[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4 Introduced in House (IH)]







104th CONGRESS
  1st Session
                                 H. R. 4

 To restore the American family, reduce illegitimacy, control welfare 
                spending and reduce welfare dependence.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 4, 1995

     Mr. Shaw, Mr. Talent, and Mr. LaTourette (for themselves, Mr. 
  Hutchinson, Mr. Hostettler, Mr. Jones, Mr. Tiahrt, Mrs. Myrick, Mr. 
   Ensign, Mrs. Cubin, Mr. Kingston, Mr. Hastings of Washington, Mr. 
  Ganske, Mr. Ewing, Mr. Weldon of Florida, Mr. Coburn, Mr. Lewis of 
   Kentucky, Mr. Bunning of Kentucky, Mr. Foley, Mr. Inglis of South 
   Carolina, Mr. Lightfoot, Mr. Istook, Mr. Calvert, Mr. Hobson, Mr. 
 Cremeans, Mr. Knollenberg, Mr. Bilirakis, Mr. Hayworth, Mr. Fox, Mr. 
   Radanovich, Mr. Roth, Mr. Wamp, Mr. Goodling, Mr. Gilchrest, Mr. 
    Solomon, Mr. Bliley, Mr. Doolittle, Mr. Packard, Mr. Stump, Mr. 
 Everett, Mr. Gilman, Mr. Miller of Florida, Mr. Dornan, Mr. Hastert, 
Mr. Cunningham, Mr. Forbes, Mr. Linder, Mr. Blute, Mr. Rohrabacher, Mr. 
Cooley, Mr. Smith of Texas, Mr. Clinger, Mr. Bachus, Mr. Ballenger, Mr. 
 Callahan, Mr. English of Pennsylvania, Mr. Saxton, Mr. Chrysler, Mr. 
Camp, Mr. Hancock, Mr. Nussle, Mr. Greenwood, Mr. Bartlett of Maryland, 
 Mr. Taylor of North Carolina, Mr. McCrery, Mr. Largent, Mr. Baker of 
Louisiana, Mr. Collins of Georgia, Mr. Archer, Mr. Thomas, Mr. Herger, 
   Mr. Sam Johnson of Texas, Mr. Stearns, Mr. Stockman, Mr. Smith of 
Michigan, Mr. Baker of California, Mrs. Roukema, Mr. Sensenbrenner, Mr. 
 Heineman, Mrs. Fowler, Mr. Royce, Mr. Flanagan, Mr. Burr, Mr. Latham, 
Ms. Molinari, Mr. Gunderson, Mr. Riggs, Mr. Thornberry, Mr. Allard, Mr. 
  Christensen, Mr. Goodlatte, Mr. Hilleary, Mr. Wicker, Mr. Bono, Mr. 
Frisa, Mr. Shadegg, Mr. Canady, Mr. McCollum, Mr. Barton of Texas, Mr. 
Barr, Mr. Armey, Mr. Horn, Ms. Dunn of Washington, Mr. Tate, Mr. Mica, 
Mr. Crapo, Mr. Paxon, Mr. Young of Florida, Mr. Weldon of Pennsylvania, 
Mr. Combest, Mr. Coble, and Mr. Ehrlich) introduced the following bill; 
                     which was referred as follows:
Title I, referred to the Committee on Ways and Means and, in addition, 
to the Committee on Banking and Financial Services, 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
Title II, referred to the Committee on Ways and Means and, in addition, 
   to the Committee on Economic and Educational Opportunities, 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
    Title III, referred to the Committee on Ways and Means and, in 
addition, to the Committees on Banking and Financial Services, Economic 
 and Educational Opportunities, the Budget, and Rules, 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
Title IV, referred to the Committee on Ways and Means and, in addition, 
to the Committees on Banking and Financial Services, Commerce, Economic 
 and Educational Opportunities, the Judiciary, and Agriculture, 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
Title V, referred to the Committee on Agriculture and, in addition, to 
   the Committees on Economic and Educational Opportunities and the 
 Judiciary, 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
       Title VI-VII, referred to the Committee on Ways and Means
    Title VIII, referred to the Committee on Ways and Means and, in 
   addition, to the Committees on Agriculture, Budget, Economic and 
 Educational Opportunities, Banking and Financial Services, Commerce, 
Agriculture, the Judiciary, and Rules, 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 restore the American family, reduce illegitimacy, control welfare 
                spending and reduce welfare dependence.

    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 ``Personal Responsibility Act of 
1995''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
                     TITLE I--REDUCING ILLEGITIMACY

Sec. 100. Sense of the Congress.
Sec. 101. Reduction or denial of AFDC for certain children whose 
                            paternity is not established.
Sec. 102. Teens receiving AFDC required to live at home.
Sec. 103. Earlier paternity establishment efforts by States.
Sec. 104. Increase in paternity establishment percentage.
Sec. 105. Denial of AFDC for certain children born out-of-wedlock.
Sec. 106. Denial of AFDC for additional children.
Sec. 107. State option to deny AFDC benefits to children born out-of-
                            wedlock to individuals aged 18, 19, or 20, 
                            and to deny such benefits and housing 
                            benefits to such individuals.
Sec. 108. Grants to States for assistance to children born out-of-
                            wedlock.
Sec. 109. Removal of barriers to interethnic adoption.
                        TITLE II--REQUIRING WORK

Sec. 201. Findings; intent; statement of purpose.
Sec. 202. Work program.
Sec. 203. Work supplementation program amendments.
Sec. 204. Payments to States for certain individuals receiving food 
                            assistance from the State who perform work 
                            on behalf of the State.
      TITLE III--CAPPING THE AGGREGATE GROWTH OF WELFARE SPENDING

Sec. 301. Cap on growth of Federal spending on certain welfare 
                            programs.
Sec. 302. Conversion of funding under certain welfare programs.
Sec. 303. Savings from welfare spending limits to be used for deficit 
                            reduction.
                TITLE IV--RESTRICTING WELFARE FOR ALIENS

Sec. 401. Ineligibility of aliens for public welfare assistance.
Sec. 402. State AFDC agencies required to provide information on 
                            illegal aliens to the Immigration and 
                            Naturalization Service.
            TITLE V--CONSOLIDATING FOOD ASSISTANCE PROGRAMS

Sec. 501. Food assistance block grant program.
Sec. 502. Availability of Federal coupon system to States.
Sec. 503. Authority to sell Federal surplus commodities.
Sec. 504. Definitions.
Sec. 505. Repealers; amendments.
Sec. 506. Effective date; application of repealers and amendments.
          TITLE VI--EXPANDING STATUTORY FLEXIBILITY OF STATES

Sec. 601. Option to convert AFDC into a block grant program.
Sec. 602. Option to treat new residents of a State under rules of 
                            former State.
Sec. 603. Option to impose penalty for failure to attend school.
Sec. 604. Option to provide married couple transition benefit.
Sec. 605. Option to disregard income and resources designated for 
                            education, training, and employability, or 
                            related to self-employment.
Sec. 606. Option to require attendance at parenting and money 
                            management classes, and prior approval of 
                            any action that would result in a change of 
                            school for a dependent child.
             TITLE VII--DRUG TESTING FOR WELFARE RECIPIENTS

Sec. 701. AFDC recipients required to undergo necessary substance abuse 
                            treatment as a condition of receiving AFDC.
                       TITLE VIII--EFFECTIVE DATE

Sec. 801. Effective date.

                     TITLE I--REDUCING ILLEGITIMACY

SEC. 100. SENSE OF THE CONGRESS.

    It is the sense of the Congress that--
            (1) marriage is the foundation of a successful society;
            (2) marriage is an essential social institution which 
        promotes the interests of children and society at large;
            (3) the negative consequences of an out-of-wedlock birth on 
        the child, the mother, and society are well documented as 
        follows:
                    (A) the illegitimacy rate among black Americans was 
                26 percent in 1965, but today the rate is 68 percent 
                and climbing;
                    (B) the illegitimacy rate among white Americans has 
                risen tenfold, from 2.29 percent in 1960 to 22 percent 
                today;
                    (C) the total of all out-of-wedlock births between 
                1970 and 1991 has risen from 10 percent to 30 percent 
                and if the current trend continues, 50 percent of all 
                births by the year 2015 will be out-of-wedlock;
                    (D) \3/4\ of illegitimate births among whites are 
                to women with a high school education or less;
                    (E) the 1-parent family is 6 times more likely to 
                be poor than the 2-parent family;
                    (F) children born into families receiving welfare 
                assistance are 3 times more likely than children not 
                born into families receiving welfare to be on welfare 
                when they reach adulthood;
                    (G) teenage single parent mothering is the single 
                biggest contributor to low birth weight babies;
                    (H) children born out-of-wedlock are more likely to 
                experience low verbal cognitive attainment, child 
                abuse, and neglect;
                    (I) young people from single parent or stepparent 
                families are 2 to 3 times more likely to have emotional 
                or behavioral problems than those from intact families;
                    (J) young white women who were raised in a single 
                parent family are more than twice as likely to have 
                children out-of-wedlock and to become parents as 
                teenagers, and almost twice as likely to have their 
                marriages end in divorce, as are children from 2-parent 
                families;
                    (K) the younger the single parent mother, the less 
                likely she is to finish high school;
                    (L) young women who have children before finishing 
                high school are more likely to receive welfare 
                assistance for a longer period of time;
                    (M) between 1985 and 1990, the public cost of 
                births to teenage mothers under the aid to families 
                with dependent children program, the food stamp 
                program, and the medicaid program has been estimated at 
                $120,000,000,000;
                    (N) the absence of a father in the life of a child 
                has a negative effect on school performance and peer 
                adjustment;
                    (O) the likelihood that a young black man will 
                engage in criminal activities doubles if he is raised 
                without a father and triples if he lives in a 
                neighborhood with a high concentration of single parent 
                families; and
                    (P) the greater the incidence of single parent 
                families in a neighborhood, the higher the incidence of 
                violent crime and burglary; and
            (4) in light of this demonstration of the crisis in our 
        Nation, the reduction of out-of-wedlock births is an important 
        government interest and the policy contained in provisions of 
        this title address the crisis.

SEC. 101. REDUCTION OR DENIAL OF AFDC FOR CERTAIN CHILDREN WHOSE 
              PATERNITY IS NOT ESTABLISHED.

    (a) In General.--Section 402(a) of the Social Security Act (42 
U.S.C. 602(a)) is amended--
            (1) by striking ``and'' at the end of paragraph (44);
            (2) by striking the period at the end of paragraph (45) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (45) the following:
            ``(46) provide that--
                    ``(A) except as provided in subparagraph (B), aid 
                under the State plan shall not be payable, to a family 
                on whose behalf an application for such aid is made 
                after the effective date of this paragraph, with 
                respect to a dependent child whose paternity has not 
                been established, unless--
                            ``(i) the child was conceived as a result 
                        of rape or incest; or
                            ``(ii) the State determines that efforts to 
                        establish such paternity would result in 
                        physical danger to the child or the relative 
                        claiming such aid;
                    ``(B) if the paternity of a dependent child has not 
                been established, the relative claiming such aid 
                alleges that any of not more than 3 named individuals 
                may be the biological father of the child and provides 
                the address of each of the named individuals (or, if 
                the relative is not aware of the address of such a 
                named individual, the address of the immediate 
                relatives of the named individual), and the State has 
                not disproved the allegation, then aid under the State 
                plan may not be denied to the family by reason of 
                subparagraph (A), but the needs of the dependent child 
                shall be disregarded in determining the amount of such 
                aid;
                    ``(C) the relative claiming such aid shall have the 
                burden of proving any allegation of paternity of a 
                dependent child by an individual who is deceased, in 
                accordance with procedures established by the State in 
                consultation with the Secretary; and
                    ``(D) if the amount of aid payable to a family 
                under the State plan is reduced by reason of this 
                paragraph, each member of the family shall be 
                considered to be receiving such aid for purposes of 
                eligibility for medical assistance under the State plan 
                approved under title XIX for so long as such aid would 
                otherwise not be so reduced.''.
    (b) No Effect on Eligibility for Foster Care Maintenance 
Payments.--Section 472(a)(4)(B) of such Act (42 U.S.C. 672(a)(4)(B)) is 
amended--
            (1) in clause (i), by inserting ``and section 402(a)(46) 
        were not applied to the child'' before the comma; and
            (2) in clause (ii), by inserting ``, section 402(a)(46) 
        were not applied to the child,'' before ``and application''.
    (c) No Effect on Eligibility for Adoption Assistance Payments.--
Section 473(a)(2)(B)(ii) of such Act (42 U.S.C. 673(a)(2)(B)(ii)) is 
amended--
            (1) in subclause (I), by inserting ``and section 402(a)(46) 
        were not applied to the child'' before the comma; and
            (2) in subclause (II), by inserting ``, section 402(a)(46) 
        were not applied to the child,'' before ``and application''.

SEC. 102. TEENS RECEIVING AFDC REQUIRED TO LIVE AT HOME.

    Section 402(a)(43) of the Social Security Act (42 U.S.C. 
602(a)(43)) is amended--
            (1) by striking ``at the option of the State,''; and
            (2) by striking ``18'' and inserting ``19''.

SEC. 103. EARLIER PATERNITY ESTABLISHMENT EFFORTS BY STATES.

    (a) In General.--Section 466(a)(5)(C) of the Social Security Act 
(42 U.S.C. 666(a)(5)(C)) is amended by redesignating clauses (i) and 
(ii) as clauses (ii) and (iii) and by inserting before clause (ii) (as 
so redesignated) the following: ``(i) a requirement that, as soon as an 
officer or employee of the State becomes aware, in the performance of 
official duties, of a pregnant, unmarried individual, the officer or 
employee (I) inform the individual, orally and in writing, that she 
will be ineligible for aid under the State plan under part A unless she 
informs the State of the identity of the prospective father and, after 
the child is born, cooperates in establishing the paternity of the 
child, and (II) encourage the individual to urge the prospective father 
to acknowledge paternity,''.
    (b) Conforming Amendments.--Section 466(a)(5) of such Act (42 
U.S.C. 666(a)(5)) is amended in each of subparagraphs (D) and (E) by 
striking ``(C)(ii)'' and inserting ``(C)(iii)''.
    (c) Sense of the Congress.--The Congress encourages the States to--
            (1) develop procedures in public hospitals and clinics to 
        facilitate the acknowledgement of paternity; and
            (2) establish legal procedures that permit the 
        establishment of paternity as quickly and easily as possible.

SEC. 104. INCREASE IN PATERNITY ESTABLISHMENT PERCENTAGE.

