[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 1120 Introduced in Senate (IS)]







104th CONGRESS
  1st Session
                                S. 1120

 To enhance support and work opportunities for families with children, 
        reduce welfare dependence, and control welfare spending.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

               August 3 (legislative day, July 10), 1995

    Mr. Dole (for himself, Mr. Packwood, Mr. Lott, Mr. Nickles, Mr. 
Cochran, Mr. Mack, Mr. D'Amato, Mr. Thurmond, Mr. Abraham, Mr. Bennett, 
 Mr. Bond, Mr. Brown, Mr. DeWine, Mr. Frist, Mr. Gorton, Mr. Grassley, 
   Mr. Gregg, Mr. Hatch, Mr. Helms, Mrs. Hutchison, Mr. Inhofe, Mr. 
   McCain, Mr. Murkowski, Mr. Pressler, Mr. Roth, Mr. Santorum, Mr. 
  Shelby, Mr. Simpson, Mr. Stevens, Mr. Thomas, Mr. Thompson, and Mr. 
    Warner) introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To enhance support and work opportunities for families with children, 
        reduce welfare dependence, and control welfare spending.
    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Work Opportunity 
Act of 1995''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
   TITLE I--BLOCK GRANTS FOR TEMPORARY ASSISTANCE FOR NEEDY FAMILIES

Sec. 100. References to Social Security Act.
Sec. 101. Block grants to States.
Sec. 102. Services provided by charitable, religious, or private 
                            organizations.
Sec. 103. Limitations on use of financial assistance for certain 
                            purposes.
Sec. 104. Continued application of current standards under medicaid 
                            program.
Sec. 105. Reduction in personnel.
Sec. 106. Conforming amendments to the Social Security Act.
Sec. 107. Conforming amendments to the food stamp act of 1977 and 
                            related provisions.
Sec. 108. Conforming amendments to other laws.
Sec. 109. Secretarial submission of legislative proposal for technical 
                            and conforming amendments.
Sec. 110. Effective date; transition rule.
                 TITLE II--SUPPLEMENTAL SECURITY INCOME

Sec. 200. Reference to Social Security Act.
                  Subtitle A--Eligibility Restrictions

Sec. 201. Denial of supplemental security income benefits by reason of 
                            disability to drug addicts and alcoholics.
Sec. 202. Denial of SSI benefits for 10 years to individuals found to 
                            have fraudulently misrepresented residence 
                            in order to obtain benefits simultaneously 
                            in 2 or more States.
Sec. 203. Denial of SSI benefits for fugitive felons and probation and 
                            parole violators.
Sec. 204. Effective dates; application to current recipients.
               Subtitle B--Benefits for Disabled Children

Sec. 211. Restrictions on eligibility for benefits.
Sec. 212. Continuing disability reviews.
Sec. 213. Treatment requirements for disabled individuals under the age 
                            of 18.
         Subtitle C--Study of Disability Determination Process

Sec. 221. Study of disability determination process.
      Subtitle D--National Commission on the Future of Disability

Sec. 231. Establishment.
Sec. 232. Duties of the Commission.
Sec. 233. Membership.
Sec. 234. Staff and support services.
Sec. 235. Powers of Commission.
Sec. 236. Reports.
Sec. 237. Termination.
               Subtitle E--State Supplementation Programs

Sec. 241. Repeal of maintenance of effort requirements applicable to 
                            optional State programs for supplementation 
                            of SSI benefits.
                     TITLE III--FOOD STAMP PROGRAM

                     Subtitle A--Food Stamp Reform

Sec. 301. Certification period.
Sec. 302. Treatment of children living at home.
Sec. 303. Optional additional criteria for separate household 
                            determinations.
Sec. 304. Adjustment of thrifty food plan.
Sec. 305. Definition of homeless individual.
Sec. 306. State options in regulations.
Sec. 307. Earnings of students.
Sec. 308. Energy assistance.
Sec. 309. Deductions from income.
Sec. 310. Amount of vehicle asset limitation.
Sec. 311. Benefits for aliens.
Sec. 312. Disqualification.
Sec. 313. Caretaker exemption.
Sec. 314. Employment and training.
Sec. 315. Comparable treatment for disqualification.
Sec. 316. Cooperation with child support agencies.
Sec. 317. Disqualification for child support arrears.
Sec. 318. Permanent disqualification for participating in 2 or more 
                            States.
Sec. 319. Work requirement.
Sec. 320. Electronic benefit transfers.
Sec. 321. Minimum benefit.
Sec. 322. Benefits on recertification.
Sec. 323. Optional combined allotment for expedited households.
Sec. 324. Failure to comply with other welfare and public assistance 
                            programs.
Sec. 325. Allotments for households residing in institutions.
Sec. 326. Operation of food stamp offices.
Sec. 327. State employee and training standards.
Sec. 328. Exchange of law enforcement information.
Sec. 329. Expedited coupon service.
Sec. 330. Fair hearings.
Sec. 331. Income and eligibility verification system.
Sec. 332. Collection of overissuances.
Sec. 333. Termination of Federal match for optional information 
                            activities.
Sec. 334. Standards for administration.
Sec. 335. Work supplementation or support program.
Sec. 336. Waiver authority.
Sec. 337. Authorization of pilot projects.
Sec. 338. Response to waivers.
Sec. 339. Private sector employment initiatives.
Sec. 340. Reauthorization of appropriations.
Sec. 341. Reauthorization of Puerto Rico nutrition assistance program.
Sec. 342. Simplified food stamp program.
Sec. 343. Optional State food assistance block grant.
Sec. 344. Effective date.
                 Subtitle B--Anti-Fraud and Trafficking

Sec. 351. Expanded definition of coupon.
Sec. 352. Doubled penalties for violating food stamp program 
                            requirements.
Sec. 353. Authority to establish authorization periods.
Sec. 354. Specific period for prohibiting participation of stores based 
                            on lack of business integrity.
Sec. 355. Information for verifying eligibility for authorization.
Sec. 356. Waiting period for stores that initially fail to meet 
                            authorization criteria.
Sec. 357. Bases for suspensions and disqualifications.
Sec. 358. Disqualification of stores pending judicial and 
                            administrative review.
Sec. 359. Disqualification of retailers who are disqualified under the 
                            WIC program.
Sec. 360. Permanent debarment of retailers who intentionally submit 
                            falsified applications.
Sec. 361. Expanded criminal forfeiture for violations.
Sec. 362. Effective date.
                   TITLE IV--CHILD NUTRITION PROGRAMS

                    Subtitle A--Reimbursement Rates

Sec. 401. Termination of additional payment for lunches served in high 
                            free and reduced price participation 
                            schools.
Sec. 402. Value of food assistance.
Sec. 403. Lunches, breakfasts, and supplements.
Sec. 404. Summer food service program for children.
Sec. 405. Special milk program.
Sec. 406. Free and reduced price breakfasts.
Sec. 407. Conforming reimbursement for paid breakfasts and lunches.
                       Subtitle B--Grant Programs

Sec. 411. School breakfast startup grants.
Sec. 412. Nutrition education and training programs.
Sec. 413. Effective date.
                      Subtitle C--Other Amendments

Sec. 421. Free and reduced price policy statement.
Sec. 422. Summer food service program for children.
Sec. 423. Child and adult care food program.
Sec. 424. Reducing required reports to State agencies and schools.
                      Subtitle D--Reauthorization

Sec. 431. Commodity distribution program; commodity supplemental food 
                            program.
Sec. 432. Emergency food assistance program.
Sec. 433. Soup kitchens program.
Sec. 434. National commodity processing.
Sec. 435. Commodity supplemental food program.
                          TITLE V--NONCITIZENS

Sec. 501. State option to prohibit assistance for certain aliens.
Sec. 502. Deemed income requirement for Federal and federally funded 
                            programs.
Sec. 503. Limited eligibility of noncitizens for SSI benefits.
                          TITLE VI--CHILD CARE

Sec. 601. Short title.
Sec. 602. Amendments to the Child Care and Development Block Grant Act 
                            of 1990.
Sec. 603. Repeals and technical and conforming amendments.
 TITLE VII--WORKFORCE DEVELOPMENT AND WORKFORCE PREPARATION ACTIVITIES
                     Subtitle A--General Provisions

Sec. 701. Short title.
Sec. 702. Findings and purposes.
Sec. 703. Definitions.
          Subtitle B--Statewide Workforce Development Systems

          Chapter 1--Provisions For States and Other Entities

Sec. 711. Statewide workforce development systems established.
Sec. 712. State allotments.
Sec. 713. State apportionment by activity.
Sec. 714. State plans.
Sec. 715. State workforce development boards.
Sec. 716. Use of funds.
Sec. 717. Indian workforce development activities.
Sec. 718. Grants to outlying areas.
                      Chapter 2--Local Provisions

Sec. 721. Local apportionment by activity.
Sec. 722. Distribution for secondary school vocational education.
Sec. 723. Distribution for postsecondary and adult vocational 
                            education.
Sec. 724. Distribution for adult education.
Sec. 725. Special rule for minimal allocation.
Sec. 726. Redistribution.
Sec. 727. Local application for workforce education activities.
Sec. 728. Local partnerships, agreements, and workforce development 
                            boards.
                       Chapter 3--Administration

Sec. 731. Accountability.
Sec. 732. Incentives and sanctions.
Sec. 733. Unemployment trust fund.
Sec. 734. Authorization of appropriations.
Sec. 735. Effective date.
 Subtitle C--Job Corps and Other Workforce Preparation Activities for 
                             At-Risk Youth

                Chapter 1--General Job Corps Provisions

Sec. 741. Purposes.
Sec. 742. Definitions.
Sec. 743. General authority.
Sec. 744. Individuals eligible for the Job Corps.
Sec. 745. Screening and selection of applicants.
Sec. 746. Enrollment and assignment.
Sec. 747. Job Corps centers.
Sec. 748. Program activities.
Sec. 749. Support.
Sec. 750. Operating plan.
Sec. 751. Standards of conduct.
Sec. 752. Community participation.
Sec. 753. Counseling and placement.
Sec. 754. Leases and sales of centers.
Sec. 755. Closure of Job Corps centers.
Sec. 756. Interim operating plans for Job Corps centers.
Sec. 757. Effective date.
  Chapter 2--Other Workforce Preparation Activities for At-Risk Youth

Sec. 759. Workforce preparation activities for at-risk youth.
                   Subtitle D--Transition Provisions

Sec. 761. Waivers.
Sec. 762. Interim State plans.
Sec. 763. Applications and plans under covered Acts.
Sec. 764. Interim administration of school-to-work programs.
Sec. 765. Interim authorizations of appropriations.
                    Subtitle E--National Activities

Sec. 771. Federal Partnership.
Sec. 772. National assessment of vocational education programs.
Sec. 773. Labor market information.
Sec. 774. National Center for Research in Education and Workforce 
                            Development.
Sec. 775. Transfers to Federal Partnership.
Sec. 776. Transfers to other Federal agencies and offices.
Sec. 777. Elimination of certain offices.
Subtitle F--Repeals of Employment and Training and Vocational and Adult 
                           Education Programs

Sec. 781. Repeals.
Sec. 782. Conforming amendments.
          TITLE VIII--WORKFORCE DEVELOPMENT-RELATED ACTIVITIES

        Subtitle A--Amendments to the Rehabilitation Act of 1973

Sec. 801. References.
Sec. 802. Findings and purposes.
Sec. 803. Consolidated rehabilitation plan.
Sec. 804. Definitions.
Sec. 805. Administration.
Sec. 806. Reports.
Sec. 807. Evaluation.
Sec. 808. Declaration of policy.
Sec. 809. State plans.
Sec. 810. Individualized employment plans.
Sec. 811. Scope of vocational rehabilitation services.
Sec. 812. State Rehabilitation Advisory Council.
Sec. 813. Evaluation standards and performance indicators.
Sec. 814. Repeals.
Sec. 815. Effective date.
       Subtitle B--Amendments to Immigration and Nationality Act

Sec. 821. Prohibition on use of funds for certain employment 
                            activities.
                        TITLE IX--CHILD SUPPORT

Sec. 900. Reference to Social Security Act.
     Subtitle A--Eligibility for Services; Distribution of Payments

Sec. 901. State obligation to provide child support enforcement 
                            services.
Sec. 902. Distribution of child support collections.
Sec. 903. Rights to notification and hearings.
Sec. 904. Privacy safeguards.
                  Subtitle B--Locate and Case Tracking

Sec. 911. State Case Registry.
Sec. 912. Collection and disbursement of support payments.
Sec. 913. State Directory of New Hires.
Sec. 914. Amendments concerning income withholding.
Sec. 915. Locator information from interstate networks.
Sec. 916. Expansion of the Federal parent locator service.
Sec. 917. Collection and use of social security numbers for use in 
                            child support enforcement.
         Subtitle C--Streamlining and Uniformity of Procedures

Sec. 921. Adoption of uniform State laws.
Sec. 922. Improvements to full faith and credit for child support 
                            orders.
Sec. 923. Administrative enforcement in interstate cases.
Sec. 924. Use of forms in interstate enforcement.
Sec. 925. State laws providing expedited procedures.
                  Subtitle D--Paternity Establishment

Sec. 931. State laws concerning paternity establishment.
Sec. 932. Outreach for voluntary paternity establishment.
Sec. 933. Cooperation by applicants for and recipients of temporary 
                            family assistance.
             Subtitle E--Program Administration and Funding

Sec. 941. Performance-based incentives and penalties.
Sec. 942. Federal and State reviews and audits.
Sec. 943. Required reporting procedures.
Sec. 944. Automated data processing requirements.
Sec. 945. Technical assistance.
Sec. 946. Reports and data collection by the Secretary.
      Subtitle F--Establishment and Modification of Support Orders

Sec. 951. National Child Support Guidelines Commission.
Sec. 952. Simplified process for review and adjustment of child support 
                            orders.
Sec. 953. Furnishing consumer reports for certain purposes relating to 
                            child support.
Sec. 954. Nonliability for depository institutions providing financial 
                            records to State child support enforcement 
                            agencies in child support cases.
               Subtitle G--Enforcement of Support Orders

Sec. 961. Internal Revenue Service collection of arrearages.
Sec. 962. Authority to collect support from Federal employees.
Sec. 963. Enforcement of child support obligations of members of the 
                            Armed Forces.
Sec. 964. Voiding of fraudulent transfers.
Sec. 965. Work requirement for persons owing child support.
Sec. 966. Definition of support order.
Sec. 967. Reporting arrearages to credit bureaus.
Sec. 968. Liens.
Sec. 969. State law authorizing suspension of licenses.
Sec. 970. Denial of passports for nonpayment of child support.
Sec. 971. International child support enforcement.
                      Subtitle H--Medical Support

Sec. 975. Technical correction to ERISA definition of medical child 
                            support order.
Sec. 976. Enforcement of orders for health care coverage.
Subtitle I--Enhancing Responsibility and Opportunity for Nonresidential 
                                Parents

Sec. 981. Grants to States for access and visitation programs.
                    Subtitle J--Effect of Enactment

Sec. 991. Effective dates.
                   TITLE X--REFORM OF PUBLIC HOUSING

Sec. 1001. Ceiling rents.
Sec. 1002. Definition of adjusted income for public housing.
Sec. 1003. Exemption of tenants from labor standards.
Sec. 1004. Failure to comply with other welfare and public assistance 
                            programs.
Sec. 1005. Applicability to Indian housing.
Sec. 1006. Implementation.
Sec. 1007. Effective date.
   TITLE I--BLOCK GRANTS FOR TEMPORARY ASSISTANCE FOR NEEDY FAMILIES

SEC. 100. REFERENCES TO SOCIAL SECURITY ACT.

    Except as otherwise specifically provided, wherever in this title 
an amendment is expressed in terms of an amendment to or repeal of a 
section or other provision, the reference shall be considered to be 
made to that section or other provision of the Social Security Act.

SEC. 101. BLOCK GRANTS TO STATES.

    (a) Repeals.--
            (1) In general.--Parts A and F of title IV (42 U.S.C. 601 
        et seq. and 682 et seq.) are hereby repealed.
            (2) Rules and regulations.--The Secretary of Health and 
        Human Services shall ensure that any rules and regulations 
        relating to the provisions of law repealed in paragraph (1) 
        shall cease to have effect on and after the date of the repeal 
        of such provisions.
    (b) Block Grants to States for Temporary Assistance for Needy 
Families With Minor Children.--Title IV (42 U.S.C. 601 et seq.) is 
amended by inserting before part B the following:

  ``PART A--BLOCK GRANTS TO STATES FOR TEMPORARY ASSISTANCE FOR NEEDY 
                      FAMILIES WITH MINOR CHILDREN

``SEC. 400. NO INDIVIDUAL ENTITLEMENT.

    ``Notwithstanding any other provision of law, no individual is 
entitled to any assistance under this part.

``SEC. 401. PURPOSE.

    ``The purpose of this part is to increase the flexibility of States 
in operating a program designed to--
            ``(1) provide assistance to needy families with minor 
        children;
            ``(2) provide job preparation and opportunities for such 
        families; and
            ``(3) prevent and reduce the incidence of out-of-wedlock 
        pregnancies.

``SEC. 402. ELIGIBLE STATES; STATE PLAN.

    ``(a) In General.--As used in this part, the term `eligible State' 
means, with respect to a fiscal year, a State that has submitted to the 
Secretary a plan that includes the following:
            ``(1) Outline of family assistance program.--A written 
        document that outlines how the State intends to do the 
        following:
                    ``(A) Conduct a program designed to serve all 
                political subdivisions in the State to--
                            ``(i) provide assistance to needy families 
                        with not less than 1 minor child; and
                            ``(ii) provide a parent or caretaker in 
                        such families with work experience, assistance 
                        in finding employment, and other work 
                        preparation activities and support services 
                        that the State considers appropriate to enable 
                        such families to leave the program and become 
                        self-sufficient.
                    ``(B) Require a parent or caretaker receiving 
                assistance under the program to engage in work (as 
                defined by the State) when the State determines the 
                parent or caretaker is ready to engage in work, or 
                after 24 months (whether or not consecutive) of 
                receiving assistance under the program, whichever is 
                earlier.
                    ``(C) Satisfy the minimum participation rates 
                specified in section 404.
                    ``(D) Treat--
                            ``(i) families with minor children moving 
                        into the State from another State; and
                            ``(ii) noncitizens of the United States.
                    ``(E) Safeguard and restrict the use and disclosure 
                of information about individuals and families receiving 
                assistance under the program.
                    ``(F) Establish goals and take action to prevent 
                and reduce the incidence of out-of-wedlock pregnancies, 
                with special emphasis on teenage pregnancies.
            ``(2) Certification that the state will operate a child 
        support enforcement program.--A certification by the chief 
        executive officer of the State that, during the fiscal year, 
        the State will operate a child support enforcement program 
        under the State plan approved under part D.
            ``(3) Certification that the state will operate a child 
        protection program.--A certification by the chief executive 
        officer of the State that, during the fiscal year, the State 
        will operate a child protection program under the State plan 
        approved under part B.
            ``(4) Certification that the state will operate a foster 
        care and adoption assistance program.--A certification by the 
        chief executive officer of the State that, during the fiscal 
        year, the State will operate a foster care and adoption 
        assistance program under the State plan approved under part E.
            ``(5) Certification that the state will participate in the 
        income and eligibility verification system.--A certification by 
        the chief executive officer of the State that, during the 
        fiscal year, the State will participate in the income and 
        eligibility verification system required by section 1137.
            ``(6) Certification of the administration of the program.--
        A certification by the chief executive officer of the State 
        specifying which State agency or agencies are responsible for 
        the administration and supervision of the State program for the 
        fiscal year.
            ``(7) Certification that required reports will be 
        submitted.--A certification by the chief executive officer of 
        the State that the State shall provide the Secretary with any 
        reports required under this part.
            ``(8) Estimate of fiscal year state and local 
        expenditures.--An estimate of the total amount of State and 
        local expenditures under the State program for the fiscal year.
    ``(b) Certification That the State Will Provide Access to 
Indians.--
            ``(1) In general.--In recognition of the Federal 
        Government's trust responsibility to, and government-to-
        government relationship with, Indian tribes, the Secretary 
        shall ensure that Indians receive at least their equitable 
        share of services under the State program, by requiring a 
        certification by the chief executive officer of each State 
        described in paragraph (2) that, during the fiscal year, the 
        State shall provide Indians in each Indian tribe that does not 
        have a tribal family assistance plan approved under section 414 
        for a fiscal year with equitable access to assistance under the 
        State program funded under this part.
            ``(2) State described.--For purposes of paragraph (1), a 
        State described in this paragraph is a State in which there is 
        an Indian tribe that does not have a tribal family assistance 
        plan approved under section 414 for a fiscal year.
    ``(c) Definitions.--For purposes of this part, the following 
definitions shall apply:
            ``(1) Adult.--The term `adult' means an individual who is 
        not a minor child.
            ``(2) Minor child.--The term `minor child' means an 
        individual--
                    ``(A) who--
                            ``(i) has not attained 18 years of age; or
                            ``(ii) has not attained 19 years of age and 
                        is a full-time student in a secondary school 
                        (or in the equivalent level of vocational or 
                        technical training); and
                    ``(B) who resides with such individual's custodial 
                parent or other caretaker.
            ``(3) Fiscal year.--The term `fiscal year' means any 12-
        month period ending on September 30 of a calendar year.
            ``(4) Indian, indian tribe, and tribal organization.--The 
        terms `Indian', `Indian tribe', and `tribal organization' have 
        the meaning given such terms by section 4 of the Indian Self-
        Determination and Education Assistance Act (25 U.S.C. 450b).
            ``(5) State.--Except as otherwise specifically provided, 
        the term `State' includes the several States, the District of 
        Columbia, the Commonwealth of Puerto Rico, the United States 
        Virgin Islands, Guam, and American Samoa.

``SEC. 403. PAYMENTS TO STATES AND INDIAN TRIBES.

    ``(a) Grant Amount.--
            ``(1) In general.--Subject to the provisions of paragraph 
        (3), section 407 (relating to penalties), and section 414(g), 
        for each of fiscal years 1996, 1997, 1998, 1999, and 2000, the 
        Secretary shall pay--
                    ``(A) each eligible State a grant in an amount 
                equal to the State family assistance grant for the 
                fiscal year; and
                    ``(B) each Indian tribe with an approved tribal 
                family assistance plan a tribal family assistance grant 
                in accordance with section 414.
            ``(2) State family assistance grant.--
                    ``(A) In general.--For purposes of paragraph 
                (1)(A), a State family assistance grant for any State 
                for a fiscal year is an amount equal to the total 
                amount of the Federal payments to the State under 
                section 403 for fiscal year 1994 (as such section was 
                in effect during such fiscal year and as such payments 
                were reported by the State on February 14, 1995), 
                reduced by the amount (if any) determined under 
                subparagraph (B).
                    ``(B) Amount attributable to certain indian 
                families served by indian tribes.--
                            ``(i) In general.--For purposes of 
                        subparagraph (A), the amount determined under 
                        this subparagraph is an amount equal to the 
                        Federal payments to the State under section 403 
                        for fiscal year 1994 (as in effect during such 
                        fiscal year) attributable to expenditures by 
                        the State under parts A and F of this title (as 
                        so in effect) for Indian families described in 
                        clause (ii).
                            ``(ii) Indian families described.--For 
                        purposes of clause (i), Indian families 
                        described in this clause are Indian families 
                        who reside in a service area or areas of an 
                        Indian tribe receiving a tribal family 
                        assistance grant under section 414.
                    ``(C) Notification.--Not later than 3 months prior 
                to the payment of each quarterly installment of a State 
                grant under subsection (a)(1), the Secretary shall 
                notify the State of the amount of the reduction 
                determined under subparagraph (B) with respect to the 
                State.
            ``(3) Supplemental grant amount for population increases in 
        certain states.--
                    ``(A) In general.--The amount of the grant payable 
                under paragraph (1) to a qualifying State for each of 
                fiscal years 1997, 1998, 1999, and 2000 shall be 
                increased by an amount equal to 2.5 percent of the 
                amount that the State received under this section in 
                the preceding fiscal year.
                    ``(B) Increase to remain in effect even if state 
                fails to qualify in later years.--Subject to section 
                407, in no event shall the amount of a grant payable 
                under paragraph (1) to a State for any fiscal year be 
                less than the amount the State received under this 
                section for the preceding fiscal year.
                    ``(C) Qualifying state.--
                            ``(i) In general.--For purposes of this 
                        paragraph, the term `qualifying State', with 
                        respect to any fiscal year, means a State 
                        that--
                                    ``(I) had an average level of State 
                                welfare spending per poor person in the 
                                preceding fiscal year that was less 
                                than the national average level of 
                                State welfare spending per poor person 
                                in the preceding fiscal year; and
                                    ``(II) had an estimated rate of 
                                State population growth as determined 
                                by the Bureau of the Census for the 
                                most recent fiscal year for which 
                                information is available that
                                 was greater than the average rate of 
population growth for all States as determined by the Bureau of the 
Census for such fiscal year.
                            ``(ii) Certain states deemed qualifying 
                        states.--For purposes of this paragraph, a 
                        State shall be deemed to be a qualifying State 
                        for fiscal years 1997, 1998, 1999, and 2000 if 
                        the level of State welfare spending per poor 
                        person in fiscal year 1996 was less than 35 
                        percent of the national average level of State 
                        welfare spending per poor person in fiscal year 
                        1996.
                            ``(iii) State must qualify in fiscal year 
                        1997.--A State shall not be eligible to be a 
                        qualifying State under clause (i) for fiscal 
                        years after 1997 if the State was not a 
                        qualifying State under clause (i) in fiscal 
                        year 1997.
                    ``(D) Definitions.--For purposes of this paragraph:
                            ``(i) Level of state welfare spending per 
                        poor person.--The term `level of State welfare 
                        spending per poor person' means, with respect 
                        to a State for any fiscal year--
                                    ``(I) the amount of the grant 
                                received by the State under this 
                                section (prior to the application of 
                                section 407); divided by
                                    ``(II) the number of the 
                                individuals in the State who had an 
                                income below the poverty line according 
                                to the 1990 decennial census.
                            ``(ii) National average level of state 
                        welfare spending per poor person.--The term 
                        `national average level of State welfare 
                        spending per poor person' means an amount equal 
                        to--
                                    ``(I) the amount paid in grants 
                                under this section (prior to the 
                                application of section 407); divided by
                                    ``(II) the number of individuals in 
                                all States with an income below the 
                                poverty line according to the 1990 
                                decennial census.
                            ``(iii) Poverty line.--The term `poverty 
                        line' has the same meaning given such term in 
                        section 673(2) of the Community Services Block 
                        Grant Act (42 U.S.C. 9902(2)).
                            ``(iv) State.--The term `State' means each 
                        of the 50 States of the United States.
            ``(4) Appropriation.--
                    ``(A) States.--There are authorized to be 
                appropriated and there are appropriated $16,795,323,000 
                for each fiscal year described in paragraph (1) for the 
                purpose of paying--
                            ``(i) grants to States under paragraph 
                        (1)(A); and
                            ``(ii) tribal family assistance grants 
                        under paragraph (1)(B).
                    ``(B) Adjustment for qualifying states.--For the 
                purpose of increasing the amount of the grant payable 
                to a State under paragraph (1) in accordance with 
                paragraph (3), there are authorized to be appropriated 
                and there are appropriated--
                            ``(i) for fiscal year 1997, $85,860,000;
                            ``(ii) for fiscal year 1998, $173,276,000;
                            ``(iii) for fiscal year 1999, $263,468,000; 
                        and
                            ``(iv) for fiscal year 2000, $355,310,000.
    ``(b) Use of Grant.--
            ``(1) In general.--Subject to this part, a State to which a 
        grant is made under this section may use the grant--
                    ``(A) in any manner that is reasonably calculated 
                to accomplish the purpose of this part; or
                    ``(B) in any manner that such State used amounts 
                received under part A or F of this title, as such parts 
                were in effect before October 1, 1995.
            ``(2) Authority to treat interstate immigrants under rules 
        of former state.--A State to which a grant is made under this 
        section may apply to a family the rules of the program operated 
        under this part of another State if the family has moved to the 
        State from the other State and has resided in the State for 
        less than 12 months.
            ``(3) Authority to reserve certain amounts for 
        assistance.--A State may reserve amounts paid to the State 
        under this part for any fiscal year for the purpose of 
        providing, without fiscal year limitation, assistance under the 
        State program operated under this part.
            ``(4) Authority to operate employment placement program.--A 
        State to which a grant is made under this section may use a 
        portion of the grant to make payments (or provide job placement 
        vouchers) to State-approved public and private job placement 
        agencies that provide employment placement services to 
        individuals who receive assistance under the State program 
        funded under this part.
            ``(5) Transferability of grant amounts.--A State may use up 
        to 30 percent of amounts received from a grant under this part 
        for a fiscal year to carry out State activities under the Child 
        Care and Development Block Grant Act of 1990 (42 U.S.C. 9858 et 
        seq.) (relating to child care block grants).
    ``(c) Timing of Payments.--The Secretary shall pay each grant 
payable to a State under this section in quarterly installments.
    ``(d) Federal Loan Fund for State Welfare Programs.--
            ``(1) Establishment.--There is hereby established in the 
        Treasury of the United States a revolving loan fund which shall 
        be known as the `Federal
         Loan Fund for State Welfare Programs' (hereafter for purposes 
of this section referred to as the `fund').
            ``(2) Deposits into fund.--
                    ``(A) Appropriation.--Out of any money in the 
                Treasury of the United States not otherwise 
                appropriated, $1,700,000,000 are hereby appropriated 
                for fiscal year 1996 for payment to the fund.
                    ``(B) Loan repayments.--The Secretary shall deposit 
                into the fund any principal or interest payment 
                received with respect to a loan made under this 
                subsection.
            ``(3) Availability.--Amounts in the fund are authorized to 
        remain available without fiscal year limitation for the purpose 
        of making loans and receiving payments of principal and 
        interest on such loans, in accordance with this subsection.
            ``(4) Use of fund.--
                    ``(A) Loans to states.--The Secretary shall make 
                loans from the fund to any loan-eligible State, as 
                defined in subparagraph (D), for a period to maturity 
                of not more than 3 years.
                    ``(B) Rate of interest.--The Secretary shall charge 
                and collect interest on any loan made under 
                subparagraph (A) at a rate equal to the Federal short-
                term rate, as defined in section 1274(d) of the 
                Internal Revenue Code of 1986.
                    ``(C) Maximum loan.--The cumulative amount of any 
                loans made to a State under subparagraph (A) during 
                fiscal years 1996 through 2000 shall not exceed 10 
                percent of the State family assistance grant under 
                subsection (a)(2) for a fiscal year.
                    ``(D) Loan-eligible state.--For purposes of 
                subparagraph (A), a loan-eligible State is a State 
                which has not had a penalty described in section 
                407(a)(1) imposed against it at any time prior to the 
                loan being made.
            ``(5) Limitation on use of loan.--A State shall use a loan 
        received under this subsection only for any purpose for which 
        grant amounts received by the State under subsection (a) may be 
        used including--
                    ``(A) welfare anti-fraud activities; and
                    ``(B) the provision of assistance under the State 
                program to Indian families that have moved from the 
                service area of an Indian tribe with a tribal family 
                assistance plan approved under section 414.
    ``(e) Special Rule for Indian Tribes That Received JOBS Funds.--
            ``(1) In general.--The Secretary shall pay to each eligible 
        Indian tribe for each of fiscal years 1996, 1997, 1998, 1999, 
        and 2000 a grant in an amount equal to the amount received by 
        such Indian tribe in fiscal year 1995 under section 482(i) (as 
        in effect during such fiscal year) for the purpose of operating 
        a program to make work activities available to members of the 
        Indian tribe.
            ``(2) Eligible indian tribe.--For purposes of paragraph 
        (1), the term `eligible Indian tribe' means an Indian tribe or 
        Alaska Native organization that conducted a job opportunities 
        and basic skills training program in fiscal year 1995 under 
        section 482(i) (as in effect during such fiscal year).
            ``(3) Appropriation.--There are authorized to be 
        appropriated and there are hereby appropriated $7,638,474 for 
        each fiscal year described in paragraph (1) for the purpose of 
        paying grants in accordance with such paragraph.
    ``(f) Secretary.--For purposes of this section, the term 
`Secretary' means the Secretary of the Treasury.

``SEC. 404. MANDATORY WORK REQUIREMENTS.

    ``(a) Participation Rate Requirements.--A State to which a grant is 
made under section 403 for a fiscal year shall achieve the minimum 
participation rate specified in the following tables for the fiscal 
year with respect to--
            ``(1) all families receiving assistance under the State 
        program funded under this part:

                    
                                                            The minimum
                    
                                                          participation
                    ``If the fiscal year is:
                                              rate for all families is:
                          1996.......................              25  
                          1997.......................              30  
                          1998.......................              35  
                          1999.......................              40  
                          2000 or thereafter.........           50; and
            ``(2) with respect to 2-parent families receiving such 
        assistance:

                    
                                                            The minimum
                    
                                                          participation
                    ``If the fiscal year is:
                                                               rate is:
                          1996.......................              60  
                          1997 or 1998...............              75  
                          1999 or thereafter.........             90.  
    ``(b) Calculation of Participation Rates.--
            ``(1) For all families.--
                    ``(A) Average monthly rate.--For purposes of 
                subsection (a)(1), the participation rate for all 
                families of a State for a fiscal year is the average of 
                the participation rates for all
                 families of the State for each month in the fiscal 
year.
                    ``(B) Monthly participation rates.--The 
                participation rate of a State for all families of the 
                State for a month, expressed as a percentage, is--
                            ``(i) the sum of--
                                    ``(I) the number of all families 
                                receiving assistance under the State 
                                program funded under this part that 
                                include an adult who is engaged in work 
                                for the month;
                                    ``(II) the number of all families 
                                receiving assistance under the State 
                                program funded under this part that are 
                                subject in such month to a penalty 
                                described in paragraph (1)(A) or (2)(A) 
                                of subsection (d) but have not been 
                                subject to such penalty for more than 3 
                                months within the preceding 12-month 
                                period (whether or not consecutive);
                                    ``(III) the number of all families 
                                receiving assistance under the State 
                                program funded under this part that 
                                have become ineligible for assistance 
                                under the State program within the 
                                previous 6-month period because of 
                                employment and that include an adult 
                                who is employed for the month; and
                                    ``(IV) beginning in the first month 
                                beginning after the promulgation of the 
                                regulations described in paragraph (3) 
                                and in accordance with such 
                                regulations, the average monthly number 
                                of all families that are not receiving 
                                assistance under the State program 
                                funded under this part as a result of 
                                the State's diversion of such families 
                                from the State program prior to such 
                                families receipt of assistance under 
                                the program; divided by
                            ``(ii) the total number of all families 
                        receiving assistance under the State program 
                        funded under this part during the month that 
                        include an adult.
            ``(2) 2-parent families.--
                    ``(A) Average monthly rate.--For purposes of 
                subsection (a)(2), the participation rate for 2-parent 
                families of a State for a fiscal year is the average of 
                the participation rates for 2-parent families of the 
                State for each month in the fiscal year.
                    ``(B) Monthly participation rates.--The 
                participation rate of a State for 2-parent families of 
                the State for a month, expressed as a percentage, is--
                            ``(i) the total number of 2-parent families 
                        described in paragraph (1)(B)(i); divided by
                            ``(ii) the total number of 2-parent 
                        families receiving assistance under the State 
                        program funded under this part during the month 
                        that include an adult.
            ``(3) Regulations relating to calculation of families 
        diverted from assistance.--
                    ``(A) In general.--Not later than 1 year after the 
                date of the enactment of the Work Opportunity Act of 
                1995, the Secretary shall consult with the States and 
                establish, by regulation, a method to measure the 
                number of families diverted by a State from the State 
                program funded under this part prior to such families 
                receipt of assistance under the program.
                    ``(B) Eligibility changes not counted.--The 
                regulations described in subparagraph (A) shall not 
                take into account families that are diverted from a 
                State program funded under this part as a result of 
                differences in eligibility criteria under a State 
                program funded under this part and eligibility criteria 
                under such State's plan under the aid to families with 
                dependent children program, as such plan was in effect 
                on the day before the date of the enactment of the Work 
                Opportunity Act of 1995.
            ``(4) State option to include individuals receiving 
        assistance under a tribal family assistance plan.--For purposes 
        of paragraphs (1)(B) and (2)(B), a State may, at its option, 
        include families receiving assistance under a tribal family 
        assistance plan approved under section 414. For purposes of the 
        previous sentence, an individual who receives assistance under 
        a tribal family assistance plan approved under section 414 
        shall be treated as being engaged in work if the individual is 
        participating in work under standards that are comparable to 
        State standards for being engaged in work.
    ``(c) Engaged in Work.--
            ``(1) All families.--For purposes of subsection 
        (b)(1)(B)(i)(I), an adult is engaged in work for a month in a 
        fiscal year if the adult is participating in work for at least 
        the minimum average number of hours per week specified in the 
        following table during the month, not fewer than 20 hours per 
        week of which are attributable to a work activity:

                         
                                                            The minimum
                         ``If the month is
                                                      average number of
                           in fiscal year:
                                                     hours per week is:
                               1996..................              20  
                               1997..................              20  
                               1998..................              20  
                               1999..................              25  
                               2000..................              30  
                               2001..................              30  
                               2002..................              35  
                               2003 or thereafter....             35.  
            ``(2) 2-parent families.--For purposes of subsection 
        (b)(2)(A), an adult is engaged in work for a month in a fiscal 
        year if the adult is participating in work for at least 35 
        hours per week during the month, not fewer than 30 hours per 
        week of which are attributable to work activities described in 
        paragraph (3).
            ``(3) Definition of work activities.--For purposes of this 
        subsection, the term `work activities' means--
                    ``(A) unsubsidized employment;
                    ``(B) subsidized employment;
                    ``(C) on-the-job training;
                    ``(D) community service programs; and
                    ``(E) job search (only for the first 4 weeks in 
                which an individual is required to participate in work 
                activities under this section).
    ``(d) Penalties Against Individuals.--If an adult in a family 
receiving assistance under the State program funded under this part 
refuses to engage in work required under subsection (c)(1) or (c)(2), a 
State to which a grant is made under section 403 shall--
            ``(1) reduce the amount of assistance that would otherwise 
        be payable to the family; or
            ``(2) terminate such assistance,
        subject to such good cause and other exceptions as the State 
        may establish.
    ``(e) Nondisplacement in Work Activities.--
            ``(1) In general.--Subject to paragraph (2), an adult in a 
        family receiving assistance under this part may fill a vacant 
        employment position in order to engage in a work activity 
        described in subsection (c)(3).
            ``(2) No filling of certain vacancies.--No adult described 
        in paragraph (1) shall be employed, or job opening filled, by 
        such an adult--
                    ``(A) when any other individual is on layoff from 
                the same or any substantially equivalent job; or
                    ``(B) when the employer has terminated the 
                employment of any regular employee or otherwise reduced 
                its workforce with the intention of filling the vacancy 
                so created by hiring an adult described in paragraph 
                (1).
    ``(f) Sense of the Congress.--It is the sense of the Congress that 
in complying with this section, each State that operates a program 
funded under this part is encouraged to assign the highest priority to 
requiring adults in 2-parent families and adults in single-parent 
families that include older preschool or school-age children to be 
engaged in work activities.
    ``(g) Delivery Through Statewide System.--
            ``(1) In general.--Each work program carried out by the 
        State to provide work activities in order to comply with this 
        section shall be delivered through the statewide workforce 
        development system established in section 711 of the Work 
        Opportunity Act of 1995 unless a required work activity is not 
        available locally through the statewide workforce development 
        system.
            ``(2) Effective date.--The provisions of paragraph (1) 
        shall take effect--
                    ``(A) in a State described in section 815(b)(1) of 
                the Work Opportunity Act of 1995; and
                    ``(B) in any other State, on July 1, 1998.

``SEC. 405. REQUIREMENTS AND LIMITATIONS.

    ``(a) State Required to Enter Into a Personal Responsibility 
Contract With Each Family Receiving Assistance.--Each State to which a 
grant is made under section 403 shall require each family receiving 
assistance under the State program funded under this part to have 
entered into a personal responsibility contract (as developed by the 
State) with the State.
    ``(b) No Assistance for More Than 5 Years.--
            ``(1) In general.--Except as provided under paragraphs (2) 
        and (3), a State to which a grant is made under section 403 may 
        not use any part of the grant to provide assistance to a family 
        that includes an adult who has received assistance under the 
        program operated under this part for the lesser of--
                    ``(A) the period of time established at the option 
                of the State; or
                    ``(B) 60 months (whether or not consecutive) after 
                September 30, 1995.
            ``(2) Minor child exception.--If an individual received 
        assistance under the State program operated under this part as 
        a minor child in a needy family, any period during which such 
        individual's family received assistance shall not be counted 
        for purposes of applying the limitation described in paragraph 
        (1) to an application for assistance under such program by such 
        individual as the head of a household of a needy family with 
        minor children.
            ``(3) Hardship exception.--
                    ``(A) In general.--The State may exempt a family 
                from the application of paragraph (1) by reason of 
                hardship.
                    ``(B) Limitation.--The number of families with 
                respect to which an exemption made by a State under 
                subparagraph (A) is in effect for a fiscal year shall 
                not exceed 15 percent of the average monthly number of 
                families to which the State is providing assistance 
                under the program operated under this part.
    ``(c) Denial of Assistance for 10 Years to a Person Found To Have 
Fraudulently Misrepresented Residence in Order To Obtain Assistance in 
2 or More States.--An individual shall not be considered an eligible 
individual for the purposes of this part during the 10-year period that 
begins on the date the individual is convicted in Federal or State 
court of having made a fraudulent statement or representation with 
respect to the place of residence of the individual in order to receive 
assistance simultaneously from 2 or more States under programs that are 
funded under this title, title XIX, or the Food Stamp Act of 1977, or 
benefits in 2 or more States under the supplemental security income 
program under title XVI.
    ``(d) Denial of Assistance for Fugitive Felons and Probation and 
Parole Violators.--
            ``(1) In general.--An individual shall not be considered an 
        eligible individual for the purposes of this part if such 
        individual is--
                    ``(A) fleeing to avoid prosecution, or custody or 
                confinement after conviction, under the laws of the 
                place from which the individual flees, for a crime, or 
                an attempt to commit a crime, which is a felony under 
                the laws
                 of the place from which the individual flees, or 
which, in the case of the State of New Jersey, is a high misdemeanor 
under the laws of such State; or
                    ``(B) violating a condition of probation or parole 
                imposed under Federal or State law.
            ``(2) Exchange of information with law enforcement 
        agencies.--Notwithstanding any other provision of law, a State 
        shall furnish any Federal, State, or local law enforcement 
        officer, upon the request of the officer, with the current 
        address of any recipient of assistance under this part, if the 
        officer furnishes the agency with the name of the recipient and 
        notifies the agency that--
                    ``(A) such recipient--
                            ``(i) is described in subparagraph (A) or 
                        (B) of paragraph (1); or
                            ``(ii) has information that is necessary 
                        for the officer to conduct the officer's 
                        official duties; and
                    ``(B) the location or apprehension of the recipient 
                is within such officer's official duties.

``SEC. 406. PROMOTING RESPONSIBLE PARENTING.

    ``(a) Findings.--The Congress makes the following findings:
            ``(1) Marriage is the foundation of a successful society.
            ``(2) Marriage is an essential institution of a successful 
        society which promotes the interests of children.
            ``(3) Promotion of responsible fatherhood and motherhood is 
        integral to successful child rearing and the wellbeing of 
        children.
            ``(4) In 1992, only 54 percent of single-parent families 
        with children had a child support order established and, of 
        that 54 percent, only about one half received the full amount 
        due. Of the cases enforced through the public child support 
        enforcement system, only 18 percent of the caseload has a 
        collection.
            ``(5) The number of individuals receiving aid to families 
        with dependent children (hereafter in this subsection referred 
        to as `AFDC') has more than tripled since 1965. More than two-
        thirds of these recipients are children. Eighty-nine percent of 
        children receiving AFDC benefits now live in homes in which no 
        father is present.
                    ``(A)(i) The average monthly number of children 
                receiving AFDC benefits--
                            ``(I) was 3,300,000 in 1965;
                            ``(II) was 6,200,000 in 1970;
                            ``(III) was 7,400,000 in 1980; and
                            ``(IV) was 9,300,000 in 1992.
                    ``(ii) While the number of children receiving AFDC 
                benefits increased nearly threefold between 1965 and 
                1992, the total number of children in the United States 
                aged 0 to 18 has declined by 5.5 percent.
                    ``(B) The Department of Health and Human Services 
                has estimated that 12,000,000 children will receive 
                AFDC benefits within 10 years.
                    ``(C) The increase in the number of children 
                receiving public assistance is closely related to the 
                increase in births to unmarried women. Between 1970 and 
                1991, the percentage of live births to unmarried women 
                increased nearly threefold, from 10.7 percent to 29.5 
                percent.
            ``(6) The increase of out-of-wedlock pregnancies and births 
        is well documented as follows:
                    ``(A) It is estimated that the rate of nonmarital 
                teen pregnancy rose 23 percent from 54 pregnancies per 
                1,000 unmarried teenagers in 1976 to 66.7 pregnancies 
                in 1991. The overall rate of nonmarital pregnancy rose 
                14 percent from 90.8 pregnancies per 1,000 unmarried 
                women in 1980 to 103 in both 1991 and 1992. In 
                contrast, the overall pregnancy rate for married 
                couples decreased 7.3 percent between 1980 and 1991, 
                from 126.9 pregnancies per 1,000 married women in 1980 
                to 117.6 pregnancies in 1991.
                    ``(B) The total of all out-of-wedlock births 
                between 1970 and 1991 has risen from 10.7 percent to 
                29.5 percent and if the current trend continues, 50 
                percent of all births by the year 2015 will be out-of-
                wedlock.
            ``(7) The negative consequences of an out-of-wedlock birth 
        on the mother, the child, the family, and society are well 
        documented as follows:
                    ``(A) Young women 17 and under who give birth 
                outside of marriage are more likely to go on public 
                assistance and to spend more years on welfare once 
                enrolled. These combined effects of `younger and 
                longer' increase total AFDC costs per household by 25 
                percent to 30 percent for 17-year olds.
                    ``(B) Children born out-of-wedlock have a 
                substantially higher risk of being born at a very low 
                or moderately low birth weight.
                    ``(C) Children born out-of-wedlock are more likely 
                to experience low verbal cognitive attainment, as well 
                as more child abuse, and neglect.
                    ``(D) Children born out-of-wedlock were more likely 
                to have lower cognitive scores, lower educational 
                aspirations, and a greater likelihood of becoming 
                teenage parents themselves.
                    ``(E) Being born out-of-wedlock significantly 
                reduces the chances of the child growing up to have an 
                intact marriage.
                    ``(F) Children born out-of-wedlock are 3 more times 
                likely to be on welfare when they grow up.
            ``(8) Currently 35 percent of children in single-parent 
        homes were born out-of-wedlock, nearly the same percentage as 
        that of children in single-parent homes whose parents are 
        divorced (37 percent). While many parents find themselves, 
        through divorce or tragic circumstances beyond their control, 
        facing the difficult task of raising children alone, 
        nevertheless, the negative consequences of raising children in 
        single-parent homes are well documented as follows:
                    ``(A) Only 9 percent of married-couple families 
                with children under 18 years of age have income below 
                the national poverty level. In contrast, 46 percent of 
                female-headed households with children under 18 years 
                of age are below the national poverty level.
                    ``(B) Among single-parent families, nearly \1/2\ of 
                the mothers who never married received AFDC while only 
                \1/5\ of divorced mothers received AFDC.
                    ``(C) Children born into families receiving welfare 
                assistance are 3 times more likely to be on welfare 
                when they reach adulthood than children not born into 
                families receiving welfare.
                    ``(D) Mothers under 20 years of age are at the 
                greatest risk of bearing low birth-weight babies.
                    ``(E) The younger the single parent mother, the 
                less likely she is to finish high school.
                    ``(F) Young women who have children before 
                finishing high school are more likely to receive 
                welfare assistance for a longer period of time.
                    ``(G) 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.
                    ``(H) The absence of a father in the life of a 
                child has a negative effect on school performance and 
                peer adjustment.
                    ``(I) Children of teenage single parents have lower 
                cognitive scores, lower educational aspirations, and a 
                greater likelihood of becoming teenage parents 
                themselves.
                    ``(J) Children of single-parent homes are 3 times 
                more likely to fail and repeat a year in grade school 
                than are children from intact two-parent families.
                    ``(K) Children from single-parent homes are almost 
                4 times more likely to be expelled or suspended from 
                school.
                    ``(L) Neighborhoods with larger percentages of 
                youth aged 12 through 20 and areas with higher 
                percentages of single-parent households have higher 
                rates of violent crime.
                    ``(M) Of those youth held for criminal offenses 
                within the State juvenile justice system, only 29.8 
                percent lived primarily in a home with both parents. In 
                contrast to these incarcerated youth, 73.9 percent of 
                the 62,800,000 children in the Nation's resident 
                population were living with both parents.
            ``(9) Therefore, in light of this demonstration of the 
        crisis in our Nation, it is the sense of the Congress that 
        prevention of out-of-wedlock pregnancy and reduction in out-of-
        wedlock birth are very important Government interests and the 
        policy contained in provisions of this title is intended to 
        address the crisis.
    ``(b) State Option To Deny Assistance For Out-of-Wedlock Births to 
Minors.--At the option of the State, a State to which a grant is made 
under section 403 may provide that the grant shall not be used to 
provide assistance for a child born out-of-wedlock to an individual who 
has not attained 18 years of age, or for the individual, until the 
individual attains such age.
    ``(c) State Option To Deny Assistance for Children Born to Families 
Receiving Assistance.--At the option of the State, a State to which a 
grant is made under section 403 may provide that the grant shall not be 
used to provide assistance for a minor child who is born to--
            ``(1) a recipient of assistance under the program funded 
        under this part; or
            ``(2) an individual who received such benefits at any time 
        during the 10-month period ending with the birth of the child.
    ``(d) Requirement That Teenage Parents Live In an Adult-Supervised 
Setting and Attend School.--
            ``(1) In general.--A State to which a grant is made under 
        section 403 shall not use any part of the grant to provide 
        assistance to an individual described in paragraph (2) if--
                    ``(A) the individual and the minor child of the 
                individual do not reside in--
                            ``(i) a place of residence maintained by a 
                        parent, legal guardian, or other adult relative 
                        of such individual as such parent's, 
                        guardian's, or adult relative's own home; or
                            ``(ii) another adult-supervised setting; 
                        and
                    ``(B) the individual does not participate in--
                            ``(i) educational activities directed 
                        toward the attainment of a high school diploma 
                        or its equivalent; or
                            ``(ii) an alternative educational or 
                        training program that has been approved by the 
                        State.
            ``(2) Individual described.--An individual described in 
        this paragraph is an individual who--
                    ``(A) is under the age of 18 and is not married; 
                and
                    ``(B) has a minor child in his or her care.

``SEC. 407. STATE PENALTIES.

    ``(a) In General.--Subject to the provisions of subsection (b), the 
Secretary shall deduct from the grant otherwise payable under section 
403 the following penalties:
            ``(1) For use of grant in violation of this part.--If an 
        audit conducted under section 408 finds that an amount paid to 
        a State under section 403 for a fiscal year has been used in 
        violation of this part, then the Secretary shall reduce the 
        amount of the grant otherwise payable to the State under such 
        section for the immediately succeeding fiscal year quarter by 
        the amount so used, plus 5 percent of such grant (determined 
        without regard to this section).
            ``(2) For failure to submit required report.--
                    ``(A) In general.--If the Secretary determines that 
                a State has not, within 6 months after the end of a 
                fiscal year, submitted the report required by section 
                409 for the fiscal year, the Secretary shall reduce by 
                5 percent the amount of the grant that would (in the 
                absence of this section) be payable to the State under
                 section 403 for the immediately succeeding fiscal 
year.
                    ``(B) Rescission of penalty.--The Secretary shall 
                rescind a penalty imposed on a State under subparagraph 
                (A) with respect to a report for a fiscal year if the 
                State submits the report before the end of the 
                immediately succeeding fiscal year.
            ``(3) For failure to satisfy minimum participation rates.--
                    ``(A) In general.--If the Secretary determines that 
                a State has failed to satisfy the minimum participation 
                rates specified in section 404(a) for a fiscal year, 
                the Secretary shall reduce by not more than 5 percent 
                the amount of the grant that would (in the absence of 
                this section) be payable to the State under section 403 
                for the immediately succeeding fiscal year.
                    ``(B) Penalty based on severity of failure.--The 
                Secretary shall impose reductions under subparagraph 
                (A) on the basis of the degree of noncompliance.
            ``(4) For failure to participate in the income and 
        eligibility verification system.--If the Secretary determines 
        that a State program funded under this part is not 
        participating during a fiscal year in the income and 
        eligibility verification system required by section 1137, the 
        Secretary shall reduce by not more than 5 percent the amount of 
        the grant that would (in the absence of this section) be 
        payable to the State under section 403 for the immediately 
        succeeding fiscal year.
            ``(5) For failure to comply with paternity establishment 
        and child support enforcement requirements under part d.--
        Notwithstanding any other provision of this Act, if the 
        Secretary determines that the State agency that administers a 
        program funded under this part does not enforce the penalties 
        requested by the agency administering part D against recipients 
        of assistance under the State program who fail to cooperate in 
        establishing paternity in accordance with such part, the 
        Secretary shall reduce by not more than 5 percent the amount of 
        the grant that would (in the absence of this section) be 
        payable to the State under section 403 for the immediately 
        succeeding fiscal year.
            ``(6) For failure to timely repay a federal loan fund for 
        state welfare programs.--If the Secretary determines that a 
        State has failed to repay any amount borrowed from the Federal 
        Loan Fund for State Welfare Programs established under section 
        403(d) within the period of maturity applicable to such loan, 
        plus any interest owed on such loan, then the Secretary shall 
        reduce the amount of the grant otherwise payable to the State 
        under section 403 for the immediately succeeding fiscal year 
        quarter by the outstanding loan amount, plus the interest owed 
        on such outstanding amount.
    ``(b) Requirements.--
            ``(1) Limitation on amount of penalty.--
                    ``(A) In general.--In imposing the penalties 
                described in subsection (a), the Secretary shall not 
                reduce any quarterly payment to a State by more than 25 
                percent.
                    ``(B) Carryforward of unrecovered penalties.--To 
                the extent that subparagraph (A) prevents the Secretary 
                from recovering during a fiscal year the full amount of 
                all penalties imposed on a State under subsection (a) 
                for a prior fiscal year, the Secretary shall apply any 
                remaining amount of such penalties to the grant 
                otherwise payable to the State under section 403 for 
                the immediately succeeding fiscal year.
            ``(2) State funds to replace reductions in grant.--A State 
        which has a penalty imposed against it under subsection (a) 
        shall expend additional State funds in an amount equal to the 
        amount of the penalty for the purpose of providing assistance 
        under the State program under this part.
            ``(3) Reasonable cause for noncompliance.--The Secretary 
        may not impose a penalty on a State under subsection (a) if the 
        Secretary determines that the State has reasonable cause for 
        failing to comply with a requirement for which a penalty is 
        imposed under such subsection.
    ``(c) Certification of Amount of Penalties.--If the Secretary is 
required to reduce the amount of any grant under this section, the 
Secretary shall certify the amount of such reduction to the Secretary 
of the Treasury and the Secretary of the Treasury shall reduce the 
amount paid to the State under section 403 by such amount.
    ``(d) Effective Dates.--
            ``(1) In general.--The penalties described in paragraphs 
        (2) through (6) of subsection (a) shall apply with respect to 
        fiscal years beginning on or after October 1, 1996.
            ``(2) Misuse of funds.--The penalties described in 
        subsection (a)(1) shall apply with respect to fiscal years 
        beginning on or after October 1, 1995.

``SEC. 408. AUDITS.

    ``(a) In General.--Each State shall, not less than annually, audit 
the State expenditures from amounts received under this part. Such 
audit shall--
            ``(1) determine the extent to which such expenditures were 
        or were not expended in accordance with this part; and
            ``(2) be conducted by an approved entity (as defined in 
        subsection (b)) in accordance with generally accepted auditing 
        principles.
    ``(b) Approved Entity.--For purposes of subsection (a), the term 
`approved entity' means an entity that--
            ``(1) is approved by the Secretary of the Treasury;
            ``(2) is approved by the chief executive officer of the 
        State; and
            ``(3) is independent of any agency administering activities 
        funded under this part.
    ``(c) Audit Report.--Not later than 30 days following the 
completion of an audit under this subsection, a
 State shall submit a copy of the audit to the State legislature, the 
Secretary of the Treasury, and the Secretary of Health and Human 
Services.
    ``(d) Additional Accounting Requirements.--The provisions of 
chapter 75 of title 31, United States Code, shall apply to the audit 
requirements of this section.

``SEC. 409. DATA COLLECTION AND REPORTING.

    ``(a) In General.--Each State to which a grant is made under 
section 403 for a fiscal year shall, not later than 6 months after the 
end of fiscal year 1997, and each fiscal year thereafter, transmit to 
the Secretary the following aggregate information on families to which 
assistance was provided during the fiscal year under the State program 
operated under this part:
            ``(1) The number of adults receiving such assistance.
            ``(2) The number of children receiving such assistance and 
        the average age of the children.
            ``(3) The employment status of such adults, and the average 
        earnings of employed adults receiving such assistance.
            ``(4) The age, race, and educational attainment at the time 
        of application for assistance of the adults receiving such 
        assistance.
            ``(5) The average amount of cash and other assistance 
        provided to the families under the program.
            ``(6) The number of months, since the most recent 
        application for assistance under the program, for which such 
        assistance has been provided to the families.
            ``(7) The total number of months for which assistance has 
        been provided to the families under the program.
            ``(8) Any other data necessary to indicate whether the 
        State is in compliance with the plan most recently submitted by 
        the State pursuant to section 402.
            ``(9) The components of any program carried out by the 
        State to provide work activities in order to comply with 
        section 404, and the average monthly number of adults in each 
        such component.
            ``(10) The number of part-time job placements and the 
        number of full-time job placements made through the program 
        referred to in paragraph (9), the number of cases with reduced 
        assistance, and the number of cases closed due to employment.
            ``(11) The number of cases closed due to section 405(b).
            ``(12) The increase or decrease in the number of children 
        born out of wedlock to recipients of assistance under the State 
        program funded under this part and the State's success in 
        meeting its goals established under section 402(a)(1)(F).
    ``(b) Authority of States To Use Estimates.--A State may comply 
with the requirement to provide precise numerical information described 
in subsection (a) by submitting an estimate which is obtained through 
the use of scientifically acceptable sampling methods.
    ``(c) Report on Use of Federal Funds To Cover Administrative Costs 
and Overhead.--The report required by subsection (a) for a fiscal year 
shall include a statement of--
            ``(1) the total amount and percentage of the Federal funds 
        paid to the State under this part for the fiscal year that are 
        used to cover administrative costs or overhead; and
            ``(2) the total amount of State funds that are used to 
        cover such costs or overhead.
    ``(d) Report on State Expenditures on Programs for Needy 
Families.--The report required by subsection (a) for a fiscal year 
shall include a statement of the total amount expended by the State 
during the fiscal year on the program under this part and the purposes 
for which such amount was spent.
    ``(e) Report on Noncustodial Parents Participating in Work 
Activities.--The report required by subsection (a) for a fiscal year 
shall include the number of noncustodial parents in the State who 
participated in work activities during the fiscal year.
    ``(f) Report on Child Support Collected.--The report required by 
subsection (a) for a fiscal year shall include the total amount of 
child support collected by the State agency administering the State 
program under part D on behalf of a family receiving assistance under 
this part.
    ``(g) Report on Child Care.--The report required by subsection (a) 
for a fiscal year shall include the total amount expended by the State 
for child care under the program under this part, along with a 
description of the types of child care provided, including child care 
provided in the case of a family that--
            ``(1) has ceased to receive assistance under this part 
        because of employment; or
            ``(2) is not receiving assistance under this part but would 
        be at risk of becoming eligible for such assistance if child 
        care was not provided.
    ``(h) Report on Transitional Services.--The report required by 
subsection (a) for a fiscal year shall include the total amount 
expended by the State for providing transitional services to a family 
that has ceased to receive assistance under this part because of 
employment, along with a description of such services.
    ``(i) Secretary's Report on Data Processing.--
            ``(1) In general.--Not later than 6 months after the date 
        of the enactment of the Work Opportunity Act of 1995, the 
        Secretary shall prepare and submit to the Congress a report 
        on--
                    ``(A) the status of the automated data processing 
                systems operated by the States to assist management in 
                the administration of State programs under this part 
                (whether in effect before or after October 1, 1995); 
                and
                    ``(B) what would be required to establish a system 
                capable of--
                            ``(i) tracking participants in public 
                        programs over time; and
                            ``(ii) checking case records of the States 
                        to determine whether individuals are 
                        participating in public programs in 2 or more 
                        States.
            ``(2) Preferred contents.--The report required by paragraph 
        (1) should include--
                    ``(A) a plan for building on the automated data 
                processing systems of the States to establish a system 
                with the capabilities described in paragraph (1)(B); 
                and
                    ``(B) an estimate of the amount of time required to 
                establish such a system and of the cost of establishing 
                such a system.

``SEC. 410. RESEARCH, EVALUATIONS, AND NATIONAL STUDIES.

    ``(a) Research.--The Secretary may conduct research on the effects 
and costs of State programs funded under this part.
    ``(b) Development and Evaluation of Innovative Approaches To 
Employing Welfare Recipients.--The Secretary may assist States in 
developing, and shall evaluate, innovative approaches to employing 
recipients of assistance under programs funded under this part. In 
performing such evaluations, the Secretary shall, to the maximum extent 
feasible, use random assignment to experimental and control groups.
    ``(c) Studies of Welfare Caseloads.--The Secretary may conduct 
studies of the caseloads of States operating programs funded under this 
part.
    ``(d) Dissemination of Information.--The Secretary shall develop 
innovative methods of disseminating information on any research, 
evaluations, and studies conducted under this section, including the 
facilitation of the sharing of information and best practices among 
States and localities through the use of computers and other 
technologies.
    ``(e) Annual Ranking of States and Review of Most and Least 
Successful Work Programs.--
            ``(1) Annual ranking of states.--The Secretary shall rank 
        annually the States to which grants are paid under section 403 
        in the order of their success in moving recipients of 
        assistance under the State program funded under this part into 
        long-term private sector jobs.
            ``(2) Annual review of most and least successful work 
        programs.--The Secretary shall review the programs of the 3 
        States most recently ranked highest under paragraph (1) and the 
        3 States most recently ranked lowest under paragraph (1) that 
        provide parents with work experience, assistance in finding 
        employment, and other work preparation activities and support 
        services to enable the families of such parents to leave the 
        program and become self-sufficient.
    ``(f) Study on Alternative Outcomes Measures.--
            ``(1) Study.--The Secretary shall, in cooperation with the 
        States, study and analyze outcomes measures for evaluating the 
        success of a State in moving individuals out of the welfare 
        system through employment as an alternative to the minimum 
        participation rates described in section 404. The study shall 
        include a determination as to whether such alternative outcomes 
        measures should be applied on a national or a State-by-State 
        basis.
            ``(2) Report.--Not later than September 30, 1998, the 
        Secretary shall submit to the Committee on Finance of the 
        Senate and the Committee on Ways and Means of the House of 
        Representatives a report containing the findings of the study 
        described in paragraph (1).
``SEC. 411. STUDY BY THE CENSUS BUREAU.

    ``(a) In General.--The Bureau of the Census shall expand the Survey 
of Income and Program Participation as necessary to obtain such 
information as will enable interested persons to evaluate the impact of 
the amendments made by title I of the Work Opportunity Act of 1995 on a 
random national sample of recipients of assistance under State programs 
funded under this part and (as appropriate) other low-income families, 
and in doing so, shall pay particular attention to the issues of out-
of-wedlock births, welfare dependency, the beginning and end of welfare 
spells, and the causes of repeat welfare spells.
    ``(b) Appropriation.--Out of any money in the Treasury of the 
United States not otherwise appropriated, the Secretary of the Treasury 
shall pay to the Bureau of the Census $10,000,000 for each of fiscal 
years 1996, 1997, 1998, 1999, and 2000 to carry out subsection (a).

``SEC. 412. WAIVERS.

    ``(a) Continuation of Waivers.--
            ``(1) In general.--Except as provided in paragraph (2), if 
        any waiver granted to a State under section 1115 or otherwise 
        which relates to the provision of assistance under a State plan 
        under this part is in effect or approved by the Secretary as of 
        October 1, 1995, the amendments made by the Work Opportunity 
        Act of 1995 shall not apply with respect to the State before 
        the expiration (determined without regard to any extensions) of 
        the waiver to the extent such amendments are inconsistent with 
        the terms of the waiver.
            ``(2) Financing limitation.--Notwithstanding any other 
        provision of law, beginning with fiscal year 1996, a State 
        operating under a waiver described in paragraph (1) shall 
        receive the payment described for such State for such fiscal 
        year under section 403, in lieu of any other payment provided 
        for in the waiver.
    ``(b) State Option To Terminate Waiver.--
            ``(1) In general.--A State may terminate a waiver described 
        in subsection (a) before the expiration of the waiver.
            ``(2) Report.--A State which terminates a waiver under 
        paragraph (1) shall submit a report to the Secretary 
        summarizing the waiver and any available information concerning 
        the result or effect of such waiver.
            ``(3) Hold harmless provision.--
                    ``(A) In general.--A State that, not later than the 
                date described in subparagraph (B), submits a written 
                request to terminate a waiver described in subsection 
                (a) shall be held harmless for accrued cost neutrality 
                liabilities incurred under the terms and conditions of 
                such waiver.
                    ``(B) Date described.--The date described in this 
                subparagraph is the later of--
                            ``(i) January 1, 1996; or
                            ``(ii) 90 days following the adjournment of 
                        the first regular session of the State 
                        legislature that begins after the date of the 
                        enactment of the Work Opportunity Act of 1995.
    ``(c) Secretarial Encouragement of Current Waivers.--The Secretary 
shall encourage any State operating a waiver described in subsection 
(a) to continue such waiver and to evaluate, using random sampling and 
other characteristics of accepted scientific evaluations, the result or 
effect of such waiver.

``SEC. 413. STATE DEMONSTRATION PROGRAMS.

    ``Nothing in this part shall be construed as limiting a State's 
ability to conduct demonstration projects for the purpose of 
identifying innovative or effective program designs in 1 or more 
political subdivisions of the State.

``SEC. 414. DIRECT FUNDING AND ADMINISTRATION BY INDIAN TRIBES.

    ``(a) Purpose.--The purpose of this section is--
            ``(1) to strengthen and enhance the control and flexibility 
        of local governments over local programs; and
            ``(2) in recognition of the principles contained in the 
        Indian Self-Determination and Education Assistance Act (25 
        U.S.C. 450 et seq.)--
                    ``(A) to provide direct Federal funding to Indian 
                tribes for the tribal administration of the program 
                funded under this part; or
                    ``(B) to enable Indian tribes to enter into 
                agreements, contracts, or compacts with intertribal 
                consortia, States, or other entities for the 
                administration of such program on behalf of the Indian 
                tribe.
    ``(b) Grant Amounts for Indian Tribes.--
            ``(1) In general.--For each of fiscal years 1996, 1997, 
        1998, 1999, and 2000, the Secretary shall pay to each Indian 
        tribe that has an approved tribal family assistance plan a 
        tribal family assistance grant for the fiscal year in an amount 
        equal to the amount determined under paragraph (2).
            ``(2) Amount determined.--
                    ``(A) In general.--The amount determined under this 
                paragraph is an amount equal to the total amount of the 
                Federal payments to a State or States under section 403 
                for fiscal year 1994 (as in effect during such fiscal 
                year) attributable to expenditures by the State or 
                States under part A and part F of this title (as so in 
                effect) in such year for Indian families residing in 
                the service area or areas identified by the Indian 
                tribe in subsection (c)(1)(C).
                    ``(B) Use of State submitted data.--
                            ``(i) In general.--The Secretary shall use 
                        State submitted data to make each determination 
                        under subparagraph (A).
                            ``(ii) Disagreement with determination.--If 
                        an Indian tribe or tribal organization 
                        disagrees with State submitted data described 
                        under clause (i), the Indian tribe or tribal 
                        organization may submit to the Secretary such 
                        additional information as may be relevant to 
                        making the determination under subparagraph (A) 
                        and the Secretary may consider such information 
                        before making such determination.
    ``(c) 3-Year Tribal Family Assistance Plan.--
            ``(1) In general.--Any Indian tribe that desires to receive 
        a tribal family assistance grant shall submit to the Secretary 
        a 3-year tribal family assistance plan that--
                    ``(A) outlines the Indian tribe's approach to 
                providing welfare-related services for the 3-year 
                period, consistent with the purposes of this section;
                    ``(B) specifies whether the welfare-related 
                services provided under the plan will be provided by 
                the Indian tribe or through agreements, contracts, or 
                compacts with intertribal consortia, States, or other 
                entities;
                    ``(C) identifies the population and service area or 
                areas to be served by such plan;
                    ``(D) provides that a family receiving assistance 
                under the plan may not receive duplicative assistance 
                from other State or tribal programs funded under this 
                part;
                    ``(E) identifies the employment opportunities in or 
                near the service area or areas of the Indian tribe and 
                the manner in which the Indian tribe will cooperate and 
                participate in enhancing such opportunities for 
                recipients of assistance under the plan consistent with 
                any applicable State standards; and
                    ``(F) applies the fiscal accountability provisions 
                of section 5(f)(1) of the Indian Self-Determination and 
                Education Assistance Act (25 U.S.C. 450c(f)(1)), 
                relating to the submission of a single-agency audit 
                report required by chapter 75 of title 31, United 
                States Code.
            ``(2) Approval.--The Secretary shall approve each tribal 
        family assistance plan submitted in accordance with paragraph 
        (1).
            ``(3) Consortium of tribes.--Nothing in this section shall 
        preclude the development and submission of a single plan by the 
        participating Indian tribes of an intertribal consortium.
    ``(d) Minimum Work Participation Requirements and Time Limits.--The 
Secretary, with the participation of Indian tribes, shall establish for 
each Indian tribe receiving a grant under this section minimum work 
participation requirements, appropriate time limits for receipt of 
welfare-related services under such grant, and penalties against 
individuals--
            ``(1) consistent with the purposes of this section;
            ``(2) consistent with the economic conditions and resources 
        available to each tribe; and
            ``(3) similar to comparable provisions in section 404(d).
    ``(e) Emergency Assistance.--Nothing in this section shall preclude 
an Indian tribe from seeking emergency
 assistance from any Federal loan program or emergency fund.
    ``(f) Accountability.--Nothing in this section shall be construed 
to limit the ability of the Secretary to maintain program funding 
accountability consistent with--
            ``(1) generally accepted accounting principles; and
            ``(2) the requirements of the Indian Self-Determination and 
        Education Assistance Act (25 U.S.C. 450 et seq.).
    ``(g) Tribal Penalties.--For the purpose of ensuring the proper use 
of tribal family assistance grants, the following provisions shall 
apply to an Indian tribe with an approved tribal assistance plan:
            ``(1) The provisions of subsections (a)(1), (a)(6), and (b) 
        of section 407, in the same manner as such subsections apply to 
        a State.
            ``(2) The provisions of section 407(a)(3), except that such 
        subsection shall be applied by substituting `the minimum 
        requirements established under subsection (d) of section 414' 
        for `the minimum participation rates specified in section 404'.
    ``(h) Data Collection and Reporting.--For the purpose of ensuring 
uniformity in data collection, section 409 shall apply to an Indian 
tribe with an approved tribal family assistance plan.''.
``SEC. 415. ASSISTANT SECRETARY FOR FAMILY SUPPORT.

    ``The programs under this part and part D of this title shall be 
administered by an Assistant Secretary for Family Support within the 
Department of Health and Human Services, who shall be appointed by the 
President, by and with the advice and consent of the Senate, and who 
shall be in addition to any other Assistant Secretary of Health and 
Human Services provided for by law.

``SEC. 416. LIMITATION ON FEDERAL AUTHORITY.

    ``The Secretary of Health and Human Services and the Secretary of 
the Treasury may not regulate the conduct of States under this part or 
enforce any provision of this part, except to the extent expressly 
provided in this part.''.
SEC. 102. SERVICES PROVIDED BY CHARITABLE, RELIGIOUS, OR PRIVATE 
              ORGANIZATIONS.

