[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3113 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 3113

 To reauthorize and improve the program of block grants to States for 
                temporary assistance for needy families.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 12, 2001

 Mrs. Mink of Hawaii (for herself, Mr. Bonior, Ms. Carson of Indiana, 
Mrs. Clayton, Mr. Clay, Mr. Evans, Mr. Farr of California, Mr. Filner, 
Mr. Gutierrez, Mr. Hastings of Florida, Mr. Hilliard, Mr. Hinchey, Ms. 
  Eddie Bernice Johnson of Texas, Mr. Kucinich, Ms. Lee, Mr. Lewis of 
    Georgia, Ms. Lofgren, Mr. McDermott, Ms. McKinney, Mrs. Meek of 
   Florida, Mr. Nadler, Ms. Norton, Mr. Owens, Mr. Payne, Ms. Roybal-
Allard, Ms. Schakowsky, Ms. Solis, Mr. Stark, Ms. Waters, Ms. Woolsey, 
  and Ms. Brown of Florida) introduced the following bill; which was 
              referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
 To reauthorize and improve the program of block grants to States for 
                temporary assistance for needy families.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``TANF Reauthorization Act of 2001''.

SEC. 2. TABLE OF CONTENTS.

    The table of contents of this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Findings.
Sec. 4. Amendment of Social Security Act.
                      TITLE I--GENERAL PROVISIONS

Sec. 101. Purposes.
Sec. 102. State plan.
Sec. 103. Funding.
Sec. 104. Use of funds.
                      TITLE II--WORK REQUIREMENTS

Sec. 201. Reduced work requirement for parents of school-age children 
                            who cannot find adequate child care.
Sec. 202. Conforming the number of weeks to the unemployment insurance 
                            compensation standard.
Sec. 203. Revision of work activities.
Sec. 204. Penalties against individuals for unjustified refusal to 
                            work; additional justifications.
Sec. 205. Elimination of miscellaneous provisions.
                 TITLE III--PROHIBITIONS; REQUIREMENTS

Sec. 301. Replacement of requirement to sanction individual for 
                            noncooperation in establishing paternity or 
                            obtaining child support with prohibition on 
                            requiring such cooperation.
Sec. 302. Prohibition on requiring assignment of support rights to the 
                            State; return of support rights assigned to 
                            the State.
Sec. 303. Elimination of sanction against teenage parents not attending 
                            high school or other equivalent training 
                            program.
Sec. 304. Requirements relating to disregard of child support.
Sec. 305. Elimination of sanction against teenage parents not living in 
                            adult-supervised settings.
Sec. 306. Protection for children.
Sec. 307. 5-year time limit.
Sec. 308. Requirement to provide notice of rights of recipients, and 
                            train program personnel in carrying out 
                            program consistent with the rights.
Sec. 309. Requirement to provide information to individuals who are, or 
                            are at risk of being, sanctioned.
Sec. 310. Ban on counting income, scholarship, or gift received by 
                            dependent minors.
Sec. 311. Ban on diversion of potential applicants for assistance.
Sec. 312. Prohibition on requiring recipients to respond to surveys 
                            conducted to obtain information for 
                            quarterly reports.
Sec. 313. Confidentiality of program information.
Sec. 314. Nondiscrimination.
Sec. 315. Requirement to provide opportunity to appeal adverse 
                            decision.
Sec. 316. Clarification of penalty for failure to comply with 
                            individual responsibility plan.
Sec. 317. Applicability of civil rights laws.
Sec. 318. Elimination of special rules relating to treatment of aliens.
                          TITLE IV--PENALTIES

Sec. 401. Increase in penalty for failure to submit required report.
Sec. 402. Replacement of penalty against State for failure to comply 
                            with paternity establishment and child 
                            support enforcement requirements with 
                            penalty for requiring cooperation in 
                            establishing paternity or obtaining child 
                            support (including assigning support rights 
                            to the State).
Sec. 403. Extension of maintenance of effort requirement.
Sec. 404. Penalty for failure of State to comply with child support 
                            disregard requirements.
Sec. 405. Penalty for penalizing birth of child.
Sec. 406. Penalty for failure to notify recipients of rights, or train 
                            program personnel in respecting rights of 
                            recipients.
Sec. 407. Penalty for failure to provide information to individuals who 
                            are, or are at risk of being, sanctioned.
Sec. 408. Penalty for counting income, scholarship, or gift received by 
                            dependent minor.
Sec. 409. Penalty for diverting potential applicant for assistance.
Sec. 410. Penalty for requiring recipient to respond to survey 
                            conducted to obtain information for 
                            quarterly report.
Sec. 411. Penalty for unauthorized disclosure of information provided 
                            by recipient.
Sec. 412. Penalty for discrimination.
Sec. 413. Penalty for failure to provide opportunity to appeal adverse 
                            decision.
Sec. 414. Penalty for failure to comply with minimum benefit rules.
Sec. 415. Penalty for failure to provide individual child care 
                            entitlement.
Sec. 416. Failure to submit report on welfare access and outcomes.
Sec. 417. Elimination of reasonable cause exception.
Sec. 418. Modification of availability of corrective compliance plan 
                            option.
Sec. 419. Repeal of ban on assistance for persons convicted of a drug 
                            felony.
                      TITLE V--STUDIES AND REPORTS

Sec. 501. Additional information to be included in quarterly State 
                            reports.
Sec. 502. Elimination from secretarial report to the Congress of 
                            information on out-of-wedlock pregnancies.
Sec. 503. Access to welfare; welfare outcomes.
Sec. 504. Assessment of regional economies to identify higher entry 
                            level wage opportunities in industries 
                            experiencing labor shortages.
Sec. 505. Research, evaluations, and national studies.
Sec. 506. Study by the Census Bureau.
                           TITLE VI--WAIVERS

Sec. 601. Waivers.
          TITLE VII--REPEAL OF LIMITATION ON FEDERAL AUTHORITY

Sec. 701. Repeal of limitation on Federal authority.
                   TITLE VIII--MINIMUM BENEFIT RULES

Sec. 801. Minimum benefit rules.
                          TITLE IX--CHILD CARE

Sec. 901. Individual entitlement to child care.
                  TITLE X--DEFINITION OF POVERTY LINE

Sec. 1001. Definition of poverty line.
                      TITLE XI--SERVICE PROVIDERS

Sec. 1101. Protection for beneficiaries.
                       TITLE XII--EFFECTIVE DATE

Sec. 1201. Effective date.

SEC. 3. FINDINGS.

    The Congress finds the following:
            (1) Welfare reform has reduced the welfare caseload but has 
        failed to move families out of poverty. More than 40 percent of 
        former welfare recipients continued to live below the poverty 
        line in 1999. Employed former recipients earn a median hourly 
        wage of $7.15. Because challenges to economic opportunity and 
        well-being are not adequately addressed by current welfare 
        programs, existing law must be changed to ensure that welfare 
        policy effectively promotes the reduction of poverty.
            (2) Between 1995 and 1999, a strong economy reduced poverty 
        by about 2 percent. Reductions in Government transfer payments 
        during this period, however, eliminated almost all of the 
        antipoverty effectiveness of economic growth. Prior to welfare 
        reform, between 1993 and 1995, Government transfer payments had 
        produced the opposite effect, reducing poverty among American 
        families.
            (3) About \1/3\ of people who have left welfare say they 
        have had to cut the size of meals or skip meals because they 
        did not have enough food in the house.
            (4) Over 40 percent of welfare leavers report that they 
        have had trouble paying housing and utility bills since leaving 
        welfare.
            (5) Since welfare reform was enacted in 1996, and despite a 
        strong economy, there have been sharp increases in the rates at 
        which single mothers with children have had to rely on food 
        pantries and homeless shelters.
            (6) An estimated \1/3\ to \1/2\ of all families leaving 
        welfare for work do not receive medical assistance, food 
        stamps, or child care to which they are entitled.
            (7) Only 1,500,000 of the 9,900,000 children who are 
        eligible for child care subsidies under their States' 
        eligibility guidelines receive child care assistance.
            (8) Between 1997 and 1999, over 500,000 families were 
        sanctioned off welfare and these families have been more likely 
        to experience poverty than have other families leaving welfare. 
        On a variety of measures, families who have been sanctioned off 
        welfare tend to fare worse than other leavers.
            (9) States in which African Americans make up a higher 
        proportion of recipients are statistically more likely to adopt 
        full-family sanctions. African American recipients are 
        statistically more likely than white recipients to participate 
        in a TANF program that employs full-family sanctions. African-
        American families have, in fact, been sanctioned more 
        frequently than their white counterparts.
            (10) States in which African Americans make up a higher 
        proportion of recipients are statistically more likely to adopt 
        family cap policies. African American recipients are 
        statistically more likely than white recipients to participate 
        in a TANF program that employs a family cap policy.
            (11) States in which African Americans make up a higher 
        proportion of recipients are statistically more likely to adopt 
        time limits shorter than the Federal Government requires. 
        Approximately \2/3\ of all families that will exhaust their 
        allowable time on welfare are families of color.
            (12) Overall, 78 percent of children with immigrant parents 
        are themselves born in the United States and are therefore 
        eligible for services if poor. Nearly \1/4\ of all children of 
        immigrants live in poor families and 23 percent of all poor 
        children in the United States are either first- or second-
        generation immigrants. Immigrants whose children are eligible 
        for public benefits often don't know about the services, are 
        afraid to access them, or are incorrectly turned away.
            (13) About 25 percent of former welfare recipients have no 
        paid employment and have either no partner or a partner who is 
        unemployed.
            (14) Under welfare reform, single mothers have been forced 
        to work at unsafe and hazardous job sites and to be subject to 
        sexual harassment and racial discrimination.
            (15) Most single mothers who leave welfare for work do not 
        earn enough in wages to lift their families out of poverty, 
        even several years after leaving welfare. 55 percent remain 
        poor 1 year after leaving welfare; 49 percent 3 years after and 
        42 percent 5 years after. Only about \1/3\ of all leavers have 
        incomes above 150 percent of the poverty line years after going 
        off welfare.
            (16) Adolescent children of single mothers who have left 
        welfare for work have school performance rates below those of 
        other low-income children. Early studies of families in 
        welfare-to-work programs in Florida, Minnesota, and Canada have 
        found unexpected evidence that their adolescent children have 
        lower academic achievement and more behavioral problems than 
        the children of other welfare households. The researchers 
        hypothesized that parents in the programs might have less time 
        and energy to monitor their adolescents' behavior once they 
        were employed; that under the stress of working, they might 
        adopt harsher parenting styles; or that the adolescents' 
        assuming more responsibilities at home when parents got jobs 
        was creating too great a burden.
            (17) Under welfare reform, when families lost income 
        regardless of the reason, children were more likely to 
        experience bad outcomes such as increased school suspensions, 
        behavior and mental health problems including symptoms of 
        depression, an increase in the number of children removed from 
        their mother's care, increased enrollment in special classes 
        for behavioral or emotional problems, and health problems such 
        as increased trips to the emergency room. In programs where 
        both employment and income were increased, the impact on 
        children was more positive.
            (18) Most single mothers on welfare who are eligible for 
        the exemption from cooperating in establishing paternity are 
        not made aware of this option.
            (19) 35 percent of low-income families reported mental 
        health problems according to a 1999 study. Similar rates of 
        mental health problems have been found among welfare 
        recipients. Among California welfare program participants, more 
        than \1/3\ had at least 1 diagnosable mental health problem in 
        the previous 12 months, and about 20 percent had 2 or more. 
        Nationally, between 70 and 90 percent of working-age adults 
        with serious mental health problems are unemployed. According 
        to a 2001 study, major depression significantly decreases the 
        likelihood that a woman receiving welfare will be employed and 
        the presence of 1 or more of 4 psychiatric disorders increases 
        the likelihood of receiving cash assistance by 32 percent.
            (20) Over half of women receiving welfare have been victims 
        of domestic violence as adults. According to several studies, a 
        quarter to a third of welfare recipients report having been 
        abused within the last year. Abusive partners often interfere 
        with women's attempts to work or to obtain education.