    Section 452(g)(1) of the Social Security Act (42 U.S.C. 652(g)(1)) 
is amended by striking all that follows ``--'' and inserting the 
following:
            ``(A) 90 percent;
            ``(B) for a State with a paternity establishment percentage 
        of not less than 50 percent but less than 90 percent for such 
        fiscal year, the paternity establishment percentage of the 
        State for the immediately preceding fiscal year plus 6 
        percentage points; or
            ``(C) for a State with a paternity establishment percentage 
        of less than 50 percent for such fiscal year, the paternity 
        establishment percentage of the State for the immediately 
        preceding fiscal year plus 10 percentage points.''.

SEC. 105. DENIAL OF AFDC FOR CERTAIN CHILDREN BORN OUT-OF-WEDLOCK.

    (a) Denial of AFDC.--Section 402(a) of the Social Security Act (42 
U.S.C. 602(a)), as amended by section 101(a) of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (45);
            (2) by striking the period at the end of paragraph (46) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (46) the following:
            ``(47) provide that--
                    ``(A) aid under the plan shall not be payable with 
                respect to a child born out-of-wedlock, on or after the 
                effective date of this paragraph, to an individual who, 
                at the time of such birth, had not attained 18 years of 
                age, unless, after the birth of the child--
                            ``(i) the individual marries an individual 
                        who the State determines is the biological 
                        father of the child; or
                            ``(ii) the biological parent of the child 
                        has legal custody of the child and marries an 
                        individual who legally adopts the child; and
                    ``(B) if the amount of aid payable to a family 
                under the State plan is reduced by reason of this 
                paragraph, each member of the family shall be 
                considered to be receiving such aid for purposes of 
                eligibility for medical assistance under the State plan 
                approved under title XIX for so long as such aid would 
                otherwise not be so reduced.''.
    (b) No Effect on Eligibility for Foster Care Maintenance 
Payments.--Section 472(a)(4)(B) of such Act (42 U.S.C. 672(a)(4)(B)), 
as amended by section 101(b) of this Act, is amended in each of clauses 
(i) and (ii) by striking ``section 402(a)(46)'' and inserting 
``paragraphs (46) and (47) of section 402(a)''.
    (c) No Effect on Eligibility for Adoption Assistance Payments.--
Section 473(a)(2)(B)(ii) of such Act (42 U.S.C. 673(a)(2)(B)(ii)), as 
amended by section 101(b) of this Act, is amended in each of subclauses 
(I) and (II) by striking ``section 402(a)(46)'' and inserting 
``paragraphs (46) and (47) of section 402(a)''.

SEC. 106. DENIAL OF AFDC FOR ADDITIONAL CHILDREN.

    (a) In General.--Section 402(a) of the Social Security Act (42 
U.S.C. 602(a)), as amended by sections 101(a) and 105(a)(1) of this 
Act, is amended--
            (1) by striking ``and'' at the end of paragraph (46);
            (2) by striking the period at the end of paragraph (47) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (47) the following:
            ``(48)(A) provide that aid under the plan shall not be 
        payable with respect to a child born on or after the effective 
        date of this paragraph to--
                    ``(i) a recipient of aid under any State plan 
                approved under this part; or
                    ``(ii) an individual who received aid under any 
                such State plan at any time during the 10-month period 
                ending with the birth of the child,
        unless the recipient or individual was pregnant with the child 
        at the time of application for such aid; and
            ``(B) if the amount of aid payable to a family under the 
        State plan is reduced by reason of this paragraph, each member 
        of the family shall be considered to be receiving such aid for 
        purposes of eligibility for medical assistance under the State 
        plan approved under title XIX for so long as such aid would 
        otherwise not be so reduced.''.
    (b) No Effect on Eligibility for Foster Care Maintenance 
Payments.--Section 472(a)(4)(B) of such Act (42 U.S.C. 672(a)(4)(B)), 
as amended by sections 101(b) and 105(b) of this Act, is amended in 
each of clauses (i) and (ii) by striking ``and (47)'' and inserting ``, 
(47), and (48)''.
    (c) No Effect on Eligibility for Adoption Assistance Payments.--
Section 473(a)(2)(B)(ii) of such Act (42 U.S.C. 673(a)(2)(B)(ii)), as 
amended by sections 101(c) and 105(c) of this Act, is amended in each 
of subclauses (I) and (II) by striking ``and (47)'' and inserting ``, 
(47), and (48)''.

SEC. 107. STATE OPTION TO DENY AFDC BENEFITS TO CHILDREN BORN OUT-OF-
              WEDLOCK TO INDIVIDUALS AGED 18, 19, OR 20, AND TO DENY 
              AFDC BENEFITS AND HOUSING BENEFITS TO SUCH INDIVIDUALS.

    (a) Denial of AFDC.--
            (1) In general.--Section 402(a) of the Social Security Act 
        (42 U.S.C. 602(a)), as amended by sections 101(a), 105(a)(1), 
        and 106 of this Act, is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (47);
                    (B) by striking the period at the end of paragraph 
                (48) and inserting ``; and''; and
                    (C) by inserting after paragraph (48) the 
                following:
            ``(49) at the option of the State, provide that--
                    ``(A) aid under the plan shall not be payable with 
                respect to a child born out-of-wedlock to an individual 
                who, at the time of such birth, had attained 18 years 
                of age but had not attained such age not exceeding 21 
                years as the State may determine; and
                    ``(B) aid under the plan shall not be payable with 
                respect to an individual who has borne a child out-of-
                wedlock after attaining 18 years of age but before 
                attaining 21 years of age, unless--
                            ``(i) after the birth of the child--
                                    ``(I) the individual marries an 
                                individual who the State determines is 
                                the biological father of the child; or
                                    ``(II) the biological parent of the 
                                child has legal custody of the child 
                                and marries an individual who legally 
                                adopts the child; or
                            ``(ii) the individual is a biological and 
                        custodial parent of another child who was not 
                        born out-of-wedlock.''.
            (2) No effect on eligibility for foster care maintenance 
        payments.--Section 472(a)(4)(B) of such Act (42 U.S.C. 
        672(a)(4)(B)), as amended by sections 101(b), 105(b), and 
        106(b) of this Act, is amended in each of clauses (i) and (ii) 
        by striking ``and (48)'' and inserting ``(48), and (49)''.
            (3) No effect on eligibility for adoption assistance 
        payments.--Section 473(a)(2)(B)(ii) of such Act (42 U.S.C. 
        673(a)(2)(B)(ii)), as amended by sections 101(c), 105(c), and 
        106(c) of this Act, is amended in each of subclauses (I) and 
        (II) by striking ``and (48)'' and inserting ``(48), and (49)''.
            (4) Limitation on applicability.--The amendments made by 
        this subsection shall not apply to a child born before the 
        effective date of this Act who is a member of a family whose 
        most recent application for aid to families with dependent 
        children under a State plan approved under part A of title IV 
        of the Social Security Act was made before such effective date.
    (b) Housing Benefits.--
            (1) Prohibition of assistance.--Notwithstanding any other 
        provision of law, a household whose head of household is an 
        individual who has borne a child out-of-wedlock after attaining 
        18 years of age but before attaining 21 years of age may not be 
        provided Federal housing assistance for a dwelling unit located 
        in a covered State, unless--
                    (A) after the birth of the child--
                            (i) the individual marries an individual 
                        who has been determined by the relevant State 
                        to be the biological father of the child; or
                            (ii) the biological parent of the child has 
                        legal custody of the child and marries an 
                        individual who legally adopts the child;
                    (B) the individual is a biological and custodial 
                parent of another child who was not born out-of-
                wedlock; or
                    (C) eligibility for such Federal housing assistance 
                is based in whole or in part on any disability or 
                handicap of a member of the household.
            (2) Covered states.--A State shall be considered a covered 
        State for purposes of this subsection only during the period 
        that--
                    (A) begins upon certification, made by the chief 
                executive officer of the State (at the option of the 
                State) to the Secretary of Housing and Urban 
                Development and the Secretary of Agriculture, that the 
                State is a covered State for purposes of this 
                subsection; and
                    (B) ends upon submission of written notice (at the 
                option of the State), by the chief executive officer of 
                the State to such Secretaries, that the State is not a 
                covered State for purposes of this subsection.
            (3) Notification of housing providers.--Upon certification 
        under paragraph (2)(A) for a State and periodically thereafter 
        during the period that the State is a covered State, the 
        Secretary of Housing and Urban Development and the Secretary of 
        Agriculture shall provide written notice that the State is a 
        covered State for purposes of this subsection to--
                    (A) each public housing agency whose area of 
                jurisdiction is located in whole or part within the 
                State; and
                    (B) the owner or manager of each covered project.
            (4) Definitions.--For purposes of this subsection, the 
        following definitions shall apply:
                    (A) Covered program.--The term ``covered program'' 
                means--
                            (i) the program of rental assistance on 
                        behalf of low-income families provided under 
                        section 8 of the United States Housing Act of 
                        1937 (42 U.S.C. 1437f);
                            (ii) the public housing program under title 
                        I of the United States Housing Act of 1937 (42 
                        U.S.C. 1437 et seq.);
                            (iii) the program of rent supplement 
                        payments on behalf of qualified tenants 
                        pursuant to contracts entered into under 
                        section 101 of the Housing and Urban 
                        Development Act of 1965 (12 U.S.C. 1701s);
                            (iv) the program of interest reduction 
                        payments pursuant to contracts entered into by 
                        the Secretary of Housing and Urban Development 
                        under section 236 of the National Housing Act 
                        (12 U.S.C. 1715z-1);
                            (v) the program for mortgage insurance 
                        provided pursuant to sections 221(d)(3) or (4) 
                        of the National Housing Act (12 U.S.C. 
                        1715l(d)) for multifamily housing for low- and 
                        moderate-income families;
                            (vi) the rural housing loan program under 
                        section 502 of the Housing Act of 1949 (42 
                        U.S.C. 1472);
                            (vii) the rural housing loan guarantee 
                        program under section 502(h) of the Housing Act 
                        of 1949 (42 U.S.C. 1472(h));
                            (viii) the loan and grant programs under 
                        section 504 of the Housing Act of 1949 (42 
                        U.S.C. 1474) for repairs and improvements to 
                        rural dwellings;
                            (ix) the program of loans for rental and 
                        cooperative rural housing under section 515 of 
                        the Housing Act of 1949 (42 U.S.C. 1485);
                            (x) the program of rental assistance 
                        payments pursuant to contracts entered into 
                        under section 521(a)(2)(A) of the Housing Act 
                        of 1949 (42 U.S.C. 1490a(a)(2)(A));
                            (xi) the loan and assistance programs under 
                        sections 514 and 516 of the Housing Act of 1949 
                        (42 U.S.C. 1484, 1486) for housing for farm 
                        labor;
                            (xii) the program of grants and loans for 
                        mutual and self-help housing and technical 
                        assistance under section 523 of the Housing Act 
                        of 1949 (42 U.S.C. 1490c);
                            (xiii) the program of grants for 
                        preservation and rehabilitation of housing 
                        under section 533 of the Housing Act of 1949 
                        (42 U.S.C. 1490m); and
                            (xiv) the program of site loans under 
                        section 524 of the Housing Act of 1949 (42 
                        U.S.C. 1490d).
                    (B) Covered project.--The term ``covered project'' 
                means any housing for which Federal housing assistance 
                is provided that is attached to the project or specific 
                dwelling units in the project.
                    (C) Federal housing assistance.--The term ``Federal 
                housing assistance'' means--
                            (i) assistance provided under a covered 
                        program in the form of any contract, grant, 
                        loan, subsidy, cooperative agreement, loan or 
                        mortgage guarantee or insurance, or other 
                        financial assistance; or
                            (ii) occupancy in a dwelling unit that is--
                                    (I) provided assistance under a 
                                covered program; or
                                    (II) located in a covered project 
                                and subject to occupancy limitations 
                                under a covered program that are based 
                                on income.
                    (D) Public housing agency.--The term ``public 
                housing agency'' has the meaning given the term in 
                section 3(a) of the United States Housing Act of 1937.
                    (E) State.--The term ``State'' means the States of 
                the United States, the District of Columbia, the 
                Commonwealth of Puerto Rico, the Commonwealth of the 
                Northern Mariana Islands, Guam, the Virgin Islands, 
                American Samoa, and any other territory or possession 
                of the United States.
            (5) Limitations on applicability.--Paragraph (1) shall not 
        apply to Federal housing assistance provided for a household 
        pursuant to an application or request for such assistance made 
        by such household before the effective date of this Act.

SEC. 108. GRANTS TO STATES FOR ASSISTANCE TO CHILDREN BORN OUT-OF-
              WEDLOCK.

    (a) In General.--Title IV of the Social Security Act (42 U.S.C. 601 
et seq.) is amended by inserting after part B the following:

    ``PART C--GRANTS FOR ASSISTANCE TO CHILDREN BORN OUT-OF-WEDLOCK

``SEC. 440. PURPOSE.

    ``(a) In General.--The purpose of this part is to grant a qualified 
State the flexibility and resources necessary to provide such services 
and activities as the State deems appropriate to discourage out-of-
wedlock births and assure care for children born out-of-wedlock.
    ``(b) Qualified State Defined.--For purposes of this part, the term 
`qualified State' means a State which--
            ``(1) has a plan approved under section 402;
            ``(2) has certified to the Secretary that--
                    ``(A) the payments made to the State under this 
                part will be used by the State in accordance with this 
                part; and
                    ``(B) not less frequently than every 2 years, the 
                State will audit the expenditures of the amounts paid 
                to the State under this part; and
            ``(3) has provided the Secretary with a copy of any audit 
        the performance of which was the subject of a prior 
        certification pursuant to paragraph (2).

``SEC. 441. USE OF GRANT FUNDS.

    ``(a) In General.--Except as provided in subsection (b), each 
qualified State that receives grant funds under this part shall use 
such funds--
            ``(1) to establish or expand programs to reduce out-of-
        wedlock pregnancies;
            ``(2) to promote adoption;
            ``(3) to establish and operate orphanages;
            ``(4) to establish and operate closely supervised 
        residential group homes for unwed mothers; or
            ``(5) in any manner that the State deems appropriate to 
        accomplish the purpose of this part.
    ``(b) Prohibitions on Use of Funds.--
            ``(1) No individual payments.--A qualified State that 
        receives grant funds under this part shall not use such funds 
        to provide cash payments to an individual who is the parent of 
        a child born out-of-wedlock or to the child.
            ``(2) No funds used for abortion.--No grant funds received 
        by a qualified State under this part shall be used for making 
        abortion available as a method of family planning or for any 
        counseling or advising with respect to abortion.
    ``(c) Penalty for Misuse of Funds.--If a qualified State fails to 
comply with subsection (b) in any fiscal year, the Secretary shall 
reduce the amount to be paid to such State under this part for the 
succeeding fiscal year by an amount equal to the amount of funds paid 
to the State under this part that are involved in the noncompliance.

