elects to claim the factors 
                                        described in subclause (II), 
                                        the family or group day care 
                                        home sponsoring organization 
                                        serving the home shall collect 
                                        the necessary eligibility 
                                        information, as determined by 
                                        the Secretary, from any parent 
                                        or other caretaker to make the 
                                        determinations specified in 
                                        subclause (II) and shall make 
                                        the determinations in 
                                        accordance with rules 
                                        prescribed by the Secretary.
                                            ``(bb) Categorical 
                                        eligibility.--In making a 
                                        determination under item (aa), 
                                        a family or group day care home 
                                        sponsoring organization may 
                                        consider a child participating 
                                        in or subsidized under, or a 
                                        child with a parent 
                                        participating in or subsidized 
                                        under, a federally or State 
                                        supported child care or other 
                                        benefit program with an income 
                                        eligibility limit that does not 
                                        exceed the income eligibility 
                                        guidelines standard for free or 
                                        reduced price meals under 
                                        section 9 to be a child who is 
                                        eligible for free or reduced 
                                        price meals under section 9.
                                            ``(cc) Factors for children 
                                        only.--A family or group day 
                                        care home may elect to receive 
                                        the reimbursement factors 
                                        prescribed under clause 
                                        (ii)(III) solely for the 
                                        children participating in a 
                                        program referred to in item 
                                        (bb) if the home elects not to 
                                        have eligibility information 
                                        collected from parents or other 
                                        caretakers.''.
    (b) Grants to States To Provide Assistance to Family or Group Day 
Care Homes.--Section 17(f)(3) of the National School Lunch Act (42 
U.S.C. 1766(f)(3)) is amended by adding at the end the following--
                    ``(D) Grants to states to provide assistance to 
                family or group day care homes.--
                            ``(i) In general.--
                                    ``(I) Reservation.--The Secretary 
                                shall reserve $5,000,000 of the amount 
                                made available to carry out this 
                                section for fiscal year 1996.
                                    ``(II) Purpose.--The Secretary 
                                shall use the funds made available 
                                under subclause (I) to provide grants 
                                to States for the purpose of 
                                providing--
                                            ``(aa) assistance, 
                                        including grants, to family and 
                                        day care home sponsoring 
                                        organizations and other 
                                        appropriate organizations, in 
                                        securing and providing 
                                        training, materials, automated 
                                        data processing assistance, and 
                                        other assistance for the staff 
                                        of the sponsoring 
                                        organizations; and
                                            ``(bb) training and other 
                                        assistance to family and group 
                                        day care homes in the 
                                        implementation of the 
                                        amendments to subparagraph (A) 
                                        made by section 391(a) of the 
                                        Work First and Personal 
                                        Responsibility Act of 1996.
                            ``(ii) Allocation.--The Secretary shall 
                        allocate from the funds reserved under clause 
                        (i)(I)--
                                    ``(I) $30,000 in base funding to 
                                each State; and
                                    ``(II) any remaining amount among 
                                the States, based on the number of 
                                family day care homes participating in 
                                the program in a State during fiscal 
                                year 1994 as a percentage of the number 
                                of all family day care homes 
                                participating in the program during 
                                fiscal year 1994.
                            ``(iii) Retention of funds.--Of the amount 
                        of funds made available to a State for fiscal 
                        year 1996 under clause (i), the State may 
                        retain not to exceed 30 percent of the amount 
                        to carry out this subparagraph.
                            ``(iv) Additional payments.--Any payments 
                        received under this subparagraph shall be in 
                        addition to payments that a State receives 
                        under subparagraph (A) (as amended by section 
                        391(a) of the Work First and Personal 
                        Responsibility Act of 1996).''.
    (c) Provision of Data.--Section 17(f)(3) of the National School 
Lunch Act (42 U.S.C. 1766(f)(3)), as amended by subsection (b), is 
further amended by adding at the end the following:
                    ``(E) Provision of data to family or group day care 
                home sponsoring organizations.--
                            ``(i) Census data.--The Secretary shall 
                        provide to each State agency administering a 
                        child and adult care food program under this 
                        section data from the most recent decennial 
                        census survey or other appropriate census 
                        survey for which the data are available showing 
                        which areas in the State meet the requirements 
                        of subparagraph (A)(ii)(I)(aa). The State 
                        agency shall provide the data to family or 
group day care home sponsoring organizations located in the State.
                            ``(ii) School data.--
                                    ``(I) In general.--A State agency 
                                administering the school lunch program 
                                under this Act or the school breakfast 
                                program under the Child Nutrition Act 
                                of 1966 (42 U.S.C. 1771 et seq.) shall 
                                provide data for each elementary school 
                                in the State, or shall direct each 
                                school within the State to provide data 
                                for the school, to approved family or 
                                group day care home sponsoring 
                                organizations that request the data, on 
                                the percentage of enrolled children who 
                                are certified eligible for free or 
                                reduced price meals.
                                    ``(II) Use of data from preceding 
                                school year.--In determining for a 
                                fiscal year or other annual period 
                                whether a home qualifies as a tier I 
                                family or group day care home under 
                                subparagraph (A)(ii)(I), the State 
                                agency administering the program under 
                                this section, and a family or group day 
                                care home sponsoring organization, 
                                shall use the most current available 
                                data at the time of the determination.
                            ``(iii) Duration of determination.--For 
                        purposes of this section, a determination that 
                        a family or group day care home is located in 
                        an area that qualifies the home as a tier I 
                        family or group day care home (as the term is 
                        defined in subparagraph (A)(ii)(I)), shall be 
                        in effect for 3 years (unless the determination 
                        is made on the basis of census data, in which 
                        case the determination shall remain in effect 
                        until more recent census data are available) 
                        unless the State agency determines that the 
                        area in which the home is located no longer 
                        qualifies the home as a tier I family or group 
                        day care home.''.
    (d) Conforming Amendments.--Section 17(c) of the National School 
Lunch Act is amended by inserting ``except as provided in subsection 
(f)(3),'' after ``For purposes of this section,'' each place it appears 
in paragraphs (1), (2), and (3).
    (e) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section become effective on the date of 
        enactment of this subtitle.
            (2) Improved targeting of day care home reimbursements.--
        The amendments made by subsections (a), (c), and (d) become 
        effective on October 1, 1996.

SEC. 392. REIMBURSEMENT RATE ADJUSTMENTS.

    (a) In General.--
            (1) Commodity rate.--Section 6(e)(1)(B) of the National 
        School Lunch Act (42 U.S.C. 1755(e)(1)(B)) is amended by 
        striking ``1/4 cent'' and inserting ``lower cent increment''.
            (2) Lunch, breakfast, and supplement rates.--Section 
        11(a)(3)(B) of the National School Lunch Act (42 U.S.C. 
        1759a(a)(3)(B)) is amended by striking ``one fourth cent'' and 
        inserting ``lower cent increment''.
            (3) Summer program rates.--Section 13(b)(1) of the National 
        School Lunch Act (42 U.S.C. 1761(b)(1)) is amended by striking 
        ``one-fourth cent'' and inserting ``lower cent increment''.
            (4) Special milk program rates.--Section 3(a)(8) of the 
        Child Nutrition Act of 1966 (42 U.S.C. 1772(a)(8)) is amended 
        by striking ``one-fourth cent'' and inserting ``lower cent 
        increment''.
            (5) Reduced price breakfast rates.--Section 4(b)(1)(B) of 
        the Child Nutrition Act of 1966 (42 U.S.C. 1773(b)(1)(B)) is 
        amended by striking ``one fourth cent'' and inserting ``lower 
        cent increment''.
            (6) Severe need rates.--Section 4(b)(2)(B)(ii) of the Child 
        Nutrition Act of 1966 (42 U.S.C. 1773(b)(2)(B)(ii)) is amended 
        by striking ``one-fourth cent'' and inserting ``lower cent 
        increment''.
    (b) Effective Dates.--The amendments made by subsection (a) become 
effective on July 1, 1996.

SEC. 393. ELIMINATION OF START-UP AND EXPANSION GRANTS.--

    (a) Section 4 of the Child Nutrition Act of 1996 (42 U.S.C. 1773) 
is amended by striking subsection (g).
    (b) The amendment made by this subsection (a) becomes effective on 
October 1, 1996.

SEC. 394. AUTHORIZATION OF APPROPRIATIONS.