SEC. 4. AMENDMENT OF SOCIAL SECURITY ACT.

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

                      TITLE I--GENERAL PROVISIONS

SEC. 101. PURPOSES.

    Section 401(a)(1) (42 U.S.C. 601(a)(1)) is amended to read as 
follows:
            ``(1) In general.--The purpose of this part is to end child 
        and family poverty by--
                    ``(A) supporting caregivers so that children may be 
                cared for in their own homes;
                    ``(B) promoting education, training, work supports, 
                and access to jobs that pay a living wage;
                    ``(C) assuring access to Medicaid, Food Stamps, 
                child care, and such other assistance for which the 
                family is eligible;
                    ``(D) providing access to services to address 
                barriers to leaving poverty, including mental health, 
                disability, substance abuse, domestic violence, and 
                sexual assault; and
                    ``(E) reducing poverty of families with 
                children.''.

SEC. 102. STATE PLAN.

    (a) In General.--Section 402(a) (42 U.S.C. 602(a)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (A)--
                            (i) by striking clause (ii) and 
                        redesignating clauses (iii) and (iv) as clauses 
                        (ii) and (iii), respectively; and
                            (ii) by striking clauses (v) and (vi); and
                    (B) in subparagraph (B)--
                            (i) in clause (iii), by inserting ``and 
                        will notify recipients of assistance under the 
                        program of the rights of individuals under all 
                        laws applicable to program activities'' before 
                        the period;
                            (ii) by striking clauses (i) and (iv) and 
                        redesignating clauses (ii) and (iii) as clauses 
                        (i) and (ii), respectively;
            (2) in paragraph (7), by striking subparagraph (B) and 
        inserting the following:
                    ``(B) Domestic or sexual violence defined.--In this 
                title, the term `domestic or sexual violence' has the 
                same meaning as `battered or subject to extreme 
                cruelty' in section 402(a)(7)(C)(ii).''; and
            (3) by adding at the end the following:
            ``(7) Certifications regarding domestic and sexual 
        violence, mental illness, disability, and substance abuse.--
                    ``(A) Standards and procedures.--A certification by 
                the chief executive officer of the State that the State 
                has established and is enforcing standards and 
                procedures to ensure that the State will do the 
                following:
                            ``(i) Address recipient's barriers to 
                        leaving poverty.--Address the needs of a 
                        recipient who has a mental health problem, 
                        disability, or substance abuse addiction, or 
                        who is dealing with domestic or sexual 
                        violence, including how the State will, at the 
                        time of application, at a recipient's request, 
                        and before imposing any sanction or penalty for 
                        noncompliance--
                                    ``(I) have trained caseworkers 
                                screen, and, at the option of the 
                                recipient, qualified professionals 
                                assess and identify individuals who are 
                                dealing with a mental health problem, 
                                disability, substance abuse addiction, 
                                or domestic or sexual violence;
                                    ``(II) in the case of an individual 
                                who is so identified, at the option of 
                                the individual, refer the individual 
                                and affected children or other close 
                                family members for appropriate 
                                treatment, counseling, vocational 
                                rehabilitation, job training, and other 
                                services;
                                    ``(III) coordinate, contract, or 
                                hire appropriate licensed qualified 
                                professionals, including licensed 
                                qualified mental health service 
                                providers, licensed qualified 
                                physicians or medical service 
                                providers, licensed qualified substance 
                                abuse professionals, domestic violence 
                                coalitions, sexual assault coalitions, 
                                or victim services organizations;
                                    ``(IV) ensure the strict 
                                confidentiality of such information; 
                                and
                                    ``(V) pursuant to a determination 
                                of good cause, waive, without time 
                                limit, any State or Federal program 
                                requirement for so long as necessary in 
                                every case in which the requirement--
                                            ``(aa) makes it more 
                                        difficult for the individual to 
                                        manage his or her mental health 
                                        problem, disability, substance 
                                        abuse addiction, or domestic or 
                                        sexual violence situation;
                                            ``(bb) unfairly penalizes 
                                        the individual; or
                                            ``(cc) makes the individual 
                                        unsafe.
                            ``(ii) Use of qualified professionals.--
                        Enter into contracts with or employ qualified 
                        professionals for the provision of services in 
                        each of the fields of mental health, substance 
                        abuse, disability, and domestic or sexual 
                        violence, and that the contracts will require 
                        that, in the case of an individual who has 
                        multiple such barriers, the qualified 
                        professionals assigned to the case will 
                        collaborate to provide the individual with 
                        integrated, comprehensive services.
                    ``(B) Definitions.--In this paragraph:
                            ``(i) Domestic violence coalition.--The 
                        term `domestic violence coalition' means a 
                        nonprofit, nongovernmental membership 
                        organization that--
                                    ``(I) consists of the entities 
                                carrying out a majority of the domestic 
                                violence programs carried out in a 
                                State;
                                    ``(II) collaborates and coordinates 
                                activities with Federal, State, and 
                                local entities to further the purposes 
                                of domestic violence intervention and 
                                prevention; and
                                    ``(III) among other activities, 
                                provides training and technical 
                                assistance to entities carrying out 
                                domestic violence programs in a State, 
                                territory, political subdivision, or 
                                area under Federal authority.
                            ``(ii) Sexual assault coalition.--The term 
                        `sexual assault coalition' means a nonprofit, 
                        nongovernmental membership organization that--
                                    ``(I) consists of the entities 
                                carrying out a majority of the sexual 
                                assault programs carried out in a 
                                State;
                                    ``(II) collaborates and coordinates 
                                activities with Federal, State, and 
                                local entities to further the purposes 
                                of sexual assault intervention and 
                                prevention; and
                                    ``(III) among other activities, 
                                provides training and technical 
                                assistance to entities carrying out 
                                sexual assault programs in a State, 
                                territory, political subdivision, or 
                                area under Federal authority.
                            ``(iii) Victim services organization.--The 
                        term `victim services organization' means a 
                        nonprofit, nongovernmental organization that 
                        provides assistance to victims of domestic or 
                        sexual violence or to advocates for such 
                        victims, including a rape crisis center, an 
                        organization carrying out a domestic violence 
                        program, an organization operating a shelter or 
                        providing counseling services, or an 
                        organization providing assistance through the 
                        legal process.
                            ``(iv) Licensed qualified mental health 
                        service provider.--The term `licensed qualified 
                        mental health service provider' means a 
                        psychiatrist, clinical psychologist, clinical 
                        social worker, community mental health 
                        counselor, or other licensed individual who has 
                        appropriate training in the diagnosis and 
                        treatment of mental illness in children, 
                        adolescents, and adults or provides mental 
                        health services reimbursed under title XVIII or 
                        a State plan approved under title XIX.
                            ``(v) Qualified professional.--The term 
                        `qualified professional' means--
                                    ``(I) with respect to a disability, 
                                a physician or other licensed medical 
                                provider;
                                    ``(II) with respect to substance 
                                abuse, a licensed drug counselor or 
                                clinician with expertise in the 
                                assessment and treatment of parents 
                                with drug addiction issues, who may be 
                                affiliated with an out-patient or 
                                residential family drug or alcohol 
                                treatment program; or
                                    ``(III) with respect to domestic or 
                                sexual violence--
                                            ``(aa) a State or tribal 
                                        domestic violence coalition or 
                                        sexual assault coalition; or
                                            ``(bb) a State or local 
                                        victim services organization 
                                        with recognized expertise in 
                                        the dynamics of domestic or 
                                        sexual violence whose primary 
                                        mission is to provide services 
                                        to victims of domestic or 
                                        sexual violence, such as a rape 
                                        crisis center or domestic 
                                        violence program.
            ``(8) Certification regarding assessment of regional 
        economies and informing localities of sectoral labor 
        shortages.--A certification by the chief executive officer of 
        the State that, during the fiscal year, the State will assess 
        its regional economies and provide information to political 
        subdivisions of the State about the industrial sectors that are 
        experiencing a labor shortage and that provide higher entry-
        level wage opportunities for unemployed and underemployed job 
        seekers.''.

SEC. 103. FUNDING.