``SEC. 442. AMOUNT OF GRANT.

    ``(a) In General.--The Secretary shall make a payment to each 
qualified State for each fiscal year in an amount equal to the Federal 
savings amount for the State determined under subsection (b)(1) for the 
fiscal year.
    ``(b) Determination of Grant Amount.--
            ``(1) In general.--The Federal savings amount for a State 
        for a fiscal year is an amount that is equal to the product 
        of--
                    ``(A) the State per capita amount for the fiscal 
                year (as determined under paragraph (2)); and
                    ``(B) the State's excluded population for the 
                fiscal year (as determined under paragraph (3)).
            ``(2) Per capita amount.--The State per capita amount for a 
        fiscal year is--
                    ``(A) the total amount that the Secretary estimates 
                will be paid to the State under paragraph (1) or (2) of 
                section 403(a) during the fiscal year; divided by
                    ``(B) the total number of individuals who the 
                Secretary estimates will receive aid under the State 
                plan approved under section 402 during the fiscal year.
            ``(3) State excluded population.--
                    ``(A) In general.--The Director of the Office of 
                Management and Budget shall determine an excluded 
                population for each qualified State for each fiscal 
                year in accordance with this paragraph.
                    ``(B) Determination.--A State's excluded population 
                for a fiscal year shall equal the sum of--
                            ``(i) the number of excluded children for 
                        the State for the fiscal year as determined 
                        under subparagraph (C); and
                            ``(ii) the number of excluded parents for 
                        the State for the fiscal year as determined 
                        under subparagraph (D).
                    ``(C) Excluded children.--
                            ``(i) In general.--The number of excluded 
                        children for a State for a fiscal year shall 
                        be--
                                    ``(I) for fiscal year 1996, zero;
                                    ``(II) for fiscal year 1997, 50 
                                percent of the monthly average number 
                                of base year excluded children (as 
                                defined in clause (ii)) who were under 
                                age 1 during the base year (as defined 
                                in clause (iii));
                                    ``(III) for fiscal year 1998, the 
                                sum of--
                                            ``(aa) the monthly average 
                                        number of base year excluded 
                                        children who were under age 1 
                                        during the base year; and
                                            ``(bb) 50 percent of the 
                                        monthly average number of base 
                                        year excluded children who were 
                                        over age 1 and under age 2 
                                        during the base year;
                                    ``(IV) for fiscal year 1999, the 
                                sum of--
                                            ``(aa) the monthly average 
                                        number of base year excluded 
                                        children who were under age 2 
                                        during the base year; and
                                            ``(bb) 50 percent of the 
                                        monthly average number of base 
                                        year excluded children who were 
                                        over age 2 and under age 3 
                                        during the base year;
                                    ``(V) for fiscal year 2000, the sum 
                                of--
                                            ``(aa) the monthly average 
                                        number of base year excluded 
                                        children who were under age 3 
                                        during the base year; and
                                            ``(bb) 50 percent of the 
                                        monthly average number of base 
                                        year excluded children who were 
                                        over age 3 and under age 4 
                                        during the base year; and
                                    ``(VI) for fiscal years after 
                                fiscal year 2000, a number determined 
                                by the Secretary using a formula 
                                which--
                                            ``(aa) takes into account 
                                        changes in out-of-wedlock birth 
                                        rates in previous years, State 
                                        incentives to continue programs 
                                        designed to reduce illegitimate 
                                        births, and other factors 
                                        deemed relevant by the 
                                        Secretary; and
                                            ``(bb) does not result in a 
                                        payment to any State under this 
                                        section for any fiscal year 
                                        that exceeds the payment made 
                                        to the State under this section 
                                        for fiscal year 2000.
                            ``(ii) Base year excluded children.--The 
                        term `base year excluded children' means 
                        children who received aid under the State plan 
                        approved under section 402 during the base year 
                        who would not have been eligible for such aid 
                        if paragraphs (47) and (49) of section 402(a) 
                        (as in effect during the applicable fiscal 
                        year) had been in effect at the time such 
                        children were born.
                            ``(iii) Base year.--For purposes of this 
                        part, the term `base year' means--
                                    ``(I) 1994, if the Congressional 
                                Budget Office is able to determine an 
                                excluded population for each State for 
                                each fiscal year that such a 
                                determination is required using data 
                                provided by the National Integrated 
                                Quality Control System operated by the 
                                Department of Health and Human Services 
                                and other relevant data sources; or
                                    ``(II) 1994, or another period 
                                determined appropriate by the 
                                Secretary, based on a survey conducted 
                                or approved by the Secretary.
                    ``(D) Excluded parents.--The number of excluded 
                parents for a State for a fiscal year shall be the 
                number of parents excluded in connection with the 
                exclusion of their children under subparagraph (C).''.
    (b) Study.--Not later than October 1, 1998, and not later than 
October 1 of each of the 3 immediately succeding years, the Comptroller 
General of the United States shall submit to the Congress a report on 
how States have expended funds provided under part C of title IV of the 
Social Security Act, the effect of such expenditures on the well-being 
of mothers and children, and whether there is evidence that 
illegitimacy rates have changed as as result of the implementation of 
such part. Any such report may address such related matters as the 
Comptroller General deems appropriate to examine.

SEC. 109. REMOVAL OF BARRIERS TO INTERETHNIC ADOPTION.

    (a) Findings.--The Congress finds that--
            (1) nearly 500,000 children are in foster care in the 
        United States;
            (2) tens of thousands of children in foster care are 
        waiting for adoption;
            (3) 2 years and 8 months is the median length of time that 
        children wait to be adopted;
            (4) child welfare agencies should work to eliminate racial, 
        ethnic, and national origin discrimination and bias in adoption 
        and foster care recruitment, selection, and placement 
        procedures; and
            (5) active, creative, and diligent efforts are needed to 
        recruit parents, from every race and culture, for children 
        needing foster care or adoptive parents.
    (b) Purpose.--The purpose of this section is to decrease the length 
of time that children wait to be adopted and to prevent discrimination 
in the placement of children on the basis of race, color, or national 
origin.
    (c) Multiethnic Placements.--
            (1) Activities.--
                    (A) Prohibition.--An agency or entity that receives 
                Federal assistance and is involved in adoption or 
                foster care placements may not--
                            (i) deny to any person the opportunity to 
                        become an adoptive or a foster parent, on the 
                        basis of the race, color, or national origin of 
                        the person, or of the child, involved; or
                            (ii) delay or deny the placement of a child 
                        for adoption or into foster care, or otherwise 
                        discriminate in making a placement decision, on 
                        the basis of the race, color, or national 
                        origin of the adoptive or foster parent, or the 
                        child, involved.
                    (B) Definition.--As used in this paragraph, the 
                term ``placement decision'' means the decision to 
                place, or to delay or deny the placement of, a child 
                into foster care or in an adoptive home, and includes 
                the decision of the agency or entity involved to seek 
                the termination of birth parent rights or otherwise 
                make a child legally available for adoptive placement.
            (2) Limitation.--The Secretary of Health and Human Services 
        shall not provide placement and administrative funds under 
        section 474(a)(3) of the Social Security Act (42 U.S.C. 
        674(a)(3)) to an agency or entity described in paragraph (1)(A) 
        of this subsection that is not in compliance with paragraph (1) 
        of this subsection.
            (3) Private cause of action.--
                    (A) In general.--Any individual who is aggrieved by 
                a violation of paragraph (1) by an agency or entity 
                described in paragraph (1)(A) may bring an action 
                seeking relief in any United States district court.
                    (B) Authority to award a reasonable attorney's 
                fee.--In an action brought under this paragraph, the 
                court, in its discretion, may allow a prevailing 
                plaintiff a reasonable attorney's fee as part of the 
                costs.
                    (C) Statute of limitations.--An action under this 
                paragraph may not be brought more than 2 years after 
                the date the alleged violation occurred.
                    (D) Waiver of state immunity.--This paragraph is 
                intended, among other things, to authorize actions 
                against States and State officials that might otherwise 
                be barred under the Eleventh Article of Amendment to 
                the Constitution of the United States, and is enacted 
                pursuant to section 5 of the Fourteenth Article of 
                Amendment to the Constitution of the United States.
            (4) Construction.--This subsection shall not be construed 
        to affect the application of the Indian Child Welfare Act of 
        1978 (25 U.S.C. 1901 et seq.).

                        TITLE II--REQUIRING WORK

SEC. 201. FINDINGS; INTENT; STATEMENT OF PURPOSE.

    (a) Findings.--The Congress finds that--
            (1) the cash value of the typical welfare package of AFDC, 
        food stamps, and medicaid is approximately $12,000 per year;
            (2) research shows that adults who leave AFDC for paid 
        employment earn approximately $5.50 per hour, or well over 
        $10,000 per year, and that, when combined with the Earned 
        Income Tax Credit and food stamps, the total income of former 
        AFDC families is at least $15,000 per year;
            (3) adults who leave AFDC for paid employment are on the 
        ladder that can lead to greater future income, and their 
        children have a role model for the societal value of self-
        sufficiency; and
            (4) most adult welfare recipients can find paid employment 
        within 2 years.
    (b) Intent of the Congress.--The intent of the Congress is to--
            (1) provide States with the resources and authority 
        necessary to help, cajole, lure, or force adults off welfare 
        and into paid employment as quickly as possible, and to require 
        adult welfare recipients, when necessary, to accept jobs that 
        will help end welfare dependency;
            (2) permit States to provide education and training to 
        welfare recipients only if, in the judgment of State officials, 
        doing so will enhance the ability of such recipients to leave 
        welfare for paid employment;
            (3) prohibit the States from providing adult welfare 
        recipients with more than 2 years of education or training; and
            (4) give States the flexibility to design their own 
        welfare-to-work programs and to decide who must participate in 
        such programs.
    (c) Statement of Purpose.--The purpose of this title is to move 
adult welfare recipients from welfare dependency to paid employment as 
quickly as possible.

SEC. 202. WORK PROGRAM.