    Section 19(i) of the Child Nutrition Act (42 U.S.C. 1788(i)) is 
amended--
            (1) in the first sentence of paragraph (2)(A), by striking 
        ``and each succeeding fiscal Year'';
            (2) by redesignating paragraphs (3) and (4) as paragraphs 
        (4) and (5), respectively; and
            (3) by inserting after paragraph (2) the following:
            ``(3) Fiscal years 1997 through 2002.--
                    ``(A) In general.--There are authorized to be 
                appropriated to carry out this section $10,000,000 for 
                each of the fiscal years 1997 through 2002.
                    ``(B) Grants.--
                            ``(i) In general.--Grants to each State 
                        from the amounts made available under 
                        subparagraph (A) shall be based on a rate of 50 
                        cents for each child enrolled in schools or 
                        institutions within the State, except that no 
                        State shall receive an amount less than $75,000 
                        per fiscal year.
                            ``(ii) Insufficient funds.--If an amount 
                        made available for any fiscal year is 
                        insufficient to pay the amount to which each 
                        State is entitled under clause (i), the amount 
                        of each grant, including minimum grants, shall 
                        be ratably reduced.''.

SEC. 395. DIRECT FEDERAL EXPENDITURES.

    (a) Commodity Assistance.--Section 6(g) of the National School 
Lunch Act (42 U.S.C. 1755(g)) is amended by striking ``12 percent'' and 
inserting ``8 percent''.
    (b) The amendment made by this section becomes effective on July 1, 
1996.

                      TITLE D--TREATMENT OF ALIENS

SEC. 401. UNIFORM ALIEN ELIGIBILITY CRITERIA FOR PUBLIC ASSISTANCE 
              PROGRAMS.

    (a) Federal and Federally-Assisted Programs.--
            (1) Program eligibility criteria.--
                    (A) Temporary employment assistance.--Section 
                402(c), as amended by sections 101(a) and 112 of this 
                Act, is further amended by adding at the end the 
                following paragraph:
            ``(9) Restriction of eligibility to citizens and legal 
        immigrants.--The State plan shall provide that, in order to be 
        eligible for assistance under the State plan, an individual 
        must be either--
                    ``(A) a citizen or national of the United States, 
                or
                    ``(B) a qualified alien (as defined in section 
                1145(a)), provided that such alien is not disqualified 
                from receiving assistance under a State plan approved 
                under this part by or pursuant to section 210(f) or 
                245A(h) of the Immigration and Nationality Act or any 
                other provision of law;''.
                    (B) Supplemental security income.--Section 
                1614(a)(1)(B)(i) is amended to read as follows:
                    ``(B)(i) is a resident of the United States, and is 
                either (I) a citizen or national of the United States, 
                or (II) a qualified alien (as defined in section 
                1145(a)), or''.
                    (C) Medicaid.--
                            (i) Section 1903(v)(1) is amended to read 
                        as follows:
    ``(v)(1) Notwithstanding the preceding provisions of this section--
            ``(A) no payment may be made to a State under this section 
        for medical assistance furnished to an individual who is 
        disqualified from receiving such assistance by or pursuant to 
        section 210(f) or 245A(h) of the Immigration and Nationality 
        Act or any other provision of law, and
            ``(B) except as provided in paragraph (2), no such payment 
        may be made for medical assistance furnished to an individual 
        who is not--
                    ``(i) a citizen or national of the United States, 
                or
                    ``(ii) a qualified alien (as defined in section 
                1145(a)).''.
                            (ii) Section 1903(v)(2) is amended--
                                    (I) by striking ``paragraph (1)'' 
                                and inserting ``paragraph (1)(B)''; and
                                    (II) by striking ``alien'' each 
                                place it appears and inserting 
                                ``individual''.
                            (iii) Section 1902(a) is amended in the 
                        last sentence by striking ``alien'' and all 
                        that follows and inserting ``individual who is 
                        not (A) a citizen or national of the United 
                        States, or (B) a qualified alien (as defined in 
                        section 1145(a)) only in accordance with 
                        section 1903(v).''.
                            (iv) Section 1902(b)(3) is amended by 
                        inserting ``or national'' after ``citizen''.
            (2) Definition of ``qualified alien''.--Title XI is amended 
        by adding at the end the following new section:

  ``uniform alien eligibility criteria for public assistance programs

    ``Sec. 1145. (a) Definitions.--For purposes of the programs under 
part A of title IV and titles XVI and XIX of this Act--
            ``(1) Qualified alien.--The term `qualified alien' means an 
        alien--
                    ``(A) who is lawfully admitted for permanent 
                residence within the meaning of section 101(a)(20) of 
                the Immigration and Nationality Act;
                    ``(B) who is admitted as a refugee pursuant to 
                section 207 of such Act;
                    ``(C) who is granted asylum pursuant to section 208 
                of such Act;
                    ``(D) who is a Cuban or Haitian entrant, as defined 
                in section 501(e) of the Refugee Education Assistance 
                Act of 1980 (Public Law 96-422);
                    ``(E) whose deportation is withheld pursuant to 
                section 243(h) of the Immigration and Nationality Act;
                    ``(F) whose deportation is suspended pursuant to 
                section 244 of such Act;
                    ``(G) who is granted conditional entry pursuant to 
                section 203(a)(7) of such Act as in effect prior to 
                April 1, 1980;
                    ``(H) who is lawfully admitted for temporary 
                residence pursuant to section 210 or 245A of such Act;
                    ``(I) who is paroled into the United States under 
                section 212(d)(5) of such Act for a period of at least 
                one year;
                    ``(J) who is within a class of aliens lawfully 
                present within the United States pursuant to any other 
                provision of such Act, provided that--
                            ``(i) the Attorney General determines (and 
                        such determination shall not be judicially 
                        reviewable) that the continued presence of such 
                        class of aliens serves a humanitarian or other 
                        compelling public interest, and
                            ``(ii) the Secretary of Health and Human 
                        Services and the Commissioner of Social 
                        Security determine (and such determination 
                        shall not be judicially reviewable) that such 
                        interest would be further served by treating 
                        each alien within such class as a `qualified 
                        alien' for purposes of this Act; or
                    ``(K) who is the spouse or unmarried child under 21 
                years of age of a citizen of the United States, or the 
                parent of such a citizen if the citizen is 21 years of 
                age or older, and with respect to whom an application 
for adjustment to lawful permanent residence is pending;
        such status not having changed.
            ``(2) Sponsor.--The term `sponsor' means, with respect to a 
        qualified alien, an individual who--
                    ``(A) is a citizen or national of the United States 
                or an alien who is lawfully admitted to the United 
                States for permanent residence;
                    ``(B) is 18 years of age or over;
                    ``(C) is domiciled in any State, the District of 
                Columbia, or any territory or possession of the United 
                States; and
                    ``(D) has executed an affidavit of support for such 
                alien in accordance with section 213 of the Immigration 
                and Nationality Act.''.
            (3) Conforming amendment.--Section 244A(f)(1) of the 
        Immigration and Nationality Act is amended by inserting ``and 
        shall not be considered to be a `qualified alien' within the 
        meaning of section 1145(a) of the Social Security Act'' 
        immediately before the semicolon.
    (b) State and Local Programs.--A State, or a political subdivision 
of a State, may provide that an alien is not eligible for any program 
of cash assistance (other than assistance related to pre-school, 
elementary, or secondary education) or medical assistance (other than 
emergency medical assistance) based on need that is furnished by such 
State or political subdivision unless such alien is a ``qualified 
alien'' within the meaning of section 1145(a) of the Social Security 
Act (as added by subsection (a)(2) of this section).
    (c) Effective Date.--The amendments made by this section are 
effective with respect to benefits furnished on the basis of any 
application filed after the date of enactment of this Act.

SEC. 402. DEEMING OF SPONSOR'S INCOME AND RESOURCES TO ALIEN UNDER TEA, 
              SSI, AND FOOD STAMP PROGRAMS.