    (a) In General.--Notwithstanding any other provision of law, a 
State is permitted to contract with charitable, religious, or private 
organizations to provide services and administer programs established 
or modified under this Act.
    (b) Religious Organizations.--The purpose of this section is to 
allow the participation of religious organizations which contract to 
provide services under this Act on the same basis as any other provider 
without impairing the religious character of such organizations, and 
without diminishing the religious freedom of beneficiaries of 
assistance funded under any program established or modified under this 
Act.
    (c) Nondiscrimination Against Religious Organizations.--Religious 
organizations are eligible as contractors to provide assistance under 
any program established or modified under this Act to needy families 
and children in accordance with this section. Neither the Federal 
Government nor a State receiving funds under such programs shall 
discriminate against an organization which is or applies to be a 
contractor to provide assistance on the basis that the organization has 
a religious character.
    (d) Religious Character and Freedom.--
            (1) Religious organizations.--Notwithstanding any other 
        provision of law, any religious organization with a contract 
        described in subsection (a) shall retain its independence from 
        Federal, State, and local governments, including such 
        organization's control over the definition, development, 
        practice, and expression of its religious beliefs.
            (2) Additional safeguards.--Neither the Federal Government 
        nor a State shall require a religious organization contracting 
        to provide assistance to--
                    (A) alter its form of internal governance, or form 
                a separate, nonprofit corporation to receive and 
                administer the assistance funded under this part; or
                    (B) remove religious art, icons, scripture, or 
                other symbols;
        in order to be eligible to be a provider of assistance funded 
        under this part.
    (e) Nondiscrimination in Employment.--
            (1) In general.--Except as provided in paragraph (2), 
        nothing in this section shall be construed to modify or affect 
        the provisions of any other Federal law or regulation that 
        relates to discrimination in employment on the basis of 
        religion.
            (2) Exception.--A religious organization with a contract 
        described in subsection (a) may require that employees 
        rendering service pursuant to such contract adhere to the 
        religious tenets and teachings of such organization, and such 
        organization may require that employees adhere to rules 
        forbidding the use of drugs or alcohol.
    (f) Nondiscrimination Against Beneficiaries.--A religious 
organization shall not discriminate against needy families and children 
in regard to rendering assistance funded under any program established 
or modified under this Act on the basis of religion, a religious 
belief, or refusal to participate in a religious practice.
    (g) Fiscal Accountability.--
            (1) In general.--Except as provided in paragraph (2), any 
        religious organization contracting to provide assistance funded 
        under any program established or modified under this Act shall 
        be subject to the same regulations as other contractors to 
        account in accord with generally accepted auditing principles 
        for the use of such funds provided under such programs.
            (2) Limited audit.--If such organization segregates Federal 
        funds provided under such programs into separate accounts, then 
        only the financial assistance provided with such funds shall be 
        subject to audit.
    (h) Compliance.--A religious organization which has its rights 
under this section violated may enforce its claim exclusively by 
asserting a civil action for such relief as may be appropriate, 
including injunctive relief or damages, in an appropriate State court 
against the entity or agency that allegedly commits such violation.
    (i) Rights of Beneficiaries of Assistance.--If a beneficiary has an 
objection to the religious character of the organization or institution 
from which the beneficiary is receiving assistance funded under any 
program established or modified under this Act, each State shall 
provide such beneficiary assistance from an alternative provider the 
value of which is not less than the value of the assistance which the 
individual would have received from the organization.

SEC. 103. LIMITATIONS ON USE OF FINANCIAL ASSISTANCE FOR CERTAIN 
              PURPOSES.

    No financial assistance provided under programs established or 
modified by this Act shall be expended for any sectarian purpose or 
activity, including sectarian worship or instruction.

SEC. 104. CONTINUED APPLICATION OF CURRENT STANDARDS UNDER MEDICAID 
              PROGRAM.

    (a) In General.--Title XIX (42 U.S.C. 1396 et seq.) is amended--
            (1) in section 1931, by inserting ``subject to section 
        1931(a),'' after ``under this title,'' and by redesignating 
        such section as section 1932; and
            (2) by inserting after section 1930 the following new 
        section:

               ``continued application of afdc standards

    ``Sec. 1931. (a) For purposes of applying this title on and after 
October 1, 1995, with respect to a State--
            ``(1) except as provided in paragraph (2), any reference in 
        this title (or other provision of law in relation to the 
        operation of this title) to a provision of part A of title IV 
        of this Act, or a State plan under such part, shall be 
        considered a reference to such provision or plan as in effect 
        as of June 1, 1995, with respect to the State and eligibility 
        for medical assistance under this title shall be determined as 
        if such provision or plan (as in effect as of such date) had 
        remained in effect on and after October 1, 1995; and
            ``(2) any reference in section 1902(a)(5) or 1902(a)(55) to 
        a State plan approved under part A of title IV shall be deemed 
        a reference to a State program funded under such part (as in 
        effect on and after October 1, 1995).
    ``(b) In the case of a waiver of a provision of part A of title IV 
in effect with respect to a State as of June 1, 1995, if the waiver 
affects eligibility of individuals for medical assistance under this 
title, such waiver may, at the option of the State, continue to be 
applied in relation to this title after the date the waiver would 
otherwise expire.''.
    (b) Plan Amendment.--Section 1902(a) (42 U.S.C. 1396a(a)) is 
amended--
            (1) by striking ``and'' at the end of paragraph (61);
            (2) by striking the period at the end of paragraph (62) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (62) the following new 
        paragraph:
            ``(63) provide for continuing to administer eligibility 
        standards with respect to individuals who are (or seek to be) 
        eligible for medical assistance based on the application of 
        section 1931.''.
    (c) Conforming Amendments.--(1) Section 1902(c) (42 U.S.C. 
1396a(c)) is amended by striking ``if--'' and all that follows and 
inserting the following: ``if the State requires individuals described 
in subsection (l)(1) to apply for assistance under the State program 
funded under part A of title IV as a condition of applying for or 
receiving medical assistance under this title.''.
    (2) Section 1903(i) (42 U.S.C. 1396b(i)) is amended by striking 
paragraph (9).
    (d) Effective Date.--The amendments made by this section shall 
apply to medical assistance furnished for calendar quarters beginning 
on or after October 1, 1995.

SEC. 105. REDUCTION IN PERSONNEL.

    (a) In General.--The Secretary of Health and Human Services shall 
take such actions as may be necessary, including reduction in force 
actions, consistent with sections 3502 and 3595 of title 5, United 
States Code, to ensure that at least 30 percent of the personnel in 
positions that relate to a covered activity are separated from service.
    (b) Definition of Covered Activity.--For purposes of this section, 
the term covered activity means an activity authorized to be carried 
out under part A or F of the Social Security Act (42 U.S.C. 601 et seq. 
and 682 et seq.) as such parts were in effect prior to the date of the 
enactment of this Act but does not include any position in an Office of 
Inspector General that relates to the auditing or investigation of a 
covered activity.

SEC. 106. CONFORMING AMENDMENTS TO THE SOCIAL SECURITY ACT.

    (a) Amendments to Title II.--
            (1) Section 205(c)(2)(C)(vi) (42 U.S.C. 405(c)(2)(C)(vi)), 
        as so redesignated by section 321(a)(9)(B) of the Social 
        Security Independence and Program Improvements Act of 1994, is 
        amended--
                    (A) by inserting ``an agency administering a 
                program funded under part A of title IV or'' before 
                ``an agency operating''; and
                    (B) by striking ``A or D of title IV of this Act'' 
                and inserting ``D of such title''.
            (2) Section 228(d)(1) (42 U.S.C. 428(d)(1)) is amended by 
        inserting ``under a State program funded under'' before ``part 
        A of title IV''.
    (b) Amendment to Part B of Title IV.--Section 422(b)(2) (42 U.S.C. 
622(b)(2)) is amended by
 striking ``under the State plan approved'' and inserting ``under the 
State program funded.''.
    (c) Amendments to Part D of Title IV.--
            (1) Section 451 (42 U.S.C. 651) is amended by striking 
        ``aid'' and inserting ``assistance under a State program 
        funded''.
            (2) Section 452(a)(10)(C) (42 U.S.C. 652(a)(10)(C)) is 
        amended--
                    (A) by striking ``aid to families with dependent 
                children'' and inserting ``assistance under a State 
                program funded under part A'';
                    (B) by striking ``such aid'' and inserting ``such 
                assistance''; and
                    (C) by striking ``402(a)(26) or''.
            (3) Section 452(a)(10)(F) (42 U.S.C. 652(a)(10)(F)) is 
        amended--
                    (A) by striking ``aid under a State plan approved'' 
                and inserting ``assistance under a State program 
                funded''; and
                    (B) by striking ``in accordance with the standards 
                referred to in section 402(a)(26)(B)(ii)'' and 
                inserting ``by the State''.
            (4) Section 452(b) (42 U.S.C. 652(b)) is amended in the 
        first sentence by striking ``aid under the State plan approved 
        under part A'' and inserting ``assistance under a State program 
        funded under part A''.
            (5) Section 452(d)(3)(B)(i) (42 U.S.C. 652(d)(3)(B)(i)) is 
        amended by striking ``1115(c)'' and inserting ``1115(b)''.
            (6) Section 452(g)(2)(A)(ii)(I) (42 U.S.C. 
        652(g)(2)(A)(ii)(I)) is amended by striking ``aid is being paid 
        under the State's plan approved under part A or E'' and 
        inserting ``assistance is being provided under the State 
        program funded under part A or aid is being paid under the 
        State's plan approved under part E''.
            (7) Section 452(g)(2)(A) (42 U.S.C. 652(g)(2)(A)) is 
        amended in the matter following clause (iii) by striking ``aid 
        was being paid under the State's plan approved under part A or 
        E'' and inserting ``assistance was being provided under the 
        State program funded under part A or aid was being paid under 
        the State's plan approved under part E''.
            (8) Section 452(g)(2) (42 U.S.C. 652(g)(2)) is amended in 
        the matter following subparagraph (B)--
                    (A) by striking ``who is a dependent child by 
                reason of the death of a parent'' and inserting ``with 
                respect to whom assistance is being provided under the 
                State program funded under part A'';
                    (B) by inserting ``by the State agency 
                administering the State plan approved under this part'' 
                after ``found''; and
                    (C) by striking ``under section 402(a)(26)'' and 
                inserting ``with the State in establishing paternity''.
            (9) Section 452(h) (42 U.S.C. 652(h)) is amended by 
        striking ``under section 402(a)(26)''.
            (10) Section 453(c)(3) (42 U.S.C. 653(c)(3)) is amended by 
        striking ``aid'' and inserting ``assistance under a State 
        program funded''.
            (11) Section 454 (42 U.S.C. 654)) is amended--
                    (A) in paragraph (5)(A)--
                            (i) by striking ``under section 
                        402(a)(26)''; and
                            (ii) by striking ``except that this 
                        paragraph shall not apply to such payments for 
                        any month following the first month in which 
                        the amount collected is sufficient to make such 
                        family ineligible for assistance under the 
                        State plan approved under part A;''; and
                    (B) in paragraph (6)(D), by striking ``aid under a 
                State plan approved'' and inserting ``assistance under 
                a State program funded''.
            (12) Section 456 (42 U.S.C. 656) is amended--
                    (A) in subsection (a)(1), by striking ``under 
                section 402(a)(26)''; and
                    (B) by striking subsection (b) and inserting the 
                following:
    ``(b) A debt which is a support obligation enforceable under this 
title is not released by a discharge in bankruptcy under title 11, 
United States Code.''.
            (13) Section 466(a)(3)(B) (42 U.S.C. 666(a)(3)(B)) is 
        amended by striking ``402(a)(26) or''.
            (14) Section 466(b)(2) (42 U.S.C. 666(b)(2)) is amended by 
        striking ``aid'' and inserting ``assistance under a State 
        program funded''.
            (15) Section 469(a) (42 U.S.C. 669(a)) is amended--
                    (A) by striking ``aid under plans approved'' and 
                inserting ``assistance under State programs funded''; 
                and
                    (B) by striking ``such aid'' and inserting ``such 
                assistance''.
    (d) Amendments to Part E of Title IV.--
            (1) Section 470 (42 U.S.C. 670) is amended--
                    (A) by striking ``would be'' and inserting ``would 
                have been''; and
                    (B) by inserting ``(as such plan was in effect on 
                June 1, 1995)'' after ``part A''.
            (2) Section 471(17) (42 U.S.C. 671(17)) is amended by 
        striking ``plans approved under parts A and D'' and inserting 
        ``program funded under part A and plan approved under part D''.
            (3) Section 472(a) (42 U.S.C. 672(a)) is amended--
                    (A) in the matter preceding paragraph (1)--
                            (i) by striking ``would meet'' and 
                        inserting ``would have met'';
                            (ii) by inserting ``(as such sections were 
                        in effect on June 1, 1995)'' after ``407''; and
                            (iii) by inserting ``(as so in effect)'' 
                        after ``406(a)''; and
                    (B) in paragraph (4)--
                            (i) in subparagraph (A)--
                                    (I) by inserting ``would have'' 
                                after ``(A)''; and
                                    (II) by inserting ``(as in effect 
                                on June 1, 1995)'' after ``section 
                                402''; and
                            (ii) in subparagraph (B)(ii), by inserting 
                        ``(as in effect on June 1, 1995)'' after 
                        ``406(a)''.
            (4) Section 472(h) (42 U.S.C. 672(h)) is amended to read as 
        follows:
    ``(h)(1) For purposes of title XIX, any child with respect to whom 
foster care maintenance payments are made under this section shall be 
deemed to be a dependent child as defined in section 406 (as in effect 
as of June 1, 1995) and shall be deemed to be a recipient of aid to 
families with dependent children under part A of this title (as so in 
effect). For purposes of title XX, any child with respect to whom 
foster care maintenance payments are made under this section shall be 
deemed to be a minor child in a needy family under a State program 
funded under part A and shall be deemed to be a recipient of assistance 
under such part.
    ``(2) For purposes of paragraph (1), a child whose costs in a 
foster family home or child care institution are covered by the foster 
care maintenance payments being made with respect to the child's minor 
parent, as provided in section 475(4)(B), shall be considered a child 
with respect to whom foster care maintenance payments are made under 
this section.''.
            (5) Section 473(a)(2) (42 U.S.C. 673(a)(2)) is amended--
                    (A) in subparagraph (A)(i)--
                            (i) by inserting ``(as such sections were 
                        in effect on June 1, 1995)'' after ``407'';
                            (ii) by inserting ``(as so in effect)'' 
                        after ``specified in section 406(a)''; and
                            (iii) by inserting ``(as such section was 
                        in effect on June 1, 1995)'' after ``403'';
                    (B) in subparagraph (B)(i)--
                            (i) by inserting ``would have'' after 
                        ``(B)(i)''; and
                            (ii) by inserting ``(as in effect on June 
                        1, 1995)'' after ``section 402''; and
                    (C) in subparagraph (B)(ii)(II), by inserting ``(as 
                in effect on June 1, 1995)'' after ``406(a)''.
            (6) Section 473(b) (42 U.S.C. 673(b)) is amended to read as 
        follows:
    ``(b)(1) For purposes of title XIX, any child who is described in 
paragraph (3) shall be deemed to be a dependent child as defined in 
section 406 (as in effect as of June 1, 1995) and shall be deemed to be 
a recipient of aid to families with dependent children under part A of 
this title (as so in effect) in the State where such child resides.
    ``(2) For purposes of title XX, any child who is described in 
paragraph (3) shall be deemed to be a minor child in a needy family 
under a State program funded under part A and shall be deemed to be a 
recipient of assistance under such part.
    ``(3) A child described in this paragraph is any child--
            ``(A)(i) who is a child described in subsection (a)(2), and
            ``(ii) with respect to whom an adoption assistance 
        agreement is in effect under this section (whether or nor 
        adoption assistance payments are provided under the agreement 
        or are being made under this section), including any such child 
        who has been placed for adoption in accordance with applicable 
        State and local law (whether or not an interlocutory or other 
        judicial decree of adoption has been issued), or
            ``(B) with respect to whom foster care maintenance payments 
        are being made under section 472.
    ``(4) For purposes of paragraphs (1) and (2), a child whose costs 
in a foster family home or child-care institution are covered by the 
foster care maintenance payments being made with respect to the child's 
minor parent, as provided in section 475(4)(B), shall be considered a 
child with respect to whom foster care maintenance payments are being 
made under section 472.''.
            (7) Section 474 (42 U.S.C. 674) is amended by adding at the 
        end the following new subsection:
    ``(d) Notwithstanding any other provision of this part, a State may 
not receive payment under this section with respect to an individual 
receiving assistance under this part as a result of such individual's 
eligibility under the State plan approved under part A (as in effect on 
June 1, 1995) unless such individual would also be eligible to receive 
assistance under the State program operated under part A as such plan 
is in effect on and after October 1, 1995.''.
    (e) Amendment to Title X.--Section 1002(a)(7) (42 U.S.C. 
1202(a)(7)) is amended by striking ``aid to families with dependent 
children under the State plan approved under section 402 of this Act'' 
and inserting ``assistance under a State program funded under part A of 
title IV''.
    (f) Amendments to Title XI.--
            (1) Section 1109 (42 U.S.C. 1309) is amended by striking 
        ``or part A of title IV,''.
            (2) Section 1115 (42 U.S.C. 1315) is amended--
                    (A) in subsection (a)(2)--
                            (i) by inserting ``(A)'' after ``(2)'';
                            (ii) by striking ``403,'';
                            (iii) by striking the period at the end and 
                        inserting ``, and''; and
                            (iv) by adding at the end the following new 
                        subparagraph:
            ``(B) costs of such project which would not otherwise be a 
        permissible use of funds under part A of title IV and which are 
        not included as part of the costs of projects under section 
        1110, shall to the extent and for the period prescribed by the 
        Secretary, be regarded as a permissible use of funds under such 
        part.''; and
                    (B) in subsection (c)(3), by striking ``under the 
                program of aid to families with dependent children'' 
                and inserting ``part A of such title''.
            (3) Section 1116 (42 U.S.C. 1316) is amended--
                    (A) in each of subsections (a)(1), (b), and (d), by 
                striking ``or part A of title IV,''; and
                    (B) in subsection (a)(3), by striking ``404,''.
            (4) Section 1118 (42 U.S.C. 1318) is amended--
                    (A) by striking ``403(a),'';
                    (B) by striking ``and part A of title IV,''; and
                    (C) by striking ``, and shall, in the case of 
                American Samoa, mean 75 per centum with respect to part 
                A of title IV''.
            (5) Section 1119 (42 U.S.C. 1319) is amended--
                    (A) by striking ``or part A of title IV''; and
                    (B) by striking ``403(a),''.
            (6) Section 1133(a) (42 U.S.C. 1320b-3(a)) is amended by 
        striking ``or part A of title IV,''.
            (7) Section 1136 (42 U.S.C. 1320b-6) is repealed.
            (8) Section 1137 (42 U.S.C. 1320b-7) is amended--
                    (A) in subsection (b), by striking paragraph (1) 
                and inserting the following:
            ``(1) any State program funded under part A of title IV of 
        this Act;''; and
                    (B) in subsection (d)(1)(B)--
                            (i) by striking ``In this subsection--'' 
                        and all that follows through ``(ii) in'' and 
                        inserting ``In this subsection, in'';
                            (ii) by redesignating subclauses (I), (II), 
                        and (III) as clauses (i), (ii), and (iii); and
                            (iii) by moving such redesignated material 
                        2 ems to the left.
            (9) Section 1108 (42 U.S.C. 1308) is amended--
                    (A) in subsection (a)--
                            (i) in the matter preceding paragraph (1)--
                                    (I) by inserting ``(or paid, in the 
                                case of part A of title IV); and
                                    (II) by striking ``or, in the case 
                                of'' and all that follows through 
                                ``section 403(k)'';
                            (ii) in paragraph (1)--
                                    (I) in subparagraph (F), by 
                                striking ``or'';
                                    (II) in subparagraph (G), by 
                                striking ``the fiscal year 1989 and 
                                each fiscal year thereafter;'' and 
                                inserting ``each of the fiscal years 
                                1989 through 1995, or''; and
                                    (III) by inserting after 
                                subparagraph (G), the following new 
                                subparagraph:
                    ``(H) $92,250,000 with respect to fiscal year 1996 
                and each fiscal year thereafter;'';
                            (iii) in paragraph (2)--
                                    (I) in subparagraph (F), by 
                                striking ``or'';
                                    (II) in subparagraph (G), by 
                                striking ``the fiscal year 1989 and 
                                each fiscal year thereafter;'' and 
                                inserting ``each of the fiscal years 
                                1989 through 1995, or''; and
                                    (III) by inserting after 
                                subparagraph (G), the following new 
                                subparagraph:
                    ``(H) $3,150,000 with respect to fiscal year 1996 
                and each fiscal year thereafter;''; and
                            (iv) in paragraph (3)--
                                    (I) in subparagraph (F), by 
                                striking ``or'';
                                    (II) in subparagraph (G), by 
                                striking ``the fiscal year 1989 and 
                                each fiscal year thereafter.'' and 
                                inserting ``each of the fiscal years 
                                1989 through 1995, or''; and
                                    (III) by inserting after 
                                subparagraph (G), the following new 
                                subparagraph:
                    ``(H) $4,275,000 with respect to fiscal year 1996 
                and each fiscal year thereafter.''; and
                    (B) in subsection (d), by striking ``(exclusive of 
                any amounts'' and all that follows through ``section 
                403(k) applies)''.
    (g) Amendment to Title XIV.--Section 1402(a)(7) (42 U.S.C. 
1352(a)(7)) is amended by striking ``aid to families with dependent 
children under the State plan approved under section 402 of this Act'' 
and inserting ``assistance under a State program funded under part A of 
title IV''.
    (h) Amendment to Title XVI as in Effect With Respect to the 
Territories.--Section 1602(a)(11), as in effect without regard to the 
amendment made by section 301 of the Social Security Amendments of 1972 
(42 U.S.C. 1382 note), is amended by striking ``aid under the State 
plan approved'' and inserting ``assistance under a State program 
funded''.
    (i) Amendment to Title XVI as in Effect With Respect to the 
States.--Section 1611(c)(5)(A) (42 U.S.C. 1382(c)(5)(A)) is amended to 
read as follows: ``(A) a State program funded under part A of title 
IV,''.

SEC. 107. CONFORMING AMENDMENTS TO THE FOOD STAMP ACT OF 1977 AND 
              RELATED PROVISIONS.

    (a) Section 5 of the Food Stamp Act of 1977 (7 U.S.C. 2014) is 
amended--
            (1) in the second sentence of subsection (a), by striking 
        ``plan approved'' and all that follows through ``title IV of 
        the Social Security Act'' and inserting ``program funded under 
        part A of title IV of the Social Security Act (42 U.S.C. 601 et 
        seq.) that the Secretary determines complies with standards 
        established by the Secretary that ensure that the standards 
        under the State program are comparable to or more restrictive 
        than those in effect on June 1, 1995'';
            (2) in subsection (d)(5)--
                    (A) by striking ``assistance to families with 
                dependent children'' and inserting ``assistance under a 
                State program funded''; and
                    (B) by striking paragraph (13) and redesignating 
                paragraphs (14), (15), and (16) as paragraphs (13), 
                (14), and (15), respectively;
            (3) in subsection (j), by striking ``plan approved under 
        part A of title IV of such Act (42 U.S.C. 601 et seq.)'' and 
        inserting ``program funded under part A of title IV of the Act 
        (42 U.S.C. 601 et seq.) that the Secretary determines complies 
        with standards established by the Secretary that ensure that 
        the standards under the State program are comparable to or more 
        restrictive than those in effect on June 1, 1995''.
    (b) Section 6 of such Act (7 U.S.C. 2015) is amended--
            (1) in subsection (c)(5), by striking ``the State plan 
        approved'' and inserting ``the State program funded'';
            (2) in subsection (e)--
                    (A) by striking ``aid to families with dependent 
                children'' and inserting ``benefits under a State 
                program funded''; and
                    (B) by inserting before the semicolon the 
                following: ``that the Secretary determines complies 
                with standards established by the Secretary that ensure 
                that the standards under the State program are 
                comparable to or more restrictive than those in effect 
                on June 1, 1995''; and
            (3) by adding at the end the following new subsection:
    ``(i) Notwithstanding any other provision of this Act, a household 
may not receive benefits under this Act as a result of the household's 
eligibility under a State program funded under part A of title IV of 
the Social Security Act (42 U.S.C. 601 et seq.), unless the Secretary 
determines that any household with income above 130 percent of the 
poverty guidelines is not eligible for the program.''.
    (c) Section 16(g)(4) of such Act (7 U.S.C. 2025(g)(4)) is amended 
by striking ``State plans under the Aid to Families with Dependent 
Children Program under'' and inserting ``State programs funded under 
part A of''.
    (d) Section 17 of such Act (7 U.S.C. 2026) is amended--
            (1) in the first sentence of subsection (b)(1)(A), by 
        striking ``to aid to families with dependent children under 
        part A of title IV of the Social Security Act'' and inserting 
        ``or are receiving assistance under a State program funded 
        under part A of title IV of the Social Security Act (42 U.S.C. 
        601 et seq.)''; and
            (2) in subsection (b)(3), by adding at the end the 
        following new subparagraph:
             ``(I) The Secretary may not grant a waiver under this 
        paragraph on or after October 1, 1995. Any reference in this 
        paragraph to a provision of title IV of the Social Security Act 
        shall be deemed to be a reference to such provision as in 
        effect on September 30, 1995.'';
    (e) Section 20 of such Act (7 U.S.C. 2029) is amended--
            (1) in subsection (a)(2)(B) by striking ``operating--'' and 
        all that follows through ``(ii) any other'' and inserting 
        ``operating any''; and
            (2) in subsection (b)--
                    (A) in paragraph (1)--
                            (i) by striking ``(b)(1) A household'' and 
                        inserting ``(b) A household''; and
                            (ii) in subparagraph (B), by striking 
                        ``training program'' and inserting 
                        ``activity'';
                    (B) by striking paragraph (2); and
                    (C) by redesignating subparagraphs (A) through (F) 
                as paragraphs (1) through (6), respectively.
    (f) Section 5(h)(1) of the Agriculture and Consumer Protection Act 
of 1973 (Public Law 93-186; 7 U.S.C. 612c note) is amended by striking 
``the program for aid to families with dependent children'' and 
inserting ``the State program funded''.
    (g) Section 9 of the National School Lunch Act (42 U.S.C. 1758) is 
amended--
            (1) in subsection (b)--
                    (A) in paragraph (2)(C)(ii)(II)--
                            (i) by striking ``program for aid to 
                        families with dependent children'' and 
                        inserting ``State program funded''; and
                            (ii) by inserting before the period at the 
                        end the following: ``that the Secretary 
                        determines complies with standards established 
                        by the Secretary that ensure that the standards 
                        under the State program are comparable to or 
                        more restrictive than those in effect on June 
                        1, 1995''; and
                    (B) in paragraph (6)--
                            (i) in subparagraph (A)(ii)--
                                    (I) by striking ``an AFDC 
                                assistance unit (under the aid to 
                                families with dependent children 
                                program authorized'' and inserting ``a 
                                family (under the State program 
                                funded''; and
                                    (II) by striking ``, in a State'' 
                                and all that follows through 
                                ``9902(2)))'' and inserting ``that the 
                                Secretary determines complies with 
                                standards established by the Secretary 
                                that ensure that the standards under 
                                the State program are comparable to or 
                                more restrictive than those in effect 
                                on June 1, 1995''; and
                            (ii) in subparagraph (B), by striking ``aid 
                        to families with dependent children'' and 
                        inserting ``assistance under the State
                         program funded under part A of title IV of the 
Social Security Act (42 U.S.C. 601 et seq.) that the Secretary 
determines complies with standards established by the Secretary that 
ensure that the standards under the State program are comparable to or 
more restrictive than those in effect on June 1, 1995''; and
            (2) in subsection (d)(2)(C)--
                    (A) by striking ``program for aid to families with 
                dependent children'' and inserting ``State program 
                funded''; and
                    (B) by inserting before the period at the end the 
                following: ``that the Secretary determines complies 
                with standards established by the Secretary that ensure 
                that the standards under the State program are 
                comparable to or more restrictive than those in effect 
                on June 1, 1995''.
    (h) Section 17 of the Child Nutrition Act of 1966 (42 U.S.C. 1786) 
is amended--
            (1) in subsection (d)(2)(A)(ii)(II)--
                    (A) by striking ``program for aid to families with 
                dependent children established'' and inserting ``State 
                program funded''; and
                    (B) by inserting before the semicolon the 
                following: ``that the Secretary determines complies 
                with standards established by the Secretary that ensure 
                that the standards under the State program are 
                comparable to or more restrictive than those in effect 
                on June 1, 1995'';
            (2) in subsection (e)(4)(A), by striking ``program for aid 
        to families with dependent children'' and inserting ``State 
        program funded''; and
            (3) in subsection (f)(1)(C)(iii), by striking ``aid to 
        families with dependent children,'' and inserting ``State 
        program funded under part A of title IV of the Social Security 
        Act (42 U.S.C. 601 et seq.) and with the''.

SEC. 108. CONFORMING AMENDMENTS TO OTHER LAWS.

    (a) Subsection (b) of section 508 of the Unemployment Compensation 
Amendments of 1976 (Public Law 94-566; 90 Stat. 2689) is amended to 
read as follows:
    ``(b) Provision for Reimbursement of Expenses.--For purposes of 
section 455 of the Social Security Act, expenses incurred to reimburse 
State employment offices for furnishing information requested of such 
offices--
            ``(1) pursuant to the third sentence of section 3(a) of the 
        Act entitled `An Act to provide for the establishment of a 
        national employment system and for cooperation with the States 
        in the promotion of such system, and for other purposes', 
        approved June 6, 1933 (29 U.S.C. 49b(a)), or
            ``(2) by a State or local agency charged with the duty of 
        carrying a State plan for child support approved under part D 
        of title IV of the Social Security Act,
shall be considered to constitute expenses incurred in the 
administration of such State plan.''.
    (b) Section 9121 of the Omnibus Budget Reconciliation Act of 1987 
(42 U.S.C. 602 note) is repealed.
    (c) Section 9122 of the Omnibus Budget Reconciliation Act of 1987 
(42 U.S.C. 602 note) is repealed.
    (d) Section 221 of the Housing and Urban-Rural Recovery Act of 1983 
(42 U.S.C. 602 note), relating to treatment under AFDC of certain 
rental payments for federally assisted housing, is repealed.
    (e) Section 159 of the Tax Equity and Fiscal Responsibility Act of 
1982 (42 U.S.C. 602 note) is repealed.
    (f) Section 202(d) of the Social Security Amendments of 1967 (81 
Stat. 882; 42 U.S.C. 602 note) is repealed.
    (g) Section 233 of the Social Security Act Amendments of 1994 (42 
U.S.C. 602 note) is repealed.
    (h) Section 903 of the Stewart B. McKinney Homeless Assistance 
Amendments Act of 1988 (42 U.S.C. 11381 note), relating to 
demonstration projects to reduce number of AFDC families in welfare 
hotels, is amended--
            (1) in subsection (a), by striking ``aid to families with 
        dependent children under a State plan approved'' and inserting 
        ``assistance under a State program funded''; and
            (2) in subsection (c), by striking ``aid to families with 
        dependent children in the State under a State plan approved'' 
        and inserting ``assistance in the State under a State program 
        funded''.
    (i) The Higher Education Act of 1965 (20 U.S.C. 1001 et seq.) is 
amended--
            (1) in section 404C(c)(3) (20 U.S.C. 1070a-23(c)(3)), by 
        striking ``(Aid to Families with Dependent Children)''; and
            (2) in section 480(b)(2) (20 U.S.C. 1087vv(b)(2)), by 
        striking ``aid to families with dependent children under a 
        State plan approved'' and inserting ``assistance under a State 
        program funded''.
    (j) The Carl D. Perkins Vocational and Applied Technology Education 
Act (20 U.S.C. 2301 et seq.) is amended--
            (1) in section 231(d)(3)(A)(ii) (20 U.S.C. 
        2341(d)(3)(A)(ii)), by striking ``the program for aid to 
        dependent children'' and inserting ``the State program 
        funded'';
            (2) in section 232(b)(2)(B) (20 U.S.C. 2341a(b)(2)(B)), by 
        striking ``the program for aid to families with dependent 
        children'' and inserting ``the State program funded''; and
            (3) in section 521(14)(B)(iii) (20 U.S.C. 
        2471(14)(B)(iii)), by striking ``the program for aid to 
        families with dependent children'' and inserting ``the State 
        program funded''.
    (k) The Elementary and Secondary Education Act of 1965 (20 U.S.C. 
2701 et seq.) is amended--
            (1) in section 1113(a)(5) (20 U.S.C. 6313(a)(5)), by 
        striking ``Aid to Families with Dependent Children Program'' 
        and inserting ``State program funded under part A of title IV 
        of the Social Security Act'';
            (2) in section 1124(c)(5) (20 U.S.C. 6333(c)(5)), by 
        striking ``the program of aid to families with dependent 
        children under a State plan approved under'' and inserting ``a 
        State program funded under part A of''; and
            (3) in section 5203(b)(2) (20 U.S.C. 7233(b)(2))--
                    (A) in subparagraph (A)(xi), by striking ``Aid to 
                Families with Dependent Children benefits'' and 
                inserting ``assistance under a State program funded 
                under part A of title IV of the Social Security Act''; 
                and
                    (B) in subparagraph (B)(viii), by striking ``Aid to 
                Families with Dependent Children'' and inserting 
                ``assistance under the State program funded under part 
                A of title IV of the Social Security Act''.
    (l) Chapter VII of title I of Public Law 99-88 (25 U.S.C. 13d-1) is 
amended to read as follows: ``Provided further, That general assistance 
payments made by the Bureau of Indian Affairs shall be made--
            ``(1) after April 29, 1985, and before October 1, 1995, on 
        the basis of Aid to Families with Dependent Children (AFDC) 
        standards of need; and
            ``(2) on and after October 1, 1995, on the basis of 
        standards of need established under the State program funded 
        under part A of title IV of the Social Security Act,
except that where a State ratably reduces its AFDC or State program 
payments, the Bureau shall reduce general assistance payments in such 
State by the same percentage as the State has reduced the AFDC or State 
program payment.''.
    (m) The Internal Revenue Code of 1986 (26 U.S.C. 1 et seq.) is 
amended--
            (1) in section 51(d)(9) (26 U.S.C. 51(d)(9)), by striking 
        all that follows ``agency as'' and inserting ``being eligible 
        for financial assistance under part A of title IV of the Social 
        Security Act and as having continually received such financial 
        assistance during the 90-day period which immediately precedes 
        the date on which such individual is hired by the employer.'';
            (2) in section 3304(a)(16) (26 U.S.C. 3304(a)(16)), by 
        striking ``eligibility for aid or services,'' and all that 
        follows through ``children approved'' and inserting 
        ``eligibility for assistance, or the amount of such assistance, 
        under a State program funded'';
            (3) in section 6103(l)(7)(D)(i) (26 U.S.C. 
        6103(l)(7)(D)(i)), by striking ``aid to families with dependent 
        children provided under a State plan approved'' and inserting 
        ``a State program funded'';
            (4) in section 6334(a)(11)(A) (26 U.S.C. 6334(a)(11)(A)), 
        by striking ``(relating to aid to families with dependent 
        children)''; and
            (5) in section 7523(b)(3)(C) (26 U.S.C. 7523(b)(3)(C)), by 
        striking ``aid to families with dependent children'' and 
        inserting ``assistance under a State program funded under part 
        A of title IV of the Social Security Act''.
    (n) Section 3(b) of the Wagner-Peyser Act (29 U.S.C. 49b(b)) is 
amended by striking ``State plan approved under part A of title IV'' 
and inserting ``State program funded under part A of title IV''.
    (o) The Job Training Partnership Act (29 U.S.C. 1501 et seq.) is 
amended--
            (1) in section 4(29)(A)(i) (29 U.S.C. 1503(29)(A)(i)), by 
        striking ``(42 U.S.C. 601 et seq.)'';
            (2) in section 106(b)(6)(C) (29 U.S.C. 1516(b)(6)(C)), by 
        striking ``State aid to families with dependent children 
        records,'' and inserting ``records collected under the State 
        program funded under part A of title IV of the Social Security 
        Act,'';
            (3) in section 121(b)(2) (29 U.S.C. 1531(b)(2))--
                    (A) by striking ``the JOBS program'' and inserting 
                ``the work activities required under title IV of the 
                Social Security Act''; and
                    (B) by striking the second sentence;
            (4) in section 123(c) (29 U.S.C. 1533(c))--
                    (A) in paragraph (1)(E), by repealing clause (vi); 
                and
                    (B) in paragraph (2)(D), by repealing clause (v);
            (5) in section 203(b)(3) (29 U.S.C. 1603(b)(3)), by 
        striking ``, including recipients under the JOBS program'';
            (6) in subparagraphs (A) and (B) of section 204(a)(1) (29 
        U.S.C. 1604(a)(1) (A) and (B)), by striking ``(such as the JOBS 
        program)'' each place it appears;
            (7) in section 205(a) (29 U.S.C. 1605(a)), by striking 
        paragraph (4) and inserting the following:
            ``(4) the portions of title IV of the Social Security Act 
        relating to work activities;'';
            (8) in section 253 (29 U.S.C. 1632)--
                    (A) in subsection (b)(2), by repealing subparagraph 
                (C); and
                    (B) in paragraphs (1)(B) and (2)(B) of subsection 
                (c), by striking ``the JOBS program or'' each place it 
                appears;
            (9) in section 264 (29 U.S.C. 1644)--
                    (A) in subparagraphs (A) and (B) of subsection 
                (b)(1), by striking ``(such as the JOBS program)'' each 
                place it appears; and
                    (B) in subparagraphs (A) and (B) of subsection 
                (d)(3), by striking ``and the JOBS program'' each place 
                it appears;
            (10) in section 265(b) (29 U.S.C. 1645(b)), by striking 
        paragraph (6) and inserting the following:
            ``(6) the portion of title IV of the Social Security Act 
        relating to work activities;'';
            (11) in the second sentence of section 429(e) (29 U.S.C. 
        1699(e)), by striking ``and shall be in an amount that does not 
        exceed the maximum amount that may be provided by the State 
        pursuant to section 402(g)(1)(C) of the Social Security Act (42 
        U.S.C. 602(g)(1)(C))'';
            (12) in section 454(c) (29 U.S.C. 1734(c)), by striking 
        ``JOBS and'';
            (13) in section 455(b) (29 U.S.C. 1735(b)), by striking 
        ``the JOBS program,'';
            (14) in section 501(1) (29 U.S.C. 1791(1)), by striking 
        ``aid to families with dependent children under part A of title 
        IV of the Social Security Act (42 U.S.C. 601 et seq.)'' and 
        inserting ``assistance under the State program funded under 
        part A of title IV of the Social Security Act'';
            (15) in section 506(1)(A) (29 U.S.C. 1791e(1)(A)), by 
        striking ``aid to families with dependent children'' and 
        inserting ``assistance under the State program funded'';
            (16) in section 508(a)(2)(A) (29 U.S.C. 1791g(a)(2)(A)), by 
        striking ``aid to families with dependent children'' and 
        inserting ``assistance under the State program funded''; and
            (17) in section 701(b)(2)(A) (29 U.S.C. 1792(b)(2)(A))--
                    (A) in clause (v), by striking the semicolon and 
                inserting ``; and''; and
                    (B) by striking clause (vi).
    (p) Section 3803(c)(2)(C)(iv) of title 31, United States Code, is 
amended to read as follows:
                            ``(iv) assistance under a State program 
                        funded under part A of title IV of the Social 
                        Security Act''.
    (q) Section 2605(b)(2)(A)(i) of the Low-Income Home Energy 
Assistance Act of 1981 (42 U.S.C. 8624(b)(2)(A)(i)) is amended to read 
as follows:
                            ``(i) assistance under the State program 
                        funded under part A of title IV of the Social 
                        Security Act;''.
    (r) Section 303(f)(2) of the Family Support Act of 1988 (42 U.S.C. 
602 note) is amended--
            (1) by striking ``(A)''; and
            (2) by striking subparagraphs (B) and (C).
    (s) The Balanced Budget and Emergency Deficit Control Act of 1985 
(2 U.S.C. 900 et seq.)) is amended--
            (1) in section 255(h) (2 U.S.C. 905(h), by striking ``Aid 
        to families with dependent children (75-0412-0-1-609);'' and 
        inserting ``Block grants to States for temporary assistance for 
        needy families;''; and
            (2) in section 256 (2 U.S.C. 906)--
                    (A) by striking subsection (k); and
                    (B) by redesignating subsection (l) as subsection 
                (k).
    (t) The Immigration and Nationality Act (8 U.S.C. 1101 et seq.) is 
amended--
            (1) in section 210(f) (8 U.S.C. 1160(f)), by striking ``aid 
        under a State plan approved under'' each place it appears and 
        inserting ``assistance under a State program funded under'';
            (2) in section 245A(h) (8 U.S.C. 1255a(h))--
                    (A) in paragraph (1)(A)(i), by striking ``program 
                of aid to families with dependent children'' and 
                inserting ``State program of assistance''; and
                    (B) in paragraph (2)(B), by striking ``aid to 
                families with dependent children'' and inserting 
                ``assistance under a State program funded under part A 
                of title IV of the Social Security Act''; and
            (3) in section 412(e)(4) (8 U.S.C. 1522(e)(4)), by striking 
        ``State plan approved'' and inserting ``State program funded''.
    (u) Section 640(a)(4)(B)(i) of the Head Start Act (42 U.S.C. 
9835(a)(4)(B)(i)) is amended by striking ``program of aid to families 
with dependent children under a State plan approved'' and inserting 
``State program of assistance funded''.
    (v) Section 9 of the Act of April 19, 1950 (64 Stat. 47, chapter 
92; 25 U.S.C. 639) is repealed.
    (w) Subparagraph (E) of section 213(d)(6) of the School-To-Work 
Opportunities Act of 1994 (20 U.S.C. 6143(d)(6)) is amended to read as 
follows:
                    ``(E) part A of title IV of the Social Security Act 
                (42 U.S.C. 601 et seq.) relating to work activities;''.

SEC. 109. SECRETARIAL SUBMISSION OF LEGISLATIVE PROPOSAL FOR TECHNICAL 
              AND CONFORMING AMENDMENTS.

    Not later than 90 days after the date of the enactment of this Act, 
the Secretary of Health and Human Services, in consultation, as 
appropriate, with the heads of other Federal agencies, shall submit to 
the appropriate committees of Congress a legislative proposal providing 
for such technical and conforming amendments in the law as are required 
by the provisions of this Act.

SEC. 110. EFFECTIVE DATE; TRANSITION RULE.

    (a) In General.--Except as otherwise provided in this title, this 
title and the amendments made by this title shall take effect on 
October 1, 1995.
    (b) Transition Rule.--
            (1) State option to continue afdc program.--
                    (A) 6-month extension.--A State may continue a 
                State program under parts A and F of title IV of the 
                Social Security Act, as in effect on September 30, 1995 
                (for purposes of this paragraph, the ``State AFDC 
                program'') until March 31, 1996.
                    (B) Reduction of fiscal year 1996 grant.--In the 
                case of any State opting to continue the State AFDC 
                program pursuant to subparagraph (A), the State family 
                assistance grant paid to such State under section 
                403(a) of the Social Security Act (as added by section 
                101 and as in effect on and after October 1, 1995) for 
                fiscal year 1996 (after the termination of the State 
                AFDC program) shall be reduced by an amount equal to 
                the total Federal payment to such State under section 
                403 of the Social Security Act (as in effect on 
                September 30, 1995) for such fiscal year.
            (2) Claims, actions, and proceedings.--The amendments made 
        by this title shall not apply with respect to--
                    (A) powers, duties, functions, rights, claims, 
                penalties, or obligations applicable to aid, 
                assistance, or services provided before the effective 
                date of this title under the provisions amended; and
                    (B) administrative actions and proceedings 
                commenced before such date, or authorized before such 
                date to be commenced, under such provisions.
    (c) Sunset.--The amendment made by section 101(b) shall be 
effective only during the 5-year period beginning on October 1, 1995.
                 TITLE II--SUPPLEMENTAL SECURITY INCOME

                  Subtitle A--Eligibility Restrictions

SEC. 201. DENIAL OF SUPPLEMENTAL SECURITY INCOME BENEFITS BY REASON OF 
              DISABILITY TO DRUG ADDICTS AND ALCOHOLICS.

    (a) In General.--Section 1614(a)(3) (42 U.S.C. 1382c(a)(3)) is 
amended by adding at the end the following:
    ``(I) Notwithstanding subparagraph (A), an individual shall not be 
considered to be disabled for purposes of this title if alcoholism or 
drug addiction would (but for this subparagraph) be a contributing 
factor material to the Commissioner's determination that the individual 
is disabled.''.
    (b) Representative Payee Requirements.--
            (1) Section 1631(a)(2)(A)(ii)(II) (42 U.S.C. 
        1383(a)(2)(A)(ii)(II)) is amended to read as follows:
    ``(II) In the case of an individual eligible for benefits under 
this title by reason of disability, if such individual also has an 
alcoholism or drug addiction condition (as determined by the 
Commissioner of Social Security), the payment of such benefits to a 
representative payee shall be deemed to serve the interest of the 
individual. In any case in which such payment is so deemed under this 
subclause to serve the interest of an individual, the Commissioner 
shall include, in the individual's notification of such eligibility, a 
notice that such alcoholism or drug addiction condition accompanies the 
disability upon which such eligibility is based and that the 
Commissioner is therefore required to pay the individual's benefits to 
a representative payee.''.
            (2) Section 1631(a)(2)(B)(vii) (42 U.S.C. 
        1383(a)(2)(B)(vii)) is amended by striking ``eligible for 
        benefits'' and all that follows through ``is disabled'' and 
        inserting ``described in subparagraph (A)(ii)(II)''.
            (3) Section 1631(a)(2)(B)(ix)(II) (42 U.S.C. 
        1383(a)(2)(B)(ix)(II)) is amended by striking all that follows 
        ``15 years, or'' and inserting ``described in subparagraph 
        (A)(ii)(II)''.
            (4) Section 1631(a)(2)(D)(i)(II) (42 U.S.C. 
        1383(a)(2)(D)(i)(II)) is amended by striking ``eligible for 
        benefits'' and all that follows through ``is disabled'' and 
        inserting ``described in subparagraph (A)(ii)(II)''.
    (c) Conforming Amendments.--
            (1) Section 1611(e) (42 U.S.C. 1382(e)) is amended by 
        striking paragraph (3).
            (2) Section 1634 (42 U.S.C. 1383c) is amended by striking 
        subsection (e).
            (3) Section 201(c)(1) of the Social Security Independence 
        and Program Improvements Act of 1994 (42 U.S.C. 425 note) is 
        amended--
                    (A) by striking ``--'' and all that follows through 
                ``(A)'' the 1st place it appears;
                    (B) by striking ``and'' the 3rd place it appears;
                    (C) by striking subparagraph (B);
                    (D) by striking ``either subparagraph (A) or 
                subparagraph (B)'' and inserting ``the preceding 
                sentence''; and
                    (E) by striking ``subparagraph (A) or (B)'' and 
                inserting ``the preceding sentence''.

SEC. 202. LIMITED ELIGIBILITY OF NONCITIZENS FOR SSI BENEFITS.

    Paragraph (1) of section 1614(a) (42 U.S.C. 1382c(a)) is amended--
            (1) in subparagraph (B)(i), by striking ``either'' and all 
        that follows through ``, or'' and inserting ``(I) a citizen; 
        (II) a noncitizen who is granted asylum under section 208 of 
        the Immigration and Nationality Act or whose deportation has 
        been withheld under section 243(h) of such Act for a period of 
        not more than 5 years after the date of arrival into the United 
        States; (III) a noncitizen who is admitted to the United States 
        as a refugee under section 207 of such Act for not more than 
        such 5-year period; (IV) a noncitizen, lawfully present in any 
        State (or any territory or possession of the United States), 
        who is a veteran (as defined in section 101 of title 38, United 
        States Code) with a discharge characterized as an honorable 
        discharge and not on account of alienage or who is the spouse 
        or unmarried dependent child of such veteran; or (V) a 
        noncitizen who has worked sufficient calendar quarters of 
        coverage to be a fully insured individual for benefits under 
        title II, or''; and
            (2) by adding at the end the following new flush sentence:
``For purposes of subparagraph (B)(i)(IV), the determination of whether 
a noncitizen is lawfully present in the United States shall be made in 
accordance with regulations of the Attorney General. A noncitizen shall 
not be considered to be lawfully present in the United States for 
purposes of this title merely because the noncitizen may be considered 
to be permanently residing in the United States under color of law for 
purposes of any particular program.''.
SEC. 203. DENIAL OF SSI BENEFITS FOR 10 YEARS TO INDIVIDUALS FOUND TO 
              HAVE FRAUDULENTLY MISREPRESENTED RESIDENCE IN ORDER TO 
              OBTAIN BENEFITS SIMULTANEOUSLY IN 2 OR MORE STATES.

    Section 1614(a) (42 U.S.C. 1382c(a)) is amended by adding at the 
end the following new paragraph:
    ``(5) An individual shall not be considered an eligible individual 
for purposes of this title during the 10-year period beginning on the 
date the individual is convicted in Federal or State court of having 
made a fraudulent statement or representation with respect to the place 
of residence of the individual in order to receive assistance 
simultaneously from 2 or more States under programs that are funded 
under part A of title IV, title XIX, or the Food Stamp Act of 1977, or 
benefits in 2 or more States under the supplemental security income 
program under title XVI.''.

SEC. 204. DENIAL OF SSI BENEFITS FOR FUGITIVE FELONS AND PROBATION AND 
              PAROLE VIOLATORS.

    (a) In General.--Section 1611(e) (42 U.S.C. 1382(e)), as amended by 
section 201(c)(1), is amended by inserting after paragraph (2) the 
following new paragraph:
    ``(3) A person shall not be an eligible individual or eligible 
spouse for purposes of this title with respect to any month if during 
such month the person is--
            ``(A) fleeing to avoid prosecution, or custody or 
        confinement after conviction, under the laws of the place from 
        which the person flees, for a crime, or an attempt to commit a 
        crime, which is a felony under the laws of the place from which 
        the person flees, or which, in the case of the State of New 
        Jersey, is a high misdemeanor under the laws of such State; or
            ``(B) violating a condition of probation or parole imposed 
        under Federal or State law.''.
    (b) Exchange of Information With Law Enforcement Agencies.--Section 
1631(e) (42 U.S.C. 1383(e)) is amended by inserting after paragraph (3) 
the following new paragraph:
    ``(4) Notwithstanding any other provision of law, the Commissioner 
shall furnish any Federal, State, or local law enforcement officer, 
upon the request of the officer, with the current address of any 
recipient of benefits under this title, if the officer furnishes the 
agency with the name of the recipient and notifies the agency that--
            ``(A) the recipient--
                    ``(i) is fleeing to avoid prosecution, or custody 
                or confinement after conviction, under the laws of the 
                place from which the person flees, for a crime, or an 
                attempt to commit a crime, which is a felony under the 
                laws of the place from which the person flees, or 
                which, in the case of the State of New Jersey, is a 
                high misdemeanor under the laws of such State;
                    ``(ii) is violating a condition of probation or 
                parole imposed under Federal or State law; or
                    ``(iii) has information that is necessary for the 
                officer to conduct the officer's official duties; and
            ``(B) the location or apprehension of the recipient is 
        within the officer's official duties.''.

SEC. 205. EFFECTIVE DATES; APPLICATION TO CURRENT RECIPIENTS.

    (a) Sections 201 and 202.--
            (1) In general.--Except as provided in paragraphs (2) and 
        (3), the amendments made by sections 201 and 202 shall apply to 
        applicants for benefits for months beginning on or after the 
        date of the enactment of this Act, without regard to whether 
        regulations have been issued to implement such amendments.
            (2) Application to current recipients.--
                    (A) Application and notice.--Notwithstanding any 
                other provision of law, in the case of an individual 
                who is receiving supplemental security income benefits 
                under title XVI of the Social Security Act as of the 
                date of the enactment of this Act and whose eligibility 
                for such benefits would terminate by reason of the 
                amendments made by section 201 or 202, such amendments 
                shall apply with respect to the benefits of such 
                individual for months beginning on or after January 1, 
                1997, and the Commissioner of Social Security shall so 
                notify the individual not later than 90 days after the 
                date of the enactment of this Act.
                    (B) Reapplication.--
                            (i) In general.--Not later than 120 days 
                        after the date of the enactment of this Act, 
                        each individual notified pursuant to 
                        subparagraph (A) who desires to reapply for 
                        benefits under title XVI of the Social Security 
                        Act, as amended by this title, shall reapply to 
                        the Commissioner of Social Security.
                            (ii) Determination of eligibility.--Not 
                        later than 1 year after the date of the 
                        enactment of this Act, the Commissioner of 
                        Social Security shall determine the eligibility 
                        of each individual who reapplies for benefits 
                        under clause (i) pursuant to the procedures of 
                        such title.
            (3) Additional application of payee representative 
        requirements.--The amendments made by section 201(b) shall also 
        apply--
                    (A) in the case of any individual who is receiving 
                supplemental security income benefits under title XVI 
                of the Social Security Act as of the date of the 
                enactment of this Act, on and after the date of such 
                individual's first continuing disability review 
                occurring after such date of enactment, and
                    (B) in the case of any individual who receives 
                supplemental security income benefits under title XVI 
                of the Social Security Act and has attained age 65, in 
                such manner as determined appropriate by the 
                Commissioner of Social Security.
    (b) Other Amendments.--The amendments made by sections 203 and 204 
shall take effect on the date of the enactment of this Act.
               Subtitle B--Benefits for Disabled Children

SEC. 211. DEFINITION AND ELIGIBILITY RULES.

    (a) Definition of Childhood Disability.--Section 1614(a)(3) (42 
U.S.C. 1382c(a)(3)), as amended by section 201(a), is amended--
            (1) in subparagraph (A), by striking ``An individual'' and 
        inserting ``Except as provided in subparagraph (C), an 
        individual'';
            (2) in subparagraph (A), by striking ``(or, in the case of 
        an individual under the age of 18, if he suffers from any 
        medically determinable physical or mental impairment of 
        comparable severity)'';
            (3) by redesignating subparagraphs (C) through (I) as 
        subparagraphs (D) through (J), respectively;
            (4) by inserting after subparagraph (B) the following new 
        subparagraph:
    ``(C) An individual under the age of 18 shall be considered 
disabled for the purposes of this title if that individual has a 
medically determinable physical or mental impairment, which results in 
marked and severe functional limitations, and which can be expected to 
result in death or which has lasted or can be expected to last for a 
continuous period of not less than 12 months.''; and
            (5) in subparagraph (F), as redesignated by paragraph (3), 
        by striking ``(D)'' and inserting ``(E)''.
    (b) Changes to Childhood SSI Regulations.--
            (1) Modification to medical criteria for evaluation of 
        mental and emotional disorders.--The Commissioner of Social 
        Security shall modify sections 112.00C.2. and 112.02B.2.c.(2) 
        of appendix 1 to subpart P of part 404 of title 20, Code of 
        Federal Regulations, to eliminate references to maladaptive 
        behavior in the domain of personal/behavorial function.
            (2) Discontinuance of individualized functional 
        assessment.--The Commissioner of Social Security shall 
        discontinue the individualized functional assessment for 
        children set forth in sections 416.924d and 416.924e of title 
        20, Code of Federal Regulations.
    (c) Effective Date; Regulations; Application to Current 
Recipients.--
            (1) In general.--The amendments made by subsections (a) and 
        (b) shall apply to applicants for benefits for months beginning 
        on or after the date of the enactment of this Act, without 
        regard to whether regulations have been issued to implement 
        such amendments.
            (2) Regulations.--The Commissioner of Social Security shall 
        issue such regulations as the Commissioner determines to be 
        necessary to implement the amendments made by subsections (a) 
        and (b) not later than 60 days after the date of the enactment 
        of this Act.
            (3) Application to current recipients.--
                    (A) Eligibility determinations.--Not later than 1 
                year after the date of the enactment of this Act, the 
                Commissioner of Social Security shall redetermine the 
                eligibility of any individual under age 18 who is 
                receiving supplemental security income benefits based 
                on a disability under title XVI of the Social Security 
                Act as of the date of the enactment of this Act and 
                whose eligibility for such benefits may terminate by 
                reason of the amendments made by subsection (a) or (b). 
                With respect to any redetermination under this 
                subparagraph--
                            (i) section 1614(a)(4) of the Social 
                        Security Act (42 U.S.C. 1382c(a)(4)) shall not 
                        apply;
                            (ii) the Commissioner of Social Security 
                        shall apply the eligibility criteria for new 
                        applicants for benefits under title XVI of such 
                        Act;
                            (iii) the Commissioner shall give such 
                        redetermination priority over all continuing 
                        eligibility reviews and other reviews under 
                        such title; and
                            (iv) such redetermination shall be counted 
                        as a review or redetermination otherwise 
                        required to be made under section 208 of the 
                        Social Security Independence and Program 
                        Improvements Act of 1994 or any other provision 
                        of title XVI of the Social Security Act.
                    (B) Grandfather provision.--The amendments made by 
                subsections (a) and (b), and the redetermination under 
                subparagraph (A), shall only apply with respect to the 
                benefits of an individual described in subparagraph (A) 
                for months beginning on or after January 1, 1997.
                    (C) Notice.--Not later than 90 days after the date 
                of the enactment of this Act, the Commissioner of 
                Social Security shall notify an individual described in 
                subparagraph (A) of the provisions of this paragraph.

SEC. 212. ELIGIBILITY REDETERMINATIONS AND CONTINUING DISABILITY 
              REVIEWS.

    (a) Continuing Disability Reviews Relating to Certain Children.--
Section 1614(a)(3)(H) (42 U.S.C. 1382c(a)(3)(H)), as redesignated by 
section 211(a)(3), is amended--
            (1) by inserting ``(i)'' after ``(H)''; and
            (2) by adding at the end the following new clause:
    ``(ii)(I) Not less frequently than once every 3 years, the 
Commissioner shall review in accordance with paragraph (4) the 
continued eligibility for benefits under this title of each individual 
who has not attained 18 years of age and is eligible for such benefits 
by reason of an impairment (or combination of impairments) which may 
improve (or, which is unlikely to improve, at the option of the 
Commissioner).
    ``(II) A parent or guardian of a recipient whose case is reviewed 
under this clause shall present, at the time of review, evidence 
demonstrating that the recipient is, and has been, receiving treatment, 
to the extent considered medically necessary and available, of the 
condition which was the basis for providing benefits under this 
title.''.
    (b) Disability Eligibility Redeterminations Required for SSI 
Recipients Who Attain 18 Years of Age.--
            (1) In general.--Section 1614(a)(3)(H) (42 U.S.C. 
        1382c(a)(3)(H)), as amended by subsection (a), is amended by 
        adding at the end the following new clause:
    ``(iii) If an individual is eligible for benefits under this title 
by reason of disability for the month preceding the month in which the 
individual attains the age of 18 years, the Commissioner shall 
redetermine such eligibility--
            ``(I) during the 1-year period beginning on the 
        individual's 18th birthday; and
            ``(II) by applying the criteria used in determining the 
        initial eligibility for applicants who have attained the age of 
        18 years.
With respect to a redetermination under this clause, paragraph (4) 
shall not apply and such redetermination shall be considered a 
substitute for a review or redetermination otherwise required under any 
other provision of this subparagraph during that 1-year period.''.
            (2) Conforming repeal.--Section 207 of the Social Security 
        Independence and Program Improvements Act of 1994 (42 U.S.C. 
        1382 note; 108 Stat. 1516) is hereby repealed.
    (c) Continuing Disability Review Required for Low Birth Weight 
Babies.--Section 1614(a)(3)(H) (42 U.S.C. 1382c(a)(3)(H)), as amended 
by subsections (a) and (b), is amended by adding at the end the 
following new clause:
    ``(iv)(I) Not later than 12 months after the birth of an 
individual, the Commissioner shall review in accordance with paragraph 
(4) the continuing eligibility for benefits under this title by reason 
of disability of such individual whose low birth weight is a 
contributing factor material to the Commissioner's determination that 
the individual is disabled.
    ``(II) A review under subclause (I) shall be considered a 
substitute for a review otherwise required under any other provision of 
this subparagraph during that 12-month period.
    ``(III) A parent or guardian of a recipient whose case is reviewed 
under this clause shall present, at the time of review, evidence 
demonstrating that the recipient is, and has been, receiving treatment, 
to the extent considered medically necessary and available, of the 
condition which was the basis for providing benefits under this 
title.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to benefits for months beginning on or after the date of the 
enactment of this Act, without regard to whether regulations have been 
issued to implement such amendments.

SEC. 213. ADDITIONAL ACCOUNTABILITY REQUIREMENTS.

    (a) Tightening of Representative Payee Requirements.--
            (1) Clarification of role.--Section 1631(a)(2)(B)(ii) (42 
        U.S.C. 1383(a)(2)(B)(ii)) is amended by striking ``and'' at the 
        end of subclause (II), by striking the period at the end of 
        subclause (IV) and inserting ``; and'', and by adding after 
        subclause (IV) the following new subclause:
            ``(V) advise such person through the notice of award of 
        benefits, and at such other times as the Commissioner of Social 
        Security deems appropriate, of specific examples of appropriate 
        expenditures of benefits under this title and the proper role 
        of a representative payee.''.
            (2) Documentation of expenditures required.--
                    (A) In general.--Subparagraph (C)(i) of section 
                1631(a)(2) (42 U.S.C. 1383(a)(2)) is amended to read as 
                follows:
    ``(C)(i) In any case where payment is made to a representative 
payee of an individual or spouse, the Commissioner of Social Security 
shall--
            ``(I) require such representative payee to document 
        expenditures and keep contemporaneous records of transactions 
        made using such payment; and
            ``(II) implement statistically valid procedures for 
        reviewing a sample of such contemporaneous records in order to 
        identify instances in which such representative payee is not 
        properly using such payment.''.
                    (B) Conforming amendment with respect to parent 
                payees.--Clause (ii) of section 1631(a)(2)(C) (42 
                U.S.C. 1383(a)(2)(C)) is amended by striking ``Clause 
                (i)'' and inserting ``Subclauses (II) and (III) of 
                clause (i)''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to benefits paid after the date of the enactment of 
        this Act.
    (b) Dedicated Savings Accounts.--
            (1) In general.--Section 1631(a)(2)(B) (42 U.S.C. 
        1383(a)(2)(B)) is amended by adding at the end the following 
        new clause:
    ``(xiv) Notwithstanding clause (x), the Commissioner of Social 
Security may, at the request of the representative payee, pay any lump 
sum payment for the benefit of a child into a dedicated savings account 
that could only be used to purchase for such child--
            ``(I) education and job skills training;
            ``(II) special equipment or housing modifications or both 
        specifically related to, and required by the nature of, the 
        child's disability; and
            ``(III) appropriate therapy and rehabilitation.''.
            (2) Disregard of trust funds.--Section 1613(a) (42 U.S.C. 
        1382b) is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (9),
                    (B) by striking the period at the end of paragraph 
                (10) the first place it appears and inserting a 
                semicolon,
                    (C) by redesignating paragraph (10) the second 
                place it appears as paragraph (11) and striking the 
                period at the end of such paragraph and inserting ``; 
                and'', and
                    (D) by inserting after paragraph (11), as so 
                redesignated, the following new paragraph:
            ``(12) all amounts deposited in, or interest credited to, a 
        dedicated savings account described in section 
        1631(a)(2)(B)(xiv).''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to payments made after the date of the enactment of 
        this Act.

   Subtitle C--Studies Regarding Supplemental Security Income Program

SEC. 221. ANNUAL REPORT ON THE SUPPLEMENTAL SECURITY INCOME PROGRAM.

    Title XVI is amended by adding at the end the following new 
section:

``SEC. 1636. ANNUAL REPORT ON PROGRAM.

    ``(a) Description of Report.--Not later than May 30 of each year, 
the Commissioner of Social Security shall prepare and deliver a report 
annually to the President and the Congress regarding the program under 
this title, including--
            ``(1) a comprehensive description of the program;
            ``(2) historical and current data on allowances and 
        denials, including number of applications and allowance rates 
        at initial determinations, reconsiderations, administrative law 
        judge hearings, council of appeals hearings, and Federal court 
        appeal hearings;
            ``(3) historical and current data on characteristics of 
        recipients and program costs, by recipient group (aged, blind, 
        work disabled adults, and children);
            ``(4) projections of future number of recipients and 
        program costs, through at least 25 years;
            ``(5) number of redeterminations and continuing disability 
        reviews, and the outcomes of such redeterminations and reviews;
            ``(6) data on the utilization of work incentives;
            ``(7) detailed information on administrative and other 
        program operation costs;
            ``(8) summaries of relevant research undertaken by the 
        Social Security Administration, or by other researchers;
            ``(9) State supplementation program operations;
            ``(10) a historical summary of statutory changes to this 
        title; and
            ``(11) such other information as the Commissioner deems 
        useful.
    ``(b) Views of Members of the Social Security Advisory Council.--
Each member of the Social Security Advisory Council shall be permitted 
to provide an individual report, or a joint report if agreed, of views 
of the program under this title, to be included in the annual report 
under this section.''.

SEC. 222. IMPROVEMENTS TO DISABILITY EVALUATION.

    (a) Request for Comments.--
            (1) In general.--Not later than 60 days after the date of 
        the enactment of this Act, the Commissioner of Social Security 
        shall issue a request for comments in the Federal Register 
        regarding improvements to the disability evaluation and 
        determination procedures for individuals under age 18 to ensure 
        the comprehensive assessment of such individuals, including--
                    (A) additions to conditions which should be 
                presumptively disabling at birth or ages 0 through 3 
                years;
                    (B) specific changes in individual listings in the 
                Listing of Impairments set forth in appendix 1 of 
                subpart P of part 404 of title 20, Code of Federal 
                Regulations;
                    (C) improvements in regulations regarding 
                determinations based on regulations providing for 
                medical and functional equivalence to such Listing of 
                Impairments, and consideration of multiple impairments; 
                and
                    (D) any other changes to the disability 
                determination procedures.
            (2) Review and regulatory action.--The Commissioner of 
        Social Security shall promptly review such comments and issue 
        any regulations implementing any necessary changes not later 
        than 18 months after the date of the enactment of this Act.

SEC. 223. STUDY OF DISABILITY DETERMINATION PROCESS.

    (a) In General.--Not later than 90 days after the date of the 
enactment of this Act, and from funds otherwise appropriated, the 
Commissioner of Social Security shall make arrangements with the 
National Academy of Sciences, or other independent entity, to conduct a 
study of the disability determination process under titles II and XVI 
of the Social Security Act. This study shall be undertaken in 
consultation with professionals representing appropriate disciplines.
    (b) Study Components.--The study described in subsection (a) shall 
include--
            (1) an initial phase examining the appropriateness of, and 
        making recommendations regarding--
                    (A) the definitions of disability in effect on the 
                date of the enactment of this Act and the
                 advantages and disadvantages of alternative 
definitions; and
                    (B) the operation of the disability determination 
                process, including the appropriate method of performing 
                comprehensive assessments of individuals under age 18 
                with physical and mental impairments;
            (2) a second phase, which may be concurrent with the 
        initial phase, examining the validity, reliability, and 
        consistency with current scientific knowledge of the standards 
        and individual listings in the Listing of Impairments set forth 
        in appendix 1 of subpart P of part 404 of title 20, Code of 
        Federal Regulations, and of related evaluation procedures as 
        promulgated by the Commissioner of Social Security; and
            (3) such other issues as the applicable entity considers 
        appropriate.
    (c) Reports and Regulations.--
            (1) Reports.--The Commissioner of Social Security shall 
        request the applicable entity, to submit an interim report and 
        a final report of the findings and recommendations resulting 
        from the study described in this section to the President and 
        the Congress not later than 18 months and 24 months, 
        respectively, from the date of the contract for such study, and 
        such additional reports as the Commissioner deems appropriate 
        after consultation with the applicable entity.
            (2) Regulations.--The Commissioner of Social Security shall 
        review both the interim and final reports, and shall issue 
        regulations implementing any necessary changes following each 
        report.

SEC. 224. STUDY BY GENERAL ACCOUNTING OFFICE.

    Not later than January 1, 1998, the Comptroller General of the 
United States shall study and report on the impact of the amendments 
made by, and the provisions of, this title on the supplemental security 
income program under title XVI of the Social Security Act.

      Subtitle D--National Commission on the Future of Disability

SEC. 231. ESTABLISHMENT.

    There is established a commission to be known as the National 
Commission on the Future of Disability (referred to in this subtitle as 
the ``Commission''), the expenses of which shall be paid from funds 
otherwise appropriated for the Social Security Administration.

SEC. 232. DUTIES OF THE COMMISSION.

    (a) In General.--The Commission shall develop and carry out a 
comprehensive study of all matters related to the nature, purpose, and 
adequacy of all Federal programs serving individuals with disabilities. 
In particular, the Commission shall study the disability insurance 
program under title II of the Social Security Act and the supplemental 
security income program under title XVI of such Act.
    (b) Matters Studied.--The Commission shall prepare an inventory of 
Federal programs serving individuals with disabilities, and shall 
examine--
            (1) trends and projections regarding the size and 
        characteristics of the population of individuals with 
        disabilities, and the implications of such analyses for program 
        planning;
            (2) the feasibility and design of performance standards for 
        the Nation's disability programs;
            (3) the adequacy of Federal efforts in rehabilitation 
        research and training, and opportunities to improve the lives 
        of individuals with disabilities through all manners of 
        scientific and engineering research; and
            (4) the adequacy of policy research available to the 
        Federal Government, and what actions might be undertaken to 
        improve the quality and scope of such research.
    (c) Recommendations.--The Commission shall submit to the 
appropriate committees of the Congress and to the President 
recommendations and, as appropriate, proposals for legislation, 
regarding--
            (1) which (if any) Federal disability programs should be 
        eliminated or augmented;
            (2) what new Federal disability programs (if any) should be 
        established;
            (3) the suitability of the organization and location of 
        disability programs within the Federal Government;
            (4) other actions the Federal Government should take to 
        prevent disabilities and disadvantages associated with 
        disabilities; and
            (5) such other matters as the Commission considers 
        appropriate.

SEC. 233. MEMBERSHIP.

    (a) Number and Appointment.--
            (1) In general.--The Commission shall be composed of 15 
        members, of whom--
                    (A) five shall be appointed by the President, of 
                whom not more than 3 shall be of the same major 
                political party;
                    (B) three shall be appointed by the Majority Leader 
                of the Senate;
                    (C) two shall be appointed by the Minority Leader 
                of the Senate;
                    (D) three shall be appointed by the Speaker of the 
                House of Representatives; and
                    (E) two shall be appointed by the Minority Leader 
                of the House of Representatives.
            (2) Representation.--The Commission members shall be chosen 
        based on their education, training, or experience. In 
        appointing individuals as members of the Commission, the 
        President and the Majority and Minority Leaders of the Senate 
        and the Speaker and Minority Leader of the House of 
        Representatives shall seek to ensure that the membership of the 
        Commission reflects the diversity of individuals with 
        disabilities in the United States.
    (b) Comptroller General.--The Comptroller General shall serve on 
the Commission as an ex officio member of the Commission to advise and 
oversee the methodology and approach of the study of the Commission.
    (c) Prohibition Against Officer or Employee.--No officer or 
employee of any government shall be appointed under subsection (a).
    (d) Deadline for Appointment; Term of Appointment.--Members of the 
Commission shall be appointed not later than 60 days after the date of 
the enactment of this Act. The members shall serve on the Commission 
for the life of the Commission.
    (e) Meetings.--The Commission shall locate its headquarters in the 
District of Columbia, and shall meet at the call of the Chairperson, 
but not less than 4 times each year during the life of the Commission.
    (f) Quorum.--Ten members of the Commission shall constitute a 
quorum, but a lesser number may hold hearings.
    (g) Chairperson and Vice Chairperson.--Not later than 15 days after 
the members of the Commission are appointed, such members shall 
designate a Chairperson and Vice Chairperson from among the members of 
the Commission.
    (h) Continuation of Membership.--If a member of the Commission 
becomes an officer or employee of any government after appointment to 
the Commission, the individual may continue as a member until a 
successor member is appointed.
    (i) Vacancies.--A vacancy on the Commission shall be filled in the 
manner in which the original appointment was made not later than 30 
days after the Commission is given notice of the vacancy.
    (j) Compensation.--Members of the Commission shall receive no 
additional pay, allowances, or benefits by reason of their service on 
the Commission.
    (k) Travel Expenses.--Each member of the Commission shall receive 
travel expenses, including per diem in lieu of subsistence, in 
accordance with sections 5702 and 5703 of title 5, United States Code.