    (a) Family Assistance Grant.--Section 403(a)(1) (42 U.S.C. 
603(a)(1)) is amended in each of subparagraphs (A) and (E) by striking 
``1996, 1997, 1998, 1999, 2000, 2001, and 2002'' and inserting ``1996 
through 2008''.
    (b) Replacement of Bonus To Reward Decrease in Illegitimacy Ratio 
With Child Poverty Reduction Bonus.--Section 403(a)(2) (42 U.S.C. 
603(a)) is amended to read as follows:
            ``(2) Bonus to reward states that reduce child poverty.--
                    ``(A) In general.--Beginning with fiscal year 2003, 
                the Secretary shall make a grant pursuant to this 
                paragraph to each State for each fiscal year for which 
                the State is a qualified child poverty reduction State.
                    ``(B) Amount of grant.--
                            ``(i) In general.--Subject to this 
                        subparagraph, the amount of the grant to be 
                        made to a qualified child poverty reduction 
                        State for a fiscal year shall be an amount 
                        equal to--
                                    ``(I) the number of children who 
                                had not attained 18 years of age by the 
                                end of the then most recently completed 
                                calendar year and who resided in the 
                                State as of the end of such calendar 
                                year, divided by the number of such 
                                children who resided in the United 
                                States as of the end of such calendar 
                                year; multiplied by
                                    ``(II) the amount appropriated 
                                pursuant to subparagraph (F) for the 
                                fiscal year.
                            ``(ii) Limitations.--
                                    ``(I) Minimum grant.--The amount of 
                                the grant to be made to a qualified 
                                child poverty reduction State for a 
                                fiscal year shall be not less than 
                                $1,000,000.
                                    ``(II) Maximum grant.--The amount 
                                of the grant to be made to a qualified 
                                child poverty reduction State for a 
                                fiscal year shall not exceed an amount 
                                equal to 5 percent of the State family 
                                assistance grant for the fiscal year.
                            ``(iii) Pro rata increase.--If the amount 
                        available for grants under this paragraph for a 
                        fiscal year is greater than the total amount of 
                        payments otherwise required to be made under 
                        this paragraph for the fiscal year, then the 
                        amount otherwise payable to any State for the 
                        fiscal year under this paragraph shall, subject 
                        to clause (ii)(II), be increased by such equal 
                        percentage as may be necessary to ensure that 
                        the total of the amounts payable for the fiscal 
                        year under this paragraph equals the amount 
                        available for the grants.
                            ``(iv) Pro rata reduction.--If the amount 
                        available for grants under this paragraph for a 
                        fiscal year is less than the total amount of 
                        payments otherwise required to be made under 
                        this paragraph for the fiscal year, then the 
                        amount otherwise payable to any State for the 
                        fiscal year under this paragraph shall, subject 
                        to clause (ii)(I), be reduced by such equal 
                        percentage as may be necessary to ensure that 
                        the total of the amounts payable for the fiscal 
                        year under this paragraph equals the amount 
                        available for the grants.
                    ``(C) Use of grant.--A State to which a grant is 
                made under this paragraph shall use the grant for any 
                purpose for which a grant made under this part may be 
                used.
                    ``(D) Definitions.--In this paragraph:
                            ``(i) Qualified child poverty reduction 
                        state.--The term `qualified child poverty 
                        reduction State' means, with respect to a 
                        fiscal year, a State if--
                                    ``(I) the child poverty rate 
                                achieved by the State for the then most 
                                recently completed calendar year for 
                                which such information is available is 
                                less than the lowest child poverty rate 
                                achieved by the State during the 
                                applicable period; and
                                    ``(II) the average depth of child 
                                poverty in the State for the then most 
                                recently completed calendar year for 
                                which such information is available is 
                                not greater than the average depth of 
                                child poverty in the State for the 
                                calendar year that precedes such then 
                                most recently completed calendar year.
                            ``(ii) Applicable period.--In clause (i), 
                        the term `applicable period' means,  with 
respect to a State and the calendar year referred to in clause (i)(I), 
the period that--
                                    ``(I) begins with the calendar year 
                                that, as of October 1, 2002, precedes 
                                the then most recently completed 
                                calendar year for which such 
                                information is available; and
                                    ``(II) ends with the calendar year 
                                that precedes the calendar year 
                                referred to clause (i)(I).
                            ``(iii) Child poverty rate.--The term 
                        `child poverty rate' means, with respect to a 
                        State and a calendar year, the percentage of 
                        children residing in the State during the 
                        calendar year whose family income for the 
                        calendar year is less than the poverty line 
                        then applicable to the family.
                            ``(iv) Average depth of child poverty.--The 
                        term `average depth of child poverty' means 
                        with respect to a State and a calendar year, 
                        the average dollar amount by which family 
                        income is exceeded by the poverty line, among 
                        children in the State whose family income for 
                        the calendar year is less than the applicable 
                        poverty line.
                            ``(v) Poverty line.--The term `poverty 
                        line' has the meaning given the term in section 
                        673(2) of the Omnibus Budget Reconciliation Act 
                        of 1981, including any revision required by 
                        such section applicable to a family of the size 
                        involved.
                    ``(E) Family income determinations.--For purposes 
                of this paragraph, family income includes cash income, 
                child support payments, government cash payments, and 
                benefits under the Food Stamp Act of 1977 that are 
                received by any family member, and family income shall 
                be determined after payment of all taxes and receipt of 
                any tax refund or rebate by any family member.
                    ``(F) Appropriations.--
                            ``(i) In general.--Out of any money in the 
                        Treasury of the United States not otherwise 
                        appropriated, there are appropriated for fiscal 
                        year 2003 and each fiscal year thereafter 
                        $150,000,000 for grants under this paragraph.
                            ``(ii) Availability.--Amounts made 
                        available under clause (i) shall remain 
                        available until expended.''.
    (c) Supplemental Grant for Population Increases in Certain 
States.--Section 403(a)(3) (42 U.S.C. 603(a)) is amended--
            (1) in subparagraph (A)(ii), by striking ``, 2000, and 
        2001'' and inserting ``through 2008'';
            (2) by striking subparagraphs (C) and (D) and inserting the 
        following:
                    ``(C) Qualifying state.--For purposes of this 
                paragraph, a State is a qualifying State for a fiscal 
                year if rate at which the population of the State with 
                income less than 200 percent of the poverty line has 
                increased (as determined by the Bureau of the Census) 
                for the most recent fiscal year for which information 
                is available exceeds the such rate for all States (as 
                so determined) for such most recent fiscal year.
                    ``(D) State defined.--In this paragraph, the term 
                `State' means each of the 50 States of the United 
                States, the District of Columbia, Puerto Rico, the 
                United States Virgin Islands, and Guam.''; and
            (3) in subparagraph (E)--
                    (A) by striking ``1998, 1999, 2000, and 2001'' and 
                inserting ``2003 through 2008''; and
                    (B) by striking ``$800,000,000'' and inserting 
                ``$2,000,000,000''.
    (d) Amendment of Bonus to Reward High Performance States.--Section 
403(a)(4) (42 U.S.C. 603(a)(4)) is amended to read as follows:
            ``(4) Bonus to reward high performance states.--
                    ``(A) In general.--The Secretary shall make a grant 
                pursuant to this paragraph to each State for each bonus 
                year for which the State is a high performing State 
                with respect to a category described in subparagraph 
                (C).
                    ``(B) Amount of grant.--
                            ``(i) In general.--Subject to clause (ii) 
                        of this subparagraph, the Secretary shall 
                        determine the amount of the grant payable under 
                        this paragraph to a high performing State for a 
                        bonus year with respect to a category, which 
                        shall be based on the score assigned to the 
                        State under subparagraph (D)(i) with respect to 
                        the category for the fiscal year that 
                        immediately precedes the bonus year.
                            ``(ii) Limitation.--The total of the 
                        amounts payable to a State under this paragraph 
                        for a bonus year shall not exceed 5 percent of 
                        the State family assistance grant.
                    ``(C) Formula for measuring state performance.--Not 
                later than October 1, 2003, the Secretary shall, in 
                consultation with affected groups, including recipient 
                groups and State governors, issue regulations 
                implementing criteria for awarding of bonuses under 
                this paragraph in the following categories:
                            ``(i) Preparation and placement of 
                        recipients in employment that will move 
                        families out of poverty.--The degree of success 
                        in implementing employment-related measures, 
                        including job entry, job retention and earnings 
                        gain rates, improvement in each of such 
                        measures, and the success of States in--
                                    ``(I) meeting self-sufficiency 
                                needs for welfare leavers;
                                    ``(II) training, placing and 
                                retaining welfare leavers in higher-
                                waged jobs identified in the assessment 
                                most recently submitted by the State 
                                pursuant to section 411(d);
                                    ``(III) training, placing and 
                                retaining welfare leavers in technical, 
                                professional, or nontraditional 
                                occupations for women;
                                    ``(IV) providing career development 
                                assistance related to higher-waged jobs 
                                including reliable, up-to-date career 
                                counseling services, employability 
                                assessments on available employment 
                                that pays a sustainable wage, 
                                nontraditional training and education 
                                options, and employment opportunities;
                                    ``(V) encouraging participation in 
                                post-secondary educational programs;
                                    ``(VI) encouraging use of effective 
                                literacy programs that strengthen basic 
                                skills in the context of employment; 
                                and
                                    ``(VII) encouraging participation 
                                in vocational education programs for 
                                occupations identified in the 
                                assessment most recently submitted by 
                                the State pursuant to section 411(d).
                            ``(ii) Removal of barriers to self 
                        sufficiency.--The degree of success in removing 
                        mental health, substance abuse, disability, or 
                        domestic or sexual violence barriers to 
                        escaping poverty, which shall be based on an 
                        equal weighting of the following:
                                    ``(I) Notification.--The percentage 
                                of individuals receiving assistance 
                                under this part who report having been 
                                notified of the option to be assessed 
                                for and receive services to manage a 
                                barrier to escaping poverty. A State 
                                shall not be eligible for a grant under 
                                this paragraph with respect to the 
                                category described in this subparagraph 
                                unless at least 75 percent of the 
                                individuals surveyed by the State 
                                respond in the affirmative to the 
                                question of whether the individual has 
                                received the notification.
                                    ``(II) Training.--The percentage of 
                                caseworkers, supervisors, and new 
                                employees who have been trained in a 
                                curriculum developed by or in 
                                collaboration with qualified 
                                professionals in each of mental health, 
                                substance abuse, disability, or 
                                domestic or sexual violence services. A 
                                State shall not be eligible for a grant 
                                under this paragraph with respect to 
                                the category described in this 
                                subparagraph unless at least 80 percent 
                                of the caseworkers, supervisors, and 
                                employees administering the State 
                                program funded under this part have 
                                been trained in the curriculum.
                                    ``(III) Assessment and services.--
                                The State must certify that the State 
                                has contracts with or employs qualified 
                                professionals in mental health, 
                                substance abuse, disability, or 
                                domestic or sexual violence services, 
                                and that the contract requires that 
                                where an individual has multiple 
                                barriers the professional service 
                                providers will collaborate to provide 
                                the individual holistic services.
                            ``(iii) Provision of work supports.--The 
                        extent to which the State has increased the 
                        percentages described to in the following 
                        subclauses in comparison to the percentages 
                        achieved in fiscal year 2001:
                                    ``(I) Food stamps measures.--Of the 
                                number of families with children in the 
                                State who are eligible to receive food 
                                stamp benefits under the Food Stamp Act 
                                of 1977, the percentage who receive 
                                such benefits.
                                    ``(II) Medicaid and schip 
                                measures.--Of the individuals who have 
                                ceased receiving assistance under the 
                                State program funded under this part 
                                for 4 or more months, and are eligible 
                                to receive medical assistance under a 
                                State plan approved under title XIX or 
                                the child health assistance under a 
                                State plan approved under title XXI, 
                                the percentage who receive such medical 
                                or child health assistance.
                                    ``(III) Child care measures.--Of 
                                the children in the State who meet the 
                                maximum allowable Federal eligibility 
                                requirements for benefits under the 
                                Child Care and Development Block Grant 
                                Act of 1990, the percentage who receive 
                                such benefits, including any such 
                                children who receive child care 
                                benefits provided with additional State 
                                or Federal funds, including Head Start 
                                Funds. In taking the percentage into 
                                account for purposes of this clause, 
                                the Secretary shall also consider (aa) 
                                the affordability of child care 
                                subsidies by including a comparison of 
                                co-payment rates charged to eligible 
                                families, and (bb) the proportion of 
                                market rates paid to providers of 
                                subsidized child care as determined by 
                                a market rate survey that was taken not 
                                more than 2 years earlier.
                    ``(D) Scoring of state performance; setting of 
                performance thresholds.--For each bonus year, the 
                Secretary shall--
                            ``(i) use the formula developed under 
                        subparagraph (C) for a measure to assign a 
                        score to each eligible State with respect to 
                        the measure for the fiscal year that 
                        immediately precedes the bonus year; and
                            ``(ii) prescribe a performance threshold 
                        for each such measure in such a manner so as to 
                        ensure that--
                                    ``(I) the total amount of grants to 
                                be made under this paragraph with 
                                respect to a measure for a bonus year 
                                is not less than $60,000,000;
                                    ``(II) the average annual total 
                                amount of grants to be made under this 
                                paragraph for each bonus year equals 
                                $260,000,000; and
                                    ``(III) the total amount of grants 
                                to be made under this paragraph for all 
                                bonus years equals $1,820,000,000.
                    ``(E) Definitions.--In this paragraph:
                            ``(i) Bonus year.--The term `bonus year' 
                        means fiscal years 2002 through 2008.
                            ``(ii) High performing state.--The term 
                        `high performing State' means, with respect to 
                        a measure and a bonus year, an eligible State 
                        whose score assigned pursuant to subparagraph 
                        (D)(i) with respect to the measure for the 
                        fiscal year immediately preceding the bonus 
                        year equals or exceeds the performance 
                        threshold prescribed under subparagraph (D)(ii) 
                        with respect to the measure for such preceding 
                        fiscal year.
                    ``(F) Appropriation.--Out of any money in the 
                Treasury of the United States not otherwise 
                appropriated, there are appropriated for fiscal years 
                2002 through 2008 $1,820,000,000 for grants under this 
                paragraph.''.
    (e) Elimination of Welfare-to-Work Grants.--
            (1) In general.--
                    (A) Grants to states.--Section 403(a) (42 U.S.C. 
                603(a)) is amended by striking paragraph (5).
                    (B) Grants to indian tribes.--Section 412(a) (42 
                U.S.C. 612(a)) is amended by striking paragraph (3).
            (2) Conforming amendments.--
                    (A) Section 413 (42 U.S.C. 613) is amended by 
                striking subsection (j).
                    (B) Section 510 (42 U.S.C. 710) is repealed.
                    (C) Section 404(k)(1)(C) (42 U.S.C. 604(k)(1)(C)) 
                is amended--
                            (i) by adding ``and'' at the end of clause 
                        (ii);
                            (ii) by striking clause (iii); and
                            (iii) by redesignating clause (iv) as 
                        clause (iii).
    (f) 50 Percent Federal Match for State Funding in Excess of 
Required Maintenance of Effort Level.--Section 403(a) (42 U.S.C. 
603(a)), as amended by subsection (e)(1)(A) of this section, is amended 
by adding at the end the following:
            ``(5) Matching grants for state expenditures exceeding 
        required maintenance of effort level.--
                    ``(A) In general.--Each eligible State shall be 
                entitled to receive from the Secretary for a fiscal 
                year a grant in an amount equal to the amount (if any) 
                by which the total of the qualified State expenditures 
                (as defined in section 409(a)(7)(B)(i)) for the fiscal 
                year exceeds the applicable percentage (as defined in 
                section 409(a)(7)(B)(ii)) of historic State 
                expenditures (as defined in section 409(a)(7)(B)(iii)) 
                with respect to the fiscal year.
                    ``(B) Appropriation.--Out of any money in the 
                Treasury of the United States not otherwise 
                appropriated, there are appropriated such sums as are 
                necessary for grants under this section for fiscal 
                years 2002 through 2008.''.
    (g) Contingency Fund.--
            (1) In general.--Section 403(b) (42 U.S.C. 603(b)) is 
        amended by striking paragraphs (2) through (7) and inserting 
        the following:
            ``(2) Deposits into fund.--Out of any money in the Treasury 
        of the United States not otherwise appropriated, there are 
        appropriated for each of fiscal years 1997 through 2008 such 
        sums as are necessary for grants under this section for the 
        fiscal year.
            ``(3) Grants.--The Secretary shall make a grant to a needy 
        State, for each eligible month with respect to the State, in an 
        amount equal to the amount described in paragraph (6).
            ``(4) Needy state.--A State is a needy State for purposes 
        of this paragraph if--
                    ``(A) the rate of total unemployment in the State 
                (seasonally adjusted) for the most recent month for 
                which such information is available--
                            ``(i) is at least 5.5 percent; or
                            ``(ii) has increased by the lesser of 50 
                        percent, or 1.5 percentage points, over the 
                        lesser of the average rate of total 
                        unemployment in the State (seasonally adjusted) 
                        for the preceding fiscal year or such average 
                        rate for the 2nd preceding fiscal year; or
                    ``(B) the number of families participating in 
                eligible State programs is at least 10 percent greater 
                than the average monthly number of families who 
                participated in the programs during the 2 consecutive 
                calendar quarters of the then most recent 8 such 
                quarters in which such average monthly number was the 
                least.
            ``(5) Eligible month.--In paragraph (3), the term `eligible 
        month' means, with respect to a State, any month for which the 
        State is a needy State, and each subsequent month until--
                    ``(A) 3 months has elapsed since the end of the 
                most recent month in which the 3-month moving average 
                of the rate of total unemployment in the State 
                (seasonally adjusted) was less than the monthly 
                unemployment rate in the State in the most recent month 
                in which the State became (or, in the absence of 
                paragraph (4)(B), would have become) a needy State by 
                reason of paragraph (4)(A); and
                    ``(B) 4 months has elapsed since the end of the 
                most recent month in which the number of families 
                participating in eligible State programs was at least 
                as great as the number of families so participating in 
                the most recent month in which the State became (or, in 
                the absence of paragraph (4)(A), would have become) a 
                needy State by reason of paragraph (4)(B).
            ``(6) Grant amount.--The amount described in this paragraph 
        with respect to a State is an amount equal to 110 percent of--
                    ``(A) 80 percent of the average total amount 
                expended by the State under all eligible State programs 
                in the 2 consecutive calendar quarters of the then most 
                recent 8 such quarters in which the average monthly 
                number of families participating in the programs was 
                the least; multiplied by
                    ``(B) the percentage by which the monthly number of 
                families participating in eligible State programs has 
                increased over the average monthly number of families 
                so participating during the 2 consecutive quarters 
                referred to in subparagraph (A).
            ``(7) Eligible state program defined.--In this subsection, 
        the term `eligible State program' means, with respect to a 
        State, any program under which a State expenditure could be 
        considered a qualified State expenditure (as defined in section 
        409(a)(7)(B)(i)).''.
            (2) Easing of related maintenance of effort requirement.--
        Section 409(a)(10) (42 U.S.C. 609(a)(10)) is amended by 
        striking ``100 percent'' and inserting ``the applicable 
        percentage (as defined in paragraph (7)(B)(ii) of this 
        subsection)''.
    (h) Federal Loans for State Welfare Programs.--Section 406 (42 
U.S.C. 606) is amended--
            (1) in subsection (d), by striking ``10'' and inserting 
        ``20''; and
            (2) in subsection (e), by striking ``$1,700,000,000'' and 
        inserting ``$2,000,000,000''.
    (i) Grants for Indian Tribes.--Paragraphs (1)(A) and (2)(A) of 
section 412(a) (42 U.S.C. 612(a)(1)(A), (2)(A)) are each amended by 
striking ``1997, 1998, 1999, 2000, 2001, and 2002'' and inserting 
``1997 through 2008''.
    (j) Studies and Demonstrations.--Section 413(h)(1) (42 U.S.C. 
613(h)(1)) is amended by striking ``2002'' and inserting ``2008''.
    (k) Study by the Census Bureau.--Section 414(b) (42 U.S.C. 614(b)) 
is amended by striking ``1996, 1997, 1998, 1999, 2000, 2001, and 2002'' 
and inserting ``1996 through 2008''.