    (a) Extension of Deeming Period to Date of Naturalized 
Citizenship.--Section 1145 of the Social Security Act, as added by 
section 401 of this Act, is amended by adding at the end the following 
new subsection:
    ``(b) Deeming of Income to Sponsored Alien Until Naturalization for 
Purposes of Certain Assistance Programs.--
            ``(1) In general.--Except as otherwise provided in this 
        subsection, for purposes of the programs under titles IV-A and 
        XVI and the program under the Food Stamp Act of 1977, the 
        income and resources of the sponsor of a qualified alien, and 
        of the sponsor's spouse, shall be deemed to be available to 
        such alien, in accordance with the applicable provisions of 
        each such program, until the date on which the alien achieves 
        United States citizenship through naturalization pursuant to 
        the Immigration and Nationality Act.
            ``(2) Exceptions.--The income and resources of a sponsor 
        shall not be deemed available to a qualified alien in the 
        following circumstances:
                    ``(A) Elderly alien after 5 years' residence.--The 
                alien has been lawfully admitted to the United States 
                for permanent residence, has attained 75 years of age, 
                and has resided in the United States for at least 5 
                years.
                    ``(B) Alien a veteran.--The alien--
                            ``(i) is a veteran (as defined in section 
                        101 of title 38, United States Code) with a 
                        discharge characterized as an honorable 
                        discharge,
                            ``(ii) is on active duty (other than active 
                        duty for training) in the Armed Forces of the 
                        United States, or
                            ``(iii) is the spouse (other than a 
                        divorced spouse), surviving spouse, or 
                        unmarried minor dependent child of an 
                        individual described in clause (i) or (ii).
                    ``(C) Alien a taxpayer.--
                            ``(i) Taxes have been paid (as determined 
                        in accordance with clause (ii)) under chapter 2 
                        or chapter 21 of the Internal Revenue Code of 
                        1986 for each of 20 different calendar quarters 
                        with respect to the self-employment income or 
                        employment of the alien, or spouse of the 
                        alien, or parent of the alien (in the case of 
                        an alien under age 25).
                            ``(ii) For purposes of clause (i), the 
                        taxes described in such clause shall, in the 
                        absence of any evidence to the contrary, be 
                        assumed to have been paid with respect to any 
                        wages and self-employment income for which such 
                        alien, parent, or spouse has been credited in 
                        the records maintained by the Commissioner of 
                        Social Security for purposes of the 
                        administration of the Federal Old-Age, 
                        Survivors, and Disability Insurance program 
                        authorized by title II of this Act.
                            ``(iii) The Social Security Administration, 
                        by regulation, shall provide a simplified 
                        method for assigning an individual's annual 
                        earnings in a year to a given calendar quarter. 
                        Earnings assigned to a given calendar quarter 
                        are considered to be acquired as of the first 
                        day of that quarter.
                    ``(D) Alien whose sponsor receives tea or ssi 
                benefits.--The provisions of paragraph (1) shall not 
                apply to any alien for any month for which such alien's 
                sponsor receives any of the following benefits--
                            ``(i) temporary employment assistance under 
                        part A of title IV;
                            ``(ii) supplemental security income under 
                        title XVI; or
                            ``(iii) federally administered State 
                        supplementary payments pursuant to section 
                        1616(a) of this Act or to section 212(b) of 
                        Public Law 93-66.
                    ``(E) Food stamps exemption for blind or disabled 
                alien.--The provisions of paragraph (1) shall not apply 
                to the program under the Food Stamp Act of 1977 with 
                respect to an alien for any month for which such alien 
                receives supplemental security income under title XVI 
                by reason of blindness (as determined under section 
                1614(a)(2)) or disability (as determined under section 
                1614(a)(3)), provided that such blindness or disability 
                commenced after the date of such individual's admission 
                into the United States for permanent residence.
            ``(3) Regulations providing for hardship exceptions.--The 
        Secretary of Health and Human Services, the Commissioner of 
        Social Security, and the Secretary of Agriculture, after 
        consultation together, may each promulgate regulations 
        providing for alteration or suspension of the application of 
        paragraph (1) in cases (including cases in which the sponsored 
        alien is the subject of domestic violence or other abuse by the 
        sponsor) where such application to a qualified alien, for 
        purposes of determining eligibility for a program administered 
        by such official, would be inequitable in the circumstances.
            ``(4) Inapplicability to medicaid.--The provisions of 
        paragraph (1) shall be inapplicable to the determination of the 
        eligibility of a qualified alien for benefits under title 
        XIX.''.
    (b) Amendments to Program Statutes.--
            (1) Temporary employment assistance.--Section 415 of the 
        Social Security Act is redesignated as section 407, and is 
        amended--
                    (A) in subsection (a)--
                            (i) by striking ``an alien described in 
                        clause (B) of section 402(a)(33)'' and 
                        inserting ``a qualified alien (as defined in 
                        section 1145(a))''; and
                            (ii) by striking ``for a period of three 
                        years after the individual's entry into the 
                        United States'' and inserting ``, subject to 
                        the exceptions in subsection (f), during the 
                        period (if any) determined pursuant to section 
                        1145(b) with respect to such alien'';
                    (B) in subsection (b)--
                            (i) in paragraph (1)(B)(ii), by striking 
                        ``section 402(a)(7)'' and inserting ``section 
                        402(d)'';
                            (ii) in paragraph (2)(A), by striking 
                        ``aid'' and inserting ``assistance''; and
                            (iii) in paragraph (2)(B), by striking 
                        ``$1,500'' and inserting ``$2,000''; and
                    (C) in subsection (c)(1), in the first and second 
                sentences, and in subsection (d)--
                            (i) by striking ``aid'' each place it 
                        appears and inserting ``assistance''; and
                            (ii) by striking ``during the period of 
                        three years after his or her entry into the 
                        United States'' and inserting ``during the 
                        period (if any) determined pursuant to section 
                        1145(b) with respect to such alien''.
            (2) Supplemental security income.--
                    (A) Section 1621(a) of the Social Security Act is 
                amended by striking ``for a period of 5 years after the 
                individual's entry into the United States'' and 
                inserting ``during the period (if any) determined 
                pursuant to section 1145(b) with respect to such 
                alien''.
                    (B) Section 1621(c) of the Social Security Act is 
                amended by striking ``during the period of 5 years 
                after such alien's entry into the United States'' and 
                inserting ``during the period (if any) determined 
                pursuant to section 1145 with respect to such alien''.
                    (C) Section 1621(d) of the Social Security Act is 
                amended by striking ``during the period of 5 years 
                after entry into the United States'' and inserting 
                ``during the period (if any) determined pursuant to 
                section 1145(b) with respect to such alien''.
                    (D) Section 1621(e) of the Social Security Act is 
                amended by striking ``during the period of 5 years 
                after such alien's entry into the United States'' and 
                inserting ``during the period (if any) determined 
                pursuant to section 1145(b) with respect to such 
                alien''.
            (3) Food stamps.--Section 5(i) of the Food Stamp Act of 
        1977 is amended--
                    (A) in paragraph (1), by striking ``for a period of 
                three years after the individual's entry into the 
                United States'' and inserting ``for the period (if any) 
                determined pursuant to section 1145(b) of the Social 
                Security Act with respect to such alien'';
                    (B) in paragraph (2)(B)(ii), by striking ``$1,500'' 
                and inserting ``$2,000'';
                    (C) in paragraph (2)(C), by striking ``during the 
                period of three years after entry into the United 
                States'' and inserting ``during the period (if any) 
                determined pursuant to section 1145(b) of the Social 
                Security Act with respect to such alien''; and
                    (D) in paragraph (2)(D), by striking ``during the 
                period of three years after such alien's entry into the 
                United States'' and inserting ``during the period (if 
                any) determined pursuant to section 1145(b) of the 
                Social Security Act with respect to such alien''.
    (c) State and Local Programs.--A State, or a political subdivision 
of a State, may provide that an alien is not eligible for any program 
of cash assistance (other than assistance related to pre-school, 
elementary, or secondary education) based on need that is furnished by 
such State or political subdivision for any month if such alien has 
been determined to be ineligible for such month for benefits under--
            (1) the program of temporary employment assistance under 
        part A of title IV of the Social Security Act, as a result of 
        the application of section 407 of such Act;
            (2) the program of supplemental security income under title 
        XVI of the Social Security Act, as a result of the application 
        of section 1611(e)(4) or 1621 of such Act; or
            (3) the Food Stamp Act of 1977, as a result of the 
        application of section 5(i) or 6(i) of such Act.
    (d) Effective Date.--
            (1) The amendments made by this section are effective with 
        respect to benefits under the program of temporary employment 
        assistance authorized by part A of title IV of the Social 
        Security Act, the program of supplemental security income 
        authorized by title XVI of the Social Security Act, and the 
        program authorized by the Food Stamp Act of 1977, payable for 
        months beginning on or after the date 60 days after enactment 
        of this Act, on the basis of--
                    (A) an application filed after such date, or
                    (B) an application filed on or before such date by 
                or on behalf of an individual subject to the provisions 
                of section 1621(a) or section 415 (which is renumbered 
                as section 407 by subsection (b) of this section and 
                section 102 of this Act, effective as of October 1, 
                1996) of the Social Security Act or section 5(i)(1) of 
                the Food Stamp Act of 1977 (as the case may be) on such 
                date.

SEC. 403. CONTINUED LIABILITY OF ALIEN AND SPONSOR FOR OVERPAYMENTS.

    (a) Temporary Employment Assistance.--Section 407(d) (as 
redesignated and amended by section 402(b) of this Act) is amended by 
adding at the end the following sentence: ``If an individual who is an 
alien subject to this subsection is naturalized as a citizen of the 
United States, such naturalization shall have no effect upon the 
continued application of this subsection to such individual or to such 
individual's sponsor.''.
    (b) Supplemental Security Income.--Section 1621(e) is amended by 
adding at the end the following sentence: ``If an individual who is an 
alien subject to this subsection is naturalized as a citizen of the 
United States, such naturalization shall have no effect upon the 
continued application of this subsection to such individual or to such 
individual's sponsor.''.
    (c) Food Stamps.--Section 5(i)(2)(D) of the Food Stamp Act of 1977 
is amended by adding at the end the following sentence: ``If an 
individual who is an alien subject to this subsection is naturalized as 
a citizen of the United States, such naturalization shall have no 
effect upon the continued application of this subsection to such 
individual or to such individual's sponsor.''.