SEC. 234. STAFF AND SUPPORT SERVICES.

    (a) Director.--
            (1) Appointment.--Upon consultation with the members of the 
        Commission, the Chairperson shall appoint a Director of the 
        Commission.
            (2) Compensation.--The Director shall be paid the rate of 
        basic pay for level V of the Executive Schedule.
    (b) Staff.--With the approval of the Commission, the Director may 
appoint such personnel as the Director considers appropriate.
    (c) Applicability of Civil Service Laws.--The staff of the 
Commission shall be appointed without regard to the provisions of title 
5, United States Code, governing appointments in the competitive 
service, and shall be paid without regard to the provisions of chapter 
51 and subchapter III of chapter 53 of such title relating to 
classification and General Schedule pay rates.
    (d) Experts and Consultants.--With the approval of the Commission, 
the Director may procure temporary and intermittent services under 
section 3109(b) of title 5, United States Code.
    (e) Staff of Federal Agencies.--Upon the request of the Commission, 
the head of any Federal agency may detail, on a reimbursable basis, any 
of the personnel of such agency to the Commission to assist in carrying 
out the duties of the Commission under this subtitle.
    (f) Other Resources.--The Commission shall have reasonable access 
to materials, resources, statistical data, and other information from 
the Library of Congress and agencies and elected representatives of the 
executive and legislative branches of the Federal Government. The 
Chairperson of the Commission shall make requests for such access in 
writing when necessary.
    (g) Physical Facilities.--The Administrator of the General Services 
Administration shall locate suitable office space for the operation of 
the Commission. The facilities shall serve as the headquarters of the 
Commission and shall include all necessary equipment and incidentals 
required for proper functioning of the Commission.

SEC. 235. POWERS OF COMMISSION.

    (a) Hearings.--The Commission may conduct public hearings or forums 
at the discretion of the Commission, at any time and place the 
Commission is able to secure facilities and witnesses, for the purpose 
of carrying out the duties of the Commission under this subtitle.
    (b) Delegation of Authority.--Any member or agent of the Commission 
may, if authorized by the Commission, take any action the Commission is 
authorized to take by this section.
    (c) Information.--The Commission may secure directly from any 
Federal agency information necessary to enable the Commission to carry 
out its duties under this subtitle. Upon request of the Chairperson or 
Vice Chairperson of the Commission, the head of a Federal agency shall 
furnish the information to the Commission to the extent permitted by 
law.
    (d) Gifts, Bequests, and Devises.--The Commission may accept, use, 
and dispose of gifts, bequests, or devises of services or property, 
both real and personal, for the purpose of aiding or facilitating the 
work of the Commission. Gifts, bequests, or devises of money and 
proceeds from sales of other property received as gifts, bequests, or 
devises shall be deposited in the Treasury and shall be available for 
disbursement upon order of the Commission.
    (e) Mails.--The Commission may use the United States mails in the 
same manner and under the same conditions as other Federal agencies.
SEC. 236. REPORTS.

    (a) Interim Report.--Not later than 1 year prior to the date on 
which the Commission terminates pursuant to section 237, the Commission 
shall submit an interim report to the President and to the Congress. 
The interim report shall contain a detailed statement of the findings 
and conclusions of the Commission, together with the Commission's 
recommendations for legislative and administrative action, based on the 
activities of the Commission.
    (b) Final Report.--Not later than the date on which the Commission 
terminates, the Commission shall submit to the Congress and to the 
President a final report containing--
            (1) a detailed statement of final findings, conclusions, 
        and recommendations; and
            (2) an assessment of the extent to which recommendations of 
        the Commission included in the interim report under subsection 
        (a) have been implemented.
    (c) Printing and Public Distribution.--Upon receipt of each report 
of the Commission under this section, the President shall--
            (1) order the report to be printed; and
            (2) make the report available to the public upon request.

SEC. 237. TERMINATION.

    The Commission shall terminate on the date that is 2 years after 
the date on which the members of the Commission have met and designated 
a Chairperson and Vice Chairperson.

               Subtitle E--State Supplementation Programs

SEC. 241. REPEAL OF MAINTENANCE OF EFFORT REQUIREMENTS APPLICABLE TO 
              OPTIONAL STATE PROGRAMS FOR SUPPLEMENTATION OF SSI 
              BENEFITS.

    (a) In General.--Section 1618 (42 U.S.C. 1382g) is repealed.
    (b) Effective Date.--The repeal made by subsection (a) shall apply 
with respect to calendar quarters beginning after September 30, 1995.
                     TITLE III--FOOD STAMP PROGRAM

                     Subtitle A--Food Stamp Reform

SEC. 301. CERTIFICATION PERIOD.

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

SEC. 302. TREATMENT OF CHILDREN LIVING AT HOME.

    The second sentence of section 3(i) of the Food Stamp Act of 1977 
(7 U.S.C. 2012(i)) is amended by striking ``(who are not themselves 
parents living with their children or married and living with their 
spouses)''.

SEC. 303. OPTIONAL ADDITIONAL CRITERIA FOR SEPARATE HOUSEHOLD 
              DETERMINATIONS.

    (a) In General.--Section 3(i) of the Food Stamp Act of 1977 (7 
U.S.C. 2012(i)) is amended by inserting after the third sentence the 
following: ``Notwithstanding the preceding sentences, a State may 
establish criteria that prescribe when individuals who live together, 
and who would be allowed to participate as separate households under 
the preceding sentences, shall be considered a single household, 
without regard to the common purchase of food and preparation of 
meals.''.
    (b) Conforming Amendment.--The second sentence of section 5(a) of 
the Act (7 U.S.C. 2014(a)) is amended by striking ``the third sentence 
of section 3(i)'' and inserting ``the fourth sentence of section 
3(i)''.

SEC. 304. ADJUSTMENT OF THRIFTY FOOD PLAN.

    The second sentence of section 3(o) of the Food Stamp Act of 1977 
(7 U.S.C. 2012(o)) is amended--
            (1) by striking ``shall (1) make'' and inserting the 
        following: ``shall--
            ``(1) make'';
            (2) by striking ``scale, (2) make'' and inserting ``scale;
            ``(2) make'';
            (3) by striking ``Alaska, (3) make'' and inserting the 
        following: ``Alaska;
            ``(3) make''; and
            (4) by striking ``Columbia, (4) through'' and all that 
        follows through the end of the subsection and inserting the 
        following: ``Columbia; and
            ``(4) on October 1, 1995, and each October 1 thereafter, 
        adjust the cost of the diet to reflect the cost of the diet, in 
        the preceding June, and round the result to the nearest lower 
        dollar increment for each household size, except that on 
        October 1, 1995, the Secretary may not reduce the cost of the 
        diet in effect on September 30, 1995.''.

SEC. 305. DEFINITION OF HOMELESS INDIVIDUAL.

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

SEC. 306. STATE OPTIONS IN REGULATIONS.

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

SEC. 307. EARNINGS OF STUDENTS.

    Section 5(d)(7) of the Food Stamp Act of 1977 (7 U.S.C. 2014(d)(7)) 
is amended by striking ``21'' and inserting ``19''.

SEC. 308. ENERGY ASSISTANCE.

    (a) In General.--Section 5(d) of the Food Stamp Act of 1977 (7 
U.S.C. 2014(d)) is amended--
            (1) by striking paragraph (11); and
            (2) by redesignating paragraphs (12) through (15) as 
        paragraphs (11) through (14), respectively.
    (b) Conforming Amendments.--
            (1) Section 5(k) of the Act (7 U.S.C. 2014(k)) is amended--
                    (A) in paragraph (1)--
                            (i) in subparagraph (A), by striking ``plan 
                        for aid to families with dependent children 
                        approved'' and inserting ``program funded''; 
                        and
                            (ii) in subparagraph (B), by striking ``, 
                        not including energy or utility-cost 
                        assistance,''; and
                    (B) in paragraph (2)--
                            (i) by striking subparagraph (C); and
                            (ii) by redesignating subparagraphs (D) 
                        through (H) as subparagraphs (C) through (G), 
                        respectively;
                    (C) by adding at the end the following:
            ``(4) Third party energy assistance payments.--
                    ``(A) Energy assistance payments.--For purposes of 
                subsection (d)(1), a payment made under a Federal or 
                State law to provide energy assistance to a household 
                shall be considered money payable directly to the 
                household.
                    ``(B) Energy assistance expenses.--For purposes of 
                subsection (e)(7), an expense paid on behalf of a 
                household under a Federal or State law to provide 
                energy assistance shall be considered an out-of-pocket 
                expense incurred and paid by the household.''.
            (2) Section 2605(f) of the Low-Income Home Energy 
        Assistance Act of 1981 (42 U.S.C. 8624(f)) is amended--
                    (A) by striking ``(f)(1) Notwithstanding'' and 
                inserting ``(f) Notwithstanding'';
                    (B) in paragraph (1), by striking ``food stamps,''; 
                and
                    (C) by striking paragraph (2).

SEC. 309. DEDUCTIONS FROM INCOME.

    (a) In General.--Section 5 of the Food Stamp Act of 1977 (7 U.S.C. 
2014) is amended by striking subsection (e) and inserting the 
following:
    ``(e) Deductions From Income.--
            ``(1) Standard deduction.--
                    ``(A) In general.--The Secretary shall allow a 
                standard deduction for each household in the 48 
                contiguous States and the District of Columbia, Alaska, 
                Hawaii, Guam, and the Virgin Islands of the United 
                States of--
                            ``(i) for fiscal year 1995, $134, $229, 
                        $189, $269, and $118, respectively;
                            ``(ii) for fiscal year 1996, $132, $225, 
                        $186, $265, and $116, respectively;
                            ``(iii) for fiscal year 1997, $130, $222, 
                        $183, $261, and $114, respectively;
                            ``(iv) for fiscal year 1998, $128, $218, 
                        $180, $257, and $112, respectively;
                            ``(v) for fiscal year 1999, $126, $215, 
                        $177, $252, and $111, respectively; and
                            ``(vi) for fiscal year 2000, $124, $211, 
                        $174, $248, and $109, respectively.
                    ``(B) Adjustment for inflation.--On October 1, 
                2000, and each October 1 thereafter, the Secretary 
                shall adjust the standard deduction to the nearest 
                lower dollar increment to reflect changes in the 
                Consumer Price Index for all urban consumers published 
                by the Bureau of Labor Statistics, for items other than 
                food, for the 12-month period ending the preceding June 
                30.
            ``(2) Earned income deduction.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), a household with earned income shall 
                be allowed a deduction of 20 percent of all earned 
                income (other than income excluded by subsection (d)), 
                to compensate for taxes, other mandatory deductions 
                from salary, and work expenses.
                    ``(B) Exception.--The deduction described in 
                subparagraph (A) shall not be allowed with respect to 
                determining an overissuance due to the failure of a 
                household to report earned income in a timely manner.
            ``(3) Dependent care deduction.--
                    ``(A) In general.--A household shall be entitled, 
                with respect to expenses (other than excluded expenses 
                described in subparagraph (B)) for dependent care, to a 
                dependent care deduction, the maximum allowable level 
                of which shall be $200 per month for each dependent 
                child under 2 years of age and $175 per month for each 
                other dependent, for the actual cost of payments 
                necessary for the care of a dependent if the care 
                enables a household member to accept or continue 
                employment, or training or education that is 
                preparatory for employment.
                    ``(B) Excluded expenses.--The excluded expenses 
                referred to in subparagraph (A) are--
                            ``(i) expenses paid on behalf of the 
                        household by a third party;
                            ``(ii) amounts made available and excluded 
                        for the expenses referred to in subparagraph 
                        (A) under subsection (d)(3); and
                            ``(iii) expenses that are paid under 
                        section 6(d)(4).
            ``(4) Deduction for child support payments.--
                    ``(A) In general.--A household shall be entitled to 
                a deduction for child support payments made by a 
                household member to or for an individual who is not a 
                member of the household if the household member is 
                legally obligated to make the payments.
                    ``(B) Methods for determining amount.--The 
                Secretary may prescribe by regulation the methods, 
                including calculation on a retrospective basis, that a 
                State agency shall use to determine the amount of the 
                deduction for child support payments.
            ``(5) Homeless shelter deduction.--A State agency may 
        develop a standard homeless shelter deduction, which shall not 
        exceed $139 per month, for such expenses as may reasonably be 
        expected to be incurred by households in which all members are 
        homeless individuals but are not receiving free shelter 
        throughout the month. A State agency that develops the 
        deduction may use the deduction in determining eligibility and 
        allotments for the households, except that the State agency may 
        prohibit the use of the deduction for households with extremely 
        low shelter costs.
            ``(6) Excess medical expense deduction.--
                    ``(A) In general.--A household containing an 
                elderly or disabled member shall be entitled, with 
                respect to expenses other than expenses paid on behalf 
                of the household by a third party, to an excess medical 
                expense deduction for the portion of the actual costs 
                of allowable medical expenses, incurred by the elderly 
                or disabled member, exclusive of special diets, that 
                exceeds $35 per month.
                    ``(B) Method of claiming deduction.--
                            ``(i) In general.--A State agency shall 
                        offer an eligible household under subparagraph 
                        (A) a method of claiming a deduction for 
                        recurring medical expenses that are initially 
                        verified under the excess medical expense 
                        deduction in lieu of submitting information or 
                        verification on actual expenses on a monthly 
                        basis.
                            ``(ii) Method.--The method described in 
                        clause (i) shall--
                                    ``(I) be designed to minimize the 
                                burden for the eligible elderly or 
                                disabled household member choosing to 
                                deduct the recurrent medical expenses 
                                of the member pursuant to the method;
                                    ``(II) rely on reasonable estimates 
                                of the expected medical expenses of the 
                                member for the certification period 
                                (including changes that can be 
                                reasonably anticipated based on 
                                available information about the medical 
                                condition of the member, public or 
                                private medical insurance coverage, and 
                                the current verified medical expenses 
                                incurred by the member); and
                                    ``(III) not require further 
                                reporting or verification of a change 
                                in medical expenses if such a change 
                                has been anticipated for the 
                                certification period.
            ``(7) Excess shelter expense deduction.--
                    ``(A) In general.--A household shall be entitled, 
                with respect to expenses other than expenses paid on 
                behalf of the household by a third party, to an excess 
                shelter expense deduction to the extent that the 
                monthly amount expended by a household for shelter 
                exceeds an amount equal to 50 percent of monthly 
                household income after all other applicable deductions 
                have been allowed.
                    ``(B) Maximum amount of deduction.--
                            ``(i) Prior to september 30, 1995.--In the 
                        case of a household that does not contain an 
                        elderly or disabled individual, during the 15-
                        month period ending September 30, 1995, the 
                        excess shelter expense deduction shall not 
                        exceed--
                                    ``(I) in the 48 contiguous States 
                                and the District of Columbia, $231 per 
                                month; and
                                    ``(II) in Alaska, Hawaii, Guam, and 
                                the Virgin Islands of the United 
                                States, $402, $330, $280, and $171 per 
                                month, respectively.
                            ``(ii) After september 30, 1995.--In the 
                        case of a household that does not contain an 
                        elderly or disabled individual, during the 15-
                        month period ending December 31, 1996, the 
                        excess shelter expense deduction shall not 
                        exceed--
                                    ``(I) in the 48 contiguous States 
                                and the District of Columbia, $247 per 
                                month; and
                                    ``(II) in Alaska, Hawaii, Guam, and 
                                the Virgin Islands of the United 
                                States, $429, $353, $300, and $182 per 
                                month, respectively.
                    ``(C) Standard utility allowance.--
                            ``(i) In general.--In computing the excess 
                        shelter expense deduction, a State agency may 
                        use a standard utility allowance in accordance 
                        with regulations promulgated by the Secretary, 
                        except that a State agency may use an allowance 
                        that does not fluctuate within a year to 
                        reflect seasonal variations.
                            ``(ii) Restrictions on heating and cooling 
                        expenses.--An allowance for a heating or 
                        cooling expense may not be used in the case of 
                        a household that--
                                    ``(I) does not incur a heating or 
                                cooling expense, as the case may be;
                                    ``(II) does incur a heating or 
                                cooling expense but is located in a 
                                public housing unit that has central 
                                utility meters and charges households, 
                                with regard to the expense, only for 
                                excess utility costs; or
                                    ``(III) shares the expense with, 
                                and lives with, another individual not 
                                participating in the food stamp 
                                program, another household 
                                participating in the food stamp 
                                program, or both, unless the allowance 
                                is prorated between the household and 
                                the other individual, household, or 
                                both.
                            ``(iii) Mandatory allowance.--
                                    ``(I) In general.--A State agency 
                                may make the use of a standard utility 
                                allowance mandatory for all households 
                                with qualifying utility costs if--
                                            ``(aa) the State agency has 
                                        developed 1 or more standards 
                                        that include the cost of 
                                        heating and cooling and 1 or 
                                        more standards that do not 
                                        include the cost of heating and 
                                        cooling; and
                                            ``(bb) the Secretary finds 
                                        that the standards will not 
                                        result in an increased cost to 
                                        the Secretary.
                                    ``(II) Household election.--A State 
                                agency that has not made the use of a 
                                standard utility allowance mandatory 
                                under subclause (I) shall allow a 
                                household to switch, at the end of a 
                                certification period, between the 
                                standard utility allowance and a
                                 deduction based on the actual utility 
costs of the household.
                            ``(iv) Availability of allowance to 
                        recipients of energy assistance.--
                                    ``(I) In general.--Subject to 
                                subclause (II), if a State agency 
                                elects to use a standard utility 
                                allowance that reflects heating or 
                                cooling costs, the standard utility 
                                allowance shall be made available to 
                                households receiving a payment, or on 
                                behalf of which a payment is made, 
                                under the Low-Income Home Energy 
                                Assistance Act of 1981 (42 U.S.C. 8621 
                                et seq.) or other similar energy 
                                assistance program, if the household 
                                still incurs out-of-pocket heating or 
                                cooling expenses in excess of any 
                                assistance paid on behalf of the 
                                household to an energy provider.
                                    ``(II) Separate allowance.--A State 
                                agency may use a separate standard 
                                utility allowance for households on 
                                behalf of which a payment described in 
                                subclause (I) is made, but may not be 
                                required to do so.
                                    ``(III) States not electing to use 
                                separate allowance.--A State agency 
                                that does not elect to use a separate 
                                allowance but makes a single standard 
                                utility allowance available to 
                                households incurring heating or cooling 
                                expenses (other than a household 
                                described in subclause (I) or (II) of 
                                subparagraph (C)(ii)) may not be 
                                required to reduce the allowance due to 
                                the provision (directly or indirectly) 
                                of assistance under the Low-Income Home 
                                Energy Assistance Act of 1981 (42 
                                U.S.C. 8621 et seq.).
                                    ``(IV) Proration of assistance.--
                                For the purpose of the food stamp 
                                program, assistance provided under the 
                                Low-Income Home Energy Assistance Act 
                                of 1981 (42 U.S.C. 8621 et seq.) shall 
                                be considered to be prorated over the 
                                entire heating or cooling season for 
                                which the assistance was provided.''.
    (b) Conforming Amendment.--Section 11(e)(3) of the Act (7 U.S.C. 
2020(e)(3)) is amended by striking ``. Under rules prescribed'' and all 
that follows through ``verifies higher expenses''.

SEC. 310. AMOUNT OF VEHICLE ASSET LIMITATION.

    The first sentence of section 5(g)(2) of the Food Stamp Act of 1977 
(7 U.S.C. 2014(g)(2)) is amended by striking ``through September 30, 
1995'' and all that follows through ``such date and on'' and inserting 
``and shall be adjusted on October 1, 1996, and''.

SEC. 311. BENEFITS FOR ALIENS.

    Section 5(i) of the Food Stamp Act of 1977 (7 U.S.C. 2014(i)) is 
amended--
            (1) in the first sentence of paragraph (1)--
                    (A) by inserting ``or who executed such an 
                affidavit or similar agreement to enable the individual 
                to lawfully remain in the United States,'' after 
                ``respect to such individual,''; and
                    (B) by striking ``for a period'' and all that 
                follows through the period at the end and inserting 
                ``until the end of the period ending on the later of 
                the date agreed to in the affidavit or agreement or the 
                date that is 5 years after the date on which the 
                individual was first lawfully admitted into the United 
                States following the execution of the affidavit or 
                agreement.''; and
            (2) in paragraph (2)--
                    (A) in subparagraph (C)(i), by striking ``of three 
                years after entry into the United States'' and 
                inserting ``determined under paragraph (1)''; and
                    (B) in subparagraph (D), by striking ``of three 
                years after such alien's entry into the United States'' 
                and inserting ``determined under paragraph (1)''.

SEC. 312. DISQUALIFICATION.

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

SEC. 313. CARETAKER EXEMPTION.

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

SEC. 314. EMPLOYMENT AND TRAINING.

    (a) In General.--Section 6(d)(4) of the Food Stamp Act of 1977 (7 
U.S.C. 2015(d)(4)) is amended--
            (1) in subparagraph (A)--
                    (A) by striking ``Not later than April 1, 1987, 
                each'' and inserting ``Each'';
                    (B) by inserting ``work,'' after ``skills, 
                training,''; and
                    (C) by adding at the end the following: ``Each 
                component of an employment and training program carried 
                out under this paragraph shall be delivered through the 
                statewide workforce development system established in 
                section 711 of the Work Opportunity Act of 1995, unless 
                the component is not available locally through the 
                statewide workforce development system.'';
            (2) in subparagraph (B)--
                    (A) in the matter preceding clause (i), by striking 
                the colon at the end and inserting the following: ``, 
                except that the State agency shall retain the option to 
                apply employment requirements prescribed under this 
                subparagraph to a program applicant at the time of 
                application:'';
                    (B) in clause (i), by striking ``with terms and 
                conditions'' and all that follows through ``time of 
                application''; and
                    (C) in clause (iv)--
                            (i) by striking subclauses (I) and (II); 
                        and
                            (ii) by redesignating subclauses (III) and 
                        (IV) as subclauses (I) and (II), respectively;
            (3) in subparagraph (D)--
                    (A) in clause (i), by striking ``to which the 
                application'' and all that follows through ``30 days or 
                less'';
                    (B) in clause (ii), by striking ``but with 
                respect'' and all that follows through ``child care''; 
                and
                    (C) in clause (iii), by striking ``, on the basis 
                of'' and all that follows through ``clause (ii)'' and 
                inserting ``the exemption continues to be valid'';
            (4) in subparagraph (E), by striking the third sentence;
            (5) in subparagraph (G)--
                    (A) by striking ``(G)(i) The State'' and inserting 
                ``(G) The State''; and
                    (B) by striking clause (ii);
            (6) in subparagraph (H), by striking ``(H)(i) The 
        Secretary'' and all that follows through ``(ii) Federal funds'' 
        and inserting ``(H) Federal funds'';
            (7) in subparagraph (I)(i)(II), by striking ``, or was in 
        operation,'' and all that follows through ``Social Security 
        Act'' and inserting the following: ``), except that no such 
        payment or reimbursement shall exceed the applicable local 
        market rate'';
            (8)(A) by striking subparagraphs (K) and (L) and inserting 
        the following:
                    ``(K) Limitation on funding.--Notwithstanding any 
                other provision of this paragraph, the amount of funds 
                a State agency uses to carry out this paragraph 
                (including under subparagraph (I)) for participants who 
                are receiving benefits under a State program funded 
                under part A of title IV of the Social Security Act (42 
                U.S.C. 601 et seq.) shall not exceed the amount of 
                funds the State agency used in fiscal year 1995 to 
                carry out this paragraph for participants who were 
                receiving benefits in fiscal year 1995 under a State 
                program funded under part A of title IV of the Act (42 
                U.S.C. 601 et seq.).''; and
            (B) by redesignating subparagraphs (M) and (N) as 
        subparagraphs (L) and (M), respectively; and
            (9) in subparagraph (L) (as redesignated by paragraph 
        (8)(B))--
                    (A) by striking ``(L)(i) The Secretary'' and 
                inserting ``(L) The Secretary''; and
                    (B) by striking clause (ii).
    (b) Effective Date.--The amendment made by subsection (a)(1)(C) 
shall take effect--
            (1) in a State described in section 815(b)(1), on July 1, 
        1997; and
            (2) in any other State, on July 1, 1998.
    (c) Funding.--Section 16(h) of the Act (7 U.S.C. 2025(h)) is 
amended by striking ``(h)(1)(A) The Secretary'' and all that follows 
through the end of paragraph (1) and inserting the following:
    ``(h) Funding of Employment and Training Programs.--
            ``(1) In general.--
                    ``(A) Amounts.--To carry out employment and 
                training programs, the Secretary shall reserve for 
                allocation to State agencies from funds made available 
                for each fiscal year under section 18(a)(1) the amount 
                of--
                            ``(i) for fiscal year 1996, $77,000,000;
                            ``(ii) for fiscal year 1997, $80,000,000;
                            ``(iii) for fiscal year 1998, $83,000,000;
                            ``(iv) for fiscal year 1999, $86,000,000;
                            ``(v) for fiscal year 2000, $89,000,000;
                            ``(vi) for fiscal year 2001, $92,000,000; 
                        and
                            ``(vii) for fiscal year 2002, $95,000,000.
                    ``(B) Allocation.--The Secretary shall allocate the 
                amounts reserved under subparagraph (A) among the State 
                agencies using a reasonable formula (as determined by 
                the Secretary) that gives consideration to the 
                population in each State affected by section 6(n).
                    ``(C) Reallocation.--
                            ``(i) Notification.--A State agency shall 
                        promptly notify the Secretary if the State 
                        agency determines that the State agency will 
                        not expend all of the funds allocated to the 
                        State agency under subparagraph (B).
                            ``(ii) Reallocation.--On notification under 
                        clause (i), the Secretary shall reallocate the 
                        funds that the State agency will not expend as 
                        the Secretary considers appropriate and 
                        equitable.
                    ``(D) Minimum allocation.--Notwithstanding 
                subparagraphs (A) through (C), the Secretary shall 
                ensure that each State agency operating an employment 
                and training program shall receive not less than 
                $50,000 in each fiscal year.''.
    (d) Reports.--Section 16(h) of the Act (7 U.S.C. 2025(h)) is 
amended--
            (1) in paragraph (5)--
                    (A) by striking ``(5)(A) The Secretary'' and 
                inserting ``(5) The Secretary''; and
                    (B) by striking subparagraph (B); and
            (2) by striking paragraph (6).

SEC. 315. COMPARABLE TREATMENT FOR DISQUALIFICATION.

    (a) In General.--Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 
2015) is amended--
            (1) by redesignating subsection (i) (as added by section 
        106) as subsection (o); and
            (2) by inserting after subsection (h) the following:
    ``(i) Comparable Treatment for Disqualification.--
            ``(1) In general.--If a disqualification is imposed on a 
        member of a household for a failure of the member to perform an 
        action required under a Federal, State, or local law relating 
        to a welfare or public assistance program, the State agency may 
        impose the same disqualification on the member of the household 
        under the food stamp program.
            ``(2) Application after disqualification period.--A member 
        of a household disqualified under paragraph (1) may, after the 
        disqualification period has expired, apply for benefits under 
        this Act and shall be treated as a new applicant, except that a 
        prior disqualification under subsection (d) shall be considered 
        in determining eligibility.''.
    (b) State Plan Provisions.--Section 11(e) of the Act (7 U.S.C. 
2020(e)) is amended--
            (1) in paragraph (24), by striking ``and'' at the end; and
            (2) by adding at the end the following:
            ``(26) the guidelines the State agency uses in carrying out 
        section 6(i);''.
    (c) Conforming Amendment.--Section 6(d)(2)(A) of the Act (7 U.S.C. 
2015(d)(2)(A)) is amended by striking ``that is comparable to a 
requirement of paragraph (1)''.

SEC. 316. COOPERATION WITH CHILD SUPPORT AGENCIES.

    Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015) (as amended 
by section 315) is further amended by inserting after subsection (i) 
the following:
    ``(j) Custodial Parent's Cooperation With Child Support Agencies.--
            ``(1) In general.--At the option of a State agency, subject 
        to paragraphs (2) and (3), no natural or adoptive parent or 
        other individual (collectively referred to in this subsection 
        as `the individual') who is living with and exercising parental 
        control over a child under the age of 18 who has an absent 
        parent shall be eligible to participate in the food stamp 
        program unless the individual cooperates with the State agency 
        administering the program established under part D of title IV 
        of the Social Security Act (42 U.S.C. 651 et seq.)--
                    ``(A) in establishing the paternity of the child 
                (if the child is born out of wedlock); and
                    ``(B) in obtaining support for--
                            ``(i) the child; or
                            ``(ii) the individual and the child.
            ``(2) Good cause for noncooperation.--Paragraph (1) shall 
        not apply to the individual if good cause is found for refusing 
        to cooperate, as determined by the State agency in accordance 
        with standards prescribed by the Secretary in consultation with 
        the Secretary of Health and Human Services. The standards shall 
        take into consideration circumstances under which cooperation 
        may be against the best interests of the child.
            ``(3) Fees.--Paragraph (1) shall not require the payment of 
        a fee or other cost for services provided under part D of title 
        IV of the Social Security Act (42 U.S.C. 651 et seq.).
    ``(k) Non-Custodial Parent's Cooperation With Child Support 
Agencies.--
            ``(1) In general.--At the option of a State agency, subject 
        to paragraphs (2) and (3), a putative or identified non-
        custodial parent of a child under the age of 18 (referred to in 
        this subsection as `the individual') shall not be eligible to 
        participate in the food stamp program if the individual refuses 
        to cooperate with the State agency administering the program 
        established under part D of title IV of the Social Security Act 
        (42 U.S.C. 651 et seq.)--
                    ``(A) in establishing the paternity of the child 
                (if the child is born out of wedlock); and
                    ``(B) in providing support for the child.
            ``(2) Refusal to cooperate.--
                    ``(A) Guidelines.--The Secretary, in consultation 
                with the Secretary of Health and Human Services, shall 
                develop guidelines on what constitutes a refusal to 
                cooperate under paragraph (1).
                    ``(B) Procedures.--The State agency shall develop 
                procedures, using guidelines developed under 
                subparagraph (A), for determining whether an individual 
                is refusing to cooperate under paragraph (1).
            ``(3) Fees.--Paragraph (1) shall not require the payment of 
        a fee or other cost for services provided under part D of title 
        IV of the Social Security Act (42 U.S.C. 651 et seq.).
            ``(4) Privacy.--The State agency shall provide safeguards 
        to restrict the use of information collected by a State agency 
        administering the program established under part D of title IV 
        of the Social Security Act (42 U.S.C. 651 et seq.) to purposes 
        for which the information is collected.''.

SEC. 317. DISQUALIFICATION FOR CHILD SUPPORT ARREARS.

    Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015) (as amended 
by section 316) is further amended by inserting after subsection (k) 
the following:
    ``(l) Disqualification for Child Support Arrears.--
            ``(1) In general.--At the option of a State agency, except 
        as provided in paragraph (2), no individual shall be eligible 
        to participate in the food stamp program as a member of any 
        household during any month that the individual is delinquent in 
        any payment due under a court order for the support of a child 
        of the individual.
            ``(2) Exceptions.--Paragraph (1) shall not apply if--
                    ``(A) a court is allowing the individual to delay 
                payment; or
                    ``(B) the individual is complying with a payment 
                plan approved by a court or the State agency designated 
                under part D of title IV of the Social Security Act (42 
                U.S.C. 651 et seq.) to provide support for the child of 
                the individual.''.

SEC. 318. PERMANENT DISQUALIFICATION FOR PARTICIPATING IN 2 OR MORE 
              STATES.

    Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015) (as amended 
by section 317) is further amended by inserting after subsection (l) 
the following:
    ``(m) Permanent Disqualification for Participating in 2 or More 
States.--An individual shall be permanently ineligible to participate 
in the food stamp program as a member of any household if the 
individual is found by a State agency to have made, or is convicted in 
Federal or State court of having made, a fraudulent statement or 
representation with respect to the place of residence of the individual 
in order to receive benefits simultaneously from 2 or more States under 
the food stamp program.''.

SEC. 319. WORK REQUIREMENT.

    (a) In General.--Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 
2015) (as amended by section 318) is further amended by inserting after 
subsection (m) the following:
    ``(n) Work Requirement.--
            ``(1) Definition of work program.--In this subsection, the 
        term `work program' means--
                    ``(A) a program under the Job Training Partnership 
                Act (29 U.S.C. 1501 et seq.);
                    ``(B) a program under section 236 of the Trade Act 
                of 1974 (19 U.S.C. 2296); or
                    ``(C) a program of employment or training operated 
                or supervised by a State or political subdivision of a 
                State that meets standards approved by the Governor of 
                the State, including a program under section 6(d)(4) 
                other than a job search program or a job search 
                training program under clause (i) or (ii) of section 
                6(d)(4)(B).
            ``(2) Work requirement.--No individual shall be eligible to 
        participate in the food stamp program as a member of any 
        household if, during the preceding 12-month period, the 
        individual received food stamp benefits for not less than 6 
        months during which the individual did not--
                    ``(A) work 20 hours or more per week, averaged 
                monthly; or
                    ``(B) participate in and comply with the 
                requirements of a work program for 20 hours or more per 
                week, as determined by the State agency.
            ``(3) Exception.--Paragraph (2) shall not apply to an 
        individual if the individual is--
                    ``(A) under 18 or over 50 years of age;
                    ``(B) medically certified as physically or mentally 
                unfit for employment;
                    ``(C) a parent or other member of a household with 
                responsibility for a dependent child; or
                    ``(D) otherwise exempt under section 6(d)(2).
            ``(4) Waiver.--
                    ``(A) In general.--On the request of a State 
                agency, the Secretary may waive the applicability of 
                paragraph (2) to any group of individuals in the State 
                if the Secretary makes a determination that the area in 
                which the individuals reside--
                            ``(i) has an unemployment rate of over 8 
                        percent; or
                            ``(ii) does not have a sufficient number of 
                        jobs to provide employment for the individuals.
                    ``(B) Report.--The Secretary shall report the basis 
                for a waiver under subparagraph (A) to the Committee on 
                Agriculture of the House of Representatives and the 
                Committee on Agriculture, Nutrition, and Forestry of 
                the Senate.''.
    (b) Transition Provision.--Prior to October 1, 1996, the term 
``preceding 12-month period'' in section 6(n)(2) of the Food Stamp Act 
of 1977 (as amended by subsection (a)) means the preceding period that 
begins on October 1, 1995.
SEC. 320. ELECTRONIC BENEFIT TRANSFERS.

    Section 7 of the Food Stamp Act of 1977 (7 U.S.C. 2016) is amended 
by adding at the end the following:
    ``(j) Electronic Benefit Transfers.--
            ``(1) Applicable law.--
                    ``(A) In general.--Disclosures, protections, 
                responsibilities, and remedies established by the 
                Federal Reserve Board under section 904 of the 
                Electronic Fund Transfer Act (15 U.S.C. 1693b) shall 
                not apply to benefits under this Act delivered through 
                any electronic benefit transfer system.
                    ``(B) Definition of electronic benefit transfer 
                system.--In this paragraph, the term `electronic 
                benefit transfer system' means a system under which a 
                governmental entity distributes benefits under this Act 
                or other benefits or payments by establishing accounts 
                to be accessed by recipients of the benefits 
                electronically, including through the use of an 
                automated teller machine, a point-of-sale terminal, or 
                an intelligent benefit card.
            ``(2) Charging for electronic benefit transfer card 
        replacement.--
                    ``(A) In general.--A State agency may charge an 
                individual for the cost of replacing a lost or stolen 
                electronic benefit transfer card.
                    ``(B) Reducing allotment.--A State agency may 
                collect a charge imposed under subparagraph (A) by 
                reducing the monthly allotment of the household of 
                which the individual is a member.
            ``(3) Optional photographic identification.--
                    ``(A) In general.--A State agency may require that 
                an electronic benefit card contain a photograph of 1 or 
                more members of a household.
                    ``(B) Other authorized users.--If a State agency 
                requires a photograph on an electronic benefit card 
                under subparagraph (A), the State agency shall 
                establish procedures to ensure that any other 
                appropriate member of the household or any authorized 
                representative of the household may utilize the 
                card.''.

SEC. 321. MINIMUM BENEFIT.

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

SEC. 322. BENEFITS ON RECERTIFICATION.

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

SEC. 323. OPTIONAL COMBINED ALLOTMENT FOR EXPEDITED HOUSEHOLDS.

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

SEC. 324. FAILURE TO COMPLY WITH OTHER WELFARE AND PUBLIC ASSISTANCE 
              PROGRAMS.

    Section 8 of the Food Stamp Act of 1977 (7 U.S.C. 2017) is amended 
by striking subsection (d) and inserting the following:
    ``(d) Reduction of Public Assistance Benefits.--
            ``(1) In general.--If the benefits of a household are 
        reduced under a Federal, State, or local law relating to a 
        welfare or public assistance program for the failure to perform 
        an action required under the law or program, for the duration 
        of the reduction--
                    ``(A) the household may not receive an increased 
                allotment as the result of a decrease in the income of 
                the household to the extent that the decrease is the 
                result of the reduction; and
                    ``(B) the State agency may reduce the allotment of 
                the household by not more than 25 percent.
            ``(2) Optional method.--In carrying out paragraph (1), a 
        State agency may consider, for the duration of a reduction 
        referred to under paragraph (1), the benefits of the household 
        under a welfare or public assistance program before the 
        reduction as income of the household after the reduction.''.
SEC. 325. ALLOTMENTS FOR HOUSEHOLDS RESIDING IN INSTITUTIONS.

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

SEC. 326. OPERATION OF FOOD STAMP OFFICES.

    Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020) is 
amended--
            (1) in subsection (e)--
                    (A) by striking paragraph (2) and inserting the 
                following:
            ``(2)(A) that the State agency shall establish procedures 
        governing the operation of food stamp offices that the State 
        agency determines best serve households in the State, including 
        households with special needs, such as households with elderly 
        or disabled members, households in rural areas with low-income 
        members, homeless individuals, households residing on 
        reservations, and households in which a substantial number of 
        members speak a language other than English.
            ``(B) In carrying out subparagraph (A), a State agency--
                    ``(i) shall provide timely, accurate, and fair 
                service to applicants for, and participants in, the 
                food stamp program;
                    ``(ii) shall permit an applicant household to apply 
                to participate in the program on the same day that the 
                household first contacts a food stamp office in person 
                during office hours;
                    ``(iii) shall consider an application filed on the 
                date the applicant submits an application that contains 
                the name, address, and signature of the applicant; and
                    ``(iv) may establish operating procedures that vary 
                for local food stamp offices to reflect regional and 
                local differences within the State;'';
                    (B) in paragraph (3) (as amended by section 
                309(b))--
                            (i) by striking ``shall--'' and all that 
                        follows through ``provide each'' and inserting 
                        ``shall provide each''; and
                            (ii) by striking ``(B) assist'' and all 
                        that follows through ``representative of the 
                        State agency;'';
                    (C) by striking paragraph (14) and inserting the 
                following:
            ``(14) the standards and procedures used by the State 
        agency under section 6(d)(1)(D) to determine whether an 
        individual is eligible to participate under section 
        6(d)(1)(A);''; and
                    (D) by striking paragraph (25) and inserting the 
                following:
            ``(25) a description of the work supplementation or support 
        program, if any, carried out by the State agency under section 
        16(b);''; and
            (2) in subsection (i)--
                    (A) by striking ``(i) Notwithstanding'' and all 
                that follows through ``(2)'' and inserting the 
                following:
    ``(i) Application and Denial Procedures.--
            ``(1) Application procedures.--Notwithstanding any other 
        provision of law,''; and
                    (B) by striking ``; (3) households'' and all that 
                follows through ``title IV of the Social Security Act. 
                No'' and inserting a period and the following:
            ``(2) Denial and termination.--Other than in a case of 
        disqualification as a penalty for failure to comply with a 
        public assistance program rule or regulation, no''.

SEC. 327. STATE EMPLOYEE AND TRAINING STANDARDS.

    Section 11(e)(6) of the Food Stamp Act of 1977 (7 U.S.C. 
2020(e)(6)) is amended--
            (1) by striking ``(A)''; and
            (2) by striking subparagraphs (B) through (E).

SEC. 328. EXCHANGE OF LAW ENFORCEMENT INFORMATION.

    Section 11(e) of the Food Stamp Act of 1977 (7 U.S.C. 2020(e)) (as 
amended by section 315(b)) is further amended--
            (1) in paragraph (8)--
                    (A) by striking ``that (A) such'' and inserting the 
                following: ``that--
                    ``(A) the'';
                    (B) by striking ``law, (B) notwithstanding'' and 
                inserting the following: ``law;
                    ``(B) notwithstanding'';
                    (C) by striking ``Act, and (C) such'' and inserting 
                the following: ``Act;
                    ``(C) the''; and
                    (D) by adding at the end the following:
                    ``(D) notwithstanding any other provision of law, 
                the address, social security number, and, when 
                available, photograph of any member of a household 
                shall be made available, on request, to any Federal, 
                State, or local law enforcement officer if the officer 
                furnishes the State agency with the name of the member 
                and notifies the agency that--
                            ``(i) the member--
                                    ``(I) is fleeing to avoid 
                                prosecution, or custody or confinement 
                                after conviction, for a crime (or 
                                attempt to commit a crime) that, under 
                                the law of the place the member is 
                                fleeing, is a felony (or, in the case 
                                of New Jersey, a high misdemeanor), or 
                                is violating a condition of probation 
                                or parole imposed under Federal or 
                                State law; or
                                    ``(II) has information that is 
                                necessary for the officer to conduct 
                                the official duties of the officer;
                            ``(ii) the location or apprehension of the 
                        member is an official duty of the officer; and
                            ``(iii) the request is being made in the 
                        proper exercise of the official duties of the 
                        officer; and
                    ``(E) the safeguards shall not prevent compliance 
                with paragraph (27);''; and
            (3) by adding at the end the following:
            ``(27) that the State agency shall furnish the Immigration 
        and Naturalization Service with the name of, address of, and 
        identifying information on any individual the State agency 
        knows is unlawfully in the United States; and''.

SEC. 329. EXPEDITED COUPON SERVICE.

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

SEC. 330. FAIR HEARINGS.

    Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020) is amended 
by adding at the end the following:
    ``(p) Withdrawing Fair Hearing Requests.--A household may withdraw, 
orally or in writing, a request by the household for a fair hearing 
under subsection (e)(10). If the withdrawal request is an oral request, 
the State agency shall provide a written notice to the household 
confirming the request and providing the household with an opportunity 
to request a hearing.''.

SEC. 331. INCOME AND ELIGIBILITY VERIFICATION SYSTEM.

    Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020) (as 
amended by section 330) is further amended by adding at the end the 
following:
    ``(q) State Verification Option.--Notwithstanding any other 
provision of law, a State agency shall not be required to use an income 
and eligibility verification system established under section 1137 of 
the Social Security Act (42 U.S.C. 1320b-7).''.

SEC. 332. COLLECTION OF OVERISSUANCES.

    (a) In General.--Section 13 of the Food Stamp Act of 1977 (7 U.S.C. 
2022) is amended--
            (1) by striking subsection (b) and inserting the following:
    ``(b) Collection of Overissuances.--
            ``(1) In general.--Except as otherwise provided in this 
        subsection, a State agency shall collect any overissuance of 
        coupons issued to a household by--
                    ``(A) reducing the allotment of the household;
                    ``(B) withholding unemployment compensation from a 
                member of the household under subsection (c);
                    ``(C) recovering from Federal pay or a Federal 
                income tax refund under subsection (d); or
                    ``(D) any other means.
            ``(2) Cost effectiveness.--Paragraph (1) shall not apply if 
        the State agency demonstrates to the satisfaction of the 
        Secretary that all of the means referred to in paragraph (1) 
        are not cost effective.
            ``(3) Hardships.--A State agency may not use an allotment 
        reduction under paragraph (1)(A) as a means of collecting an 
        overissuance from a household if the allotment reduction would 
        cause a hardship on the household, as determined by the State 
        agency.
            ``(4) Maximum reduction absent fraud.--If a household 
        received an overissuance of coupons without any member of the 
        household being found ineligible to participate in the program 
        under section 6(b)(1) and a State agency elects to reduce the 
        allotment of the household under paragraph (1)(A), the State 
        agency shall reduce the monthly allotment of the household 
        under paragraph (1)(A) by the greater of--
                    ``(A) 10 percent of the monthly allotment of the 
                household; or
                    ``(B) $10.
            ``(5) Procedures.--A State agency shall collect an 
        overissuance of coupons issued to a household under paragraph 
        (1) in accordance with requirements established by the State 
        agency for providing notice, electing a means of payment, and 
        establishing a time schedule for payment.''; and
            (2) in subsection (d)--
                    (A) by striking ``as determined under subsection 
                (b) and except for claims arising from an error of the 
                State agency,'' and inserting ``, as determined under 
                subsection (b)(1),''; and
                    (B) by inserting before the period at the end the 
                following: ``or a Federal income tax refund as 
                authorized by section 3720A of title 31, United States 
                Code''.
    (b) Conforming Amendment.--Section 11(e)(8) of the Act (7 U.S.C. 
2020(e)(8)) is amended--
            (1) by striking ``and excluding claims'' and all that 
        follows through ``such section''; and
            (2) by inserting before the semicolon at the end the 
        following: ``or a Federal income tax refund as authorized by 
        section 3720A of title 31, United States Code''.

SEC. 333. TERMINATION OF FEDERAL MATCH FOR OPTIONAL INFORMATION 
              ACTIVITIES.

    (a) In General.--Section 16(a) of the Food Stamp Act of 1977 (7 
U.S.C. 2025(a)) is amended--
            (1) by striking paragraph (4); and
            (2) by redesignating paragraphs (5) through (8) as 
        paragraphs (4) through (7), respectively.
    (b) Conforming Amendment.--Section 16(g) of the Act (7 U.S.C. 
2025(g)) is amended by striking ``an amount equal to'' and all that 
follows through ``1991, of'' and inserting ``the amount provided under 
subsection (a)(5) for''.

SEC. 334. STANDARDS FOR ADMINISTRATION.

    (a) In General.--Section 16 of the Food Stamp Act of 1977 (7 U.S.C. 
2025) is amended by striking subsection (b).
    (b) Conforming Amendments.--
            (1) The first sentence of section 11(g) of the Act (7 
        U.S.C. 2020(g)) is amended by striking ``the Secretary's 
        standards for the efficient and effective administration of the 
        program established under section 16(b)(1) or''.
            (2) Section 16(c)(1)(B) of the Act (7 U.S.C. 2025(c)(1)(B)) 
        is amended by striking ``pursuant to subsection (b)''.
SEC. 335. WORK SUPPLEMENTATION OR SUPPORT PROGRAM.

    Section 16 of the Food Stamp Act of 1977 (7 U.S.C. 2025) (as 
amended by section 334(a)) is further amended by inserting after 
subsection (a) the following:
    ``(b) Work Supplementation or Support Program.--
            ``(1) Definition.--In this subsection, the term `work 
        supplementation or support program' means a program in which, 
        as determined by the Secretary, public assistance (including 
        any benefits provided under a program established by the State 
        and the food stamp program) is provided to an employer to be 
        used for hiring and employing a new employee who is a public 
        assistance recipient.
            ``(2) Program.--A State agency may elect to use amounts 
        equal to the allotment that would otherwise be allotted to a 
        household under the food stamp program, but for the operation 
        of this subsection, for the purpose of subsidizing or 
        supporting jobs under a work supplementation or support program 
        established by the State.
            ``(3) Procedure.--If a State agency makes an election under 
        paragraph (2) and identifies each household that participates 
        in the food stamp program that contains an individual who is 
        participating in the work supplementation or support program--
                    ``(A) the Secretary shall pay to the State agency 
                an amount equal to the value of the allotment that the 
                household would be eligible to receive but for the 
                operation of this subsection;
                    ``(B) the State agency shall expend the amount paid 
                under subparagraph (A) in accordance with the work 
                supplementation or support program in lieu of providing 
                the allotment that the household would receive but for 
                the operation of this subsection;
                    ``(C) for purposes of--
                            ``(i) sections 5 and 8(a), the amount 
                        received under this subsection shall be 
                        excluded from household income and resources; 
                        and
                            ``(ii) section 8(b), the amount received 
                        under this subsection shall be considered to be 
                        the value of an allotment provided to the 
                        household; and
                    ``(D) the household shall not receive an allotment 
                from the State agency for the period during which the 
                member continues to participate in the work 
                supplementation or support program.
            ``(4) Other work requirements.--No individual shall be 
        excused, by reason of the fact that a State has a work 
        supplementation or support program, from any work requirement 
        under section 6(d), except during the periods in which the 
        individual is employed under the work supplementation or 
        support program.
            ``(5) Maximum length of participation.--A work 
        supplementation or support program may not allow the 
        participation of any individual for longer than 6 months, 
        unless the Secretary approves a longer period.''.

SEC. 336. WAIVER AUTHORITY.

    Section 17(b)(1)(A) of the Food Stamp Act of 1977 (7 U.S.C. 
2026(b)(1)(A)) is amended--
            (1) by striking ``benefits to eligible households, 
        including'' and inserting the following: ``benefits to eligible 
        households. The Secretary may waive the requirements of this 
        Act to the extent necessary to conduct a pilot or experimental 
        project, including a project designed to test innovative 
        welfare reform, promote work, and allow conformity with other 
        Federal, State, and local government assistance programs, 
        except that a project involving the payment of benefits in the 
        form of cash shall maintain the average value of allotments for 
        affected households as a group. Pilot or experimental projects 
        may include''; and
            (2) by striking ``The Secretary may waive'' and all that 
        follows through ``sections 5 and 8 of this Act.''.

SEC. 337. AUTHORIZATION OF PILOT PROJECTS.

    The last sentence of section 17(b)(1)(A) of the Food Stamp Act of 
1977 (7 U.S.C. 2026(b)(1)(A)) is amended by striking ``1995'' and 
inserting ``2002''.

SEC. 338. RESPONSE TO WAIVERS.

    Section 17(b)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
2026(b)(1)) is amended by adding at the end the following:
                    ``(C) Response to waivers.--
                            ``(i) Response.--Not later than 60 days 
                        after the date of receiving a request for a 
                        waiver under subparagraph (A), the Secretary 
                        shall provide a response that--
                                    ``(I) approves the waiver request;
                                    ``(II) denies the waiver request 
                                and explains any modification needed 
                                for approval of the waiver request;
                                    ``(III) denies the waiver request 
                                and explains the grounds for the 
                                denial; or
                                    ``(IV) requests clarification of 
                                the waiver request.
                            ``(ii) Failure to respond.--If the 
                        Secretary does not provide a response under 
                        clause (i) not later than 60 days after 
                        receiving a request for a waiver, the waiver 
                        shall be considered approved.
                            ``(iii) Notice of denial.--On denial of a 
                        waiver request under clause (i)(III), the 
                        Secretary shall provide a copy of the waiver 
                        request and the grounds for the denial to the 
                        Committee on Agriculture of the House of 
                        Representatives and the Committee on 
                        Agriculture, Nutrition, and Forestry of the 
                        Senate.''.

SEC. 339. PRIVATE SECTOR EMPLOYMENT INITIATIVES.

    Section 17 of the Food Stamp Act of 1977 (7 U.S.C. 2026) is amended 
by adding at the end the following:
    ``(m) Private Sector Employment Initiatives.--
            ``(1) Election to participate.--
                    ``(A) In general.--Subject to the other provisions 
                of this subsection, a State may elect to carry out a 
                private sector employment initiative program under this 
                subsection.
                    ``(B) Requirement.--A State shall be eligible to 
                carry out a private sector employment initiative under 
                this subsection only if not less than 50 percent of the 
                households that received food stamp benefits during the 
                summer of 1993 also received benefits under a State 
                program funded under part A of title IV of the Social 
                Security Act (42 U.S.C. 601 et seq.) during the summer 
                of 1993.
            ``(2) Procedure.--A State that has elected to carry out a 
        private sector employment initiative under paragraph (1) may 
        use amounts equal to the food stamp allotments that would 
        otherwise be allotted to a household under the food stamp 
        program, but for the operation of this subsection, to provide 
        cash benefits in lieu of the food stamp allotments to the 
        household if the household is eligible under paragraph (3).
            ``(3) Eligibility.--A household shall be eligible to 
        receive cash benefits under paragraph (2) if an adult member of 
        the household--
                    ``(A) has worked in unsubsidized employment in the 
                private sector for not less than the preceding 90 days;
                    ``(B) has earned not less than $350 per month from 
                the employment referred to in subparagraph (A) for not 
                less than the preceding 90 days;
                    ``(C)(i) is eligible to receive benefits under a 
                State program funded under part A of title IV of the 
                Social Security Act (42 U.S.C. 601 et seq.); or
                    ``(ii) was eligible to receive benefits under a 
                State program funded under part A of title IV of the 
                Social Security Act (42 U.S.C. 601 et seq.) at the time 
                the member first received cash benefits under this 
                subsection and is no longer eligible for the State 
                program because of earned income;
                    ``(D) is continuing to earn not less than $350 per 
                month from the employment referred to in subparagraph 
                (A); and
                    ``(E) elects to receive cash benefits in lieu of 
                food stamp benefits under this subsection.
            ``(4) Evaluation.--A State that operates a program under 
        this subsection for 2 years shall provide to the Secretary a 
        written evaluation of the impact of cash assistance under this 
        subsection. The State agency shall determine the content of the 
        evaluation.''.

SEC. 340. REAUTHORIZATION OF APPROPRIATIONS.

    The first sentence of section 18(a)(1) of the Food Stamp Act of 
1977 (7 U.S.C. 2027(a)(1)) is amended by striking ``1995'' and 
inserting ``2002''.

SEC. 341. REAUTHORIZATION OF PUERTO RICO NUTRITION ASSISTANCE PROGRAM.

    The first sentence of section 19(a)(1)(A) of the Food Stamp Act of 
1977 (7 U.S.C. 2028(a)(1)(A)) is amended by striking ``$974,000,000'' 
and all that follows through ``fiscal year 1995'' and inserting the 
following: ``$1,143,000,000 for each of fiscal years 1995 and 1996, 
$1,182,000,000 for fiscal year 1997, $1,223,000,000 for fiscal year 
1998, $1,266,000,000 for fiscal year 1999, $1,310,000,000 for fiscal 
year 2000, $1,343,000,000 for fiscal year 2001, and $1,376,000,000 for 
fiscal year 2002''

SEC. 342. SIMPLIFIED FOOD STAMP PROGRAM.

    (a) In General.--The Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.) 
is amended by adding at the end the following:

``SEC. 24. SIMPLIFIED FOOD STAMP PROGRAM.

    ``(a) Election.--Subject to subsection (c), a State agency may 
elect to carry out a Simplified Food Stamp Program (referred to in this 
section as a `Program') under this section.
    ``(b) Operation of Program.--
            ``(1) In general.--If a State agency elects to carry out a 
        Program, within the State or a political subdivision of the 
        State--
                    ``(A) a household in which all members receive 
                assistance under a State program funded under part A of 
                title IV of the Social Security Act (42 U.S.C. 601 et 
                seq.) shall automatically be eligible to participate in 
                the Program; and
                    ``(B) subject to subsection (e), benefits under the 
                Program shall be determined under rules and procedures 
                established by the State under--
                            ``(i) a State program funded under part A 
                        of title IV of the Social Security Act (42 
                        U.S.C. 601 et seq.);
                            ``(ii) the food stamp program (other than 
                        section 25); or
                            ``(iii) a combination of a State program 
                        funded under part A of title IV of the Social 
                        Security Act (42 U.S.C. 601 et seq.) and the 
                        food stamp program.
            ``(2) Shelter standard.--The State agency may elect to 
        apply 1 shelter standard to a household that receives a housing 
        subsidy and another shelter standard to a household that does 
        not receive the subsidy.
    ``(c) Approval of Program.--
            ``(1) State plan.--A State agency may not operate a Program 
        unless the Secretary approves a State plan for the operation of 
        the Program under paragraph (2).
            ``(2) Approval of plan.--
                    ``(A) In general.--The Secretary shall approve any 
                State plan to carry out a Program if the Secretary 
                determines that the plan--
                            ``(i) complies with this section; and
                            ``(ii) would not increase Federal costs 
                        incurred under this Act.
                    ``(B) Definition of federal costs.--In this 
                section, the term `Federal costs' does not include any 
                Federal costs incurred under section 17.
    ``(d) Increased Federal Costs.--
            ``(1) Determination.--
                    ``(A) In general.--The Secretary shall determine 
                whether a Program being carried out by a State agency 
                is increasing Federal costs under this Act.
                    ``(B) No excluded households.--In making a 
                determination under subparagraph (A), the Secretary 
                shall not require the State agency to collect or report 
                any information on households not included in the 
                Program.
                    ``(C) Alternative accounting periods.--The 
                Secretary may approve the request of a State agency to 
                apply alternative accounting periods to determine if 
                Federal costs do not exceed the Federal costs had the 
                State agency not elected to carry out the Program.
            ``(2) Notification.--If the Secretary determines that the 
        Program has increased Federal costs under this Act for any 
        fiscal year, the Secretary shall notify the State agency not 
        later than January 1 of the immediately succeeding fiscal year.
            ``(3) Return of funds.--
                    ``(A) In general.--If the Secretary determines that 
                the Program has increased Federal costs under this Act 
                for a 2-year period, including a fiscal year for which 
                notice was given under paragraph (2) and an immediately 
                succeeding fiscal year, the State agency shall pay to 
                the Treasury of the United States the amount of the 
                increased costs.
                    ``(B) Enforcement.--If the State agency does not 
                pay an amount due under subparagraph (A) on a date that 
                is not later than 90 days after the date of the 
                determination, the Secretary shall reduce amounts 
                otherwise due to the State agency for administrative 
                costs under section 16(a).
    ``(e) Rules and Procedures.--
            ``(1) In general.--Except as provided by paragraph (2), a 
        State may apply--
                    ``(A) the rules and procedures established by the 
                State under--
                            ``(i) the State program funded under part A 
                        of title IV of the Social Security Act (42 
                        U.S.C. 601 et seq.); or
                            ``(ii) the food stamp program; or
                    ``(B) the rules and procedures of 1 of the programs 
                to certain matters and the rules and procedures of the 
                other program to all remaining matters.
            ``(2) Standardized deductions.--The State may standardize 
        the deductions provided under section 5(e). In developing the 
        standardized deduction, the State shall give consideration to 
        the work expenses, dependent care costs, and shelter costs of 
        participating households.
            ``(3) Requirements.--In operating a Program, the State 
        shall comply with--
                    ``(A) subsections (a) through (g) of section 7;
                    ``(B) section 8(a), except that the income of a 
                household may be determined under a State program 
                funded under part A of title IV of the Social Security 
                Act (42 U.S.C. 601 et seq.);
                    ``(C) subsections (b) and (d) of section 8;
                    ``(D) subsections (a), (c), (d), and (n) of section 
                11;
                    ``(E) paragraph (3) of section 11(e), to the extent 
                that the paragraph requires that an eligible household 
                be certified and receive an allotment for the period of 
                application not later than 30 days after filing an 
                application;
                    ``(F) paragraphs (8), (9), (12), (17), (19), (21), 
                and (27) of section 11(e);
                    ``(G) section 11(e)(10) or a comparable requirement 
                established by the State under a State program funded 
                under part A of title IV of the Social Security Act (42 
                U.S.C. 601 et seq.); and
                    ``(H) section 16.''.
    (b) State Plan Provisions.--Section 11(e) of the Act (7 U.S.C. 
2020(e)) (as amended by sections 315(b) and 328) is further amended by 
adding at the end the following:
            ``(28) the plans of the State agency for operating, at the 
        election of the State, a program under section 24, including--
                    ``(A) the rules and procedures to be followed by 
                the State to determine food stamp benefits;
                    ``(B) how the State will address the needs of 
                households that experience high shelter costs in 
                relation to the incomes of the households; and
                    ``(C) a description of the method by which the 
                State will carry out a quality control system under 
                section 16(c).''.
    (c) Conforming Amendments.--
            (1) Section 8 of the Act (7 U.S.C. 2017) (as amended by 
        section 325) is further amended--
                    (A) by striking subsection (e); and
                    (B) by redesignating subsection (f) as subsection 
                (e).
            (2) Section 17 of the Act (7 U.S.C. 2026) (as amended by 
        section 339) is further amended--
                    (A) by striking subsection (i); and
                    (B) by redesignating subsections (j) through (m) as 
                subsections (i) through (l), respectively.

SEC. 343. OPTIONAL STATE FOOD ASSISTANCE BLOCK GRANT.

    (a) In General.--The Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.) 
(as amended by section 342) is further amended by adding at the end the 
following:

``SEC. 25. OPTIONAL STATE FOOD ASSISTANCE BLOCK GRANT.

    ``(a) Establishment.--The Secretary shall establish a program to 
make grants to States in accordance with this section to provide--
            ``(1) food assistance to needy individuals and families 
        residing in the State;
            ``(2) at the option of a State, wage subsidies and payments 
        in return for work for needy individuals under the program;
            ``(3) funds to operate an employment and training program 
        under section (g)(2) for needy individuals under the program; 
        and
            ``(4) funds for administrative costs incurred in providing 
        the assistance.
    ``(b) Election.--
            ``(1) In general.--The chief executive officer of a State 
        may elect to participate in the program established under 
        subsection (a).
            ``(2) Election irrevocable.--A State that elects to 
        participate in the program established under subsection (a) may 
        not subsequently elect to participate in the food stamp program 
        in accordance with any other section of this Act.
            ``(3) Program exclusive.--A State that is participating in 
        the program established under subsection (a) shall not be 
        subject to any requirement, or receive any benefit, under this 
        Act except as provided in this section.
    ``(c) Lead Agency.--
            ``(1) Designation.--The chief executive officer of a State 
        desiring to receive a grant under this section shall designate, 
        in an application submitted to the Secretary under subsection 
        (d)(1), an appropriate State agency that complies with 
        paragraph (2) to act as the lead agency for the State.
            ``(2) Duties.--
                    ``(A) In general.--The lead agency shall--
                            ``(i) administer, either directly, through 
                        other State agencies, or through local 
                        agencies, the assistance received under this 
                        section by the State;
                            ``(ii) develop the State plan to be 
                        submitted to the Secretary under subsection 
                        (d)(1);
                            ``(iii) in conjunction with the development 
                        of the State plan, hold at least 1 hearing in 
                        the State to provide to the public an 
                        opportunity to comment on the program under the 
                        State plan; and
                            ``(iv) coordinate the provision of food 
                        assistance under this section with other 
                        Federal, State, and local programs.
                    ``(B) Development of plan.--In the development of 
                the State plan described in subparagraph (A)(ii), the 
                lead agency shall consult with appropriate 
                representatives of units of local government on issues 
                relating to the State plan.
    ``(d) Application and Plan.--
            ``(1) Application.--To be eligible to receive assistance 
        under this section, a State shall prepare and submit to the 
        Secretary an application at such time, in such manner, and 
        containing such information as the Secretary shall by 
        regulation require, including--
                    ``(A) an assurance that the State will comply with 
                the requirements of this section;
                    ``(B) a State plan that meets the requirements of 
                paragraph (3); and
                    ``(C) an assurance that the State will comply with 
                the requirements of the State plan under paragraph (3).
            ``(2) Annual plan.--The State plan contained in the 
        application under paragraph (1) shall be submitted for approval 
        annually.
            ``(3) Requirements of plan.--
                    ``(A) Lead agency.--The State plan shall identify 
                the lead agency.
                    ``(B) Use of block grant funds.--The State plan 
                shall provide that the State shall use the amounts 
                provided to the State for each fiscal year under this 
                section--
                            ``(i) to provide food assistance to needy 
                        individuals and families residing in the State;
                            ``(ii) at the option of a State, to provide 
                        wage subsidies and payments in return for work 
                        under the program, including cash payments to 
                        needy individuals and families related to work 
                        effort;
                            ``(iii) to operate an employment and 
                        training program under section (g)(2) for needy 
                        individuals under the program; and
                            ``(iv) to pay administrative costs incurred 
                        in providing the assistance.
                    ``(C) Groups served.--The State plan shall describe 
                how the program will serve specific groups of 
                individuals and families and how the treatment will 
                differ from treatment under the food stamp program 
                under the other sections of this Act of the individuals 
                and families, including--
                            ``(i) elderly individuals and families;
                            ``(ii) migrants or seasonal farmworkers;
                            ``(iii) homeless individuals and families;
                            ``(iv) individuals and families who live 
                        under the supervision of institutions (other 
                        than incarcerated individuals);
                            ``(v) individuals and families with 
                        earnings; and
                            ``(vi) members of Indian tribes or tribal 
                        organizations.
                    ``(D) Assistance for entire state.--The State plan 
                shall provide that benefits under this section shall be 
                available throughout the entire State.
                    ``(E) Notice and hearings.--The State plan shall 
                provide that an individual or family who applies for, 
                or receives, assistance under this section shall be 
                provided with notice of, and an opportunity for a 
                hearing on, any action under this section that 
                adversely affects the individual or family.
                    ``(F) Other assistance.--
                            ``(i) Coordination.--The State plan may 
                        coordinate assistance received under this 
                        section with assistance provided under the 
                        State program funded under part A of title IV 
                        of the Social Security Act (42 U.S.C. 601 et 
                        seq.).
                            ``(ii) Penalties.--If an individual or 
                        family is penalized for violating part A of 
                        title IV of the Act, the State plan may reduce 
                        the amount of assistance provided under this 
                        section or otherwise penalize the individual or 
                        family.
                    ``(G) Assessment of Needs.--The State plan shall 
                assess the food and nutrition needs of needy persons 
                residing in the State.
                    ``(H) Eligibility limitations.--The State plan 
                shall describe the income and resource eligibility 
                limitations that are established for the receipt of 
                assistance under this section.
                    ``(I) Receiving benefits in more than 1 
                jurisdiction.--The State plan shall establish a system 
                to verify and otherwise ensure that no individual or 
                family shall receive benefits under this section in 
                more than 1 jurisdiction within the State.
                    ``(J) Privacy.--The State plan shall provide for 
                safeguarding and restricting the use and disclosure of 
                information about any individual or family receiving 
                assistance under this section.
                    ``(K) Other information.--The State plan shall 
                contain such other information as may be required by 
                the Secretary.
            ``(4) Approval of application and plan.--The Secretary 
        shall approve an application and State plan that satisfies the 
        requirements of this section.
    ``(e) Limitations on State Allotments.--
            ``(1) No individual or family entitlement to assistance.--
        Nothing in this section--
                    ``(A) entitles any individual or family to 
                assistance under this section; or
                    ``(B) limits the right of a State to impose 
                additional limitations or conditions on assistance 
                under this section.
            ``(2) Construction of facilities.--No funds made available 
        under this section shall be expended for the purchase or 
        improvement of land, or for the purchase, construction, or 
        permanent improvement of any building or facility.
    ``(f) Benefits for Aliens.--
            ``(1) Eligibility.--No individual shall be eligible to 
        receive benefits under a State plan approved under subsection 
        (d)(4) if the individual is not eligible to participate in the 
        food stamp program under section 6(f).
            ``(2) Income.--The State plan shall provide that the income 
        of an alien shall be determined in accordance with section 
        5(i).
    ``(g) Employment and Training.--
            ``(1) Work requirements.--No individual or member of a 
        family shall be eligible to receive benefits under a State plan 
        funded under this section if the individual is not eligible to 
        participate in the food stamp program under subsection (d) or 
        (n) of section 6.
            ``(2) Work programs.--Each State shall implement an 
        employment and training program under section 6(d)(4) for needy 
        individuals under the program.
    ``(h) Enforcement.--
            ``(1) Review of compliance with state plan.--The Secretary 
        shall review and monitor State compliance with this section and 
        the State plan approved under subsection (d)(4).
            ``(2) Noncompliance.--
                    ``(A) In general.--If the Secretary, after 
                reasonable notice to a State and opportunity for a 
                hearing, finds that--
                            ``(i) there has been a failure by the State 
                        to comply substantially with any provision or 
                        requirement set forth in the State plan 
                        approved under subsection (d)(4); or
                            ``(ii) in the operation of any program or 
                        activity for which assistance is provided under 
                        this section, there is a failure by the State 
                        to comply substantially with any provision of 
                        this section;
                the Secretary shall notify the State of the finding and 
                that no further payments will be made to the State 
                under this section (or, in the case of noncompliance in 
                the operation of a program or activity, that no further 
                payments to the State will be made with respect to the 
                program or activity) until the Secretary is satisfied 
                that there is no longer any failure to comply or that 
                the noncompliance will be promptly corrected.
                    ``(B) Other sanctions.--In the case of a finding of 
                noncompliance made pursuant to subparagraph (A), the 
                Secretary may, in addition to, or in lieu of, imposing 
                the sanctions described in subparagraph (A), impose 
                other appropriate sanctions, including recoupment of 
                money improperly expended for purposes prohibited or 
                not authorized by this section and disqualification 
                from the receipt of financial assistance under this 
                section.
                    ``(C) Notice.--The notice required under 
                subparagraph (A) shall include a specific 
                identification of any additional sanction being imposed 
                under subparagraph (B).
            ``(3) Issuance of regulations.--The Secretary shall 
        establish by regulation procedures for--
                    ``(A) receiving, processing, and determining the 
                validity of complaints concerning any failure of a 
                State to comply with the State plan or any requirement 
                of this section; and
                    ``(B) imposing sanctions under this section.
            ``(4) Income and eligibility verification system.--The 
        Secretary may withhold not more than 5 percent of the amount 
        allotted to a State under subsection (l)(2) if the State does 
        not use an income and eligibility verification system 
        established under section 1137 of the Social Security Act (42 
        U.S.C. 1320b-7).
    ``(i) Payments.--
            ``(1) In general.--For each fiscal year, the Secretary 
        shall pay to a State that has an application approved by the 
        Secretary under subsection (d)(4) an amount that is equal to 
        the allotment of the State under subsection (l)(2) for the 
        fiscal year.
            ``(2) Method of payment.--The Secretary shall make payments 
        to a State for a fiscal year under this section by issuing 1 or 
        more letters of credit for the fiscal year, with necessary 
        adjustments on account of overpayments or underpayments, as 
        determined by the Secretary.
            ``(3) Spending of funds by state.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), payments to a State from an allotment 
                under subsection (l)(2) for a fiscal year may be 
                expended by the State only in the fiscal year.
                    ``(B) Carryover.--The State may reserve up to 10 
                percent of an allotment under subsection (l)(2) for a 
                fiscal year to provide assistance under this section in 
                subsequent fiscal years, except that the reserved funds 
                may not exceed 30 percent of the total allotment 
                received under this section for a fiscal year.
            ``(4) Food assistance and administrative expenditures.--In 
        each fiscal year, of the Federal funds expended by a State 
        under this section--
                    ``(A) not less than 75 percent shall be for food 
                assistance; and
                    ``(B) not more than 6 percent shall be for 
                administrative expenses.
            ``(5) Provision of food assistance.--A State may provide 
        food assistance under this section in any manner determined 
        appropriate by the State to provide food assistance to needy 
        individuals and families in the State, such as electronic 
        benefits transfer limited to food purchases, coupons limited to 
        food purchases, or direct provision of commodities.
            ``(6) Definition of food assistance.--In this section, the 
        term `food assistance' means assistance that may be used only 
        to obtain food, as defined in section 3(g).
    ``(j) Audits.--
            ``(1) Requirement.--After the close of each fiscal year, a 
        State shall arrange for an audit of the expenditures of the 
        State during the program period from amounts received under 
        this section.
            ``(2) Independent auditor.--An audit under this section 
        shall be conducted by an entity that is independent of any 
        agency administering activities that receive assistance under 
        this section and be in accordance with generally accepted 
        auditing principles.
            ``(3) Payment accuracy.--Each annual audit under this 
        section shall include an audit of payment accuracy under this 
        section that shall be based on a statistically valid sample of 
        the caseload in the State.
            ``(4) Submission.--Not later than 30 days after the 
        completion of an audit under this section, the State shall 
        submit a copy of the audit to the legislature of the State and 
        to the Secretary.
            ``(5) Repayment of amounts.--Each State shall repay to the 
        United States any amounts determined through an audit under 
        this section to have not been expended in accordance with this 
        section or to have not been expended in accordance with the 
        State plan, or the Secretary may offset the amounts against any 
        other amount paid to the State under this section.
    ``(k) Nondiscrimination.--
            ``(1) In general.--The Secretary shall not provide 
        financial assistance for any program, project, or activity 
        under this section if any person with responsibilities for the 
        operation of the program, project, or activity discriminates 
        with respect to the program, project, or activity because of 
        race, religion, color, national origin, sex, or disability.
            ``(2) Enforcement.--The powers, remedies, and procedures 
        set forth in title VI of the Civil Rights Act of 1964 (42 
        U.S.C. 2000d et seq.) may be used by the Secretary to enforce 
        paragraph (1).
    ``(l) Allotments.--
            ``(1) Definition of state.--In this section, the term 
        `State' means each of the 50 States, the District of Columbia, 
        Guam, and the Virgin Islands of the United States.
            ``(2) State allotment.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), from the amounts made available under 
                section 18 of this Act for each fiscal year, the 
                Secretary shall allot to each State participating in 
                the program established under this section an amount 
                that is equal to the sum of--
                            ``(i) the greater of, as determined by the 
                        Secretary--
                                    ``(I) the total dollar value of all 
                                benefits issued under the food stamp 
                                program established under this Act by 
                                the State during fiscal year 1994; or
                                    ``(II) the average per fiscal year 
                                of the total dollar value of all 
                                benefits issued under the food stamp 
                                program by the State during each of 
                                fiscal years 1992 through 1994; and
                            ``(ii) the greater of, as determined by the 
                        Secretary--
                                    ``(I) the total amount received by 
                                the State for administrative costs and 
                                the employment and training program 
                                under subsections (a) and (h), 
                                respectively, of section 16 of this Act 
                                for fiscal year 1994; or
                                    ``(II) the average per fiscal year 
                                of the total amount received by the 
                                State for administrative costs and the 
                                employment and training program under 
                                subsections (a) and (h), respectively, 
                                of section 16 of this Act for each of 
                                fiscal years 1992 through 1994.
                    ``(B) Insufficient funds.--If the Secretary finds 
                that the total amount of allotments to which States 
                would otherwise be entitled for a fiscal year under 
                subparagraph (A) will exceed the amount of funds that 
                will be made available to provide the allotments for 
                the fiscal year, the Secretary shall reduce the 
                allotments made to States under this subsection, on a 
                pro rata basis, to the extent necessary to allot under 
                this subsection a total amount that is equal to the 
                funds that will be made available.''.
    (b) Research On Optional State Food Assistance Block Grant.--
Section 17 of the Food Stamp Act of 1977 (7 U.S.C. 2026) (as amended by 
section 339 and 342(c)(2)) is further amended by adding at the end the 
following:
    ``(m) Research On Optional State Food Assistance Block Grant.--The 
Secretary may conduct research on the effects and costs of a State 
program carried out under section 25.''.
SEC. 344. EFFECTIVE DATE.