    (a) In General.--Section 402(a) of the Social Security Act (42 
U.S.C. 602(a)) is amended by inserting the following after paragraph 
(28):
            ``(29) provide that--
                    ``(A)(i) the State shall require recipients of aid 
                under the State plan to participate in a work program 
                in accordance with this paragraph; and
                    ``(ii) for purposes of this paragraph, the term 
                `work program' means--
                            ``(I) a work supplementation program 
                        operated under section 482(e);
                            ``(II) a community work experience program 
                        established under section 482(f), or any other 
                        work experience program approved by the 
                        Secretary; or
                            ``(III) any other work program established 
                        by the State, which is approved by the 
                        Secretary;
                    ``(B)(i) except as provided in clause (ii), each 
                individual who is required under this paragraph to 
                participate in a work program and has received aid 
                under the State plan for at least 24 months (whether or 
                not consecutive) after the effective date of this 
                paragraph shall participate in work activities for an 
                average of not fewer than 35 hours per week during any 
                month (or for an average of not fewer than 30 hours per 
                week during any month if the individual is engaged in 
                job search for an average of not fewer than 5 hours per 
                week during the month), but the State may not require 
                any such individual to participate in work activities 
                for more than 40 hours during any week; and
                    ``(ii) in the case of a family which receives aid 
                under the State plan by reason of section 407--
                            ``(I) the State must require at least 1 
                        parent in the family to engage in work 
                        activities for an average of 32 hours per week 
                        during any month and in job search activities 
                        for an average of 8 hours per week during any 
                        month; and
                            ``(II) the State must combine the aid 
                        payable to the family under the plan, and the 
                        cash value of any benefits the State would have 
                        provided under title V of the Personal 
                        Responsibility Act of 1995 Act to the family, 
                        into a single cash payment to the family;
                    ``(C)(i)(I) the State may impose such sanctions as 
                the State considers appropriate on an individual who 
                fails to satisfactorily participate in any activity 
                required under this part during the first 24 months 
                (after the effective date of this paragraph) for which 
                the individual is a recipient of aid under the State 
                plan;
                    ``(II) the State shall reduce the amount otherwise 
                payable under the State plan for the month with respect 
                to an individual to whom subparagraph (B)(i) applies, 
                pro rata with respect to any period during the month 
                for which the individual does not comply with 
                subparagraph (B)(i); and
                    ``(III) in the case of a family which receives aid 
                under the State plan by reason of section 407, the 
                State shall reduce the cash payment payable to the 
                family pursuant to subparagraph (B)(ii) pro rata with 
                respect to any period for which the family does not 
                comply with subparagraph (B)(ii); and
                    ``(ii) the State may suspend or terminate 
                eligibility for aid under the State plan of any 
                individual to whom a sanction has been applied under 
                clause (i) on 3 or more occasions;
                    ``(D) the State may not provide subsidized non-work 
                activities to an individual under the State plan for 
                more than 24 months (whether or not consecutive) after 
                the effective date of this paragraph;
                    ``(E) at the option of the State, the State may 
                terminate eligibility for aid under the State plan of 
                any family which--
                            ``(i) has received such aid for 24 months 
                        (whether or not consecutive) after the 
                        effective date of this paragraph;
                            ``(ii) has been required under this 
                        paragraph for at least 12 months (whether or 
                        not consecutive) after such effective date to 
                        participate in a work program; and
                            ``(iii) was offered a work placement at the 
                        beginning of such 12-month period;
                    ``(F) an adult who has received aid under the State 
                plan for 60 months (whether or not consecutive) after 
                the effective date of this paragraph shall not be 
                eligible for aid under the State plan; and
                    ``(G) if a family is denied aid under the State 
                plan by reason of subparagraph (E) or (F), each member 
                of the family shall be considered to be receiving such 
                aid for purposes of eligibility for medical assistance 
                under the State plan approved under title XIX for so 
                long as the family would otherwise be eligible for such 
                aid.''.
    (b) Payments to States; Sanctions.--Section 403 of such Act (42 
U.S.C. 603) is amended by adding at the end the following:
    ``(o)(1) Each State which has been paid under subsection (l) of 
this section for any fiscal year an amount equal to the limitation 
determined under subsection (k)(2) of this section for the fiscal year 
shall be entitled to payments under paragraph (4) of this subsection 
for the fiscal year in an amount equal to the lesser of--
            ``(A) the sum of the applicable percentages (specified in 
        such paragraph (4)) of its expenditures under section 
        402(a)(29) with respect to which payment has not been made 
        under such subsection (l) (subject to limitations prescribed by 
        or pursuant to part F (to the extent applicable) or such 
        paragraph (4) on expenditures that may be included for purposes 
        of determining payment under such paragraph (4)); or
            ``(B) the limitation determined under paragraph (2) of this 
        subsection with respect to the State for the fiscal year.
    ``(2) The limitation determined under this paragraph with respect 
to a State for any fiscal year is the amount that bears the same ratio 
to the amount specified in paragraph (3) of this subsection for the 
fiscal year as the average monthly number of adult recipients (as 
defined in subsection (k)(4)) in the State in the preceding fiscal year 
bears to the average monthly number of such recipients in all the 
States for such preceding year.
    ``(3) The amount specified in this paragraph is--
            ``(A) $500,000,000 for fiscal year 1996;
            ``(B) $900,000,000 for fiscal year 1997;
            ``(C) $1,800,000,000 for fiscal year 1998;
            ``(D) $2,700,000,000 for fiscal year 1999; and
            ``(E) $4,000,000,000 for fiscal year 2000.
    ``(4) Each State which has been paid under subsection (l) of this 
section for a fiscal year an amount equal to the limitation determined 
under subsection (k)(2) of this section for the fiscal year shall, in 
addition to any payment under subsection (a) or (l) of this section, be 
entitled to payment from the Secretary of an amount equal to--
            ``(A) 50 percent of the expenditures of the State for 
        administrative costs incurred under section 402(a)(29) during 
        the fiscal year (other than personnel costs for staff employed 
        to carry out section 402(a)(29)) with respect to which payment 
        has not been made under such subsection (l); and
            ``(B) the greater of 70 percent or the Federal medical 
        assistance percentage (as defined in section 1118 in the case 
        of a State to which section 1108 applies, or as defined in 
        section 1905(b) in the case of any other State) of the other 
        expenditures of the State incurred in carrying out section 
        402(a)(29) during the fiscal year with respect to which payment 
        has not been made under such subsection (l).
    ``(p)(1) The Secretary shall reduce by 25 percent the amount 
otherwise payable under subsection (o) to a State for each quarter in a 
fiscal year if--
            ``(A) the State's participation rate for the 3rd quarter of 
        the immediately preceding fiscal year is less than the 
        participation rate set forth in paragraph (3) for the 
        immediately preceding fiscal year; or
            ``(B) for more than 2 months in the immediately preceding 
        fiscal year, the State's participation rate for the month is 
        less than the participation rate set forth in paragraph (3) for 
        the 2nd preceding fiscal year.
    ``(2)(A) A State's participation rate for a time period shall be--
            ``(i) the number of individuals receiving aid under the 
        State plan approved under this part who, during the time 
        period, participated in a work program (within the meaning of 
        section 402(a)(29)(A)) for an average of not fewer than 35 
        hours per week during the time period (or for an average of not 
        fewer than 30 hours per week during the time period if the 
        individual is engaged in job search for an average of not fewer 
        than 5 hours per week during the time period); divided by
            ``(ii) the number of families receiving aid under the State 
        plan approved under this part for the time period.
    ``(B) For purposes of subparagraph (A), in the case of an 
individual who received aid under the State plan approved under this 
part for only a portion of a time period, the conduct of the individual 
during that portion of the time period is deemed to have occurred 
throughout the time period.
    ``(3) The participation rate set forth in this paragraph is--
            ``(A) 2 percent, for fiscal year 1996;
            ``(B) 4 percent, for fiscal year 1997;
            ``(C) 8 percent, for fiscal year 1998;
            ``(D) 12 percent, for fiscal year 1999;
            ``(E) 17 percent, for fiscal year 2000;
            ``(F) 29 percent, for fiscal year 2001;
            ``(G) 40 percent, for fiscal year 2002; and
            ``(H) 50 percent, for fiscal year 2003 and each succeeding 
        fiscal year.
    ``(4)(A) Before the beginning of each fiscal year, the Secretary 
shall determine the number of individuals each State is required to 
have participating in a work program pursuant to section 402(a)(29), 
based on information from the immediately preceding fiscal year and on 
any information submitted under subparagraph (B) of this paragraph.
    ``(B) If the number of individuals eligible for aid under the State 
plan approved under this part during the 1st 3 quarters of a fiscal 
year is less than such number for the 1st 3 quarters of the immediately 
preceding fiscal year, then, not later than the 1st day of the 
succeeding fiscal year, the State may submit to the Secretary 
information documenting the decline.
    ``(C) At the beginning of each fiscal year, the Secretary shall 
publish in the Federal Register the number determined pursuant to 
subparagraph (A) for each State for the fiscal year.''.
    (c) Other Provisions Relating to Unemployed Parents.--
            (1) Extension to all states of option to limit afdc-up 
        program.--
                    (A) In general.--Section 407(b)(2)(B) of such Act 
                (42 U.S.C. 607(b)(2)(B)) is amended by striking clause 
                (iii).
                    (B) Conforming amendment.--Section 407(b)(2)(B)(i) 
                of such Act (42 U.S.C. 607(b)(2)(B)(i)) is amended by 
                striking ``clauses (ii) and (iii)'' and inserting 
                ``clause (ii)''.
            (2) Increase in required work program participation rates 
        of unemployed parents.--Section 403(l)(4) of such Act (42 
        U.S.C. 603(l)(4)) is amended--
                    (A) by striking subparagraph (A);
                    (B) in subparagraph (B)--
                            (i) by striking ``subparagraph (A)'' and 
                        inserting ``section 402(a)(29)(B)(ii)(I)'';
                            (ii) in clause (iii), by striking ``and'';
                            (iii) in clause (iv), by striking ``each of 
                        the fiscal years 1997 and 1998.'' and inserting 
                        ``fiscal year 1997; and''; and
                            (iv) by adding at the end the following:
            ``(v) 90 percent in the case of the average of each month 
        in fiscal year 1998.'';
                    (C) in subparagraph (C)--
                            (i) in clause (i), by striking 
                        ``subparagraph (A)(i)'' and inserting ``section 
                        402(a)(29)(B)(ii)(I)''; and
                            (ii) in clause (ii), by striking 
                        ``subparagraph'' and inserting ``section''; and
                    (D) in subparagraph (D)--
                            (i) by striking ``subparagraph (A)'' each 
                        place such term appears and inserting ``section 
                        402(a)(29)(B)(ii)(I)'';
                            (ii) by inserting ``of this paragraph'' 
                        after ``subparagraph (B)''; and
                            (iii) by adding after and below the end the 
                        following:
``The Secretary may not, under this subparagraph, waive a penalty with 
respect to the same State more than once during any 5-year period.''.
    (d) Elimination of Certain JOBS Program Rules.--
            (1) Participation requirements.--Section 403(l) of such Act 
        (42 U.S.C. 603(l)) is amended by striking paragraphs (2) and 
        (3) and redesignating paragraph (4) as paragraph (2).
            (2) CWEP hours of work limitations.--Section 482(f) of such 
        Act (42 U.S.C. 682(f)) is amended--
                    (A) in paragraph (1), by striking subparagraph (B) 
                and redesignating subparagraph (C) as subparagraph (B); 
                and
                    (B) by striking paragraph (2) and redesignating 
                paragraphs (3) and (4) as paragraphs (2) and (3), 
                respectively.
            (3) Rules relating to exemptions.--Section 402(a)(19) of 
        such Act (42 U.S.C. 602(a)(19)) is amended by striking 
        subparagraphs (C) and (D), by redesignating subparagraphs (E) 
        and (F) as subparagraphs (C) and (D), respectively, and by 
        adding ``and'' at the end of subparagraph (C) (as so 
        redesignated).
            (4) Sanctions.--Section 402(a)(19) of such Act (42 U.S.C. 
        602(a)(19)) is amended by striking subparagraph (G).
            (5) Limitation on authority to compel acceptance of a 
        job.--Section 402(a)(19) of such Act (42 U.S.C. 602(a)(19)) is 
        amended by striking subparagraph (H).
            (6) Conforming amendments and repeal.--
                    (A) Section 402(a)(19)(B) of such Act (42 U.S.C. 
                602(a)(19)(B)) is amended--
                            (i) by striking ``--'' and all that follows 
                        through ``(i) the'' and inserting ``the'';
                            (ii) by striking ``subclause (I)'' and 
                        inserting ``clause (i)'';
                            (iii) by striking clauses (ii), (iii), and 
                        (iv);
                            (iv) by redesignating subclauses (I) and 
                        (II) as clauses (i) and (ii), respectively; and
                            (v) by moving clauses (i) and (ii) (as so 
                        redesignated) 2 ems to the left.
                    (B) Section 407(b)(1)(B) of such Act (42 U.S.C. 
                607(b)(1)(B)) is amended--
                            (i) by adding ``and'' at the end of clause 
                        (iii);
                            (ii) by striking ``; and'' at the end of 
                        clause (iv) and inserting a period; and
                            (iii) by striking clause (v).
                    (C) Section 482(g)(2) of such Act (42 U.S.C. 
                682(g)) is amended by striking ``(other'' and all that 
                follows through ``applies)''.
                    (D) Section 486 of such Act (42 U.S.C. 686) is 
                hereby repealed.
                    (E) Section 487(a)(1) of such Act (42 U.S.C. 
                687(a)(1)) is amended by inserting ``(as in effect 
                immediately before the effective date of the Personal 
                Responsibility Act of 1995)'' before the semicolon.
    (e) Sense of the Congress.--Each State that operates a program of 
aid to families with dependent children under a plan approved under 
part A of title IV of the Social Security Act is encouraged to assign 
the highest priority to requiring families that include older preschool 
or school-age children to participate in a work program in accordance 
with section 402(a)(29) of such Act.

SEC. 203. WORK SUPPLEMENTATION PROGRAM AMENDMENTS.

    (a) Authority of States To Assign Participants to Unfilled Jobs.--
Section 484(c) of the Social Security Act (42 U.S.C. 684(c)) is amended 
by striking the last sentence.
    (b) Authority of States To Use Sums That Would Otherwise Be 
Expended for Food Stamp Benefits To Provide Subsidized Jobs for 
Participants.--
            (1) In general.--Section 482(e)(1) of such Act (42 U.S.C. 
        682(e)(1)) is amended--
                    (A) by inserting ``, and the sums that would 
                otherwise be used to provide participants in the 
                program under this subsection with benefits under title 
                V of the Personal Responsibility Act of 1995,'' before 
                ``and use''; and
                    (B) by inserting ``and the benefits under such 
                title that would otherwise be so provided to them'' 
                before the period.
            (2) Subsidies provided to employers and included in wages 
        of participants; minimum employer contribution.--Section 
        482(e)(3) of such Act (42 U.S.C. 682(e)(3)) is amended by 
        adding at the end the following:
    ``(E) Each State operating a work supplementation program under 
this subsection shall enter into an agreement with the employer who is 
to provide an eligible individual with a supplemented job under the 
program, under which--
            ``(i) the State is required to pay the employer an amount 
        specified in the agreement as the subsidized portion of the 
        wages of the eligible individual; and
            ``(ii) the employer is required to pay the eligible 
        individual wages which, when added to an amount that will be 
        payable as aid to families with dependent children to the 
        individual if the individual is paid such wages, are not less 
        than 100 percent of the sum of--
                    ``(I) the amount that would otherwise be payable as 
                aid to families with dependent children to the eligible 
                individual if the State did not have a work 
                supplementation program under this subsection in 
                effect; and
                    ``(II) if the State elects to subsidize jobs for 
                participants in the program through the reservation of 
                sums that would otherwise be used to provide such 
                participants with benefits under title V of the 
                Personal Responsibility Act of 1995, the cash value of 
                such benefits.
    ``(F) For purposes of computing the amount of the Federal payment 
to a State under paragraph (1) or (2) of section 403(a), for 
expenditures incurred in making payments to individuals and employers 
under the State's work supplementation program under this section, the 
State may claim as such expenditures the maximum amount payable to the 
State under paragraph (4) of this subsection.
    ``(G) Notwithstanding paragraph (1), a State may use for any 
purpose the sums reserved under paragraph (1) which are not used to 
subsidize jobs under this subsection attributable to savings achieved 
by operation of subparagraph (E).''.
            (3) Conforming amendment.--Section 482(e)(3)(A) of such Act 
        (42 U.S.C. 682(e)(3)(A)) is amended by striking the 2nd 
        sentence.

SEC. 204. PAYMENTS TO STATES FOR CERTAIN INDIVIDUALS RECEIVING FOOD 
              ASSISTANCE FROM THE STATE WHO PERFORM WORK ON BEHALF OF 
              THE STATE.

    (a) In General.--Each State (as defined in section 1101(a)(1) of 
the Social Security Act for purposes of title IV of such Act) shall be 
entitled to receive from the Secretary of Health and Human Services a 
monthly payment in an amount equal to--
            (1) $20 (as adjusted under subsection (b) of this section); 
        multiplied by
            (2) the number of nonexempt individuals (as defined in 
        section 504(7) of this Act) who, during the immediately 
        preceding month--
                    (A) received food assistance from the State under 
                title V of this Act; and
                    (B) performed at least 32 hours of work on behalf 
                of the State or a political subdivision of the State 
                through a work program (as defined in section 
                402(a)(29)(A)(i) of the Social Security Act).
    (b) Inflation Adjustment.--The Secretary of Health and Human 
Services shall adjust the amount referred to in subsection (a)(1) on 
October 1, 1996, and each October 1 thereafter, to reflect changes in 
the Consumer Price Index for All Urban Consumers published by the 
Bureau of Labor Statistics, as appropriately adjusted by the Bureau of 
Labor Statistics after consultation with the Secretary concerning the 
application of the Index to this paragraph, for the 12 months ending 
the immediately preceding June 30.

      TITLE III--CAPPING THE AGGREGATE GROWTH OF WELFARE SPENDING

SEC. 301. CAP ON GROWTH OF FEDERAL SPENDING ON CERTAIN WELFARE 
              PROGRAMS.