SEC. 404. REQUIREMENTS FOR SPONSOR'S AFFIDAVIT OF SUPPORT.

    (a) Sponsor's Affidavit of Support.--Section 213 of the Immigration 
and Nationality Act (8 U.S.C. 1183) is amended--
            (1) in the heading, by striking ``ON GIVING BOND'' and 
        inserting ``UPON PROVISION OF BOND OR GUARANTEE OF FINANCIAL 
        RESPONSIBILITY'';
            (2) by designating the existing matter as subsection (a); 
        and
            (3) by adding at the end a new subsection as follows:
    ``(b)(1) Attorney General's Discretion To Admit Alien.--An alien 
excludable under paragraph (4) of section 212(a) may, if otherwise 
admissible, be admitted in the discretion of the Attorney General upon 
a finding by the Attorney General that--
            ``(A) the alien has received a guarantee of financial 
        responsibility in such form as may be prescribed pursuant to 
        paragraph (4) and meeting the conditions described in paragraph 
        (2); and
            ``(B) taking into consideration all relevant circumstances, 
        it is reasonable to expect that the sponsor has the financial 
        capacity to meet the obligations of the guarantee.''
    ``(2) Substance of guarantee of support.--A guarantee of financial 
responsibility for an alien must--
            ``(A) be signed in the presence of an immigration officer 
        or consular officer (or in the presence of a notary public) by 
        an individual (referred to in this subsection as the `sponsor') 
        who is 18 years of age or older, is of good moral character, 
        and is a citizen or national of the United States or an alien 
        lawfully admitted for permanent residence domiciled in any of 
        the several States of the United States, the District of 
        Columbia, or any territory or possession of the United States; 
        and
            ``(B) provide that the sponsor enters into a legally 
        binding commitment to furnish to or on behalf of the alien 
        financial support sufficient to meet the alien's basic 
        subsistence needs until the alien achieves United States 
        citizenship through naturalization pursuant to the Immigration 
        and Nationality Act.
    ``(3) Enforceability of guarantee of support.--Any guarantee of 
financial support executed on behalf of an alien pursuant to this 
subsection must be enforceable against the sponsor and may be enforced 
against the sponsor in a civil suit brought by the sponsored alien or 
by the Federal Government, any State, district, territory, or 
possession of the United States (or any subdivision of such State, 
district, territory, or possession of the United States) which provides 
benefits to the alien in any court of competent jurisdiction, except 
that no action may be brought against a sponsor if the sponsor is 
receiving cash or food stamp benefits (as defined in paragraph (7)).
    ``(4) Form of guarantee of support.--Not later than 90 days after 
the date of enactment of this section, the Secretary of State, the 
Attorney General, the Secretary of Health and Human Services, the 
Secretary of Agriculture, and the Commissioner of Social Security shall 
jointly establish the form of the guarantee of financial support 
described in this section.
    ``(5) Limitation of liability.--The guarantee of financial support 
established pursuant to this section shall only apply with respect to 
cash or food stamp benefits (as defined in paragraph (7)) provided to 
an alien before the earliest of the following:
            ``(A) Citizenship.--The date the alien becomes a citizen of 
        the United States.
            ``(B) Veteran.--The first date the alien is described in 
        section 1145(b)(2)(B) of the Social Security Act.
            ``(C) Payment of social security taxes.--The first date as 
        of which the condition described in section 1145(b)(2)(C) of 
the Social Security Act is met with respect to the alien.
            ``(D) Elderly alien.--The first date the alien is described 
        in section 1145(b)(2)(A) of the Social Security Act.
    ``(6) Nonapplication during certain periods.--The contract 
established by this section shall not apply with respect to cash or 
food stamp benefits (as defined in paragraph (7)) provided to an alien 
during any period in which the sponsor is receiving such benefits.
    ``(7) Definition of cash or food stamp benefits.--For the purposes 
of this section the term `cash or food stamp benefits' means Federal 
assistance provided under title IV-A or XVI of the Social Security Act, 
under the Food Stamp Act of 1977, or under similar programs of a State 
or a political subdivision of a State that provides direct cash (or 
cash equivalent) assistance for the purpose of income maintenance and 
in which the eligibility of an individual, household, or family unit 
for such benefits under the program, or the amount of such benefits, or 
both, are determined on the basis of income, resources, or financial 
need of the individual, household, or unit. Such term does not include 
any program insofar as it provides medical, housing, education, job 
training, food, or in-kind assistance or social services.''.
    (b) Effective Date.--The amendments made by this section apply to 
affidavits of support executed on or after the date 90 days after the 
date of establishment of the form for such affidavits under section 
213(b)(4) of the Immigration and Nationality Act, as added by this 
section.

             TITLE V--SUPPLEMENTAL SECURITY INCOME REFORMS

SEC. 501. DEFINITION AND ELIGIBILITY RULES.

    (a) Definition of Childhood Disability.--Section 1614(a)(3) (42 
U.S.C. 1382c(a)(3)) is amended--
            (1) in subparagraph (A), by striking ``An individual'' and 
        inserting ``Except as provided in subparagraph (C), an 
        individual'';
            (2) in subparagraph (A), by striking ``(or, in the case of 
        an individual under the age of 18, if he suffers from any 
        medically determinable physical or mental impairment of 
        comparable severity)'';
            (3) by redesignating subparagraphs (C) through (H) as 
        subparagraphs (D) through (I), respectively;
            (4) by inserting after subparagraph (B) the following new 
        subparagraph:
                    ``(C) An individual under the age of 18 shall be 
                considered disabled for the purposes of this title if 
                that individual has a medically determinable physical 
                or mental impairment, which results in marked and 
                severe functional limitations, and which can be 
                expected to result in death or which has lasted or can 
                be expected to last for a continuous period of not less 
                than 12 months. Notwithstanding the preceding sentence, 
                no individual under the age of 18 who engages in 
                substantial gainful activity (determined in accordance 
                with regulations prescribed pursuant to subparagraph 
                (E)) may be considered to be disabled.''; and
            (5) in subparagraph (F), as so redesignated by paragraph 
        (3) of this subsection, by striking ``(D)'' and inserting 
        ``(E)''.
    (b) Changes Respecting Childhood SSI Regulations.--
            (1) Modification to medical criteria for evaluation of 
        mental and emotional disorders.--The Commissioner of Social 
        Security shall modify sections 112.00C.2. and 112.02B.2.c.(2) 
        of appendix 1 to subpart P of part 404 of title 20, Code of 
        Federal Regulations, to eliminate references to maladaptive 
        behavior in the domain of personal/behavioral function.
            (2) Discontinuance of individualized functional 
        assessment.--The Commissioner of Social Security shall 
        discontinue the individualized functional assessment for 
        children set forth in sections 416.924d and 416.924e of title 
        20, Code of Federal Regulations.
    (c) Conforming Amendment to Medical Improvement Review Standard as 
it Applies to Individuals Under the Age of 18.--
            (1) In general.--Section 1614(a)(4) (42 U.S.C. 1382c(a)(4)) 
        is amended--
                    (A) by redesignating subclauses (I) and (II) of 
                clauses (i) and (ii) of subparagraph (B) as subclauses 
                (aa) and (bb), respectively;
                    (B) by redesignating clauses (i) and (ii) of 
                subparagraphs (A) and (B) as subclauses (I) and (II), 
                respectively;
                    (C) by redesignating subparagraphs (A) through (D) 
                as clauses (i) through (iv), respectively, and by 
                moving their left hand margin 2 ems to the right;
                    (D) by inserting before clause (i) (as redesignated 
                by subparagraph (C)) the following:
                    ``(A) in the case of an individual who is age 18 or 
                older--'';
                    (E) at the end of subparagraph (A)(iv) (as 
                redesignated by subparagraphs (C) and (D)), by striking 
                the period and inserting ``; or'';
                    (F) by inserting after and below subparagraph 
                (A)(iv) (as so redesignated) the following:
                    ``(B) in the case of an individual who is under the 
                age of 18--
                            ``(i) substantial evidence which 
                        demonstrates that there has been any medical 
                        improvement in the individual's impairment or 
                        combination of impairments, and that such 
                        impairment or combination of impairments no 
                        longer results in marked and severe functional 
                        limitations; or
                            ``(ii) substantial evidence which 
                        demonstrates that, as determined on the basis 
                        of new or improved diagnostic techniques or 
                        evaluations, the individual's impairment or 
                        combination of impairments is not as disabling 
                        as it was considered to be at the time of the 
                        most recent prior decision that he or she was 
under a disability or continued to be under a disability, and such 
impairment or combination of impairments does not result in marked and 
severe functional limitations; or
                            ``(iii) substantial evidence (which may be 
                        evidence on the record at the time any prior 
                        determination of eligibility for benefits based 
                        on disability was made, or newly obtained 
                        evidence which relates to that determination) 
                        which demonstrates that a prior determination 
                        was in error.''; and
                    (G) in the first sentence following subparagraph 
                (B) (as added by subparagraph (F)), by--
                            (i) inserting ``(i)'' before ``to 
                        restore''; and
                            (ii) inserting ``, or
                            (ii) in the case of an individual under the 
                        age of 18, to eliminate or improve the 
                        individual's impairment or combination of 
                        impairments so that it no longer results in 
                        marked and severe functional limitations'' 
                        before the period.
            (2) Effective Date.--The amendments made by this subsection 
        are effective upon enactment.
    (d) Effective Date; Regulations; Application to Current 
Recipients.--
            (1) In general.--Except where otherwise specified, 
        subsections (a) and (b) apply to applications filed on or after 
        the date of the enactment of this Act, without regard to 
        whether implementing regulations have been issued.
            (2) Regulations.--The Commissioner of Social Security shall 
        issue regulations implementing subsections (a), (b), and (c).
            (3) Application to current recipients.--
                    (A) Eligibility determinations.--Beginning on 
                January 1, 1997, and ending not later than January 1, 
                1998, the Commissioner of Social Security shall 
                redetermine the eligibility of any individual under age 
                18 who is eligible for supplemental security income 
                benefits based on a disability under title XVI of the 
                Social Security Act as of the date of the enactment of 
                this Act and whose eligibility for such benefits may 
                terminate by reason of subsections (a) or (b) of this 
                section. With respect to any redetermination under this 
                subparagraph--
                            (i) section 1614(a)(4) of the Social 
                        Security Act (42 U.S.C. 1382c(a)(4)) shall not 
                        apply;
                            (ii) the Commissioner of Social Security 
                        shall apply the eligibility criteria for new 
                        applicants for benefits under title XVI of such 
                        Act ;
                            (iii) the Commissioner shall give such 
                        redetermination priority over all continuing 
                        eligibility reviews and other reviews under 
                        such title; and
                            (iv) such redetermination shall be counted 
                        as a review or redetermination otherwise 
                        required to be made under section 208 of the 
                        Social Security Independence and Program 
                        Improvements Act of 1994 or any other provision 
                        of title XVI of the Social Security Act.
                    (B) Grandfather provision.--Subsections (a) and (b) 
                of this section and the redetermination under 
                subparagraph (A) of this paragraph only apply with 
                respect to the benefits of an individual described in 
                subparagraph (A) for months beginning on or after 
                January 1, 1998.
                    (C) Notice.--Not later than January 1, 1997, the 
                Commissioner of Social Security shall notify an 
                individual described in subparagraph (A) of the 
                provisions of this paragraph.