    Except as otherwise provided in this subtitle, this subtitle and 
the amendments made by this subtitle shall become effective on October 
1, 1995.

                 Subtitle B--Anti-Fraud and Trafficking

SEC. 351. EXPANDED DEFINITION OF COUPON.

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

SEC. 352. DOUBLED PENALTIES FOR VIOLATING FOOD STAMP PROGRAM 
              REQUIREMENTS.

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

SEC. 353. AUTHORITY TO ESTABLISH AUTHORIZATION PERIODS.

    Section 9(a) of the Food Stamp Act of 1977 (7 U.S.C. 2018(a)) is 
amended by adding at the end the following:
            ``(3) Authorization periods.--The Secretary is authorized 
        to issue regulations establishing specific time periods during 
        which authorization to accept and redeem coupons under the food 
        stamp program shall be valid.''.

SEC. 354. SPECIFIC PERIOD FOR PROHIBITING PARTICIPATION OF STORES BASED 
              ON LACK OF BUSINESS INTEGRITY.

    Section 9(a) of the Food Stamp Act of 1977 (7 U.S.C. 2018(a)) (as 
amended by section 353) is further amended by adding at the end the 
following:
            ``(4) Periods for participation of stores and concerns.--
        The Secretary may issue regulations establishing specific time 
        periods during which a retail food store or wholesale food 
        concern that has an application for approval to accept and 
        redeem coupons denied, or that has an approval withdrawn, on 
        the basis of business integrity and reputation cannot submit a 
        new application for approval. The periods shall reflect the 
        severity of business integrity infractions that are the basis 
        of the denials or withdrawals.''.

SEC. 355. INFORMATION FOR VERIFYING ELIGIBILITY FOR AUTHORIZATION.

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

SEC. 356. WAITING PERIOD FOR STORES THAT INITIALLY FAIL TO MEET 
              AUTHORIZATION CRITERIA.

    Section 9(d) of the Food Stamp Act of 1977 (7 U.S.C. 2018(d)) is 
amended by adding at the end the following: ``A retail food store or 
wholesale food concern that has an application for approval to accept 
and redeem coupons denied because the store or concern does not meet 
criteria for approval established by the Secretary by regulation may 
not submit a new application for 6 months after the date of the 
denial.''.
SEC. 357. BASES FOR SUSPENSIONS AND DISQUALIFICATIONS.

    Section 12 of the Food Stamp Act of 1977 (7 U.S.C. 2021) is 
amended--
            (1) by striking the section heading;
            (2) by striking ``Sec. 12 (a) Any'' and inserting the 
        following:

``SEC. 12. CIVIL MONEY PENALTIES AND DISQUALIFICATION OF RETAIL FOOD 
              STORES AND WHOLESALE FOOD CONCERNS.

    ``(a) Disqualification.--
            ``(1) In general.--Any''; and
            (3) in subsection (a), by adding at the end the following:
            ``(2) Basis.--Regulations issued pursuant to this Act shall 
        provide criteria for the finding of a violation, and the 
        suspension or disqualification of a retail food store or 
        wholesale food concern, on the basis of evidence that may 
        include facts established through on-site investigations, 
        inconsistent redemption data, or evidence obtained through 
        transaction reports under electronic benefits transfer 
        systems.''.

SEC. 358. DISQUALIFICATION OF STORES PENDING JUDICIAL AND 
              ADMINISTRATIVE REVIEW.

    (a) Authority.--Section 12(a) of the Food Stamp Act of 1977 (7 
U.S.C. 2021(a)) (as amended by section 357) is further amended by 
adding at the end the following:
            ``(3) Disqualification pending review.--The regulations may 
        establish criteria under which the authorization of a retail 
        food store or wholesale food concern to accept and redeem 
        coupons may be suspended at the time the store or concern is 
        initially found to have committed a violation of a requirement 
        of the food stamp program that would result in a permanent 
        disqualification. The suspension may coincide with the period 
        of a review under section 14. The Secretary shall not be liable 
        for the value of any sales lost during a suspension or 
        disqualification period.''.
    (b) Review.--Section 14(a) of the Act (7 U.S.C. 2023(a)) is 
amended--
            (1) in the first sentence, by striking ``disqualified or 
        subjected'' and inserting ``suspended, disqualified, or 
        subjected'';
            (2) in the fifth sentence, by inserting before the period 
        at the end the following: ``, except that, in the case of the 
        suspension of a retail food store or wholesale food concern 
        under section 12(a)(3), the suspension shall remain in effect 
        pending any judicial or administrative review of the proposed 
        disqualification action, and the period of suspension shall be 
        considered a part of any period of disqualification that is 
        imposed''; and
            (3) by striking the last sentence.

SEC. 359. DISQUALIFICATION OF RETAILERS WHO ARE DISQUALIFIED UNDER THE 
              WIC PROGRAM.

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

SEC. 360. PERMANENT DEBARMENT OF RETAILERS WHO INTENTIONALLY SUBMIT 
              FALSIFIED APPLICATIONS.

    Section 12 of the Food Stamp Act of 1977 (7 U.S.C. 2021) (as 
amended by section 359) is further amended by adding at the end the 
following:
    ``(h) Falsified Applications.--
            ``(1) In general.--The Secretary shall issue regulations 
        providing for the permanent disqualification of a retail food 
        store, or wholesale food concern, that knowingly submits an 
        application for approval to accept and redeem coupons that 
        contains false information about a substantive matter that was, 
        or could have been, a basis for approving the application.
            ``(2) Review.--A disqualification under paragraph (1) shall 
        be subject to judicial and administrative review under section 
        14, except that the disqualification shall remain in effect 
        pending the review.''.
SEC. 361. EXPANDED CRIMINAL FORFEITURE FOR VIOLATIONS.

    (a) Forfeiture of Items Exchanged in Food Stamp Trafficking.--The 
first sentence of section 15(g) of the Food Stamp Act of 1977 (7 U.S.C. 
2024(g)) is amended by striking ``or intended to be furnished''.
    (b) Criminal Forfeiture.--Section 15 of the Act (7 U.S.C. 2024)) is 
amended by adding at the end the following:
    ``(h) Criminal Forfeiture.--
                    ``(A) In general.--Any person convicted of 
                violating subsection (b) or (c) involving food stamp 
                benefits having an aggregate value of not less than 
                $5,000, shall forfeit to the United States--
                            ``(i) any food stamp benefits and any 
                        property constituting, or derived from, or 
                        traceable to any proceeds the person obtained 
                        directly or indirectly as a result of the 
                        violation; and
                            ``(ii) any food stamp benefits and any 
                        property of the person used, or intended to be 
                        used, in any manner or part, to commit, or to 
                        facilitate the commission of the violation.
                    ``(B) Sentence.--In imposing a sentence on a person 
                under subparagraph (A), a court shall order that the 
                person forfeit to the United States all property 
                described in this subsection.
                    ``(C) Procedures.--Any food stamp benefits or 
                property subject to forfeiture under this subsection, 
                any seizure or disposition of the benefits or property, 
                and any administrative or judicial proceeding relating 
                to the benefits or property, shall be governed by 
                subsections (b), (c), (e), and (g) through (p) of 
                section 413 of the Comprehensive Drug Abuse Prevention 
                and Control Act of 1970 (21 U.S.C. 853), if not 
                inconsistent with this subsection.
            ``(3) Excluded property.--This subsection shall not apply 
        to property referred to in subsection (g).''.

SEC. 362. EFFECTIVE DATE.

    This subtitle and the amendments made by this subtitle shall become 
effective on October 1, 1995.

                   TITLE IV--CHILD NUTRITION PROGRAMS

                    Subtitle A--Reimbursement Rates

SEC. 401. TERMINATION OF ADDITIONAL PAYMENT FOR LUNCHES SERVED IN HIGH 
              FREE AND REDUCED PRICE PARTICIPATION SCHOOLS.

    (a) In General.--Section 4(b)(2) of the National School Lunch Act 
(42 U.S.C. 1753(b)(2)) is amended by striking ``except that'' and all 
that follows through ``2 cents more''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
become effective on July 1, 1996.

SEC. 402. VALUE OF FOOD ASSISTANCE.

    (a) In General.--Section 6(e)(1) of the National School Lunch Act 
(42 U.S.C. 1755(e)(1)) is amended by striking subparagraph (B) and 
inserting the following:
                    ``(B) Adjustments.--
                            ``(i) In general.--The value of food 
                        assistance for each meal shall be adjusted each 
                        July 1 by the annual percentage change in a 3-
                        month average value of the Price Index for 
                        Foods Used in Schools and Institutions for 
                        March, April, and May each year.
                            ``(ii) Adjustments.--Except as otherwise 
                        provided in this subparagraph, in the case of 
                        each school year, the Secretary shall--
                                    ``(I) base the adjustment made 
                                under clause (i) on the amount of the 
                                unrounded adjustment for the preceding 
                                school year;
                                    ``(II) adjust the resulting amount 
                                in accordance with clause (i); and
                                    ``(III) round the result to the 
                                nearest lower cent increment.
                            ``(iii) Adjustment on january 1, 1996.--On 
                        January 1, 1996, the Secretary shall adjust the 
                        value of food assistance for the remainder of 
                        the school year by rounding the previously 
                        established value of food assistance to the 
                        nearest lower cent increment.
                            ``(iv) Adjustment for 1996-97 school 
                        year.--In the case of the school year beginning 
                        July 1, 1996, the value of food assistance 
                        shall be the same as the value of food 
                        assistance in effect on June 30, 1996.
                            ``(v) Adjustment for 1997-98 school year.--
                        In the case of the school year beginning July 
                        1, 1997, the Secretary shall--
                                    ``(I) base the adjustment made 
                                under clause (i) on the amount of the 
                                unrounded adjustment for the value of 
                                food assistance for the school year 
                                beginning July 1, 1995;
                                    ``(II) adjust the resulting amount 
                                to reflect the annual percentage change 
                                in a 3-month average value of the Price 
                                Index for Foods Used in Schools and 
                                Institutions for March, April, and May 
                                for the most recent 12-month period for 
                                which the data are available; and
                                    ``(III) round the result to the 
                                nearest lower cent increment.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
become effective on January 1, 1996.

SEC. 403. LUNCHES, BREAKFASTS, AND SUPPLEMENTS.

    (a) In General.--Section 11(a)(3)(B) of the National School Lunch 
Act (42 U.S.C. 1759a(a)(3)(B)) is amended--
            (1) by designating the second and third sentences as 
        subparagraphs (C) and (D), respectively; and
            (2) by striking subparagraph (D) (as so designated) and 
        inserting the following:
                    ``(D) Rounding.--Except as otherwise provided in 
                this paragraph, in the case of each school year, the 
                Secretary shall--
                            ``(i) base the adjustment made under this 
                        paragraph on the amount of the unrounded 
                        adjustment for the preceding school year;
                            ``(ii) adjust the resulting amount in 
                        accordance with subparagraphs (B) and (C); and
                            ``(iii) round the result to the nearest 
                        lower cent increment.
                    ``(E) Adjustment on january 1, 1996.--On January 1, 
                1996, the Secretary shall adjust the rates and factor 
                for the remainder of the school year by rounding the 
                previously established rates and factor to the nearest 
                lower cent increment.
                    ``(F) Adjustment for 24-month period beginning july 
                1, 1996.--In the case of the 24-month period beginning 
                July 1, 1996, the national average payment rates for 
                paid lunches, paid breakfasts, and paid supplements 
                shall be the same as the national average payment rate 
                for paid lunches, paid breakfasts, and paid 
                supplements, respectively, for the school year 
                beginning July 1, 1995, rounded to the nearest lower 
                cent increment.
                    ``(G) Adjustment for school year beginning july 1, 
                1998.--In the case of the school year beginning July 1, 
                1998, the Secretary shall--
                            ``(i) base the adjustments made under this 
                        paragraph for--
                                    ``(I) paid lunches and paid 
                                breakfasts on the amount of the 
                                unrounded adjustment for paid lunches 
                                for the school year beginning July 1, 
                                1995; and
                                    ``(II) paid supplements on the 
                                amount of the unrounded adjustment for 
                                paid supplements for the school year 
                                beginning July 1, 1995;
                            ``(ii) adjust each resulting amount in 
                        accordance with subparagraph (C); and
                            ``(iii) round each result to the nearest 
                        lower cent increment.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
become effective on January 1, 1996.

SEC. 404. SUMMER FOOD SERVICE PROGRAM FOR CHILDREN.

    (a) In General.--Section 13(b) of the National School Lunch Act (42 
U.S.C. 1761(b)) is amended--
            (1) by striking ``(b)(1)'' and all that follows through the 
        end of paragraph (1) and inserting the following:
    ``(b) Service Institutions.--
            ``(1) Payments.--
                    ``(A) In general.--Except as otherwise provided in 
                this paragraph, payments to service institutions shall 
                equal the full cost of food service operations (which 
                cost shall include the costs of obtaining, preparing, 
                and serving food, but shall not include administrative 
                costs).
                    ``(B) Maximum amounts.--Subject to subparagraph 
                (C), payments to any institution under subparagraph (A) 
                shall not exceed--
                            ``(i) $2 for each lunch and supper served;
                            ``(ii) $1.20 for each breakfast served; and
                            ``(iii) 50 cents for each meal supplement 
                        served.
                    ``(C) Adjustments.--Amounts specified in 
                subparagraph (B) shall be adjusted each January 1 to 
                the nearest lower cent increment in accordance with the 
                changes for the 12-month period ending the preceding 
                November 30 in the series for food away from home of 
                the Consumer Price Index for All Urban Consumers 
                published by the Bureau of Labor Statistics of the 
                Department of Labor. Each adjustment shall be based on 
                the unrounded adjustment for the prior 12-month 
                period.'';
            (2) in the second sentence of paragraph (3), by striking 
        ``levels determined'' and all that follows through ``this 
        subsection'' and inserting ``level determined by the 
        Secretary''; and
            (3) by striking paragraph (4).
    (b) Effective Date.--The amendments made by subsection (a) shall 
become effective on January 1, 1996.
SEC. 405. SPECIAL MILK PROGRAM.

    (a) In General.--Section 3(a) of the Child Nutrition Act of 1966 
(42 U.S.C. 1772(a)) is amended by striking paragraph (8) and inserting 
the following:
            ``(8) Adjustments.--
                    ``(A) In general.--Except as otherwise provided in 
                this paragraph, in the case of each school year, the 
                Secretary shall--
                            ``(i) base the adjustment made under 
                        paragraph (7) on the amount of the unrounded 
                        adjustment for the preceding school year;
                            ``(ii) adjust the resulting amount in 
                        accordance with paragraph (7); and
                            ``(iii) round the result to the nearest 
                        lower cent increment.
                    ``(B) Adjustment on january 1, 1996.--On January 1, 
                1996, the Secretary shall adjust the minimum rate for 
                the remainder of the school year by rounding the 
                previously established minimum rate to the nearest 
                lower cent increment.
                    ``(C) Adjustment for 1996-97 school year.--In the 
                case of the school year beginning July 1, 1996, the 
                minimum rate shall be the same as the minimum rate in 
                effect on June 30, 1996.
                    ``(D) Adjustment for 1997-98 school year.--In the 
                case of the school year beginning July 1, 1997, the 
                Secretary shall--
                            ``(i) base the adjustment made under 
                        paragraph (7) on the amount of the unrounded 
                        adjustment for the minimum rate for the school 
                        year beginning July 1, 1995;
                            ``(ii) adjust the resulting amount to 
                        reflect changes in the Producer Price Index for 
                        Fresh Processed Milk published by the Bureau of 
                        Labor Statistics of the Department of Labor for 
                        the most recent 12-month period for which the 
                        data are available; and
                            ``(iii) round the result to the nearest 
                        lower cent increment.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
become effective on January 1, 1996.

SEC. 406. FREE AND REDUCED PRICE BREAKFASTS.

    (a) In General.--Section 4(b) of the Child Nutrition Act of 1966 
(42 U.S.C. 1773(b)) is amended--
            (1) in the second sentence of paragraph (1)(B), by striking 
        ``, adjusted to the nearest one-fourth cent'' and inserting 
        ``(as adjusted pursuant to section 11(a) of the National School 
        Lunch Act (42 U.S.C. 1759a(a))''; and
            (2) in paragraph (2)(B)(ii)--
                    (A) by striking ``nearest one-fourth cent'' and 
                inserting ``nearest lower cent increment for the 
                applicable school year''; and
                    (B) by inserting before the period at the end the 
                following: ``, and the adjustment required by this 
                clause shall be based on the unrounded adjustment for 
                the preceding school year''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
become effective on July 1, 1996.

SEC. 407. CONFORMING REIMBURSEMENT FOR PAID BREAKFASTS AND LUNCHES.

    (a) In General.--The last sentence of section 4(b)(1)(B) of the 
Child Nutrition Act of 1966 (42 U.S.C. 1773(b)(1)(B)) is amended by 
striking ``8.25 cents'' and all that follows through ``Act)'' and 
inserting ``the same as the national average lunch payment for paid 
meals established under section 4(b) of the National School Lunch Act 
(42 U.S.C. 1753(b))''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
become effective on January 1, 1996.

                       Subtitle B--Grant Programs

SEC. 411. SCHOOL BREAKFAST STARTUP GRANTS.

    Section 4 of the Child Nutrition Act of 1966 (42 U.S.C. 1773) is 
amended by striking subsection (g).

SEC. 412. NUTRITION EDUCATION AND TRAINING PROGRAMS.

    Section 19(i)(2)(A) of the Child Nutrition Act of 1966 (42 U.S.C. 
1788(i)(2)(A)) is amended by striking ``$10,000,000'' and inserting 
``$7,000,000''.

SEC. 413. EFFECTIVE DATE.

    The amendments made by this subtitle shall become effective on 
October 1, 1996.

                      Subtitle C--Other Amendments

SEC. 421. FREE AND REDUCED PRICE POLICY STATEMENT.

    (a) School Lunch Program.--Section 9(b)(2) of the National School 
Lunch Act (42 U.S.C. 1758(b)(2)) is amended by adding at the end the 
following:
                    ``(D) Free and reduced price policy statement.--
                After the initial submission, a school shall not be 
                required to submit a free and reduced price policy 
                statement to a State educational agency under this Act 
                unless there is a substantive change in the free and 
                reduced price policy of the school. A routine change in 
                the policy of a school, such as an annual adjustment of 
                the income eligibility guidelines for free and reduced 
                price meals, shall not be sufficient cause for 
                requiring the school to submit a policy statement.''.
    (b) School Breakfast Program.--Section 4(b)(1) of the Child 
Nutrition Act of 1966 (42 U.S.C. 1773(b)(1)) is amended by adding at 
the end the following:
                    ``(E) Free and reduced price policy statement.--
                After the initial submission, a school shall not be 
                required to submit a free and reduced price policy 
                statement to a State educational agency under this Act 
                unless there is a substantive change in the free and 
                reduced price policy of the school. A routine change in 
                the policy of a school, such as an annual adjustment of 
                the income eligibility guidelines for free and reduced 
                price meals, shall not be sufficient cause for 
                requiring the school to submit a policy statement.''.
SEC. 422. SUMMER FOOD SERVICE PROGRAM FOR CHILDREN.

    (a) Permitting Offer Versus Serve.--Section 13(f) of the National 
School Lunch Act (42 U.S.C. 1761(f)) is amended--
            (1) by striking ``(f) Service'' and inserting the 
        following:
    ``(f) Nutritional Standards.--
            ``(1) In general.--Service''; and
            (2) by adding at the end the following:
            ``(2) Offer versus serve.--A school food authority 
        participating as a service institution may permit a child 
        attending a site on school premises operated directly by the 
        authority to refuse not more than 1 item of a meal that the 
        child does not intend to consume. A refusal of an offered food 
        item shall not affect the amount of payments made under this 
        section to a school for the meal.''.
    (b) Removing Mandatory Notice to Institutions.--Section 13(n)(2) of 
the Act is amended by striking ``and its plans and schedule'' and 
inserting ``except that the Secretary may not require a State to submit 
a plan or schedule''.

SEC. 423. CHILD AND ADULT CARE FOOD PROGRAM.

    (a) Payments to Sponsor Employees.--Paragraph (2) of the last 
sentence of section 17(a) of the National School Lunch Act (42 U.S.C. 
1766(a)) is amended--
            (1) by striking ``and'' at the end of subparagraph (B);
            (2) by striking the period at the end of subparagraph (C) 
        and inserting ``; and''; and
            (3) by adding at the end the following:
                    ``(D) in the case of a family or group day care 
                home sponsoring organization that employs more than 1 
                employee, the organization does not base payments to an 
                employee of the organization on the number of family or 
                group day care homes recruited, managed, or 
                monitored.''.
    (b) Improved Targeting of Day Care Home Reimbursements.--
            (1) Restructured day care home reimbursements.--Section 
        17(f)(3) of the Act is amended by striking ``(3)(A) 
        Institutions'' and all that follows through the end of 
        subparagraph (A) and inserting the following:
            ``(3) Reimbursement of family or group day care home 
        sponsoring organizations.--
                    ``(A) Reimbursement factor.--
                            ``(i) In general.--An institution that 
                        participates in the program under this section 
                        as a family or group day care home sponsoring 
                        organization shall be provided, for payment to 
                        a home sponsored by the organization, 
                        reimbursement factors in accordance with this 
                        subparagraph for the cost of obtaining and 
                        preparing food and prescribed labor costs 
                        involved in providing meals under this section.
                            ``(ii) Tier i family or group day care 
                        homes.--
                                    ``(I) Definition.--In this 
                                paragraph, the term `tier I family or 
                                group day care home' means--
                                            ``(aa) a family or group 
                                        day care home that is located 
                                        in a geographic area, as 
                                        defined by the Secretary based 
                                        on census data, in which at 
                                        least 50 percent of the 
                                        children residing in the area 
                                        are members of households whose 
                                        incomes meet the income 
                                        eligibility guidelines for free 
                                        or reduced price meals under 
                                        section 9;
                                            ``(bb) a family or group 
                                        day care home that is located 
                                        in an area served by a school 
                                        enrolling elementary students 
                                        in which at least 50 percent of 
                                        the total number of children 
                                        enrolled are certified eligible 
                                        to receive free or reduced 
                                        price school meals under this 
                                        Act or the Child Nutrition Act 
                                        of 1966 (42 U.S.C. 1771 et 
                                        seq.); or
                                            ``(cc) a family or group 
                                        day care home that is operated 
                                        by a provider whose household 
                                        meets the income eligibility 
                                        guidelines for free or reduced 
                                        price meals under section 9 and 
                                        whose income is verified by the 
                                        sponsoring organization of the 
                                        home under regulations 
                                        established by the Secretary.
                                    ``(II) Reimbursement.--Except as 
                                provided in subclause (III), a tier I 
                                family or group day care home shall be 
                                provided reimbursement factors
                                 under this clause without a 
requirement for documentation of the costs described in clause (i), 
except that reimbursement shall not be provided under this subclause 
for meals or supplements served to the children of a person acting as a 
family or group day care home provider unless the children meet the 
income eligibility guidelines for free or reduced price meals under 
section 9.
                                    ``(III) Factors.--Except as 
                                provided in subclause (IV), the 
                                reimbursement factors applied to a home 
                                referred to in subclause (II) shall be 
                                the factors in effect on the date of 
                                enactment of this subclause.
                                    ``(IV) Adjustments.--The 
                                reimbursement factors under this 
                                subparagraph shall be adjusted on 
                                August 1, 1996, July 1, 1997, and each 
                                July 1 thereafter, to reflect changes 
                                in the Consumer Price Index for food at 
                                home for the most recent 12-month 
                                period for which the data are 
                                available. The reimbursement factors 
                                under this subparagraph shall be 
                                rounded to the nearest lower cent 
                                increment and based on the unrounded 
                                adjustment in effect on June 30 of the 
                                preceding school year.
                            ``(iii) Tier ii family or group day care 
                        homes.--
                                    ``(I) In general.--
                                            ``(aa) Factors.--Except as 
                                        provided in subclause (II), 
                                        with respect to meals or 
                                        supplements served under this 
                                        clause by a family or group day 
                                        care home that does not meet 
                                        the criteria set forth in 
                                        clause (ii)(I), the 
                                        reimbursement factors shall be 
                                        $1 for lunches and suppers, 30 
                                        cents for breakfasts, and 15 
                                        cents for supplements.
                                            ``(bb) Adjustments.--The 
                                        factors shall be adjusted on 
                                        July 1, 1997, and each July 1 
                                        thereafter, to reflect changes 
                                        in the Consumer Price Index for 
                                        food at home for the most 
                                        recent 12-month period for 
                                        which the data are available. 
                                        The reimbursement factors under 
                                        this item shall be rounded down 
                                        to the nearest lower cent 
                                        increment and based on the 
                                        unrounded adjustment for the 
                                        preceding 12-month period.
                                            ``(cc) Reimbursement.--A 
                                        family or group day care home 
                                        shall be provided reimbursement 
                                        factors under this subclause 
                                        without a requirement for 
                                        documentation of the costs 
                                        described in clause (i), except 
                                        that reimbursement shall not be 
                                        provided under this subclause 
                                        for meals or supplements served 
                                        to the children of a person 
                                        acting as a family or group day 
                                        care home provider unless the 
                                        children meet the income 
                                        eligibility guidelines for free 
                                        or reduced price meals under 
                                        section 9.
                                    ``(II) Other factors.--A family or 
                                group day care home that does not meet 
                                the criteria set forth in clause 
                                (ii)(I) may elect to be provided 
                                reimbursement factors determined in 
                                accordance with the following 
                                requirements:
                                            ``(aa) Children eligible 
                                        for free or reduced price 
                                        meals.--In the case of meals or 
                                        supplements served under this 
                                        subsection to children who are 
                                        members of households whose 
                                        incomes meet the income 
                                        eligibility guidelines for free 
                                        or reduced price meals under 
                                        section 9, the family or group 
                                        day care home shall be provided 
                                        reimbursement factors set by 
                                        the Secretary in accordance 
                                        with clause (ii)(III).
                                            ``(bb) Ineligible 
                                        children.--In the case of meals 
                                        or supplements served under 
                                        this subsection to children who 
                                        are members of households whose 
                                        incomes do not meet the income 
                                        eligibility guidelines, the 
                                        family or group day care home 
                                        shall be provided reimbursement 
                                        factors in accordance with 
                                        subclause (I).
                                    ``(III) Information and 
                                determinations.--
                                            ``(aa) In general.--If a 
                                        family or group day care home 
                                        elects to claim the factors 
                                        described in subclause (II), 
                                        the family or group day care 
                                        home sponsoring organization 
                                        serving the home shall collect 
                                        the necessary income 
                                        information, as determined by 
                                        the Secretary, from any parent 
                                        or other caretaker to make the 
                                        determinations specified in 
                                        subclause (II) and shall make 
                                        the determinations in 
                                        accordance with rules 
                                        prescribed by the Secretary.
                                            ``(bb) Categorical 
                                        eligibility.--In making a 
                                        determination under item (aa), 
                                        a family or
                                         group day care home sponsoring 
organization may consider a child participating in or subsidized under, 
or a child with a parent participating in or subsidized under, a 
federally or State supported child care or other benefit program with 
an income eligibility limit that does not exceed the eligibility 
standard for free or reduced price meals under section 9 to be a child 
who is a member of a household whose income meets the income 
eligibility guidelines under section 9.
                                            ``(cc) Factors for children 
                                        only.--A family or group day 
                                        care home may elect to receive 
                                        the reimbursement factors 
                                        prescribed under clause 
                                        (ii)(III) solely for the 
                                        children participating in a 
                                        program referred to in item 
                                        (bb) if the home elects not to 
                                        have income statements 
                                        collected from parents or other 
                                        caretakers.
                                    ``(IV) Simplified meal counting and 
                                reporting procedures.--The Secretary 
                                shall prescribe simplified meal 
                                counting and reporting procedures for 
                                use by a family or group day care home 
                                that elects to claim the factors under 
                                subclause (II) and by a family or group 
                                day care home sponsoring organization 
                                that sponsors the home. The procedures 
                                the Secretary prescribes may include 1 
                                or more of the following:
                                            ``(aa) Setting an annual 
                                        percentage for each home of the 
                                        number of meals served that are 
                                        to be reimbursed in accordance 
                                        with the reimbursement factors 
                                        prescribed under clause 
                                        (ii)(III) and an annual 
                                        percentage of the number of 
                                        meals served that are to be 
                                        reimbursed in accordance with 
                                        the reimbursement factors 
                                        prescribed under subclause (I), 
                                        based on the family income of 
                                        children enrolled in the home 
                                        in a specified month or other 
                                        period.
                                            ``(bb) Placing a home into 
                                        1 of 2 or more reimbursement 
                                        categories annually based on 
                                        the percentage of children in 
                                        the home whose households have 
                                        incomes that meet the income 
                                        eligibility guidelines under 
                                        section 9, with each such 
                                        reimbursement category carrying 
                                        a set of reimbursement factors 
                                        such as the factors prescribed 
                                        under clause (ii)(III) or 
                                        subclause (I) or factors 
                                        established within the range of 
                                        factors prescribed under clause 
                                        (ii)(III) and subclause (I).
                                            ``(cc) Such other 
                                        simplified procedures as the 
                                        Secretary may prescribe.
                                    ``(V) Minimum verification 
                                requirements.--The Secretary may 
                                establish any necessary minimum 
                                verification requirements.''.
            (2) Grants to states to provide assistance to family or 
        group day care homes.--Section 17(f)(3) of the Act is amended 
        by adding at the end the following:
                    ``(D) Grants to states to provide assistance to 
                family or group day care homes.--
                            ``(i) In general.--
                                    ``(I) Reservation.--From amounts 
                                made available to carry out this 
                                section, the Secretary shall reserve 
                                $5,000,000 of the amount made available 
                                for fiscal year 1996.
                                    ``(II) Purpose.--The Secretary 
                                shall use the funds made available 
                                under subclause (I) to provide grants 
                                to States for the purpose of 
                                providing--
                                            ``(aa) assistance, 
                                        including grants, to family and 
                                        day care home sponsoring 
                                        organizations and other 
                                        appropriate organizations, in 
                                        securing and providing 
                                        training, materials, automated 
                                        data processing assistance, and 
                                        other assistance for the staff 
                                        of the sponsoring 
                                        organizations; and
                                            ``(bb) training and other 
                                        assistance to family and group 
                                        day care homes in the 
                                        implementation of the 
                                        amendments to subparagraph (A) 
                                        made by section 423(b)(1) of 
                                        the Work Opportunity Act of 
                                        1995.
                            ``(ii) Allocation.--The Secretary shall 
                        allocate from the funds reserved under clause 
                        (i)(I)--
                                    ``(I) $30,000 in base funding to 
                                each State; and
                                    ``(II) any remaining amount among 
                                the States, based on the number of 
                                family day care homes participating in 
                                the program in a State during fiscal 
                                year 1994 as a percentage of the number 
                                of all family day care homes 
                                participating in the program during 
                                fiscal year 1994.
                            ``(iii) Retention of funds.--Of the amount 
                        of funds made available to a State for fiscal 
                        year 1996 under clause (i), the
                         State may retain not to exceed 30 percent of 
the amount to carry out this subparagraph.
                            ``(iv) Additional payments.--Any payments 
                        received under this subparagraph shall be in 
                        addition to payments that a State receives 
                        under subparagraph (A) (as amended by section 
                        423(b)(1) of the Work Opportunity Act of 
                        1995).''.
            (3) Provision of data.--Section 17(f)(3) of the Act (as 
        amended by paragraph (2)) is further amended by adding at the 
        end the following:
                    ``(E) Provision of data to family or group day care 
                home sponsoring organizations.--
                            ``(i) Census data.--The Secretary shall 
                        provide to each State agency administering a 
                        child and adult care food program under this 
                        section data from the most recent decennial 
                        census survey or other appropriate census 
                        survey for which the data are available showing 
                        which areas in the State meet the requirements 
                        of subparagraph (A)(ii)(I)(aa). The State 
                        agency shall provide the data to family or 
                        group day care home sponsoring organizations 
                        located in the State.
                            ``(ii) School data.--
                                    ``(I) In general.--A State agency 
                                administering the school lunch program 
                                under this Act or the school breakfast 
                                program under the Child Nutrition Act 
                                of 1966 (42 U.S.C. 1771 et seq.) shall 
                                provide data for each elementary school 
                                in the State, or shall direct each 
                                school within the State to provide data 
                                for the school, to approved family or 
                                group day care home sponsoring 
                                organizations that request the data, on 
                                the percentage of enrolled children who 
                                are eligible for free or reduced price 
                                meals.
                                    ``(II) Use of data from preceding 
                                school year.--In determining for a 
                                fiscal year or other annual period 
                                whether a home qualifies as a tier I 
                                family or group day care home under 
                                subparagraph (A)(ii)(I), the State 
                                agency administering the program under 
                                this section, and a family or group day 
                                care home sponsoring organization, 
                                shall use the most current available 
                                data at the time of the determination.
                            ``(iii) Duration of determination.--For 
                        purposes of this section, a determination that 
                        a family or group day care home is located in 
                        an area that qualifies the home as a tier I 
                        family or group day care home (as the term is 
                        defined in subparagraph (A)(ii)(I)), shall be 
                        in effect for 3 years (unless the determination 
                        is made on the basis of census data, in which 
                        case the determination shall remain in effect 
                        until more recent census data are available) 
                        unless the State agency determines that the 
                        area in which the home is located no longer 
                        qualifies the home as a tier I family or group 
                        day care home.''.
            (4) Conforming amendments.--Section 17(c) of the Act is 
        amended by inserting ``except as provided in subsection 
        (f)(3),'' after ``For purposes of this section,'' each place it 
        appears in paragraphs (1), (2), and (3).
    (c) Disallowing Meal Claims.--The fourth sentence of section 
17(f)(4) of the Act is amended by inserting ``(including institutions 
that are not family or group day care home sponsoring organizations)'' 
after ``institutions''.
    (d) Elimination of State Paperwork and Outreach Burden.--Section 17 
of the Act is amended by striking subsection (k) and inserting the 
following:
    ``(k) Training and Technical Assistance.--A State participating in 
the program established under this section shall provide sufficient 
training, technical assistance, and monitoring to facilitate effective 
operation of the program. The Secretary shall assist the State in 
developing plans to fulfill the requirements of this subsection.''.
    (e) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall become effective on the 
        date of enactment of this Act.
            (2) Improved targeting of day care home reimbursements.--
        The amendments made by paragraphs (1), (3), and (4) of 
        subsection (b) shall become effective on August 1, 1996.
SEC. 424. REDUCING REQUIRED REPORTS TO STATE AGENCIES AND SCHOOLS.

    Section 19 of the National School Lunch Act (42 U.S.C. 1769a) is 
amended by striking subsection (c) and inserting the following:
    ``(c) Report.--Not later than 1 year after the date of enactment of 
the Work Opportunity Act of 1995, the Secretary shall--
            ``(1) review all reporting requirements under this Act and 
        the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.) that 
        are in effect, as of the date of enactment of the Work 
        Opportunity Act of 1995, for agencies and schools referred to 
        in subsection (a); and
            ``(2) provide a report to the Committee on Economic and 
        Educational Opportunities of the House of Representatives and 
        the Committee on Agriculture, Nutrition, and Forestry of the 
        Senate that--
                    ``(A) describes the reporting requirements 
                described in paragraph (1) that are required by law;
                    ``(B) makes recommendations concerning the 
                elimination of any requirement described in 
                subparagraph (A) because the contribution of the 
                requirement to program effectiveness is not sufficient 
                to warrant the paperwork burden that is placed on 
                agencies and schools referred to in subsection (a); and
                    ``(C) provides a justification for reporting 
                requirements described in paragraph (1) that are 
                required solely by regulation.''.

                      Subtitle D--Reauthorization

SEC. 431. COMMODITY DISTRIBUTION PROGRAM; COMMODITY SUPPLEMENTAL FOOD 
              PROGRAM.

    (a) Reauthorization.--The first sentence of section 4(a) of the 
Agriculture and Consumer Protection Act of 1973 (Public Law 93-86; 7 
U.S.C. 612c note) is amended by striking ``1995'' and inserting 
``2002''.
    (b) Administrative Funding.--Section 5(a)(2) of the Act (Public Law 
93-86; 7 U.S.C. 612c note) is amended by striking ``1995'' and 
inserting ``2002''.

SEC. 432. EMERGENCY FOOD ASSISTANCE PROGRAM.

    (a) Reauthorization.--The first sentence of section 204(a)(1) of 
the Emergency Food Assistance Act of 1983 (Public Law 98-8; 7 U.S.C. 
612c note) is amended by striking ``1995'' and inserting ``2002''.
    (b) Program Termination.--Section 212 of the Act (Public Law 98-8; 
7 U.S.C. 612c note) is amended by striking ``1995'' and inserting 
``2002''.
    (c) Required Purchases of Commodities.--Section 214 of the Act 
(Public Law 98-8; 7 U.S.C. 612c note) is amended--
            (1) in the first sentence of subsection (a), by striking 
        ``1995'' and inserting ``2002''; and
            (2) in subsection (e), by striking ``1995'' each place it 
        appears and inserting ``2002''.
    (d) Extension.--Section 13962 of the Omnibus Budget Reconciliation 
Act of 1993 (Public Law 103-66; 107 Stat. 680) is amended by striking 
``1994, 1995, and 1996'' each place it appears and inserting ``1994 
through 2002''.

SEC. 433. SOUP KITCHENS PROGRAM.

    Section 110 of the Hunger Prevention Act of 1988 (Public Law 100-
435; 7 U.S.C. 612c note) is amended--
            (1) in the first sentence of subsection (a), by striking 
        ``1995'' and inserting ``2002''; and
            (2) in subsection (c)(2)--
                    (A) in the paragraph heading, by striking ``1995'' 
                and inserting ``2002''; and
                    (B) by striking ``1995'' each place it appears and 
                inserting ``2002''.

SEC. 434. NATIONAL COMMODITY PROCESSING.

    The first sentence of section 1114(a)(2)(A) of the Agriculture and 
Food Act of 1981 (7 U.S.C. 1431e(2)(A)) is amended by striking ``1995'' 
and inserting ``2002''.

SEC. 435. COMMODITY SUPPLEMENTAL FOOD PROGRAM.

            Section 5(d)(2) of the Agriculture and Consumer Protection 
        Act of 1973 (Public Law 93-86; 7 U.S.C. 612c note) is amended 
        by striking ``1995'' and inserting ``2002''.
                          TITLE V--NONCITIZENS

SEC. 501. STATE OPTION TO PROHIBIT ASSISTANCE FOR CERTAIN ALIENS.

    A State may, at its option, prohibit the use of any grant funds 
received under part A of title IV of the Social Security Act or section 
25 of the Food Stamp Act of 1977 for the provision of assistance under 
the State programs funded under such part or section for an individual 
who is not a citizen or national of the United States.

SEC. 502. DEEMED INCOME REQUIREMENT FOR FEDERAL AND FEDERALLY FUNDED 
              PROGRAMS.

    (a) Deeming Requirement for Federal and Federally Funded 
Programs.--For purposes of determining the eligibility of an individual 
(whether a citizen or national of the United States or an alien) for 
assistance, and the amount of assistance, under any Federal program of 
assistance provided or funded, in whole or in part, by the Federal 
Government for which eligibility for benefits is based on need, the 
income and resources described in subsection (b) shall, notwithstanding 
any other provision of law, be deemed to be the income and resources of 
such individual.
    (b) Deemed Income and Resources.--The income and resources 
described in this subsection include the following:
            (1) The income and resources of any person who, as a 
        sponsor of such individual's entry into the United States (or 
        in order to enable such individual lawfully to remain in the 
        United States), executed an affidavit of support or similar 
        agreement with respect to such individual.
            (2) The income and resources of such sponsor's spouse.
    (c) Length of Deemed Income Period.--The requirement of subsection 
(a) shall apply for the period for which the sponsor has agreed, in 
such affidavit or agreement, to provide support for such individual, or 
for a period of 5 years beginning on the date such individual was first 
lawfully in the United States after the execution of such affidavit or 
agreement, whichever period is longer.
    (d) Deemed Income Authority to State and Local Agencies.--
            (1) In general.--For purposes of determining the 
        eligibility of an individual (whether a citizen or national of 
        the United States or an alien) for assistance, and the amount 
        of assistance, under any State or local program of assistance 
        authorized under Federal law for which eligibility is based on 
        need, or any need-based program of assistance authorized under 
        Federal law and administered by a State or local government 
        other than a program described in subsection (a), the State or 
        local government may, notwithstanding any other provision of 
        law, require that the income and resources described in 
        subsection (b) be deemed to be the income and resources of such 
        individual.
            (2) Length of deeming period.--A State or local government 
        may impose a requirement described in paragraph (1) for the 
        period described in subsection (c).
    (e) Applicability of section.--
            (1) Individuals.--The provisions of this section shall not 
        apply to the eligibility of any individual who is described in 
        subclause (II), (III), (IV), or (V) of section 1614(a)(1)(B)(i) 
        of the Social Security Act (42 U.S.C. 1382c(a)(1)(B)(i)).
            (2) Programs.--The provisions of this section shall not 
        apply to eligibility for--
                    (A) emergency medical services under title XIX of 
                the Social Security Act (42 U.S.C. 1396 et seq.);
                    (B) short-term emergency disaster relief;
                    (C) assistance or benefits under the National 
                School Lunch Act;
                    (D) assistance or benefits under the Child 
                Nutrition Act of 1966; and
                    (E) public health assistance for immunizations with 
                respect to immunizable diseases and for testing and 
                treatment for communicable diseases if the Secretary of 
                Health and Human Services determines that such testing 
                and treatment is necessary.
    (f) Conforming Amendments.--
            (1) Section 1621 of the Social Security Act (42 U.S.C. 
        1382j) is repealed.
            (2) Section 1614(f)(3) of such Act (42 U.S.C. 1382c(f)(3)) 
        is amended by striking ``section 1621'' and inserting ``section 
        502 of the Work Opportunity Act of 1995''.
SEC. 503. LIMITED ELIGIBILITY OF NONCITIZENS FOR SSI BENEFITS.

    (a) In General.--Paragraph (1) of section 1614(a) of the Social 
Security Act (42 U.S.C. 1382c(a)) is amended--
            (1) in subparagraph (B)(i), by striking ``either'' and all 
        that follows through ``, or'' and inserting ``(I) a citizen; 
        (II) a noncitizen who is granted asylum under section 208 of 
        the Immigration and Nationality Act or whose deportation has 
        been withheld
         under section 243(h) of such Act for a period of not more than 
5 years after the date of arrival into the United States; (III) a 
noncitizen who is admitted to the United States as a refugee under 
section 207 of such Act for not more than such 5-year period; (IV) a 
noncitizen, lawfully present in any State (or any territory or 
possession of the United States), who is a veteran (as defined in 
section 101 of title 38, United States Code) with a discharge 
characterized as an honorable discharge and not on account of alienage 
or who is the spouse or unmarried dependent child of such veteran; or 
(V) a noncitizen who has worked sufficient calendar quarters of 
coverage to be a fully insured individual for benefits under title II, 
or''; and
            (2) by adding at the end the following new flush sentence:
``For purposes of subparagraph (B)(i)(IV), the determination of whether 
a noncitizen is lawfully present in the United States shall be made in 
accordance with regulations of the Attorney General. A noncitizen shall 
not be considered to be lawfully present in the United States for 
purposes of this title merely because the noncitizen may be considered 
to be permanently residing in the United States under color of law for 
purposes of any particular program.''.
    (b) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by subsection (a) shall apply to applicants for 
        benefits for months beginning on or after the date of the 
        enactment of this Act, without regard to whether regulations 
        have been issued to implement such amendments.
            (2) Application to current recipients.--
                    (A) Application and notice.--Notwithstanding any 
                other provision of law, in the case of an individual 
                who is receiving supplemental security income benefits 
                under title XVI of the Social Security Act as of the 
                date of the enactment of this Act and whose eligibility 
                for such benefits would terminate by reason of the 
                amendments made by subsection (a), such amendments 
                shall apply with respect to the benefits of such 
                individual for months beginning on or after January 1, 
                1997, and the Commissioner of Social Security shall so 
                notify the individual not later than 90 days after the 
                date of the enactment of this Act.
                    (B) Reapplication.--
                            (i) In general.--Not later than 120 days 
                        after the date of the enactment of this Act, 
                        each individual notified pursuant to 
                        subparagraph (A) who desires to reapply for 
                        benefits under title XVI of the Social Security 
                        Act shall reapply to the Commissioner of Social 
                        Security.
                            (ii) Determination of eligibility.--Not 
                        later than 1 year after the date of the 
                        enactment of this Act, the Commissioner of 
                        Social Security shall determine the eligibility 
                        of each individual who reapplies for benefits 
                        under clause (i) pursuant to the procedures of 
                        such title XVI.
                          TITLE VI--CHILD CARE

SEC. 601. SHORT TITLE.

    This title may be cited as the ``Child Care and Development Block 
Grant Amendments Act of 1995''.

SEC. 602. AMENDMENTS TO THE CHILD CARE AND DEVELOPMENT BLOCK GRANT ACT 
              OF 1990.

    (a) Authorization of Appropriations.--Section 658B of the Child 
Care and Development Block Grant Act of 1990 (42 U.S.C. 9858) is 
amended to read as follows:

``SEC. 658B. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated to carry out this 
subchapter $1,000,000,000 for fiscal year 1996, and such sums as may be 
necessary for each of the fiscal years 1997 through 2000.''.
    (b) Lead Agency.--Section 658D(b) of the Child Care and Development 
Block Grant Act of 1990 (42 U.S.C. 9858b(b)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A), by striking ``State'' and 
                inserting ``governmental or nongovernmental''; and
                    (B) in subparagraph (C), by inserting ``with 
                sufficient time and Statewide distribution of the 
                notice of such hearing,'' after ``hearing in the 
                State''; and
            (2) in paragraph (2), by striking the second sentence.
    (c) Application and Plan.--Section 658E of the Child Care and 
Development Block Grant Act of 1990 (42 U.S.C. 9858c) is amended--
            (1) in subsection (b), by striking ``implemented--'' and 
        all that follows through ``plans.'' and inserting ``implemented 
        during a 2-year period.'';
            (2) in subsection (c)--
                    (A) in paragraph (2)--
                            (i) in subparagraph (A)--
                                    (I) in clause (iii) by striking the 
                                semicolon and inserting a period; and
                                    (II) by striking ``except'' and all 
                                that follows through ``1992.''; and
                            (ii) in subparagraph (E)--
                                    (I) by striking clause (ii) and 
                                inserting the following new clause:
                            ``(ii) the State will implement mechanisms 
                        to ensure that appropriate payment mechanisms 
                        exist so that proper payments under this 
                        subchapter will be made to providers within the 
                        State and to permit the State to furnish 
                        information to such providers.''; and
                                    (II) by adding at the end thereof 
                                the following new sentence: ``In lieu 
                                of any licensing and regulatory 
                                requirements applicable under State and 
                                local law, the Secretary, in 
                                consultation with Indian tribes and 
                                tribal organizations, shall develop 
                                minimum child care standards (that 
                                appropriately reflect tribal needs and 
                                available resources) that shall be 
                                applicable to Indian tribes and tribal 
                                organization receiving assistance under 
                                this subchapter.''; and
                            (iii) by striking subparagraphs (H) and 
                        (I); and
                    (B) in paragraph (3)--
                            (i) in subparagraph (C)--
                                    (I) in the subparagraph heading, by 
                                striking ``and to increase'' and all 
                                that follows through ``care services'';
                                    (II) by striking ``25 percent'' and 
                                inserting ``15 percent''; and
                                    (III) by striking ``and to provide 
                                before-'' and all that follows through 
                                ``658H)''; and
                            (ii) by adding at the end thereof the 
                        following new subparagraph:
                    ``(D) Limitation on administrative costs.--Not more 
                than 5 percent of the aggregate amount of payments 
                received under this subchapter by a State in each 
                fiscal year may be expended for administrative costs 
                incurred by such State to carry out all its functions 
                and duties under this subchapter.''.
    (d) Sliding Fee Scale.--
            (1) In general.--Section 658E(c)(5) of the Child Care and 
        Development Block Grant Act of 1990 (42 U.S.C. 9858c(c)(5)) is 
        amended by inserting before the period the following: ``and 
        that ensures a representative distribution of funding among the 
        working poor and recipients of Federal welfare assistance''.
            (2) Eligibility.--Section 658P(4)(B) of the Child Care and 
        Development Block Grant Act of 1990 (42 U.S.C. 9858n(4)(B)) is 
        amended by striking ``75 percent'' and inserting ``100 
        percent''.
    (e) Quality.--Section 658G of the Child Care and Development Block 
Grant Act of 1990 (42 U.S.C. 9858e) is amended--
            (1) in the matter preceding paragraph (1)--
                    (A) by striking ``A State'' and inserting ``(a) In 
                General.--A State'';
                    (B) by striking ``not less than 20 percent of''; 
                and
                    (C) by striking ``one or more of the following'' 
                and inserting ``carrying out the resource and referral 
                activities described in subsection (b), and for one or 
                more of the activities described in subsection (c).'';
            (2) in paragraph (1), by inserting before the period the 
        following: ``, including providing comprehensive consumer 
        education to parents and the public, referrals that honor 
        parental choice, and activities designed to improve the quality 
        and availability of child care'';
            (3) by striking ``(1) Resource and Referral Programs.--
        Operating'' and inserting the following:
    ``(b) Resource and Referral Programs.--The activities described in 
this subsection are operating'';
            (4) by redesignating paragraphs (2) through (5) as 
        paragraphs (1) through (4), respectively;
            (5) by inserting before paragraph (1) (as so redesignated) 
        the following:
    ``(c) Other Activities.--The activities described in this section 
are the following:''; and
            (6) by adding at the end thereof the following:
            ``(5) Before- and after-school activities.--Increasing the 
        availability of before- and after-school care.
            ``(6) Infant care.--Increasing the availability of child 
        care for infants under the age of 18 months.
            ``(7) Nontraditional work hours.--Increasing the 
        availability of child care between the hours of 5:00 p.m. and 
        8:00 a.m.
    ``(d) Nondiscrimination.--With respect to child care providers that 
comply with applicable State law but which are otherwise not required 
to be licensed by the State, the State, in carrying out this section, 
may not discriminate against such a provider if such provider desires 
to participate in resource and referral activities carried out under 
subsection (b).''.
    (f) Repeal.--Section 658H of the Child Care and Development Block 
Grant Act of 1990 (42 U.S.C. 9858f) is repealed.
    (g) Enforcement.--Section 658I(b)(2) of the Child Care and 
Development Block Grant Act of 1990 (42 U.S.C. 9858g(b)(2)) is 
amended--
            (1) in the matter following clause (ii) of subparagraph 
        (A), by striking ``finding and that'' and all that follows 
        through the period and inserting ``finding and may impose 
        additional program requirements on the State, including a 
        requirement that the State reimburse the Secretary for any 
        funds that were improperly expended for purposes prohibited or 
        not authorized by this subchapter, that the Secretary deduct 
        from the administrative portion of the State allotment for the 
        following fiscal year an amount that is less than or equal to 
        any improperly expended funds, or a combination of such 
        options.''; and
            (2) by striking subparagraphs (B) and (C).
    (h) Reports.--Section 658K of the Child Care and Development Block 
Grant Act of 1990 (42 U.S.C. 9858i) is amended--
            (1) in the section heading, by striking ``ANNUAL REPORT'' 
        and inserting ``REPORTS''; and
            (2) in subsection (a)--
                    (A) in the subsection heading, by striking ``Annual 
                Report'' and inserting ``Reports'';
                    (B) by striking ``December 31, 1992, and annually 
                thereafter'' and inserting ``December 31, 1996, and 
                every 2 years thereafter'';
                    (C) in paragraph (2)--
                            (i) in subparagraph (A), by inserting 
                        before the semicolon ``and the types of child 
                        care programs under which such assistance is 
                        provided'';
                            (ii) by striking subparagraph (B); and
                            (iii) by redesignating subparagraphs (C) 
                        and (D) as subparagraphs (B) and (C), 
                        respectively;
                    (D) by striking paragraph (4);
                    (E) by redesignating paragraphs (5) and (6) as 
                paragraphs (4) and (5), respectively;
                    (F) in paragraph (4), as so redesignated, by 
                striking ``and'' at the end thereof;
                    (G) in paragraph (5), as so redesignated, by adding 
                ``and'' at the end thereof; and
                    (H) by inserting after paragraph (5), as so 
                redesignated, the following new paragraph:
            ``(6) describing the extent and manner to which the 
        resource and referral activities are being carried out by the 
        State;''.
    (i) Report by Secretary.--Section 658L of the Child Care and 
Development Block Grant Act of 1990 (42 U.S.C. 9858j) is amended--
            (1) by striking ``1993'' and inserting ``1997'';
            (2) by striking ``annually'' and inserting ``bi-annually''; 
        and
            (3) by striking ``Education and Labor'' and inserting 
        ``Economic and Educational Opportunities''.
    (j) Allotments.--Section 658O of the Child Care and Development 
Block Grant Act of 1990 (42 U.S.C. 9858m) is amended--
            (1) in subsection (c), by adding at the end thereof the 
        following new paragraph:
            ``(6) Construction or Renovation of Facilities.--
                    ``(A) Request for use of funds.--An Indian tribe or 
                tribal organization may submit to the Secretary a 
                request to use amounts provided under this subsection 
                for construction or renovation purposes.
                    ``(B) Determination.--With respect to a request 
                submitted under subparagraph (A), and except as 
                provided in subparagraph (C), upon a determination by 
                the Secretary that adequate facilities are not 
                otherwise available to an Indian tribe or tribal 
                organization to enable such tribe or organization to 
                carry out child care programs in accordance with this 
                subchapter, and that the lack of such facilities will 
                inhibit the operation of such programs in the future, 
                the Secretary may permit the tribe or organization to 
                use assistance provided under this subsection to make 
                payments for the construction or renovation of 
                facilities that will be used to carry out such 
                programs.
                    ``(C) Limitation.--The Secretary may not permit an 
                Indian tribe or tribal organization to use amounts 
                provided under this subsection for construction or 
                renovation if such use will result in a decrease in the 
                level of child care services provided by the tribe or 
                organization as compared to the level of such services 
                provided by the tribe or organization in the fiscal 
                year preceding the year for which the determination 
                under subparagraph (A) is being made.
                    ``(D) Uniform procedures.--The Secretary shall 
                develop and implement uniform procedures for the 
                solicitation and consideration of requests under this 
                paragraph.''; and
            (2) in subsection (e)--
                    (A) in paragraph (1), by striking ``Any'' and 
                inserting ``Except as provided in paragraph (4), any''; 
                and
                    (B) by adding at the end thereof the following new 
                paragraph:
            ``(4) Indian tribes or tribal organizations.--Any portion 
        of a grant or contract made to an Indian tribe or tribal 
        organization under subsection (c) that the Secretary determines 
        is not being used in a manner consistent with the provision of 
        this subchapter in the period for with the grant or contract is 
        made available, shall be reallocated by the Secretary to other 
        tribes or organization that have submitted applications under 
        subsection (c) in proportion to the original allocations to 
        such tribes or organization.''.
    (k) Definitions.--Section 658P of the Child Care and Development 
Block Grant Act of 1990 (42 U.S.C. 9858n) is amended--
            (1) in paragraph (2), in the first sentence by inserting 
        ``or as a deposit for child care services if such a deposit is 
        required of other children being cared for by the provider'' 
        after ``child care services''; and
            (2) in paragraph (5)(B)--
                    (A) by inserting ``great grandchild, sibling (if 
                the provider lives in a separate residence),'' after 
                ``grandchild,'';
                    (B) by striking ``is registered and''; and
                    (C) by striking ``State'' and inserting 
                ``applicable''.
    (l) Authority to Transfer Funds.--The Child Care and Development 
Block Grant Act of 1990 (42 U.S.C. 9858 et seq.) is amended by 
inserting after section 658S the following new section:

``SEC. 658T. TRANSFER OF FUNDS.

    ``(a) Authority.--Of the aggregate amount of payments received 
under this subchapter by a State in each fiscal year, the State may 
transfer not more than 30 percent for use by the State to carry out the 
State program funded under part A of title IV of the Social Security 
Act (42 U.S.C. 601 et seq.).
    ``(b) Requirements Applicable to Funds Transferred.--Funds 
transferred under subsection (a) to carry out the State program 
specified in such subsection shall not be subject to the requirements 
of this subchapter, but shall be subject to the same requirements that 
apply to Federal funds provided directly under such program.''.

SEC. 603. REPEALS AND TECHNICAL AND CONFORMING AMENDMENTS.

    (a) State Dependent Care Development Grants Act.--The State 
Dependent Care Development Grants Act (42 U.S.C. 9871 et seq.) is 
repealed.
    (b) Child Development Associate Scholarship Assistance Act of 
1985.--The Child Development Associate Scholarship Assistance Act of 
1985 (42 U.S.C. 10901 et seq.) is repealed.
    (c) Additional Conforming Amendments.--
            (1) Recommended legislation.--After consultation with the 
        appropriate committees of the Congress and the Director of the 
        Office of Management and Budget, the Secretary of Health and 
        Human Services shall prepare and submit to the Congress a 
        legislative proposal in the form of an implementing bill 
        containing technical and conforming amendments to reflect the 
        amendments and repeals made by this title.
            (2) Submission to congress.--Not later than 6 months after 
        the date of enactment of this title, the Secretary of Health 
        and Human Services shall submit the implementing bill referred 
        to under paragraph (1).
 TITLE VII--WORKFORCE DEVELOPMENT AND WORKFORCE PREPARATION ACTIVITIES

                     Subtitle A--General Provisions

SEC. 701. SHORT TITLE.

    This title may be cited as the ``Workforce Development Act of 
1995''.
SEC. 702. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) increasing international competition, technological 
        advances, and structural changes in the United States economy 
        present new challenges to private businesses and public 
        policymakers in creating a skilled workforce with the ability 
        to adapt to change and technological progress;
            (2) despite more than 60 years of federally funded 
        employment training programs, the Federal Government has no 
        single, coherent policy guiding employment training efforts;
            (3) according to the General Accounting Office, there are 
        over 100 federally funded employment training programs, which 
        are administered by 15 different Federal agencies and cost more 
        than $20,000,000,000 annually;
            (4) many of the programs fail to collect enough performance 
        data to determine the relative effectiveness of each of the 
        programs or the effectiveness of the programs as a whole;
            (5) because of the fragmentation, duplication, and lack of 
        accountability that currently exist within and among Federal 
        employment training programs it is often difficult for workers, 
        jobseekers, and businesses to easily access the services they 
        need;
            (6) high quality, innovative vocational education programs 
        provide youth with skills and knowledge on which to build 
        successful careers and, in providing the skills and knowledge, 
        vocational education serves as the foundation of a successful 
        workforce development system;
            (7) in recent years, several States and communities have 
        begun to develop promising new initiatives such as--
                    (A) school-to-work programs to better integrate 
                youth employment and education programs; and
                    (B) one-stop systems to make workforce development 
                activities more accessible to workers, jobseekers, and 
                businesses; and
            (8) Federal, State, and local governments have failed to 
        adequately allow for private sector leadership in designing 
        workforce development activities that are responsive to local 
        labor market needs.
    (b) Purposes.--The purposes of this title are--
            (1) to make the United States more competitive in the world 
        economy by eliminating the fragmentation in Federal employment 
        training efforts and creating coherent, integrated statewide 
        workforce development systems designed to develop more fully 
        the academic, occupational, and literacy skills of all segments 
        of the workforce;
            (2) to ensure that all segments of the workforce will 
        obtain the skills necessary to earn wages sufficient to 
        maintain the highest quality of living in the world; and
            (3) to promote the economic development of each State by 
        developing a skilled workforce that is responsive to the labor 
        market needs of the businesses of each State.
SEC. 703. DEFINITIONS.

    As used in this title and title VIII:
            (1) Adult education.--
                    (A) In general.--The term ``adult education'' means 
                services or instruction below the college level for 
                adults who--
                            (i) lack sufficient education or literacy 
                        skills to enable the adults to function 
                        effectively in society; or
                            (ii) do not have a certificate of 
                        graduation from a school providing secondary 
                        education (as determined under State law) and 
                        who have not achieved an equivalent level of 
                        education.
                    (B) Adult.--As used in subparagraph (A), the term 
                ``adult'' means an individual who is age 16 or older, 
                or beyond the age of compulsory school attendance under 
                State law, and who is not enrolled in secondary school.
            (2) Area vocational education school.--The term ``area 
        vocational education school'' means--
                    (A) a specialized secondary school used exclusively 
                or principally for the provision of vocational 
                education to individuals who are available for study in 
                preparation for entering the labor market;
                    (B) the department of a secondary school 
                exclusively or principally used for providing 
                vocational education in not fewer than 5 different 
                occupational fields to individuals who are available 
                for study in preparation for entering the labor market;
                    (C) a technical institute or vocational school used 
                exclusively or principally for the provision of 
                vocational education to individuals who have completed 
                or left secondary school and who are available for 
                study in preparation for entering the labor market, if 
                the institute or school admits as regular students both 
                individuals who have completed secondary school and 
                individuals who have left secondary school; or
                    (D) the department or division of a junior college, 
                community college, or university that provides 
                vocational education in not fewer than 5 different 
                occupational fields leading to immediate employment but 
                not necessarily leading to a baccalaureate degree, if 
                the department or division admits as regular students 
                both individuals who have completed secondary school 
                and individuals who have left secondary school.
            (3) At-risk youth.--The term ``at-risk youth'' means an 
        individual who--
                    (A) is not less than age 15 and not more than age 
                24; and
                    (B)(i) is determined under guidelines developed by 
                the Governing Board to be low-income, using the most 
                recent available data provided by the Bureau of the 
                Census, prior to the determination; or
                    (ii) is a dependent of a family that is determined 
                under guidelines developed by the Governing Board to be 
                low-income, using such data.
            (4) Chief elected official.--The term ``chief elected 
        official'' means the chief elected officer of a unit of general 
        local government in a substate area.
            (5) Community-based organization.--The term ``community-
        based organization'' means a private nonprofit organization of 
        demonstrated effectiveness that is representative of a 
        community or a significant segment of a community and that 
        provides workforce development activities.
            (6) Covered activity.--The term ``covered activity'' means 
        an activity authorized to be carried out under a provision 
        described in section 781(b) (as such provision was in effect on 
        the day before the date of enactment of this Act).
            (7) Dislocated worker.--The term ``dislocated worker'' 
        means an individual who--
                    (A) has been terminated from employment and is 
                eligible for unemployment compensation;
                    (B) has received a notice of termination of 
                employment as a result of any permanent closure, or any 
                layoff of 50 or more people, at a plant, facility, or 
                enterprise;
                    (C) is long-term unemployed;
                    (D) was self-employed (including a farmer and a 
                rancher) but is unemployed due to local economic 
                conditions;
                    (E) is a displaced homemaker; or
                    (F) has become unemployed as a result of a Federal 
                action that limits the use of, or restricts access to, 
                a marine natural resource.
            (8) Displaced homemaker.--The term ``displaced homemaker'' 
        means an individual who was a full-time homemaker for a 
        substantial number of years, as determined under guidelines 
        developed by the Governing Board, and who no longer receives 
        financial support previously provided by a spouse or by public 
        assistance.
            (9) Economic development activities.--The term ``economic 
        development activities'' means the activities described in 
        section 716(e).
            (10) Educational service agency.--The term ``educational 
        service agency'' means a regional public multiservice agency 
        authorized by State statute to develop and manage a service or 
        program, and provide the service or program to a local 
        educational agency.
            (11) Elementary school; local educational agency; secondary 
        school.--The terms ``elementary school'', ``local educational 
        agency'' and ``secondary school'' have the meanings given the 
        terms in section 14101 of the Elementary and Secondary 
        Education Act of 1965 (20 U.S.C. 8801).
            (12) Federal partnership.--The term ``Federal Partnership'' 
        means the Workforce Development Partnership established in 
        section 771.
            (13) Flexible workforce activities.--The term ``flexible 
        workforce activities'' means the activities described in 
        section 716(d).
            (14) Governing board.--The term ``Governing Board'' means 
        the Governing Board of the Federal Partnership.
            (15) Individual with a disability.--
                    (A) In general.--The term ``individual with a 
                disability'' means an individual with any disability 
                (as defined in section 3 of the Americans with 
                Disabilities Act of 1990 (42 U.S.C. 12102)).
                    (B) Individuals with disabilities.--The term 
                ``individuals with disabilities'' means more than 1 
                individual with a disability.
            (16) Local entity.--The term ``local entity'' means a 
        public or private entity responsible for local workforce 
        development activities or workforce preparation activities for 
        at-risk youth.
            (17) Local partnership.--The term ``local partnership'' 
        means a partnership referred to in section 728(a).
            (18) Older worker.--The term ``older worker'' means an 
        individual who is age 55 or older and who is determined under 
        guidelines developed by the Governing Board to be low-income, 
        using the most recent available data provided by the Bureau of 
        the Census, prior to the determination.
            (19) Outlying area.--The term ``outlying area'' means the 
        United States Virgin Islands, Guam, American Samoa, the 
        Commonwealth of the Northern Mariana Islands, the Republic of 
        the Marshall Islands, the Federated States of Micronesia, and 
        the Republic of Palau.
            (20) Participant.--The term ``participant'' means an 
        individual participating in workforce development activities or 
        workforce preparation activities for at-risk youth, provided 
        through a statewide system.
            (21) Postsecondary educational institution.--The term 
        ``postsecondary educational institution'' means an institution 
        of higher education, as defined in section 481(a) of the Higher 
        Education Act of 1965 (20 U.S.C. 1088(a)), that offers--
                    (A) a 2-year program of instruction leading to an 
                associate's degree or a certificate of mastery; or
                    (B) a 4-year program of instruction leading to a 
                bachelor's degree.
            (22) Rapid response assistance.--The term ``rapid response 
        assistance'' means workforce employment assistance provided in 
        the case of a permanent closure, or layoff of 50 or more 
        people, at a
         plant, facility, or enterprise, including the establishment of 
on-site contact with employers and employee representatives immediately 
after the State is notified of a current or projected permanent 
closure, or layoff of 50 or more people.
            (23) School-to-work activities.--The term ``school-to-work 
        activities'' means activities for youth that--
                    (A) integrate school-based learning and work-based 
                learning;
                    (B) integrate academic and occupational learning;
                    (C) establish effective linkages between secondary 
                education and postsecondary education;
                    (D) provide each youth participant with the 
                opportunity to complete a career major; and
                    (E) provide assistance in the form of connecting 
                activities that link each youth participant with an 
                employer in an industry or occupation relating to the 
                career major of the youth participant.
            (24) State.--The term ``State'' means each of the several 
        States of the United States, the District of Columbia, and the 
        Commonwealth of Puerto Rico.
            (25) State benchmarks.--The term ``State benchmarks'', used 
        with respect to a State, means--
                    (A) the quantifiable indicators established under 
                section 731(c) and identified in the report submitted 
                under section 731(a); and
                    (B) such other quantifiable indicators of the 
                statewide progress of the State toward meeting the 
                State goals as the State may identify in the report 
                submitted under section 731(a).
            (26) State educational agency.--The term ``State 
        educational agency'' means the State board of education or 
        other agency or officer primarily responsible for the State 
        supervision of public elementary or secondary schools, or, if 
        there is no such officer or agency, an officer or agency 
        designated by the chief Governor or by State law.
            (27) State goals.--The term ``State goals'', used with 
        respect to a State, means--
                    (A) the goals specified in section 731(b); and
                    (B) such other major goals of the statewide system 
                of the State as the State may identify in the report 
                submitted under section 731(a).
            (28) Statewide system.--The term ``statewide system'' means 
        a statewide workforce development system, referred to in 
        section 711, that is designed to integrate workforce employment 
        activities, workforce education activities, flexible workforce 
        activities, economic development activities (in a State that is 
        eligible to carry out such activities), vocational 
        rehabilitation program activities, and workforce preparation 
        activities for at-risk youth in the State in order to enhance 
        and develop more fully the academic, occupational, and literacy 
        skills of all segments of the population of the State and 
        assist participants in obtaining meaningful unsubsidized 
        employment.
            (29) Substate area.--The term ``substate area'' means a 
        geographic area designated by a Governor that reflects, to the 
        extent feasible, a local labor market in a State.
            (30) Tech-prep program.--The term ``tech-prep program'' 
        means a program of study that--
                    (A) combines at least 2 years of secondary 
                education (as determined under State law) and 2 years 
                of postsecondary education in a nonduplicative 
                sequence;
                    (B) integrates academic and vocational instruction 
                and utilizes worksite learning where appropriate;
                    (C) provides technical preparation in an area such 
                as engineering technology, applied science, a 
                mechanical, industrial, or practical art or trade, 
                agriculture, a health occupation, or business;
                    (D) builds student competence in mathematics, 
                science, communications, and workplace skills, through 
                applied academics and integrated instruction in a 
                coherent sequence of courses;
                    (E) leads to an associate degree or a certificate 
                in a specific career field; and
                    (F) leads to placement in appropriate employment or 
                further education.
            (31) Vocational education.--The term ``vocational 
        education'' means organized educational programs that--
                    (A) offer a sequence of courses that provide 
                individuals with the academic knowledge and skills the 
                individuals need to prepare for further education and 
                careers in current or emerging employment sectors; and
                    (B) include competency-based applied learning that 
                contributes to the academic knowledge, higher-order 
                reasoning and problem-solving skills, work attitudes, 
                general employability skills, and occupational-specific 
                skills, of an individual.
            (32) Vocational rehabilitation program.--The term 
        ``vocational rehabilitation program'' means a program assisted 
        under title I of the Rehabilitation Act of 1973 (29 U.S.C. 720 
        et seq.).
            (33) Welfare assistance.--The term ``welfare assistance'' 
        means--
                    (A) assistance provided under part A of title IV of 
                the Social Security Act; and
                    (B) assistance provided under the Food Stamp Act of 
                1977 (7 U.S.C. 2011 et seq.).
            (34) Welfare recipient.--The term ``welfare recipient'' 
        means--
                    (A) an individual who receives assistance under 
                part A of title IV of the Social Security Act; and
                    (B) an individual who--
                            (i) is not an individual described in 
                        subparagraph (A); and
                            (ii) receives assistance under the Food 
                        Stamp Act of 1977.
            (35) Workforce development activities.--The term 
        ``workforce development activities'' means workforce education 
        activities, workforce employment activities, flexible workforce 
        activities, and economic development activities (within a State 
        that is eligible to carry out such activities).
            (36) Workforce education activities.--The term ``workforce 
        education activities'' means the activities described in 
        section 716(b).
            (37) Workforce employment activities.--The term ``workforce 
        employment activities'' means the activities described in 
        paragraphs (2) through (8) of section 716(a), including 
        activities described in section 716(a)(6) provided through a 
        voucher described in section 716(a)(9).
            (38) Workforce preparation activities for at-risk youth.--
        The term ``workforce preparation activities for at-risk youth'' 
        means the activities described in section 759(b), carried out 
        for at-risk youth.