    (a) Restrictions on Spending.--(1) Effective for fiscal year 1996 
and any ensuing fiscal year, the total amount of Federal spending for 
that fiscal year for the programs listed in subsection (b) shall not 
exceed an amount equal to the sum of the total estimated Federal 
spending for the preceding fiscal year on those programs, adjusted for 
inflation and change of the poverty population as specified in 
paragraph (2).
    (2)(A) The inflator used in paragraph (1) shall be the percentage 
change in the Implicit Gross Domestic Product deflator published by the 
Department of Commerce for the most recently available fiscal year over 
the preceding fiscal year.
    (B) Change of the poverty population for purposes of paragraph (1) 
shall be the percentage by which the number of poor people in the 
United States in the most recent fiscal year for which data are 
available from the annual report on poverty published by the Bureau of 
the Census differs from the number of poor people in the preceding 
fiscal year, as computed by the Congressional Budget Office during 
January of the calendar year in which the fiscal year subject to the 
restriction begins.
    (b) Programs Subject to Spending Limit.--The programs listed in 
this subsection are the following:
            (1) Family support.--The program of aid and services to 
        needy families with children under part A of title IV of the 
        Social Security Act, child support enforcement program under 
        part D of such title, and the at-risk child care grant under 
        part A of such title.
            (2) Supplemental security income.--The supplemental 
        security income program under title XVI of the Social Security 
        Act.
            (3) Housing aid.--
                    (A) Lower income housing assistance under section 8 
                of the United States Housing Act of 1937 (42 U.S.C. 
                1772).
                    (B) Low-rent public housing under the United States 
                Housing Act of 1937.
                    (C) Rural housing loans for low-income families 
                under section 502 of the Housing Act of 1949.
                    (D) Interest reduction payments under section 236 
                of the National Housing Act.
                    (E) Rural rental housing loans under section 515 of 
                the Housing Act of 1949.
                    (F) Rural rental assistance under section 521 of 
                the Housing Act of 1949.
                    (G) Homeownership assistance for lower income 
                families under section 235 of the National Housing Act.
                    (H) Rent supplements under section 101 of the 
                Housing and Urban Development Act of 1965.
                    (I) Indian housing improvement grants under part 
                256 of title 25, Code of Federal Regulations.
                    (J) Rural housing repair loan grants for very low-
                income rural home owners under section 504 of the 
                Housing Act of 1949.
                    (K) Farm labor housing loans under section 514 of 
                the Housing Act of 1949.
                    (L) Rural housing self-help technical assistance 
                grants under section 523 of the Housing Act of 1949.
                    (M) Rural housing self-help technical assistance 
                loans under section 523 of the Housing Act of 1949.
                    (N) Farm labor housing grants under section 516 of 
                the Housing Act of 1949.
                    (O) Rural housing preservation grants for low-
                income rural homeowners under section 533 of the 
                Housing Act of 1949.
            (4) Mandatory work program.--The mandatory work program 
        under part A of title IV of the Social Security Act.
            (5) JOBS program.--The job opportunities and basic skills 
        training program under part F of title IV of the Social 
        Security Act.
    (c) Reconciliation of Growth Limits.--
            (1) Allocations.--The joint explanatory statement 
        accompanying a conference report on a concurrent resolution on 
        the budget described in section 301 of the Congressional Budget 
        Act of 1974 for a fiscal year shall include allocations to each 
        committee based on the spending cap imposed by subsection (a) 
        for such fiscal year.
            (2) Reconciliation directives.--The reconciliation 
        directives described in section 310 of the Congressional Budget 
        Act of 1974 shall specify reductions for each committee 
        necessary to comply with the spending caps imposed by 
        subsection (a) for such fiscal year.
            (3) Consultation with committees.--In conducting any 
        activities required under paragraphs (1) and (2), the 
        Committees on the Budget of the House of Representatives and 
        the Senate shall consult with the following committees of 
        Congress, as applicable:
                    (A) The Committee on Appropriations of the House of 
                Representatives or the Senate.
                    (B) The Committee on Banking and Financial Services 
                of the House of Representatives or the Committee on 
                Banking, Housing, and Urban Affairs of the Senate.
                    (C) The Committee on Ways and Means of the House of 
                Representatives.
                    (D) The Committee on Finance of the Senate.

SEC. 302. CONVERSION OF FUNDING UNDER CERTAIN WELFARE PROGRAMS.

    Notwithstanding any other provision of law, effective October 1, 
1995, all entitlement of individuals to benefits established under the 
following programs, or of States to payments under such programs, is 
terminated:
            (1) Family support.--The program of aid and services to 
        needy families with children under part A of title IV of the 
        Social Security Act, the child support enforcement program 
        under part D of such title, and the at-risk child care grant 
        under part A of such title.
            (2) Supplemental security income.--The supplemental 
        security income program under title XVI of the Social Security 
        Act.

SEC. 303. SAVINGS FROM WELFARE SPENDING LIMITS TO BE USED FOR DEFICIT 
              REDUCTION.

    All savings to the Federal Government resulting from the spending 
cap imposed under section 301 shall be used for deficit reduction. Such 
savings shall not be used to fund increased spending under any programs 
that are not subject to the spending cap.

                TITLE IV--RESTRICTING WELFARE FOR ALIENS

SEC. 401. INELIGIBILITY OF ALIENS FOR PUBLIC WELFARE ASSISTANCE.

    (a) In General.--Notwithstanding any other provision of law and 
except as provided in subsections (b) and (c), no alien shall be 
eligible for any program referred to in subsection (d).
    (b) Exceptions.--
            (1) Refugee exception.--Subsection (a) shall not apply to 
        an alien admitted to the United States as a refugee under 
        section 207 of the Immigration and Nationality Act until 6 
        years after the date of such alien's arrival into the United 
        States.
            (2) Aged exception.--Subsection (a) shall not apply to an 
        alien who--
                    (A) has been lawfully admitted to the United States 
                for permanent residence;
                    (B) is over 75 years of age; and
                    (C) has resided in the United States for at least 5 
                years.
            (3) Current resident exception.--Subsection (a) shall not 
        apply to the eligibility of an alien for a program referred to 
        in subsection (d) until 1 year after the date of the enactment 
        of this Act if, on such date of enactment, the alien is 
        residing in the United States and is eligible for the program.
    (c) Program For Which Aliens May Be Eligible.--The limitation under 
subsection (a) shall not apply to medical assistance with respect to 
emergency services (as defined for purposes of section 1916(a)(2)(D) of 
the Social Security Act).
    (d) Programs For Which Aliens Are Ineligible.--The programs 
referred to in this subsection are the following:
            (1) The program of medical assistance under title XIX of 
        the Social Security Act, except emergency services as provided 
        in subsection (c).
            (2) The Maternal and Child Health Services Block Grant 
        Program under title V of the Social Security Act.
            (3) The program established in section 330 of the Public 
        Health Service Act (relating to community health centers).
            (4) The program established in section 1001 of the Public 
        Health Service Act (relating to family planning methods and 
        services).
            (5) The program established in section 329 of the Public 
        Health Service Act (relating to migrant health centers).
            (6) The program of aid and services to needy families with 
        children under part A of title IV of the Social Security Act.
            (7) The child welfare services program under part B of 
        title IV of the Social Security Act.
            (8) The supplemental security income program under title 
        XVI of the Social Security Act.
            (9) The program of foster care and adoption assistance 
        under part E of title IV of the Social Security Act.
            (10) The food assistance block grant program established 
        under title V of this Act.
            (11) The program of rental assistance on behalf of low-
        income families provided under section 8 of the United States 
        Housing Act of 1937 (42 U.S.C. 1437f).
            (12) The program of assistance to public housing under 
        title I of the United States Housing Act of 1937 (42 U.S.C. 
        1437 et seq.).
            (13) The loan program under section 502 of the Housing Act 
        of 1949 (42 U.S.C. 1472).
            (14) The program of interest reduction payments pursuant to 
        contracts entered into by the Secretary of Housing and Urban 
        Development under section 236 of the National Housing Act (12 
        U.S.C. 1715z-1).
            (15) The program of loans for rental and cooperative 
        housing under section 515 of the Housing Act of 1949 (42 U.S.C. 
        1485).
            (16) The program of rental assistance payments pursuant to 
        contracts entered into under section 521(a)(2)(A) of the 
        Housing Act of 1949 (42 U.S.C. 1490a(a)(2)(A)).
            (17) The program of assistance payments on behalf of 
        homeowners under section 235 of the National Housing Act (12 
        U.S.C. 1715z).
            (18) The program of rent supplement payments on behalf of 
        qualified tenants pursuant to contracts entered into under 
        section 101 of the Housing and Urban Development Act of 1965 
        (12 U.S.C. 1701s).
            (19) The loan and grant programs under section 504 of the 
        Housing Act of 1949 (42 U.S.C. 1474) for repairs and 
        improvements to rural dwellings.
            (20) The loan and assistance programs under sections 514 
        and 516 of the Housing Act of 1949 (42 U.S.C. 1484, 1486) for 
        housing for farm labor.
            (21) The program of grants for preservation and 
        rehabilitation of housing under section 533 of the Housing Act 
        of 1949 (42 U.S.C. 1490m).
            (22) The program of grants and loans for mutual and self-
        help housing and technical assistance under section 523 of the 
        Housing Act of 1949 (42 U.S.C. 1490c).
            (23) The program of site loans under section 524 of the 
        Housing Act of 1949 (42 U.S.C. 1490d).
            (24) The program under part B of title IV of the Higher 
        Education Act of 1965.
            (25) The program under subpart 1 of part A of title IV of 
        the Higher Education Act of 1965.
            (26) The program under part C of title IV of the Higher 
        Education Act of 1965.
            (27) The program under subpart 3 of part A of title IV of 
        the Higher Education Act of 1965.
            (28) The program under part E of title IV of the Higher 
        Education Act of 1965.
            (29) The program under subpart 4 of part A of title IV of 
        the Higher Education Act of 1965.
            (30) The program under title IX of the Higher Education Act 
        of 1965.
            (31) The program under subpart 5 of part A of title IV of 
        the Higher Education Act of 1965.
            (32) The programs established in sections 338A and 338B of 
        the Public Health Service Act and the programs established in 
        part A of title VII of such Act (relating to loans and 
        scholarships for education in the health professions).
            (33) The program established in section 317(j)(1) of the 
        Public Health Service Act (relating to grants for immunizations 
        against vaccine-preventable diseases).
            (34) The program established in section 317A of the Public 
        Health Service Act (relating to grants for screening, 
        referrals, and education regarding lead poisoning in infants 
        and children).
            (35) The program established in part A of title XIX of the 
        Public Health Service Act (relating to block grants for 
        preventive health and health services).
            (36) The programs established in subparts I and II of part 
        B of title XIX of the Public Health Service Act.
            (37)(A) The program of training for disadvantaged adults 
        under part A of title II of the Job Training Partnership Act 
        (29 U.S.C. 1601 et seq.).
            (B) The program of training for disadvantaged youth under 
        part C of title II of the Job Training Partnership Act (29 
        U.S.C. 1641 et seq.).
            (38) The Job Corps program under part B of title IV of the 
        Job Training Partnership Act (29 U.S.C. 1692 et seq.).
            (39) The summer youth employment and training programs 
        under part B of title II of the Job Training Partnership Act 
        (29 U.S.C. 1630 et seq.).
            (40) The programs carried out under the Older American 
        Community Service Employment Act (42 U.S.C. 3001 et seq.).
            (41) The programs under title III of the Older Americans 
        Act of 1965.
            (42) The programs carried out under part B of title II of 
        the Domestic Volunteer Service Act of 1973 (42 U.S.C. 5011-
        5012).
            (43) The programs carried out under part C of title II of 
        the Domestic Volunteer Service Act of 1973 (42 U.S.C. 5013).
            (44) The program under the Low-Income Energy Assistance Act 
        of 1981 (42 U.S.C. 8621 et seq.).
            (45) The weatherization assistance program under title IV 
        of the Energy Conservation and Production Act (42 U.S.C. 6851).
            (46) The program of block grants to States for social 
        services under title XX of the Social Security Act.
            (47) The programs carried out under the Community Services 
        Block Grant Act (42 U.S.C. 9901 et seq.).
            (48) The program of legal assistance to eligible clients 
        and other programs under the Legal Services Corporation Act (42 
        U.S.C. 2996 et seq.).
            (49) The program for emergency food and shelter grants 
        under title III of the Stewart B. McKinney Homeless Assistance 
        Act (42 U.S.C. 11331 et seq.).
            (50) The programs carried out under the Child Care and 
        Development Block Grant Act of 1990 (42 U.S.C. 9858 et seq.).
            (51) A State program for providing child care under section 
        402(i) of the Social Security Act.
            (52) The program of State legalization impact-assistance 
        grants (SLIAG) under section 204 of the Immigration Reform and 
        Control Act of 1986.
    (e) Notification.--Each Federal agency that administers a program 
referred to in subsection (d) shall, directly or through the States, 
post information and provide general notification to the public and 
program recipients of the changes regardingly eligibility for any such 
program pursuant to this section.

SEC. 402. STATE AFDC AGENCIES REQUIRED TO PROVIDE INFORMATION ON 
              ILLEGAL ALIENS TO THE IMMIGRATION AND NATURALIZATION 
              SERVICE.

    Section 402(a) of the Social Security Act (42 U.S.C. 602(a)), as 
amended by title I of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (48);
            (2) by striking the period at the end of paragraph (49) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (49) the following:
            ``(50) require the State agency to provide to the 
        Immigration and Naturalization Service the name, address, and 
        other identifying information that the agency has with respect 
        to any individual unlawfully in the United States any of whose 
        children is a citizen of the United States.''.

            TITLE V--CONSOLIDATING FOOD ASSISTANCE PROGRAMS

SEC. 501. FOOD ASSISTANCE BLOCK GRANT PROGRAM.