SEC. 502. ELIGIBILITY REDETERMINATIONS AND CONTINUING DISABILITY 
              REVIEWS.

    (a) Continuing Disability Reviews Relating to Certain Children.--
Section 1614(a)(3)(H) (42 U.S.C. 1382c(a)(3)(H)), as so redesignated by 
section 501(a)(3) of this Act, is amended--
            (1) by inserting ``(i)'' after ``(H)''; and
            (2) by adding at the end the following new clause:
                            ``(ii)(I) Not less frequently than once 
                        every 3 years, the Commissioner shall review in 
                        accordance with paragraph (4) the continued 
                        eligibility for benefits under this title of 
                        each individual who has not attained 18 years 
                        of age and is eligible for such benefits by 
                        reason of an impairment (or combination of 
                        impairments) which may improve (or, which is 
                        unlikely to improve, at the option of the 
                        Commissioner).
                            ``(II) A parent or guardian of a recipient 
                        whose case is reviewed under this clause shall 
                        present, at the time of review, evidence 
                        demonstrating that the recipient is, and has 
                        been, receiving treatment, to the extent 
                        considered medically necessary and available, 
                        of the condition which was the basis for 
                        providing benefits under this title.''.
    (b) Disability Eligibility Redeterminations Required for SSI 
Recipients Who Attain 18 Years of Age.--
            (1) In general.--Section 1614(a)(3)(H) (42 U.S.C. 
        1382c(a)(3)(H)), as so redesignated by section 501(a)(3) of 
        this Act and as amended by subsection (a) of this section, is 
        amended by adding at the end the following new clause:
                            ``(iii) If an individual is eligible for 
                        benefits under this title by reason of 
                        disability for the month preceding the month in 
                        which the individual attains the age of 18 
                        years, the Commissioner shall redetermine such 
                        eligibility--
                                    ``(I) during the 1-year period 
                                beginning on the individual's 18th 
                                birthday; and
                                    ``(II) by applying the criteria 
                                used in determining the initial 
                                eligibility for applicants who have 
                                attained the age of 18 years.
                        With respect to a redetermination under this 
                        clause, paragraph (4) shall not apply and such 
                        redetermination shall be considered a 
                        substitute for a review or redetermination 
                        otherwise required under any other provision of 
this subparagraph during that 1-year period.''.
            (2) Conforming repeal.--Section 207 of the Social Security 
        Independence and Program Improvements Act of 1994 (42 U.S.C. 
        1382 note; 108 Stat. 1516) is repealed.
    (c) Continuing Disability Review Required for Low Birth Weight 
Babies.--Section 1614(a)(3)(H) (42 U.S.C. 1382c(a)(3)(H)), as so 
redesignated by section 501(a)(3) of this Act and as amended by 
subsections (a) and (b) of this section, is amended by adding at the 
end the following new clause:
                            ``(iv)(I) Not later than 12 months after 
                        the first month of eligibility based on an 
                        application of an individual for benefits under 
                        this title, the Commissioner shall review in 
                        accordance with paragraph (4) the continuing 
                        eligibility for benefits by reason of 
                        disability of such individual whose low birth 
                        weight is a contributing factor material to the 
                        Commissioner's determination that the 
                        individual is disabled.
                            ``(II) A review under subclause (I) shall 
                        be considered a substitute for a review 
                        otherwise required under any other provision of 
                        this subparagraph during that 12-month period.
                            ``(III) A parent or guardian of a recipient 
                        whose case is reviewed under this clause shall 
                        present, at the time of review, evidence 
                        demonstrating that the recipient is, and has 
                        been, receiving treatment, to the extent 
                        considered medically necessary and available, 
                        for the condition which was the basis for 
                        providing benefits under this title.''.
    (d) Effective Date.--The amendments made by this section apply to 
benefits for months beginning on or after the date of the enactment of 
this Act, without regard to whether regulations have been issued to 
implement such amendments.

SEC. 503. DEDICATED SAVINGS ACCOUNTS.

    (a) In General.--Section 1631(a)(2)(B) (42 U.S.C. 1383(a)(2)(B)) is 
amended by adding at the end the following:
                            ``(xiv) A representative payee may pay any 
                        lump sum payment equal to or greater than 6 
                        times the Federal benefit rate for the benefit 
                        of a child into a dedicated savings account 
                        that must only be used to purchase for such 
                        child, or an individual for whom such an 
                        account was established prior to his attainment 
                        of age 18,--
                                    ``(I) education and job skills 
                                training;
                                    ``(II) special equipment or housing 
                                modifications or both specifically 
                                related to, and required by the nature 
                                of, the child's disability; and
                                    ``(III) appropriate therapy and 
                                rehabilitation.''.
    (b) Exclusion of Dedicated Savings Accounts.--
            (1) Section 1613(a) (42 U.S.C. 1382b(a)) is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (10),
                    (B) by striking the period at the end of paragraph 
                (11) and inserting ``; and'', and
                    (C) by inserting after paragraph (11) the 
                following:
            ``(12) the initial and any subsequent lump sum payment 
        deposited in, or interest credited to, a dedicated savings 
        account described in section 1631(a)(2)(B)(xiv), so long as 
        such monies are being used for a purpose listed in that 
        section.''.
            (2) Section 1612(b) (42 U.S.C. 1382a(b)) is amended:
                    (A) by striking ``and'' at the end of paragraph 
                (19),
                    (B) by striking the period at the end of paragraph 
                (20) and inserting thereafter ``and,'', and
                    (C) by inserting after paragraph (20) the following 
                new paragraph:
            ``(21) interest earned on a dedicated savings account as 
        described in section 1631(a)(2)(B)(xiv) so long as monies in 
        such account are used for a purpose listed in such section.''.
    (c) Penalties for Misuse of Funds.--Knowing and willful use of 
funds in a dedicated savings account by the representative payee for 
any purpose other than those listed in subsection (a) constitutes fraud 
and is subject to penalties under section 1632.
    (d) Effective Date.--The amendments made by this section apply to 
payments made after the date of enactment of this Act.