          Subtitle B--Statewide Workforce Development Systems

          CHAPTER 1--PROVISIONS FOR STATES AND OTHER ENTITIES

SEC. 711. STATEWIDE WORKFORCE DEVELOPMENT SYSTEMS ESTABLISHED.

    For program year 1998 and each subsequent program year, the 
Governing Board shall make allotments under section 712 to States to 
assist the States in paying for the cost of establishing and carrying 
out activities through statewide workforce development systems, in 
accordance with this subtitle.

SEC. 712. STATE ALLOTMENTS.

    (a) In General.--The Governing Board shall allot to each State with 
a State plan approved under section 714 an amount equal to the total of 
the amounts made available under subparagraphs (A), (B), (C), and (D) 
of subsection (b)(2), adjusted in accordance with subsection (c).
    (b) Allotments Based on Populations.--
            (1) Definitions.--As used in this subsection:
                    (A) Adult recipient of assistance.--The term 
                ``adult recipient of assistance'' means a recipient of 
                assistance under a State program funded under part A of 
                title IV of the Social Security Act (42 U.S.C. 601 et 
                seq.) who is not a minor child (as defined in section 
                402(c)(1) of such Act).
                    (B) Individual in poverty.--The term ``individual 
                in poverty'' means an individual who--
                            (i) is not less than age 18;
                            (ii) is not more than age 64; and
                            (iii) is a member of a family (of 1 or more 
                        members) with an income at or below the poverty 
                        line.
                    (C) Poverty line.--The term ``poverty line'' means 
                the poverty line (as defined by the Office of 
                Management and Budget, and revised annually in 
                accordance with section 673(2) of the Community 
                Services Block Grant Act (42 U.S.C. 9902(2)) applicable 
                to a family of the size involved, using the most recent 
                available data provided by the Bureau of the Census, 
                prior to the program year for which the allotment is 
                made, and applying the definition of poverty used by 
                the Bureau of the Census in compiling the 1990 
                decennial census.
            (2) Calculation.--Except as provided in subsection (c), 
        from the amount reserved under section 734(b)(1), the Governing 
        Board--
                    (A) using funds equal to 60 percent of such 
                reserved amount, shall make available to each State an 
                amount that bears the same relationship to such funds 
                as the total number of individuals who are not less 
                than 15 and not more than 65 (as determined by the 
                Governing Board using the most recent available data 
                provided by the Bureau of the Census, prior to the 
                program year for which the allotment is made) in the 
                State bears to the total number of such individuals in 
                all States;
                    (B) using funds equal to 10 percent of such 
                reserved amount, shall make available to each State an 
                amount that bears the same relationship to such funds 
                as the total number of individuals in poverty in the 
                State bears to the total number of individuals in 
                poverty in all States;
                    (C) using funds equal to 10 percent of such 
                reserved amount, shall make available to each State an 
                amount that bears the same relationship to such funds 
                as the average number of unemployed individuals (as 
                determined by the Secretary of Labor for the most 
                recent 24-month period for which data are available, 
                prior to the program year for which the allotment is 
                made) in the State bears to the average number of 
                unemployed individuals (as so determined) in all 
                States; and
                    (D) using funds equal to 20 percent of such 
                reserved amount, shall make available to each State an 
                amount that bears the same relationship to such funds 
                as the average monthly number of adult recipients of 
                assistance (as determined by the Secretary of Health 
                and Human Services for the most recent 12-month period 
                for which data are available, prior to the program year 
                for which the allotment is made) in the State bears to 
                the average monthly number of adult recipients of 
                assistance (as so determined) in all States.
    (c) Adjustments.--
            (1) Definition.--As used in this subsection, the term 
        ``national average per capita payment'', used with respect to a 
        program year, means the amount obtained by dividing--
                    (A) the total amount allotted to all States under 
                this section for the program year; by
                    (B) the total number of individuals who are not 
                less than 15 and not more than 65 (as determined by the 
                Governing Board using the most recent available data 
                provided by the Bureau of the Census, prior to the 
                program year for which the allotment is made) in all 
                States.
            (2) Minimum allotment.--Except as provided in paragraph 
        (3), no State with a State plan approved under section 714 for 
        a program year shall receive an allotment under this section 
        for the program year in an amount that is less than 0.5 percent 
        of the amount reserved under section 734(b)(1) for the program 
        year.
            (3) Limitation.--No State that receives an increase in an 
        allotment under this section for a program year as a result of 
        the application of paragraph (2) shall receive an allotment 
        under this section for the program year in an amount that is 
        more than the product obtained by multiplying--
                    (A) the total number of individuals who are not 
                less than 15 and not more than 65 (as determined by the 
                Governing Board using the most recent available data 
                provided by the Bureau of the Census, prior to the 
                program year for which the allotment is made) in the 
                State; and
                    (B) the product obtained by multiplying--
                            (i) 1.3; and
                            (ii) the national average per capita 
                        payment for the program year.

SEC. 713. STATE APPORTIONMENT BY ACTIVITY.

    (a) Activities.--From the sum of the funds made available to a 
State through an allotment received under section 712 and the funds 
made available under section 901(c)(1)(A) of the Social Security Act 
(42 U.S.C. 1101(c)(1)(A)) to carry out this title for a program year--
            (1) a portion equal to 25 percent of such sum (which 
        portion shall include the amount allotted to the State from 
        funds made available under section 901(c)(1)(A) of the Social 
        Security Act) shall be made available for workforce employment 
        activities;
            (2) a portion equal to 25 percent of such sum shall be made 
        available for workforce education activities; and
            (3) a portion (referred to in this title as the ``flex 
        account'') equal to 50 percent of such sum shall be made 
        available for flexible workforce activities.
    (b) Recipients.--In making an allotment under section 712 to a 
State, the Governing Board shall make a payment--
            (1) to the Governor of the State for the portion described 
        in subsection (a)(1), and such part of the flex account as the 
        Governor may be eligible to receive, as determined under the 
        State plan of the State submitted under section 714; and
            (2) to the State educational agency of the State for the 
        portion described in subsection (a)(2), and such part of the 
        flex account as the State educational agency may be eligible to 
        receive, as determined under the State plan of the State 
        submitted under section 714.

SEC. 714. STATE PLANS.

    (a) In General.--For a State to be eligible to receive an allotment 
under section 712, the Governor of the State shall submit to the 
Governing Board, and obtain approval of, a single comprehensive State 
workforce development plan (referred to in this section as a ``State 
plan''), outlining a 3-year strategy for the statewide system of the 
State.
    (b) Parts.--
            (1) In general.--The State plan shall contain 3 parts.
            (2) Strategic plan and flexible workforce activities.--The 
        first part of the State plan shall describe a strategic plan 
        for the statewide system, including the flexible workforce 
        activities, and, if appropriate, economic development 
        activities, that are designed to meet the State goals and reach 
        the State benchmarks and are to be carried out with the 
        allotment. The Governor shall develop the first part of the 
        State plan, using procedures that are consistent with the 
        procedures described in subsection (d).
            (3) Workforce employment activities.--The second part of 
        the State plan shall describe the workforce employment 
        activities that are designed to meet the State goals and reach 
        the State benchmarks and are to be carried out with the 
        allotment. The Governor shall develop the second part of the 
        State plan.
            (4) Workforce education activities.--The third part of the 
        State plan shall describe the workforce education activities 
        that are designed to meet the State goals and reach the State 
        benchmarks and are to be carried out with the allotment. The 
        State educational agency of the State shall develop the third 
        part of the State plan.
    (c) Contents of the Plan.--The State plan shall include--
            (1) with respect to the strategic plan for the statewide 
        system--
                    (A) information describing how the State will 
                identify the current and future workforce development 
                needs of the industry sectors most important to the 
                economic competitiveness of the State;
                    (B) information describing how the State will 
                identify the current and future workforce development 
                needs of all segments of the population of the State;
                    (C) information identifying the State goals and 
                State benchmarks and how the goals and benchmarks will 
                make the statewide system relevant and responsive to 
                labor market and education needs at the local level;
                    (D) information describing how the State will 
                coordinate workforce development activities to meet the 
                State goals and reach the State benchmarks;
                    (E) information describing the allocation within 
                the State of the funds made available through the flex 
                account for the State, and how
                 the flexible workforce activities, including school-
to-work activities, to be carried out with such funds will be carried 
out to meet the State goals and reach the State benchmarks;
                    (F) information identifying how the State will 
                obtain the active and continuous participation of 
                business, industry, and labor in the development and 
                continuous improvement of the statewide system;
                    (G) information identifying how any funds that a 
                State receives under this subtitle will be leveraged 
                with other public and private resources to maximize the 
                effectiveness of such resources for all workforce 
                development activities, and expand the participation of 
                business, industry, labor, and individuals in the 
                statewide system;
                    (H) information describing how the State will 
                eliminate duplication in the administration and 
                delivery of services under this title;
                    (I) information describing the process the State 
                will use to independently evaluate and continuously 
                improve the performance of the statewide system, on a 
                yearly basis, including the development of specific 
                performance indicators to measure progress toward 
                meeting the State goals;
                    (J) an assurance that the funds made available 
                under this subtitle will supplement and not supplant 
                other public funds expended to provide workforce 
                development activities;
                    (K) information identifying the steps that the 
                State will take over the 3 years covered by the plan to 
                establish common data collection and reporting 
                requirements for workforce development activities and 
                vocational rehabilitation program activities;
                    (L) with respect to economic development 
                activities, information--
                            (i) describing the activities to be carried 
                        out with the funds made available under this 
                        subtitle;
                            (ii) describing how the activities will 
                        lead directly to increased earnings of 
                        nonmanagerial employees in the State; and
                            (iii) describing whether the labor 
                        organization, if any, representing the 
                        nonmanagerial employees supports the 
                        activities;
                    (M) the description referred to in subsection 
                (d)(1); and
                    (N)(i) information demonstrating the support of 
                individuals and entities described in subsection (d)(1) 
                for the plan; or
                    (ii) in a case in which the Governor is unable to 
                obtain the support of such individuals and entities as 
                provided in subsection (d)(2), the comments referred to 
                in subsection (d)(2)(B),
            (2) with respect to workforce employment activities, 
        information--
                    (A)(i) identifying and designating substate areas, 
                including urban and rural areas, to which funds 
                received through the allotment will be distributed, 
                which areas shall, to the extent feasible, reflect 
                local labor market areas; or
                    (ii) stating that the State will be treated as a 
                substate area for purposes of the application of this 
                subtitle, if the State receives an increase in an 
                allotment under section 712 for a program year as a 
                result of the application of section 712(c)(2); and
                    (B) describing the basic features of one-stop 
                delivery of core services described in section 
                716(a)(2) in the State, including information 
                regarding--
                            (i) the strategy of the State for 
                        developing fully operational one-stop delivery 
                        of core services described in section 
                        716(a)(2);
                            (ii) the time frame for achieving the 
                        strategy;
                            (iii) the estimated cost for achieving the 
                        strategy;
                            (iv) the steps that the State will take 
                        over the 3 years covered by the plan to provide 
                        individuals with access to one-stop delivery of 
                        core services described in section 716(a)(2);
                            (v) the steps that the State will take over 
                        the 3 years covered by the plan to provide 
                        information through the one-stop delivery to 
                        individuals on the quality of workforce 
                        employment activities, workforce education 
                        activities, and vocational rehabilitation 
                        program activities, provided through the 
                        statewide system;
                            (vi) the steps that the State will take 
                        over the 3 years covered by the plan to link 
                        services provided through the one-stop delivery 
                        with services provided through State welfare 
                        agencies; and
                            (vii) in a case in which the State chooses 
                        to use vouchers to deliver workforce employment 
                        activities, the steps that the State will take 
                        over the 3 years covered by the plan to comply 
                        with the requirements in section 716(a)(9) and 
                        the information required in such section;
                    (C) identifying performance indicators that relate 
                to the State goals, and to the State benchmarks, 
                concerning workforce employment activities;
                    (D) describing the workforce employment activities 
                to be carried out with funds received through the 
                allotment;
                    (E) describing the steps that the State will take 
                over the 3 years covered by the plan to establish a 
                statewide comprehensive labor market information system 
                described in section 773(c) that will be utilized by 
                all the providers of one-stop delivery of core services 
                described in section 716(a)(2), providers of other 
                workforce employment activities, and providers of 
                workforce education activities, in the State;
                    (F) describing the steps that the State will take 
                over the 3 years covered by the plan to establish a job 
                placement accountability system described in section 
                731(d); and
                    (G)(i) describing the steps that the State will 
                take to segregate the amount allotted to the State from 
                funds made available under section 901(c)(1)(A) of the 
                Social Security Act (42 U.S.C. 1101(c)(1)(A)) from the 
                remainder of the portion described in section 
                713(a)(1); and
                    (ii) describing how the State will use the amount 
                allotted to the State from funds made available under 
                such section 901(c)(1)(A) to carry out--
                            (I) the required activities described in 
                        clauses (ii) through (v) of section 
                        716(a)(2)(B) and section 773; and
                            (II) any permissive activities carried out 
                        by the State that consist of--
                                    (aa) the evaluation of programs 
                                provided through the statewide system 
                                of the State;
                                    (bb) the provision of services 
                                through the statewide system for 
                                workers who have received notice of 
                                permanent or impending layoff, or 
                                workers in occupations that are 
                                experiencing limited demand due to 
                                technological change, the impact of 
                                imports, or plant closures; or
                                    (cc) the administration of the work 
                                test for the State unemployment 
                                compensation system and provision of 
                                job finding and placement services for 
                                unemployment insurance claimants; and
            (3) with respect to workforce education activities, 
        information--
                    (A) describing how funds received through the 
                allotment will be allocated among--
                            (i) secondary school vocational education, 
                        or postsecondary and adult vocational 
                        education, or both; and
                            (ii) adult education;
                    (B) identifying performance indicators that relate 
                to the State goals, and to the State benchmarks, 
                concerning workforce education activities;
                    (C) describing the workforce education activities 
                that will be carried out with funds received through 
                the allotment;
                    (D) describing how the State will address the adult 
                education needs of the State;
                    (E) describing how the State will disaggregate data 
                relating to at-risk youth in order to adequately 
                measure the progress of at-risk youth toward 
                accomplishing the results measured by the State goals, 
                and the State benchmarks;
                    (F) describing how the State will adequately 
                address the needs of both at-risk youth who are in 
                school, and out-of-school youth, in alternative 
                education programs that teach to the same challenging 
                academic, occupational, and skill proficiencies as are 
                provided for in-school youth;
                    (G) describing how the workforce education 
                activities described in the State plan and the State 
                allocation of funds received through the allotment for 
                such activities are an integral part of comprehensive 
                efforts of the State to improve education for all 
                students and adults;
                    (H) describing how the State will annually evaluate 
                the effectiveness of the State plan with respect to 
                workforce education activities;
                    (I) describing how the State will address the 
                professional development needs of the State with 
                respect to workforce education activities;
                    (J) describing how the State will provide local 
                educational agencies in the State with technical 
                assistance; and
                    (K) describing how the State will assess the 
                progress of the State in implementing student 
                performance measures.
    (d) Procedure for Development of Part of Plan Relating to Strategic 
Plan.--
            (1) Description of development.--The part of the State plan 
        relating to the strategic plan shall include a description of 
        the manner in which--
                    (A) the Governor;
                    (B) the State educational agency;
                    (C) representatives of business and industry, 
                including representatives of key industry sectors, and 
                of small- and medium-size and large employers, in the 
                State;
                    (D) representatives of labor and workers;
                    (E) local elected officials from throughout the 
                State;
                    (F) the State agency officials responsible for 
                vocational education;
                    (G) the State agency officials responsible for 
                postsecondary education;
                    (H) the State agency officials responsible for 
                adult education;
                    (I) the State agency officials responsible for 
                vocational rehabilitation;
                    (J) such other State agency officials, including 
                officials responsible for economic development and 
                employment, as the Governor may designate;
                    (K) representatives of elected officials of tribal 
                governments;
                    (L) the representative of the Veterans' Employment 
                Training Service assigned to the State under section 
                4103 of title 38, United States Code; and
                    (M) other appropriate officials, including members 
                of the State workforce development board described in 
                section 715, if the State has established such a board;
        collaborated in the development of such part of the plan.
            (2) Failure to obtain support.--If, after a reasonable 
        effort, the Governor is unable to obtain the support of the 
        individuals and entities described in paragraph (1) for the 
        strategic plan the Governor shall--
                    (A) provide such individuals and entities with 
                copies of the strategic plan;
                    (B) allow such individuals and entities to submit 
                to the Governor, not later than the end of the 30-day 
                period beginning on the date on which the Governor 
                provides such individuals and entities with copies of 
                such plan under subparagraph (A), comments on such 
                plan; and
                    (C) include any such comments in such plan.
    (e) Approval.--The Governing Board shall approve a State plan if 
the Governing Board--
            (1) determines that the plan contains the information 
        described in subsection (c);
            (2) determines that the State has prepared the plan in 
        accordance with the requirements of this section, including the 
        requirements relating to development of any part of the plan; 
        and
            (3) has negotiated State benchmarks with the State in 
        accordance with section 731(c).
    (f) No Entitlement to a Service.--Nothing in this title shall be 
construed to provide any individual with an entitlement to a service 
provided under this title.

SEC. 715. STATE WORKFORCE DEVELOPMENT BOARDS.

    (a) Establishment.--A Governor of a State that receives an 
allotment under section 712 may establish a State workforce development 
board--
            (1) on which a majority of the members are representatives 
        of business and industry;
            (2) on which not less than 25 percent of the members shall 
        be representatives of labor, workers, and community-based 
        organizations;
            (3) that shall include representatives of veterans;
            (4) that shall include a representative of the State 
        educational agency and a representative from the State agency 
        responsible for vocational rehabilitation;
            (5) that may include any other individual or entity that 
        participates in the collaboration described in section 
        714(d)(1); and
            (6) that may include any other individual or entity the 
        Governor may designate.
    (b) Chairperson.--The State workforce development board shall 
select a chairperson from among the members of the board who are 
representatives of business and industry.
    (c) Functions.--The functions of the State workforce development 
board shall include--
            (1) advising the Governor on the development of the 
        statewide system, the State plan described in section 714, and 
        the State goals and State benchmarks;
            (2) assisting in the development of specific performance 
        indicators to measure progress toward meeting the State goals 
        and reaching the State benchmarks and providing guidance on how 
        such progress may be improved;
            (3) serving as a link between business, industry, labor, 
        and the statewide system;
            (4) assisting the Governor in preparing the annual report 
        to the Governing Board regarding progress in reaching the State 
        benchmarks, as described in section 731(a);
            (5) receiving and commenting on the State plan developed 
        under section 101 of the Rehabilitation Act of 1973 (29 U.S.C. 
        721);
            (6) assisting the Governor in developing the statewide 
        comprehensive labor market information system described in 
        section 773(c) to provide information that will be utilized by 
        all the providers of one-stop delivery of core services 
        described in section 716(a)(2), providers of other workforce 
        employment activities, and providers of workforce education 
        activities, in the State; and
            (7) assisting in the monitoring and continuous improvement 
        of the performance of the statewide system, including 
        evaluation of the effectiveness of workforce development 
        activities funded under this title.
SEC. 716. USE OF FUNDS.

    (a) Workforce Employment Activities.--
            (1) In general.--Funds made available to a State under this 
        subtitle to carry out workforce employment activities through a 
        statewide system--
                    (A) shall be used to carry out the activities 
                described in paragraphs (2), (3), and (4); and
                    (B) may be used to carry out the activities 
                described in paragraphs (5), (6), (7), and (8), 
                including providing activities described in paragraph 
                (6) through vouchers described in paragraph (9).
            (2) One-stop delivery of core services.--
                    (A) Access.--The State shall use a portion of the 
                funds described in paragraph (1) to establish a means 
                of providing access to the statewide system through 
                core services described in subparagraph (B) available--
                            (i) through multiple, connected access 
                        points, linked electronically or otherwise;
                            (ii) through a network that assures 
                        participants that such core services will be 
                        available regardless of where the participants 
                        initially enter the statewide system;
                            (iii) at not less than 1 physical location 
                        in each substate area of the State; or
                            (iv) through some combination of the 
                        options described in clauses (i), (ii), and 
                        (iii).
                    (B) Core services.--The core services referred to 
                in subparagraph (A) shall, at a minimum, include--
                            (i) outreach, intake, and orientation to 
                        the information and other services available 
                        through one-stop delivery of core services 
                        described in this subparagraph;
                            (ii) initial assessment of skill levels, 
                        aptitudes, abilities, and supportive service 
                        needs;
                            (iii) job search and placement assistance 
                        and, where appropriate, career counseling;
                            (iv) customized screening and referral of 
                        qualified applicants to employment;
                            (v) provision of accurate information 
                        relating to local labor market conditions, 
                        including employment profiles of growth 
                        industries and occupations within a substate 
                        area, the educational and skills requirements 
                        of jobs in the industries and occupations, and 
                        the earnings potential of the jobs;
                            (vi) provision of accurate information 
                        relating to the quality and availability of 
                        other workforce employment activities, 
                        workforce education activities, and vocational 
                        rehabilitation program activities;
                            (vii) provision of information regarding 
                        how the substate area is performing on the 
                        State benchmarks;
                            (viii) provision of initial eligibility 
                        information on forms of public financial 
                        assistance that may be available in order to 
                        enable persons to participate in workforce 
                        employment activities, workforce education 
                        activities, or vocational rehabilitation 
                        program activities; and
                            (ix) referral to other appropriate 
                        workforce employment activities, workforce 
                        education activities, and vocational 
                        rehabilitation employment activities.
            (3) Labor market information system.--The State shall use a 
        portion of the funds described in paragraph (1) to establish a 
        statewide comprehensive labor market information system 
        described in section 773(c).
            (4) Job placement accountability system.--The State shall 
        use a portion of the funds described in paragraph (1) to 
        establish a job placement accountability system described in 
        section 731(d).
            (5) Permissible one-stop delivery activities.--The State 
        may provide, through one-stop delivery--
                    (A) co-location of services related to workforce 
                development activities, such as unemployment insurance, 
                vocational rehabilitation program activities, welfare 
                assistance, veterans' employment services, or other 
                public assistance;
                    (B) intensive services for participants who are 
                unable to obtain employment through the core services 
                described in paragraph (2)(B), as determined by the 
                State; and
                    (C) dissemination to employers of information on 
                activities carried out through the statewide system.
            (6) Other permissible activities.--The State may use a 
        portion of the funds described in paragraph (1) to provide 
        services through the statewide system that may include--
                    (A) on-the-job training;
                    (B) occupational skills training;
                    (C) entrepreneurial training;
                    (D) training to develop work habits to help 
                individuals obtain and retain employment;
                    (E) customized training conducted with a commitment 
                by an employer or group of employers to employ an 
                individual after successful completion of the training;
                    (F) rapid response assistance for dislocated 
                workers;
                    (G) skill upgrading and retraining for persons not 
                in the workforce;
                    (H) preemployment and work maturity skills training 
                for youth;
                    (I) connecting activities that organize consortia 
                of small- and medium-size businesses to provide work-
                based learning opportunities for youth participants in 
                school-to-work programs;
                    (J) programs for adults that combine workplace 
                training with related instruction;
                    (K) services to assist individuals in attaining 
                certificates of mastery with respect to industry-based 
                skill standards;
                    (L) case management services;
                    (M) supportive services, such as transportation and 
                financial assistance, that enable individuals to 
                participate in the statewide system;
                    (N) followup services for participants who are 
                placed in unsubsidized employment; and
                    (O) workfare.
            (7) Staff development and training.--The State may use a 
        portion of the funds described in paragraph (1) for the 
        development and training of staff of providers of one-stop 
        delivery of core services described in paragraph (2), including 
        development and training relating to principles of quality 
        management.
            (8) Incentive grant awards.--The State may use a portion of 
        the funds described in paragraph (1) to award incentive grants 
        to substate areas that reach or exceed the State benchmarks 
        established under section 731(c), with an emphasis on 
        benchmarks established under section 731(c)(3). A substate area 
        that receives such a grant may use the funds made available 
        through the grant to carry out any workforce development 
        activities authorized under this title.
            (9) Vouchers.--
                    (A) In general.--A State may deliver some or all of 
                the workforce employment activities described in 
                paragraph (6) that are provided under this subtitle 
                through a system of vouchers administered through the 
                one-stop delivery of core services described in 
                paragraph (2) in the State.
                    (B) Eligibility requirements.--
                            (i) In general.--A State that chooses to 
                        deliver the activities described in 
                        subparagraph (A) through vouchers shall 
                        indicate in the State plan described in section 
                        714 the criteria that will be used to 
                        determine--
                                    (I) which workforce employment 
                                activities described in paragraph (6) 
                                will be delivered through the voucher 
                                system;
                                    (II) eligibility requirements for 
                                participants to receive the vouchers 
                                and the amount of funds that 
                                participants will be able to access 
                                through the voucher system; and
                                    (III) which employment, training, 
                                and education providers are eligible to 
                                receive payment through the vouchers.
                            (ii) Considerations.--In establishing State 
                        criteria for service providers eligible to 
                        receive payment through the vouchers under 
                        clause (i)(III), the State shall take into 
                        account industry-recognized skills standards 
                        promoted by the National Skills Standards 
                        Board.
                    (C) Accountability requirements.--A State that 
                chooses to deliver the activities described in 
                paragraph (6) through vouchers shall indicate in the 
                State plan--
                            (i) information concerning how the State 
                        will utilize the statewide comprehensive labor 
                        market information system described in section 
                        773(c) and the job placement accountability 
                        system established under section 731(d) to 
                        provide timely and accurate information to 
                        participants about the performance of eligible 
                        employment, training, and education providers;
                            (ii) other information about the 
                        performance of eligible providers of services 
                        that the State believes is necessary for 
                        participants receiving the vouchers to make 
                        informed career choices; and
                            (iii) the timeframe in which the 
                        information developed under clauses (i) and 
                        (ii) will be widely available through the one-
                        stop delivery of core services described in 
                        paragraph (2) in the State.
    (b) Workforce Education Activities.--The State educational agency 
shall use the funds made available to the State educational agency 
under this subtitle for workforce education activities to carry out, 
through the statewide system, activities that include--
            (1) integrating academic and vocational education;
            (2) linking secondary education (as determined under State 
        law) and postsecondary education, including implementing tech-
        prep programs;
            (3) providing career guidance and counseling for students 
        at the earliest possible age, including the provision of career 
        awareness, exploration, and guidance information to students 
        and their parents that is, to the extent possible, in a 
        language and form that the students and their parents 
        understand;
            (4) providing literacy and basic education services for 
        adults and out-of-school youth, including adults and out-of-
        school youth in correctional institutions;
            (5) providing programs for adults and out-of-school youth 
        to complete their secondary education;
            (6) expanding, improving, and modernizing quality 
        vocational education programs; and
            (7) improving access to quality vocational education 
        programs for at-risk youth.
    (c) Fiscal Requirements for Workforce Education Activities.--
            (1) Supplement not supplant.--Funds made available under 
        this subtitle for workforce education activities shall 
        supplement, and may not supplant, other public funds expended 
        to carry out workforce education activities.
            (2) Maintenance of effort.--
                    (A) Determination.--No payments shall be made under 
                this subtitle for any program year to a State for 
                workforce education activities unless the Governing 
                Board determines that the fiscal effort per student or 
                the aggregate expenditures of such State for workforce 
                education for the program year preceding the program 
                year for which the determination is made, equaled or 
                exceeded such effort or expenditures for workforce 
                education for the second program year preceding the 
                fiscal year for which the determination is made.
                    (B) Waiver.--The Governing Board may waive the 
                requirements of this section (with respect to not more 
                than 5 percent of expenditures by any State educational 
                agency) for 1 program year only, on making a 
                determination that such waiver would be equitable due 
                to exceptional or uncontrollable circumstances 
                affecting the ability of the applicant to meet such 
                requirements, such as a natural disaster or an 
                unforeseen and precipitous decline in financial 
                resources. No level of funding permitted under such a 
                waiver may be used as the basis for computing the 
                fiscal effort or aggregate expenditures required under 
                this section for years subsequent to the year covered 
                by such waiver. The fiscal effort or aggregate 
                expenditures for the subsequent years shall be computed 
                on the basis of the level of funding that would, but 
                for such waiver, have been required.
    (d) Flexible Workforce Activities.--
            (1) Core flexible workforce activities.--The State shall 
        use a portion of the funds made available to the State under 
        this subtitle through the flex account to carry out school-to-
        work activities through the statewide system, except that any 
        State that received a grant under subtitle B of title II of the 
        School-to-Work Opportunities Act of 1994 (20 U.S.C. 6141 et 
        seq.) shall use such portion to support the continued 
        development of the statewide School-to-Work Opportunities 
        system of the State through the continuation of activities that 
        are carried out in accordance with the terms of such grant.
            (2) Permissible flexible workforce activities.--The State 
        may use a portion of the funds made available to the State 
        under this subtitle through the flex account--
                    (A) to carry out workforce employment activities 
                through the statewide system; and
                    (B) to carry out workforce education activities 
                through the statewide system.
    (e) Economic Development Activities.--In the case of a State that 
meets the requirements of section 728(c), the State may use a portion 
of the funds made available to the State under this subtitle through 
the flex account to supplement other funds provided by the State or 
private sector--
            (1) to provide customized assessments of the skills of 
        workers and an analysis of the skill needs of employers;
            (2) to assist consortia of small- and medium-size employers 
        in upgrading the skills of their workforces;
            (3) to provide productivity and quality improvement 
        training programs for the workforces of small- and medium-size 
        employers;
            (4) to provide recognition and use of voluntary industry-
        developed skills standards by employers, schools, and training 
        institutions;
            (5) to carry out training activities in companies that are 
        developing modernization plans in conjunction with State 
        industrial extension service offices; and
            (6) to provide on-site, industry-specific training programs 
        supportive of industrial and economic development;
through the statewide system.
    (f) Limitations.--
            (1) Wages.--No funds provided under this subtitle shall be 
        used to pay the wages of incumbent workers during their 
        participation in economic development activities provided 
        through the statewide system.
            (2) Relocation.--No funds provided under this subtitle 
        shall be used or proposed for use to encourage or induce the 
        relocation, of a business or part of a business, that results 
        in a loss of employment for any employee of such business at 
        the original location.
            (3) Training and assessments following relocation.--No 
        funds provided under this subtitle shall be used for customized 
        or skill training, on-the-job training, or company specific 
        assessments of job applicants or workers, for any business or 
        part of a business, that has relocated, until 120 days after 
        the date on which such business commences operations at the new 
        location, if the relocation of such business or part of a 
        business, results in a loss of employment for any worker of 
        such business at the original location.
    (g) Limitations on Participants.--
            (1) Diploma or equivalent.--
                    (A) In general.--No individual may participate in 
                workforce employment activities described in 
                subparagraph (A), (B), (C), (E), (G), (J), or (K) of 
                section 716(a)(6) until the individual has obtained a 
                secondary school diploma or its recognized equivalent, 
                or is enrolled in a program or course of study to 
                obtain a secondary school diploma or its recognized 
                equivalent.
                    (B) Exception.--Nothing in subparagraph (A) shall 
                prevent participation in workforce employment 
                activities described under subparagraph (A), (B), (C), 
                (E), (G), (J), or (K) of section 716(a)(6) by 
                individuals who, after testing and in the judgment of 
                medical, psychiatric, academic, or other appropriate 
                professionals, lack the requisite capacity to complete 
                successfully a course of study that would lead to a 
                secondary school diploma or its recognized equivalent.
            (2) Services.--
                    (A) Referral.--If an individual who has not 
                obtained a secondary school diploma or its recognized 
                equivalent applies to participate in workforce 
                employment activities described under subparagraph (A), 
                (B), (C), (E), (G), (J), or (K) of section 716(a)(6), 
                such individual shall be referred to State approved 
                adult education services that provide instruction 
                designed to help such individual obtain a secondary 
                school diploma or its recognized equivalent.
                    (B) State provision of services.--Notwithstanding 
                any other provision of this title, a State may use 
                funds made available under section 713(a)(1) to provide 
                State approved adult education services that provide 
                instruction designed to help individuals obtain a 
                secondary school diploma or its recognized equivalent, 
                to individuals who--
                            (i) are seeking to participate in workforce 
                        employment activities described under 
                        subparagraph (A), (B), (C), (E), (G), (J), or 
                        (K) of section 716(a)(6); and
                            (ii) are otherwise unable to obtain such 
                        services.

SEC. 717. INDIAN WORKFORCE DEVELOPMENT ACTIVITIES.

    (a) Purpose.--
            (1) In general.--The purpose of this section is to support 
        workforce development activities for Indian and Native Hawaiian 
        individuals in order--
                    (A) to develop more fully the academic, 
                occupational, and literacy skills of such individuals;
                    (B) to make such individuals more competitive in 
                the workforce; and
                    (C) to promote the economic and social development 
                of Indian and Native Hawaiian communities in accordance 
                with the goals and values of such communities.
            (2)  Indian policy.--All programs assisted under this 
        section shall be administered in a manner consistent with the 
        principles of the Indian Self-Determination and Education 
        Assistance Act (25 U.S.C. 450 et seq.) and the government-to-
        government relationship between the Federal Government and 
        Indian tribal governments.
    (b) Definitions.--As used in this section:
            (1) Alaska native.--The term ``Alaska Native'' means a 
        Native as such term is defined in section 3(b) of the Alaska 
        Native Claims Settlement Act (43 U.S.C. 1602(b)).
            (2) Indian, indian tribe, and tribal organization.--The 
        terms ``Indian'', ``Indian tribe'', and ``tribal organization'' 
        have the same meanings given such terms in subsections (d), (e) 
        and (l), respectively, of section 4 of the Indian Self-
        Determination and Education Assistance Act (25 U.S.C. 450b).
            (3) Institution of higher education.--The term 
        ``institution of higher education'' has the meaning given the 
        term in section 1201(a) of the Higher Education Act of 1965 (20 
        U.S.C. 1141(a)).
            (4) Native hawaiian and native hawaiian organization.--The 
        terms ``Native Hawaiian'' and ``Native Hawaiian organization'' 
        have the same meanings given such terms in paragraphs (1) and 
        (3), respectively, of section 9212 of the Native Hawaiian 
        Education Act (20 U.S.C. 7912).
            (5) Tribally controlled community college.--The term 
        ``tribally controlled community college'' has the same meaning 
        given such term in section 2(a)(4) of the Tribally Controlled 
        Community College Assistance Act of 1978 (25 U.S.C. 
        1801(a)(4)).
            (6) Tribally controlled postsecondary vocational 
        institution.--The term ``tribally controlled postsecondary 
        vocational institution'' means an institution of higher 
        education that--
                    (A) is formally controlled, or has been formally 
                sanctioned or chartered, by the governing body of an 
                Indian tribe or Indian tribes;
                    (B) offers a technical degree or certificate 
                granting program;
                    (C) is governed by a board of directors or 
                trustees, a majority of whom are Indians;
                    (D) demonstrates adherence to stated goals, a 
                philosophy, or a plan of operation, that fosters 
                individual Indian economic and self-sufficiency 
                opportunity, including programs that are appropriate to 
                stated tribal goals of developing individual 
                entrepreneurships and self-sustaining economic 
                infrastructures on reservations;
                    (E) has been in operation for at least 3 years;
                    (F) holds accreditation with or is a candidate for 
                accreditation by a nationally recognized accrediting 
                authority for postsecondary vocational education; and
                    (G) enrolls the full-time equivalent of not fewer 
                than 100 students, of whom a majority are Indians.
    (c) Program Authorized.--
            (1) Assistance authorized.--From amounts made available 
        under section 734(b)(2), the Governing Board shall make grants 
        to, or enter into contracts or cooperative agreements with, 
        Indian tribes and tribal organizations, Alaska Native entities, 
        tribally controlled community colleges, tribally controlled 
        postsecondary vocational institutions, Indian-controlled 
        organizations serving Indians or Alaska Natives, and Native 
        Hawaiian organizations to carry out the authorized activities 
        described in subsection (d).
            (2) Formula.--The Governing Board shall make grants to, or 
        enter into contracts and cooperative agreements with, entities 
        as described in paragraph (1) to carry out the activities 
        described in paragraphs (2) and (3) of subsection (d) on the 
        basis of a formula developed by the Governing Board in 
        consultation with entities described in paragraph (1).
    (d) Authorized Activities.--
            (1) In general.--Funds made available under this section 
        shall be used to carry out the activities described in 
        paragraphs (2) and (3) that--
                    (A) are consistent with this section; and
                    (B) are necessary to meet the needs of Indians and 
                Native Hawaiians preparing to enter, reenter, or retain 
                unsubsidized employment.
            (2) Workforce development activities and supplemental 
        services.--
                    (A) In general.--Funds made available under this 
                section shall be used for--
                            (i) comprehensive workforce development 
                        activities for Indians and Native Hawaiians;
                            (ii) supplemental services for Indian or 
                        Native Hawaiian youth on or near Indian 
                        reservations in Oklahoma, Alaska, or Hawaii; 
                        and
                            (iii) supplemental services to recipients 
                        of public assistance on or near Indian 
                        reservations or former reservation areas in 
                        Oklahoma or in Alaska.
                    (B) Special rule.--Notwithstanding any other 
                provision of this section, individuals who were 
                eligible to participate in programs under section 401 
                of the Job Training Partnership Act (29 U.S.C. 1671) 
                (as such section was in effect on the day before the 
                date of enactment of this Act) shall be eligible to 
                participate in an activity assisted under subparagraph 
                (A)(i).
            (3) Vocational education, adult education, and literacy 
        services.--Funds made available under this section shall be 
        used for--
                    (A) workforce education activities conducted by 
                entities described in subsection (c)(1); and
                    (B) the support of tribally controlled 
                postsecondary vocational institutions in order to 
                ensure continuing and expanded educational 
                opportunities for Indian students.
    (e) Program Plan.--In order to receive a grant or enter into a 
contract or cooperative agreement under this section an entity 
described in subsection (c)(1) shall submit to the Governing Board a 
plan that describes a 3-year strategy for meeting the needs of Indian 
and Native Hawaiian individuals, as appropriate, in the area served by 
such entity. Such plan shall--
            (1) be consistent with the purposes of this section;
            (2) identify the population to be served;
            (3) identify the education and employment needs of the 
        population to be served and the manner in which the services to 
        be provided will strengthen the ability of the individuals 
        served to obtain or retain unsubsidized employment;
            (4) describe the services to be provided and the manner in 
        which such services are to be integrated with other appropriate 
        services; and
            (5) describe the goals and benchmarks to be used to assess 
        the performance of entities in carrying out the activities 
        assisted under this section.
    (f) Further Consolidation of Funds.--Each entity receiving 
assistance under this section may consolidate such assistance with 
assistance received from related programs in accordance with the 
provisions of the Indian Employment, Training and Related Services 
Demonstration Act of 1992 (25 U.S.C. 3401 et seq.).
    (g) Nonduplicative and Nonexclusive Services.--Nothing in this 
section shall be construed--
            (1) to limit the eligibility of any entity described in 
        subsection (c)(1) to participate in any program offered by a 
        State or local entity under this title; or
            (2) to preclude or discourage any agreement, between any 
        entity described in subsection (c)(1) and any State or local 
        entity, to facilitate the provision of services by such entity 
        or to the population served by such entity.
    (h) Partnership Provisions.--
            (1) Office established.--The Governing Board shall 
        establish an office within the Federal Partnership to 
        administer the activities assisted under this section.
            (2) Consultation required.--
                    (A) In general.--The Governing Board, through the 
                office established under paragraph (1), shall develop 
                regulations and policies for activities assisted under 
                this section in consultation with tribal organizations 
                and Native Hawaiian organizations. Such regulations and 
                policies shall take into account the special 
                circumstances under which such activities operate.
                    (B) Administrative support.--The Governing Board 
                shall provide such administrative support to the office 
                established under paragraph (1) as the Governing Board 
                determines to be necessary to carry out the 
                consultation required by subparagraph (A).
            (3) Technical assistance.--The Governing Board, through the 
        office established under paragraph (1), is authorized to 
        provide technical assistance to entities described in 
        subsection (c)(1) that receive assistance under this section to 
        enable such entities to improve the workforce development 
        activities provided by such entities.

SEC. 718. GRANTS TO OUTLYING AREAS.

    (a) General Authority.--Using funds made available under section 
734(b)(3), the Governing Board shall make grants to outlying areas to 
carry out workforce development activities.
    (b) Application.--The Governing Board shall issue regulations 
specifying the provisions of this title that shall apply to outlying 
areas that receive funds under this subtitle.

                      CHAPTER 2--LOCAL PROVISIONS

SEC. 721. LOCAL APPORTIONMENT BY ACTIVITY.

    (a) Workforce Employment Activities.--
            (1) In general.--The sum of the funds made available to a 
        State for any program year under paragraphs (1) and (3) of 
        section 713(a) for workforce employment activities shall be 
        made available to the Governor of such State for use in 
        accordance with paragraph (2).
            (2) Distribution.--Of the sum described in paragraph (1), 
        for a program year--
                    (A) 25 percent shall be reserved by the Governor to 
                carry out workforce employment activities through the 
                statewide system; and
                    (B) 75 percent shall be distributed by the Governor 
                to local entities to carry out workforce employment 
                activities through the statewide system, based on--
                            (i) such factors as the relative 
                        distribution among substate areas of 
                        individuals who are not less than 15 and not 
                        more than 65, individuals in poverty, 
                        unemployed individuals, and adult recipients of 
                        assistance, as determined using the definitions 
                        specified and the determinations described in 
                        section 712(b); and
                            (ii) such additional factors as the 
                        Governor (in consultation with local 
                        partnerships described in section 728(a) or, 
                        where established, local workforce development 
                        boards described in section 728(b)), determines 
                        to be necessary.
    (b) Workforce Education Activities.--
            (1) In general.--The sum of the funds made available to a 
        State for any program year under paragraphs (2) and (3) of 
        section 713(a) for workforce education activities shall be made 
        available to the State educational agency serving such State 
        for use in accordance with paragraph (2).
            (2) Distribution.--Of the sum described in paragraph (1), 
        for a program year--
                    (A) 20 percent shall be reserved by the State 
                educational agency to carry out statewide workforce 
                education activities through the statewide system, of 
                which not more than 5 percent of such 20 percent may be 
                used for administrative expenses; and
                    (B) 80 percent shall be distributed by the State 
                educational agency to entities eligible for financial 
                assistance under section 722, 723, or 724, to carry out 
                workforce education activities through the statewide 
                system.
            (3) State determinations.--From the amount available to a 
        State educational agency under paragraph (2)(B) for a program 
        year, such agency shall determine the percentage of such amount 
        that will be distributed in accordance with sections 722, 723, 
        and 724 for such year for workforce education activities in 
        such State in each of the following areas:
                    (A) Secondary school vocational education, or 
                postsecondary and adult vocational education, or both; 
                and
                    (B) Adult education.
    (c) Special Rule.--Nothing in this subtitle shall be construed to 
prohibit any individual or agency in a State (other than the State 
educational agency) that is administering workforce education 
activities on the day preceding the date of enactment of this Act from 
continuing to administer such activities under this subtitle.

SEC. 722. DISTRIBUTION FOR SECONDARY SCHOOL VOCATIONAL EDUCATION.

    (a) Allocation.--Except as otherwise provided in this section and 
section 725, each State educational agency shall distribute the portion 
of the funds made available for any program year (from funds made 
available for the corresponding fiscal year, as determined under 
section 734(c)) by such agency for secondary school vocational 
education under section 721(b)(3)(A) to local educational agencies 
within the State as follows:
            (1) Seventy percent.--From 70 percent of such portion, each 
        local educational agency shall be allocated an amount that 
        bears the same relationship to such 70 percent as the amount 
        such local educational agency was allocated under section 1124 
        of the Elementary and Secondary Education Act of 1965 (20 
        U.S.C. 6333) for the preceding fiscal year bears to the total 
        amount received under such section by all local educational 
        agencies in the State for such year.
            (2) Twenty percent.--From 20 percent of such portion, each 
        local educational agency shall be allocated an amount that 
        bears the same relationship to such 20 percent as the number of 
        students with disabilities who have individualized education 
        programs under section 614(a)(5) of the Individuals with 
        Disabilities Education Act (20 U.S.C. 1414(a)(5)) served by 
        such local educational agency for the preceding fiscal year 
        bears to the total number of such students served by all local 
        educational agencies in the State for such year.
            (3) Ten percent.--From 10 percent of such portion, each 
        local educational agency shall be allocated an amount that 
        bears the same relationship to such 10 percent as the number of 
        students enrolled in schools and adults enrolled in training 
        programs under the jurisdiction of such local educational 
        agency for the preceding fiscal year bears to the number of 
        students enrolled in schools and adults enrolled in training 
        programs under the jurisdiction of all local educational 
        agencies in the State for such year.
    (b) Minimum Allocation.--
            (1) In general.--Except as provided in paragraph (2), no 
        local educational agency shall receive an allocation under 
        subsection (a) unless the amount allocated to such agency under 
        subsection (a) is not less than $15,000. A local educational 
        agency may enter into a consortium with other local educational 
        agencies for purposes of meeting the minimum allocation 
        requirement of this paragraph.
            (2) Waiver.--The State educational agency may waive the 
        application of paragraph (1) in any case in which the local 
        educational agency--
                    (A) is located in a rural, sparsely-populated area; 
                and
                    (B) demonstrates that such agency is unable to 
                enter into a consortium for purposes of providing 
                services under this section.
            (3) Redistribution.--Any amounts that are not allocated by 
        reason of paragraph (1) or (2) shall be redistributed to local 
        educational agencies that meet the requirements of paragraph 
        (1) or (2) in accordance with the provisions of this section.
    (c) Limited Jurisdiction Agencies.--
            (1) In general.--In applying the provisions of subsection 
        (a), no State educational agency receiving assistance under 
        this subtitle shall allocate funds to a local educational 
        agency that serves only elementary schools, but shall 
        distribute such funds to the local educational agency or 
        regional educational agency that provides secondary school 
        services to secondary school students in the same attendance 
        area.
            (2) Special rule.--The amount to be allocated under 
        paragraph (1) to a local educational agency that has 
        jurisdiction only over secondary schools shall be determined 
        based on the number of students that entered such secondary 
        schools in the previous year from the elementary schools 
        involved.
    (d) Allocations to Area Vocational Education Schools and 
Educational Service Agencies.--
            (1) In general.--Each State educational agency shall 
        distribute the portion of funds made available for any program 
        year by such agency for secondary school vocational education 
        under section 721(b)(3)(A) to the appropriate area vocational 
        education school or educational service agency in any case in 
        which--
                    (A) the area vocational education school or 
                educational service agency, and the local educational 
                agency concerned--
                            (i) have formed or will form a consortium 
                        for the purpose of receiving funds under this 
                        section; or
                            (ii) have entered into or will enter into a 
                        cooperative arrangement for such purpose; and
                    (B)(i) the area vocational education school or 
                educational service agency serves an approximately 
                equal or greater proportion of students who are 
                individuals with disabilities or are low-income than 
                the proportion of such students attending the secondary 
                schools under the jurisdiction of all of the local 
                educational agencies sending students to the area 
                vocational education school or the educational service 
                agency; or
                    (ii) the area vocational education school, 
                educational service agency, or local educational agency 
                demonstrates that the vocational education school or 
                educational service agency is unable to meet the 
                criterion described in clause (i) due to the lack of 
                interest by students described in clause (i) in 
                attending vocational education programs in that area 
                vocational education school or educational service 
                agency.
            (2) Allocation basis.--If an area vocational education 
        school or educational service agency meets the requirements of 
        paragraph (1), then--
                    (A) the amount that will otherwise be distributed 
                to the local educational agency under this section 
                shall be allocated to the area vocational education 
                school, the educational service agency, and the local 
                educational agency, based on each school's or agency's 
                relative share of students described in paragraph 
                (1)(B)(i) who are attending vocational education 
                programs (based, if practicable, on the average 
                enrollment for the prior 3 years); or
                    (B) such amount may be allocated on the basis of an 
                agreement between the local educational agency and the 
                area vocational education school or educational service 
                agency.
            (3) State determination.--
                    (A) In general.--For the purposes of this 
                subsection, the State educational agency may determine 
                the number of students who are low-income on the basis 
                of--
                            (i) eligibility for--
                                    (I) free or reduced-price meals 
                                under the National School Lunch Act (7 
                                U.S.C. 1751 et seq.);
                                    (II) assistance under a State 
                                program funded under part A of title IV 
                                of the Social Security Act (42 U.S.C. 
                                601 et seq.);
                                    (III) benefits under the Food Stamp 
                                Act of 1977 (7 U.S.C. 2011 et seq.); or
                                    (IV) services under title I of the 
                                Elementary and Secondary Education Act 
                                of 1965 (20 U.S.C. 6301 et seq.); and
                            (ii) another index of economic status, 
                        including an estimate of such index, if the 
                        State educational agency demonstrates to the 
                        satisfaction of the Governing Board that such 
                        index is a more representative means of 
                        determining such number.
                    (B) Data.--If a State educational agency elects to 
                use more than 1 factor described in subparagraph (A) 
                for purposes of making the determination described in 
                such subparagraph, the State educational agency shall 
                ensure that the data used is not duplicative.
            (4) Appeals procedure.--The State educational agency shall 
        establish an appeals procedure for resolution of any dispute 
        arising between a local educational agency and an area 
        vocational education school or an educational service agency 
        with respect to the allocation procedures described in this 
        section, including the decision of a local educational agency 
        to leave a consortium.
            (5) Special rule.--Notwithstanding the provisions of 
        paragraphs (1), (2), (3), and (4), any local educational agency 
        receiving an allocation that is not sufficient to conduct a 
        secondary school vocational education program of sufficient 
        size, scope, and quality to be effective may--
                    (A) form a consortium or enter into a cooperative 
                agreement with an area vocational education school or 
                educational service agency offering secondary school 
                vocational education programs of sufficient size, 
                scope, and quality to be effective and that are 
                accessible to students who are individuals with 
                disabilities or are low-income, and are served by such 
                local educational agency; and
                    (B) transfer such allocation to the area vocational 
                education school or educational service agency.
    (e) Special Rule.--Each State educational agency distributing funds 
under this section shall treat a secondary school funded by the Bureau 
of Indian Affairs within the State as if such school were a local 
educational agency within the State for the purpose of receiving a 
distribution under this section.

SEC. 723. DISTRIBUTION FOR POSTSECONDARY AND ADULT VOCATIONAL 
              EDUCATION.

    (a) Allocation.--
            (1) In general.--Except as provided in subsection (b) and 
        section 725, each State educational agency, using the portion 
        of the funds made available for any program year by such agency 
        for postsecondary and adult vocational education under section 
        721(b)(3)(A)--
                    (A) shall reserve funds to carry out subsection 
                (d); and
                    (B) shall distribute the remainder to eligible 
                institutions or consortia of the institutions within 
                the State.
            (2) Formula.--Each such eligible institution or consortium 
        shall receive an amount for the program year (from funds made 
        available for the corresponding fiscal year, as determined 
        under section 734(c)) from such remainder bears the same 
        relationship to such remainder as the number of individuals who 
        are Pell Grant recipients or recipients of assistance from the 
        Bureau of Indian Affairs and are enrolled in programs offered 
        by such institution or consortium for the preceding fiscal year 
        bears to the number of all such individuals who are enrolled in 
        any such program within the State for such preceding year.
            (3) Consortium requirements.--In order for a consortium of 
        eligible institutions described in paragraph (1) to receive 
        assistance pursuant to such paragraph such consortium shall 
        operate joint projects that--
                    (A) provide services to all postsecondary 
                institutions participating in the consortium; and
                    (B) are of sufficient size, scope, and quality to 
                be effective.
    (b) Waiver for More Equitable Distribution.--The Governing Board 
may waive the application of subsection (a) in the case of any State 
educational agency that submits to the Governing Board an application 
for such a waiver that--
            (1) demonstrates that the formula described in subsection 
        (a) does not result in a distribution of funds to the 
        institutions or consortia within the State that have the 
        highest numbers of low-income individuals and that an 
        alternative formula will result in such a distribution; and
            (2) includes a proposal for an alternative formula that may 
        include criteria relating to the number of individuals 
        attending the institutions or consortia within the State who--
                    (A) receive need-based postsecondary financial aid 
                provided from public funds;
                    (B) are members of families receiving assistance 
                under a State program funded under part A of title IV 
                of the Social Security Act (42 U.S.C. 601 et seq.);
                    (C) are enrolled in postsecondary educational 
                institutions that--
                            (i) are funded by the State;
                            (ii) do not charge tuition; and
                            (iii) serve only low-income students;
                    (D) are enrolled in programs serving low-income 
                adults; or
                    (E) are Pell Grant recipients.
    (c) Minimum Amount.--
            (1) In general.--No distribution of funds provided to any 
        institution or consortium for a program year under this section 
        shall be for an amount that is less than $50,000.
            (2) Redistribution.--Any amounts that are not distributed 
        by reason of paragraph (1) shall be redistributed to eligible 
        institutions or consortia in accordance with the provisions of 
        this section.
    (d) Special Rule for Criminal Offenders.--Each State educational 
agency shall distribute the funds reserved under subsection (a)(1)(A) 
to 1 or more State corrections agencies to enable the State corrections 
agencies to administer vocational education programs for juvenile and 
adult criminal offenders in correctional institutions in the State, 
including correctional institutions operated by local authorities.
    (e) Definition.--For the purposes of this section--
            (1) the term ``eligible institution'' means an institution 
        of higher education, a local educational agency serving adults, 
        or an area vocational education school serving adults that 
        offers or will offer a program that seeks to receive financial 
        assistance under this section;
            (2) the term ``institution of higher education'', 
        notwithstanding section 427(b)(2) of the Higher Education 
        Amendments of 1992 (20 U.S.C. 1085 note), has the meaning given 
        the term in section 435(b) of the Higher Education Act of 1965 
        as such section was in effect on July 22, 1992;
            (3) the term ``low-income'', used with respect to a person, 
        means a person who is determined under guidelines developed by 
        the Governing Board to be low-income, using the most recent 
        available data provided by the Bureau of the Census, prior to 
        the determination; and
            (4) the term ``Pell Grant recipient'' means a recipient of 
        financial aid under subpart 1 of part A of title IV of the 
        Higher Education Act of 1965 (20 U.S.C. 1070a et seq.).

SEC. 724. DISTRIBUTION FOR ADULT EDUCATION.

    (a) In General.--Except as provided in subsection (b)(3), from the 
amount made available by a State educational agency for adult education 
under section 721(b)(3)(B) for a program year, such agency shall award 
grants, on a competitive basis, to local educational agencies, 
correctional education agencies, community-based organizations of 
demonstrated effectiveness, volunteer literacy organizations, public or 
private nonprofit agencies, postsecondary educational institutions, 
public housing authorities, and other nonprofit institutions that have 
the ability to provide literacy services to adults and families, or 
consortia of agencies, organizations, or institutions described in this 
subsection, to enable such agencies, organizations, institutions, and 
consortia to establish or expand adult education programs.
    (b) Grant Requirements.--
            (1) Access.--Each State educational agency making funds 
        available for any program year for adult education under 
        section 721(b)(3)(B) shall ensure that the entities described 
        in subsection (a) will be provided direct and equitable access 
        to all Federal funds provided under this section.
            (2) Considerations.--In awarding grants under this section, 
        the State educational agency shall consider--
                    (A) the past effectiveness of applicants in 
                providing services (especially with respect to 
                recruitment and retention of educationally 
                disadvantaged adults and the learning gains 
                demonstrated by such adults);
                    (B) the degree to which an applicant will 
                coordinate and utilize other literacy and social 
                services available in the community; and
                    (C) the commitment of the applicant to serve 
                individuals in the community who are most in need of 
                literacy services.
            (3) Consortia.--A State educational agency may award a 
        grant under subsection (a) to a consortium that includes an 
        entity described in subsection (a) and a for-profit agency, 
        organization, or institution, if such agency, organization, or 
        institution--
                    (A) can make a significant contribution to carrying 
                out the purposes of this title; and
                    (B) enters into a contract with the entity 
                described in subsection (a) for the purpose of 
                establishing or expanding adult education programs.
    (c) Local Administrative Costs Limits.--
            (1) In general.--Except as provided in paragraph (2), of 
        the funds provided under this section by a State educational 
        agency to an agency, organization, institution, or consortium 
        described in subsection (a), at least 95 percent shall be 
        expended for provision of adult education instructional 
        activities. The remainder shall be used for planning, 
        administration, personnel development, and interagency 
        coordination.
            (2) Special rule.--In cases where the cost limits described 
        in paragraph (1) will be too restrictive to allow for adequate 
        planning, administration, personnel development, and 
        interagency coordination supported under this section, the 
        State educational agency shall negotiate with the agency, 
        organization, institution, or consortium described in 
        subsection (a) in order to determine an adequate level of funds 
        to be used for noninstructional purposes.
SEC. 725. SPECIAL RULE FOR MINIMAL ALLOCATION.

    (a) General Authority.--For any program year for which a minimal 
amount is made available by a State educational agency for distribution 
under section 722 or 723 such agency may, notwithstanding the 
provisions of section 722 or 723, respectively, in order to make a more 
equitable distribution of funds for programs serving the highest 
numbers of low-income individuals (as defined in section 723(e)), 
distribute such minimal amount--
            (1) on a competitive basis; or
            (2) through any alternative method determined by the State 
        educational agency.
    (b) Minimal Amount.--For purposes of this section, the term 
``minimal amount'' means not more than 15 percent of the total amount 
made available by the State educational agency under section 
721(b)(3)(A) for section 722 or 723, respectively, for such program 
year.

SEC. 726. REDISTRIBUTION.

    (a) In General.--In any program year that an entity receiving 
financial assistance under section 722 or 723 does not expend all of 
the amounts distributed to such entity for such year under section 722 
or 723, respectively, such entity shall return any unexpended amounts 
to the State educational agency for distribution under section 722 or 
723, respectively.
    (b) Redistribution of Amounts Returned Late in a Program Year.--In 
any program year in which amounts are returned to the State educational 
agency under subsection (a) for programs described in section 722 or 
723 and the State educational agency is unable to redistribute such 
amounts according to section 722 or 723, respectively, in time for such 
amounts to be expended in such program year, the State educational 
agency shall retain such amounts for distribution in combination with 
amounts provided under such section for the following program year.
SEC. 727. LOCAL APPLICATION FOR WORKFORCE EDUCATION ACTIVITIES.

    (a) In General.--
            (1) In general.--Each eligible entity desiring financial 
        assistance under this subtitle for workforce education 
        activities shall submit an application to the State educational 
        agency at such time, in such manner and accompanied by such 
        information as such agency (in consultation with such other 
        educational entities as the State educational agency determines 
        to be appropriate) may require. Such application shall cover 
        the same period of time as the period of time applicable to the 
        State workforce development plan.
            (2) Definition.--For the purpose of this section the term 
        ``eligible entity'' means an entity eligible for financial 
        assistance under section 722, 723, or 724 from a State 
        educational agency.
    (b) Contents.--Each application described in subsection (a) shall, 
at a minimum--
            (1) describe how the workforce education activities 
        required under section 716(b), and other workforce education 
        activities, will be carried out with funds received under this 
        subtitle;
            (2) describe how the activities to be carried out relate to 
        meeting the State goals, and reaching the State benchmarks, 
        concerning workforce education activities;
            (3) describe how the activities to be carried out are an 
        integral part of the comprehensive efforts of the eligible 
        entity to improve education for all students and adults;
            (4) describe the process that will be used to independently 
        and continuously improve the performance of the eligible 
        entity; and
            (5) describe how the eligible entity will coordinate the 
        activities of the entity with the activities of the local 
        workforce development board, if any, in the substate area.

SEC. 728. LOCAL PARTNERSHIPS, AGREEMENTS, AND WORKFORCE DEVELOPMENT 
              BOARDS.

    (a) Local Agreements.--
            (1) In general.--After a Governor submits the State plan 
        described in section 714 to the Governing Board, the Governor 
        shall negotiate and enter into a local agreement regarding the 
        workforce employment activities, school-to-work activities, and 
        economic development activities (within a State that is 
        eligible to carry out such activities, as described in 
        subsection (c)) to be carried out in each substate area in the 
        State with local partnerships (or, where established, local 
        workforce development boards described in subsection (b)).
            (2) Local partnerships.--
                    (A) In general.--A local partnership referred to in 
                paragraph (1) shall be established by the local chief 
                elected official, in accordance with subparagraphs (B) 
                and (C), and shall consist of individuals representing 
                business, industry, and labor, local secondary schools, 
                local postsecondary education institutions, local adult 
                education providers, local elected officials, 
                rehabilitation agencies and organizations, and 
                community-based organizations, within the appropriate 
                substate area.
                    (B) Multiple jurisdictions.--In any case in which 
                there are 2 or more units of general local government 
                in the substate area involved, the chief elected 
                official of each such unit shall appoint members of the 
                local partnership in accordance with an agreement 
                entered into by such chief elected officials. In the 
                absence of such an agreement, such appointments shall 
                be made by the Governor of the State involved from the 
                individuals nominated or recommended by the chief 
                elected officials.
                    (C) Selection of business and industry 
                representatives.--Individuals representing business and 
                industry in the local partnership shall be appointed by 
                the chief elected official from nominations submitted 
                by business organizations in the substate area 
                involved. Such individuals shall reasonably represent 
                the industrial and demographic composition of the 
                business community. Where possible, at least 50 percent 
                of such business and industry representatives shall be 
                representatives of small business.
            (3) Business and industry involvement.--The business and 
        industry representatives shall have a lead role in the design, 
        management, and evaluation of the activities to be carried out 
        in the substate area under the local agreement.
            (4) Contents.--
                    (A) State goals and state benchmarks.--Such an 
                agreement shall include a description of the manner in 
                which funds allocated to a substate area under this 
                subtitle will be spent to meet the State goals and 
                reach the State benchmarks in a manner that reflects 
                local labor market conditions.
                    (B) Collaboration.--The agreement shall also 
                include information that demonstrates the manner in 
                which--
                            (i) the Governor; and
                            (ii) the local partnership (or, where 
                        established, the local workforce development 
                        board);
                collaborated in reaching the agreement.
            (5) Failure to reach agreement.--If, after a reasonable 
        effort, the Governor is unable to enter into an agreement with 
        the local partnership (or, where established, the local 
        workforce development board), the Governor shall notify the 
        partnership or board, as appropriate, and provide the 
        partnership or board, as appropriate, with the opportunity to 
        comment, not later than 30 days after the date of the 
        notification, on the manner in which funds allocated to such 
        substate area will be spent to meet the State goals and reach 
        the State benchmarks.
            (6) Exception.--A State that indicates in the State plan 
        described in section 714 that the State will be treated as a 
        substate area for purposes of the application of this subtitle 
        shall not be subject to this subsection.
    (b) Local Workforce Development Boards.--
            (1) In general.--Each State may facilitate the 
        establishment of local workforce development boards in each 
        substate area to set policy and provide oversight over the 
        workforce development activities in the substate area.
            (2) Membership.--
                    (A) State criteria.--The Governor shall establish 
                criteria for use by local chief elected officials in 
                each substate area in the selection of members of the 
                local workforce development boards, in accordance with 
                the requirements of subparagraph (B).
                    (B) Representation requirement.--Such criteria 
                shall require, at a minimum, that a local workforce 
                development board consist of--
                            (i) representatives of business and 
                        industry in the substate area, who shall 
                        constitute a majority of the board;
                            (ii) representatives of labor, workers, and 
                        community-based organizations, who shall 
                        constitute not less than 25 percent of the 
                        members of the board;
                            (iii) representatives of local secondary 
                        schools, postsecondary education institutions, 
                        and adult education providers;
                            (iv) representatives of veterans; and
                            (v) 1 or more individuals with 
                        disabilities, or their representatives.
                    (C) Chair.--Each local workforce development board 
                shall select a chairperson from among the members of 
                the board who are representatives of business and 
                industry.
            (3) Conflict of interest.--No member of a local workforce 
        development board shall vote on a matter relating to the 
        provision of services by the member (or any organization that 
        the member directly represents) or vote on a matter that would 
        provide direct financial benefit to such member or the 
        immediate family of such member or engage in any other activity 
        determined by the Governor to constitute a conflict of 
        interest.
            (4) Functions.--The functions of the local workforce 
        development board shall include--
                    (A) submitting to the Governor a single 
                comprehensive 3-year strategic plan for workforce 
                development activities in the substate area that 
                includes information--
                            (i) identifying the workforce development 
                        needs of local industries, students, 
                        jobseekers, and workers;
                            (ii) identifying the workforce development 
                        activities to be carried out in the substate 
                        area with funds received through the allotment 
                        made to the State under section 712, to meet 
                        the State goals and reach the State benchmarks; 
                        and
                            (iii) identifying how the local workforce 
                        development board will obtain the active and 
                        continuous participation of business, industry, 
                        and labor in the development and continuous 
                        improvement of the workforce development 
                        activities carried out in the substate area;
                    (B) entering into local agreements with the 
                Governor as described in subsection (a);
                    (C) overseeing the operations of the one-stop 
                delivery of core services described in section 
                716(a)(2) in the substate area, including the 
                responsibility to--
                            (i) designate local entities to operate the 
                        one-stop delivery in the substate area, 
                        consistent with the criteria referred to in 
                        section 716(a)(2); and
                            (ii) develop and approve the budgets and 
                        annual operating plans of the providers of the 
                        one-stop delivery; and
                    (D) submitting annual reports to the Governor on 
                the progress being made in the substate area toward 
                meeting the State goals and reaching the State 
                benchmarks.
            (5) Consultation.--A local workforce development board that 
        serves a substate area shall conduct the functions described in 
        paragraph (4) in consultation with the chief elected officials 
        in the substate area.
    (c) Economic Development Activities.--A State shall be eligible to 
use the funds made available through the flex account for flexible 
workforce activities to carry out economic development activities if--
            (1) the boards described in section 715 and subsection (b) 
        are established in the State; or
            (2) in the case of a State that indicates in the State plan 
        described in section 714 that the State will be treated as a 
        substate area for purposes of the application of this subtitle, 
        the board described in section 715 is established in the State.

                       CHAPTER 3--ADMINISTRATION

SEC. 731. ACCOUNTABILITY.

    (a) Report.--
            (1) In general.--Each State that receives an allotment 
        under section 712 shall annually prepare and submit to the 
        Governing Board a report that states how the State is 
        performing on State benchmarks specified in this section, which 
        relate to workforce development activities carried out through 
        the statewide system of the State. In preparing the report, the 
        State may include information on such additional benchmarks as 
        the State may establish to meet the State goals.
            (2) Consolidated report.--In lieu of submitting separate 
        reports under paragraph (1) and section 409(a) of the Social 
        Security Act, the State may prepare a consolidated report. Any 
        consolidated report prepared under this paragraph shall contain 
        the information described in paragraph (1) and subsections (a) 
        through (h) of section 409 of the Social Security Act. The 
        State shall submit any consolidated report prepared under this 
        paragraph to the Governing Board, the Secretary of Agriculture, 
        and the Secretary of Health and Human Services, on the
         dates specified in section 409(a) of the Social Security Act.
    (b) Goals.--
            (1) Meaningful employment.--Each statewide system supported 
        by an allotment under section 712 shall be designed to meet the 
        goal of assisting participants in obtaining meaningful 
        unsubsidized employment opportunities in the State.
            (2) Education.--Each statewide system supported by an 
        allotment under section 712 shall be designed to meet the goal 
        of enhancing and developing more fully the academic, 
        occupational, and literacy skills of all segments of the 
        population of the State.
    (c) Benchmarks.--
            (1) Meaningful employment.--To be eligible to receive an 
        allotment under section 712, a State shall develop, in 
        accordance with paragraph (5), and identify in the State plan 
        of the State, proposed quantifiable benchmarks to measure the 
        statewide progress of the State toward meeting the goal 
        described in subsection (b)(1), which shall include, at a 
        minimum, measures of--
                    (A) placement in unsubsidized employment of 
                participants;
                    (B) retention of the participants in such 
                employment (12 months after completion of the 
                participation); and
                    (C) increased earnings for the participants.
            (2) Education.--To be eligible to receive an allotment 
        under section 712, a State shall develop, in accordance with 
        paragraph (5), and identify in the State plan of the State, 
        proposed quantifiable benchmarks to measure the statewide 
        progress of the State toward meeting the goal described in 
        subsection (b)(2), which shall include, at a minimum, measures 
        of--
                    (A) student mastery of academic knowledge and work 
                readiness skills;
                    (B) student mastery of occupational and industry-
                recognized skills according to skill proficiencies for 
                students in career preparation programs;
                    (C) placement in, retention in, and completion of 
                secondary education (as determined under State law) and 
                postsecondary education, and placement and retention in 
                employment and in military service; and
                    (D) mastery of the literacy, knowledge, and skills 
                adults need to be productive and responsible citizens 
                and to become more actively involved in the education 
                of their children.
            (3) Populations.--To be eligible to receive an allotment 
        under section 712, a State shall develop, in accordance with 
        paragraph (5), and identify in the State plan of the State, 
        proposed quantifiable benchmarks to measure progress toward 
        meeting the goals described in subsection (b) for populations 
        including, at a minimum--
                    (A) welfare recipients (including a benchmark for 
                welfare recipients described in section 3(34)(B));
                    (B) individuals with disabilities;
                    (C) older workers;
                    (D) at-risk youth; and
                    (E) dislocated workers.
            (4) Special rule.--If a State has developed performance 
        indicators, attainment levels, or assessments for skills 
        according to challenging academic, occupational, or industry-
        recognized skill proficiencies, the State shall use such 
        performance indicators, attainment levels, or assessments in 
        measuring the progress of all students in attaining the skills.
            (5) Negotiations.--
                    (A) Initial determination.--On receipt of a State 
                plan submitted under section 714, the Governing Board 
                shall, not later than 30 days after the date of the 
                receipt, determine--
                            (i) how the proposed State benchmarks 
                        identified by the State in the State plan 
                        compare to the model benchmarks established by 
                        the Governing Board under section 
                        771(b)(4)(B)(ii);
                            (ii) how the proposed State benchmarks 
                        compare with State benchmarks proposed by other 
                        States in their State plans; and
                            (iii) whether the proposed State 
                        benchmarks, taken as a whole, are sufficient--
                                    (I) to enable the State to meet the 
                                State goals; and
                                    (II) to make the State eligible for 
                                an incentive grant under section 
                                732(a).
                    (B) Notification.--The Governing Board shall 
                immediately notify the State of the determinations 
                referred to in subparagraph (A). If the Governing Board 
                determines that the proposed State benchmarks are not 
                sufficient to make the State eligible for an incentive 
                grant under section 732(a), the Governing Board shall 
                provide the State with guidance on the steps the State 
                may take to allow the State to become eligible for the 
                grant.
                    (C) Revision.--Not later than 30 days after the 
                date of receipt of the notification referred to in 
                subparagraph (B), the State may revise some or all of 
                the State benchmarks identified in the State plan in 
                order to become eligible for the incentive grant or 
                provide reasons why the State benchmarks should be 
                sufficient to make the State eligible for the incentive 
                grant.
                    (D) Final determination.--After reviewing any 
                revised State benchmarks or information submitted by 
                the State in accordance with subparagraph (C), the 
                Governing Board shall issue a final determination on 
                the eligibility of the State for the incentive grant.
            (6) Incentive grants.--Each State that sets high benchmarks 
        under paragraph (1), (2), or (3) and reaches or exceeds the 
        benchmarks, as determined by the Governing Board, shall be 
        eligible to receive an incentive grant under section 732(a).
            (7) Sanctions.--A State that has failed to demonstrate 
        sufficient progress toward reaching the State benchmarks 
        established under this subsection for the 3 years covered by a 
        State plan described in section 714, as determined by the 
        Governing Board, may be subject to sanctions under section 
        732(b).
    (d) Job Placement Accountability System.--
            (1) In general.--Each State that receives an allotment 
        under section 712 shall establish a job placement 
        accountability system, which will provide a uniform set of data 
        to track the progress of the State toward reaching the State 
        benchmarks.
            (2) Data.--
                    (A) In general.--In order to maintain data relating 
                to the measures described in subsection (c)(1), each 
                such State shall establish a job placement 
                accountability system using quarterly wage records 
                available through the unemployment insurance system. 
                The State agency or entity within the State responsible 
                for labor market information, as designated in section 
                773(c)(1)(B), in conjunction with the Commissioner of 
                Labor Statistics, shall maintain the
                 job placement accountability system and match 
information on participants served by the statewide systems of the 
State and other States with quarterly employment and earnings records.
                    (B) Reimbursement.--Each local entity that carries 
                out workforce employment activities or workforce 
                education activities and that receives funds under this 
                subtitle shall provide information regarding the social 
                security numbers of the participants served by the 
                entity and such other information as the State may 
                require to the State agency or entity within the State 
                responsible for labor market information, as designated 
                in section 773(c)(1)(B).
                    (C) Confidentiality.--The State agency or entity 
                within the State responsible for labor market 
                information, as designated in section 773(c)(1)(B), 
                shall protect the confidentiality of information 
                obtained through the job placement accountability 
                system through the use of recognized security 
                procedures.
    (e) Individual Accountability.--Each State that receives an 
allotment under section 712 shall devise and implement procedures to 
provide, in a timely manner, information on participants in activities 
carried out through the statewide system who are participating as a 
condition of receiving welfare assistance. The procedures shall require 
that the State provide the information to the State and local agencies 
carrying out the programs through which the welfare assistance is 
provided, in a manner that ensures that the agencies can monitor 
compliance with the conditions regarding the receipt of the welfare 
assistance.