SEC. 104. USE OF FUNDS.

    (a) Elimination of Authority to Treat Interstate Immigrants Under 
Rules of Former State.--Section 404 (42 U.S.C. 604) is amended by 
striking subsection (c).
    (b) Modifications to Individual Development Accounts.--Section 
404(h) (42 U.S.C. 604(h)) is amended--
            (1) in paragraph (2), by striking subparagraph (C) and 
        redesignating subparagraph (D) as subparagraph (C);
            (2) in paragraph (5)(A), by adding at the end the 
        following:
                            ``(iii) An institution that offers a course 
                        of study leading to adult literacy, in English 
                        as a second language, or a certificate of high 
                        school equivalency.''; and
            (3) in paragraph (5)(F), by striking ``and inventory'' and 
        inserting ``inventory, and transportation''.
    (c) Conforming Amendments.--Section 404 (42 U.S.C. 404) is amended 
by striking subsections (i) and (j) and redesignating subsection (k) as 
subsection (i).

                      TITLE II--WORK REQUIREMENTS

SEC. 201. REDUCED WORK REQUIREMENT FOR PARENTS OF SCHOOL-AGE CHILDREN 
              WHO CANNOT FIND ADEQUATE CHILD CARE.

    Section 407(c)(1)(A) (42 U.S.C. 607(c)(1)(A)) is amended by adding 
at the end the following:
                ``Notwithstanding the preceding sentence, the maximum 
                average number of hours per week shall be 20 for any 
                week in which the recipient is the parent or caretaker 
                relative of a child who has attained 6 years of age and 
                does not have meaningful access to safe, appropriate, 
                affordable, and quality after-school or summer care for 
                the child.''.

SEC. 202. CONFORMING THE NUMBER OF WEEKS TO THE UNEMPLOYMENT INSURANCE 
              COMPENSATION STANDARD.

    Section 407(c)(2)(A)(i) (42 U.S.C. 607(c)(2)(A)(i)) is amended by 
striking ``6 weeks'' and inserting ``12 weeks''.

SEC. 203. REVISION OF WORK ACTIVITIES.

    (a) In General.--Section 407(d) (42 U.S.C. 607(d)) is amended--
            (1) by striking paragraph (4) and inserting the following:
            ``(4) transitional work experience leading to jobs that 
        provide an income of not less than 250 percent of the poverty 
        line;'';
            (2) by striking paragraph (7) and inserting the following:
            ``(7) voluntary participation in a community service 
        program;'';
            (3) in paragraph (8), by striking ``(not to exceed 12 
        months with respect to any individual)''; and
            (4) by striking paragraphs (10) through (12) and inserting 
        the following:
            ``(10) participation in a State or Federal work-study 
        program under part C of title IV of the Higher Education Act of 
        1965;'';
            ``(11) education, including not more than 6 hours of home 
        study per week, in the case of a recipient who is enrolled--
                    ``(A) at an elementary or secondary school (as 
                defined in the Elementary and Secondary Education Act 
                of 1965);
                    ``(B) in a course of study leading to adult 
                literacy, English as a second language, or a 
                certificate of high school equivalency; or
                    ``(C) at an institution of higher education (as 
                defined in section 102 of the Higher Education Act of 
                1965), regardless of the content of the course of 
                study;
            ``(12) the provision of appropriate care to a child who has 
        a disability or a serious health condition (as defined in 
        section 101(11) of the Family Medical Leave Act) or has not 
        attained 6 years of age, by a recipient who is a parent or 
        caretaker relative of the child; and
            ``(13) participation in treatment or an educational 
        activity designed to address a mental health problem, 
        disability, substance abuse, or domestic or sexual violence.''.
    (b) Conforming Amendments.--Section 407 of such Act (42 U.S.C. 607) 
is amended--
            (1) in subsection (b), by striking paragraph (5); and
            (2) in subsection (c)--
                    (A) in each of subparagraphs (A) and (B)(i) of 
                paragraph (1), by striking ``not fewer than'' and all 
                that follows through ``subsection (d),'';
                    (B) in paragraph (1)(B)(ii), by striking ``not 
                fewer than'' and all that follows through ``subsection 
                (d)''; and
                    (C) in paragraph (2), by striking subparagraph (D).

SEC. 204. PENALTIES AGAINST INDIVIDUALS FOR UNJUSTIFIED REFUSAL TO 
              WORK; ADDITIONAL JUSTIFICATIONS.