SEC. 504. DENIAL OF SSI BENEFITS BY REASON OF DISABILITY TO DRUG 
              ADDICTS AND ALCOHOLICS.

    (a) In General.--Section 1614(a)(3) (42 U.S.C. 1382c(a)(3)), as 
amended by section 501(a)(3) of this Act, is amended by adding at the 
end the following:
                    ``(J) Notwithstanding subparagraph (A), an 
                individual shall not be considered to be disabled for 
                purposes of this title if alcoholism or drug addiction 
                would (but for this subparagraph) be a contributing 
                factor material to the Commissioner's determination 
                that the individual is disabled.''.
    (b) Conforming Amendments.--
            (1) Section 1611(e) (42 U.S.C. 1382(e)) is amended by 
        striking paragraph (3).
            (2) Section 1631(a)(2)(A)(ii) (42 U.S.C. 1383(a)(2)(A)(ii)) 
        is amended--
                    (A) by striking ``(I)''; and
                    (B) by striking subclause (II).
            (3) Section 1631(a)(2)(B) (42 U.S.C. 1383(a)(2)(B)) is 
        amended--
                    (A) by striking clause (vii);
                    (B) in clause (viii), by striking ``(ix)'' and 
                inserting ``(viii)'';
                    (C) in clause (ix)--
                            (i) in subclause (I), by striking 
                        ``(viii)'' and inserting ``(vii)''; and
                            (ii) in subclause (II),
                                    (I) by striking the comma after 
                                ``incompetent'' and inserting ``or''; 
                                and
                                    (II) by striking all that follows 
                                ``15 years'' and inserting a period;
                    (D) in clause (xiii)--
                            (i) by striking ``(xii)'' and inserting 
                        ``(xi)''; and
                            (ii) by striking ``(xi)'' and inserting 
                        ``(x)''; and
                    (E) by redesignating clauses (viii) through (xiv) 
                as clauses (vii) through (xiii), respectively.
            (4) Section 1631(a)(2)(D)(i)(II) (42 U.S.C. 
        1383(a)(2)(D)(i)(II)) is amended by striking all that follows 
        ``$25.00 per month'' and inserting a period.
            (5) Section 1634 (42 U.S.C. 1383c) is amended by striking 
        subsection (e).
            (6) Section 201(c)(1) of the Social Security Independence 
        and Program Improvements Act of 1994 (42 U.S.C. 425 note) is 
        amended--
                    (A) by striking ``--'' and all that follows through 
                ``(A)'' the 1st place such term appears;
                    (B) by striking ``and'' the 3rd place such term 
                appears;
                    (C) by striking subparagraph (B);
                    (D) by striking ``either subparagraph (A) or 
                subparagraph (B)'' and inserting ``the preceding 
                sentence''; and
                    (E) by striking ``subparagraph (A) or (B)'' and 
                inserting ``the preceding sentence''.
    (c) Effective Date.--
            (1) The amendments made by this section apply to 
        applications filed on or after the date of the enactment of 
        this Act, without regard to whether regulations have been 
        issued to implement such amendments.
            (2) Application and notice to current recipients.--
        Notwithstanding any other provision of law, in the case of an 
        individual who is eligible for supplemental security income 
        benefits under title XVI of the Social Security Act as of the 
        date of the enactment of this Act and whose eligibility for 
        such benefits would terminate by reason of the amendments made 
        by this section, such amendments shall apply with respect to 
        the benefits of such individual for months beginning on or 
        after January 1, 1997, and the Commissioner of Social Security 
        shall so notify the individual not later than 90 days after the 
        date of the enactment of this Act. As used in the preceding 
        sentence, the phrase ``supplemental security income benefits 
        under title XVI'' includes supplementary payments pursuant to 
        an agreement for Federal administration under section 1616(a) 
        of the Social Security Act and payments pursuant to an 
        agreement for Federal administration under section 212(b) of 
        Public Law 93-66.
    (d) Supplemental Funding for Alcohol and Substance Abuse Treatment 
Programs.--
            (1) In general.--Out of any money in the Treasury not 
        otherwise appropriated, there are hereby appropriated to 
        supplement State and Tribal programs funded under section 1933 
        of the Public Health Service Act (42 U.S.C. 300x-33), 
        $50,000,000 for each of the fiscal years 1997 and 1998.
            (2) Additional funds.--Amounts appropriated under paragraph 
        (1) shall be in addition to any funds otherwise appropriated 
        for allotments under section 1933 of the Public Health Service 
        Act (42 U.S.C. 300x-33) and shall be allocated pursuant to that 
        section.
            (3) Use of funds.--A State or Tribal government receiving 
        an allotment under this subsection shall consider as 
        priorities, for purposes of expending funds allotted under this 
        subsection, activities relating to the treatment of the abuse 
        of alcohol and other drugs.

SEC. 505. DENIAL OF SSI BENEFITS FOR 10 YEARS TO INDIVIDUALS FOUND TO 
              HAVE FRAUDULENTLY MISREPRESENTED RESIDENCE IN ORDER TO 
              OBTAIN BENEFITS SIMULTANEOUSLY IN 2 OR MORE STATES.

    Section 1632 (42 U.S.C. 1383a) is amended by adding at the end the 
following:
    ``(c)(1) If any individual is convicted of fraudulently 
misrepresenting residence in order to obtain benefits simultaneously in 
two or more States, then the court may, in addition to all other 
penalties provided by law, impose a penalty that an individual shall 
not be considered an eligible individual for purposes of this title 
during the 10-year period beginning on the date the individual is found 
by a State to have made, or is convicted in Federal or State court of 
having made, a fraudulent statement or representation with respect to 
the place of residence of the individual in order to receive benefits 
simultaneously from 2 or more States under programs that are funded 
under part A of title IV, or title XIX of this Act, the consolidated 
program of food assistance under title III of the Work First and 
Personal Responsibility Act of 1996, or the Food Stamp Act of 1977 (as 
in effect before the effective date of title III of the Work First and 
Personal Responsibility Act of 1996), or benefits in 2 or more States 
under the supplemental security income program under title XVI of this 
Act.
    ``(2) As soon as practicable after an additional penalty has, 
pursuant to paragraph (1), been imposed with respect to any individual, 
an official of a court making such imposition shall notify the 
Commissioner of such imposition.
    ``(3) If any individual with respect to whom an additional penalty 
has been imposed pursuant to paragraph (1) is granted a pardon by the 
President of the United States, such additional penalty shall not apply 
for any month beginning after the date on which such pardon was 
granted.''.

SEC. 506. DENIAL OF SSI BENEFITS FOR FUGITIVE FELONS AND PROBATION AND 
              PAROLE VIOLATORS.

    (a) In General.--Section 1611(e) (42 U.S.C. 1382(e)), as amended by 
section 504(b)(1) of this Act, is amended by inserting after paragraph 
(2) the following:
            ``(3) A court of law may, in addition to all other 
        penalties provided by law, impose on the individual 
        ineligibility for benefits under this title with respect to any 
        month if, throughout the month, the person is--
                    ``(A) fleeing custody or confinement after 
                conviction, under the laws of the place from which the 
                person flees, for a crime which is a felony under the 
                laws of the place from which the person flees, or 
                which, in the case of the State of New Jersey, is a 
                high misdemeanor under the laws of such State; or
                    ``(B) violating a condition of probation or parole 
                imposed under Federal or State law.
            ``(4) As soon as practicable after the additional penalty 
        has been imposed pursuant to paragraph (3) with respect to any 
        individual, an official of the court making such imposition 
        shall notify the Commissioner of such imposition.''.
    (b) Exchange of Information With Law Enforcement Agencies.--Section 
1631(e) (42 U.S.C. 1383(e)) is amended by inserting after paragraph (3) 
the following:
            ``(4) Notwithstanding any other provision of law (other 
        than section 6103 of the Internal Revenue Code of 1986), the 
        Commissioner shall furnish any Federal, State, or local law 
        enforcement agency, upon the written request of the head of the 
        agency, with the current address of any recipient of benefits 
        under this title, if the agency furnishes the Commissioner with 
        the name of the recipient, and other identifying information as 
        required by the Commissioner reasonably to establish the unique 
        identity of the recipient, and a statement from a court of 
        competent jurisdiction and notifies the Commissioner that the 
        recipient--
                    ``(A) has been found by a court of competent 
                jurisdiction to be fleeing to avoid prosecution, or 
                custody or confinement after conviction, under the laws 
                of the place from which the person flees, for a crime, 
                or an attempt to commit a crime, which is a felony 
                under the laws of the place from which the person 
                flees, or which, in the case of the State of New 
                Jersey, is a high misdemeanor under the laws of such 
                State; or
                    ``(B) has been found by a court of competent 
                jurisdiction to be violating a condition of probation 
                or parole imposed for a crime as in (A) above under 
                Federal or State law.''.