SEC. 732. INCENTIVES AND SANCTIONS.

    (a) Incentives.--
            (1) In general.--The Governing Board may award incentive 
        grants of not more than $15,000,000 per program year to a State 
        that--
                    (A) reaches or exceeds State benchmarks established 
                under section 731(c), with an emphasis on the 
                benchmarks established under section 731(c)(3), in 
                accordance with section 731(c)(6); or
                    (B) demonstrates to the Governing Board that the 
                State has made substantial reductions in the number of 
                adult recipients of assistance, as defined in section 
                712(b)(1)(A), resulting from increased placement of 
                such adult recipients of assistance.
            (2) Use of funds.--A State that receives such a grant may 
        use the funds made available through the grant to carry out any 
        workforce development activities authorized under this title.
    (b) Sanctions.--
            (1) Failure to demonstrate sufficient progress.--If the 
        Governing Board determines, after notice and an opportunity for 
        a hearing, that a State has failed to demonstrate sufficient 
        progress toward reaching the State benchmarks established under 
        section 731(c) for the 3 years covered by a State plan 
        described in section 714, the Governing Board may reduce the 
        allotment of the State under section 712 by not more than 10 
        percent per program year for not more than 3 years. The 
        Governing Board may determine that the failure of the State to 
        demonstrate such progress is attributable to the workforce 
        employment activities, workforce education activities, or 
        flexible workforce activities, of the State, and reduce only 
        the portion of the allotment for such activities.
            (2) Expenditure contrary to title.--If the Governor of a 
        State determines that a local entity that carries out workforce 
        employment activities in a substate area of the State has 
        expended funds made available under this title in a manner 
        contrary to the purposes of this title, and such expenditures 
        do not constitute fraudulent activity, the Governor may deduct 
        an amount equal to the funds from a subsequent program year 
        allocation to the substate area.
    (c) Funds Resulting From Reduced Allotments.--The Governing Board 
may use an amount retained as a result of a reduction in an allotment 
made under subsection (b)(1) to award an incentive grant under 
subsection (a).

SEC. 733. UNEMPLOYMENT TRUST FUND.

    (a) In General.--Section 901(c) of the Social Security Act (42 
U.S.C. 1101(c)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A), by striking clause (ii) 
                and inserting the following:
                            ``(ii) the establishment and maintenance of 
                        statewide workforce development systems, to the 
                        extent the systems are used to carry out 
                        activities described in section 773, or in any 
                        of clauses (ii) through (v) of section 
                        716(a)(2)(B), of the Workforce Development Act 
                        of 1995, and''; and
                    (B) in subparagraph (B)--
                            (i) in the matter preceding clause (i), by 
                        striking ``Department of Labor'' and inserting 
                        ``Department of Labor or the Workforce 
                        Development Partnership, as appropriate,''; and
                            (ii) by striking clause (iii) and inserting 
                        the following:
                            ``(iii) the Workforce Development Act of 
                        1995,''; and
            (2) in the first sentence of paragraph (4), by striking 
        ``the total cost'' and all that follows through ``the President 
        determines'' and inserting ``the total cost of administering 
        the statewide workforce development systems, to the extent the 
        systems are used to carry out activities described in section 
        773, or in any of clauses (ii) through (v) of section 
        716(a)(2)(B), of the Workforce Development Act of 1995, and of 
        the necessary expenses of the Workforce Development Partnership 
        for the performance of the functions of the partnership under 
        such Act, as the President determines''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect July 1, 1998.

SEC. 734. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--There are authorized to be appropriated to carry 
out this title (other than subtitle C) $6,127,000,000 for each of 
fiscal years 1998 through 2001.
    (b) Reservations.--Of the amount appropriated under subsection 
(a)--
            (1) 92.7 percent shall be reserved for making allotments 
        under section 712;
            (2) 1.25 percent shall be reserved for carrying out section 
        717;
            (3) 0.2 percent shall be reserved for carrying out section 
        718;
            (4) 4.3 percent shall be reserved for making incentive 
        grants under section 732(a) and for the administration of this 
        title;
            (5) 0.15 percent shall be reserved for carrying out 
        sections 772 and 774; and
            (6) 1.4 percent shall be reserved for carrying out section 
        773.
    (c) Program Year.--
            (1) In general.--Appropriations for any fiscal year for 
        programs and activities under this title shall be available for 
        obligation only on the basis of a program year. The program 
        year shall begin on July 1 in the fiscal year for which the 
        appropriation is made.
            (2) Administration.--Funds obligated for any program year 
        may be expended by each recipient during the program year and 
        the 2 succeeding program years and no amount shall be 
        deobligated on account of a rate of expenditure that is 
        consistent with the provisions of the State plan specified in 
        section 714 that relate to workforce employment activities.

SEC. 735. EFFECTIVE DATE.

    This subtitle shall take effect July 1, 1998.
 Subtitle C--Job Corps and Other Workforce Preparation Activities for 
                             At-Risk Youth

                CHAPTER 1--GENERAL JOB CORPS PROVISIONS

SEC. 741. PURPOSES.

    The purposes of this subtitle are--
            (1) to maintain a Job Corps for at-risk youth as part of 
        statewide systems;
            (2) to set forth standards and procedures for selecting 
        individuals as enrollees in the Job Corps;
            (3) to authorize the establishment of residential and 
        nonresidential Job Corps centers in which enrollees will 
        participate in intensive programs of workforce development 
        activities;
            (4) to prescribe various other powers, duties, and 
        responsibilities incident to the operation and continuing 
        development of the Job Corps; and
            (5) to assist at-risk youth who need and can benefit from 
        an unusually intensive program, operated in a group setting, to 
        become more responsible, employable, and productive citizens.

SEC. 742. DEFINITIONS.

    As used in this subtitle:
            (1) Enrollee.--The term ``enrollee'' means an individual 
        enrolled in the Job Corps.
            (2) Governor.--The term ``Governor'' means the chief 
        executive officer of a State.
            (3) Job corps.--The term ``Job Corps'' means the corps 
        described in section 743.
            (4) Job corps center.--The term ``Job Corps center'' means 
        a center described in section 743.
SEC. 743. GENERAL AUTHORITY.

    If a State receives an allotment under section 759, and a center 
located in the State received assistance under part B of title IV of 
the Job Training Partnership Act for fiscal year 1996 and was not 
closed in accordance with section 755, the State shall use a portion of 
the funds made available through the allotment to maintain the center, 
and carry out activities described in this subtitle for individuals 
enrolled in a Job Corps and assigned to the center.

SEC. 744. INDIVIDUALS ELIGIBLE FOR THE JOB CORPS.

    To be eligible to become an enrollee, an individual shall be an at-
risk youth.

SEC. 745. SCREENING AND SELECTION OF APPLICANTS.

    (a) Standards and Procedures.--
            (1) In general.--The State shall prescribe specific 
        standards and procedures for the screening and selection of 
        applicants for the Job Corps.
            (2) Implementation.--To the extent practicable, the 
        standards and procedures shall be implemented through 
        arrangements with--
                    (A) one-stop career centers;
                    (B) agencies and organizations such as community 
                action agencies, professional groups, and labor 
                organizations; and
                    (C) agencies and individuals that have contact with 
                youth over substantial periods of time and are able to 
                offer reliable information about the needs and problems 
                of the youth.
            (3) Consultation.--The standards and procedures shall 
        provide for necessary consultation with individuals and 
        organizations, including court, probation, parole, law 
        enforcement, education, welfare, and medical authorities and 
        advisers.
    (b) Special Limitations.--No individual shall be selected as an 
enrollee unless the individual or organization implementing the 
standards and procedures determines that--
            (1) there is a reasonable expectation that the individual 
        can participate successfully in group situations and 
        activities, is not likely to engage in behavior that would 
        prevent other enrollees from receiving the benefit of the 
        program or be incompatible with the maintenance of sound 
        discipline and satisfactory relationships between the Job Corps 
        center to which the individual might be assigned and 
        surrounding communities; and
            (2) the individual manifests a basic understanding of both 
        the rules to which the individual will be subject and of the 
        consequences of failure to observe the rules.

SEC. 746. ENROLLMENT AND ASSIGNMENT.

    (a) Relationship Between Enrollment and Military Obligations.--
Enrollment in the Job Corps shall not relieve any individual of 
obligations under the Military Selective Service Act (50 U.S.C. App. 
451 et seq.).
    (b) Assignment.--
            (1) In general.--Except as provided in paragraph (2), the 
        State shall assign an enrollee to the Job Corps center within 
        the State that is closest to the residence of the enrollee.
            (2) Agreements with other states.--The State may enter into 
        agreements with 1 or more States to enroll individuals from the 
        States in the Job Corps and assign the enrollees to Job Corps 
        centers in the State.

SEC. 747. JOB CORPS CENTERS.

    (a) Development.--The State shall enter into an agreement with a 
Federal, State, or local agency, which may be a State board or agency 
that operates or wishes to develop an area vocational education school 
facility or residential vocational school, or with a private 
organization, for the establishment and operation of a Job Corps 
center.
    (b) Character and Activities.--Job Corps centers may be residential 
or nonresidential in character, and shall be designed and operated so 
as to provide enrollees, in a well-supervised setting, with access to 
activities described in section 748.
    (c) Civilian Conservation Centers.--The Job Corps centers may 
include Civilian Conservation Centers, located primarily in rural 
areas, which shall provide, in addition to other training and 
assistance, programs of work experience to conserve, develop, or manage 
public natural resources or public recreational areas or to develop 
community projects in the public interest.
    (d) Job Corps Operators.--To be eligible to receive funds under 
this chapter, an entity who entered into a contract with the Secretary 
of Labor that is in effect
 on the effective date of this section to carry out activities through 
a center under part B of title IV of the Job Training Partnership Act 
(as in effect on the day before the effective date of this section), 
shall enter into a contract with the State in which the center is 
located that contains provisions substantially similar to the 
provisions of the contract with the Secretary of Labor, as determined 
by the State.

SEC. 748. PROGRAM ACTIVITIES.

    (a) Activities Provided Through Job Corps Centers.--Each Job Corps 
center shall provide enrollees assigned to the center with access to 
activities described in section 716(a)(2)(B), and such other workforce 
development activities as may be appropriate to meet the needs of the
 enrollees, including providing work-based learning throughout the 
enrollment of the enrollees and assisting the enrollees in obtaining 
meaningful unsubsidized employment on completion of their enrollment.
    (b) Arrangements.--The State shall arrange for enrollees assigned 
to Job Corps centers in the State to receive workforce development 
activities through the statewide system, including workforce 
development activities provided through local public or private 
educational agencies, vocational educational institutions, or technical 
institutes.
    (c) Job Placement Accountability.--Each Job Corps center located in 
a State shall be connected to the job placement accountability system 
of the State described in section 731(d).

SEC. 749. SUPPORT.

    The State shall provide enrollees assigned to Job Corps centers in 
the State with such personal allowances as the State may determine to 
be necessary or appropriate to meet the needs of the enrollees.

SEC. 750. OPERATING PLAN.

    To be eligible to operate a Job Corps center and receive assistance 
under section 759 for program year 1998 or any subsequent program year, 
an entity shall prepare and submit, to the Governor of the State in 
which the center is located, and obtain the approval of the Governor 
for, an operating plan that shall include, at a minimum, information 
indicating--
            (1) in quantifiable terms, the extent to which the center 
        will contribute to the achievement of the proposed State goals 
        and State benchmarks identified in the State plan for the State 
        submitted under section 714;
            (2) the extent to which workforce employment activities and 
        workforce education activities delivered through the Job Corps 
        center are directly linked to the workforce development needs 
        of the industry sectors most important to the economic 
        competitiveness of the State; and
            (3) an implementation strategy to ensure that all enrollees 
        assigned to the Job Corps center will have access to services 
        through the one-stop delivery of core services described in 
        section 716(a)(2) by the State.

SEC. 751. STANDARDS OF CONDUCT.

    (a) Provision and Enforcement.--The State shall provide, and 
directors of Job Corps center shall stringently enforce, standards of 
conduct within the centers. Such standards of conduct shall include 
provisions forbidding violence, drug abuse, and other criminal 
activity.
    (b) Disciplinary Measures.--To promote the proper moral and 
disciplinary conditions in the Job Corps, the directors of Job Corps 
centers shall take appropriate disciplinary measures against enrollees. 
If such a director determines that an enrollee has committed a 
violation of the standards of conduct, the director shall dismiss the 
enrollee from the Corps if the director determines that the retention 
of the enrollee in the Corps will jeopardize the enforcement of such 
standards or diminish the opportunities of other enrollees. If the 
director determines that an enrollee has engaged in an incident 
involving violence, drug abuse, or other criminal activity, the 
director shall immediately dismiss the enrollee from the Corps.
    (c) Appeal.--A disciplinary measure taken by a director under this 
section shall be subject to expeditious appeal in accordance with 
procedures established by the State.

SEC. 752. COMMUNITY PARTICIPATION.

    The State shall encourage and cooperate in activities to establish 
a mutually beneficial relationship between Job Corps centers in the 
State and nearby communities. The activities may include the use of any 
local workforce development boards established in the State under 
section 728(b) to provide a mechanism for joint discussion of common 
problems and for planning programs of mutual interest.

SEC. 753. COUNSELING AND PLACEMENT.

    The State shall ensure that enrollees assigned to Job Corps centers 
in the State receive counseling and job placement services, which shall 
be provided, to the maximum extent practicable, through the delivery of 
core services described in section 716(a)(2).

SEC. 754. LEASES AND SALES OF CENTERS.

    (a) Leases.--
            (1) In general.--The Secretary of Labor shall offer to 
        enter into a lease with each State that has an approved State 
        plan submitted under section 714 and in which 1 or more Job 
        Corps centers are located.
            (2) Nominal consideration.--Under the terms of the lease, 
        the Secretary of Labor shall lease the Job Corps centers in the 
        State to the State in return for nominal consideration.
            (3) Indemnity agreement.--To be eligible to lease such a 
        center, a State shall enter into an agreement to hold harmless 
        and indemnify the United States from any liability or claim for 
        damages or injury to any person or property arising out of the 
        lease.
    (b) Sales.--Notwithstanding the Federal Property and Administrative 
Services Act of 1949 (40 U.S.C. 471 et seq.), the Secretary of Labor 
shall offer each State described in subsection (a)(1) the opportunity 
to purchase the Job Corps centers in the State in return for nominal 
consideration.
SEC. 755. CLOSURE OF JOB CORPS CENTERS.

    (a) National Job Corps Audit.--Not later than March 31, 1997, the 
Governing Board shall conduct an audit of the activities carried out 
under part B of title IV of the Job Training Partnership Act (29 U.S.C. 
1691 et seq.), and submit to the appropriate committees of Congress a 
report containing the results of the audit, including information 
indicating--
            (1) the amount of funds expended for fiscal year 1996 to 
        carry out activities under such part, for each State and for 
        the United States;
            (2) for each Job Corps center funded under such part 
        (referred to in this subtitle as a ``Job Corps center''), the 
        amount of funds expended for fiscal year 1996 under such part 
        to carry out activities related to the direct operation of the 
        center, including funds expended for student training, outreach 
        or intake activities, meals and lodging, student allowances, 
        medical care, placement or settlement activities, and 
        administration;
            (3) for each Job Corps center, the amount of funds expended 
        for fiscal year 1996 under such part through contracts to carry 
        out activities not related to the direct operation of the 
        center, including funds expended for student travel, national 
        outreach, screening, and placement services, national 
        vocational training, and national and regional administrative 
        costs;
            (4) for each Job Corps center, the amount of funds expended 
        for fiscal year 1996 under such part for facility construction, 
        rehabilitation, and acquisition expenses; and
            (5) the amount of funds required to be expended under such 
        part to complete each new or proposed Job Corps center, and to 
        rehabilitate and repair each existing Job Corps center, as of 
        the date of the submission of the report.
    (b) Recommendations of Governing Board.--
            (1) Recommendations.--The Governing Board shall, based on 
        the results of the audit described in subsection (a), make 
        recommendations to the Secretary of Labor, including 
        identifying 25 Job Corps centers to be closed by September 30, 
        1997.
            (2) Considerations.--
                    (A) In general.--In determining whether to 
                recommend that the Secretary of Labor close a Job Corps 
                center, the Governing Board shall consider whether the 
                center--
                            (i) has consistently received low 
                        performance measurement ratings under the 
                        Department of Labor or the Office of Inspector 
                        General Job Corps rating system;
                            (ii) is among the centers that have 
                        experienced the highest number of serious 
                        incidents of violence or criminal activity in 
                        the past 5 years;
                            (iii) is among the centers that require the 
                        largest funding for renovation or repair, as 
                        specified in the Department of Labor Job Corps 
                        Construction/Rehabilitation Funding Needs 
                        Survey, or for rehabilitation or repair, as 
                        reflected in the portion of the audit described 
                        in subsection (a)(5);
                            (iv) is among the centers for which the 
                        highest relative or absolute fiscal year 1996 
                        expenditures were made, for any of the 
                        categories of expenditures described in 
                        paragraph (2), (3), or (4) of subsection (a), 
                        as reflected in the audit described in 
                        subsection (a);
                            (v) is among the centers with the least 
                        State and local support; or
                            (vi) is among the centers with the lowest 
                        rating on such additional criteria as the 
                        Governing Board may determine to be 
                        appropriate.
                    (B) Coverage of states and regions.--
                Notwithstanding subparagraph (A), the Governing Board 
                shall not recommend that the Secretary of Labor close 
                the only Job Corps center in a State or a region of the 
                United States.
                    (C) Allowance for new job corps centers.--
                Notwithstanding any other provision of this section, if 
                the planning or construction of a Job Corps center that 
                received Federal funding for fiscal year 1994 or 1995 
                has not been completed by the date of enactment of this 
                Act--
                            (i) the appropriate entity may complete the 
                        planning or construction and begin operation of 
                        the center; and
                            (ii) the Governing Board shall not evaluate 
                        the center under this title sooner than 3 years 
                        after the first date of operation of the 
                        center.
            (3)  Report.--Not later than June 30, 1997, the Governing 
        Board shall submit a report to the Secretary of Labor, which 
        shall contain a detailed statement of the findings and 
        conclusions of the Governing Board resulting from the audit 
        described in subsection (a) together with the recommendations 
        described in paragraph (1).
    (c) Closure.--The Secretary of Labor shall, after reviewing the 
report submitted under subsection (b)(3), close 25 Job Corps centers by 
September 30, 1997.

SEC. 756. INTERIM OPERATING PLANS FOR JOB CORPS CENTERS.

    Part B of title IV of the Job Training Partnership Act (29 U.S.C. 
1691 et seq.) is amended by inserting after section 439 the following 
section:

``SEC. 439A. OPERATING PLAN.

    ``(a) Submission of Plan.--To be eligible to operate a Job Corps 
center and receive assistance under this part for fiscal year 1997, an 
entity shall prepare and submit to the Secretary and the Governor of 
the State in which the center is located, and obtain the approval of 
the Secretary for, an operating plan that shall include, at a minimum, 
information indicating--
            ``(1) in quantifiable terms, the extent to which the center 
        will contribute to the achievement of the proposed State goals 
        and State benchmarks identified in the interim plan for the 
        State submitted under section 762 of the Workforce Development 
        Act of 1995;
            ``(2) the extent to which workforce employment activities 
        and workforce education activities delivered through the Job 
        Corps center are directly linked to the workforce development 
        needs of the industry sectors most important to the economic 
        competitiveness of the State; and
            ``(3) an implementation strategy to ensure that all 
        enrollees assigned to the Job Corps center will have access to 
        services through the one-stop delivery of core services 
        described in section 716(a)(2) by the State as identified in 
        the interim plan.
    ``(b) Submission of Comments.--Not later than 30 days after 
receiving an operating plan described in subsection (a), the Governor 
of the State in which the center is located may submit comments on the 
plan to the Secretary.
    ``(c) Approval.--The Secretary shall not approve an operating plan 
described in subsection (a) for a center if the Secretary determines 
that the activities proposed to be carried out through the center are 
not sufficiently integrated with the activities carried out through the 
statewide system of the State in which the center is located.''.

SEC. 757. EFFECTIVE DATE.

    (a) In General.--Except as provided in subsection (b), this chapter 
shall take effect on July 1, 1998.
    (b) Interim Provisions.--Sections 754 and 755, and the amendment 
made by section 756, shall take effect on the date of enactment of this 
Act.

  CHAPTER 2--OTHER WORKFORCE PREPARATION ACTIVITIES FOR AT-RISK YOUTH

SEC. 759. WORKFORCE PREPARATION ACTIVITIES FOR AT-RISK YOUTH.

    (a) In General.--For program year 1998 and each subsequent program 
year, the Governing Board shall make allotments under subsection (c) to 
States to assist the States in paying for the cost of carrying out 
workforce preparation activities for at-risk youth, as described in 
this section.
    (b) State Use of Funds.--
            (1) Core activities.--The State shall use a portion of the 
        funds made available to the State through an allotment received 
        under subsection (c) to establish and operate Job Corps centers 
        as described in chapter 1, if a center located in the State 
        received assistance under part B of title IV of the Job 
        Training Partnership Act for fiscal year 1996 and was not 
        closed in accordance with section 755.
            (2) Permissible activities.--The State may use a portion of 
        the funds described in paragraph (1) to--
                    (A) make grants to eligible entities, as described 
                in subsection (e), to assist the entities in carrying 
                out innovative programs to assist out-of-school at-risk 
                youth in participating in school-to-work activities;
                    (B) make grants to eligible entities, as described 
                in subsection (e), to assist the entities in providing 
                work-based learning as a component of school-to-work 
                activities, including summer jobs linked to year-round 
                school-to-work programs; and
                    (C) carry out other workforce development 
                activities specifically for at-risk youth.
    (c) Allotments.--
            (1) In general.--The Governing Board shall allot to each 
        State an amount equal to the total of--
                    (A) the amount made available to the State under 
                paragraph (2); and
                    (B) the amounts made available to the State under 
                subparagraphs (C), (D), and (E) of paragraph (3).
            (2) Allotments based on fiscal year 1996 appropriations.--
        Using a portion of the funds appropriated under subsection (g) 
        for a fiscal year, the Governing Board shall make available to 
        each State the amount that Job Corps centers in the State 
        expended for fiscal year 1996 under part B of title IV of the 
        Job Training Partnership Act to carry out activities related to 
        the direct operation of the centers, as determined under 
        section 755(a)(2).
            (3) Allotments based on populations.--
                    (A) Definitions.--As used in this paragraph:
                            (i) Individual in poverty.--The term 
                        ``individual in poverty'' means an individual 
                        who--
                                    (I) is not less than age 18;
                                    (II) is not more than age 64; and
                                    (III) is a member of a family (of 1 
                                or more members) with an income at or 
                                below the poverty line.
                            (ii) Poverty line.--The term ``poverty 
                        line'' means the poverty line (as defined by 
                        the Office of Management and Budget, and 
                        revised annually in accordance with section 
                        673(2) of the Community Services Block Grant 
                        Act (42 U.S.C. 9902(2)) applicable to a family 
                        of the size involved, using the most recent 
                        available data provided by the Bureau of the 
                        Census, prior to the program year for which the 
                        allotment is made, and applying the definition 
                        of poverty used by the Bureau of the Census in 
                        compiling the 1990 decennial census.
                    (B) Total allotments.--The Governing Board shall 
                use the remainder of the funds that are appropriated 
                under subsection (g) for a fiscal year, and that are 
                not made available under paragraph (2), to make amounts 
                available under this paragraph.
                    (C) Unemployed individuals.--From funds equal to 
                33\1/3\ percent of such remainder, the Governing Board 
                shall make available to each State an amount that bears 
                the same relationship to such funds as the average 
                number of unemployed individuals (as determined by the 
                Secretary of Labor for the most recent 24-month period 
                for which data are available, prior to the program year 
                for which the allotment is made) in the State bears to 
                the average number of unemployed individuals (as so 
                determined) in the United States.
                    (D) Individuals in poverty.--From funds equal to 
                33\1/3\ percent of such remainder, the Governing Board 
                shall make available to each State an amount that bears 
                the same relationship to such funds as the total number 
                of individuals in poverty in the State bears to the 
                total number of individuals in poverty in the United 
                States.
                    (E) At-risk youth.--From funds equal to 33\1/3\ 
                percent of such remainder, the Governing Board shall 
                make available to each State an amount that bears the 
                same relationship to such funds as the total number of 
                at-risk youth in the State bears to the total number of 
                at-risk youth in the United States.
    (d) State Plan.--
            (1) Information.--To be eligible to receive an allotment 
        under subsection (c), a State shall include, in the State plan 
        to be submitted under section 714, information describing the 
        allocation within the State of the funds made available through 
        the allotment, and how the programs and activities described
         in subsection (b)(2) will be carried out to meet the State 
goals and reach the State benchmarks.
            (2) Limitation.--The Governing Board may not require a 
        State to include the information described in paragraph (1) in 
        the State plan to be submitted under section 714 to be eligible 
        to receive an allotment under section 712.
    (e) Application.--To be eligible to receive a grant under 
subparagraph (A) or (B) of subsection (b)(2) from a State, an entity 
shall prepare and submit to the Governor of the State an application at 
such time, in such manner, and containing such information as the 
Governor may require.
    (f) Within State Distribution.--Of the funds allotted to a State 
under subsection (c)(3) for workforce preparation activities for at-
risk youth for a program year--
            (1) 15 percent shall be reserved by the Governor to carry 
        out such activities through the statewide system; and
            (2) 85 percent shall be distributed to local entities to 
        carry out such activities through the statewide system.
    (g) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this subtitle, $2,100,000,000 for each of 
fiscal years 1998 through 2001.
    (h) Effective Date.--This chapter shall take effect on July 1, 
1998.
                   Subtitle D--Transition Provisions

SEC. 761. WAIVERS.

    (a) Waiver Authority.--
            (1) In general.--Notwithstanding any other provision of 
        Federal law, and except as provided in subsection (d), the 
        Secretary may waive any requirement under any provision of law 
        relating to a covered activity, or of any regulation issued 
        under such a provision, for--
                    (A) a State that requests such a waiver and submits 
                an application as described in subsection (b); or
                    (B) a local entity that requests such a waiver and 
                complies with the requirements of subsection (c);
        in order to assist the State or local entity in planning or 
        developing a statewide system or workforce development 
        activities to be carried out through the statewide system.
            (2) Term.--
                    (A) In general.--Except as provided in subparagraph 
                (B), each waiver approved pursuant to this section 
                shall be for a period beginning on the date of the 
                approval and ending on June 30, 1998.
                    (B) Failure to submit interim plan.--If a State 
                receives a waiver under this section and fails to 
                submit an interim plan under section 762 by June 30, 
                1997, the waiver shall be deemed to terminate on 
                September 30, 1997. If a local entity receives a waiver 
                under this section, and the State in which the local 
                entity is located fails to submit an interim plan under 
                section 762 by June 30, 1997, the waiver shall be 
                deemed to terminate on September 30, 1997.
    (b) State Request for Waiver.--
            (1) In general.--A State may submit to the Secretary a 
        request for a waiver of 1 or more requirements referred to in 
        subsection (a). The request may include a request for different 
        waivers with respect to different areas within the State.
            (2) Application.--To be eligible to receive a waiver 
        described in subsection (a), a State shall submit an 
        application to the Secretary at such time, in such manner, and 
        containing such information as the Secretary may require, 
        including information--
                    (A) identifying the requirement to be waived and 
                the goal that the State (or the local agency applying 
                to the State under subsection (c)) intends to achieve 
                through the waiver;
                    (B) identifying, and describing the actions that 
                the State will take to remove, similar State 
                requirements;
                    (C) describing the activities to which the waiver 
                will apply, including information on how the activities 
                may be continued, or related to activities carried out, 
                under the statewide system of the State;
                    (D) describing the number and type of persons to be 
                affected by such waiver; and
                    (E) providing evidence of support for the waiver 
                request by the State agencies or officials with 
                jurisdiction over the requirement to be waived.
    (c) Local Entity Request for Waiver.--
            (1) In general.--A local entity that seeks a waiver of such 
        a requirement shall submit to the State a request for the 
        waiver and an application containing sufficient information to 
        enable the State
         to comply with the requirements of subsection (b)(2). The 
State shall determine whether to submit a request and an application 
for a waiver to the Secretary, as provided in subsection (b).
            (2) Time limit.--
                    (A) In general.--The State shall make a 
                determination concerning whether to submit the request 
                and application for a waiver as described in paragraph 
                (1) not later than 30 days after the date on which the 
                State receives the application from the local entity.
                    (B) Direct submission.--
                            (i) In general.--If the State does not make 
                        a determination to submit or does not submit 
                        the request and application within the 30-day 
                        time period specified in subparagraph (A), the 
                        local entity may submit the request and 
                        application to the Secretary.
                            (ii) Requirements.--In submitting such a 
                        request, the local entity shall obtain the 
                        agreement of the State involved to comply with 
                        the requirements of this section that would 
                        otherwise apply to a State submitting a request 
                        for a waiver. In reviewing an application 
                        submitted by a local entity, the Secretary 
                        shall comply with the requirements of this 
                        section that would otherwise apply to the 
                        Secretary with respect to review of such an 
                        application submitted by a State.
    (d) Waivers Not Authorized.--The Secretary may not waive any 
requirement of any provision referred to in subsection (a), or of any 
regulation issued under such provision, relating to--
            (1) the allocation of funds to States, local entities, or 
        individuals;
            (2) public health or safety, civil rights, occupational 
        safety and health, environmental protection, displacement of 
        employees, or fraud and abuse;
            (3) the eligibility of an individual for participation in a 
        covered activity, except in a case in which the State or local 
        entity can demonstrate that the individuals who would have been 
        eligible to participate in such activity without the waiver 
        will participate in a similar covered activity; or
            (4) a required supplementation of funds by the State or a 
        prohibition against the State supplanting such funds.
    (e) Activities.--Subject to subsection (d), the Secretary may 
approve a request for a waiver described in subsection (a) that would 
enable a State or local entity to--
            (1) use the assistance that would otherwise have been used 
        to carry out 2 or more covered activities (if the State or 
        local entity were not using the assistance as described in this 
        section)--
                    (A) to address the high priority needs of 
                unemployed persons and at-risk youth in the appropriate 
                State or community for workforce employment activities 
                or workforce education activities;
                    (B) to improve efficiencies in the delivery of the 
                covered activities; or
                    (C) in the case of overlapping or duplicative 
                activities--
                            (i) by combining the covered activities and 
                        funding the combined activities; or
                            (ii) by eliminating 1 of the covered 
                        activities and increasing the funding to the 
                        remaining covered activity; and
            (2) use the assistance that would otherwise have been used 
        for administrative expenses relating to a covered activity (if 
        the State or local entity were not using the assistance as 
        described in this section) to pay for the cost of developing an 
        interim State plan described in section 762 or a State plan 
        described in section 714.
    (f) Approval or Disapproval.--The Secretary shall approve or 
disapprove any request submitted pursuant to subsection (b) or (c), not 
later than 45 days after the date of the submission and shall issue a 
decision that shall include the reasons for approving or disapproving 
the request.
    (g) Failure To Act.--If the Secretary fails to approve or 
disapprove the request within the 45-day period described in subsection 
(f), the request shall be deemed to be approved on the day after such 
period ends. If the Secretary subsequently determines that the waiver 
relates to a matter described in subsection (d) and issues a decision 
that includes the reasons for the determination, the waiver shall be 
deemed to terminate on the date of issuance of the decision.
    (h) Definition.--As used in this section:
            (1) Local entity.--The term ``local entity'' means--
                    (A) a local educational agency, with respect to any 
                act by a local agency or organization relating to a 
                covered activity that is a workforce education 
                activity; and
                    (B) the local public or private agency or 
                organization responsible for carrying out the covered 
                activity at issue, with respect to any act by a local 
                agency or organization relating to any other covered 
                activity.
            (2) Secretary.--The term ``Secretary'' means--
                    (A) the Secretary of Labor, with respect to any act 
                relating to a covered activity carried out by the 
                Secretary of Labor;
                    (B) the Secretary of Education, with respect to any 
                act relating to a covered activity carried out by the 
                Secretary of Education; and
                    (C) the Secretary of Health and Human Services, 
                with respect to any act relating to a covered activity 
                carried out by the Secretary of Health and Human 
                Services.
            (3) State.--The term ``State'' means--
                    (A) a State educational agency, with respect to any 
                act by a State entity relating to a covered activity 
                that is a workforce education activity; and
                    (B) the Governor, with respect to any act by a 
                State entity relating to any other covered activity.
    (i) Conforming Amendments.--
            (1) Section 501 of the School-to-Work Opportunities Act of 
        1994 (20 U.S.C. 6211) is amended--
                    (A) in subsection (a), by striking ``sections 502 
                and 503'' and inserting ``section 502'';
                    (B) in subsection (b)(2)(B)(ii)--
                            (i) by striking ``section 502(a)(1)(C) or 
                        503(a)(1)(C), as appropriate,'' and inserting 
                        ``section 502(a)(1)(C)''; and
                            (ii) by striking ``section 502 or 503, as 
                        appropriate,'' and inserting ``section 502'';
                    (C) in subsection (c), by striking ``section 502 or 
                503'' and inserting ``section 502''; and
                    (D) by striking ``Secretaries'' each place the term 
                appears and inserting ``Secretary of Education''.
            (2) Section 502(b) of such Act (20 U.S.C. 6212(b)) is 
        amended--
                    (A) in paragraph (4), by striking the semicolon and 
                inserting ``; and'';
                    (B) in paragraph (5), by striking ``; and'' and 
                inserting a period; and
                    (C) by striking paragraph (6).
            (3) Section 503 of such Act (20 U.S.C. 6213) is repealed.
            (4) Section 504 of such Act (20 U.S.C. 6214) is amended--
                    (A) in subsection (a)(2)(B), by striking clauses 
                (i) and (ii) and inserting the following clauses:
                            ``(i) the provisions of law listed in 
                        paragraphs (2) through (5) of section 502(b);
                            ``(ii) the Job Training Partnership Act (29 
                        U.S.C. 1501 et seq.); and
                            ``(iii) the Carl D. Perkins Vocational and 
                        Applied Technology Education Act (20 U.S.C. 
                        2301 et seq.).''; and
                    (B) in subsection (b), by striking ``paragraphs (1) 
                through (3), and paragraphs (5) and (6), of section 
                503(b)'' and inserting ``paragraphs (2) through (4) and 
                paragraphs (6) and (7) of section 505(b)''.
            (5) Section 505(b) of such Act (20 U.S.C. 6215(b)) is 
        amended to read as follows:
    ``(b) Use of Funds.--A State may use, under the requirements of 
this Act, Federal funds that are made available to the State and 
combined under subsection (a) to carry out school-to-work activities, 
except that the provisions relating to--
            ``(1) the matters specified in section 502(c);
            ``(2) basic purposes or goals;
            ``(3) maintenance of effort;
            ``(4) distribution of funds;
            ``(5) eligibility of an individual for participation;
            ``(6) public health or safety, labor standards, civil 
        rights, occupational safety and health, or environmental 
        protection; or
            ``(7) prohibitions or restrictions relating to the 
        construction of buildings or facilities;
that relate to the program through which the funds described in 
subsection (a)(2)(B) were made available, shall remain in effect with 
respect to the use of such funds.''.

SEC. 762. INTERIM STATE PLANS.

    (a) In General.--For a State or local entity in a State to use a 
waiver received under section 761 through June 30, 1998, and for a 
State to be eligible to submit a State plan described in section 714 
for program year 1998, the Governor of the State shall submit an 
interim
 State plan to the Governing Board. The Governor shall submit the plan 
not later than June 30, 1997.
    (b) Requirements.--The interim State plan shall comply with the 
requirements applicable to State plans described in section 714.
    (c) Program Year.--In submitting the interim State plan, the 
Governor shall indicate whether the plan is submitted--
            (1) for review and approval for program year 1997; or
            (2) solely for review.
    (d) Review.--In reviewing an interim State plan, the Governing 
Board may--
            (1) in the case of a plan submitted for review and approval 
        for program year 1997--
                    (A) approve the plan and permit the State to use a 
                waiver as described in section 761 to carry out the 
                plan; or
                    (B) disapprove the plan, and provide to the State 
                reasons for the disapproval and technical assistance 
                for developing an approvable plan to be submitted under 
                section 714 for program year 1998; and
            (2) in the case of a plan submitted solely for review, 
        review the plan and provide to the State technical assistance 
        for developing an approvable plan to be submitted under section 
        714 for program year 1998.
    (e) Effect of Disapproval.--Disapproval of an interim plan shall 
not affect the ability of a State to use a waiver as described in 
section 761 through June 30, 1998.

SEC. 763. APPLICATIONS AND PLANS UNDER COVERED ACTS.

    Notwithstanding any other provision of law, no State or local 
entity shall be required to comply with any provision of a covered Act 
that would otherwise require the entity to submit an application or a 
plan to a Federal agency during fiscal year 1996 or 1997 for funding of 
a covered activity. In determining whether to provide funding to the 
State or local entity for the covered activity, the Secretary of 
Education, the Secretary of Labor, or the Secretary of Health and Human 
Services, as appropriate, shall consider the last application or plan, 
as appropriate, submitted by the entity for funding of the covered 
activity.

SEC. 764. INTERIM ADMINISTRATION OF SCHOOL-TO-WORK PROGRAMS.

    (a) In General.--Any provision of the School-to-Work Opportunities 
Act of 1994 (20 U.S.C. 6101 et seq.) that grants authority to the 
Secretary of Labor or the Secretary of Education shall be considered to 
grant the authority to the Governing Board.
    (b) Effective Date.--Subsection (a) shall take effect on October 1, 
1996.

SEC. 765. INTERIM AUTHORIZATIONS OF APPROPRIATIONS.

    (a) Older American Community Service Employment Act.--Section 
508(a)(1) of the Older American Community Service Employment Act (42 
U.S.C. 3056f(a)(1)) is amended by striking ``for fiscal years 1993, 
1994, and 1995'' and inserting ``for each of fiscal years 1993 through 
1998''.
    (b) Carl D. Perkins Vocational and Applied Technology Education 
Act.--
            (1) In general.--Section 3(a) of the Carl D. Perkins 
        Vocational and Applied Technology Education Act (20 U.S.C. 
        2302(a)) is amended by striking ``for each of the fiscal 
        years'' and all that follows through ``1995'' and inserting 
        ``for each of fiscal years 1992 through 1998''.
            (2) Research.--Section 404(d) of such Act (20 U.S.C. 
        2404(d)) is amended by striking ``for each of the fiscal 
        years'' and all that follows through ``1995'' and inserting 
        ``for each of fiscal years 1992 through 1998''.
    (c) Adult Education Act.--
            (1) In general.--Section 313(a) of the Adult Education Act 
        (20 U.S.C. 1201b(a)) is amended by striking ``for each of the 
        fiscal years'' and all that follows through ``1995'' and 
        inserting ``for each of fiscal years 1993 through 1998''.
            (2) State literacy resource centers.--Section 356(k) of 
        such Act (20 U.S.C. 1208aa(k)) is amended by striking ``for 
        each of the fiscal years 1994 and 1995'' and inserting ``for 
        each of fiscal years 1994 through 1998''.
            (3) Business, industry, labor, and education partnerships 
        for workplace literacy.--Section 371(e)(1) of such Act (20 
        U.S.C. 1211(e)(1)) is amended by striking ``for each of the 
        fiscal years'' and all that follows through ``1995'' and 
        inserting ``for each of fiscal years 1993 through 1998''.
            (4) National institute for literacy.--Section 384(n)(1) of 
        such Act (20 U.S.C. 1213c(n)(1)) is amended by striking ``for 
        each of the fiscal years'' and all that follows through 
        ``1996'' and inserting ``for each of fiscal years 1992 through 
        1998''.
                    Subtitle E--National Activities

SEC. 771. FEDERAL PARTNERSHIP.

    (a) Establishment.--There is established a Workforce Development 
Partnership that shall administer the activities established under this 
title. The Federal Partnership shall be a Government corporation, as 
defined in section 103 of title 5, United States Code. The principal 
office of the Federal Partnership shall be located in the District of 
Columbia.
    (b) Governing Board.--
            (1) Composition.--There shall be in the Federal Partnership 
        a Governing Board that shall be composed of 13 individuals, 
        including--
                    (A) 7 individuals who are representative of 
                business and industry in the United States, appointed 
                by the President by and with the advice and consent of 
                the Senate;
                    (B) 2 individuals who are representative of labor 
                and workers in the United States, appointed by the 
                President by and with the advice and consent of the 
                Senate;
                    (C) 2 individuals who are representative of 
                education providers, 1 of whom is a State or local 
                adult education provider and 1 of whom is a State or 
                local vocational education provider, appointed by the 
                President by and with the advice and consent of the 
                Senate; and
                    (D) 2 Governors, representing different political 
                parties, appointed by the President by and with the 
                advice and consent of the Senate.
            (2) Terms.--Each member of the Governing Board shall serve 
        for a term of 3 years, except that, as designated by the 
        President--
                    (A) 5 of the members first appointed to the 
                Governing Board shall serve for a term of 2 years;
                    (B) 4 of the members first appointed to the 
                Governing Board shall serve for a term of 3 years; and
                    (C) 4 of the members first appointed to the 
                Governing Board shall serve for a term of 4 years.
            (3) Vacancies.--Any vacancy in the Governing Board shall 
        not affect the powers of the Governing Board, but shall be 
        filled in the same manner as the original appointment. Any 
        member appointed to fill such a vacancy shall serve for the 
        remainder of the term for which the predecessor of such member 
        was appointed.
            (4) Duties and powers.--
                    (A) Powers.--The powers of the Federal Partnership 
                shall be vested in the Governing Board.
                    (B) Duties.--The Governing Board shall--
                            (i) oversee the development and 
                        implementation of the nationwide integrated 
                        labor market information system described in 
                        section 773, and the job placement 
                        accountability system described in section 
                        731(d);
                            (ii) establish model benchmarks for each of 
                        the benchmarks referred to in paragraph (1), 
                        (2), or (3) of section 731(c), at achievable 
                        levels based on existing (as of the date of the 
                        establishment of the benchmarks) workforce 
                        development efforts in the States;
                            (iii) negotiate State benchmarks with 
                        States in accordance with section 731(c)(5);
                            (iv) review and approve plans under section 
                        714, and make allotments under section 712;
                            (v) receive and review reports described in 
                        section 731(a);
                            (vi) prepare and submit to the appropriate 
                        committees of Congress an annual report on the 
                        absolute and relative performance of States 
                        toward reaching the State benchmarks;
                            (vii) award annual incentive grants under 
                        section 732(a);
                            (viii) initiate sanctions described in 
                        section 732(b);
                            (ix) disseminate information to States on 
                        the best practices used by States to establish 
                        and carry out activities through statewide 
                        systems, including model programs to provide 
                        structured work and learning experiences for 
                        welfare recipients;
                            (x) perform the duties specified for the 
                        Governing Board in subtitles C and D;
                            (xi) review all federally funded programs 
                        providing workforce development activities, 
                        other than programs carried out under this 
                        title, and submit recommendations to Congress 
                        on how the federally funded programs could be 
                        integrated into the statewide systems of the 
                        States, including recommendations on the 
                        development of common terminology for 
                        activities and services provided through the 
                        programs;
                            (xii) review and approve the transition 
                        workplans developed by the Secretary of Labor 
                        and the Secretary of Education in accordance 
                        with sections 775 and 776; and
                            (xiii) oversee all activities of the 
                        Federal Partnership.
                    (C) Final determinations.--Notwithstanding any 
                other provision of this title, the Secretary of Labor 
                and the Secretary of Education shall jointly make the 
                final determinations with respect to the approval of 
                State plans, and the disbursement of funds, under this 
                title.
            (5) Chairperson.--The position of Chairperson of the 
        Governing Board shall rotate annually among the appointed 
        members described in paragraph (1)(A).
            (6) Meetings.--The Governing Board shall meet at the call 
        of the Chairperson but not less often than 4 times during each 
        calendar year. Five members of the Governing Board shall 
        constitute a quorum. All decisions of the Governing Board with 
        respect to the exercise of the duties and powers of the 
        Governing Board shall be made by a majority vote of the members 
        of the Governing Board.
            (7) Compensation and travel expenses.--
                    (A) Compensation.--Each member of the Governing 
                Board who is not an officer or employee of the Federal 
                Government shall be compensated at a rate to be fixed 
                by the President but not to exceed the daily equivalent 
                of the maximum rate authorized for a position above GS-
                15 of the General Schedule under section 5108 of title 
                5, United States Code, for each day (including travel 
                time) during which such member is engaged in the 
                performance of the duties of the Governing Board. All 
                members of the Governing Board who are officers or 
                employees of the United States shall serve without 
                compensation in addition to compensation received for 
                their services as officers or employees of the United 
                States.
                    (B) Expenses.--While away from their homes or 
                regular places of business on the business of the 
                Governing Board, members of such Governing Board shall 
                be allowed travel expenses, including per diem in lieu 
                of subsistence, at rates authorized for employees of 
                agencies under subchapter I of chapter 57 of title 5, 
                United States Code, for persons employed intermittently 
                in the Government service.
            (8) Date of appointment.--The Governing Board shall be 
        appointed not later than September 30, 1996.
    (c) Director.--
            (1) In general.--There shall be in the Federal Partnership 
        a Director, who shall be appointed by the President, by and 
        with the advice and consent of the Senate.
            (2) Compensation.--The Director shall be compensated at the 
        rate provided for level IV of the Executive Schedule under 
        section 5315 of title 5, United States Code.
            (3) Duties.--The Director shall--
                    (A) make recommendations to the Governing Board 
                regarding the activities described in subsection 
                (b)(4)(B); and
                    (B) carry out the general administration and 
                enforcement of this title.
            (4) Date of appointment.--The Director shall be appointed 
        not later than September 30, 1996.
    (d) Detail of Government Employees.--Any Federal Government 
employee may be detailed to the Federal Partnership without 
reimbursement, and such detail shall be without interruption or loss of 
civil service or privilege. The Secretary of Education, the Secretary 
of Labor, and the Secretary of Health and Human Services shall detail a 
sufficient number of employees to the Federal Partnership for the 
period beginning October 1, 1996 and ending June 30, 1998 to enable the 
Federal Partnership to carry out the functions of the Federal 
Partnership during such period.
    (e) Inspector General.--There shall be an Office of the Inspector 
General in the Federal Partnership. The Office shall be headed by an 
Inspector General appointed in accordance with the Inspector General 
Act of 1978 (5 U.S.C. App.). The Inspector General shall carry out the 
duties prescribed in such Act.
    (f) Authorization of Appropriations.--There is authorized to be 
appropriated for fiscal years 1996 and 1997 $500,000 to the Governing 
Board for the administration of this title.
    (g) Conforming Amendment.--Section 11 of the Inspector General Act 
of 1978 (5 U.S.C. App.) is amended--
            (1) in paragraph (1), by inserting ``the Governing Board of 
        the Workforce Development Partnership;'' after ``the Attorney 
        General;''; and
            (2) in paragraph (2), by inserting ``the Workforce 
        Development Partnership;'' after ``Treasury;''.
SEC. 772. NATIONAL ASSESSMENT OF VOCATIONAL EDUCATION PROGRAMS.

    (a) In General.--The Assistant Secretary for Educational Research 
and Improvement (referred to in this section as the ``Assistant 
Secretary'') shall conduct a national assessment of vocational 
education programs assisted under this title, through studies and 
analyses conducted independently through competitive awards.
    (b) Independent Advisory Panel.--The Assistant Secretary shall 
appoint an independent advisory panel, consisting of vocational 
education administrators, educators, researchers, and representatives 
of business, industry, labor, and other relevant groups, to advise the 
Assistant Secretary on the implementation of such assessment, including 
the issues to be addressed and the methodology of the studies involved, 
and the findings and recommendations resulting from the assessment. The 
panel, in the discretion of the panel, may submit to Congress an 
independent analysis of the findings and recommendations resulting from 
the assessment. The Federal Advisory Committee Act (5 U.S.C. App.) 
shall not apply to the panel established under this subsection.
    (c) Contents.--The assessment required under subsection (a) shall 
include descriptions and evaluations of--
            (1) the effect of this title on State and tribal 
        administration of vocational education programs and on local 
        vocational education practices, including the capacity of 
        State, tribal, and local vocational education systems to 
        address the purposes of this title;
            (2) expenditures at the Federal, State, tribal, and local 
        levels to address program improvement in vocational education, 
        including the impact of Federal allocation requirements (such 
        as within-State distribution formulas) on the delivery of 
        services;
            (3) preparation and qualifications of teachers of 
        vocational and academic curricula in vocational education 
        programs, as well as shortages of such teachers;
            (4) participation in vocational education programs;
            (5) academic and employment outcomes of vocational 
        education, including analyses of--
                    (A) the effect of educational reform on vocational 
                education;
                    (B) the extent and success of integration of 
                academic and vocational curricula;
                    (C) the success of the school-to-work transition; 
                and
                    (D) the degree to which vocational training is 
                relevant to subsequent employment;
            (6) employer involvement in, and satisfaction with, 
        vocational education programs;
            (7) the effect of benchmarks, performance measures, and 
        other measures of accountability on the delivery of vocational 
        education services; and
            (8) the degree to which minority students are involved in 
        vocational student organizations.
    (d) Consultation.--
            (1) In general.--The Secretary of Education shall consult 
        with the Committee on Economic and Educational Opportunities of 
        the House of Representatives and the Committee on Labor and 
        Human Resources of the Senate in the design and implementation 
        of the assessment required under subsection (a).
            (2) Reports.--The Secretary of Education shall submit to 
        Congress--
                    (A) an interim report regarding the assessment on 
                or before January 1, 2000; and
                    (B) a final report, summarizing all studies and 
                analyses that relate to the assessment and that are 
                completed after the assessment, on or before July 1, 
                2000.
            (3) Prohibition.--Notwithstanding any other provision of 
        law or regulation, the reports required by this subsection 
        shall not be subject to any review outside of the Office of 
        Educational Research and Improvement before their transmittal 
        to Congress, but the President, the Secretary, and the 
        independent advisory panel established under subsection (b) may 
        make such additional recommendations to Congress with respect 
        to the assessment as the President, Secretary, or panel 
        determine to be appropriate.
    (e) Effective Date.--This section shall take effect on July 1, 
1998.
SEC. 773. LABOR MARKET INFORMATION.

    (a) Federal Responsibilities.--The Governing Board, in accordance 
with the provisions of this section, shall oversee the development, 
maintenance, and continuous improvement of a nationwide integrated 
labor market information system that shall include--
            (1) statistical data from cooperative statistical survey 
        and projection programs and data from administrative reporting 
        systems, that, taken together, shall enumerate, estimate, and 
        project the supply and demand for labor at the substate, State, 
        and national levels in a timely manner, including data on--
                    (A) the demography, socioeconomic characteristics, 
                and current employment status of the substate, State, 
                and national populations (as of the date of the 
                collection of the data), including self-employed, part-
                time, and seasonal workers;
                    (B) job vacancies, education and training 
                requirements, skills, wages, benefits, working 
                conditions, and industrial distribution, of 
                occupations, as well as current and projected 
                employment opportunities and trends by industry and 
                occupation;
                    (C) the educational attainment, training, skills, 
                skill levels, and occupations of the populations;
                    (D) information maintained in a longitudinal manner 
                on the quarterly earnings, establishment and industry 
                affiliation, and geographic location of employment for 
                all individuals for whom the information is collected 
                by the States; and
                    (E) the incidence, industrial and geographical 
                location, and number of workers displaced by permanent 
                layoffs and plant closings;
            (2) State and substate area employment and consumer 
        information (which shall be current, comprehensive, automated, 
        accessible, easy to understand, and in a form useful for 
        facilitating immediate employment, entry into education and 
        training programs, and career exploration) on--
                    (A) job openings, locations, hiring requirements, 
                and application procedures, including profiles of 
                industries in the local labor market that describe the 
                nature of work performed, employment requirements, and 
                patterns in wages and benefits;
                    (B) jobseekers, including the education, training, 
                and employment experience of the jobseekers; and
                    (C) the cost and effectiveness of providers of 
                workforce employment activities, workforce education 
                activities, and flexible workforce activities, 
                including the percentage of program completion, 
                acquisition of skills to meet industry-recognized skill 
                standards, continued education, job placement, and 
                earnings, by participants, and other information that 
                may be useful in facilitating informed choices among 
                providers by participants;
            (3) technical standards for labor market information that 
        will--
                    (A) ensure compatibility of the information and the 
                ability to aggregate the information from substate 
                areas to State and national levels;
                    (B) support standardization and aggregation of the 
                data from administrative reporting systems;
                    (C) include--
                            (i) classification and coding systems for 
                        industries, occupations, skills, programs, and 
                        courses;
                            (ii) nationally standardized definitions of 
                        labor market terms, including terms related to 
                        State benchmarks established pursuant to 
                        section 731(c);
                            (iii) quality control mechanisms for the 
                        collection and analysis of labor market 
                        information; and
                            (iv) common schedules for collection and 
                        dissemination of labor market information; and
                    (D) eliminate gaps and duplication in statistical 
                undertakings, with a high priority given to the 
                systemization of wage surveys;
            (4) an analysis of data and information described in 
        paragraphs (1) and (2) for uses such as--
                    (A) national, State, and substate area economic 
                policymaking;
                    (B) planning and evaluation of workforce 
                development activities;
                    (C) the implementation of Federal policies, 
                including the allocation of Federal funds to States and 
                substate areas; and
                    (D) research on labor market dynamics;
            (5) dissemination mechanisms for data and analysis, 
        including mechanisms that may be standardized among the States; 
        and
            (6) programs of technical assistance for States and 
        substate areas in the development, maintenance, utilization, 
        and continuous improvement of the data, information, standards, 
        analysis, and dissemination mechanisms, described in paragraphs 
        (1) through (5).
    (b) Joint Federal-State Responsibilities.--
            (1) In general.--The nationwide integrated labor market 
        information system shall be planned, administered, overseen, 
        and evaluated through a cooperative governance structure 
        involving the Federal Government and the States receiving 
        financial assistance under this title.
            (2) Annual plan.--The Governing Board shall, with the 
        assistance of the Bureau of Labor Statistics and other Federal 
        agencies, where appropriate, prepare an annual plan that shall 
        be the mechanism for achieving the cooperative Federal-State 
        governance structure for the nationwide integrated labor market 
        information system. The plan shall--
                    (A) establish goals for the development and 
                improvement of a nationwide integrated labor market 
                information system based on information needs for 
                achieving economic growth and productivity, 
                accountability, fund allocation equity, and an 
                understanding of labor market characteristics and 
                dynamics;
                    (B) describe the elements of the system, 
                including--
                            (i) standards, definitions, formats, 
                        collection methodologies, and other necessary 
                        system elements, for use in collecting the data 
                        and information described in paragraphs (1) and 
                        (2) of subsection (a); and
                            (ii) assurances that--
                                    (I) data will be sufficiently 
                                timely and detailed for uses including 
                                the uses described in subsection 
                                (a)(4);
                                    (II) administrative records will be 
                                standardized to facilitate the 
                                aggregation of data from substate areas 
                                to State and national levels and to 
                                support the creation of new statistical 
                                series from program records; and
                                    (III) paperwork and reporting 
                                requirements on employers and 
                                individuals will be reduced;
                    (C) recommend needed improvements in administrative 
                reporting systems to be used for the nationwide 
                integrated labor market information system;
                    (D) describe the current spending on integrated 
                labor market information activities from all sources, 
                assess the adequacy of the funds spent, and identify 
                the specific budget needs of the Federal Government and 
                States with respect to implementing and improving the 
                nationwide integrated labor market information system;
                    (E) develop a budget for the nationwide integrated 
                labor market information system that--
                            (i) accounts for all funds described in 
                        subparagraph (D) and any new funds made 
                        available pursuant to this title; and
                            (ii) describes the relative allotments to 
                        be made for--
                                    (I) operating the cooperative 
                                statistical programs pursuant to 
                                subsection (a)(1);
                                    (II) developing and providing 
                                employment and consumer information 
                                pursuant to subsection (a)(2);
                                    (III) ensuring that technical 
                                standards are met pursuant to 
                                subsection (a)(3); and
                                    (IV) providing the analysis, 
                                dissemination mechanisms, and technical 
                                assistance under paragraphs (4), (5), 
                                and (6) of subsection (a), and matching 
                                data;
                    (F) describe the involvement of States in 
                developing the plan by holding formal consultations 
                conducted in cooperation with representatives of the 
                Governors of each State or the State workforce 
                development board described in section 715, where 
                appropriate, pursuant to a process established by the 
                Governing Board; and
                    (G) provide for technical assistance to the States 
                for the development of statewide comprehensive labor 
                market information systems described in subsection (c), 
                including assistance with the development of easy-to-
                use software and hardware, or uniform information 
                displays.
        For purposes of applying Office of Management and Budget 
        Circular A-11 to determine persons eligible to participate in 
        deliberations relating to budget issues for the development of 
        the plan, the representatives of the Governors of each State 
        and the State workforce development board described in 
        subparagraph (F) shall be considered to be employees of the 
        Department of Labor.
    (c) State Responsibilities.--
            (1) Designation of state agency.--In order to receive 
        Federal financial assistance under this title, the Governor of 
        a State shall--
                    (A) establish an interagency process for the 
                oversight of a statewide comprehensive labor market 
                information system and for the participation of the 
                State in the cooperative Federal-State governance 
                structure for the nationwide integrated labor market 
                information system; and
                    (B) designate a single State agency or entity 
                within the State to be responsible for the management 
                of the statewide comprehensive labor market information 
                system.
            (2) Duties.--In order to receive Federal financial 
        assistance under this title, the State agency or entity within 
        the State designated under paragraph (1)(B) shall--
                    (A) consult with employers and local workforce 
                development boards described in section 728(b), where 
                appropriate, about the labor market relevance of the 
                data to be collected and displayed through the 
                statewide comprehensive labor market information 
                system;
                    (B) develop, maintain, and continuously improve the 
                statewide comprehensive labor market information 
                system, which shall--
                            (i) include all of the elements described 
                        in paragraphs (1), (2), (3), (4), (5), and (6) 
                        of subsection (a); and
                            (ii) provide the consumer information 
                        described in clauses (v) and (vi) of section 
                        716(a)(2)(B) in a manner that shall be 
                        responsive to the needs of business, industry, 
                        workers, and jobseekers;
                    (C) ensure the performance of contract and grant 
                responsibilities for data collection, analysis, and 
                dissemination, through the statewide comprehensive 
                labor market information system;
                    (D) conduct such other data collection, analysis, 
                and dissemination activities to ensure that State and 
                substate area labor market information is 
                comprehensive;
                    (E) actively seek the participation of other State 
                and local agencies, with particular attention to State 
                education, economic development, human services, and 
                welfare agencies, in data collection, analysis, and 
                dissemination activities in order to ensure 
                complementarity and compatibility among data;
                    (F) participate in the development of the national 
                annual plan described in subsection (b)(2); and
                    (G) ensure that the matches required for the job 
                placement accountability system by section 731(d)(2)(A) 
                are made for the State and for other States.
            (3) Rule of construction.--Nothing in this title shall be 
        construed as limiting the ability of a State agency to conduct 
        additional data collection, analysis, and dissemination 
        activities with State funds or with Federal funds from sources 
        other than this title.
    (d) Effective Date.--This section shall take effect on July 1, 
1998.

SEC. 774. NATIONAL CENTER FOR RESEARCH IN EDUCATION AND WORKFORCE 
              DEVELOPMENT.

    (a) Grants Authorized.--From amounts made available under section 
734(b)(5), the Governing Board is authorized to award a grant, on a 
competitive basis, to an institution of higher education, public or 
private nonprofit organization or agency, or a consortium of such 
institutions, organizations, or agencies, to enable such institution, 
organization, agency, or consortium to establish a national center to 
carry out the activities described in subsection (b).
    (b) Authorized Activities.--Grant funds made available under this 
section shall be used by the national center assisted under subsection 
(a)--
            (1) to increase the effectiveness and improve the 
        implementation of workforce development programs, including 
        conducting research and development and providing technical 
        assistance with respect to--
                    (A) combining academic and vocational education;
                    (B) connecting classroom instruction with work-
                based learning;
                    (C) creating a continuum of educational programs 
                that provide multiple exit points for employment, which 
                may include changes or development of instructional 
                materials or curriculum;
                    (D) establishing high quality support services for 
                all students to ensure access to
                 workforce development programs, educational success, 
and job placement assistance;
                    (E) developing new models for remediation of basic 
                academic skills, which models shall incorporate 
                appropriate instructional methods, rather than using 
                rote and didactic methods;
                    (F) identifying ways to establish links among 
                educational and job training programs at the State and 
                local levels;
                    (G) developing new models for career guidance, 
                career information, and counseling services;
                    (H) identifying economic and labor market changes 
                that will affect workforce needs;
                    (I) conducting preparation of teachers and 
                professionals who work with programs funded under this 
                title; and
                    (J) obtaining information on practices in other 
                countries that may be adapted for use in the United 
                States;
            (2) to provide assistance to States and local recipients of 
        assistance under this title in developing and using systems of 
        performance measures and standards for improvement of programs 
        and services; and
            (3) to maintain a clearinghouse that will provide data and 
        information to Federal, State, and local organizations and 
        agencies about the condition of statewide systems and programs 
        funded under this title, which data and information shall be 
        disseminated in a form that is useful to practitioners and 
        policymakers.
    (c) Other Activities.--The Governing Board may request that the 
national center assisted under subsection (a) conduct activities not 
described in subsection (b), or study topics not described in 
subsection (b), as the Governing Board determines to be necessary to 
carry out this title.
    (d) Identification of Current Needs.--The national center assisted 
under subsection (a) shall identify current needs (as of the date of 
the identification) for research and technical assistance through a 
variety of sources including a panel of Federal, State, and local level 
practitioners.
    (e) Summary Report.--The national center assisted under subsection 
(a) shall annually prepare and submit to the Governing Board and 
Congress a report summarizing the research findings obtained, and the 
results of development and technical assistance activities carried out, 
under this section.
    (f) Definition.--As used in this section, the term ``institution of 
higher education'' has the meaning given the term in section 1201(a) of 
the Higher Education Act of 1965 (20 U.S.C. 1141(a)).
    (g) Effective Date.--This section shall take effect on July 1, 
1998.
SEC. 775. TRANSFERS TO FEDERAL PARTNERSHIP.

    (a) Definitions.--For purposes of this section, unless otherwise 
provided or indicated by the context--
            (1) the term ``Federal agency'' has the meaning given to 
        the term ``agency'' by section 551(1) of title 5, United States 
        Code;
            (2) the term ``function'' means any duty, obligation, 
        power, authority, responsibility, right, privilege, activity, 
        or program; and
            (3) the term ``office'' includes any office, 
        administration, agency, institute, unit, organizational entity, 
        or component thereof.
    (b) Transfer of Functions.--
            (1) In general.--There are transferred to the Federal 
        Partnership, in accordance with subsection (c), all functions 
        that the Secretary of Labor or the Secretary of Education 
        exercised before the effective date of this section (including 
        all related functions of any officer or employee of the 
        Department of Labor or the Department of Education) that relate 
        to a covered activity and that are minimally necessary to carry 
        out the functions of the Federal Partnership. The authority of 
        a transferred employee to carry out a function that relates to 
        a covered activity shall terminate on July 1, 1998.
            (2) Office of inspector general.--There are transferred to 
        the Federal Partnership, in accordance with subsection (c), all 
        functions that the Secretary of Labor or the Secretary of 
        Education, acting through the Office of Inspector General of 
        the Department of Labor or of the Department of Education, 
        exercised before the effective date of this section (including 
        all related functions of any officer or employee of the 
        Department of Labor or the Department of Education) that relate 
        to the auditing or investigation of a covered activity and that 
        are minimally necessary to carry out the functions of the 
        Federal Partnership. The authority of a transferred employee to 
        carry out a function that relates to the auditing or 
        investigation of a covered activity shall terminate on July 1, 
        1998.
    (c) Determinations of Functions by the Governing Board.--
            (1) Transition workplan.--
                    (A) In general.--Not later than the date of 
                appointment of the Governing Board, the Secretary of 
                Labor and the Secretary of Education shall prepare and 
                submit to the Governing Board a proposed workplan that 
                specifies the steps that the Secretaries will take, 
                during the period ending on July 1, 1998, to carry out 
                the transfers described in subsection (b).
                    (B) Contents.--The proposed workplan shall include, 
                at a minimum--
                            (i) an analysis of the functions that 
                        officers and employees of the Department of 
                        Labor and the Department of Education carry out 
                        (as of the date of the submission of the 
                        workplan) that relate to a covered activity or 
                        to the auditing or investigation of a covered 
                        activity;
                            (ii) information on the levels of personnel 
                        and funding used to carry out the functions (as 
                        of such date);
                            (iii) information on the proposed 
                        organizational structure for the Federal 
                        Partnership;
                            (iv) a determination of the functions 
                        described in clause (i) that are minimally 
                        necessary to carry out the functions of the 
                        Federal Partnership; and
                            (v) information on the levels of personnel 
                        and funding that are minimally necessary to 
                        carry out the functions of the Federal 
                        Partnership.
            (2) Review.--Not later than 30 days after the date of 
        submission of the workplan, the Governing Board shall--
                    (A) review the workplan;
                    (B) approve the workplan or prepare a revised 
                workplan that contains the analysis and information 
                described in paragraph (1)(B), including a 
                determination of the functions described in paragraph 
                (1)(B)(iv), which shall be transferred under subsection 
                (b); and
                    (C) submit the approved or revised workplan to the 
                appropriate committees of Congress.
    (d) Personnel Provisions.--
            (1) Appointments.--The Director may appoint and fix the 
        compensation of such officers and employees, including 
        investigators, attorneys, and administrative law judges, as may 
        be necessary to carry out the functions of the Federal 
        Partnership. Except as otherwise provided by law, such officers 
        and employees shall be appointed in accordance with the civil 
        service laws and their compensation fixed in accordance with 
        title 5, United States Code.
            (2) Experts and consultants.--The Director may obtain the 
        services of experts and consultants in accordance with section 
        3109 of title 5, United States Code, and compensate such 
        experts and consultants for each day (including travel time) at 
        rates not in excess of the rate of pay for level IV of the 
        Executive Schedule under section 5315 of such title. The 
        Director may pay experts and consultants who are serving away 
        from their homes or regular place of business travel expenses 
        and per diem in lieu of subsistence at rates authorized by 
        sections 5702 and 5703 of such title for persons in Government 
        service employed intermittently.
    (e) Delegation and Assignment.--Except where otherwise expressly 
prohibited by law or otherwise provided by this section, the Governing 
Board may delegate any function transferred or granted to such Federal 
Partnership after the effective date of this section to such officers 
and employees of the Federal Partnership as the Governing Board may 
designate, and may authorize successive redelegations of such functions 
as may be necessary or appropriate. No delegation of functions by the 
Governing Board under this subsection or under any other provision of 
this section shall relieve such Governing Board of responsibility for 
the administration of such functions.
    (f) Reorganization.--The Governing Board may allocate or reallocate 
any function transferred or granted to such Federal Partnership after 
the effective date of this section among the officers of the Federal 
Partnership, and establish, consolidate, alter, or discontinue such 
organizational entities in the Federal Partnership as may be necessary 
or appropriate.
    (g) Rules.--The Governing Board is authorized to prescribe, in 
accordance with the provisions of chapters 5 and 6 of title 5, United 
States Code, such rules and regulations as the Governing Board 
determines to be necessary or appropriate to administer and manage the 
functions of the Federal Partnership.
    (h) Transfer and Allocations of Appropriations and Personnel.--
            (1) In general.--Except as otherwise provided in this 
        section, the personnel employed in connection with, and the 
        assets, liabilities, contracts, property, records, and 
        unexpended balances of appropriations, authorizations, 
        allocations, and other funds employed, used, held, arising 
        from, available to, or to be made available in connection with 
        the functions transferred by this section, subject to section 
        1531 of title 31, United States Code, shall be transferred to 
        the Federal Partnership. Unexpended funds transferred pursuant 
        to this subsection shall be used only to carry out the 
        functions of the Federal Partnership.
            (2) Existing facilities and other federal resources.--
        Pursuant to paragraph (1), the Secretary of Labor and the 
        Secretary of Education shall supply such office facilities, 
        office supplies, support services, and related expenses as may 
        be minimally necessary to carry out the functions of the 
        Governing Board. None of the funds made available under this 
        title may be used for the construction of office facilities for 
        the Federal Partnership.
    (i) Incidental Transfers.--The Director of the Office of Management 
and Budget, at such time or times as the Director shall provide, may 
make such determinations as may be necessary with regard to the 
functions transferred by this section, and to make such additional 
incidental dispositions of personnel, assets, liabilities, grants, 
contracts, property, records, and unexpended balances of 
appropriations, authorizations, allocations, and other funds held, 
used, arising from, available to, or to
 be made available in connection with such functions, as may be 
necessary to carry out the provisions of this section. The Director of 
the Office of Management and Budget shall provide for the termination 
of the affairs of all entities terminated by this section and for such 
further measures and dispositions as may be necessary to effectuate the 
objectives of this section.
    (j) Effect on Personnel.--
            (1) Termination of certain positions.--Positions whose 
        incumbents are appointed by the President, by and with the 
        advice and consent of the Senate, the functions of which are 
        transferred by this section, shall terminate on the effective 
        date of this section.
            (2) Actions.--
                    (A) In general.--The Secretary of Labor and the 
                Secretary of Education shall take such actions as may 
                be necessary, including reduction in force actions, 
                consistent with sections 3502 and 3595 of title 5, 
                United States Code, to ensure that the positions of 
                personnel that relate to a covered activity and are not 
                transferred under subsection (b)(1) are separated from 
                service.
                    (B) Scope.--The Secretary of Labor and the 
                Secretary of Education shall take the actions described 
                in subparagraph (A) with respect to not less than \1/3\ 
                of the positions of personnel that relate to a covered 
                activity.
                    (C) Definition.--As used in this paragraph, the 
                term ``positions of personnel that relate to a covered 
                activity'' shall not include any position in an Office 
                of Inspector General that relates to the auditing or 
                investigation of a covered activity.
    (k) Savings Provisions.--
            (1) Suits not affected.--The provisions of this section 
        shall not affect suits commenced before the effective date of 
        this section, and in all such suits, proceedings shall be had, 
        appeals taken, and judgments rendered in the same manner and 
        with the same effect as if this section had not been enacted.
            (2) Nonabatement of actions.--No suit, action, or other 
        proceeding commenced by or against the Department of Labor or 
        the Department of Education, or by or against any individual in 
        the official capacity of such individual as an officer of the 
        Department of Labor or the Department of Education, shall abate 
        by reason of the enactment of this section.
    (l) Transition.--The Governing Board may utilize--
            (1) the services of officers, employees, and other 
        personnel of the Department of Labor or the Department of 
        Education with respect to functions transferred to the Federal 
        Partnership by this section; and
            (2) funds appropriated to such functions;
for such period of time as may reasonably be needed to facilitate the 
orderly implementation of this section.
    (m) References.--A reference in any other Federal law, Executive 
order, rule, regulation, or delegation of authority, or any document of 
or relating to--
            (1) the Secretary of Labor or the Secretary of Education 
        with regard to functions transferred under subsection (b), 
        shall be deemed to refer to the Governing Board; and
            (2) the Department of Labor or the Department of Education 
        with regard to functions transferred under subsection (b), 
        shall be deemed to refer to the Federal Partnership.
    (n) Additional Conforming Amendments.--
            (1) Recommended legislation.--After consultation with the 
        appropriate committees of Congress and the Director of the 
        Office of Management and Budget, the Governing Board shall 
        prepare and submit to Congress recommended legislation 
        containing technical and conforming amendments to reflect the 
        changes made by this section.
            (2) Submission to congress.--Not later than March 31, 1997, 
        the Governing Board shall submit the recommended legislation 
        referred to in paragraph (1).
    (o) Effective Date.--
            (1) In general.--Except as provided in paragraphs (2) and 
        (3), this section shall take effect on June 30, 1998.
            (2) Regulations and conforming amendments.--Subsections (g) 
        and (n) shall take effect on September 30, 1996.
            (3) Workplan.--Subsection (c) shall take effect on the date 
        of enactment of this Act.