    (a) In General.--Section 407(e) (42 U.S.C. 607(e)) is amended--
            (1) by striking paragraph (1) and inserting the following:
            ``(1) In general.--Except as otherwise provided in this 
        subsection, if an individual in a family receiving assistance 
        under the State program funded under this part refuses to 
        engage in work required in accordance with this section, the 
        State shall, subject to such good cause and other exceptions as 
        the State may establish, reduce the amount of assistance 
        otherwise payable to the family on a pro rata basis, but to not 
        less than the amount that would be payable to a family with the 
        same number of children but with no adults, with respect to any 
        period during a month in which the individual so refuses.'';
            (2) in paragraph (2)--
                    (A) by striking ``Exception'' and inserting ``Child 
                care exception''; and
                    (B) by striking ``proves that the individual has a 
                demonstrated inability (as determined by the State)'' 
                and inserting ``certifies that the individual is 
                unable''; and
            (3) by adding at the end the following:
            ``(3) Additional child care exceptions.--Notwithstanding 
        paragraph (1), a State may not reduce or terminate assistance 
        under the State program funded under this part based on a 
        refusal of an individual to engage in work required in 
        accordance with this section if the individual is a custodial 
        parent or caretaker relative caring for--
                    ``(A) a child who has a disability or a serious 
                health condition (as defined in section 101(11) of the 
                Family Medical Leave Act), and the individual does not 
                have meaningful access to safe, appropriate, 
                affordable, and quality care for the child; or
                    ``(B) a child who has attained 6 years of age, and 
                the individual does not have meaningful access to safe, 
                appropriate, affordable, and quality after-school or 
                summer care for the child.
            ``(4) Mental health problem, disability, substance abuse, 
        or domestic or sexual violence exception.--Notwithstanding 
        paragraph (1), a State may not reduce or terminate assistance 
        under the State program funded under this part based on the 
        failure of any individual who has a mental health problem, 
        disability, or substance abuse problem, or who is a victim of 
        sexual or domestic violence to engage in work required in 
        accordance with this section if--
                    ``(A) the individual is in the process of being 
                screened or assessed for the mental health problem, 
                disability, substance abuse problem, or sexual or 
                domestic violence situation but the screening or 
                assessment has not been completed;
                    ``(B) the individual has not been offered treatment 
                to address the problem or disability; or
                    ``(C) the individual cannot comply because of the 
                need to seek medical, legal, or other services in 
                relation to the mental health problem, disability, or 
                sexual or domestic violence situation.
            ``(5) Minimum wage exception.--Notwithstanding paragraph 
        (1), a State may not impose a sanction under the State program 
        funded under this part on the basis of the refusal of an 
        individual to accept any employment (including any employment 
        offered under the program), if the wage rate for the employment 
        does not equal or exceed the greater of--
                    ``(A) the minimum wage rate then in effect under 
                section 6 of the Fair Labor Standards Act of 1938; or
                    ``(B) any minimum wage rate prescribed by or under 
                the law of the State.
            ``(6) Discrimination exception.--
                    ``(A) In general.--Notwithstanding paragraph (1), a 
                State may not reduce or terminate assistance under the 
                State program funded under this part based on the 
                failure of any individual to engage in work required in 
                accordance with this section if the individual 
                certifies in a manner described in subparagraph (B) 
                that the individual has left or refused work based on 
                discrimination.
                    ``(B) Certification.--An individual may provide a 
                certification required by subparagraph (A) by sworn 
                written statement or by providing other documentation, 
                including a police or court record or documentation by 
                a shelter worker, an employee of a victim assistance 
                program, an attorney, a member of the clergy, or a 
                medical or other professional from whom the individual 
                has sought assistance as a victim.''.
    (b) Conforming Amendments.--Section 409(a)(11) (42 U.S.C 
609(a)(11)) is amended--
            (1) in the paragraph heading, by striking ``who cannot 
        obtain child care for child under age 6'' and inserting ``with 
        justified refusal to work''; and
            (2) in subparagraph (A), by striking ``407(e)(2)'' and 
        inserting ``407(e)''.

SEC. 205. ELIMINATION OF MISCELLANEOUS PROVISIONS.

    Section 407 (42 U.S.C. 607) is amended by striking subsections (g), 
(h), and (i).

SEC. 206. ASSESSMENT OF INDIVIDUALS FOR JOB PREPARATION.

    Section 407 (42 U.S.C. 607), as amended by section 205 of this Act, 
is amended by adding at the end the following:
    ``(g) Assessment of Individuals for Job Preparation.--At the option 
of a recipient of assistance under a State program funded under this 
part, the State shall, before assigning the recipient to a work 
activity under the program, perform an individual assessment for the 
preparation that is needed for the recipient to obtain and maintain a 
job at a monthly wage that is at least 200 percent of the poverty line 
applicable to the family of the recipient.''.

                 TITLE III--PROHIBITIONS; REQUIREMENTS

SEC. 301. REPLACEMENT OF REQUIREMENT TO SANCTION INDIVIDUAL FOR 
              NONCOOPERATION IN ESTABLISHING PATERNITY OR OBTAINING 
              CHILD SUPPORT WITH PROHIBITION ON REQUIRING SUCH 
              COOPERATION.

    (a) In General.--Section 408(a)(2) (42 U.S.C. 608(a)(2)) is amended 
to read as follows:
            ``(2) Prohibition on requiring cooperation in establishing 
        paternity or obtaining child support.--A State to which a grant 
        is made under section 403 shall not penalize an individual 
        under the State program funded under this part by reason of the 
        failure of the individual to cooperate in establishing 
        paternity or establishing, modifying, or enforcing a child 
        support order with respect to a child of the recipient.''.
    (b) Conforming Amendments.--Section 454(29) (42 U.S.C. 654(29)) is 
amended--
            (1) by striking ``the State program funded under part A,'' 
        each place it appears; and
            (2) in subparagraph (A)(i), by striking ``E,'' and 
        inserting ``E''.

SEC. 302. PROHIBITION ON REQUIRING ASSIGNMENT OF SUPPORT RIGHTS TO THE 
              STATE; RETURN OF SUPPORT RIGHTS ASSIGNED TO THE STATE.

    (a) In General.--Section 408(a)(3) (42 U.S.C. 608(a)(3)) is amended 
to read as follows:
            ``(3) Prohibition on requiring assignment of support rights 
        to the state; requirement to return support rights assigned to 
        the state.--A State to which a grant is made under section 403 
        shall not penalize an individual or family  under the State 
program funded under this part by reason of the failure of the 
individual to assign to the State any rights any person may have (on 
behalf of the person or of any other person for whom the individual has 
applied for or is receiving assistance) to support from any other 
person. If any person has assigned any such rights to the State, the 
State shall assign such rights back to the person.''.
    (b) Conforming Amendments.--
            (1) Section 452 (42 U.S.C. 652) is amended--
                    (A) in subsection (a)(10)(C), by striking 
                ``pursuant to section 408(a)(3) or''; and
                    (B) in subsection (h), by striking ``or with 
                respect to whom an assignment pursuant to section 
                408(a)(3) is in effect''.
            (2) Section 454(5) (42 U.S.C. 654(5)) is amended by 
        striking ``(A)'' and all that follows through ``(B)''.
            (3) Section 456(a)(1) (42 U.S.C. 656(a)(1)) is amended by 
        striking ``assigned to the State pursuant to section 408(a)(3) 
        or''.
            (4) Section 464(a)(1) (42 U.S.C. 664(a)(1)) is amended by 
        striking ``section 408(a)(3) or''.
            (5) Section 466(a)(3)(B) (42 U.S.C. 666(a)(3)(B)) is 
        amended by striking ``section 408(a)(3) or''.

SEC. 303. ELIMINATION OF SANCTION AGAINST TEENAGE PARENTS NOT ATTENDING 
              HIGH SCHOOL OR OTHER EQUIVALENT TRAINING PROGRAM.

    Section 408(a) (42 U.S.C. 608(a)) is amended by striking paragraph 
(4).

SEC. 304. REQUIREMENTS RELATING TO DISREGARD OF CHILD SUPPORT.

    (a) In General.--Section 408(a) (42 U.S.C. 608(a)), as amended by 
section 303 of this Act, is amended by inserting after paragraph (3) 
the following:
            ``(4) Limited disregard of child support.--In determining 
        the amount and type of assistance for which a family is 
        eligible under the State program funded under this part, a 
        State to which a grant is made under section 403 shall 
        disregard--
                    ``(A) the first $200 (or, if the family includes 2 
                or more children, $400) per month distributed to any 
                family member by the State under section 457; and
                    ``(B) all child support (as defined in section 
                459(i)(2)) received by any family member from any other 
                source.''.
    (b) Requirement To Pass Through All Child Support.--
            (1) In general.--Section 457 (42 U.S.C. 657) is amended to 
        read as follows:

``SEC. 457. DISTRIBUTION OF COLLECTED CHILD SUPPORT.

    ``(a) In General.--Except as provided in subsection (b), all 
amounts collected on behalf of a family as support by a State pursuant 
to a plan approved under this part shall be distributed to the family.
    ``(b) Exception.--In the case of an amount collected for a family 
in accordance with a cooperative agreement under section 454(33), the 
State shall distribute the amount pursuant to the agreement.''.
            (2) Conforming amendments.--
                    (A) Section 409(a)(7)(B)(i)(I)(aa) (42 U.S.C. 
                609(a)(7)(B)(i)(I)(aa)) is amended by striking 
                ``457(a)(1)(B)'' and inserting ``457''.
                    (B) Section 454B(c)(1) (42 U.S.C. 654b(c)(1)) is 
                amended by striking ``457(a)'' and inserting ``457''.

SEC. 305. ELIMINATION OF SANCTION AGAINST TEENAGE PARENTS NOT LIVING IN 
              ADULT-SUPERVISED SETTINGS.

    Section 408(a) (42 U.S.C. 608(a)) is amended by striking paragraph 
(5).

SEC. 306. PROTECTION FOR CHILDREN BORN INTO POVERTY.

    Section 408(a) (42 U.S.C. 608(a)), as amended by section 305 of 
this Act, is amended by inserting after paragraph (4) the following:
            ``(5) Protection for children.--A State to which a grant is 
        made under section 403 shall not deny or limit assistance to a 
        child born into a family receiving assistance under the State 
        program funded under this part.''.

SEC. 307. 5-YEAR TIME LIMIT.