SEC. 507. ALLOWANCE UNDER THE DISCRETIONARY SPENDING LIMITS FOR 
              INCREASED EXPENDITURES FOR CONTINUING DISABILITY REVIEWS 
              AND DISABILITY ELIGIBILITY REDETERMINATIONS.

    (a) Section 251(b)(2) of the Balanced Budget and Emergency Deficit 
Control Act of 1985 is amended by adding the following new 
subparagraph:
                    ``(H) Continuing disability reviews and disability 
                eligibility redeterminations.--
                            ``(i) When an appropriations Act is enacted 
                        for fiscal year 1996, 1997, 1998, 1999, 2000, 
                        2001, or 2002 that specifies, under the heading 
                        ``Limitation on Administrative Expenses'' for 
                        the Social Security Administration, an amount 
                        for expenses for continuing disability reviews 
                        or disability eligibility redeterminations 
                        conducted pursuant to section 221(i) of the 
                        Social Security Act (42 U.S.C. 421(i)), section 
                        1614(a)(3)(H) of the Social Security Act (42 
                        U.S.C. 1382c(a)(3)(H)), section 1633 of the 
                        Social Security Act (42 U.S.C. 1383b), or 
                        section 208 of the Social Security Independence 
                        and Program Improvements Act of 1994 (Public 
                        Law 103-296), to the extent that appropriations 
                        are enacted that provide new budget authority, 
                        provide additional obligations limitation, or 
                        result in additional outlays, the discretionary 
                        spending limits for that fiscal year under 
                        section 601(a)(2) of the Congressional Budget 
                        Act of 1974 shall be adjusted by the new budget 
                        authority and the additional outlays for that 
                        purpose, but shall not exceed the amounts set 
                        forth below--
                                    ``(I) for fiscal year 1996, 
                                $60,000,000 in new budget authority and 
                                additional obligations limitation and 
                                $60,000,000 in additional outlays;
                                    ``(II) for fiscal year 1997, 
                                $260,000,000 in new budget authority 
                                and additional obligations limitation 
                                and $250,000,000 in additional outlays;
                                    ``(III) for fiscal year 1998, 
                                $475,000,000 in new budget authority 
                                and additional obligations limitation 
                                and $460,000,000 in additional outlays;
                                    ``(IV) for fiscal year 1999, 
                                $715,000,000 in new budget authority 
                                and additional obligations limitation 
                                and $700,000,000 in additional outlays;
                                    ``(V) for fiscal year 2000, 
                                $760,000,000 in new budget authority 
                                and additional obligations limitation 
                                and $760,000,000 in outlays;
                                    ``(VI) for fiscal year 2001, 
                                $715,000,000 in new budget authority 
                                and additional obligations limitation 
                                and $715,000,000 in outlays;
                                    ``(VII) for fiscal year 2002, 
                                $665,000,000 in new budget authority 
                                and additional obligations limitation 
                                and $665,000,000 in outlays;
                            ``(ii) As used in this subparagraph--
                                    ``(I) the term `new budget 
                                authority' shall mean budget authority, 
                                in any fiscal year, in excess of $100 
                                million;
                                    ``(II) the term `additional 
                                obligations limitation' shall mean 
                                obligations limitation, in any fiscal 
                                year, in excess of $100 million; and
                                    ``(III) the term `additional 
                                outlays' shall mean outlays, in any 
                                fiscal year, in excess of $200 
                                million.''.
    (b) Section 606 of the Congressional Budget and Impoundment Control 
Act of 1974 is amended by adding the following new subsection:
    ``(e) Disability Review and Eligibility Redetermination 
Adjustment.--
            ``(1) For purposes of points of order under this Act and 
        concurrent resolutions on the budget, when the Appropriations 
        Committee reports an appropriations measure for fiscal year 
        1996, 1997, 1998, 1999, 2000, 2001, or 2002 that specifies, 
        under the heading `Limitation on Administrative Expenses' for 
        the Social Security Administration, an amount for expenses for 
        continuing disability reviews or disability eligibility 
        redeterminations pursuant to section 221(i) of the Social 
        Security Act (42 U.S.C. 421(i)), section 1614(a)(3)(H) of the 
        Social Security Act (42 U.S.C. 1382c(a)(3)(H)), section 1633 of 
        the Social Security Act (42 U.S.C. 1383b), or section 208 of 
        the Social Security Independence and Program Improvements Act 
        of 1994 (Public Law 103-296), or when a conference committee 
        submits a conference report thereon--
                    ``(A) the discretionary spending limits for that 
                fiscal year--
                            ``(i) under section 601(a)(2), or
                            ``(ii) as set forth in the most recently 
                        adopted concurrent resolution on the budget;
                    ``(B) the allocations to the Committee on 
                Appropriations of the Senate and the House for that 
                fiscal year under sections 302(a) and 602(a); and
                    ``(C) the appropriate budgetary aggregates for that 
                fiscal year in the most recently adopted concurrent 
                resolution on the budget shall be adjusted in 
                accordance with paragraph (2).
            ``(2) Adjustment of budgetary levels.--The adjustments 
        required by paragraph (1) shall be made by the Chairman of the 
        Committee on the Budget of the Senate or the House of 
        Representatives (as the case may be) and shall reflect the new 
        budget authority and the additional outlays for continuing 
        disability reviews and disability eligibility redeterminations 
        provided in that measure or conference report, but shall not 
        exceed the levels set forth in section 251(b)(2)(H) of the 
        Balanced Budget and Emergency Deficit Control Act of 1985, for 
        any year. These adjusted discretionary spending limits, 
        allocations, and aggregates shall be considered the appropriate 
        limits, allocations, and aggregates for purposes of 
        congressional enforcement of this Act and concurrent budget 
        resolutions under this Act.
            ``(3) Reporting revised suballocations.--Following the 
        adjustments made under paragraph (2), the Committees on 
        Appropriations of the Senate and the House of Representatives 
        may report appropriately revised suballocations pursuant to 
        sections 302(b) and 602(b) of this Act to carry out this 
        subsection.
            ``(4) Additional amounts.--As used in this section, the 
        term `new budget authority' shall mean budget authority for a 
        fiscal year in excess of $100 million, and the term `additional 
        outlays' shall mean outlays for a fiscal year in excess of $200 
        million.''.

SEC. 508. INSTALLMENT PAYMENT OF LARGE PAST-DUE SUPPLEMENTAL SECURITY 
              INCOME BENEFITS.

    (a) In General.--Section 1631(a) is amended by adding at the end a 
new paragraph as follows:
            ``(10)(A) If an individual is eligible for past-due monthly 
        benefits under this title (which includes, for purposes of this 
        paragraph, State supplementary payments made by the 
        Commissioner pursuant to an agreement under section 1616 (a) of 
        this title or section 212(b) of Public Law 93-66) in an amount 
        that (after any withholding for reimbursement to a State for 
        interim assistance under subsection (g)) equals or exceeds the 
        product of--
                    ``(i) twelve, and
                    ``(ii) the maximum monthly benefit payable under 
                this title to an eligible individual (or, if 
                appropriate, to an eligible individual and eligible 
                spouse), then the payment of such past-due benefits 
                (after any such reimbursement to a State) shall be made 
                in installments as provided in subparagraph (B).
            ``(B)(i) The payment of past-due benefits subject to this 
        subparagraph shall be made in not to exceed three installments 
        that are made at six-month intervals.
            ``(ii) Except as provided in clause (iii), the amount of 
        each of the first and second installments may not exceed an 
        amount equal to the product of clauses (i) and (ii) of 
        subparagraph (A).
            ``(iii) In the case of an individual who has--
                    ``(I) outstanding debt attributable to--
                            ``(aa) food,
                            ``(bb) clothing,
                            ``(cc) shelter, or
                            ``(dd) medically necessary services, 
                        supplies or equipment, or medicine; or
                    ``(II) current expenses or expenses anticipated in 
                the near term attributable to--
                            ``(aa) medically necessary services, 
                        supplies or equipment, or medicine, or
                            ``(bb) the purchase of a home, and such 
                        debt or expenses are not subject to 
                        reimbursement by a public assistance program, 
                        the Secretary of Health and Human Services 
                        under title XVIII, a State plan approved under 
                        title XIX, or any private entity legally liable 
                        to provide payment pursuant to an insurance 
                        policy, pre-paid plan, or other arrangement, 
                        the limitation specified in clause (ii) may be 
exceeded by an amount equal to the total of such debt and expenses.
            ``(C) This paragraph shall not apply to any individual who, 
        at the time of the Commissioner's determination that such 
        individual is eligible for the payment of past-due monthly 
        benefits under this title--
                    ``(i) is afflicted with a medically determinable 
                impairment that is expected to result in death within 
                twelve months; or
                    ``(ii) is ineligible for benefits under this title 
                and the Commissioner determines that such individual is 
                likely to remain ineligible for the next 12 months.''.
    (b) Conforming Amendment.--Section 1631(a)(1) is amended by 
inserting ``(subject to paragraph (10))'' before ``in such 
installments''.
    (c) Effective Date.--The amendments made by this section are 
effective with respect to past-due benefits payable under title XVI of 
the Social Security Act (including State supplementary payments made by 
the Commissioner of Social Security pursuant to an agreement under 
section 1616(a) of such Act or section 212(b) of Public Law 93-66) 
after the third month following the month in which this Act is enacted.