SEC. 776. TRANSFERS TO OTHER FEDERAL AGENCIES AND OFFICES.

    (a) Transfer.--There are transferred to the appropriate receiving 
agency, in accordance with subsection (b), all functions that the 
Secretary of Labor, acting through
 the Employment and Training Administration, or the Secretary of 
Education, acting through the Office of Vocational and Adult Education, 
exercised before the effective date of this section (including all 
related functions of any officer or employee of the Employment and 
Training Administration or the Office of Vocational and Adult 
Education) that do not relate to a covered activity.
    (b) Determinations of Functions and Appropriate Receiving 
Agencies.--
            (1) Transition workplan.--
                    (A) In general.--Not later than 90 days after the 
                date of appointment of the Governing Board, the 
                Secretary of Labor and the Secretary of Education shall 
                prepare and submit to the Governing Board a proposed 
                workplan that specifies the steps that the Secretaries 
                will take, during the period ending on July 1, 1998, to 
                carry out the transfer described in subsection (a).
                    (B) Contents.--The proposed workplan shall include, 
                at a minimum--
                            (i) a determination of the functions that 
                        officers and employees of the Employment and 
                        Training Administration and the Office of 
                        Vocational and Adult Education carry out (as of 
                        the date of the submission of the workplan) 
                        that do not relate to a covered activity; and
                            (ii) a determination of the appropriate 
                        receiving agencies for the functions, based on 
                        factors including increased efficiency and 
                        elimination of duplication of functions.
            (2) Review.--Not later than 30 days after the date of 
        submission of the workplan, the Governing Board shall--
                    (A) review the workplan;
                    (B) approve the workplan or prepare a revised 
                workplan that contains--
                            (i) a determination of the functions 
                        described in paragraph (1)(B)(i), which shall 
                        be transferred under subsection (a); and
                            (ii) a determination of the appropriate 
                        receiving agencies described in paragraph 
                        (1)(B)(ii), based on the factors described in 
                        such paragraph, to which the functions shall be 
                        transferred under subsection (a); and
                    (C) submit the approved or revised workplan to the 
                appropriate committees of Congress.
            (3) Report.--Not later than July 1, 1998, the Secretary of 
        Education and the Secretary of Labor shall submit to the 
        appropriate committees of Congress information on the transfers 
        required by this section.
    (c) Application of Authorities.--
            (1) In general.--
                    (A) Application.--Subsection (a), and subsections 
                (d) through (n), of section 775 (other than subsections 
                (g), (h)(2), (j)(2), and (n)) shall apply to transfers 
                under this section, in the same manner and to the same 
                extent as the subsections apply to transfers under 
                section 775.
                    (B) Regulations and conforming amendments.--
                Subsections (g) and (n) of section 775 shall apply to 
                transfers under this section, in the same manner and to 
                the same extent as the subsections apply to transfers 
                under section 775.
            (2) References.--For purposes of the application of the 
        subsections described in paragraph (1) (other than subsections 
        (h)(2) and (j)(2) of section 775) to transfers under this 
        section--
                    (A) references to the Federal Partnership shall be 
                deemed to be references to the appropriate receiving 
                agency, as determined in the approved or revised 
                workplan referred to in subsection (b)(2);
                    (B) references to the Director or Governing Board 
                shall be deemed to be references to the head of the 
                appropriate receiving agency; and
                    (C) references to transfers in subsections (e) and 
                (f) of section 775 shall be deemed to include transfers 
                under this section.
            (3) Administration.--Unexpended funds transferred pursuant 
        to this section shall be used only for the purposes for which 
        the funds were originally authorized and appropriated.
            (4) Continuing effect of legal documents.--All orders, 
        determinations, rules, regulations, permits, agreements, 
        grants, contracts, certificates, licenses, registrations, 
        privileges, and other administrative actions--
                    (A) that have been issued, made, granted, or 
                allowed to become effective by the President,
                 any Federal agency or official of a Federal agency, or 
by a court of competent jurisdiction, in the performance of functions 
that are transferred under this section; and
                    (B) that are in effect on the effective date of 
                this section or were final before the effective date of 
                this section and are to become effective on or after 
                the effective date of this section;
        shall continue in effect according to their terms until 
        modified, terminated, superseded, set aside, or revoked in 
        accordance with law by the President, the appropriate receiving 
        agency or other authorized official, a court of competent 
        jurisdiction, or by operation of law.
            (5) Proceedings not affected.--
                    (A) In general.--The provisions of this section 
                shall not affect any proceedings, including notices of 
                proposed rulemaking, or any application for any 
                license, permit, certificate, or financial assistance 
                pending before the Department of Labor or the 
                Department of Education on the date this section takes 
                effect, with respect to functions transferred by this 
                section.
                    (B) Continuation.--Such proceedings and 
                applications shall be continued. Orders shall be issued 
                in such proceedings, appeals shall be taken from the 
                orders, and payments shall be made pursuant to such 
                orders, as if this section had not been enacted, and 
                orders issued in any such proceedings shall continue in 
                effect until modified, terminated, superseded, or 
                revoked by a duly authorized official, by a court of 
                competent jurisdiction, or by operation of law.
                    (C) Construction.--Nothing in this paragraph shall 
                be deemed to prohibit the discontinuance or 
                modification of any such proceeding under the same 
                terms and conditions and to the same extent that such 
                proceeding could have been discontinued or modified if 
                this section had not been enacted.
            (6) Administrative actions relating to promulgation of 
        regulations.--Any administrative action relating to the 
        preparation or promulgation of a regulation by the Department 
        of Labor or the Department of Education relating to a function 
        transferred under this section may be continued by the 
        appropriate receiving agency with the same effect as if this 
        section had not been enacted.
    (d) Construction.--Nothing in this section shall be construed to 
require the transfer of any function described in subsection 
(b)(1)(B)(i) to the Federal Partnership.
    (e) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), this 
        section shall take effect on June 30, 1998.
            (2) Regulations and conforming amendments.--Subsection 
        (c)(1)(B) shall take effect on September 30, 1996.
            (3) Workplan.--Subsection (b) shall take effect on the date 
        of enactment of this Act.

SEC. 777. ELIMINATION OF CERTAIN OFFICES.

    (a) Termination.--The Office of Vocational and Adult Education and 
the Employment and Training Administration shall terminate on July 1, 
1998.
    (b) Office of Vocational and Adult Education.--
            (1) Title 5, united states code.--Section 5315 of title 5, 
        United States Code, is amended by striking ``Assistant 
        Secretaries of Education (10)'' and inserting ``Assistant 
        Secretaries of Education (9)''.
            (2) Department of education organization act.--
                    (A) Section 202 of the Department of Education 
                Organization Act (20 U.S.C. 3412) is amended--
                            (i) in subsection (b)(1)--
                                    (I) by striking subparagraph (C); 
                                and
                                    (II) by redesignating subparagraphs 
                                (D) through (F) as subparagraphs (C) 
                                through (E), respectively;
                            (ii) by striking subsection (h); and
                            (iii) by redesignating subsection (i) as 
                        subsection (h).
                    (B) Section 206 of such Act (20 U.S.C. 3416) is 
                repealed.
                    (C) Section 402(c)(1) of the Improving America's 
                Schools Act of 1994 (20 U.S.C. 9001(c)(1)) is amended 
                by striking ``established under'' and all that follows 
                and inserting a semicolon.
            (3) Goals 2000: educate america act.--Section 931(h)(3)(A) 
        of the Goals 2000: Educate America Act (20 U.S.C. 
        6031(h)(3)(A)) is amended--
                    (A) by striking clause (iii); and
                    (B) by redesignating clauses (iv) and (v) as 
                clauses (iii) and (iv), respectively.
    (c) Employment and Training Administration.--
            (1) Title 5, united states code.--Section 5315 of title 5, 
        United States Code, is amended by striking ``Assistant 
        Secretaries of Labor (10)'' and inserting ``Assistant 
        Secretaries of Labor (9)''.
            (2) Veterans' benefits and programs improvement act of 
        1988.--Section 402(d)(3) of the Veterans' Benefits and Programs 
        Improvement Act of 1988 (29 U.S.C. 1721 note) is amended by 
        striking ``and under any other program administered by the 
        Employment and Training Administration of the Department of 
        Labor''.
            (3) Title 38, united states code.--Section 4110(d) of title 
        38, United States Code, is amended--
                    (A) by striking paragraph (7); and
                    (B) by redesignating paragraphs (8) through (12) as 
                paragraphs (7) through (11), respectively.
            (4) National and community service act of 1990.--The last 
        sentence of section 162(b) of the National and Community 
        Service Act of 1990 (42 U.S.C. 12622(b)) is amended by striking 
        ``or the Office of Job Training''.
    (d) United States Employment Service.--
            (1) Title 5, united states code.--Section 3327 of title 5, 
        United States Code, is amended--
                    (A) in subsection (a), by striking ``the employment 
                offices of the United States Employment Service'' and 
                inserting ``Governors''; and
                    (B) in subsection (b), by striking ``of the United 
                States Employment Service''.
            (2) Title 10, united states code.--
                    (A) Section 1143a(d) of title 10, United States 
                Code, is amended by striking paragraph (3).
                    (B) Section 2410k(b) of title 10, United States 
                Code, is amended by striking ``, and where appropriate 
                the Interstate Job Bank (established by the United 
                States Employment Service),''.
            (3) Internal revenue code of 1986.--Section 51 of the 
        Internal Revenue Code of 1986 is amended by striking subsection 
        (g).
            (4) National defense authorization act for fiscal year 
        1993.--Section 4468 of the National Defense Authorization Act 
        for Fiscal Year 1993 (29 U.S.C. 1662d-1 note) is repealed.
            (5) Title 38, united states code.--Section 4110(d) of title 
        38, United States Code (as amended by subsection (c)(3)), is 
        further amended--
                    (A) by striking paragraph (10); and
                    (B) by redesignating paragraph (11) as paragraph 
                (10).
            (6) Title 39, united states code.--
                    (A) Section 3202(a)(1) of title 39, United States 
                Code is amended--
                            (i) in subparagraph (D), by striking the 
                        semicolon and inserting ``; and'';
                            (ii) by striking subparagraph (E); and
                            (iii) by redesignating subparagraph (F) as 
                        subparagraph (E).
                    (B) Section 3203(b) of title 39, United States 
                Code, is amended by striking ``(1)(E), (2), and (3)'' 
                and inserting ``(2) and (3)''.
                    (C) Section 3206(b) of title 39, United States 
                Code, is amended by striking ``(1)(F)'' and inserting 
                ``(1)(E)''.
            (7) National and community service act of 1990.--Section 
        162(b) of the National and Community Service Act of 1990 (42 
        U.S.C. 12622(b)) (as amended by subsection (c)(4)) is further 
        amended by striking the last sentence.
    (e) Reorganization Plans.--Except with respect to functions 
transferred under section 776, the authority granted to the Employment 
and Training Administration, the Office of Vocational and Adult 
Education, or any unit of the Employment and Training Administration or 
the Office of Vocational and Adult Education by any reorganization plan 
shall terminate on July 1, 1998.

Subtitle F--Repeals of Employment and Training and Vocational and Adult 
                           Education Programs

SEC. 781. REPEALS.

    (a) Immediate Repeals.--The following provisions are repealed:
            (1) Section 204 of the Immigration Reform and Control Act 
        of 1986 (8 U.S.C. 1255a note).
            (2) Title II of Public Law 95-250 (92 Stat. 172).
            (3) The Displaced Homemakers Self-Sufficiency Assistance 
        Act (29 U.S.C. 2301 et seq.).
            (4) Section 211 of the Appalachian Regional Development Act 
        of 1965 (40 U.S.C. App. 211).
            (5) Subtitle C of title VII of the Stewart B. McKinney 
        Homeless Assistance Act (42 U.S.C. 11441 et seq.).
            (6) Section 5322 of title 49, United States Code.
            (7) Subchapter I of chapter 421 of title 49, United States 
        Code.
    (b) Subsequent Repeals.--The following provisions are repealed:
            (1) Sections 235 and 236 of the Trade Act of 1974 (19 
        U.S.C. 2295 and 2296), and paragraphs (1) and (2) of section 
        250(d) of such Act (19 U.S.C. 2331(d)).
            (2) The Adult Education Act (20 U.S.C. 1201 et seq.).
            (3) The Carl D. Perkins Vocational and Applied Technology 
        Education Act (20 U.S.C. 2301 et seq.).
            (4) The School-to-Work Opportunities Act of 1994 (20 U.S.C. 
        6101 et seq.).
            (5) The Wagner-Peyser Act (29 U.S.C. 49 et seq.).
            (6) The Job Training Partnership Act (29 U.S.C. 1501 et 
        seq.).
            (7) Title V of the Older Americans Act of 1965 (42 U.S.C. 
        3056 et seq.).
            (8) Title VII of the Stewart B. McKinney Homeless 
        Assistance Act (42 U.S.C. 11421 et seq.), other than subtitle C 
        of such title.
    (c) Effective Dates.--
            (1) Immediate repeals.--The repeals made by subsection (a) 
        shall take effect on the date of enactment of this Act.
            (2) Subsequent repeals.--The repeals made by subsection (b) 
        shall take effect on July 1, 1998.

SEC. 782. CONFORMING AMENDMENTS.

    (a) Immediate Repeals.--
            (1) References to section 204 of the immigration reform and 
        control act of 1986.--The table of contents for the Immigration 
        Reform and Control Act of 1986 is amended by striking the item 
        relating to section 204 of such Act.
            (2) References to title ii of public law 95-250.--Section 
        103 of Public Law 95-250 (16 U.S.C. 79l) is amended--
                    (A) by striking the second sentence of subsection 
                (a); and
                    (B) by striking the second sentence of subsection 
                (b).
            (3) References to subtitle c of title vii of the stewart b. 
        mckinney homeless assistance act.--
                    (A) Section 762(a) of the Stewart B. McKinney 
                Homeless Assistance Act (42 U.S.C. 11472(a)) is 
                amended--
                            (i) by striking ``each of the following 
                        programs'' and inserting ``the emergency 
                        community services homeless grant program 
                        established in section 751''; and
                            (ii) by striking ``tribes:'' and all that 
                        follows and inserting ``tribes.''.
                    (B) The table of contents of such Act is amended by 
                striking the items relating to subtitle C of title VII 
                of such Act.
            (4) References to title 49, united states code.--
                    (A) Sections 5313(b)(1) and 5314(a)(1) of title 49, 
                United States Code, are amended by striking ``5317, and 
                5322'' and inserting ``and 5317''.
                    (B) The table of contents for chapter 53 of title 
                49, United States Code, is amended by striking the item 
                relating to section 5322.
    (b) Subsequent Repeals.--
            (1) Recommended legislation.--After consultation with the 
        appropriate committees of Congress and the Director of the 
        Office of Management and Budget, the Governing Board shall 
        prepare and submit to Congress recommended legislation 
        containing technical and conforming amendments to reflect the 
        changes made by section 781(b).
            (2) Submission to congress.--Not later than March 31, 1997, 
        the Governing Board shall submit the recommended legislation 
        referred to under paragraph (1).

 Subtitle C--Job Corps and Other Workforce Preparation Activities for 
                             At-Risk Youth

                CHAPTER 1--GENERAL JOB CORPS PROVISIONS

SEC. 741. PURPOSES.

    The purposes of this subtitle are--
            (1) to maintain a Job Corps for at-risk youth as part of 
        statewide systems;
            (2) to set forth standards and procedures for selecting 
        individuals as enrollees in the Job Corps;
            (3) to authorize the establishment of residential and 
        nonresidential Job Corps centers in which enrollees will 
        participate in intensive programs of workforce development 
        activities;
            (4) to prescribe various other powers, duties, and 
        responsibilities incident to the operation and continuing 
        development of the Job Corps; and
            (5) to assist at-risk youth who need and can benefit from 
        an unusually intensive program, operated in a group setting, to 
        become more responsible, employable, and productive citizens.

SEC. 742. DEFINITIONS.

    As used in this subtitle:
          TITLE VIII--WORKFORCE DEVELOPMENT-RELATED ACTIVITIES

        Subtitle A--Amendments to the Rehabilitation Act of 1973

SEC. 801. REFERENCES.

    Except as otherwise expressly provided in this subtitle, whenever 
in this subtitle an amendment or repeal is expressed in terms of an 
amendment to, or repeal of, a section or other provision, the reference 
shall be considered to be made to a section or other provision of the 
Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.).

SEC. 802. FINDINGS AND PURPOSES.

    Section 2 (29 U.S.C. 701) is amended--
            (1) in subsection (a)(4), by striking ``the provision of 
        individualized training, independent living services, 
        educational and support services,'' and inserting 
        ``implementation of a statewide workforce development system 
        that provides meaningful and effective participation for 
        individuals with disabilities in workforce development 
        activities and activities carried out through the vocational 
        rehabilitation program established under title I, and through 
        the provision of independent living services, support 
        services,''; and
            (2) in subsection (b)(1)(A), by inserting ``statewide 
        workforce development systems that include, as integral 
        components,'' after ``(A)''.

SEC. 803. CONSOLIDATED REHABILITATION PLAN.

    (a) In General.--Section 6 (29 U.S.C. 705) is repealed.
    (b) Conforming Amendment.--The table of contents for the Act is 
amended by striking the item relating to section 6.

SEC. 804. DEFINITIONS.

    Section 7 (29 U.S.C. 706) is amended by adding at the end the 
following new paragraphs:
    ``(36) The term `statewide workforce development system' means a 
statewide system, as defined in section 703 of the Workforce 
Development Act of 1995.
    ``(37) The term `workforce development activities' has the meaning 
given the term in section 703 of the Workforce Development Act of 1995.
    ``(38) The term `workforce employment activities' means the 
activities described in paragraphs (2) through (8) of section 716(a) of 
the Workforce Development Act of 1995, including activities described 
in section 716(a)(6) of such Act provided through a voucher described 
in section 716(a)(9) of such Act.''.

SEC. 805. ADMINISTRATION.

    Section 12(a)(1) (29 U.S.C. 711(a)(1)) is amended by inserting ``, 
including providing assistance to achieve the meaningful and effective 
participation by individuals with disabilities in the activities 
carried out through a statewide workforce development system'' before 
the semicolon.

SEC. 806. REPORTS.

    Section 13 (29 U.S.C. 712) is amended in the fourth sentence by 
striking ``The data elements'' and all that follows through ``age,'' 
and inserting the following: ``The information shall include all 
information that is required to be submitted in the report described in 
section 731(a) of the Workforce Development Act of 1995 and that 
pertains to the employment of individuals with disabilities, including 
information on age,''.

SEC. 807. EVALUATION.

    Section 14(a) (29 U.S.C. 713(a)) is amended in the third sentence 
by striking ``to the extent feasible,'' and all that follows through 
the end of the sentence and inserting the following: ``to the maximum 
extent appropriate, be consistent with the State benchmarks established 
under paragraphs (1) and (2) of section 731(c) of the Workforce 
Development Act of 1995. For purposes of this section, the Secretary 
may modify or supplement such benchmarks after consultation with the 
Governing Board established under section 771(b) of the Workforce 
Development Act of 1995, to the extent necessary to address unique 
considerations applicable to the participation of individuals with 
disabilities in the vocational rehabilitation program established under 
title I and activities carried out under other provisions of this 
Act.''.

SEC. 808. DECLARATION OF POLICY.

    Section 100(a) (29 U.S.C. 720(a)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (E), by striking ``; and'' and 
                inserting a semicolon;
                    (B) in subparagraph (F)--
                            (i) by inserting ``workforce development 
                        activities and'' before ``vocational 
                        rehabilitation services''; and
                            (ii) by striking the period and inserting 
                        ``; and''; and
                    (C) by adding at the end the following 
                subparagraph:
            ``(G) linkages between the vocational rehabilitation 
        program established under this title and other components of 
        the statewide workforce development system are critical to 
        ensure effective and meaningful participation by individuals 
        with disabilities in workforce development activities.''; and
            (2) in paragraph (2)--
                    (A) by striking ``a comprehensive'' and inserting 
                ``statewide comprehensive''; and
                    (B) by striking ``program of vocational 
                rehabilitation that is designed'' and inserting 
                ``programs of vocational rehabilitation, each of which 
                is--
            ``(A) an integral component of a statewide workforce 
        development system; and
            ``(B) designed''.

SEC. 809. STATE PLANS.

    (a) In General.--Section 101(a) (29 U.S.C. 721(a)) is amended--
            (1) in the first sentence, by striking ``, or shall 
        submit'' and all that follows through ``et seq.)'' and 
        inserting ``, and shall submit the State plan on the same dates 
        as the State submits the State plan described in section 714 of 
        the Workforce Development Act of 1995 to the Governing Board 
        established under section 771(b) of such Act'';
            (2) by inserting after the first sentence the following: 
        ``The State shall also submit the State plan for vocational 
        rehabilitation services for review and comment to any State 
        workforce development board established for the State under 
        section 715 of the Workforce Development Act of 1995, which 
        shall submit the comments on the State plan to the designated 
        State unit.'';
            (3) by striking paragraphs (10), (12), (13), (15), (17), 
        (19), (23), (27), (28), (30), (34), and (35);
            (4) in paragraph (20), by striking ``(20)'' and inserting 
        ``(B)'';
            (5) by redesignating paragraphs (3), (4), (5), (6), (7), 
        (8), (9), (14), (16), (18), (21), (22), (24), (25), (26), (29), 
        (31), (32), (33), and (36) as paragraphs (4), (5), (6), (7), 
        (8), (9), (10), (12), (13), (14), (15), (16), (17), (18), (19), 
        (20), (21), (22), (23), and (24), respectively;
            (6) in paragraph (1)(B)--
                    (A) by redesignating clauses (i), (ii), and (iii) 
                as clauses (ii), (iii), and (iv), respectively; and
                    (B) by inserting before clause (ii) (as 
                redesignated in subparagraph (A)) the following: ``(i) 
                a State entity primarily responsible for implementing 
                workforce employment activities through the statewide 
                workforce development system of the State,'';
            (7) in paragraph (2)--
                    (A) in the matter preceding subparagraph (A), by 
                striking ``(1)(B)(i)'' and inserting ``(1)(B)(ii)''; 
                and
                    (B) in subparagraph (B)(ii), by striking 
                ``(1)(B)(ii)'' and inserting ``(1)(B)(iii)'';
            (8) by inserting after paragraph (2) the following 
        paragraph:
    ``(3) provide a plan for expanding and improving vocational 
rehabilitation services for individuals with disabilities on a 
statewide basis, including--
            ``(A) a statement of values and goals;
            ``(B) evidence of ongoing efforts to use outcome measures 
        to make decisions about the effectiveness and future direction 
        of the vocational rehabilitation program established under this 
        title in the State; and
            ``(C) information on specific strategies for strengthening 
        the program as an integral component of the statewide workforce 
        development system established in the State, including specific 
        innovative, state-of-the-art approaches for achieving sustained 
        success in improving and expanding vocational rehabilitation 
        services provided through the program, for all individuals with 
        disabilities who seek employment, through plans, policies, and 
        procedures that link the program with other components of the 
        system, including plans, policies, and procedures relating to--
                    ``(i) entering into cooperative agreements, between 
                the designated State unit and appropriate entities 
                responsible for carrying out the other components of 
                the statewide workforce development system, which 
                agreements may provide for--
                            ``(I) provision of intercomponent staff 
                        training and technical assistance regarding the 
                        availability and benefits of, and eligibility 
                        standards for, vocational rehabilitation 
                        services, and regarding the provision of equal, 
                        effective, and meaningful participation by 
                        individuals with disabilities in workforce 
                        employment activities in the State through 
                        program accessibility, use of nondiscriminatory 
                        policies and procedures, and provision of 
                        reasonable accommodations, auxiliary aids and 
                        services, and rehabilitation technology, for 
                        individuals with disabilities;
                            ``(II) use of information and financial 
                        management systems that link all components of 
                        the statewide workforce development system, 
                        that link the components to other electronic 
                        networks, and that relate to such subjects as 
                        labor market information, and information on 
                        job vacancies, skill qualifications, career 
                        planning, and workforce development activities;
                            ``(III) use of customer service features 
                        such as common intake and referral procedures, 
                        customer data bases, resource information, and 
                        human service hotlines;
                            ``(IV) establishment of cooperative efforts 
                        with employers to facilitate job placement and 
                        to develop and sustain working relationships 
                        with employers, trade associations, and labor 
                        organizations;
                            ``(V) identification of staff roles and 
                        responsibilities and available resources for 
                        each entity that carries out a component of the 
                        statewide workforce development system with 
                        regard to paying for necessary services 
                        (consistent with State law); and
                            ``(VI) specification of procedures for 
                        resolving disputes among such entities; and
                    ``(ii) providing for the replication of such 
                cooperative agreements at the local level between 
                individual offices of the designated State unit and 
                local entities carrying out activities through the 
                statewide workforce development system;'';
            (9) in paragraph (6) (as redesignated in paragraph (5))--
                    (A) by striking subparagraph (A) and inserting the 
                following:
            ``(A) contain the plans, policies, and methods to be 
        followed in carrying out the State plan and in the 
        administration and supervision of the plan, including--
                    ``(i)(I) the results of a comprehensive, statewide 
                assessment of the rehabilitation needs of individuals 
                with disabilities (including individuals with severe 
                disabilities, individuals with disabilities who are 
                minorities, and individuals with disabilities who have 
                been unserved, or underserved, by the vocational 
                rehabilitation system) who are residing within the 
                State; and
                    ``(II) the response of the State to the assessment;
                    ``(ii) a description of the method to be used to 
                expand and improve services to individuals with the 
                most severe disabilities, including individuals served 
                under part C of title VI;
                    ``(iii) with regard to community rehabilitation 
                programs--
                            ``(I) a description of the method to be 
                        used (such as a cooperative agreement) to 
                        utilize the programs to the maximum extent 
                        feasible; and
                            ``(II) a description of the needs of the 
                        programs, including the community 
                        rehabilitation programs funded under the Act 
                        entitled ``An Act to Create a Committee on 
                        Purchases of Blind-made Products, and for other 
                        purposes'', approved June 25, 1938 (commonly 
                        known as the Wagner-O'Day Act; 41 U.S.C. 46 et 
                        seq.) and such programs funded by State use 
                        contracting programs; and
                    ``(iv) an explanation of the methods by which the 
                State will provide vocational rehabilitation services 
                to all individuals with disabilities within the State 
                who
                 are eligible for such services, and, in the event that 
vocational rehabilitation services cannot be provided to all such 
eligible individuals with disabilities who apply for such services, 
information--
                            ``(I) showing and providing the 
                        justification for the order to be followed in 
                        selecting individuals to whom vocational 
                        rehabilitation services will be provided (which 
                        order of selection for the provision of 
                        vocational rehabilitation services shall be 
                        determined on the basis of serving first the 
                        individuals with the most severe disabilities 
                        in accordance with criteria established by the 
                        State, and shall be consistent with priorities 
                        in such order of selection so determined, and 
                        outcome and service goals for serving 
                        individuals with disabilities, established in 
                        regulations prescribed by the Commissioner);
                            ``(II) showing the outcomes and service 
                        goals, and the time within which the outcomes 
                        and service goals may be achieved, for the 
                        rehabilitation of individuals receiving such 
                        services; and
                            ``(III) describing how individuals with 
                        disabilities who will not receive such services 
                        if such order is in effect will be referred to 
                        other components of the statewide workforce 
                        development system for access to services 
                        offered by the components;''; and
                    (B) by striking subparagraph (C) and inserting the 
                following subparagraphs:
            ``(C) with regard to the statewide assessment of 
        rehabilitation needs described in subparagraph (A)(i)--
                    ``(i) provide that the State agency will make 
                reports at such time, in such manner, and containing 
                such information, as the Commissioner may require to 
                carry out the functions of the Commissioner under this 
                title, and comply with such provisions as are necessary 
                to assure the correctness and verification of such 
                reports; and
                    ``(ii) provide that reports made under clause (i) 
                will include information regarding individuals with 
                disabilities and, if an order of selection described in 
                subparagraph (A)(iv)(I) is in effect in the State, will 
                separately include information regarding individuals 
                with the most severe disabilities, on--
                            ``(I) the number of such individuals who 
                        are evaluated and the number rehabilitated;
                            ``(II) the costs of administration, 
                        counseling, provision of direct services, 
                        development of community rehabilitation 
                        programs, and other functions carried out under 
                        this Act; and
                            ``(III) the utilization by such individuals 
                        of other programs pursuant to paragraph (11); 
                        and
            ``(D) describe--
                    ``(i) how a broad range of rehabilitation 
                technology services will be provided at each stage of 
                the rehabilitation process;
                    ``(ii) how a broad range of such rehabilitation 
                technology services will be provided on a statewide 
                basis; and
                    ``(iii) the training that will be provided to 
                vocational rehabilitation counselors, client assistance 
                personnel, personnel of the providers of one-stop 
                delivery of core services described in section 
                716(a)(2) of the Workforce Development Act of 1995, and 
                other related services personnel;'';
            (10) in subparagraph (A) of paragraph (8) (as redesignated 
        in paragraph (5))--
                    (A) in clause (i)(II), by striking ``, based on 
                projections'' and all that follows through ``relevant 
                factors''; and
                    (B) by striking clauses (iii) and (iv) and 
                inserting the following clauses:
            ``(iii) a description of the ways in which the system for 
        evaluating the performance of rehabilitation counselors, 
        coordinators, and other personnel used in the State facilitates 
        the accomplishment of the purpose and policy of this title, 
        including the policy of serving, among others, individuals with 
        the most severe disabilities;
            ``(iv) provide satisfactory assurances that the system 
        described in clause (iii) in no way impedes such 
        accomplishment; and'';
            (11) in paragraph (9) (as redesignated in paragraph (5)) by 
        striking ``required--'' and all that follows through ``(B) 
        prior'' and inserting ``required prior'';
            (12) in paragraph (10) (as redesignated in paragraph (5))--
                    (A) in subparagraph (B), by striking ``written 
                rehabilitation program'' and inserting ``employment 
                plan''; and
                    (B) in subparagraph (C), by striking ``plan in 
                accordance with such program'' and inserting ``State 
                plan in accordance with the employment plan'';
            (13) in paragraph (11)--
                    (A) in subparagraph (A), by striking ``State's 
                public'' and all that follows and inserting ``State 
                programs that are not part of the statewide workforce 
                development system of the State;''; and
                    (B) in subparagraph (C)--
                            (i) by striking ``if appropriate--'' and 
                        all that follows through ``entering into'' and 
                        inserting ``if appropriate, entering into'';
                            (ii) by redesignating subclauses (I), (II), 
                        and (III) as clauses (i), (ii), and (iii), 
                        respectively; and
                            (iii) by indenting the clauses and aligning 
                        the margins of the clauses with the margins of 
                        clause (ii) of subparagraph (A) of paragraph 
                        (8) (as redesignated in paragraph (5));
            (14) in paragraph (14) (as redesignated in paragraph (5))--
                    (A) by striking ``(14)'' and inserting ``(14)(A)''; 
                and
                    (B) by inserting before the semicolon the following 
                ``, and, in the case of the designated State unit, will 
                take actions to take such views into account that 
                include providing timely notice, holding public 
                hearings, preparing a summary of hearing comments, and 
                documenting and disseminating information relating to 
                the manner in which the comments will affect services; 
                and'';
            (15) in paragraph (16) (as redesignated in paragraph (5)), 
        by striking ``referrals to other Federal and State programs'' 
        and inserting ``referrals within the statewide workforce 
        development system of the State to programs''; and
            (16) in paragraph (17) (as redesignated in paragraph (5))--
                    (A) in subparagraph (B), by striking ``written 
                rehabilitation program'' and inserting ``employment 
                plan''; and
                    (B) in subparagraph (C)--
                            (i) in clause (ii), by striking ``; and'' 
                        and inserting a semicolon;
                            (ii) in clause (iii), by striking the 
                        semicolon and inserting ``; and''; and
                            (iii) by adding at the end the following 
                        clause:
                    ``(iv) the manner in which students who are 
                individuals with disabilities and who are not in 
                special education programs can access and receive 
                vocational rehabilitation services, where 
                appropriate;''.
    (b) Conforming Amendments.--
            (1) Section 7 (29 U.S.C. 706) is amended--
                    (A) in paragraph (3)(B)(ii), by striking 
                ``101(a)(1)(B)(i)'' and inserting ``101(a)(1)(B)(ii)''; 
                and
                    (B) in paragraph (22)(A)(i)(II), by striking 
                ``101(a)(5)(A)'' each place it appears and inserting 
                ``101(a)(6)(A)(iv)''.
            (2) Section 12(d) (29 U.S.C. 711(d)) is amended by striking 
        ``101(a)(5)(A)'' and inserting ``101(a)(6)(A)(iv)''.
            (3) Section 101(a) (29 U.S.C. 721(a)) is amended--
                    (A) in paragraph (1)(A), by striking ``paragraph 
                (4) of this subsection'' and inserting ``paragraph 
                (5)'';
                    (B) in paragraph (2)--
                            (i) in the matter preceding subparagraph 
                        (A), by striking ``paragraph (1)(B)(i)'' and 
                        inserting ``paragraph (1)(B)(ii)''; and
                            (ii) in subparagraph (B)(i), by striking 
                        ``paragraph (1)(B)(ii)'' and inserting 
                        ``paragraph (1)(B)(iii)'';
                    (C) in paragraph (17) (as redesignated in 
                subsection (a)(5)), by striking ``paragraph 
                (11)(C)(ii)'' and inserting ``paragraph (11)(C)'';
                    (D) in paragraph (22) (as redesignated in 
                subsection (a)(5)), by striking ``paragraph (36)'' and 
                inserting ``paragraph (24)''; and
                    (E) in subparagraph (C) of paragraph (24) (as 
                redesignated in subsection (a)(5)), by striking 
                ``101(a)(1)(A)(i)'' and inserting ``paragraph 
                (1)(A)(i)''.
            (4) Section 102 (29 U.S.C. 722) is amended--
                    (A) in subsection (a)(3), by striking 
                ``101(a)(24)'' and inserting ``101(a)(17)''; and
                    (B) in subsection (d)(2)(C)(ii)--
                            (i) in subclause (II), by striking 
                        ``101(a)(36)'' and inserting ``101(a)(24)''; 
                        and
                            (ii) in subclause (III), by striking 
                        ``101(a)(36)(C)(ii)'' and inserting 
                        ``101(a)(24)(C)(ii)''.
            (5) Section 105(a)(1) (29 U.S.C. 725(a)(1)) is amended by 
        striking ``101(a)(36)'' and inserting ``101(a)(24)''.
            (6) Section 107(a) (29 U.S.C. 727(a)) is amended--
                    (A) in paragraph (2)(F), by striking ``101(a)(32)'' 
                and inserting ``101(a)(22)'';
                    (B) in paragraph (3)(A), by striking 
                ``101(a)(5)(A)'' and inserting ``101(a)(6)(A)(iv)''; 
                and
                    (C) in paragraph (4), by striking ``101(a)(35)'' 
                and inserting ``101(a)(8)(A)(iii)''.
            (7) Section 111(a) (29 U.S.C. 731(a)) is amended--
                    (A) in paragraph (1), by striking ``and development 
                and implementation'' and all that follows through 
                ``referred to in section 101(a)(34)(B)''; and
                    (B) in paragraph (2)(A), by striking ``and such 
                payments shall not be made in an amount which would 
                result in a violation of the provisions of the State 
                plan required by section 101(a)(17)''.
            (8) Section 124(a)(1)(A) (29 U.S.C. 744(a)(1)(A)) is 
        amended by striking ``(not including sums used in accordance 
        with section 101(a)(34)(B))''.
            (9) Section 315(b)(2) (29 U.S.C. 777e(b)(2)) is amended by 
        striking ``101(a)(22)'' and inserting ``101(a)(16)''.
            (10) Section 635(b)(2) (29 U.S.C. 795n(b)(2)) is amended by 
        striking ``101(a)(5)'' and inserting ``101(a)(6)(A)(i)(I)''.
            (11) Section 802(h)(2)(B)(ii) (29 U.S.C. 797a(h)(2)(B)(ii)) 
        is amended by striking ``101(a)(5)(A)'' and inserting 
        ``101(a)(6)(A)(iv)''.
            (12) Section 102(e)(23)(A) of the Technology-Related 
        Assistance for Individuals With Disabilities Act of 1988 (29 
        U.S.C. 2212(e)(23)(A)) is amended by striking ``section 
        101(a)(36) of the Rehabilitation Act of 1973 (29 U.S.C. 
        721(a)(36))'' and inserting ``section 101(a)(24) of the 
        Rehabilitation Act of 1973 (29 U.S.C. 721(a)(24))''.
SEC. 810. INDIVIDUALIZED EMPLOYMENT PLANS.

    (a) In General.--Section 102 (29 U.S.C. 722) is amended--
            (1) by striking the section heading and inserting the 
        following:

``SEC. 102. INDIVIDUALIZED EMPLOYMENT PLANS.'';

            (2) in subsection (a)(6), by striking ``written 
        rehabilitation program'' and inserting ``employment plan'';
            (3) in subsection (b)--
                    (A) in paragraph (1)(A)--
                            (i) in clause (i), by striking ``written 
                        rehabilitation program'' and inserting 
                        ``employment plan''; and
                            (ii) in clause (ii), by striking 
                        ``program'' and inserting ``plan'';
                    (B) in paragraph (1)(B)--
                            (i) in the matter preceding clause (i), by 
                        striking ``written rehabilitation program'' and 
                        inserting ``employment plan'';
                            (ii) in clause (iv)--
                                    (I) by striking subclause (I) and 
                                inserting the following:
            ``(I) include a statement of the specific vocational 
        rehabilitation services to be provided (including, if 
        appropriate, rehabilitation technology services and training in 
        how to use such services) that includes specification of the 
        public or private entity that will provide each such vocational 
        rehabilitation service and the projected dates for the 
        initiation and the anticipated duration of each such service; 
        and'';
                                    (II) by striking subclause (II); 
                                and
                                    (III) by redesignating subclause 
                                (III) as subclause (II); and
                            (iii) in clause (xi)(I), by striking 
                        ``program'' and inserting ``plan'';
                    (C) in paragraph (1)(C), by striking ``written 
                rehabilitation program and amendments to the program'' 
                and inserting ``employment plan and amendments to the 
                plan''; and
                    (D) in paragraph (2)--
                            (i) by striking ``program'' each place the 
                        term appears and inserting ``plan''; and
                            (ii) by striking ``written rehabilitation'' 
                        each place the term appears and inserting 
                        ``employment'';
            (4) in subsection (c)--
                    (A) in paragraph (1), by striking ``written 
                rehabilitation program'' and inserting ``employment 
                plan''; and
                    (B) by striking ``written program'' each place the 
                term appears and inserting ``plan''; and
            (5) in subsection (d)--
                    (A) in paragraph (5), by striking ``written 
                rehabilitation program'' and inserting ``employment 
                plan''; and
                    (B) in paragraph (6)(A), by striking the second 
                sentence.
    (b) Conforming Amendments.--
            (1) The table of contents for the Act is amended by 
        striking the item relating to section 102 and inserting the 
        following:

``Sec. 102. Individualized employment plans.''.
            (2) Paragraphs (22)(B) and (27)(B), and subparagraphs (B) 
        and (C) of paragraph (34) of section 7 (29 U.S.C. 706), section 
        12(e)(1) (29 U.S.C. 711(e)(1)), section 501(e) (29 U.S.C. 
        791(e)), subparagraphs (C), (D), and (E) of section 635(b)(6) 
        (29 U.S.C. 795n(b)(6) (C), (D), and (E)), section 802(g)(8)(B) 
        (29 U.S.C. 797a(g)(8)(B)), and section 803(c)(2)(D) (29 U.S.C. 
        797b(c)(2)(D)) are amended by striking ``written rehabilitation 
        program'' each place the term appears and inserting 
        ``employment plan''.
            (3) Section 7(22)(B)(i) (29 U.S.C. 706(22)(B)(i)) is 
        amended by striking ``rehabilitation program'' and inserting 
        ``employment plan''.
            (4) Section 107(a)(3)(D) (29 U.S.C. 727(a)(3)(D)) is 
        amended by striking ``written rehabilitation programs'' and 
        inserting ``employment plans''.
            (5) Section 101(b)(7)(A)(ii)(II) of the Technology-Related 
        Assistance for Individuals With Disabilities Act of 1988 (29 
        U.S.C. 2211(b)(7)(A)(ii)(II)) is amended by striking ``written 
        rehabilitation program'' and inserting ``employment plan''.

SEC. 811. SCOPE OF VOCATIONAL REHABILITATION SERVICES.

    Section 103 (29 U.S.C. 723) is amended--
            (1) in subsection (a)(4)--
                    (A) in subparagraph (B), by striking ``surgery 
                or'';
                    (B) in subparagraph (D), by striking the comma at 
                the end and inserting ``, and'';
                    (C) by striking subparagraph (E); and
                    (D) by redesignating subparagraph (F) as 
                subparagraph (E); and
            (2) in subsection (b)(1), by striking ``the most severe''.

SEC. 812. STATE REHABILITATION ADVISORY COUNCIL.

    (a) In General.--Section 105 (29 U.S.C. 725) is amended--
            (1) in subsection (b)(1)(A)(vi), by inserting before the 
        semicolon the following: ``who, to the extent feasible, are 
        members of any State workforce development board established 
        for the State under section 715 of the Workforce Development 
        Act of 1995''; and
            (2) in subsection (c)--
                    (A) by redesignating paragraphs (3) through (7) as 
                paragraphs (4) through (8), respectively;
                    (B) by inserting after paragraph (2) the following 
                new paragraph:
            ``(3) advise the designated State agency and the designated 
        State unit regarding strategies for ensuring that the 
        vocational rehabilitation program established under this title 
        becomes an integral part of the statewide workforce development 
        system of the State;''; and
                    (C) in paragraph (6) (as redesignated in 
                subparagraph (A))--
                            (i) by striking ``6024), and'' and 
                        inserting ``6024),''; and
                            (ii) by striking the semicolon at the end 
                        and inserting the following: ``, and any State 
                        workforce development board established for the 
                        State under section 715 of the Workforce 
                        Development Act of 1995;''.
    (b) Conforming Amendment.--Subparagraph (B)(iv), and clauses 
(ii)(I) and (iii)(I) of subparagraph (C), of paragraph (24) (as 
redesignated in section 409(a)(5)) of section 101(a) (29 U.S.C. 721(a)) 
are amended by striking ``105(c)(3)'' and inserting ``105(c)(4)''.

SEC. 813. EVALUATION STANDARDS AND PERFORMANCE INDICATORS.

    Section 106(a)(1) (29 U.S.C. 726(a)(1)) is amended--
            (1) by striking ``1994'' and inserting ``1996''; and
            (2) by striking the period and inserting the following: 
        ``that shall, to the maximum extent appropriate, be consistent 
        with the State benchmarks established under paragraphs (1) and 
        (2) of section 731(c) of the Workforce Development Act of 1995. 
        For purposes of this section, the Commissioner may modify or 
        supplement such benchmarks, after consultation with the 
        Governing Board established under section 771(b) of the 
        Workforce Development Act of 1995, to the extent necessary to 
        address unique considerations applicable to the participation 
        of individuals with disabilities in the vocational 
        rehabilitation program.''.

SEC. 814. REPEALS.

    (a) In General.--Title I (29 U.S.C. 720 et seq.) is amended--
            (1) by repealing part C; and
            (2) by redesignating parts D and E as parts C and D, 
        respectively.
    (b) Conforming Amendments.--The table of contents for the Act is 
amended--
            (1) by striking the items relating to part C of title I; 
        and
            (2) by striking the items relating to parts D and E of 
        title I and inserting the following:
      ``Part C--American Indian Vocational Rehabilitation Services

``Sec. 130. Vocational rehabilitation services grants.
    ``Part D--Vocational Rehabilitation Services Client Information

``Sec. 140. Review of data collection and reporting system.
``Sec. 141. Exchange of data.''.
SEC. 815. EFFECTIVE DATE.

    (a) In General.--Except as provided in subsection (b), the 
amendments made by this subtitle shall take effect on the date of 
enactment of this Act.
    (b) Statewide System Requirements.--The changes made in the 
Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) by the amendments 
made by this subtitle that relate to State benchmarks, or other 
components of a statewide system, shall take effect--
            (1) in a State that submits and obtains approval of an 
        interim plan under section 762 for program year 1997, on July 
        1, 1997; and
            (2) in any other State, on July 1, 1998.

       Subtitle B--Amendments to Immigration and Nationality Act

SEC. 821. PROHIBITION ON USE OF FUNDS FOR CERTAIN EMPLOYMENT 
              ACTIVITIES.

    Section 412(c)(1) of the Immigration and Nationality Act is amended 
by adding at the end the following new subparagraph:
    ``(D) Funds available under this paragraph may not be provided to 
States for workforce employment activities authorized and funded under 
the Workforce Development Act of 1995.''.
                        TITLE IX--CHILD SUPPORT

SEC. 900. REFERENCE TO SOCIAL SECURITY ACT.

    Except as otherwise specifically provided, whenever in this title 
an amendment is expressed in terms of an amendment to or repeal of a 
section or other provision, the reference shall be considered to be 
made to that section or other provision of the Social Security Act.

     Subtitle A--Eligibility for Services; Distribution of Payments

SEC. 901. STATE OBLIGATION TO PROVIDE CHILD SUPPORT ENFORCEMENT 
              SERVICES.

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

SEC. 902. DISTRIBUTION OF CHILD SUPPORT COLLECTIONS.

    (a) In General.--Section 457 (42 U.S.C. 657) is amended to read as 
follows:

``SEC. 457. DISTRIBUTION OF COLLECTED SUPPORT.

    ``(a) In General.--An amount collected on behalf of a family as 
support by a State pursuant to a plan approved under this part shall be 
distributed as follows:
            ``(1) Families receiving assistance.--In the case of a 
        family receiving assistance from the State, the State shall--
                    ``(A) retain, or distribute to the family, the 
                State share of the amount so collected; and
                    ``(B) pay to the Federal Government the Federal 
                share of the amount so collected.
            ``(2) Families that formerly received assistance.--In the 
        case of a family that formerly received assistance from the 
        State:
                    ``(A) Current support payments.--The State shall, 
                with regard to amounts collected which represent 
                amounts owed for the current month, distribute the 
                amounts so collected to the family.
                    ``(B) Payment of arrearages.--The State shall, with 
                regard to amounts collected which exceed amounts owed 
                for the current month, distribute the amounts so 
                collected as follows:
                            ``(i) Distribution to the family to satisfy 
                        arrearages that accrued after the family 
                        received assistance.--The State shall 
                        distribute the amount so collected to the 
                        family to the extent necessary to satisfy any 
                        support arrearages with respect to the family 
                        that accrued after the family stopped receiving 
                        assistance from the State.
                            ``(ii) Distribution to the family to 
                        satisfy arrearages that accrued before or while 
                        the family received assistance to the extent 
                        payments exceed assistance received.--In the 
                        case of arrearages of support obligations with 
                        respect to the family that were assigned to the 
                        State making the collection, as a condition of 
                        receiving assistance from the State, and which 
                        accrued before or while the family received 
                        such assistance, the State may retain all or a 
                        part of the State share and if the State does 
                        so retain, shall retain and pay to the Federal 
                        Government the Federal share of amounts so 
                        collected, to the extent the amount so retained 
                        does not exceed the amount of assistance 
                        provided to the family by the State.
                            ``(iii) Distribution of the remainder to 
                        the family.--To the extent that neither clause 
                        (i) nor clause (ii) applies to the amount so 
                        collected, the State shall distribute the 
                        amount to the family.
            ``(3) Families that never received assistance.--In the case 
        of any other family, the State shall distribute the amount so 
        collected to the family.
    ``(b) Transition Rule.--Any rights to support obligations which 
were assigned to a State as a condition of receiving assistance from 
the State under part A before the effective date of the Work 
Opportunity Act of 1995 shall remain assigned after such date.
    ``(c) Definitions.--As used in subsection (a):
            ``(1) Assistance.--The term `assistance from the State' 
        means--
                    ``(A) assistance under the State program funded 
                under part A or under the State plan approved under 
                part A of this title (as in effect before October 1, 
                1995); or
                    ``(B) benefits under the State plan approved under 
                part B or E of this title.
            ``(2) Federal share.--The term `Federal share' means, with 
        respect to an amount collected by the State to satisfy a 
        support obligation owed to a family for a time period--
                    ``(A) the greatest Federal medical assistance 
                percentage in effect for the State for fiscal year 1995 
                or any succeeding fiscal year; or
                    ``(B) if support is not owed to the family for any 
                month for which the family received aid to families 
                with dependent children under the State plan approved 
                under part A of this title (as in effect before October 
                1, 1995), the Federal reimbursement percentage for the 
                fiscal year in which the time period occurs.
            ``(3) Federal medical assistance percentage.--The term 
        `Federal medical assistance percentage' means--
                    ``(A) the Federal medical assistance percentage (as 
                defined in section 1905(b)) in the case of any State 
                for which subparagraph (B) does not apply; or
                    ``(B) the Federal medical assistance percentage (as 
                defined in section 1118), in the case of Puerto Rico, 
                the Virgin Islands, Guam, and American Samoa.
            ``(4) Federal reimbursement percentage.--The term `Federal 
        reimbursement percentage' means, with respect to a fiscal 
        year--
                    ``(A) the total amount paid to the State under 
                section 403 for the fiscal year; divided by
                    ``(B) the total amount expended by the State to 
                carry out the State program under part A during the 
                fiscal year.
            ``(5) State share.--The term `State share' means 100 
        percent minus the Federal share.''.
    (b) Clerical Amendments.--Section 454 (42 U.S.C. 654) is amended--
            (1) in paragraph (11)--
                    (A) by striking ``(11)'' and inserting ``(11)(A)''; 
                and
                    (B) by inserting after the semicolon ``and''; and
            (2) by redesignating paragraph (12) as subparagraph (B) of 
        paragraph (11).
    (c) Effective Date.--
            (1) General rule.--Except as provided in paragraphs (2) and 
        (3), the amendment made by subsection (a) shall become 
        effective on October 1, 1999.
            (2) Earlier effective date for rules relating to 
        distribution of support collected for families receiving 
        assistance.--Section 457(a)(1) of the Social Security Act, as 
        added by the amendment made by subsection (a), shall become 
        effective on October 1, 1995.
            (3) Special rule.--A State may elect to have the amendment 
        made by subsection (a) become effective on a date earlier than 
        October 1, 1999, which date shall coincide with the operation 
        of the single statewide automated data processing and 
        information retrieval system required by section 454A of the 
        Social Security Act (as added by section 944(a)(2)) and the 
        State disbursement unit required by section 454B of the Social 
        Security Act (as added by section 912(b)), and the existence of 
        State requirements for assignment of support as a condition of 
        eligibility for assistance under part A of the Social Security 
        Act (as added by title I).
            (4) Clerical amendments.--The amendments made by subsection 
        (b) shall become effective on October 1, 1995.

SEC. 903. RIGHTS TO NOTIFICATION AND HEARINGS.

    (a) In General.--Section 454 (42 U.S.C. 654), as amended by section 
902(b), is amended by inserting after paragraph (11) the following new 
paragraph:
            ``(12) establish procedures to provide that--
                    ``(A) individuals who are applying for or receiving 
                services under this part, or are parties to cases in 
                which services are being provided under this part--
                            ``(i) receive notice of all proceedings in 
                        which support obligations might be established 
                        or modified; and
                            ``(ii) receive a copy of any order 
                        establishing or modifying a child support 
                        obligation, or (in the case of a petition for 
                        modification) a notice of determination that 
                        there should be no change in the amount of the 
                        child support award, within 14 days after 
                        issuance of such order or determination; and
                    ``(B) individuals applying for or receiving 
                services under this part have access to a fair hearing 
                or other formal complaint procedure that meets 
                standards established by the Secretary and ensures 
                prompt consideration and resolution of complaints (but 
                the resort to such procedure shall not stay the 
                enforcement of any support order);''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
become effective on October 1, 1997.

SEC. 904. PRIVACY SAFEGUARDS.

    (a) State Plan Requirement.--Section 454 (42 U.S.C. 654), as 
amended by section 901(b), is amended--
            (1) by striking ``and'' at the end of paragraph (24);
            (2) by striking the period at the end of paragraph (25) and 
        inserting ``; and''; and
            (3) by adding after paragraph (25) the following new 
        paragraph:
            ``(26) will have in effect safeguards, applicable to all 
        confidential information handled by the State agency, that are 
        designed to protect the privacy rights of the parties, 
        including--
                    ``(A) safeguards against unauthorized use or 
                disclosure of information relating to proceedings or 
                actions to establish paternity, or to establish or 
                enforce support;
                    ``(B) prohibitions against the release of 
                information on the whereabouts of 1 party to another 
                party against whom a protective order with respect to 
                the former party has been entered; and
                    ``(C) prohibitions against the release of 
                information on the whereabouts of 1 party to another 
                party if the State has reason to believe that the 
                release of the information may result in physical or 
                emotional harm to the former party.''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
become effective on October 1, 1997.

                  Subtitle B--Locate and Case Tracking

SEC. 911. STATE CASE REGISTRY.

    Section 454A, as added by section 944(a)(2), is amended by adding 
at the end the following new subsections:
    ``(e) State Case Registry.--
            ``(1) Contents.--The automated system required by this 
        section shall include a registry (which shall be known as the 
        `State case registry') that contains records with respect to--
                    ``(A) each case in which services are being 
                provided by the State agency under the State plan 
                approved under this part; and
                    ``(B) each support order established or modified in 
                the State on or after October 1, 1998.
            ``(2) Linking of local registries.--The State case registry 
        may be established by linking local case registries of support 
        orders through an automated information network, subject to 
        this section.
            ``(3) Use of standardized data elements.--Such records 
        shall use standardized data elements for both parents (such as 
        names, social security numbers and other uniform identification 
        numbers, dates of birth, and case identification numbers), and 
        contain such other information (such as on-case status) as the 
        Secretary may require.
            ``(4) Payment records.--Each case record in the State case 
        registry with respect to which services are being provided 
        under the State plan approved under this part and with respect 
        to which a support order has been established shall include a 
        record of--
                    ``(A) the amount of monthly (or other periodic) 
                support owed under the order, and other amounts 
                (including arrearages, interest or late payment 
                penalties, and fees) due or overdue under the order;
                    ``(B) any amount described in subparagraph (A) that 
                has been collected;
                    ``(C) the distribution of such collected amounts;
                    ``(D) the birth date of any child for whom the 
                order requires the provision of support; and
                    ``(E) the amount of any lien imposed with respect 
                to the order pursuant to section 466(a)(4).
            ``(5) Updating and monitoring.--The State agency operating 
        the automated system required by this section shall promptly 
        establish and maintain, and regularly monitor, case records in 
        the State case registry with respect to which services are 
        being provided under the State plan approved under this part, 
        on the basis of--
                    ``(A) information on administrative actions and 
                administrative and judicial proceedings and orders 
                relating to paternity and support;
                    ``(B) information obtained from comparison with 
                Federal, State, or local sources of information;
                    ``(C) information on support collections and 
                distributions; and
                    ``(D) any other relevant information.
    ``(f) Information Comparisons and Other Disclosures of 
Information.--The State shall use the automated system required by this 
section to extract information from (at such times, and in such 
standardized format or formats, as may be required by the Secretary), 
to share and compare information with, and to receive information from, 
other data bases and information comparison services, in order to 
obtain (or provide) information necessary to enable the State agency 
(or the Secretary or other State or Federal agencies) to carry out this 
part, subject to section 6103 of the Internal Revenue Code of 1986. 
Such information comparison activities shall include the following:
            ``(1) Federal case registry of child support orders.--
        Furnishing to the Federal Case Registry of Child Support Orders 
        established under section 453(h) (and update as necessary, with 
        information including notice of expiration of orders) the 
        minimum amount of information on child support cases recorded 
        in the State case registry that is necessary to operate the 
        registry (as specified by the Secretary in regulations).
            ``(2) Federal parent locator service.--Exchanging 
        information with the Federal Parent Locator Service for the 
        purposes specified in section 453.
            ``(3) Temporary family assistance and medicaid agencies.--
        Exchanging information with State agencies (of the State and of 
        other States) administering programs funded under part A, 
        programs operated under State plans under title XIX, and other 
        programs designated by the Secretary, as necessary to perform 
        State agency responsibilities under this part and under such 
        programs.
            ``(4) Intrastate and interstate information comparisons.--
        Exchanging information with other agencies of the State, 
        agencies of other States, and interstate information networks, 
        as necessary and appropriate to carry out (or assist other 
        States to carry out) the purposes of this part.''.

SEC. 912. COLLECTION AND DISBURSEMENT OF SUPPORT PAYMENTS.

    (a) State Plan Requirement.--Section 454 (42 U.S.C. 654), as 
amended by sections 901(b) and 904(a), is amended--
            (1) by striking ``and'' at the end of paragraph (25);
            (2) by striking the period at the end of paragraph (26) and 
        inserting ``; and''; and
            (3) by adding after paragraph (26) the following new 
        paragraph:
            ``(27) provide that, on and after October 1, 1998, the 
        State agency will--
                    ``(A) operate a State disbursement unit in 
                accordance with section 454B; and
                    ``(B) have sufficient State staff (consisting of 
                State employees), and (at State option) contractors 
                reporting directly to the State agency, to--
                            ``(i) monitor and enforce support 
                        collections through the unit (including 
                        carrying out the automated data processing 
                        responsibilities described in section 454A(g)); 
                        and
                            ``(ii) take the actions described in 
                        section 466(c)(1) in appropriate cases.''.
    (b) Establishment of State Disbursement Unit.--Part D of title IV 
(42 U.S.C. 651-669), as amended by section 944(a)(2), is amended by 
inserting after section 454A the following new section:

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

    ``(a) State Disbursement Unit.--
            ``(1) In general.--In order for a State to meet the 
        requirements of this section, the State agency must establish 
        and operate a unit (which shall be known as the `State 
        disbursement unit') for the collection and disbursement of 
        payments under support orders in all cases being enforced by 
        the State pursuant to section 454(4).
            ``(2) Operation.--The State disbursement unit shall be 
        operated--
                    ``(A) directly by the State agency (or 2 or more 
                State agencies under a regional cooperative agreement), 
                or (to the extent appropriate) by a contractor 
                responsible directly to the State agency; and
                    ``(B) in coordination with the automated system 
                established by the State pursuant to section 454A.
            ``(3) Linking of local disbursement units.--The State 
        disbursement unit may be established by linking local 
        disbursement units through an automated information network, 
        subject to this section. The Secretary must agree that the 
        system will not cost more nor take more time to establish or 
        operate than a centralized system. In addition, employers shall 
        be given 1 location to which income withholding is sent.
    ``(b) Required Procedures.--The State disbursement unit shall use 
automated procedures, electronic processes, and computer-driven 
technology to the maximum extent feasible, efficient, and economical, 
for the collection and disbursement of support payments, including 
procedures--
            ``(1) for receipt of payments from parents, employers, and 
        other States, and for disbursements to custodial parents and 
        other obligees, the State agency, and the agencies of other 
        States;
            ``(2) for accurate identification of payments;
            ``(3) to ensure prompt disbursement of the custodial 
        parent's share of any payment; and
            ``(4) to furnish to any parent, upon request, timely 
        information on the current status of support payments under an 
        order requiring payments to be made by or to the parent.
    ``(c) Timing of Disbursements.--
            ``(1) In general.--Except as provided in paragraph (2), the 
        State disbursement unit shall distribute all amounts payable 
        under section 457(a) within 2 business days after receipt from 
        the employer or other source of periodic income, if sufficient 
        information identifying the payee is provided.
            ``(2) Permissive retention of arrearages.--The State 
        disbursement unit may delay the distribution of collections 
        toward arrearages until the resolution of any timely appeal 
        with respect to such arrearages.
    ``(d) Business Day Defined.--As used in this section, the term 
`business day' means a day on which State offices are open for regular 
business.''.
    (c) Use of Automated System.--Section 454A, as added by section 
944(a)(2) and as amended by section 911, is amended by adding at the 
end the following new subsection:
    ``(g) Collection and Distribution of Support Payments.--
            ``(1) In general.--The State shall use the automated system 
        required by this section, to the maximum extent feasible, to 
        assist and facilitate the collection and disbursement of 
        support payments through the State disbursement unit operated 
        under section 454B, through the performance of functions, 
        including, at a minimum--
                    ``(A) transmission of orders and notices to 
                employers (and other debtors) for the withholding of 
                wages and other income--
                            ``(i) within 2 business days after receipt 
                        from a court, another State, an employer, the 
                        Federal Parent Locator Service, or another 
                        source recognized by the State of notice of, 
                        and the income source subject to, such 
                        withholding; and
                            ``(ii) using uniform formats prescribed by 
                        the Secretary;
                    ``(B) ongoing monitoring to promptly identify 
                failures to make timely payment of support; and
                    ``(C) automatic use of enforcement procedures 
                (including procedures authorized pursuant to section 
                466(c)) where payments are not timely made.
            ``(2) Business day defined.--As used in paragraph (1), the 
        term `business day' means a day on which State offices are open 
        for regular business.''.
    (d) Effective Date.--The amendments made by this section shall 
become effective on October 1, 1998.

SEC. 913. STATE DIRECTORY OF NEW HIRES.

    (a) State Plan Requirement.--Section 454 (42 U.S.C. 654), as 
amended by sections 901(b), 904(a) and 912(a), is amended--
            (1) by striking ``and'' at the end of paragraph (26);
            (2) by striking the period at the end of paragraph (27) and 
        inserting ``; and''; and
            (3) by adding after paragraph (27) the following new 
        paragraph:
            ``(28) provide that, on and after October 1, 1997, the 
        State will operate a State Directory of New Hires in accordance 
        with section 453A.''.
    (b) State Directory of New Hires.--Part D of title IV (42 U.S.C. 
651-669) is amended by inserting after section 453 the following new 
section:

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

    ``(a) Establishment.--
            ``(1) In general.--Not later than October 1, 1997, each 
        State shall establish an automated directory (to be known as 
        the `State Directory of New
         Hires') which shall contain information supplied in accordance 
with subsection (b) by employers on each newly hired employee.
            ``(2) Definitions.--As used in this section:
                    ``(A) Employee.--The term `employee'--
                            ``(i) means an individual who is an 
                        employee within the meaning of chapter 24 of 
                        the Internal Revenue Code of 1986; and
                            ``(ii) does not include an employee of a 
                        Federal or State agency performing intelligence 
                        or counterintelligence functions, if the head 
                        of such agency has determined that reporting 
                        pursuant to paragraph (1) with respect to the 
                        employee could endanger the safety of the 
                        employee or compromise an ongoing investigation 
                        or intelligence mission.
                    ``(B) Employer.--The term `employer' includes--
                            ``(i) any governmental entity, and
                            ``(ii) any labor organization.
                    ``(C) Labor organization.--The term `labor 
                organization' shall have the meaning given such term in 
                section 2(5) of the National Labor Relations Act, and 
                includes any entity (also known as a `hiring hall') 
                which is used by the organization and an employer to 
                carry out requirements described in section 8(f)(3) of 
                such Act of an agreement between the organization and 
                the employer.
    ``(b) Employer Information.--
            ``(1) Reporting requirement.--
                    ``(A) In general.--Except as provided in 
                subparagraphs (B) and (C), each employer shall furnish 
                to the Directory of New Hires of the State in which a 
                newly hired employee works, a report that contains the 
                name, address, and social security number of the 
                employee, and the name of, and identifying number 
                assigned under section 6109 of the Internal Revenue 
                Code of 1986 to, the employer.
                    ``(B) Multistate employers.--An employer that has 
                employees who are employed in 2 or more States and that 
                transmits reports magnetically or electronically may 
                comply with subparagraph (A) by designating 1 State in 
                which such employer has employees to which it will 
                transmit the report described in subparagraph (A), and 
                transmitting such report to such State. Any employer 
                that transmits reports pursuant to this subparagraph 
                shall notify the Secretary in writing as to which State 
                such employer designates for the purpose of sending 
                reports.
                    ``(C) Federal government employers.--Any 
                department, agency, or instrumentality of the United 
                States shall comply with subparagraph (A) by 
                transmitting the report described in subparagraph (A) 
                to the National Directory of New Hires established 
                pursuant to section 453.
            ``(2) Timing of report.--The report required by paragraph 
        (1) with respect to an employee shall be made not later than 
        the later of--
                    ``(A) 30 days after the date the employer hires the 
                employee; or
                    ``(B) in the case of an employer that reports by 
                magnetic or electronic means, the 1st business day of 
                the week following the date on which the employee 1st 
                receives wages or other compensation from the employer.
    ``(c) Reporting Format and Method.--Each report required by 
subsection (b) shall be made on a W-4 form and may be transmitted by 
1st class mail, magnetically, or electronically.
    ``(d) Civil Money Penalties on Noncomplying Employers.--An employer 
that fails to comply with subsection (b) with respect to an employee 
shall be subject to a State civil money penalty which shall be less 
than--
            ``(1) $25; or
            ``(2) $500 if, under State law, the failure is the result 
        of a conspiracy between the employer and the employee to not 
        supply the required report or to supply a false or incomplete 
        report.
    ``(e) Entry of Employer Information.--Information shall be entered 
into the data base maintained by the State Directory of New Hires 
within 5 business days of receipt from an employer pursuant to 
subsection (b).
    ``(f) Information Comparisons.--
            ``(1) In general.--Not later than October 1, 1998, an 
        agency designated by the State shall, directly or by contract, 
        conduct automated comparisons of the social security numbers 
        reported by employers pursuant to subsection (b) and the social 
        security numbers appearing in the records of the State case 
        registry for cases being enforced under the State plan.
            ``(2) Notice of match.--When an information comparison 
        conducted under paragraph (1) reveals a match with respect to 
        the social security number of an individual required to provide 
        support under a support order, the State Directory of New Hires 
        shall provide the agency administering the State plan approved 
        under this part of the appropriate State with the name, 
        address, and social security number of the employee to whom the 
        social security number is assigned, and the name of, and 
        identifying number assigned under section 6109 of the Internal 
        Revenue Code of 1986 to, the employer.
    ``(g) Transmission of Information.--
            ``(1) Transmission of wage withholding notices to 
        employers.--Within 2 business days after the date information 
        regarding a newly hired employee is entered into the State 
        Directory of New Hires, the State agency enforcing the 
        employee's child support obligation shall transmit a notice to 
        the employer of the employee directing the employer to withhold 
        from the wages of the employee an amount equal to the monthly 
        (or other periodic) child support obligation of the employee, 
        unless the employee's wages are not subject to withholding 
        pursuant to section 466(b)(3).
            ``(2) Transmissions to the national directory of new 
        hires.--
                    ``(A) New hire information.--Within 2 business days 
                after the date information regarding a newly hired 
                employee is entered into the State Directory of New 
                Hires, the State Directory of New Hires shall furnish 
                the information to the National Directory of New Hires.
                    ``(B) Wage and unemployment compensation 
                information.--The State Directory of New Hires shall, 
                on a quarterly basis, furnish to the National Directory 
                of New Hires extracts of the reports required under 
                section 303(a)(6) to be made to the Secretary of Labor 
                concerning the wages and unemployment compensation paid 
                to individuals, by such dates, in such format, and 
                containing such information as the Secretary of Health 
                and Human Services shall specify in regulations.
            ``(3) Business day defined.--As used in this subsection, 
        the term `business day' means a day on which State offices are 
        open for regular business.
    ``(h) Other Uses of New Hire Information.--
            ``(1) Location of child support obligors.--The agency 
        administering the State plan approved under this part shall use 
        information received pursuant to subsection (f)(2) to locate 
        individuals for purposes of establishing paternity and 
        establishing, modifying, and enforcing child support 
        obligations.
            ``(2) Verification of eligibility for certain programs.--A 
        State agency responsible for administering a program specified 
        in section 1137(b) shall have access to information reported by 
        employers pursuant to subsection (b) of this section for 
        purposes of verifying eligibility for the program.
            ``(3) Administration of employment security and workers' 
        compensation.--State agencies operating employment security and 
        workers' compensation programs shall have access to information 
        reported by employers pursuant to subsection (b) for the 
        purposes of administering such programs.''.
    (c) Quarterly Wage Reporting.--Section 1137(a)(3) (42 U.S.C. 1320b-
7(a)(3)) is amended--
            (1) by inserting ``(including State and local governmental 
        entities)'' after ``employers''; and
            (2) by inserting ``, and except that no report shall be 
        filed with respect to an employee of a State agency performing 
        intelligence or counterintelligence functions, if the head of 
        such agency has determined that filing such a report could 
        endanger the safety of the employee or compromise an ongoing 
        investigation or intelligence mission'' after ``paragraph 
        (2)''.
SEC. 914. AMENDMENTS CONCERNING INCOME WITHHOLDING.

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

SEC. 915. LOCATOR INFORMATION FROM INTERSTATE NETWORKS.

    Section 466(a) (42 U.S.C. 666(a)) is amended by adding at the end 
the following new paragraph:
            ``(12) Procedures to ensure that all Federal and State 
        agencies conducting activities under this part have access to 
        any system used by the State to locate an individual for 
        purposes relating to motor vehicles or law enforcement.''.
SEC. 916. EXPANSION OF THE FEDERAL PARENT LOCATOR SERVICE.