    (a) Authority To Make Block Grants.--The Secretary of Agriculture 
shall make grants in accordance with this section to States to provide 
food assistance to individuals who are economically disadvantaged and 
to individuals who are members of economically disadvantaged families.
    (b) Distribution of Funds.--
            (1) Allotments to states.--Subject to paragraph (2), the 
        funds appropriated to carry out this section for any fiscal 
        year shall be allotted among the States as follows:
                    (A) Of the aggregate amount to be distributed under 
                this section, .21 percent shall be reserved for grants 
                to Guam, the Virgin Islands of the United States, 
                American Samoa, the Commonwealth of the Northern 
                Mariana Islands, the Republic of the Marshall Islands, 
                the Federated States of Micronesia, and Palau.
                    (B) Of the aggregate amount to be distributed under 
                this section, .24 percent shall be reserved for grants 
                to tribal organizations that have governmental 
                jurisdiction over geographically defined areas and 
                shall be allocated equitably by the Secretary among 
                such organizations.
                    (C) The remainder of such aggregate amount shall be 
                allocated among the remaining States. The amount 
                allocated to each of the remaining States shall bear 
                the same proportion to such remainder as the number of 
                resident individuals in such State who are economically 
                disadvantaged separately or as members of economically 
                disadvantaged families bears to the aggregate number of 
                resident individuals in all such remaining States who 
                are economically disadvantaged separately or as members 
of economically disadvantaged families.
            (2) Limitation.--After September 30, 1996, the aggregate 
        amount allotted under paragraph (1) for any fiscal year shall 
        not exceed the aggregate amount allotted under paragraph (1) 
        for the then preceding fiscal year adjusted by the Secretary to 
        reflect--
                    (A) the percentage change in population during the 
                1-year period ending June 30 of such preceding fiscal 
                year, determined on the basis of the most current 
                information available in the Current Population 
                Reports, P25 series (as adjusted to include overseas 
                members of the armed forces of the United States), 
                published by the Bureau of the Census, and
                    (B) the percentage change in the food at home 
                component of the Consumer Price Index For All Urban 
                Consumers for the 1-year period ending May 31 of such 
                preceding fiscal year.
    (c) Eligibility To Receive Grants.--To be eligible to receive a 
grant in the amount allotted to a State for a fiscal year, such State 
shall submit to the Secretary an application in such form, and 
containing such information and assurances, as the Secretary may 
require by rule, including--
            (1) an assurance that such grant will be expended by the 
        State to provide food assistance to resident individuals in 
        such State who are economically disadvantaged separately or as 
        members of economically disadvantaged families,
            (2) an assurance that not more than 5 percent of such grant 
        will be expended by the State for administrative costs incurred 
        to provide assistance under this section,
            (3) an assurance that not less than 12 percent of each 
        grant received from funds allotted for fiscal years 1996 
        through 2000 will be expended to provide food assistance and 
        nutrition education to pregnant women, postpartum women, 
        breastfeeding women, infants, and young children,
            (4) an assurance that not less than 20 percent of each 
        grant received from funds allotted for fiscal years 1996 
        through 2000 will be expended to provide--
                    (A) nonprofit school breakfast programs for 
                students from economically disadvantaged families,
                    (B) milk in nonprofit schools and in nonprofit 
                nursery schools, child care centers, settlement houses, 
                summer camps, and similar institutions devoted to the 
                care and training of children, to children from 
                economically disadvantaged families,
                    (C) nonprofit school lunch programs for students 
                from economically disadvantaged families,
                    (D) expanded food service programs in institutions 
                providing child care for children from economically 
                disadvantaged families, and
                    (E) summer food service programs carried out by 
                nonprofit food authorities, local governments, 
                nonprofit higher education institutions participating 
                in the National Youth Sports Program, and residential 
                nonprofit summer camps, to provide meals to children 
                from economically disadvantaged families; and
            (5) an assurance that the amount of food assistance that 
        will be provided to any nonexempt individual who is otherwise 
        eligible to receive such assistance will be reduced 
        proportionally to reflect the extent to which the individual 
        has not performed 32 hours of work on behalf of a State or a 
        political subdivision of a State, through a program established 
        by the State or political subdivision, during the month 
        preceding the month for which such assistance is provided.
    (d) Authority To Reduce Certain Grants Requirements.--At the 
request of a State for a particular fiscal year, the Secretary may 
reduce a percentage requirement specified in paragraph (3) or (4) of 
subsection (c) if the Secretary determines that the purpose described 
in such paragraph will be adequately carried out by such State without 
expending the full amount of funds required by such paragraph.
    (e) Limitation.--No State or political subdivision of a State that 
receives funds provided under this title shall replace any employed 
worker with an individual who is participating in a program described 
in subsection (c)(5) for the purpose of complying with such subsection. 
Such an individual may be placed in any position offered by the State 
or political subdivision that--
            (A) is a new position,
            (B) is a position that became available in the normal 
        course of conducting the business of the State or political 
        subdivision,
            (C) involves performing work that would otherwise be 
        performed on an overtime basis by a worker who is not an 
individual participating in such program, or
            (D) that is a position which became available by shifting a 
        current employee to an alternate position.
    (f) Authorization of Appropriations.--(1) There are authorized to 
be appropriated to carry out this section $35,600,000,000 for fiscal 
year 1996 and such sums as may be necessary for fiscal years 1997, 
1998, 1999, and 2000.
    (2) For the purpose of affording adequate notice of funding 
available under this section, an appropriation to carry out this 
section is authorized to be included in an appropriation Act for the 
fiscal year preceding the fiscal year for which such appropriation is 
available for obligation.

SEC. 502. AVAILABILITY OF FEDERAL COUPON SYSTEM TO STATES.

    (a) Issuance, Purchase, and Use of Coupons.--The Secretary shall 
issue, and make available for purchase by States, coupons for the 
retail purchase of food from retail food stores that are approved in 
accordance with subsection (b). Coupons issued, purchased, and used as 
provided in this section shall be redeemable at face value by the 
Secretary through the facilities of the Treasury of the United States. 
The purchase price of each coupon issued under this subsection shall be 
the face value of such coupon.
    (b) Approval of Retail Food Stores and Wholesale Food Concerns.--
(1) Regulations issued pursuant to this section shall provide for the 
submission of applications for approval by retail food stores and 
wholesale food concerns which desire to be authorized to accept and 
redeem coupons under this section. In determining the qualifications of 
applicants, there shall be considered among such other factors as may 
be appropriate, the following:
            (A) The nature and extent of the food business conducted by 
        the applicant.
            (B) The volume of coupon business which may reasonably be 
        expected to be conducted by the applicant food store or 
        wholesale food concern.
            (C) The business integrity and reputation of the applicant.
Approval of an applicant shall be evidenced by the issuance to such 
applicant of a nontransferable certificate of approval. The Secretary 
is authorized to issue regulations providing for a periodic 
reauthorization of retail food stores and wholesale food concerns.
    (2) A buyer or transferee (other than a bona fide buyer or 
transferee) of a retail food store or wholesale food concern that has 
been disqualified under subsection (d) may not accept or redeem coupons 
until the Secretary receives full payment of any penalty imposed on 
such store or concern.
    (3) Regulations issued pursuant to this section shall require an 
applicant retail food store or wholesale food concern to submit 
information which will permit a determination to be made as to whether 
such applicant qualifies, or continues to qualify, for approval under 
this section or the regulations issued pursuant to this section. 
Regulations issued pursuant to this section shall provide for 
safeguards which limit the use or disclosure of information obtained 
under the authority granted by this subsection to purposes directly 
connected with administration and enforcement of this section or the 
regulations issued pursuant to this section, except that such 
information may be disclosed to and used by States that purchase such 
coupons.
    (4) Any retail food store or wholesale food concern which has 
failed upon application to receive approval to participate in the food 
stamp program may obtain a hearing on such refusal as provided in 
subsection (f).
    (c) Redemption of Coupons.--Regulations issued under this section 
shall provide for the redemption of coupons accepted by retail food 
stores through approved wholesale food concerns or through financial 
institutions which are insured by the Federal Deposit Insurance 
Corporation, or which are insured under the Federal Credit Union Act 
(12 U.S.C. 1751 et seq.) and have retail food stores or wholesale food 
concerns in their field of membership, with the cooperation of the 
Treasury Department, except that retail food stores defined in section 
504(10)(D) shall be authorized to redeem their members' food coupons 
prior to receipt by the members of the food so purchased, and publicly 
operated community mental health centers or private nonprofit 
organizations or institutions which serve meals to narcotics addicts or 
alcoholics in drug addiction or alcoholic treatment and rehabilitation 
programs, public and private nonprofit shelters that prepare and serve 
meals for battered women and children, public or private nonprofit 
group living arrangements that serve meals to disabled or blind 
residents, and public or private nonprofit establishments, or public or 
private nonprofit shelters that feed individuals who do not reside in 
permanent dwellings and individuals who have no fixed mailing addresses 
shall not be authorized to redeem coupons through financial 
institutions which are insured by the Federal Deposit Insurance 
Corporation or the Federal Credit Union Act. No financial institution 
may impose on or collect from a retail food store a fee or other charge 
for the redemption of coupons that are submitted to the financial 
institution in a manner consistent with the requirements, other than 
any requirements relating to cancellation of coupons, for the 
presentation of coupons by financial institutions to the Federal 
Reserve banks.
    (d) Civil Money Penalties and Disqualification of Retail Food 
Stores and Wholesale Food Concerns.--(1) Any approved retail food store 
or wholesale food concern may be disqualified for a specified period of 
time from further participation in the coupon program under this 
section, or subjected to a civil money penalty of up to $10,000 for 
each violation if the Secretary determines that its disqualification 
would cause hardship to individuals who receive coupons, on a finding, 
made as specified in the regulations, that such store or concern has 
violated this section or the regulations issued pursuant to this 
section.
    (2) Disqualification under paragraph (1) shall be--
            (A) for a reasonable period of time, of no less than 6 
        months nor more than 5 years, upon the first occasion of 
        disqualification,
            (B) for a reasonable period of time, of no less than 12 
        months nor more than 10 years, upon the second occasion of 
        disqualification, and
            (C) permanent upon--
                    (i) the third occasion of disqualification,
                    (ii) the first occasion or any subsequent occasion 
                of a disqualification based on the purchase of coupons 
                or trafficking in coupons by a retail food store or 
                wholesale food concern, except that the Secretary shall 
                have the discretion to impose a civil money penalty of 
                up to $20,000 for each violation (except that the 
                amount of civil money penalties imposed for violations 
                occurring during a single investigation may not exceed 
                $40,000) in lieu of disqualification under this 
                subparagraph, for such purchase of coupons or 
                trafficking in coupons that constitutes a violation of 
                this section or the regulations issued pursuant to this 
                section, if the Secretary determines that there is 
                substantial evidence (including evidence that neither 
                the ownership nor management of the store or food 
                concern was aware of, approved, benefited from, or was 
                involved in the conduct or approval of the violation) 
                that such store or food concern had an effective policy 
                and program in effect to prevent violations of this 
                section and such regulations, or
                    (iii) a finding of the sale of firearms, 
                ammunition, explosives, or controlled substance (as 
                defined in section 802 of title 21, United States Code) 
                for coupons, except that the Secretary shall have the 
                discretion to impose a civil money penalty of up to 
                $20,000 for each violation (except that the amount of 
                civil money penalties imposed for violations occurring 
                during a single investigation may not exceed $40,000) 
                in lieu of disqualification under this subparagraph if 
                the Secretary determines that there is substantial 
                evidence (including evidence that neither the ownership 
                nor management of the store or food concern was aware 
                of, approved, benefited from, or was involved in the 
                conduct or approval of the violation) that the store or 
                food concern had an effective policy and program in 
                effect to prevent violations of this section.
    (3) The action of disqualification or the imposition of a civil 
money penalty shall be subject to review as provided in subsection (f).
    (4) As a condition of authorization to accept and redeem coupons 
issued under subsection (a), the Secretary may require a retail food 
store or wholesale food concern which has been disqualified or 
subjected to a civil penalty pursuant to paragraph (1) to furnish a 
bond to cover the value of coupons which such store or concern may in 
the future accept and redeem in violation of this section. The 
Secretary shall, by regulation, prescribe the amount, terms, and 
conditions of such bond. If the Secretary finds that such store or 
concern has accepted and redeemed coupons in violation of this section 
after furnishing such bond, such store or concern shall forfeit to the 
Secretary an amount of such bond which is equal to the value of coupons 
accepted and redeemed by such store or concern in violation of this 
section. Such store or concern may obtain a hearing on such forfeiture 
pursuant to subsection (f).
    (5)(A) In the event any retail food store or wholesale food concern 
that has been disqualified under paragraph (1) is sold or the ownership 
thereof is otherwise transferred to a purchaser or transferee, the 
person or persons who sell or otherwise transfer ownership of the 
retail food store or wholesale food concern shall be subjected to a 
civil money penalty in an amount established by the Secretary through 
regulations to reflect that portion of the disqualification period that 
has not yet expired. If the retail food store or wholesale food concern 
has been disqualified permanently, the civil money penalty shall be 
double the penalty for a 10-year disqualification period, as calculated 
under regulations issued by the Secretary. The disqualification period 
imposed under paragraph (2) shall continue in effect as to the person 
or persons who sell or otherwise transfer ownership of the retail food 
store or wholesale food concern notwithstanding the imposition of a 
civil money penalty under this paragraph.
    (B) At any time after a civil money penalty imposed under 
subparagraph (A) has become final under subsection (f)(1), the 
Secretary may request the Attorney General of the United States to 
institute a civil action against the person or persons subject to the 
penalty in a district court of the United States for any district in 
which such person or persons are found, reside, or transact business to 
collect the penalty and such court shall have jurisdiction to hear and 
decide such action. In such action, the validity and amount of such 
penalty shall not be subject to review.
    (C) The Secretary may impose a fine against any retail food store 
or wholesale food concern that accepts coupons that are not accompanied 
by the corresponding book cover, other than the denomination of coupons 
used for making change as specified in regulations issued under this 
section. The amount of any such fine shall be established by the 
Secretary and may be assessed and collected separately in accordance 
with regulations issued under this section or in combination with any 
fiscal claim established by the Secretary. The Attorney General of the 
United States may institute judicial action in any court of competent 
jurisdiction against the store or concern to collect the fine.
    (6) The Secretary may impose a fine against any person not approved 
by the Secretary to accept and redeem coupons who violates this section 
or a regulation issued under this section, including violations 
concerning the acceptance of coupons. The amount of any such fine shall 
be established by the Secretary and may be assessed and collected in 
accordance with regulations issued under this section separately or in 
combination with any fiscal claim established by the Secretary. The 
Attorney General of the United States may institute judicial action in 
any court of competent jurisdiction against the person to collect the 
fine.
    (e) Collection and Disposition of Claims.--The Secretary shall have 
the power to determine the amount of and settle and adjust any claim 
and to compromise or deny all or part of any such claim or claims 
arising under this section or the regulations issued pursuant to this 
section, including, but not limited to, claims arising from fraudulent 
and nonfraudulent overissuances to recipients, including the power to 
waive claims if the Secretary determines that to do so would serve the 
purposes of this section. Such powers with respect to claims against 
recipients may be delegated by the Secretary to State agencies.
    (f) Administrative and Judicial Review.--(1) Whenever--
            (A) an application of a retail food store or wholesale food 
        concern for approval to accept and redeem coupons issued under 
        subsection (a) is denied pursuant to this section,
            (B) a retail food store or wholesale food concern is 
        disqualified or subjected to a civil money penalty under 
        subsection (d),
            (C) all or part of any claim of a retail food store or 
        wholesale food concern is denied under subsection (e), or
            (D) a claim against a State is stated pursuant to 
        subsection (e),
notice of such administrative action shall be issued to the retail food 
store, wholesale food concern, or State involved. Such notice shall be 
delivered by certified mail or personal service. If such store, 
concern, or State is aggrieved by such action, it may, in accordance 
with regulations promulgated under this section, within 10 days of the 
date of delivery of such notice, file a written request for an 
opportunity to submit information in support of its position to such 
person or persons as the regulations may designate. If such a request 
is not made or if such store, concern, or State fails to submit 
information in support of its position after filing a request, the 
administrative determination shall be final. If such request is made by 
such store, concern, or State such information as may be submitted by 
such store, concern, or State as well as such other information as may 
be available, shall be reviewed by the person or persons designated by 
the Secretary, who shall, subject to the right of judicial review 
hereinafter provided, make a determination which shall be final and 
which shall take effect 30 days after the date of the delivery or 
service of such final notice of determination. If such store, concern, 
or State feels aggrieved by such final determination, it may obtain 
judicial review thereof by filing a complaint against the United States 
in the United States court for the district in which it resides or is 
engaged in business, or, in the case of a retail food store or 
wholesale food concern, in any court of record of the State having 
competent jurisdiction, within 30 days after the date of delivery or 
service of the final notice of determination upon it, requesting the 
court to set aside such determination. The copy of the summons and 
complaint required to be delivered to the official or agency whose 
order is being attacked shall be sent to the Secretary or such person 
or persons as the Secretary may designate to receive service of 
process. The suit in the United States district court or State court 
shall be a trial de novo by the court in which the court shall 
determine the validity of the questioned administrative action in 
issue. If the court determines that such administrative action is 
invalid, it shall enter such judgment or order as it determines is in 
accordance with the law and the evidence. During the pendency of such 
judicial review, or any appeal therefrom, the administrative action 
under review shall be and remain in full force and effect, unless on 
application to the court on not less than ten days' notice, and after 
hearing thereon and a consideration by the court of the applicant's 
likelihood of prevailing on the merits and of irreparable injury, the 
court temporarily stays such administrative action pending disposition 
of such trial or appeal.
    (g) Violations and Enforcement.--(1) Subject to paragraph (2), 
whoever knowingly uses, transfers, acquires, alters, or possesses 
coupons in any manner contrary to this section or the regulations 
issued pursuant to this section shall, if such coupons are of a value 
of $5,000 or more, be guilty of a felony and shall be fined not more 
than $250,000 or imprisoned for not more than 20 years, or both, and 
shall, if such coupons are of a value of $100 or more, but less than 
$5,000, be guilty of a felony and shall, upon the first conviction 
thereof, be fined not more than $10,000 or imprisoned for not more than 
5 years, or both, and, upon the second and any subsequent conviction 
thereof, shall be imprisoned for not less than 6 months nor more than 5 
years and may also be fined not more than $10,000 or, if such coupons 
are of a value of less than $100, shall be guilty of a misdemeanor, 
and, upon the first conviction thereof, shall be fined not more than 
$1,000 or imprisoned for not more than one year, or both, and upon the 
second and any subsequent conviction thereof, shall be imprisoned for 
not more than one year and may also be fined not more than $1,000.
    (2) In the case of any individual convicted of an offense under 
paragraph (1), the court may permit such individual to perform work 
approved by the court for the purpose of providing restitution for 
losses incurred by the United States and the State as a result of the 
offense for which such individual was convicted. If the court permits 
such individual to perform such work and such individual agrees 
thereto, the court shall withhold the imposition of the sentence on the 
condition that such individual perform the assigned work. Upon the 
successful completion of the assigned work the court may suspend such 
sentence.
    (3) Whoever presents, or causes to be presented, coupons for 
payment or redemption of the value of $100 or more, knowing the same to 
have been received, transferred, or used in any manner in violation of 
this section or the regulations issued under this section, shall be 
guilty of a felony and, upon the first conviction thereof, shall be 
fined not more than $20,000 or imprisoned for not more than 5 years, or 
both, and, upon the second and any subsequent conviction thereof, shall 
be imprisoned for not less than one year nor more than 5 years and may 
also be fined not more than $20,000, or, if such coupons are of a value 
of less than $100, shall be guilty of a misdemeanor and, upon the first 
conviction thereof, shall be fined not more than $1,000 or imprisoned 
for not more than one year, or both, and, upon the second and any 
subsequent conviction thereof, shall be imprisoned for not more than 
one year and may also be fined not more than $1,000.