    (a) Removal of Limitations.--
            (1) Elimination of limitation on hardship exception.--
        Section 408(a)(7)(C) (42 U.S.C. 608(a)(7)(C)) is amended by 
        striking clause (ii) and redesignating clause (iii) as clause 
        (ii).
            (2) Compliance exception.--Section 408(a)(7) (42 U.S.C. 
        608(a)(7)) is amended by adding at the end the following:
                    ``(H) Compliance exception.--In determining the 
                number of months for which an individual has received 
                assistance under the State program funded under this 
                part, the State shall disregard any month throughout 
                which the individual is in compliance with all 
                applicable requirements of the State program.''.
    (b) Uniform Duration of Assistance.--Section 408(a)(7)(E) (42 
U.S.C. 608(a)(7)(E)) is amended to read as follows:
                    ``(E) Requirement to provide assistance for 5 
                years.--Notwithstanding section 407(e), a State to 
                which a grant is made under section 403 shall not 
                impose a limitation of fewer than 60 months on the 
                period for which a recipient is eligible for assistance 
                under the State program funded under this part.''.
    (c) Protection Against Recession.--Section 408(a)(7) (42 U.S.C. 
608(a)(7)), as amended by subsection (a)(2) of this section, is amended 
by adding at the end the following:
                    ``(I) Special rules relating to month in which 
                unemployment is high or has increased sharply over 
                prior 2 years.--
                            ``(i) Clock stopped for current 
                        recipients.--In determining the number of 
                        months for which an individual has received 
                        assistance under the State program funded under 
                        this part, the State shall disregard any month 
                        that is a trigger month.
                            ``(ii) Treatment of former recipients who 
                        reached time limit.--
                                    ``(I) Notice; determination of 
                                eligibility.--On the occurrence of a 
                                trigger month, the State shall--
                                            ``(aa) issue a public 
                                        notice that a trigger month has 
                                        occurred; and
                                            ``(bb) on request of an 
                                        individual who had become 
                                        ineligible for assistance under 
                                        the State program funded under 
                                        this part by reason of this 
                                        paragraph, determine the 
                                        eligibility of the individual 
                                        for such assistance as if the 
                                        individual had received such 
                                        assistance for 59 months.
                                    ``(II) Additional month of 
                                assistance for otherwise eligible 
                                former recipients.--If the individual 
                                is so determined to be eligible for 
                                such assistance, the State shall,  
notwithstanding subparagraph (A), provide such assistance to the 
individual for any month that is a trigger month, but shall not provide 
such assistance to the individual for any month that is not a trigger 
month.
                            ``(iii) Trigger month.--In this 
                        subparagraph, the term `trigger month' means, 
                        with respect to a State, any month for which 
                        the unemployment rate of the State--
                                    ``(I) is at least 5.5 percent; or
                                    ``(II) has increased by the lesser 
                                of 50 percent, or 1.5 percentage 
                                points, over the lesser of the average 
                                rate of total unemployment in the State 
                                (seasonally adjusted) for the preceding 
                                fiscal year or the average unemployment 
                                rate of the State for the 2nd preceding 
                                fiscal year.''.

SEC. 308. REQUIREMENT TO PROVIDE NOTICE OF RIGHTS OF RECIPIENTS, AND 
              TRAIN PROGRAM PERSONNEL IN CARRYING OUT PROGRAM 
              CONSISTENT WITH THE RIGHTS.

    Section 408(a) (42 U.S.C. 608(a)) is amended by adding at the end 
the following:
            ``(12) Requirement to provide notice of rights of 
        recipients, and train program personnel to carry out program 
        consistent with the rights.--A State to which a grant is made 
        under section 403 shall--
                    ``(A) notify each recipient of assistance under the 
                program of the rights of recipients under all laws 
                applicable to the activities of the State program 
                funded under this part, and shall provide the notice--
                            ``(i) to a recipient when the recipient 
                        enters the program;
                            ``(ii) to all such recipients on a 
                        semiannual basis; and
                            ``(iii) orally and in writing, in the 
                        native language of the recipient and at a 6th 
                        grade level, and if the native language is not 
                        English, a culturally competent translation 
                        shall be provided; and
                    ``(B) train all program personnel on a regular 
                basis in how to carry out the program consistent with 
                the rights.''.

SEC. 309. REQUIREMENT TO PROVIDE INFORMATION TO INDIVIDUALS WHO ARE, OR 
              ARE AT RISK OF BEING, SANCTIONED.

    Section 408(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(13) State required to provide information to individual 
        who has been, or is at risk of being sanctioned.--A State to 
        which a grant is made under section 403 shall provide to any 
        individual who has been, or is at risk of being, sanctioned 
        under the State program funded under this part, orally and in 
        writing, at not more than a 6th grade level in the native 
        language of the individual (and if the native language is not 
        English, a culturally competent translation shall be provided), 
        that--
                    ``(A) program requirements may be waived for people 
                dealing with a mental health, disability, substance 
                abuse, domestic violence, or sexual assault issue;
                    ``(B) an individual dealing with a mental health, 
                disability, substance abuse, domestic violence, or 
                sexual assault issue may request (or if the individual 
                has left or been removed from the program, may return 
                to the program and request) to be assessed under the 
                program for services to address those issues, including 
                appropriate treatment, counseling, vocational 
                rehabilitation, job training, or other services; and
                    ``(C) the State is required to keep any such 
                information strictly confidential.''.

SEC. 310. BAN ON COUNTING INCOME, SCHOLARSHIP, OR GIFT RECEIVED BY 
              DEPENDENT MINORS.

    Section 408(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(14) Prohibition on counting income, scholarship, or gift 
        received by dependent minor.--In determining the eligibility of 
        a family for, and the amount and type of assistance to be 
        provided to a family under, a State program funded under this 
        part, the State shall disregard any income, scholarship, or 
        gift received by a dependent minor child in the family.''.

SEC. 311. BAN ON DIVERSION OF POTENTIAL APPLICANTS FOR ASSISTANCE.

    Section 408(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(15) Ban on diversion of potential applicants for 
        assistance.--A State may not refuse to accept, at the time of 
        application, an application for assistance from the State 
        program funded under this part, or give an individual reason to 
        believe that, at the time of application, the State will not 
        unconditionally accept such an application from any 
        individual.''.

SEC. 312. PROHIBITION ON REQUIRING RECIPIENTS TO RESPOND TO SURVEYS 
              CONDUCTED TO OBTAIN INFORMATION FOR QUARTERLY REPORTS.

    Section 408(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(16) Prohibition on requiring recipients to respond to 
        surveys conducted to obtain information for quarterly 
        reports.--A State to which a grant is made under section 403 
        shall not penalize an individual under the State program funded 
        under this part by reason of the failure of the individual to 
        respond to a survey conducted to obtain information for use in 
        a report required by section 411(a).''.

SEC. 313. CONFIDENTIALITY OF PROGRAM INFORMATION.

    Section 408(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(17) Confidentiality of program information.--A State to 
        which a grant is made under section 403 shall ensure that any 
        information provided by an individual to a State officer or 
        employee for use by the State program funded under this part 
        shall not be disclosed to any other person, except to the 
        extent that the disclosure is necessary to administer the 
        program or is consented to by the individual.''.

SEC. 314. NONDISCRIMINATION.

    Section 408(a) (42 U.S.C. 608(a) is amended by adding at the end 
the following:
            ``(18) Nondiscrimination.--A State to which a grant is made 
        under section 403 shall ensure equitable treatment of needy 
        families in the State, and shall not discriminate among 
        families based on marital status or applicant or recipient 
        status.''.

SEC. 315. REQUIREMENT TO PROVIDE OPPORTUNITY TO APPEAL ADVERSE 
              DECISION.

    Section 408(a) (42 U.S.C. 608(a) is amended by adding at the end 
the following:
            ``(19) Requirement to provide opportunity to appeal adverse 
        decision.--A State to which a grant is made under section 403 
        shall provide a recipient of assistance under the State program 
        funded under this part with the opportunity to appeal any 
        adverse decision made with respect to the recipient under the 
        program.''.

SEC. 316. CLARIFICATION OF PENALTY FOR FAILURE TO COMPLY WITH 
              INDIVIDUAL RESPONSIBILITY PLAN.

    Section 408(b)(3) (42 U.S.C. 608(b)(3)) is amended by striking ``a 
family that includes''.

SEC. 317. APPLICABILITY OF CIVIL RIGHTS LAWS.

    Section 408(d) (42 U.S.C. 608(d)) is amended--
            (1) in paragraph (3), by inserting ``, or any provision of 
        State law relating to individuals with physical or mental 
        disabilities'' before the 2nd period; and
            (2) by adding at the end the following:
            ``(5) Title VII of the Civil Rights Act of 1964 (42 U.S.C. 
        2000e et seq.), or any provision of State law relating to 
        discrimination on the basis of race, color, national origin, 
        religion, gender, sex, parental or marital status, or sexual 
        orientation.
            ``(6) The Age Discrimination in Employment Act of 1967 (29 
        U.S.C. 621-634), or any provision of State law relating to age 
        discrimination.
            ``(7) Title IX of the Education Amendments of 1972 (20 
        U.S.C. 1681 et seq.), or any provision of State law relating to 
        discrimination in education.
            ``(8) The Fair Labor Standards Act of 1938 (29 U.S.C. 201 
        et seq.), or any provision of State law relating to labor or to 
        a term or condition of employment.
            ``(9) The Occupational Safety and Health Act of 1970 (29 
        U.S.C. 651 et seq).
            ``(10) The National Labor Relations Act (29 U.S.C. 151 et 
        seq.).
            ``(11) The Railway Labor Act (45 U.S.C. 151 et seq.).
            ``(12) Any Federal law providing employee protections 
        against discrimination for union activity.
            ``(13) Any other provision of Federal or State law the 
        purpose of which is to provide or protect a civil right.''.

SEC. 318. ELIMINATION OF SPECIAL RULES RELATING TO TREATMENT OF ALIENS.

    (a) Amendments to the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996.--
            (1) Section 401(c)(2) of the Personal Responsibility and 
        Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 
        1611(c)(2)) is amended--
                    (A) by striking ``or'' at the end of subparagraph 
                (B);
                    (B) by striking the period at the end and inserting 
                ``; or''; and
                    (C) by adding at the end the following:
                    ``(D) to any assistance provided under a State 
                program funded under the program of block grants to 
                States for temporary assistance for needy families 
                under part A of title IV of the Social Security Act.''.
            (2)(A) Section 402(b)(3) of such Act (8 U.S.C. 1612(b)(3)) 
        is amended by striking subparagraph (A) and redesignating 
        subparagraphs (B) and (C) as subparagraphs (A) and (B), 
        respectively.
            (B) Section 402(b)(2)(A)(ii) of such Act (8 U.S.C. 
        1612(b)(2)(A)(ii)) is amended by striking ``(C)'' and inserting 
        ``(B)''.
            (3) Section 403(c)(2) of such Act (8 U.S.C. 1613(c)(2)) is 
        amended by adding at the end the following:
                    ``(L) Assistance under a State program funded under 
                the program of block grants to  States for temporary 
assistance for needy families under part A of title IV of the Social 
Security Act.''.
            (4) Section 423(d) of such Act (8 U.S.C. 1138a note) is 
        amended by adding at the end the following:
            ``(12) Assistance under a State program funded under the 
        program of block grants to States for temporary assistance for 
        needy families under part A of title IV of the Social Security 
        Act.''.
    (b) Conforming Amendments.--
            (1) Section 408 (42 U.S.C. 608) is amended by striking 
        subsections (e) and (f) and by redesignating subsection (g) as 
        subsection (e).
            (2) Section 409(a)(7)(B)(i)(IV) (42 U.S.C. 
        609(a)(7)(B)(i)(IV)) is amended--
                    (A) by striking ``part,'' and inserting ``part 
                and''; and
                    (B) by striking ``, and families of aliens lawfully 
                present in the United States that would be eligible for 
                such assistance but for the application of title IV of 
                the Personal Responsibility and Work Opportunity 
                Reconciliation Act of 1996''.

                          TITLE IV--PENALTIES

SEC. 401. INCREASE IN PENALTY FOR FAILURE TO SUBMIT REQUIRED REPORT.

    Section 409(a)(2)(A) (42 U.S.C. 609(a)(2)(A)) is amended by 
striking ``4'' and inserting ``5''.