    (a) Expanded Authority To Locate Individuals and Assets.--Section 
453 (42 U.S.C. 653) is amended--
            (1) in subsection (a), by striking all that follows 
        ``subsection (c))'' and inserting ``, for the purpose of 
        establishing parentage, establishing, setting the amount of, 
        modifying, or enforcing child support obligations, or enforcing 
        child visitation orders--
            ``(1) information on, or facilitating the discovery of, the 
        location of any individual--
                    ``(A) who is under an obligation to pay child 
                support or provide child visitation rights;
                    ``(B) against whom such an obligation is sought;
                    ``(C) to whom such an obligation is owed,
        including the individual's social security number (or numbers), 
        most recent address, and the name, address, and employer 
        identification number of the individual's employer;
            ``(2) information on the individual's wages (or other 
        income) from, and benefits of, employment (including rights to 
        or enrollment in group health care coverage); and
            ``(3) information on the type, status, location, and amount 
        of any assets of, or debts owed by or to, any such 
        individual.''; and
            (2) in subsection (b), in the matter preceding paragraph 
        (1), by striking ``social security'' and all that follows 
        through ``absent parent'' and inserting ``information described 
        in subsection (a)''.
    (b) Authorized Person for Information Regarding Visitation 
Rights.--Section 453(c) (42 U.S.C. 653(c)) is amended--
            (1) in paragraph (1), by striking ``support'' and inserting 
        ``support or to seek to enforce orders providing child 
        visitation rights'';
            (2) in paragraph (2), by striking ``, or any agent of such 
        court; and'' and inserting ``or to issue an order against a 
        resident parent for visitation rights, or any agent of such 
        court;'';
            (3) by striking the period at the end of paragraph (3) and 
        inserting ``; and''; and
            (4) by adding at the end the following new paragraph:
            ``(4) the absent parent, only with regard to a court order 
        against a resident parent for child visitation rights.''.
    (c) Reimbursement for Information From Federal Agencies.--Section 
453(e)(2) (42 U.S.C. 653(e)(2)) is amended in the 4th sentence by 
inserting ``in an amount which the Secretary determines to be 
reasonable payment for the information exchange (which amount shall not 
include payment for the costs of obtaining, compiling, or maintaining 
the information)'' before the period.
    (d) Reimbursement for Reports by State Agencies.--Section 453 (42 
U.S.C. 653) is amended by adding at the end the following new 
subsection:
    ``(g) The Secretary may reimburse Federal and State agencies for 
the costs incurred by such entities in furnishing information requested 
by the Secretary under this section in an amount which the Secretary 
determines to be reasonable payment for the information exchange (which 
amount shall not include payment for the costs of obtaining, compiling, 
or maintaining the information).''.
    (e) Technical Amendments.--
            (1) Sections 452(a)(9), 453(a), 453(b), 463(a), 463(e), and 
        463(f) (42 U.S.C. 652(a)(9), 653(a), 653(b), 663(a), 663(e), 
        and 663(f)) are each amended by inserting ``Federal'' before 
        ``Parent'' each place such term appears.
            (2) Section 453 (42 U.S.C. 653) is amended in the heading 
        by adding ``federal'' before ``parent''.
    (f) New Components.--Section 453 (42 U.S.C. 653), as amended by 
subsection (d) of this section, is amended by adding at the end the 
following new subsection:
    ``(h)(1) Not later than October 1, 1998, in order to assist States 
in administering programs under State plans approved under this part 
and programs funded under part A, and for the other purposes specified 
in this section, the Secretary shall establish and maintain in the 
Federal Parent Locator Service an automated registry (which shall be 
known as the `Federal Case Registry of Child Support Orders'), which 
shall contain abstracts of support orders and other information 
described in paragraph (2) with respect to each case in each State case 
registry maintained pursuant to section 454A(e), as furnished (and 
regularly updated), pursuant to section 454A(f), by State agencies 
administering programs under this part.
    ``(2) The information referred to in paragraph (1) with respect to 
a case shall be such information as the Secretary may specify in 
regulations (including the names, social security numbers or other 
uniform identification numbers, and State case identification numbers) 
to identify the individuals who owe or are owed support (or with 
respect to or on behalf of whom support obligations are sought to be 
established), and the State or States which have the case.
    ``(i)(1) In order to assist States in administering programs under 
State plans approved under this part and programs funded under part A, 
and for the other purposes specified in this section, the Secretary 
shall, not later than October 1, 1996, establish and maintain in the 
Federal Parent Locator Service an automated directory to be known as 
the National Directory of New Hires, which shall contain the 
information supplied pursuant to section 453A(g)(2).
    ``(2) Information shall be entered into the data base maintained by 
the National Directory of New Hires within 2 business days of receipt 
pursuant to section 453A(g)(2).
    ``(3) The Secretary of the Treasury shall have access to the 
information in the National Directory of New Hires for purposes of 
administering section 32 of the Internal Revenue Code of 1986, or the 
advance payment of the earned income tax credit under section 3507 of 
such Code, and verifying a claim with respect to employment in a tax 
return.
    ``(4) The Secretary shall maintain within the National Directory of 
New Hires a list of multistate employers that report information 
regarding newly hired employees pursuant to section 453A(b)(1)(B), and 
the State which each such employer has designated to receive such 
information.
    ``(j)(1)(A) The Secretary shall transmit information on individuals 
and employers maintained under this section to the Social Security 
Administration to the extent necessary for verification in accordance 
with subparagraph (B).
    ``(B) The Social Security Administration shall verify the accuracy 
of, correct, or supply to the extent possible, and report to the 
Secretary, the following information supplied by the Secretary pursuant 
to subparagraph (A):
            ``(i) The name, social security number, and birth date of 
        each such individual.
            ``(ii) The employer identification number of each such 
        employer.
    ``(2) For the purpose of locating individuals in a paternity 
establishment case or a case involving the establishment, modification, 
or enforcement of a support order, the Secretary shall--
            ``(A) compare information in the National Directory of New 
        Hires against information in the support case abstracts in the 
        Federal Case Registry of Child Support Orders not less often 
        than every 2 business days; and
            ``(B) within 2 such days after such a comparison reveals a 
        match with respect to an individual, report the information to 
        the State agency responsible for the case.
    ``(3) To the extent and with the frequency that the Secretary 
determines to be effective in assisting States to carry out their 
responsibilities under programs operated under this part and programs 
funded under part A, the Secretary shall--
            ``(A) compare the information in each component of the 
        Federal Parent Locator Service maintained under this section 
        against the information in each other such component (other 
        than the comparison required by paragraph (2)), and report 
        instances in which such a comparison reveals a match with 
        respect to an individual to State agencies operating such 
        programs; and
            ``(B) disclose information in such registries to such State 
        agencies.
    ``(4) The National Directory of New Hires shall provide the 
Commissioner of Social Security with all information in the National 
Directory, which shall be used to determine the accuracy of payments 
under the supplemental security income program under title XVI and in 
connection with benefits under title II.
    ``(5) The Secretary may provide access to information reported by 
employers pursuant to section 453A(b) for research purposes found by 
the Secretary to be likely to contribute to achieving the purposes of 
part A or this part, but without personal identifiers.
    ``(k)(1) The Secretary shall reimburse the Commissioner of Social 
Security, at a rate negotiated between the Secretary and the 
Commissioner, for the costs incurred by the Commissioner in performing 
the verification services described in subsection (j).
    ``(2) The Secretary shall reimburse costs incurred by State 
directories of new hires in furnishing information as required by 
subsection (j)(3), at rates which the Secretary determines to be 
reasonable (which rates shall not include payment for the costs of 
obtaining, compiling, or maintaining such information).
    ``(3) A State or Federal agency that receives information from the 
Secretary pursuant to this section shall reimburse the Secretary for 
costs incurred by the Secretary in furnishing the information, at rates 
which the Secretary determines to be reasonable (which rates shall 
include payment for the costs of obtaining, verifying, maintaining, and 
comparing the information).
    ``(l) Information in the Federal Parent Locator Service, and 
information resulting from comparisons using such information, shall 
not be used or disclosed except as expressly provided in this section, 
subject to section 6103 of the Internal Revenue Code of 1986.
    ``(m) The Secretary shall establish and implement safeguards with 
respect to the entities established under this section designed to--
            ``(1) ensure the accuracy and completeness of information 
        in the Federal Parent Locator Service; and
            ``(2) restrict access to confidential information in the 
        Federal Parent Locator Service to authorized persons, and 
        restrict use of such information to authorized purposes.
    ``(n) Each department, agency, and instrumentality of the United 
States shall on a quarterly basis report to the Federal Parent Locator 
Service the name and social security number of each employee and the 
wages paid to the employee during the previous quarter, except that no 
report shall be filed with respect to an employee of a department, 
agency, or instrumentality performing intelligence or 
counterintelligence functions, if the head of such department, agency, 
or instrumentality has determined that filing such a report could 
endanger the safety of the employee or compromise an ongoing 
investigation or intelligence mission.''.
    (f) Conforming Amendments.--
            (1) To part d of title iv of the social security act.--
        Section 454(8)(B) (42 U.S.C. 654(8)(B)) is amended to read as 
        follows:
                    ``(B) the Federal Parent Locator Service 
                established under section 453;''.
            (2) To federal unemployment tax act.--Section 3304(a)(16) 
        of the Internal Revenue Code of 1986 is amended--
                    (A) by striking ``Secretary of Health, Education, 
                and Welfare'' each place such term appears and 
                inserting ``Secretary of Health and Human Services'';
                    (B) in subparagraph (B), by striking ``such 
                information'' and all that follows and inserting 
                ``information furnished under subparagraph (A) or (B) 
                is used only for the purposes authorized under such 
                subparagraph;'';
                    (C) by striking ``and'' at the end of subparagraph 
                (A);
                    (D) by redesignating subparagraph (B) as 
                subparagraph (C); and
                    (E) by inserting after subparagraph (A) the 
                following new subparagraph:
                    ``(B) wage and unemployment compensation 
                information contained in the records of such agency 
                shall be furnished to the Secretary of Health and Human 
                Services (in accordance with regulations promulgated by 
                such Secretary) as necessary for the purposes of the 
                National Directory of New Hires established under 
                section 453(i) of the Social Security Act, and''.
            (3) To state grant program under title iii of the social 
        security act.--Subsection (h) of section 303 (42 U.S.C. 503) is 
        amended to read as follows:
    ``(h)(1) The State agency charged with the administration of the 
State law shall, on a reimbursable basis--
            ``(A) disclose quarterly, to the Secretary of Health and 
        Human Services wage and claim information, as required pursuant 
        to section 453(i)(1), contained in the records of such agency;
            ``(B) ensure that information provided pursuant to 
        subparagraph (A) meets such standards relating to correctness 
        and verification as the Secretary of Health and Human Services, 
        with the concurrence of the Secretary of Labor, may find 
        necessary; and
            ``(C) establish such safeguards as the Secretary of Labor 
        determines are necessary to insure that information disclosed 
        under subparagraph (A) is used only for purposes of section 
        453(i)(1) in carrying out the child support enforcement program 
        under title IV.
    ``(2) Whenever the Secretary of Labor, after reasonable notice and 
opportunity for hearing to the State agency charged with the 
administration of the State law, finds that there is a failure to 
comply substantially with the requirements of paragraph (1), the 
Secretary of Labor shall notify such State agency that further payments 
will not be made to the State until the Secretary of Labor is satisfied 
that there is no longer any such failure. Until the Secretary of Labor 
is so satisfied, the Secretary shall make no future certification to 
the Secretary of the Treasury with respect to the State.
    ``(3) For purposes of this subsection--
            ``(A) the term `wage information' means information 
        regarding wages paid to an individual, the social security 
        account number of such individual, and the name, address, 
        State, and the Federal employer identification number of the 
        employer paying such wages to such individual; and
            ``(B) the term `claim information' means information 
        regarding whether an individual is receiving, has received, or 
        has made application for, unemployment compensation, the amount 
        of any such compensation being received (or to be received by 
        such individual), and the individual's current (or most recent) 
        home address.''.

SEC. 917. COLLECTION AND USE OF SOCIAL SECURITY NUMBERS FOR USE IN 
              CHILD SUPPORT ENFORCEMENT.

    (a) State Law Requirement.--Section 466(a) (42 U.S.C. 666(a)), as 
amended by section 915, is amended by adding at the end the following 
new paragraph:
            ``(13) Procedures requiring that the social security number 
        of--
                    ``(A) any applicant for a professional license, 
                commercial driver's license, occupational license, or 
                marriage license be recorded on the application;
                    ``(B) any individual who is subject to a divorce 
                decree, support order, or paternity determination or 
                acknowledgment be placed in the records relating to the 
                matter; and
                    ``(C) any individual who has died be placed in the 
                records relating to the death and be recorded on the 
                death certificate.''.
    (b) Conforming Amendments.--Section 205(c)(2)(C) (42 U.S.C. 
405(c)(2)(C)), as amended by section 321(a)(9) of the Social Security 
Independence and Program Improvements Act of 1994, is amended--
            (1) in clause (i), by striking ``may require'' and 
        inserting ``shall require'';
            (2) in clause (ii), by inserting after the 1st sentence the 
        following: ``In the administration of any law involving the 
        issuance of a marriage certificate or license, each State shall 
        require each party named in the certificate or license to 
        furnish to the State (or political subdivision thereof), or any 
        State agency having administrative responsibility for the law 
        involved, the social security number of the party.'';
            (3) in clause (vi), by striking ``may'' and inserting 
        ``shall''; and
            (4) by adding at the end the following new clauses:
                            ``(x) An agency of a State (or a political 
                        subdivision thereof) charged with the 
                        administration of any law concerning the 
                        issuance or renewal of a license, certificate, 
                        permit, or other authorization to engage in a 
                        profession, an occupation, or a commercial 
                        activity shall require all applicants for 
                        issuance or renewal of the license, 
                        certificate, permit, or other authorization to 
                        provide the applicant's social security number 
                        to the agency for the purpose of administering 
                        such laws, and for the purpose of responding to 
                        requests for information from an agency 
                        operating pursuant to part D of title IV.
                            ``(xi) All divorce decrees, support orders, 
                        and paternity determinations issued, and all 
                        paternity acknowledgments made, in each State 
                        shall include the social security number of 
                        each party to the decree, order, determination, 
                        or acknowledgement in the records relating to 
                        the matter.''.

         Subtitle C--Streamlining and Uniformity of Procedures

SEC. 921. ADOPTION OF UNIFORM STATE LAWS.

    Section 466 (42 U.S.C. 666) is amended by adding at the end the 
following new subsection:
    ``(f)(1) In order to satisfy section 454(20)(A) on or after January 
1, 1997, each State must have in effect the Uniform Interstate Family 
Support Act, as approved by the National Conference of Commissioners on 
Uniform State Laws in August 1992 (with the modifications and additions 
specified in this subsection), and the procedures required to implement 
such Act.
    ``(2) The State law enacted pursuant to paragraph (1) may be 
applied to any case involving an order which is established or modified 
in a State and which is sought to be modified or enforced in another 
State.
    ``(3) The State law enacted pursuant to paragraph (1) of this 
subsection shall contain the following provision in lieu of section 
611(a)(1) of the Uniform Interstate Family Support Act:
            ```(1) the following requirements are met:
                    ```(i) the child, the individual obligee, and the 
                obligor--
                            ```(I) do not reside in the issuing State; 
                        and
                            ```(II) either reside in this State or are 
                        subject to the jurisdiction of this State 
                        pursuant to section 201; and
                    ```(ii) in any case where another State is 
                exercising or seeks to exercise jurisdiction to modify 
                the order, the conditions of section 204 are met to the 
                same extent as required for proceedings to establish 
                orders; or'.
    ``(4) The State law enacted pursuant to paragraph (1) shall provide 
that, in any proceeding subject to the law, process may be served (and 
proved) upon persons in the State by any means acceptable in any State 
which is the initiating or responding State in the proceeding.''.

SEC. 922. IMPROVEMENTS TO FULL FAITH AND CREDIT FOR CHILD SUPPORT 
              ORDERS.

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

SEC. 923. ADMINISTRATIVE ENFORCEMENT IN INTERSTATE CASES.

    Section 466(a) (42 U.S.C. 666(a)), as amended by sections 915 and 
917(a), is amended by adding at the end the following new paragraph:
            ``(14) Procedures under which--
                    ``(A)(i) the State shall respond within 5 business 
                days to a request made by another State to enforce a 
                support order; and
                    ``(ii) the term `business day' means a day on which 
                State offices are open for regular business;
                    ``(B) the State may, by electronic or other means, 
                transmit to another State a request for assistance in a 
                case involving the enforcement of a support order, 
                which request--
                            ``(i) shall include such information as 
                        will enable the State to which the request is 
                        transmitted to compare the information about 
                        the case to the information in the data bases 
                        of the State; and
                            ``(ii) shall constitute a certification by 
                        the requesting State--
                                    ``(I) of the amount of support 
                                under the order the payment of which is 
                                in arrears; and
                                    ``(II) that the requesting State 
                                has complied with all procedural due 
                                process requirements applicable to the 
                                case;
                    ``(C) if the State provides assistance to another 
                State pursuant to this paragraph with respect to a 
                case, neither State shall consider the case to be 
                transferred to the caseload of such other State; and
                    ``(D) the State shall maintain records of--
                            ``(i) the number of such requests for 
                        assistance received by the State;
                            ``(ii) the number of cases for which the 
                        State collected support in response to such a 
                        request; and
                            ``(iii) the amount of such collected 
                        support.''.

SEC. 924. USE OF FORMS IN INTERSTATE ENFORCEMENT.

    (a) Promulgation.--Section 452(a) (42 U.S.C. 652(a)) is amended--
            (1) by striking ``and'' at the end of paragraph (9);
            (2) by striking the period at the end of paragraph (10) and 
        inserting ``; and''; and
            (3) by adding at the end the following new paragraph:
            ``(11) not later than 60 days after the date of the 
        enactment of the Work Opportunity Act of 1995, establish an 
        advisory committee, which shall include State directors of 
        programs under this part, and not later than June 30, 1996, 
        after consultation with the advisory committee, promulgate 
        forms to be used by States in interstate cases for--
                    ``(A) collection of child support through income 
                withholding;
                    ``(B) imposition of liens; and
                    ``(C) administrative subpoenas.''.
    (b) Use by States.--Section 454(9) (42 U.S.C. 654(9)) is amended--
            (1) by striking ``and'' at the end of subparagraph (C);
            (2) by inserting ``and'' at the end of subparagraph (D); 
        and
            (3) by adding at the end the following new subparagraph:
                    ``(E) no later than October 1, 1996, in using the 
                forms promulgated pursuant to section 452(a)(11) for 
                income withholding, imposition of liens, and issuance 
                of administrative subpoenas in interstate child support 
                cases;''.

SEC. 925. STATE LAWS PROVIDING EXPEDITED PROCEDURES.

    (a) State Law Requirements.--Section 466 (42 U.S.C. 666), as 
amended by section 914, is amended--
            (1) in subsection (a)(2), by striking the 1st sentence and 
        inserting the following: ``Expedited administrative and 
        judicial procedures (including the procedures specified in 
        subsection (c)) for establishing paternity and for 
        establishing, modifying, and enforcing support obligations.''; 
        and
            (2) by inserting after subsection (b) the following new 
        subsection:
    ``(c) The procedures specified in this subsection are the 
following:
            ``(1) Procedures which give the State agency the authority 
        to take the following actions relating to establishment or 
        enforcement of support orders, without the necessity of 
        obtaining an order from any other judicial or administrative 
        tribunal, and to recognize and enforce the authority of State 
        agencies of other States) to take the following actions:
                    ``(A) To order genetic testing for the purpose of 
                paternity establishment as provided in section 
                466(a)(5).
                    ``(B) To subpoena any financial or other 
                information needed to establish, modify, or enforce a 
                support order, and to impose penalties for failure to 
                respond to such a subpoena.
                    ``(C) To require all entities in the State 
                (including for-profit, nonprofit, and governmental 
                employers) to provide promptly, in response to a 
                request by the State agency of that or any other State 
                administering a program under this part, information on 
                the employment, compensation, and benefits of any 
                individual employed by such entity as an employee or 
                contractor, and to sanction failure to respond to any 
                such request.
                    ``(D) To obtain access, subject to safeguards on 
                privacy and information security, to the following 
                records (including automated access, in the case of 
                records maintained in automated data bases):
                            ``(i) Records of other State and local 
                        government agencies, including--
                                    ``(I) vital statistics (including 
                                records of marriage, birth, and 
                                divorce);
                                    ``(II) State and local tax and 
                                revenue records (including information 
                                on residence address, employer, income 
                                and assets);
                                    ``(III) records concerning real and 
                                titled personal property;
                                    ``(IV) records of occupational and 
                                professional licenses, and records 
                                concerning the ownership and control of 
                                corporations, partnerships, and other 
                                business entities;
                                    ``(V) employment security records;
                                    ``(VI) records of agencies 
                                administering public assistance 
                                programs;
                                    ``(VII) records of the motor 
                                vehicle department; and
                                    ``(VIII) corrections records.
                            ``(ii) Certain records held by private 
                        entities, including--
                                    ``(I) customer records of public 
                                utilities and cable television 
                                companies; and
                                    ``(II) information (including 
                                information on assets and liabilities) 
                                on individuals who owe or are owed 
                                support (or against or with respect to 
                                whom a support obligation is sought) 
                                held by financial institutions (subject 
                                to limitations on liability of such 
                                entities arising from affording such 
                                access).
                    ``(E) In cases where support is subject to an 
                assignment in order to comply with a requirement 
                imposed pursuant to part A or section 1912, or to a 
                requirement to pay through the State disbursement unit 
                established pursuant to section 454B, upon providing 
                notice to obligor and obligee, to direct the obligor or 
                other payor to change the payee to the appropriate 
                government entity.
                    ``(F) To order income withholding in accordance 
                with subsections (a)(1) and (b) of section 466.
                    ``(G) In cases in which there is a support 
                arrearage, to secure assets to satisfy the arrearage 
                by--
                            ``(i) intercepting or seizing periodic or 
                        lump-sum payments from--
                                    ``(I) a State or local agency, 
                                including unemployment compensation, 
                                workers' compensation, and other 
                                benefits; and
                                    ``(II) judgments, settlements, and 
                                lotteries;
                            ``(ii) attaching and seizing assets of the 
                        obligor held in financial institutions;
                            ``(iii) attaching public and private 
                        retirement funds; and
                            ``(iv) imposing liens in accordance with 
                        subsection (a)(4) and, in appropriate cases, to 
                        force sale of property and distribution of 
                        proceeds.
                    ``(H) For the purpose of securing overdue support, 
                to increase the amount of monthly support payments to 
                include amounts for arrearages, subject to such 
                conditions or limitations as the State may provide.
        Such procedures shall be subject to due process safeguards, 
        including (as appropriate) requirements for notice, opportunity 
        to contest the action, and opportunity for an appeal on the 
        record to an independent administrative or judicial tribunal.
            ``(2) The expedited procedures required under subsection 
        (a)(2) shall include the following rules and authority, 
        applicable with respect to all proceedings to establish 
        paternity or to establish, modify, or enforce support orders:
                    ``(A) Procedures under which--
                            ``(i) each party to any paternity or child 
                        support proceeding is required (subject to 
                        privacy safeguards) to file with the tribunal 
                        and the State case registry upon entry of an 
                        order, and to update as appropriate, 
                        information on location and identity of the 
                        party, including social security number, 
                        residential and mailing addresses, telephone 
                        number, driver's license number, and name, 
                        address, and name and telephone number of 
                        employer; and
                            ``(ii) in any subsequent child support 
                        enforcement action between the parties, upon 
                        sufficient showing that diligent effort has 
                        been made to ascertain the location of such a 
                        party, the tribunal may deem State due process 
                        requirements for notice and service of process 
                        to be met with respect to the party, upon 
                        delivery of written notice to the most recent 
                        residential or employer address filed with the 
                        tribunal pursuant to clause (i).
                    ``(B) Procedures under which--
                            ``(i) the State agency and any 
                        administrative or judicial tribunal with 
                        authority to hear child support and paternity 
                        cases exerts statewide jurisdiction over the 
                        parties; and
                            ``(ii) in a State in which orders are 
                        issued by courts or administrative tribunals, a 
                        case may be transferred between local 
                        jurisdictions in the State without need for any 
                        additional filing by the petitioner, or service 
                        of process upon the respondent, to retain 
                        jurisdiction over the parties.''.
    (b) Automation of State Agency Functions.--Section 454A, as added 
by section 944(a)(2) and as amended by sections 911 and 912(c), is 
amended by adding at the end the following new subsection:
    ``(h) Expedited Administrative Procedures.--The automated system 
required by this section shall be used, to the maximum extent feasible, 
to implement the expedited administrative procedures required by 
section 466(c).''.

                  Subtitle D--Paternity Establishment

SEC. 931. STATE LAWS CONCERNING PATERNITY ESTABLISHMENT.

    (a) State Laws Required.--Section 466(a)(5) (42 U.S.C. 666(a)(5)) 
is amended to read as follows:
            ``(5)(A)(i) Procedures which permit the establishment of 
        the paternity of a child at any time before the child attains 
        21 years of age.
            ``(ii) As of August 16, 1984, clause (i) shall also apply 
        to a child for whom paternity has not been established or for 
        whom a paternity action was brought but dismissed because a 
        statute of limitations of less than 21 years was then in effect 
        in the State.
            ``(B)(i) Procedures under which the State is required, in a 
        contested paternity case, unless otherwise barred by State law, 
        to require the child and all other parties (other than 
        individuals found under section 454(29) to have good cause for 
        refusing to cooperate) to submit to genetic tests upon the 
        request of any such party if the request is supported by a 
        sworn statement by the party--
                    ``(I) alleging paternity, and setting forth facts 
                establishing a reasonable possibility of the requisite 
                sexual contact between the parties; or
                    ``(II) denying paternity, and setting forth facts 
                establishing a reasonable possibility of the 
                nonexistence of sexual contact between the parties.
            ``(ii) Procedures which require the State agency in any 
        case in which the agency orders genetic testing--
                    ``(I) to pay costs of such tests, subject to 
                recoupment (where the State so elects) from the alleged 
                father if paternity is established; and
                    ``(II) to obtain additional testing in any case 
                where an original test result is contested, upon 
                request and advance payment by the contestant.
            ``(C)(i) Procedures for a simple civil process for 
        voluntarily acknowledging paternity under which the State must 
        provide that, before a mother and a putative father can sign an 
        acknowledgment of paternity, the mother and the putative father 
        must be given notice, orally and in writing, of the 
        alternatives to, the legal consequences of, and the rights 
        (including, if 1 parent is a minor, any rights afforded due to 
        minority status) and responsibilities that arise from, signing 
        the acknowledgment.
            ``(ii) Such procedures must include a hospital-based 
        program for the voluntary acknowledgment of paternity focusing 
        on the period immediately before or after the birth of a child.
            ``(iii)(I) Such procedures must require the State agency 
        responsible for maintaining birth records to offer voluntary 
        paternity establishment services.
            ``(II)(aa) The Secretary shall prescribe regulations 
        governing voluntary paternity establishment services offered by 
        hospitals and birth record agencies.
            ``(bb) The Secretary shall prescribe regulations specifying 
        the types of other entities that may offer voluntary paternity 
        establishment services, and governing the provision of such 
        services, which shall include a requirement that such an entity 
        must use the same notice provisions used by, use the same 
        materials used by, provide the personnel providing such 
        services with the same training provided by, and evaluate the 
        provision of such services in the same manner as the provision 
        of such services is evaluated by, voluntary paternity 
        establishment programs of hospitals and birth record agencies.
            ``(iv) Such procedures must require the State to develop 
        and use an affidavit for the voluntary acknowledgment of 
        paternity which includes the minimum requirements of the 
        affidavit developed by the Secretary under section 452(a)(7) 
        for the voluntary acknowledgment of paternity, and to give full 
        faith and credit to such an affidavit signed in any other State 
        according to its procedures.
            ``(D)(i) Procedures under which the name of the father 
        shall be included on the record of birth of the child only if 
        the father and mother have signed an acknowledgment of 
        paternity and under which a signed acknowledgment of paternity 
        is considered a legal finding of paternity, subject to the 
        right of any signatory to rescind the acknowledgment within 60 
        days.
            ``(ii) Procedures under which, after the 60-day period 
        referred to in clause (i), a signed acknowledgment of paternity 
        may be challenged in court only on the basis of fraud, duress, 
        or material mistake of fact, with the burden of proof upon the 
        challenger, and under which the legal responsibilities 
        (including
         child support obligations) of any signatory arising from the 
acknowledgment may not be suspended during the challenge, except for 
good cause shown.
            ``(E) Procedures under which judicial or administrative 
        proceedings are not required or permitted to ratify an 
        unchallenged acknowledgment of paternity.
            ``(F) Procedures--
                    ``(i) requiring the admission into evidence, for 
                purposes of establishing paternity, of the results of 
                any genetic test that is--
                            ``(I) of a type generally acknowledged as 
                        reliable by accreditation bodies designated by 
                        the Secretary; and
                            ``(II) performed by a laboratory approved 
                        by such an accreditation body;
                    ``(ii) requiring an objection to genetic testing 
                results to be made in writing not later than a 
                specified number of days before any hearing at which 
                the results may be introduced into evidence (or, at 
                State option, not later than a specified number of days 
                after receipt of the results); and
                    ``(iii) making the test results admissible as 
                evidence of paternity without the need for foundation 
                testimony or other proof of authenticity or accuracy, 
                unless objection is made.
            ``(G) Procedures which create a rebuttable or, at the 
        option of the State, conclusive presumption of paternity upon 
        genetic testing results indicating a threshold probability that 
        the alleged father is the father of the child.
            ``(H) Procedures requiring a default order to be entered in 
        a paternity case upon a showing of service of process on the 
        defendant and any additional showing required by State law.
            ``(I) Procedures providing that the parties to an action to 
        establish paternity are not entitled to a trial by jury.
            ``(J) Procedures which require that a temporary order be 
        issued, upon motion by a party, requiring the provision of 
        child support pending an administrative or judicial 
        determination of parentage, where there is clear and convincing 
        evidence of paternity (on the basis of genetic tests or other 
        evidence).
            ``(K) Procedures under which bills for pregnancy, 
        childbirth, and genetic testing are admissible as evidence 
        without requiring third-party foundation testimony, and shall 
        constitute prima facie evidence of amounts incurred for such 
        services or for testing on behalf of the child.
            ``(L) Procedures ensuring that the putative father has a 
        reasonable opportunity to initiate a paternity action.
            ``(M) Procedures under which voluntary acknowledgments and 
        adjudications of paternity by judicial or administrative 
        processes are filed with the State registry of birth records 
        for comparison with information in the State case registry.''.
    (b) National Paternity Acknowledgment Affidavit.--Section 452(a)(7) 
(42 U.S.C. 652(a)(7)) is amended by inserting ``, and develop an 
affidavit to be used for the voluntary acknowledgment of paternity 
which shall include the social security number of each parent'' before 
the semicolon.
    (c) Technical Amendment.--Section 468 (42 U.S.C. 668) is amended by 
striking ``a simple civil process for voluntarily acknowledging 
paternity and''.

SEC. 932. OUTREACH FOR VOLUNTARY PATERNITY ESTABLISHMENT.

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

SEC. 933. COOPERATION BY APPLICANTS FOR AND RECIPIENTS OF TEMPORARY 
              FAMILY ASSISTANCE.

    Section 454 (42 U.S.C. 654), as amended by sections 901(b), 904(a), 
912(a), and 913(a), is amended--
            (1) by striking ``and'' at the end of paragraph (27);
            (2) by striking the period at the end of paragraph (28) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (28) the following new 
        paragraph:
            ``(29) provide that the State agency responsible for 
        administering the State plan--
                    ``(A) shall make the determination (and 
                redetermination at appropriate intervals) as to whether 
                an individual who has applied for or is receiving 
                assistance under the State program funded under part A 
                or the State program under title XIX is cooperating in 
                good faith with the State in establishing the paternity 
                of, or in establishing, modifying, or enforcing a 
                support order for, any child of the individual by 
                providing the State agency with the name of, and such 
                other information as the State agency may require with 
                respect to, the noncustodial parent of the child, 
                subject to such good cause and other exceptions as the 
                State shall establish and taking into account the best 
                interests of the child;
                    ``(B) shall require the individual to supply 
                additional necessary information and appear at 
                interviews, hearings, and legal proceedings;
                    ``(C) shall require the individual and the child to 
                submit to genetic tests pursuant to judicial or 
                administrative order; and
                    ``(D) shall promptly notify the individual and the 
                State agency administering the State program funded 
                under part A and the State agency administering the 
                State program under title XIX of each such 
                determination, and if noncooperation is determined, the 
                basis therefore.''.

             Subtitle E--Program Administration and Funding

SEC. 941. PERFORMANCE-BASED INCENTIVES AND PENALTIES.

    (a) Incentive Payments.--
            (1) In general.--Section 458 (42 U.S.C. 658) is amended--
                    (A) in subsection (a), by striking ``aid to 
                families'' and all through the end period, and 
                inserting ``assistance under a program funded under 
                part A, and regardless of the economic circumstances of 
                their parents, the Secretary shall, from the support 
                collected which would otherwise represent the 
                reimbursement to the Federal government under section 
                457, pay to each State for each fiscal year, on a 
                quarterly basis (as described in subsection (e)) 
                beginning with the quarter commencing October 1, 1999, 
                an incentive payment in an amount determined under 
                subsections (b) and (c).'';
                    (B) by striking subsections (b) and (c) and 
                inserting the following:
    ``(b)(1) Not later than 60 days after the date of the enactment of 
the Work Opportunity Act of 1995, the Secretary shall establish a 
committee which shall include State directors of programs under this 
part and which shall develop for the Secretary's approval a formula for 
the distribution of incentive payments to the States.
    ``(2) The formula developed and approved under paragraph (1)--
            ``(A) shall result in a percentage of the collections 
        described in subsection (a) being distributed to each State 
        based on the State's comparative performance in the following 
        areas and any other areas approved by the Secretary under this 
        subsection:
                    ``(i) The IV-D paternity establishment percentage, 
                as defined in section 452(g)(2).
                    ``(ii) The percentage of cases with a support order 
                with respect to which services are being provided under 
                the State plan approved under this part.
                    ``(iii) The percentage of cases with a support 
                order in which child support is paid with respect to 
                which services are being so provided.
                    ``(iv) In cases receiving services under the State 
                plan approved under this part, the amount of child 
                support collected compared to the amount of outstanding 
                child support owed.
                    ``(v) The cost-effectiveness of the State program;
            ``(B) shall take into consideration--
                    ``(i) the impact that incentives can have on 
                reducing the need to provide public assistance and on 
                permanently removing families from public assistance;
                    ``(ii) the need to balance accuracy and fairness 
                with simplicity of understanding and data gathering;
                    ``(iii) the need to reward performance which 
                improves short- and long-term program outcomes, 
                especially establishing paternity and support orders 
                and encouraging the timely payment of support;
                    ``(iv) the Statewide paternity establishment 
                percentage;
                    ``(v) baseline data on current performance and 
                projected costs of performance increases to assure that 
                top performing States can actually achieve the top 
                incentive levels with a reasonable resource investment;
                    ``(vi) performance outcomes which would warrant an 
                increase in the total incentive payments made to the 
                States; and
                    ``(vii) the use or distribution of any portion of 
                the total incentive payments in excess of the total of 
                the payments which may be distributed under subsection 
                (c);
            ``(C) shall be determined so as to distribute to the States 
        total incentive payments equal to the total incentive payments 
        for all States in fiscal year 1994, plus a portion of any 
        increase in the reimbursement to the Federal Government under 
        section 457 for fiscal year 1999 or any other increase based on 
        other performance outcomes approved by the Secretary under this 
        subsection;
            ``(D) shall use a definition of the term `State' which does 
        not include any area within the jurisdiction of an Indian 
        tribal government; and
            ``(E) shall use a definition of the term `Statewide 
        paternity establishment percentage' to mean with respect to a 
        State and a fiscal year--
                    ``(i) the total number of children in the State who 
                were born out of wedlock, who have not attained 1 year 
                of age and for whom paternity is established or 
                acknowledged during the fiscal year; divided by
                    ``(ii) the total number of children born out of 
                wedlock in the State during the fiscal year.
    ``(c) The total amount of the incentives payment made by the 
Secretary to a State in a fiscal year shall not exceed 90 percent of 
the total amounts expended by such State during such year for the 
operation of the plan approved under section 454, less payments to the 
State pursuant to section 455 for such year.'';
            (2) in subsection (d), by striking ``, and any amounts'' 
        through ``shall be excluded''.
    (b) Payments to Political Subdivisions.--Section 454(22) (42 U.S.C. 
654(22)) is amended by inserting before the semicolon the following: 
``, but a political subdivision shall not be entitled to receive, and 
the State may retain, any amount in excess of the amount the political 
subdivision expends on the State program under this part, less the 
amount equal to the percentage of that expenditure paid by the 
Secretary under section 455''.
    (c) Calculation of IV-D Paternity Establishment Percentage.--
            (1) Section 452(g)(1) (42 U.S.C. 652(g)(1)) is amended--
                    (A) in the matter preceding subparagraph (A) by 
                inserting ``its overall performance in child support 
                enforcement is satisfactory (as defined in section 
                458(b) and regulations of the Secretary), and'' after 
                ``1994,''; and
                    (B) in each of subparagraphs (A) and (B), by 
                striking ``75'' and inserting ``90''.
            (2) Section 452(g)(2)(A) (42 U.S.C. 652(g)(2)(A)) is 
        amended in the matter preceding clause (i)--
                    (A) by striking ``paternity establishment 
                percentage'' and inserting ``IV-D paternity 
                establishment percentage''; and
                    (B) by striking ``(or all States, as the case may 
                be)''.
            (3) Section 452(g)(3) (42 U.S.C. 652(g)(3)) is amended--
                    (A) by striking subparagraph (A) and redesignating 
                subparagraphs (B) and (C) as subparagraphs (A) and (B), 
                respectively;
                    (B) in subparagraph (A) (as so redesignated), by 
                striking ``the percentage of children born out-of-
                wedlock in a State'' and inserting ``the percentage of 
                children in a State who are born out of wedlock or for 
                whom support has not been established''; and
                    (C) in subparagraph (B) (as so redesignated)--
                            (i) by inserting ``and overall performance 
                        in child support enforcement'' after 
                        ``paternity establishment percentages''; and
                            (ii) by inserting ``and securing support'' 
                        before the period.
    (d) Effective Dates.--
            (1) Incentive adjustments.--
                    (A) In general.--The amendments made by subsections 
                (a) and (b) shall become effective on the date of the 
                enactment of this Act, except to the extent provided in 
                subparagraph (B).
                    (B) Exception.--Section 458 of the Social Security 
                Act, as in effect before the date of the enactment of 
                this section, shall be effective for purposes of 
                incentive payments to States for fiscal years before 
                fiscal year 2000.
            (2) Penalty reductions.--The amendments made by subsection 
        (c) shall become effective with respect to calendar quarters 
        beginning on and after the date of the enactment of this Act.

SEC. 942. FEDERAL AND STATE REVIEWS AND AUDITS.

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

SEC. 943. REQUIRED REPORTING PROCEDURES.

    (a) Establishment.--Section 452(a)(5) (42 U.S.C. 652(a)(5)) is 
amended by inserting ``, and establish procedures to be followed by 
States for collecting and reporting information required to be provided 
under this part, and establish uniform definitions (including those 
necessary to enable the measurement of State compliance with the 
requirements of this part relating to expedited processes) to be 
applied in following such procedures'' before the semicolon.
    (b) State Plan Requirement.--Section 454 (42 U.S.C. 654), as 
amended by sections 901(b), 904(a), 912(a), 913(a), and 933, is 
amended--
            (1) by striking ``and'' at the end of paragraph (28);
            (2) by striking the period at the end of paragraph (29) and 
        inserting ``; and''; and
            (3) by adding after paragraph (29) the following new 
        paragraph:
            ``(30) provide that the State shall use the definitions 
        established under section 452(a)(5) in collecting and reporting 
        information as required under this part.''.

SEC. 944. AUTOMATED DATA PROCESSING REQUIREMENTS.

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

    ``(a) In General.--In order for a State to meet the requirements of 
this section, the State agency administering the State program under 
this part shall have in operation a single statewide automated data 
processing and information retrieval system which has the capability to 
perform the tasks specified in this section with the frequency and in 
the manner required by or under this part.
    ``(b) Program Management.--The automated system required by this 
section shall perform such functions as the Secretary may specify 
relating to management of the State program under this part, 
including--
            ``(1) controlling and accounting for use of Federal, State, 
        and local funds in carrying out the program; and
            ``(2) maintaining the data necessary to meet Federal 
        reporting requirements under this part on a timely basis.
    ``(c) Calculation of Performance Indicators.--In order to enable 
the Secretary to determine the incentive and penalty adjustments 
required by sections 452(g) and 458, the State agency shall--
            ``(1) use the automated system--
                    ``(A) to maintain the requisite data on State 
                performance with respect to paternity establishment and 
                child support enforcement in the State; and
                    ``(B) to calculate the IV-D paternity establishment 
                percentage and overall performance in child support 
                enforcement for the State for each fiscal year; and
            ``(2) have in place systems controls to ensure the 
        completeness and reliability of, and ready access to, the data 
        described in paragraph (1)(A), and the accuracy of the 
        calculations described in paragraph (1)(B).
    ``(d) Information Integrity and Security.--The State agency shall 
have in effect safeguards on the integrity, accuracy, and completeness 
of, access to, and use of data in the automated system required by this 
section, which shall include the following (in addition to such other 
safeguards as the Secretary may specify in regulations):
            ``(1) Policies restricting access.--Written policies 
        concerning access to data by State agency personnel, and 
        sharing of data with other persons, which--
                    ``(A) permit access to and use of data only to the 
                extent necessary to carry out the State program under 
                this part; and
                    ``(B) specify the data which may be used for 
                particular program purposes, and the personnel 
                permitted access to such data.
            ``(2) Systems controls.--Systems controls (such as 
        passwords or blocking of fields) to ensure strict adherence to 
        the policies described in paragraph (1).
            ``(3) Monitoring of access.--Routine monitoring of access 
        to and use of the automated system, through methods such as 
        audit trails and feedback mechanisms, to guard against and 
        promptly identify unauthorized access or use.
            ``(4) Training and information.--Procedures to ensure that 
        all personnel (including State and local agency staff and 
        contractors) who may have access to or be required to use 
        confidential program data are informed of applicable 
        requirements and penalties (including those in section 6103 of 
        the Internal Revenue Code of 1986), and are adequately trained 
        in security procedures.
            ``(5) Penalties.--Administrative penalties (up to and 
        including dismissal from employment) for unauthorized access 
        to, or disclosure or use of, confidential data.''.
            (3) Regulations.--The Secretary of Health and Human 
        Services shall prescribe final regulations for implementation 
        of section 454A of the Social Security Act not later than 2 
        years after the date of the enactment of this Act.
            (4) Implementation timetable.--Section 454(24) (42 U.S.C. 
        654(24)), as amended by sections 904(a)(2) and 912(a)(1), is 
        amended to read as follows:
            ``(24) provide that the State will have in effect an 
        automated data processing and information retrieval system--
                    ``(A) by October 1, 1997, which meets all 
                requirements of this part which were enacted on or 
                before the date of enactment of the Family Support Act 
                of 1988; and
                    ``(B) by October 1, 1999, which meets all 
                requirements of this part enacted on or before the date 
                of the enactment of the Work Opportunity Act of 1995, 
                except that such deadline shall be extended by 1 day 
                for each day (if any) by which the Secretary fails to 
                meet the deadline imposed by section 944(a)(3) of the 
                Work Opportunity Act of 1995.''.
    (b) Special Federal Matching Rate for Development Costs of 
Automated Systems.--
            (1) In general.--Section 455(a) (42 U.S.C. 655(a)) is 
        amended--
                    (A) in paragraph (1)(B)--
                            (i) by striking ``90 percent'' and 
                        inserting ``the percent specified in paragraph 
                        (3)'';
                            (ii) by striking ``so much of''; and
                            (iii) by striking ``which the Secretary'' 
                        and all that follows and inserting ``, and''; 
                        and
                    (B) by adding at the end the following new 
                paragraph:
    ``(3)(A) The Secretary shall pay to each State, for each quarter in 
fiscal years 1996 and 1997, 90 percent of so much of the State 
expenditures described in paragraph (1)(B) as the Secretary finds are 
for a system meeting the requirements specified in section 454(16) (as 
in effect on the day before the date of the enactment of the Work 
Opportunity Act of 1995), but limited to the amount approved for States 
in the advance planning documents of such States submitted before May 
1, 1995.
    ``(B)(i) The Secretary shall pay to each State, for each quarter in 
fiscal years 1997 through 2001, the percentage specified in clause (ii) 
of so much of the State expenditures described in paragraph (1)(B) as 
the Secretary finds are for a system meeting the requirements of 
sections 454(16) and 454A.
    ``(ii) The percentage specified in this clause is the greater of--
            ``(I) 80 percent; or
            ``(II) the percentage otherwise applicable to Federal 
        payments to the State under subparagraph (A) (as adjusted 
        pursuant to section 458).''.
            (2) Temporary limitation on payments under special federal 
        matching rate.--
                    (A) In general.--The Secretary of Health and Human 
                Services may not pay more than $260,000,000 in the 
                aggregate under section 455(a)(3) of the Social 
                Security Act for fiscal years 1996, 1997, 1998, 1999, 
                and 2000.
                    (B) Allocation of limitation among states.--The 
                total amount payable to a State under section 455(a)(3) 
                of such Act for fiscal years 1996, 1997, 1998, 1999, 
                and 2000 shall not exceed the limitation determined for 
                the State by the Secretary of Health and Human Services 
                in regulations.
                    (C) Allocation formula.--The regulations referred 
                to in subparagraph (B) shall prescribe a formula for 
                allocating the amount specified in subparagraph (A) 
                among States with plans approved under part D of title 
                IV of the Social Security Act, which shall take into 
                account--
                            (i) the relative size of State caseloads 
                        under such part; and
                            (ii) the level of automation needed to meet 
                        the automated data processing requirements of 
                        such part.
    (c) Conforming Amendment.--Section 123(c) of the Family Support Act 
of 1988 (102 Stat. 2352; Public Law 100-485) is repealed.

SEC. 945. TECHNICAL ASSISTANCE.

    (a) For Training of Federal and State Staff, Research and 
Demonstration Programs, and Special Projects of Regional or National 
Significance.--Section 452 (42 U.S.C. 652) is amended by adding at the 
end the following new subsection:
    ``(j) Out of any money in the Treasury of the United States not 
otherwise appropriated, there is hereby appropriated to the Secretary 
for each fiscal year an amount equal to 1 percent of the total amount 
paid to the Federal Government pursuant to section 457(a) during the 
immediately preceding fiscal year (as determined on the basis of the 
most recent reliable data available to the Secretary as of the end of 
the 3rd calendar quarter following the end of such preceding fiscal 
year), to cover costs incurred by the Secretary for--
            ``(1) information dissemination and technical assistance to 
        States, training of State and Federal staff, staffing studies, 
        and related activities needed to improve programs under this 
        part (including technical assistance concerning State automated 
        systems required by this part); and
            ``(2) research, demonstration, and special projects of 
        regional or national significance relating to the operation of 
        State programs under this part.''.
    (b) Operation of Federal Parent Locator Service.--Section 453 (42 
U.S.C. 653), as amended by section 916(f), is amended by adding at the 
end the following new subsection:
    ``(n) Out of any money in the Treasury of the United States not 
otherwise appropriated, there is hereby appropriated to the Secretary 
for each fiscal year an amount equal to 2 percent of the total amount 
paid to the Federal Government pursuant to section 457(a) during the 
immediately preceding fiscal year (as determined on the basis of the 
most recent reliable data available to the Secretary as of the end of 
the 3rd calendar quarter following the end of such preceding fiscal 
year), to cover costs incurred by the Secretary for operation of the 
Federal Parent Locator Service under this section, to the extent such 
costs are not recovered through user fees.''.

SEC. 946. REPORTS AND DATA COLLECTION BY THE SECRETARY.

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

      Subtitle F--Establishment and Modification of Support Orders

SEC. 951. NATIONAL CHILD SUPPORT GUIDELINES COMMISSION.

    (a) Establishment.--There is hereby established a commission to be 
known as the National Child Support Guidelines Commission (in this 
section referred to as the ``Commission'').
    (b) General Duties.--
            (1) In general.--The Commission shall determine--
                    (A) whether it is appropriate to develop a national 
                child support guideline for consideration by the 
                Congress or for adoption by individual States; or
                    (B) based on a study of various guideline models, 
                the benefits and deficiencies of such models, and any 
                needed improvements.
            (2) Development of models.--If the Commission determines 
        under paragraph (1)(A) that a national child support guideline 
        is needed or under paragraph (1)(B) that improvements to 
        guideline models are needed, the Commission shall develop such 
        national guideline or improvements.
    (c) Matters for Consideration by the Commission.--In making the 
recommendations concerning guidelines required under subsection (b), 
the Commission shall consider--
            (1) the adequacy of State child support guidelines 
        established pursuant to section 467;
            (2) matters generally applicable to all support orders, 
        including--
                    (A) the feasibility of adopting uniform terms in 
                all child support orders;
                    (B) how to define income and under what 
                circumstances income should be imputed; and
                    (C) tax treatment of child support payments;
            (3) the appropriate treatment of cases in which either or 
        both parents have financial obligations to more than 1 family, 
        including the effect (if any) to be given to--
                    (A) the income of either parent's spouse; and
                    (B) the financial responsibilities of either parent 
                for other children or stepchildren;
            (4) the appropriate treatment of expenses for child care 
        (including care of the children of either parent, and work-
        related or job-training-related child care);
            (5) the appropriate treatment of expenses for health care 
        (including uninsured health care) and other extraordinary 
        expenses for children with special needs;
            (6) the appropriate duration of support by 1 or both 
        parents, including--
                    (A) support (including shared support) for 
                postsecondary or vocational education; and
                    (B) support for disabled adult children;
            (7) procedures to automatically adjust child support orders 
        periodically to address changed economic circumstances, 
        including changes in the Consumer Price Index or either 
        parent's income and expenses in particular cases;
            (8) procedures to help noncustodial parents address 
        grievances regarding visitation and custody orders to prevent 
        such parents from withholding child support payments until such 
        grievances are resolved; and
            (9) whether, or to what extent, support levels should be 
        adjusted in cases in which custody is shared or in which the 
        noncustodial parent has extended visitation rights.
    (d) Membership.--
            (1) Number; appointment.--
                    (A) In general.--The Commission shall be composed 
                of 12 individuals appointed not later than January 15, 
                1997, of which--
                            (i) 2 shall be appointed by the Chairman of 
                        the Committee on Finance of the Senate, and 1 
                        shall be appointed by the ranking minority 
                        member of the Committee;
                            (ii) 2 shall be appointed by the Chairman 
                        of the Committee on Ways and Means of the House 
                        of Representatives, and 1 shall be appointed by 
                        the ranking minority member of the Committee; 
                        and
                            (iii) 6 shall be appointed by the Secretary 
                        of Health and Human Services.
                    (B) Qualifications of members.--Members of the 
                Commission shall have expertise and experience in the 
                evaluation and development of child support guidelines. 
                At least 1 member shall represent advocacy groups for 
                custodial parents, at least 1 member shall represent 
                advocacy groups for noncustodial parents, and at least 
                1 member shall be the director of a State program under 
                part D of title IV of the Social Security Act.
            (2) Terms of office.--Each member shall be appointed for a 
        term of 2 years. A vacancy in the Commission shall be filled in 
        the manner in which the original appointment was made.
    (e) Commission Powers, Compensation, Access to Information, and 
Supervision.--The 1st sentence of subparagraph (C), the 1st and 3rd 
sentences of subparagraph (D), subparagraph (F) (except with respect to 
the conduct of medical studies), clauses (ii) and (iii) of subparagraph 
(G), and subparagraph (H) of section 1886(e)(6) of the Social Security 
Act shall apply to the Commission in the same manner in which such 
provisions apply to the Prospective Payment Assessment Commission.
    (f) Report.--Not later than 2 years after the appointment of 
members, the Commission shall submit to the President, the Committee on 
Ways and Means of the House of Representatives, and the Committee on 
Finance of the Senate, a recommended national child support guideline 
and a final assessment of issues relating to such a proposed national 
child support guideline.
    (g) Termination.--The Commission shall terminate 6 months after the 
submission of the report described in subsection (e).

SEC. 952. SIMPLIFIED PROCESS FOR REVIEW AND ADJUSTMENT OF CHILD SUPPORT 
              ORDERS.

    Section 466(a)(10) (42 U.S.C. 666(a)(10)) is amended to read as 
follows:
            ``(10) Procedures under which the State shall review and 
        adjust each support order being enforced under this part upon 
        the request of either parent or
         the State if there is an assignment. Such procedures shall 
provide the following:
                    ``(A) The State shall review and, as appropriate, 
                adjust the support order every 3 years, taking into 
                account the best interests of the child involved.
                    ``(B)(i) The State may elect to review and, if 
                appropriate, adjust an order pursuant to subparagraph 
                (A) by--
                            ``(I) reviewing and, if appropriate, 
                        adjusting the order in accordance with the 
                        guidelines established pursuant to section 
                        467(a) if the amount of the child support award 
                        under the order differs from the amount that 
                        would be awarded in accordance with the 
                        guidelines; or
                            ``(II) applying a cost-of-living adjustment 
                        to the order in accordance with a formula 
                        developed by the State and permit either party 
                        to contest the adjustment, within 30 days after 
                        the date of the notice of the adjustment, by 
                        making a request for review and, if 
                        appropriate, adjustment of the order in 
                        accordance with the child support guidelines 
                        established pursuant to section 467(a).
                    ``(ii) Any adjustment under clause (i) shall be 
                made without a requirement for proof or showing of a 
                change in circumstances.
                    ``(C) The State may use automated methods 
                (including automated comparisons with wage or State 
                income tax data) to identify orders eligible for 
                review, conduct the review, identify orders eligible 
                for adjustment, and apply the appropriate adjustment to 
                the orders eligible for adjustment under the threshold 
                established by the State.
                    ``(D)(i) The State shall, at the request of either 
                parent subject to such an order or of any State child 
                support enforcement agency, review and, if appropriate, 
                adjust the order in accordance with the guidelines 
                established pursuant to section 467(a) based upon a 
                substantial change in the circumstances of either 
                parent.
                    ``(ii) The State shall provide notice to the 
                parents subject to such an order informing them of 
                their right to request the State to review and, if 
                appropriate, adjust the order pursuant to clause (i). 
                The notice may be included in the order.''.

SEC. 953. FURNISHING CONSUMER REPORTS FOR CERTAIN PURPOSES RELATING TO 
              CHILD SUPPORT.

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

SEC. 954. NONLIABILITY FOR DEPOSITORY INSTITUTIONS PROVIDING FINANCIAL 
              RECORDS TO STATE CHILD SUPPORT ENFORCEMENT AGENCIES IN 
              CHILD SUPPORT CASES.

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

SEC. 961. INTERNAL REVENUE SERVICE COLLECTION OF ARREARAGES.

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

SEC. 962. AUTHORITY TO COLLECT SUPPORT FROM FEDERAL EMPLOYEES.

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

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

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

SEC. 963. ENFORCEMENT OF CHILD SUPPORT OBLIGATIONS OF MEMBERS OF THE 
              ARMED FORCES.

    (a) Availability of Locator Information.--
            (1) Maintenance of address information.--The Secretary of 
        Defense shall establish a centralized personnel locator service 
        that includes the address of each member of the Armed Forces 
        under the jurisdiction of the Secretary. Upon request of the 
        Secretary of Transportation, addresses for members of the Coast 
        Guard shall be included in the centralized personnel locator 
        service.
            (2) Type of address.--
                    (A) Residential address.--Except as provided in 
                subparagraph (B), the address for a member of the Armed 
                Forces shown in the locator service shall be the 
                residential address of that member.
                    (B) Duty address.--The address for a member of the 
                Armed Forces shown in the locator service shall be the 
                duty address of that member in the case of a member--
                            (i) who is permanently assigned overseas, 
                        to a vessel, or to a routinely deployable unit; 
                        or
                            (ii) with respect to whom the Secretary 
                        concerned makes a determination that the 
                        member's residential address should not be 
                        disclosed due to national security or safety 
                        concerns.
            (3) Updating of locator information.--Within 30 days after 
        a member listed in the locator service establishes a new 
        residential address (or a new duty address, in the case of a 
        member covered by paragraph (2)(B)), the Secretary concerned 
        shall update the locator service to indicate the new address of 
        the member.
            (4) Availability of information.--The Secretary of Defense 
        shall make information regarding the address of a member of the 
        Armed Forces listed in the locator service available, on 
        request, to the Federal Parent Locator Service established 
        under section 453 of the Social Security Act.
    (b) Facilitating Granting of Leave for Attendance at Hearings.--
            (1) Regulations.--The Secretary of each military 
        department, and the Secretary of Transportation with respect to 
        the Coast Guard when it is not operating as a service in the 
        Navy, shall prescribe regulations to facilitate the granting of 
        leave to a member of the Armed Forces under the jurisdiction of 
        that Secretary in a case in which--
                    (A) the leave is needed for the member to attend a 
                hearing described in paragraph (2);
                    (B) the member is not serving in or with a unit 
                deployed in a contingency operation (as defined in 
                section 101 of title 10, United States Code); and
                    (C) the exigencies of military service (as 
                determined by the Secretary concerned) do not otherwise 
                require that such leave not be granted.
            (2) Covered hearings.--Paragraph (1) applies to a hearing 
        that is conducted by a court or pursuant to an administrative 
        process established under State law, in connection with a civil 
        action--
                    (A) to determine whether a member of the Armed 
                Forces is a natural parent of a child; or
                    (B) to determine an obligation of a member of the 
                Armed Forces to provide child support.
            (3) Definitions.--For purposes of this subsection:
                    (A) The term ``court'' has the meaning given that 
                term in section 1408(a) of title 10, United States 
                Code.
                    (B) The term ``child support'' has the meaning 
                given such term in section 459(i) of the Social 
                Security Act (42 U.S.C. 659(i)).
    (c) Payment of Military Retired Pay in Compliance With Child 
Support Orders.--
            (1) Date of certification of court order.--Section 1408 of 
        title 10, United States Code, as amended by section 962(c)(4), 
        is amended--
                    (A) by redesignating subsections (i) and (j) as 
                subsections (j) and (k), respectively; and
                    (B) by inserting after subsection (h) the following 
                new subsection:
    ``(i) Certification Date.--It is not necessary that the date of a 
certification of the authenticity or completeness of a copy of a court 
order for child support received by the Secretary concerned for the 
purposes of this section be recent in relation to the date of receipt 
by the Secretary.''.
            (2) Payments consistent with assignments of rights to 
        states.--Section 1408(d)(1) of such title is amended by 
        inserting after the 1st sentence the following: ``In the case 
        of a spouse or former spouse who assigns to a State the rights 
        of the spouse or former spouse to receive support, the 
        Secretary concerned may make the child support payments 
        referred to in the preceding sentence to that State in amounts 
        consistent with that assignment of rights.''.
            (3) Arrearages owed by members of the uniformed services.--
        Section 1408(d) of such title is amended by adding at the end 
        the following new paragraph:
    ``(6) In the case of a court order for which effective service is 
made on the Secretary concerned on or after the date of the enactment 
of this paragraph and which provides for payments from the disposable 
retired pay of a member to satisfy the amount of child support set 
forth in the order, the authority provided in paragraph (1) to make 
payments from the disposable retired pay of a member to satisfy the 
amount of child support set forth in a court order shall apply to 
payment of any amount of child support arrearages set forth in that 
order as well as to amounts of child support that currently become 
due.''.
            (4) Payroll deductions.--The Secretary of Defense shall 
        begin payroll deductions within 30 days after receiving notice 
        of withholding, or for the 1st pay period that begins after 
        such 30-day period.

SEC. 964. VOIDING OF FRAUDULENT TRANSFERS.

    Section 466 (42 U.S.C. 666), as amended by section 921, is amended 
by adding at the end the following new subsection:
    ``(g) In order to satisfy section 454(20)(A), each State must have 
in effect--
            ``(1)(A) the Uniform Fraudulent Conveyance Act of 1981;
            ``(B) the Uniform Fraudulent Transfer Act of 1984; or
            ``(C) another law, specifying indicia of fraud which create 
        a prima facie case that a debtor transferred income or property 
        to avoid payment to a
         child support creditor, which the Secretary finds affords 
comparable rights to child support creditors; and
            ``(2) procedures under which, in any case in which the 
        State knows of a transfer by a child support debtor with 
        respect to which such a prima facie case is established, the 
        State must--
                    ``(A) seek to void such transfer; or
                    ``(B) obtain a settlement in the best interests of 
                the child support creditor.''.

SEC. 965. WORK REQUIREMENT FOR PERSONS OWING CHILD SUPPORT.

    Section 466(a) of the Social Security Act (42 U.S.C. 666(a)), as 
amended by sections 901(a), 915, 917(a), and 923, is amended by adding 
at the end the following new paragraph:
            ``(16) Procedures requiring the State, in any case in which 
        an individual owes support with respect to a child receiving 
        services under this part, to seek a court order or 
        administrative order that requires the individual to--
                    ``(A) pay such support in accordance with a plan 
                approved by the court; or
                    ``(B) if the individual is not working and is not 
                incapacitated, participate in work activities 
                (including, at State option, work activities as defined 
                in section 482) as the court deems appropriate.''.

SEC. 966. DEFINITION OF SUPPORT ORDER.

    Section 453 (42 U.S.C. 653) as amended by sections 916 and 945(b), 
is amended by adding at the end the following new subsection:
    ``(o) As used in this part, the term `support order' means a 
judgment, decree, or order, whether temporary, final, or subject to 
modification, issued by a court or an administrative agency of 
competent jurisdiction, for the support and maintenance of a child, 
including a child who has attained the age of majority under the law of 
the issuing State, or a child and the parent with whom the child is 
living, which provides for monetary support, health care, arrearages, 
or reimbursement, and which may include related costs and fees, 
interest and penalties, income withholding, attorneys' fees, and other 
relief.''.

SEC. 967. REPORTING ARREARAGES TO CREDIT BUREAUS.

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

SEC. 968. LIENS.

    Section 466(a)(4) (42 U.S.C. 666(a)(4)) is amended to read as 
follows:
            ``(4) Procedures under which--
                    ``(A) liens arise by operation of law against real 
                and personal property for amounts of overdue support 
                owed by an absent parent who resides or owns property 
                in the State; and
                    ``(B) the State accords full faith and credit to 
                liens described in subparagraph (A) arising in another 
                State, without registration of the underlying order.''.
SEC. 969. STATE LAW AUTHORIZING SUSPENSION OF LICENSES.

    Section 466(a) (42 U.S.C. 666(a)), as amended by sections 915, 
917(a), and 923, is amended by adding at the end the following new 
paragraph:
            ``(15) Procedures under which the State has (and uses in 
        appropriate cases) authority to withhold or suspend, or to 
        restrict the use of, driver's licenses, professional and 
        occupational licenses, and recreational licenses of individuals 
        owing overdue support or failing, after receiving appropriate 
        notice, to comply with subpoenas or warrants relating to 
        paternity or child support proceedings.''.

SEC. 970. DENIAL OF PASSPORTS FOR NONPAYMENT OF CHILD SUPPORT.

    (a) HHS Certification Procedure.--
            (1) Secretarial responsibility.--Section 452 (42 U.S.C. 
        652), as amended by section 945, is amended by adding at the 
        end the following new subsection:
    ``(k)(1) If the Secretary receives a certification by a State 
agency in accordance with the requirements of section 454(31) that an 
individual owes arrearages of child support in an amount exceeding 
$5,000, the Secretary shall transmit such certification to the 
Secretary of State for action (with respect to denial, revocation, or 
limitation of passports) pursuant to section 470(b) of the Work 
Opportunity Act of 1995.
    ``(2) The Secretary shall not be liable to an individual for any 
action with respect to a certification by a State agency under this 
section.''.
            (2) State cse agency responsibility.--Section 454 (42 
        U.S.C. 654), as amended by sections 901(b), 904(a), 912(b), 
        913(a), 933, and 943(a), is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (29);
                    (B) by striking the period at the end of paragraph 
                (30) and inserting ``; and''; and
                    (C) by adding after paragraph (30) the following 
                new paragraph:
            ``(31) provide that the State agency will have in effect a 
        procedure (which may be combined with the procedure for tax 
        refund offset under section 464) for certifying to the 
        Secretary, for purposes of the procedure under section 452(k) 
        (concerning denial of passports), determinations that 
        individuals owe arrearages of child support in an amount 
        exceeding $5,000, under which procedure--
                    ``(A) each individual concerned is afforded notice 
                of such determination and the consequences thereof, and 
                an opportunity to contest the determination; and
                    ``(B) the certification by the State agency is 
                furnished to the Secretary in such format, and 
                accompanied by such supporting documentation, as the 
                Secretary may require.''.
    (b) State Department Procedure for Denial of Passports.--
            (1) In general.--The Secretary of State shall, upon 
        certification by the Secretary of Health and Human Services 
        transmitted under section 452(k) of the Social Security Act, 
        refuse to issue a passport to such individual, and may revoke, 
        restrict, or limit a passport issued previously to such 
        individual.
            (2) Limit on liability.--The Secretary of State shall not 
        be liable to an individual for any action with respect to a 
        certification by a State agency under this section.
    (c) Effective Date.--This section and the amendments made by this 
section shall become effective October 1, 1996.
SEC. 971. INTERNATIONAL CHILD SUPPORT ENFORCEMENT.

    The Secretary of State is authorized to negotiate reciprocal 
agreements with foreign nations on behalf of the States, territories, 
and possessions of the United States regarding the international 
enforcement of child support obligations and designating the Department 
of Health and Human Services as the central authority for such 
enforcement.

                      Subtitle H--Medical Support

SEC. 975. TECHNICAL CORRECTION TO ERISA DEFINITION OF MEDICAL CHILD 
              SUPPORT ORDER.

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

SEC. 976. ENFORCEMENT OF ORDERS FOR HEALTH CARE COVERAGE.

    Section 466(a) (42 U.S.C. 666(a)), as amended by sections 915, 
917(a), 923, and 968, is amended by adding at the end the following new 
paragraph:
            ``(16) Procedures under which all child support orders 
        enforced under this part shall include a provision for the 
        health care coverage of the child, and in the case in which an 
        absent parent provides such coverage and changes employment, 
        and the new employer provides health care coverage, the State 
        agency shall transfer notice of the provision to the employer, 
        which notice shall operate to enroll the child in the absent 
        parent's health plan, unless the absent parent contests the 
        notice.''.

Subtitle I--Enhancing Responsibility and Opportunity for Nonresidential 
                                Parents

SEC. 981. GRANTS TO STATES FOR ACCESS AND VISITATION PROGRAMS.

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

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

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

                    Subtitle J--Effect of Enactment

SEC. 991. EFFECTIVE DATES.

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

SEC. 1001. CEILING RENTS.

    Section 3(a)(2) of the United States Housing Act of 1937 (42 U.S.C. 
1437a(a)(2)) is amended to read as follows:
    ``(2) Establishment of ceiling rents.--
            ``(A) In general.--A public housing agency may provide that 
        each family residing in a public housing project shall pay 
        monthly rent in an amount established by such agency in 
        accordance with this paragraph.
            ``(B) Limitations on amount.--The rental amount established 
        under subparagraph (A)--
                    ``(i) shall reflect the reasonable rental value of 
                the dwelling unit in which the family resides, as 
                compared with similar types and sizes of dwelling units 
                in the market area in which the public housing project 
                is located;
                    ``(ii) shall be greater than or equal to the 
                monthly cost to operate the housing (including any 
                replacement reserves at the discretion of the public 
                housing agency); and
                    ``(iii) shall not exceed the amount payable as rent 
                by such family under paragraph (1).''.

SEC. 1002. DEFINITION OF ADJUSTED INCOME FOR PUBLIC HOUSING.

    (a) Definition of Adjusted Income.--Section 3(b)(5) of the United 
States Housing Act of 1937 (42 U.S.C. 1437a(b)(5)) is amended to read 
as follows:
            ``(5) The term `adjusted income' means the income that 
        remains after excluding--
                    ``(A) $480 for each member of the family residing 
                in the household (other than the head of the household 
                or spouse)--
                            ``(i) who is under 18 years of age; or
                            ``(ii) who is--
                                    ``(I) 18 years of age or older; and
                                    ``(II) a person with disabilities 
                                or a full-time student;
                    ``(B) $400 for an elderly or disabled family;
                    ``(C) the amount by which the aggregate of--
                            ``(i) medical expenses for an elderly or 
                        disabled family; and
                            ``(ii) reasonable attendant care and 
                        auxiliary apparatus expenses for each family 
                        member who is a person with disabilities, to 
                        the extent necessary to enable any member of 
                        the family (including a member who is a person 
                        with disabilities) to be employed;
                exceeds 3 percent of the annual income of the family;
                    ``(D) child care expenses, to the extent necessary 
                to enable another member of the family to be employed 
                or to further his or her education;
                    ``(E) excessive travel expenses, not to exceed $25 
                per family per week, for employment- or education-
                related travel, except that this subparagraph shall 
                apply only to a family assisted by an Indian housing 
                authority; and
                    ``(F) subject to the requirements of subsection 
                (e), for public housing, adjustments to earned income 
                established by the public housing agency, not to exceed 
                20 percent of the earned income of the family.''.
    (b) Adjustments to Definition of Earned Income.--Section 3 of the 
United States Housing Act of 1937 (42 U.S.C. 1437a) is amended--
            (1) in the first undesignated paragraph immediately 
        following subsection (c)(3) (as added by section 515(b) of the 
        Cranston-Gonzalez National Affordable Housing Act), by striking 
        ``The earnings of'' and inserting the following:
    ``(d) Exclusion of Certain Earnings.--The earnings of''; and
            (2) by adding at the end the following new subsection:
    ``(e) Adjustments to Earned Income.--If a public housing agency 
establishes any adjustment to income pursuant to subsection (b)(5)(F), 
the Secretary--
            ``(1) shall not take into account any reduction of the per 
        dwelling unit rental income of the public housing agency 
        resulting from that adjustment in calculating the contributions 
        under section 9 for the public housing agency for the operation 
        of the public housing; and
            ``(2) shall not reduce the level of operating subsidies 
        payable to the public housing agency due to an increase in per 
        dwelling unit rental income that results from a higher level of 
        income earned by any residents whose adjusted incomes are 
        calculated taking into account that adjustment to income, until 
        the public housing agency has recovered a sum equal to the 
        cumulative difference between--
                    ``(A) the operating subsidies actually received by 
                the agency; and
                    ``(B) the operating subsidies that the public 
                housing agency would have received if paragraph (1) was 
                not applied.''.
    (c) Report.--Not later than 3 years after the date of enactment of 
this Act, the Comptroller General of the United States shall submit a 
report to the Congress describing the fiscal and societal impact of the 
amendment made by subsection (b)(2).
    (d) Repeal of Certain Provisions.--
            (1) Maximum annual limitation on rent increases resulting 
        from employment.--Section 957 of the Cranston-Gonzalez National 
        Affordable Housing Act (42 U.S.C. 12714) is repealed effective 
        November 28, 1990.
            (2) Economic independence.--Section 923 of the Housing and 
        Community Development Act of 1992 (42 U.S.C. 12714 note) is 
        repealed effective October 28, 1992.

SEC. 1003. EXEMPTION OF TENANTS FROM LABOR STANDARDS.

    Section 12 of the United States Housing Act of 1937 (42 U.S.C. 
1437j) is amended by adding at the end the following new subsection:
    ``(c) Additional Exemption.--Subsection (a) and any provision 
relating to wages (pursuant to subsection (a)) in any contract for 
loans, contributions, sale, or lease pursuant to this Act, shall not 
apply to any individual who is receiving assistance under this Act.''.

SEC. 1004. FAILURE TO COMPLY WITH OTHER WELFARE AND PUBLIC ASSISTANCE 
              PROGRAMS.

    Title I of the United States Housing Act of 1937 (42 U.S.C. 1437 et 
seq.) is amended by adding at the end the following new section:

``SEC. 27. FAILURE TO COMPLY WITH OTHER WELFARE AND PUBLIC ASSISTANCE 
              PROGRAMS.

    ``(a) In General.--If the benefits of a family are reduced under a 
Federal, State, or local law relating to welfare or a public assistance 
program for the failure of any member of the family to perform an 
action required under the law or program, the family may not, for the 
duration of the reduction, receive any increased assistance under this 
Act as the result of a decrease in the income of the family to the 
extent that the decrease in income is the result of the benefits 
reduction.
    ``(b) Exception.--Subsection (a) shall not apply in any case in 
which the benefits of a family are reduced because the welfare or 
public assistance program to which the Federal, State, or local law 
relates limits the period during which benefits may be provided under 
the program.''.

SEC. 1005. APPLICABILITY TO INDIAN HOUSING.

    (a) In General.--In accordance with section 201(b)(2) of the United 
States Housing Act of 1937, the amendments made by this title shall 
apply to public housing developed or operated pursuant to a contract 
between the Secretary and an Indian housing authority.
    (b) Definitions.--For purposes of this section--
            (1) the term ``Indian housing authority'' has the same 
        meaning as in section 3(b) of the United States Housing Act of 
        1937;
            (2) the term ``public housing'' has the same meaning as in 
        section 3(b) of the United States Housing Act of 1937; and
            (3) the term ``Secretary'' means the Secretary of Housing 
        and Urban Development.

SEC. 1006. IMPLEMENTATION.

    The Secretary shall issue such regulations as may be necessary to 
carry out this title and the amendments made by this title.

SEC. 1007. EFFECTIVE DATE.

    This title and the amendments made by this title shall take effect 
on the date of enactment of this Act.
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S 1120 IS----25
S 1120 IS----26
S 1120 IS----27
S 1120 IS----28
S 1120 IS----29
S 1120 IS----30
S 1120 IS----31
S 1120 IS----32
S 1120 IS----33
S 1120 IS----34
S 1120 IS----35
S 1120 IS----36
S 1120 IS----37
S 1120 IS----38
S 1120 IS----39
S 1120 IS----40