SEC. 503. AUTHORITY TO SELL FEDERAL SURPLUS COMMODITIES.

    Notwithstanding any other provision of law, the Secretary of 
Agriculture and the Commodity Credit Corporation may sell surplus 
commodities and surplus foodstuffs to the States to provide food 
assistance to individuals who are economically disadvantaged and to 
individuals who are members of economically disadvantaged families.

SEC. 504. DEFINITIONS.

    For purposes of this title--
            (1) the term ``breastfeeding woman'' means women up to 1 
        year postpartum who are breastfeeding their infants,
            (2) the term ``coupon'' means any coupon, stamp, or type of 
        certificate, but does not include currency,
            (3) the term ``economically disadvantaged'' means an 
        individual or a family, as the case may be, whose income does 
        not exceed the most recent lower living standard income level 
        published by the Department of Labor,
            (4) the term ``elderly or disabled individual'' means an 
        individual who--
                    (A) is 60 years of age or older,
                    (B)(i) receives supplemental security income 
                benefits under title XVI of the Social Security Act (42 
                U.S.C. 1381 et seq.), or Federally or State 
                administered supplemental benefits of the type 
                described in section 212(a) of Public Law 93-66 (42 
                U.S.C. 1382 note), or
                    (ii) receives Federally or State administered 
                supplemental assistance of the type described in 
                section 1616(a) of the Social Security Act (42 U.S.C. 
                1382e(a)), interim assistance pending receipt of 
                supplemental security income, disability-related 
                medical assistance under title XIX of the Social 
                Security Act (42 U.S.C. 1396 et seq.), or disability-
                based State general assistance benefits, if the 
                Secretary determines that such benefits are conditioned 
                on meeting disability or blindness criteria at least as 
                stringent as those used under title XVI of the Social 
                Security Act,
                    (C) receives disability or blindness payments under 
                title I, II, X, XIV, or XVI of the Social Security Act 
                (42 U.S.C. 301 et seq.) or receives disability 
                retirement benefits from a governmental agency because 
                of a disability considered permanent under section 
                221(i) of the Social Security Act (42 U.S.C. 421(i)),
                    (D) is a veteran who--
                            (i) has a service-connected or non-service-
                        connected disability which is rated as total 
                        under title 38, United States Code, or
                            (ii) is considered in need of regular aid 
                        and attendance or permanently housebound under 
                        such title,
                    (E) is a surviving spouse of a veteran and--
                            (i) is considered in need of regular aid 
                        and attendance or permanently housebound under 
                        title 38, United States Code, or
                            (ii) is entitled to compensation for a 
                        service-connected death or pension benefits for 
                        a non-service-connected death under title 38, 
                        United States Code, and has a disability 
                        considered permanent under section 221(i) of 
                        the Social Security Act (42 U.S.C. 421(i)),
                    (F) is a child of a veteran and--
                            (i) is considered permanently incapable of 
                        self-support under section 414 of title 38, 
                        United States Code, or
                            (ii) is entitled to compensation for a 
                        service-connected death or pension benefits for 
                        a non-service-connected death under title 38, 
                        United States Code, and has a disability 
                        considered permanent under section 221(i) of 
                        the Social Security Act (42 U.S.C. 421(i)), or
                    (G) is an individual receiving an annuity under 
                section 2(a)(1)(iv) or 2(a)(1)(v) of the Railroad 
                Retirement Act of 1974 (45 U.S.C. 231a(a)(1)(iv) or 
                231a(a)(1)(v)), if the individual's service as an 
                employee under the Railroad Retirement Act of 1974, 
                after December 31, 1936, had been included in the term 
                ``employment'' as defined in the Social Security Act 
                (42 U.S.C. 301 et seq.), and if an application for 
                disability benefits had been filed,
            (5) the term ``food'' means, for purposes of section 502(a) 
        only--
                    (A) any food or food product for home consumption 
                except alcoholic beverages, tobacco, and hot foods or 
                hot food products ready for immediate consumption other 
                than those authorized pursuant to subparagraphs (C), 
                (D), (E), (G), (H), and (I),
                    (B) seeds and plants for use in gardens to produce 
                food for the personal consumption of the eligible 
                individuals,
                    (C) in the case of those persons who are 60 years 
                of age or over or who receive supplemental security 
                income benefits or disability or blindness payments 
                under title I, II, X, XIV, or XVI of the Social 
                Security Act (42 U.S.C. 301 et seq.), and their 
                spouses, meals prepared by and served in senior 
                citizens' centers, apartment buildings occupied 
                primarily by such persons, public or private nonprofit 
                establishments (eating or otherwise) that feed such 
                persons, private establishments that contract with the 
                appropriate agency of the State to offer meals for such 
                persons at concessional prices, and meals prepared for 
                and served to residents of federally subsidized housing 
                for the elderly,
                    (D) in the case of persons 60 years of age or over 
                and persons who are physically or mentally handicapped 
                or otherwise so disabled that they are unable 
                adequately to prepare all of their meals, meals 
                prepared for and delivered to them (and their spouses) 
                at their home by a public or private nonprofit 
                organization or by a private establishment that 
                contracts with the appropriate State agency to perform 
                such services at concessional prices,
                    (E) in the case of narcotics addicts or alcoholics, 
                and their children, served by drug addiction or 
                alcoholic treatment and rehabilitation programs, meals 
                prepared and served under such programs,
                    (F) in the case of eligible individuals living in 
                Alaska, equipment for procuring food by hunting and 
                fishing, such as nets, hooks, rods, harpoons, and 
                knives (but not equipment for purposes of 
                transportation, clothing, or shelter, and not firearms, 
                ammunition, and explosives) if the Secretary determines 
                that such individuals are located in an area of the 
                State where it is extremely difficult to reach stores 
                selling food and that such individuals depend to a 
                substantial extent upon hunting and fishing for 
                subsistence,
                    (G) in the case of disabled or blind recipients of 
                benefits under title I, II, X, XIV, or XVI of the 
                Social Security Act (42 U.S.C. 301 et seq.), or are 
                individuals described in subparagraphs (B) through (G) 
                of paragraph (4), who are residents in a public or 
                private nonprofit group living arrangement that serves 
                no more than 16 residents and is certified by the 
                appropriate State agency or agencies under regulations 
                issued under section 1616(e) of the Social Security Act 
                (42 U.S.C. 1382e(e)) or under standards determined by 
                the Secretary to be comparable to standards implemented 
                by appropriate State agencies under such section, meals 
                prepared and served under such arrangement,
                    (H) in the case of women and children temporarily 
                residing in public or private nonprofit shelters for 
                battered women and children, meals prepared and served, 
                by such shelters, and
                    (I) in the case of individuals that do not reside 
                in permanent dwellings and individuals that have no 
                fixed mailing addresses, meals prepared for and served 
                by a public or private nonprofit establishment 
                (approved by an appropriate State or local agency) that 
                feeds such individuals and by private establishments 
                that contract with the appropriate agency of the State 
                to offer meals for such individuals at concessional 
                prices,
            (6) the term ``infants'' means individuals under 1 year of 
        age,
            (7) the term ``nonexempt individual'' means an individual 
        who is not--
                    (A) a parent residing with a dependent child under 
                18 years of age,
                    (B) a member of a family with responsibility for 
                the care of an incapacitated family member,
                    (C) mentally or physically unfit,
                    (D) under 18 years of age, or
                    (E) 63 years of age or older,
            (8) the term ``postpartum women'' means women during the 
        180-day period after the end of their pregnancy,
            (9) the term ``pregnant women'' means women who have one or 
        more fetuses in utero,
            (10) the term ``retail food store'' means--
                    (A) an establishment or recognized department 
                thereof or house-to-house trade route, over 50 percent 
                of whose food sales volume, as determined by visual 
                inspection, sales records, purchase records, or other 
                inventory or accounting recordkeeping methods that are 
                customary or reasonable in the retail food industry, 
                consists of staple food items for home preparation and 
                consumption, such as meat, poultry, fish, bread, 
                cereals, vegetables, fruits, dairy products, and the 
                like, but not including accessory food items, such as 
                coffee, tea, cocoa, carbonated and uncarbonated drinks, 
                candy, condiments, and spices,
                    (B) an establishment, organization, program, or 
                group living arrangement referred to in subparagraph 
                (C), (D), (E), (G), (H), or (I) of paragraph (5),
                    (C) a store purveying the hunting and fishing 
                equipment described in paragraph (5)(F), or
                    (D) any private nonprofit cooperative food 
                purchasing venture, including those in which the 
                members pay for food purchased prior to the receipt of 
                such food,
            (11) the term ``school'' means an elementary, intermediate, 
        or secondary school,
            (12) the term ``Secretary'' means the Secretary of 
        Agriculture,
            (13) the term ``State'' means any of the several States, 
        the District of Columbia, the Commonwealth of Puerto Rico, 
        Guam, the Virgin Islands of the United States, American Samoa, 
        the Commonwealth of the Northern Mariana Islands, the Republic 
        of the Marshall Islands, the Federated States of Micronesia, 
        Palau, or a tribal organization that exercises governmental 
        jurisdiction over a geographically defined area,
            (14) the term ``tribal organization'' has the meaning given 
        it in section 4(l) of the Indian Self-Determination and 
        Education Assistance Act (25 U.S.C. 450b(l)), and
            (15) the term ``young children'' means individuals who are 
        not less than 1 year of age and not more than 5 years of age.

SEC. 505. REPEALERS; AMENDMENTS.