SEC. 402. REPLACEMENT OF PENALTY AGAINST STATE FOR FAILURE TO COMPLY 
              WITH PATERNITY ESTABLISHMENT AND CHILD SUPPORT 
              ENFORCEMENT REQUIREMENTS WITH PENALTY FOR REQUIRING 
              COOPERATION IN ESTABLISHING PATERNITY OR OBTAINING CHILD 
              SUPPORT (INCLUDING ASSIGNING SUPPORT RIGHTS TO THE STATE) 
              OR FAILING TO RETURN SUPPORT RIGHTS ASSIGNED TO THE 
              STATE.

    Section 409(a)(5) (42 U.S.C. 609(a)(5)) is amended to read as 
follows:
            ``(5) Penalty for requiring cooperation in establishing 
        paternity or obtaining child support (including assigning 
        support rights to the state) or failing to return support 
        rights assigned to the state.--If the Secretary determines that 
        a State to which a grant is made under section 403 for a fiscal 
        year has violated paragraph (2) or (3) of section 408(a) during 
        the fiscal year, the Secretary shall reduce the grant payable 
        to the State under section 403(a)(1) for the immediately 
        succeeding fiscal year by an amount equal to 5 percent of the 
        State family assistance grant.''.

SEC. 403. EXTENSION OF MAINTENANCE OF EFFORT REQUIREMENT.

    Section 409(a)(7)(A) (42 U.S.C. 609(a)(7)(A)) is amended by 
striking ``or 2003'' and inserting ``2003, 2004, 2005, 2006, 2007, or 
2008''.

SEC. 404. PENALTY FOR FAILURE OF STATE TO COMPLY WITH CHILD SUPPORT 
              DISREGARD REQUIREMENTS.

    Section 409(a) (42 U.S.C. 609(a)) is amended by adding at the end 
the following:
            ``(15) Penalty for failure to comply with child support 
        disregard requirements.--If the Secretary determines that a 
        State to which a grant is made under section 403 for a fiscal 
        year has violated section 408(a)(4) during the fiscal year, the 
        Secretary shall reduce the grant payable to the State under 
        section 403(a)(1) for the immediately succeeding fiscal year by 
        an amount equal to 5 percent of the State family assistance 
        grant.''.

SEC. 405. PENALTY FOR PENALIZING BIRTH OF CHILD.

    Section 409(a) (42 U.S.C. 609(a)) is further amended by adding at 
the end the following:
            ``(16) Penalty for penalizing birth of child.--If the 
        Secretary determines that a State to which a grant is made 
        under section 403 for a fiscal year has violated section 
        408(a)(5) during the fiscal year, the Secretary shall reduce 
        the grant payable to the State under section 403(a)(1) for the 
        immediately succeeding fiscal year by an amount equal to 5 
        percent of the State family assistance grant.''.

SEC. 406. PENALTY FOR FAILURE TO NOTIFY RECIPIENTS OF RIGHTS, OR TRAIN 
              PROGRAM PERSONNEL IN RESPECTING RIGHTS OF RECIPIENTS.

    Section 409(a) (42 U.S.C. 609(a)) is further amended by adding at 
the end the following:
            ``(17) Penalty for failure to notify recipients of rights, 
        or train program personnel in respecting rights of 
        recipients.--If the Secretary determines that a State to which 
        a grant is made under section 403 for a fiscal year has 
        violated section 408(a)(12) during the fiscal year, the 
        Secretary shall reduce the grant payable to the State under 
        section 403(a)(1) for the immediately succeeding fiscal year by 
        an amount equal to 5 percent of the State family assistance 
        grant.''.

SEC. 407. PENALTY FOR FAILURE TO PROVIDE INFORMATION TO INDIVIDUALS WHO 
              ARE, OR ARE AT RISK OF BEING, SANCTIONED.

    Section 409(a) (42 U.S.C. 609(a)) is further amended by adding at 
the end the following:
            ``(18) Penalty for failure to provide information to 
        individual who has been, or is at risk of being sanctioned.--If 
        the Secretary determines that a State to which a grant is made 
        under section 403 for a fiscal year has violated section 
        408(a)(13) during the fiscal year, the Secretary shall reduce 
        the grant payable to the State under section 403(a)(1) for the 
        immediately succeeding fiscal year by an amount equal to 5 
        percent of the State family assistance grant.''.

SEC. 408. PENALTY FOR COUNTING INCOME, SCHOLARSHIP, OR GIFT RECEIVED BY 
              DEPENDENT MINOR.

    Section 409(a) (42 U.S.C. 608(a)) is amended by adding at the end 
the following:
            ``(19) Penalty for counting income, scholarship, or gift 
        received by dependent minor.--If the Secretary determines that 
        a State to which a grant is made under section 403 for a fiscal 
        year has violated section 408(a)(14) during the fiscal year, 
        the Secretary shall reduce the grant payable to the State under 
        section 403(a)(1) for the immediately succeeding fiscal year by 
        an amount equal to 5 percent of the State family assistance 
        grant.''.

SEC. 409. PENALTY FOR DIVERTING POTENTIAL APPLICANT FOR ASSISTANCE.

    Section 409(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(20) Penalty for diverting potential applicant for 
        assistance.--If the Secretary determines that a State to which 
        a grant is made under section 403 for a fiscal year has 
        violated section 408(a)(15) during the fiscal year, the 
        Secretary shall reduce the grant payable to the State under 
        section 403(a)(1) for the immediately succeeding fiscal year by 
        an amount equal to 5 percent of the State family assistance 
        grant.''.

SEC. 410. PENALTY FOR REQUIRING RECIPIENT TO RESPOND TO SURVEY 
              CONDUCTED TO OBTAIN INFORMATION FOR QUARTERLY REPORT.

    Section 409(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(21) Penalty for requiring recipient to respond to survey 
        conducted to obtain information for quarterly report.--If the 
        Secretary determines that a State to which a grant is made 
        under section 403 for a fiscal year has violated section 
        408(a)(16) during the fiscal year, the Secretary shall reduce 
        the grant payable to the State under section 403(a)(1) for the 
        immediately succeeding fiscal year by an amount equal to 5 
        percent of the State family assistance grant.''.

SEC. 411. PENALTY FOR UNAUTHORIZED DISCLOSURE OF INFORMATION PROVIDED 
              BY RECIPIENT.

    Section 409(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(22) Penalty for unauthorized disclosure of information 
        provided by recipient.--If the Secretary determines that a 
        State to which a grant is made under section 403 for a fiscal 
        year has violated section 408(a)(17) during the fiscal year, 
        the Secretary shall reduce the grant payable to the State under 
        section 403(a)(1) for the immediately succeeding fiscal year by 
        an amount equal to 5 percent of the State family assistance 
        grant.''.

SEC. 412. PENALTY FOR DISCRIMINATION.

    Section 409(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(23) Penalty for discrimination.--If the Secretary 
        determines that a State to which a grant is made under section 
        403 for a fiscal year has violated section 408(a)(18) during 
        the fiscal year, the  Secretary shall reduce the grant payable 
to the State under section 403(a)(1) for the immediately succeeding 
fiscal year by an amount equal to 5 percent of the State family 
assistance grant.''.

SEC. 413. PENALTY FOR FAILURE TO PROVIDE OPPORTUNITY TO APPEAL ADVERSE 
              DECISION.

    Section 409(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(24) Penalty for failure to provide opportunity to appeal 
        adverse decision.--If the Secretary determines that a State to 
        which a grant is made under section 403 for a fiscal year has 
        violated section 408(a)(19) during the fiscal year, the 
        Secretary shall reduce the grant payable to the State under 
        section 403(a)(1) for the immediately succeeding fiscal year by 
        an amount equal to 5 percent of the State family assistance 
        grant.''.

SEC. 414. PENALTY FOR FAILURE TO COMPLY WITH MINIMUM BENEFIT RULES.

    Section 409(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(25) Penalty for failure to comply with minimum benefit 
        rules.--If the Secretary determines that a State to which a 
        grant is made under section 403 for a fiscal year has violated 
        section 417 during the fiscal year, the Secretary shall reduce 
        the grant payable to the State under section 403(a)(1) for the 
        immediately succeeding fiscal year by an amount equal to 5 
        percent of the State family assistance grant.''.

SEC. 415. PENALTY FOR FAILURE TO PROVIDE INDIVIDUAL CHILD CARE 
              ENTITLEMENT.

    Section 409(a) (42 U.S.C. 608(a)) is further amended by adding at 
the end the following:
            ``(26) Penalty for failure to provide individual child care 
        entitlement.--Effective January 1, 2005, if the Secretary 
        determines that a State to which a grant is made under section 
        403 for a fiscal year has violated section 418(b) during the 
        fiscal year, the Secretary shall reduce the grant payable to 
        the State under section 403(a)(1) for the immediately 
        succeeding fiscal year by an amount equal to 5 percent of the 
        State family assistance grant.''.

SEC. 416. FAILURE TO SUBMIT REPORT ON WELFARE ACCESS AND OUTCOMES.

    Section 409(a) (42 U.S.C. 609(a)) is further amended by adding at 
the end the following:
            ``(27) Failure to submit report on welfare access and 
        outcomes.--If the Secretary determines that a State has not, 
        within 45 days after the end of a fiscal year, submitted the 
        report required by section 411(c) for the fiscal year, the 
        Secretary shall reduce the grant payable to the State under 
        section 403(a)(1) for the immediately succeeding fiscal year by 
        an amount equal to 5 percent of the State family assistance 
        grant.''.

SEC. 417. ELIMINATION OF REASONABLE CAUSE EXCEPTION.

    Section 409 (42 U.S.C. 609) is amended by striking subsection (b).

SEC. 418. MODIFICATION OF AVAILABILITY OF CORRECTIVE COMPLIANCE PLAN 
              OPTION.

    Section 409(c)(4) (42 U.S.C. 609(c)(4)) is amended to read as 
follows:
            ``(4) Limitation on opportunity to submit corrective 
        compliance plan.--The preceding provisions of this subsection 
        shall not apply with respect to a violation of a provision of 
        this part by a State if the State has violated the provision on 
        2 or more prior occasions.''.

SEC. 419. REPEAL OF BAN ON ASSISTANCE FOR PERSONS CONVICTED OF A DRUG 
              FELONY.

    Section 115 of the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996 (42 U.S.C. 862a) is repealed.

                      TITLE V--STUDIES AND REPORTS

SEC. 501. ADDITIONAL INFORMATION TO BE INCLUDED IN QUARTERLY STATE 
              REPORTS.

    Section 411(a) (42 U.S.C. 611(a)) is amended--
            (1) in paragraph (1)(A)--
                    (A) in each of clauses (vii) and (viii) by striking 
                ``race' and inserting ``race, gender,'';
                    (B) in clause (xi)(I), by inserting ``, broken down 
                by education level'';
                    (C) by striking clause (xvi) and redesignating 
                clause (xvii) and clause (xvi); and
                    (D) by adding at the end the following:
                            ``(xvii) The amount (if any) of child 
                        support collected on behalf of any individual 
                        in the family, the amount (if any) of any such 
                        collected support that has been distributed to 
                        any such individual, and the amount (if any) of 
                        such distributed support that has been 
                        disregarded pursuant to section 408(a)(4).
                            ``(xviii) The number of families receiving 
                        child care assistance under section 418.
                            ``(xix) With respect to sanctions imposed 
                        under the program, the following information 
                        broken down by race and gender:
                                    ``(I) The number of families 
                                against whom a sanction is in effect.
                                    ``(II) The number of times 
                                sanctions have been imposed.
                                    ``(III) The reasons for imposition 
                                of sanctions.
                                    ``(IV) The percentage of sanction 
                                determinations that have been reviewed.
                                    ``(V) The percentage of reviewed 
                                sanction determinations that have been 
                                reversed.
                                    ``(VI) The number of families 
                                leaving the program as a result of 
                                sanctions.
                            ``(xx) The number of families who have 
                        returned to the program after having left the 
                        program, and the length of the intervening 
                        period.
                            ``(xxi) The percentage of families who 
                        report having been notified of the option to be 
                        assessed for and receive services to manage a 
                        barrier to escaping poverty.''; and
            (2) by redesignating paragraph (7) as paragraph (8) and 
        inserting after paragraph (6) the following:
            ``(7) Report on training.--The report required by paragraph 
        (1) for a fiscal quarter shall include a statement of the 
        percentage of caseworkers, supervisors, and new employees who 
        received training to carry out the State program funded under 
        this part during the quarter.''.