SEC. 509. RECOVERY OF SUPPLEMENTAL SECURITY INCOME OVERPAYMENTS FROM 
              SOCIAL SECURITY BENEFITS.

    (a) In General.--Title XI is amended by adding after section 1145 
(as added by section 401 and amended by section 402 of this Act) a new 
section as follows:

``SEC. 1146. RECOVERY OF SSI OVERPAYMENTS FROM SOCIAL SECURITY 
              BENEFITS.

    ``(a) In General.--Whenever the Commissioner of Social Security 
determines that more than the correct amount of any payment has been 
made to any person under the supplemental security income program 
authorized by title XVI of this Act (which includes, for purposes of 
this section, State supplementary payments which are made by the 
Commissioner under an agreement pursuant to section 1616(a) of this Act 
or section 212(b) of Public Law 93-66), and the Commissioner is unable 
to make proper adjustment or recovery of the amount so incorrectly paid 
as provided in section 1631(b) of this Act, the Commissioner 
(notwithstanding section 207 of this Act) may recover the amount 
incorrectly paid by decreasing any amount which is payable under the 
Federal Old-Age and Survivors Insurance program or the Federal 
Disability Insurance program authorized by title II of this Act to that 
person or his estate.
    ``(b) No Effect on SSI Benefit Eligibility or Amount.--
Notwithstanding sections 1611 (a) and (b) of this Act, in any case in 
which the Commissioner takes action in accordance with subsection (a) 
to recover an overpayment from any person, neither that person, nor any 
individual whose eligibility or benefit amount is determined by 
considering any part of that person's income, shall, as a result of 
such action--
            ``(1) become eligible under the program of supplemental 
        security income benefits under title XVI of this Act, or
            ``(2) if such person or individual is already so eligible, 
        become eligible for increased benefits thereunder.''.
    (b) Conforming Changes.--
            (1) Section 204 is amended by adding at the end a new 
        subsection as follows:
    ``(g) For payments which are adjusted or withheld to recover an 
overpayment of supplemental security income benefits paid under title 
XVI of this Act (including State supplementary payments which were paid 
under an agreement pursuant to section 1616(a) of this Act or section 
212(b) of Public Law 93-66), see section 1146.''.
            (2) Section 1631(b) is amended by adding at the end a new 
        paragraph as follows:
            ``(5) For the recovery of overpayments of benefits under 
        this title from benefits payable under title II, see section 
        1146.''.
    (c) Effective Date.--The amendments made by this section take 
effect upon the date of the enactment of this Act and shall apply to 
overpayments outstanding on or after such date.

SEC. 510. ALLOWANCE UNDER THE DISCRETIONARY SPENDING LIMITS FOR 
              ADMINISTRATIVE EXPENSES TO IMPLEMENT CHANGES TO 
              SUPPLEMENTAL SECURITY INCOME PROGRAM.

    (a) Section 251(b)(2) of the Balanced Budget and Emergency Deficit 
Control Act of 1985, as amended by section 507 of this Act, is further 
amended by adding at the end the following new subparagraph:
                    ``(I) Administrative expenses to implement reforms 
                to supplemental security income program made by the 
                work first and personal responsibility act of 1996.--
                When an appropriations Act is enacted for fiscal year 
                1996, 1997, or 1998 that specifies, under the heading 
                `Limitation on Administrative Expenses' for the Social 
                Security Administration, an amount for expenses to 
                implement reforms to the supplemental security income 
                program made by the Work First and Personal 
                Responsibility Act of 1996, to the extent that 
                appropriations are enacted that provide budget 
                authority and result in outlays, the discretionary 
                spending limits for that fiscal year under section 
                601(a)(2) of the Congressional Budget Act of 1974 shall 
                be adjusted by the budget authority and the outlays for 
                that purpose, but shall not exceed the amounts set 
                forth below--
                            ``(i) for fiscal year 1996, $50,000,000 in 
                        budget authority and $47,000,000 in outlays;
                            ``(ii) for fiscal year 1997, $250,000,000 
                        in budget authority and $238,000,000 in 
                        outlays;
                            ``(iii) for fiscal year 1998, $0 in budget 
                        authority and $15,000,000 in outlays.''.
    (b) Section 606 of the Congressional Budget and Impoundment Control 
Act of 1974 is amended by adding the following new subsection:
    ``(f) Administrative Expenses To Implement Reforms to Supplemental 
Security Income Program Adjustment.--
            ``(1) For purposes of points of order under this Act and 
        concurrent resolutions on the budget, when the Appropriations 
        Committee reports an appropriations measure for fiscal year 
        1996, 1997, or 1998 that specifies, under the heading 
        `Limitation on Administrative Expenses' for the Social Security 
        Administration, an amount for expenses to implement reforms to 
        the supplemental security income program made by the Work First 
        and Personal Responsibility Act of 1996, or when a conference 
        committee submits a conference report thereon,--
                    ``(A) the discretionary spending limits for that 
                fiscal year--
                            ``(i) under section 601(a)(2), or
                            ``(ii) as set forth in the most recently 
                        adopted concurrent resolution on the budget;
                    ``(B) the allocations to the Committee on 
                Appropriations of the Senate and the House for that 
                fiscal year under sections 302(a) and 602(a); and
                    ``(C) the appropriate budgetary aggregates for that 
                fiscal year in the most recently adopted concurrent 
                resolution on the budget shall be adjusted in 
                accordance with paragraph (2).
            ``(2) Adjustment of budgetary levels.--The adjustments 
        required by paragraph (1) shall be made by the Chairman of the 
        Committee on the Budget of the Senate or the House of 
        Representatives (as the case may be) and shall reflect the 
        budget authority and the outlays for expenses to implement 
        reforms to the supplemental security income program made by the 
        Work First and Personal Responsibility Act of 1996 provided in 
        that measure or conference report, but shall not exceed the 
        levels set forth in section 251(b)(2)(I) of the Balanced Budget 
        and Emergency Deficit Control Act of 1985, for any year. These 
        adjusted discretionary spending limits, allocations, and 
        aggregates shall be considered the appropriate limits, 
        allocations, and aggregates for purposes of congressional 
        enforcement of this Act and concurrent budget resolutions under 
        this Act.
            ``(3) Reporting revised suballocations.--Following the 
        adjustments made under paragraph (2), the Committees on 
        Appropriations of the Senate and the House of Representatives 
        may report appropriately revised suballocations pursuant to 
        sections 302(b) and 602(b) of this Act to carry out this 
        subsection.''.

SEC. 511. REDUCTION IN CASH BENEFITS PAYABLE TO INSTITUTIONALIZED 
              INDIVIDUALS WHOSE MEDICAL COSTS ARE COVERED BY PRIVATE 
              INSURANCE.

    (a) In General.--Section 1611(e)(1)(B) (42 U.S.C. 1382(e)(1)(B)) is 
amended--
            (1) by striking ``or'' after ``XIX,''; and
            (2) by inserting ``or, in the case of an eligible 
        individual under the age of 18 receiving payments (with respect 
        to such individual) under any health insurance policy issued by 
        a private provider of such insurance'' after ``section 
        1614(f)(2)(B),''.
    (b) Effective Date.--The amendments made by this section apply to 
benefits for months beginning 90 or more days after the date of the 
enactment of this Act, without regard to whether regulations have been 
issued to implement such amendments.

                 TITLE F--SOCIAL SERVICES BLOCK GRANTS

SEC. 601. REDUCTION IN TITLE XX BLOCK GRANTS TO STATES FOR SOCIAL 
              SERVICES.

    Section 2003(c) of the Social Security Act (42 U.S.C. 1397b(c)) is 
amended--
            (1) by striking ``and'' at the end of paragraph (4);
            (2) in paragraph (5), by striking ``fiscal year after 
        fiscal year 1989.'' and inserting ``of fiscal years 1990 
        through 1995;''; and
            (3) by adding at the end the following:
            ``(6) $2,730,000,000 for fiscal year 1996; and
            (7) $2,520,000,000 for fiscal year 1997 and each succeeding 
        fiscal year.''.
                                 <all>