    (a) Repealers.--The following Acts are repealed:
            (1) The Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.).
            (2) The Child Nutrition Act of 1966 (42 U.S.C. 1771 et 
        seq.).
            (3) The National School Lunch Act (42 U.S.C. 1751 et seq.)
            (4) The Emergency Food Assistance Act of 1983 (7 U.S.C. 
        612c note).
            (5) The Hunger Prevention Act of 1988 (Public Law 100-435; 
        102 Stat. 1645).
            (6) The Commodity Distribution Reform Act and WIC 
        Amendments of 1987 (Public Law 100-237; 101 Stat. 1733).
            (7) The Child Nutrition and WIC Reauthorization Act of 1989 
        (Public Law 101-147; 103 Stat. 877).
    (b) Amendments.--
            (1) The Older Americans Act of 1965 (42 U.S.C. 3030a et 
        seq.) is amended by striking sections 303(b) and 311, and part 
        C of title III.
            (2) Section 32 of the Act of August 24, 1935 (Public Law 
        320; 7 U.S.C. 612C) is amended--
                    (A) in the first undesignated paragraph--
                            (i) by striking ``30 per centum'' and 
                        inserting ``1.5 per centum'', and
                            (ii) by striking ``; (2)'' and all that 
                        follows through ``Agriculture;'', and
                    (B) by striking the last sentence.
            (3) The Agriculture and Consumer Protection Act of 1973 (7 
        U.S.C. 612c note) is amended by striking sections 4 and 5.
            (4) The Agriculture and Food Act of 1981 (7 U.S.C. 1431) is 
        amended by striking section 1114.
            (5) Section 402 of the Mutual Security Act of 1954 (22 
        U.S.C. 1922) is amended by striking the last sentence.
            (6) The Act of September 6, 1958 (Public Law 83-931; 7 
        U.S.C. 1431b) is amended by striking section 9.
            (7) The Agricultural Act of 1965 (7 U.S.C. 1446a-1) is 
        amended by striking section 709.

SEC. 506. EFFECTIVE DATE; APPLICATION OF REPEALERS AND AMENDMENTS.

    (a) Effective Dates.--
            (1) General effective date.--Except as provided in 
        subsection (b), this title and the amendments made by this 
        title shall take effect on the date of the enactment of this 
        Act.
            (2) Special effective date.--The repeals made by section 
        505(a) shall not take effect until the first day of the first 
        fiscal year for which funds are appropriated more than 180 days 
        in advance of such fiscal year to carry out section 501.
    (b) Application of Repealers and Amendments.--A repeal or amendment 
made by section 505 shall not apply with respect to--
            (1) powers, duties, functions, rights, claims, penalties, 
        or obligations applicable to financial assistance provided 
        under the Act repealed or amended before the effective date of 
        such repeal or amendment, and
            (2) administrative actions and proceedings commenced before 
        such date, or authorized before such date to be commenced, 
        under such Acts.

          TITLE VI--EXPANDING STATUTORY FLEXIBILITY OF STATES

SEC. 601. OPTION TO CONVERT AFDC INTO A BLOCK GRANT PROGRAM.

    Section 403 of the Social Security Act (42 U.S.C. 603) is amended 
by inserting after subsection (b) the following:
    ``(c)(1) Any State that has in effect a plan approved under part D 
and is operating a child support program in substantial compliance with 
that plan may elect to receive payments under this subsection in lieu 
of receiving payments under the other subsections of this section.
    ``(2) If a State makes an election under paragraph (1), then, in 
lieu of any payment under any other subsection of this section, the 
Secretary shall make payments to the State under this subsection for 
each fiscal year in an amount equal to 103 percent of the total amount 
to which the State was entitled under this section for fiscal year 
1992, subject to paragraph (5).
    ``(3) Each State to which an amount is paid under paragraph (2) for 
a fiscal year shall expend the amount to carry out any program 
established by the State to provide benefits to needy families with 
dependent children.
    ``(4) Within 3 months after the end of each fiscal year, each State 
that has made an election under paragraph (1) shall submit to the 
Secretary a report that accounts for all expenditures of amounts paid 
to the State under this subsection for the fiscal year.
    ``(5) The Secretary shall reduce by 20 percent the amount that 
would otherwise be payable to a State under this subsection for a 
fiscal year if the Secretary finds that the State has expended any 
amount provided under this subsection for any purpose other than to 
carry out a program of cash benefits to needy families with children.
    ``(6)(A) The regulations issued with respect to State plans and the 
operation of State programs under this part (other than under section 
402(a)(27), section 403(h), and this subsection) shall not apply to any 
State that makes an election under paragraph (1).
    ``(B) Section 403(h) shall continue to apply to any State that 
makes an election under paragraph (1).''.

SEC. 602. OPTION TO TREAT NEW RESIDENTS OF A STATE UNDER RULES OF 
              FORMER STATE.

    Section 402(a) of the Social Security Act (42 U.S.C. 602(a)), as 
amended by titles I and IV of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (49);
            (2) by striking the period at the end of paragraph (50) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (50) the following:
            ``(51) at the option of the State, in the case of a family 
        applying for aid under the State plan that has moved to the 
        State from another jurisdiction of the United States that has a 
        plan approved under this part or has made an election under 
        section 403(c)(1), and has resided in the State for less than 
        12 months consecutively, apply the rules that would have been 
        applied by such other jurisdiction if the family had not moved 
        from such other jurisdiction, in determining the eligibility of 
        the family for benefits, and the amount of benefits payable to 
        the family, under the State plan.''.

SEC. 603. OPTION TO IMPOSE PENALTY FOR FAILURE TO ATTEND SCHOOL.

    Section 402(a) of the Social Security Act (42 U.S.C. 602(a)), as 
amended by titles I and IV, and section 602, of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (50);
            (2) by striking the period at the end of paragraph (51) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (51) the following:
            ``(52) at the option of the State, provide that the aid 
        otherwise payable under the plan to a family may be reduced by 
        not more than $75 per month for each parent under 21 years of 
        age who has not completed secondary school (or the equivalent) 
        and each dependent child in the family who, during the 
        immediately preceding month, has failed, without good cause (as 
        defined by the State in consultation with the Secretary), to 
        maintain minimum attendance (as defined by the State in 
        consultation with the Secretary) at an educational 
        institution.''.

SEC. 604. OPTION TO PROVIDE MARRIED COUPLE TRANSITION BENEFIT.

    (a) In General.--Section 402(a) of the Social Security Act (42 
U.S.C. 602(a)), as amended by titles I and IV, and sections 602 and 
603, of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (51);
            (2) by striking the period at the end of paragraph (52) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (52) the following:
            ``(53) at the option of the State, provide that--
                    ``(A) if a recipient of aid under the plan marries 
                an individual who is not a parent of a child of the 
                recipient and (but for this paragraph) the resulting 
                family would have become ineligible for such aid by 
                reason of the marriage, then the family shall remain 
                eligible for aid under the plan, in an amount equal to 
                50 percent of the aid payable to the recipient 
                immediately before the marriage, for a period 
                (specified by the State) of not more than 12 months, 
                but only for so long as the income of the family is 
                less than 150 percent of the income official poverty 
                line (as defined by the Office of Management and 
                Budget, and revised annually in accordance with section 
                673(2) of the Omnibus Budget Reconciliation Act of 
                1981) applicable to a family of the size involved; and
                    ``(B) if a recipient of aid under the plan marries 
                an individual who is not a parent of a child of the 
                recipient and the resulting family would (in the 
                absence of this subparagraph) be eligible for such aid 
                by reason of section 407, then the State may provide 
                aid to the family in accordance with section 407 or 
                subparagraph (A) of this paragraph, but not both.''.
    (b) Applicability.--The amendments made by subsection (a) shall 
apply only with respect to individuals who first become recipients of 
aid under State plans approved under part A of title IV of the Social 
Security Act on or after the effective date of this Act.

SEC. 605. OPTION TO DISREGARD INCOME AND RESOURCES DESIGNATED FOR 
              EDUCATION, TRAINING, AND EMPLOYABILITY, OR RELATED TO 
              SELF-EMPLOYMENT.

    (a) Resource Disregards.--Section 402(a)(7)(B) of the Social 
Security Act (42 U.S.C. 602(a)(7)(B)) is amended--
            (1) by striking ``or'' before ``(iv)''; and
            (2) by inserting ``(v) at the option of the State, in the 
        case of a family receiving aid under the State plan (and a 
        family not receiving such aid but which received such aid in at 
        least 1 of the preceding 4 months or became ineligible for such 
        aid during the preceding 12 months because of excessive 
        earnings), any amount (determined by the State) not to exceed 
        $10,000 in a qualified asset account (as defined in section 
        406(i)) of the family, or (vi) at the option of the State, the 
        first $10,000 of the net worth (assets reduced by liabilities 
        with respect thereto) of all microenterprises (as defined in 
        section 406(j)(1)) owned, in whole or in part, by such child, 
        relative, or other individual, for a period not to exceed 2 
        years'' before ``; and''.
    (b) Disregard of Income from Qualified Asset Accounts.--Section 
402(a)(8)(A) of such Act (42 U.S.C. 602(a)(8)(A)) is amended--
            (1) by striking ``and'' at the end of clause (vii); and
            (2) by inserting after clause (viii) the following new 
        clause:
                            ``(ix) at the option of the State, may 
                        disregard any interest or income earned on a 
                        qualified asset account (as defined in section 
                        406(i)), and any qualified distribution (as 
                        defined in section 406(i)(2)) from a qualified 
                        asset account (as defined in section 
                        406(i)(1)); and''.
    (c) Nonrecurring Lump Sum Exempt From Lump Sum Rule.--Section 
402(a)(17) of such Act (42 U.S.C. 602(a)(17)) is amended by adding at 
the end the following: ``; and, at the option of the State, that this 
paragraph shall not apply to earned or unearned income received in a 
month on a nonrecurring basis to the extent that such income is placed 
in a qualified asset account (as defined in section 406(i)) the total 
amounts in which, after such placement, does not exceed $10,000;''.
    (d) Only Net Profits of Microenterprise Treated as Income.--Section 
402(a)(7) of such Act (42 U.S.C. 602(a)(7)), as amended by subsection 
(a) of this section, is amended--
            (1) by striking ``and'' at the end of subparagraph (B);
            (2) by striking the semicolon at the end of subparagraph 
        (C) and inserting ``; and''; and
            (3) by adding at the end the following:
                    ``(D) at the option of the State, may take into 
                consideration as earned income of the family of which 
                the child is a member, only the net profits (as defined 
                in section 406(j)(2)) of microenterprises (as defined 
                in section 406(j)(1)) owned, in whole or in part, by 
                such child, relative, or other individual, for a period 
                not to exceed 2 years.''.
    (e) Definitions.--Section 406 of such Act (42 U.S.C. 606) is 
amended by adding at the end the following:
    ``(i)(1) The term `qualified asset account' means a mechanism 
approved by the State (such as individual retirement accounts, escrow 
accounts, or savings bonds) that allows savings of a family receiving 
aid to families with dependent children to be used for qualified 
distributions.
    ``(2) The term `qualified distribution' means a distribution from a 
qualified asset account for expenses directly related to 1 or more of 
the following purposes:
            ``(A) The attendance of a member of the family at any 
        education or training program.
            ``(B) The improvement of the employability (including self-
        employment) of a member of the family (such as through the 
        purchase of an automobile).
            ``(C) The purchase of a home for the family.
            ``(D) A change of the family residence.
    ``(j)(1) The term `microenterprise' means a commercial enterprise 
which has 5 or fewer employees, 1 or more of whom owns the enterprise.
    ``(2) The term `net profits' means, with respect to a 
microenterprise, the gross receipts of the business, minus--
            ``(A) payments of principal or interest on a loan to the 
        microenterprise;
            ``(B) transportation expenses;
            ``(C) inventory costs;
            ``(D) expenditures to purchase capital equipment;
            ``(E) cash retained by the microenterprise for future use 
        by the business;
            ``(F) taxes paid by reason of the business;
            ``(G) if the business is covered under a policy of 
        insurance against loss--
                    ``(i) the premiums paid for such insurance; and
                    ``(ii) the losses incurred by the business that are 
                not reimbursed by the insurer solely by reason of the 
                existence of a deductible with respect to the insurance 
                policy;
            ``(H) the reasonable costs of obtaining 1 motor vehicle 
        necessary for the conduct of the business; and
            ``(I) the other expenses of the business.''.

SEC. 606. OPTION TO REQUIRE ATTENDANCE AT PARENTING AND MONEY 
              MANAGEMENT CLASSES, AND PRIOR APPROVAL OF ANY ACTION THAT 
              WOULD RESULT IN A CHANGE OF SCHOOL FOR A DEPENDENT CHILD.

    (a) In General.--Section 402(a) of the Social Security Act (42 
U.S.C. 602(a)), as amended by titles I and IV, and sections 602, 603, 
and 604, of this Act, is amended--
            (1) by striking ``and'' at the end of paragraph (52);
            (2) by striking the period at the end of paragraph (53) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (53) the following:
            ``(54) at the option of the State, provide that, as a 
        condition of receiving aid under the State plan, the receipient 
        must attend parenting and money management classes, and must 
        receive the permission of the State agency before taking any 
        action that would require a change in the educational 
        institution attended by a dependent child of the recipient.''.

             TITLE VII--DRUG TESTING FOR WELFARE RECIPIENTS

SEC. 701. AFDC RECIPIENTS REQUIRED TO UNDERGO NECESSARY SUBSTANCE ABUSE 
              TREATMENT AS A CONDITION OF RECEIVING AFDC.

    (a) In General.--Section 402(a) of the Social Security Act (42 
U.S.C. 602(a)) is amended by inserting after paragraph (34) the 
following:
            ``(35) provide that--
                    ``(A) each applicant or recipient of aid under the 
                State plan who is addicted (as determined by the State) 
                to alcohol or drugs must agree to participate and 
                maintain satisfactory participation (as determined by 
                the State) in an appropriate addiction treatment 
                program (if available), and must agree to submit to 
                tests for the presence of alcohol or drugs, without 
                advance notice, during and after such participation; 
                and
                    ``(B) during the 2-year period that begins with any 
                failure by such an applicant or recipient to comply 
                with any requirement imposed pursuant to subparagraph 
                (A), the applicant or recipient shall not be eligible 
                for such aid, but shall be considered to be receiving 
                such aid for purposes of eligibility for medical 
                assistance under the State plan approved under title 
                XIX.''.
    (b) Delayed Applicability Permitted if State Legislation 
Required.--In the case of a State plan approved under section 402(a) of 
the Social Security Act which the Secretary of Health and Human 
Services determines requires State legislation (other than legislation 
appropriating funds) in order for the plan to meet the additional 
requirement imposed by the amendment made by subsection (a) of this 
section, the State plan shall not be regarded as failing to comply with 
the requirements of such section 402(a) solely on the basis of the 
failure of the plan to meet such additional requirement before the end 
of the 2-year period that begins with the effective date of this Act.

                       TITLE VIII--EFFECTIVE DATE

SEC. 801. EFFECTIVE DATE.

    This Act and the amendments made by this Act shall take effect on 
October 1, 1995.
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