SEC. 502. ELIMINATION FROM SECRETARIAL REPORT TO THE CONGRESS OF 
              INFORMATION ON OUT-OF-WEDLOCK PREGNANCIES.

    Section 411(b)(1)(B)(ii) (42 U.S.C. 611(b)(1)(B)(ii)) is amended by 
striking ``out-of-wedlock pregnancies and''.

SEC. 503. ACCESS TO WELFARE; WELFARE OUTCOMES.

    Section 411 (42 U.S.C. 611) is amended by adding at the end the 
following:
    ``(c) Annual Reports on Welfare Access and Outcomes.--
            ``(1) State reports.--Not later than January 1 of each 
        fiscal year, each eligible State shall collect and report to 
        the Secretary, with respect to the preceding fiscal year, the 
        following information:
                    ``(A) The number of applications for assistance 
                from the State program funded under this part, the 
                percentage that are approved versus those that are 
                disapproved, and the reasons for disapproval, broken 
                down by race.
                    ``(B) A copy of all rules and policies governing 
                the State program funded under this part that are not 
                required by Federal law, and a summary of the rules and 
                policies, including the amounts and types of assistance 
                provided and the types of sanctions imposed under the 
                program.
                    ``(C) The types of occupations of, types of job 
                training received by, and types and levels of 
                educational attainment of recipients of assistance from 
                the State program funded under this part, broken down 
                by gender and race.
                    ``(D) The incidence of homelessness, of the use of 
                food pantries and soup kitchens, and of the use of 
                shelters among recipients of assistance from the State 
                program funded under this part and among individuals to 
                whom assistance under the State programs funded are 
                this part has ended within the past 12 months. The 
                information described in this subparagraph may be 
                provided by submitting disaggregated case record 
                information on a sample of families.
                    ``(E) The number of individuals to whom assistance 
                under the State program funded under this part has 
                ended during the year, broken down by the reasons why 
                the assistance has ended (including employment, 
                marriage, sanction, time limit, or State policy.
                    ``(F) The economic conditions of individuals to 
                whom assistance under the State programs funded are 
                this part has ended, including the types of occupations 
                of, the duration of employment of, the income of, the 
                benefits provided to, the types of job training 
                received by, the types and levels of educational 
                attainment of, and the incidence of homelessness, of 
                the use of food pantries or soup kitchens, and of the 
                use of shelters among, such individuals, broken down by 
                gender and race.
                    ``(G) The effects of applying the 5-year time limit 
                to individuals who, in the absence of the limit, would 
                continue to be eligible for assistance from the State 
                program funded under this part, including the economic 
                and social circumstances of the individuals, including 
                income, employment, homelessness, use of food pantries 
                or soup kitchens, and change in child custody 
                arrangements.
            ``(2) Use of sampling.--A State may comply with this 
        subsection by using a scientifically acceptable sampling method 
        approved by the Secretary.
            ``(3) Report to the congress.--Not later than June 1 of 
        each fiscal year, the Secretary shall prepare and submit to the 
        Committee on Ways and Means of the House of Representatives and 
        the Committee on Finance of the Senate, publish in the Federal 
        Register, and make available to the public a compilation of the 
        reports submitted pursuant to paragraph (1) for the preceding 
        fiscal year.''.

SEC. 504. ASSESSMENT OF REGIONAL ECONOMIES TO IDENTIFY HIGHER ENTRY 
              LEVEL WAGE OPPORTUNITIES IN INDUSTRIES EXPERIENCING LABOR 
              SHORTAGES.

    Section 411 (42 U.S.C. 611) is further amended by adding at the end 
the following:
    ``(d) Assessment of Regional Economies to Identify Higher Entry 
Level Wage Opportunities in Industries Experiencing Labor Shortages.--
            ``(1) In general.--An eligible State shall conduct annually 
        an assessment of its regional economies that are experiencing a 
        labor shortage and that provide higher entry-level wage 
        opportunities for job seekers pursuant to section 402(a)(8).
            ``(2) Matters to be assessed.--
                    ``(A) Labor market.--The assessment shall--
                            ``(i) identify industries or occupations 
                        that have or expect to grow, that have or 
                        expect a loss of skilled workers, or that have 
                        a need for workers;
                            ``(ii) identify the entry-level education 
                        and skills requirements for the industries or 
                        occupations that have or expect a need for 
                        workers; and
                            ``(iii) analyze the entry-level wages and 
                        benefits in identified industries or 
                        occupations.
                    ``(B) Job seekers.--The assessment shall create a 
                profile of the characteristics of the unemployed and 
                underemployed residents of the State, including 
                educational attainment, barriers to employment, 
                geographic concentrations, self-sufficiency needs, and 
                access to needed support services.
                    ``(C) Education and training infrastructure.--The 
                assessment shall create a profile of the education, 
                training, and support services in place in the State to 
                prepare workers for the industries or occupations 
                identified pursuant to subparagraph (A).
                    ``(D) Aligning industries and job seekers.--The 
                assessment shall compare the characteristics of the 
                industries or occupations identified pursuant to 
                subparagraph (A) to the profile of the job seekers in 
                the State and the profile of the education and training 
                infrastructure in the State.
            ``(3) Sharing of information with localities.--The State 
        shall share with the political subdivisions of the State 
        information obtained pursuant to this subsection regarding 
        higher entry-wage job opportunities in industries experiencing 
        labor shortages, and information regarding opportunities for 
        collaboration with institutions of higher education, community-
        based organizations, and economic development and welfare 
        agencies.
            ``(4) Reports of assessment of regional economies.--Each 
        eligible state shall submit to the Secretary annually a report 
        hat contains the annual assessment conducted pursuant to this 
        subsection.''.

SEC. 505. RESEARCH, EVALUATIONS, AND NATIONAL STUDIES.

    Section 413 (42 U.S.C. 613) is amended--
            (1) in subsection (a), by striking the 2nd sentence;
            (2) in subsection (b)--
                    (A) in the subsection heading by striking ``Welfare 
                Dependency'' and inserting ``Poverty''; and
                    (B) in paragraph (1), by striking ``welfare 
                dependency'' and inserting ``poverty'';
            (3) by striking subsections (d), (e), (g), and (j);
            (4) in subsection (h)--
                    (A) in paragraph (1)--
                            (i) in subparagraph (B), by striking 
                        welfare dependency'' and inserting ``poverty''; 
                        and
                            (ii) in subparagraph (C), by striking 
                        ``(f)'' and inserting ``(d)''; and
                    (B) by adding at the end the following:
            ``(4) Technical assistance in assessing regional 
        economies.--
                    ``(A) In general.--The Secretary may provide 
                technical assistance to an eligible State to enable the 
                State to conduct the assessments required by section 
                411(d).
                    ``(B) Limitations on authorization of 
                appropriations.--For the cost of providing technical 
                assistance under subparagraph (A), there are authorized 
                to be appropriated to the Secretary not more than 
                $1,500,000 for each of fiscal years 2002 through 
                2008.'';
            (5) in subsection (i)--
                    (A) in paragraph (1), by adding at the end the 
                following: ``The statement shall include detailed 
                information on the depth of child poverty in the 
                State.''; and
                    (B) in paragraph (5), by inserting ``and the depth 
                of child poverty'' before ``in the State''; and
            (6) by redesignating subsections (f), (h), and (i) as 
        subsections (d) through (f), respectively.

SEC. 506. STUDY BY THE CENSUS BUREAU.

    Section 414(a) (42 U.S.C. 614(a)) is amended by striking all that 
follows ``low-income families'' and inserting a period.

                           TITLE VI--WAIVERS

SEC. 601. WAIVERS.

    Section 415(a) (42 U.S.C. 615(a)) is amended in each of paragraphs 
(1)(A) and (2)(A) by striking ``(determined without regard to any 
extensions)''.

         TITLE VII--REPEAL OF LIMITATION ON FEDERAL AUTHORITY.

SEC. 701. REPEAL OF LIMITATION ON FEDERAL AUTHORITY.

    Section 417 (42 U.S.C. 617) is repealed.

                   TITLE VIII--MINIMUM BENEFIT RULES

SEC. 801. MINIMUM BENEFIT RULES.

    Part A of title IV (42 U.S.C. 601-619), as amended by section 701 
of this Act, is amended by inserting after section 416 the following:

``SEC. 417. MINIMUM BENEFIT RULES.

    ``(a) In General.--After taking into account all costs of living 
and family size in each State with a program funded under this part, 
the Secretary shall, by regulation, prescribe a minimum cash benefit in 
accordance with subsection (b), which shall be payable by the State to 
each recipient of assistance under the program.
    ``(b) Limitation.--The minimum cash benefit prescribed for a family 
under subsection (a) shall be an amount that is not less than the sum 
of the poverty line applicable to the family, plus the amount (if any) 
by which the housing costs of the family exceeds 30 percent of the 
poverty line applicable to the family.''.

                          TITLE IX--CHILD CARE

SEC. 901. INDIVIDUAL ENTITLEMENT TO CHILD CARE.

    Section 418 (42 U.S.C. 618) is amended--
            (1) by striking subsection (b) and inserting the following:
    ``(b) Use of Funds to Provide Individual Entitlement to Child 
Care.--A State to which a grant is made under this section shall use 
the grant, without fiscal year limitation, only to guarantee safe, 
appropriate, affordable, and quality care for any child of (or with 
respect to whom any of the following is acting as a caretaker 
relative)--
            ``(1) any recipient of assistance under the State program 
        funded under this part who is employed or participating in a 
        work activity required pursuant to this part (except for full-
        time participation in a work activity described in section 
        407(d)(12)); and
            ``(2) any other employed individual who is a member of a 
        family whose income is less than 250 percent of the poverty 
        line and who, during the past 24 months, ceased to receive 
        assistance under any State program funded under this part.''; 
        and
            (2) in subsection (c), by inserting ``, but subject to 
        subsection (b) of this section'' after the 1st comma.

                  TITLE X--DEFINITION OF POVERTY LINE

SEC. 1001. DEFINITION OF POVERTY LINE.

    Section 419 (42 U.S.C. 619) is amended by adding at the end the 
following:
            ``(6) Poverty line.--The term `poverty line' has the 
        meaning given the term in section 673(2) of the Omnibus Budget 
        Reconciliation Act of 1981, including any revision required by 
        such section applicable to a family of the size involved.''.

                      TITLE XI--SERVICE PROVIDERS

SEC. 1101. PROTECTION FOR BENEFICIARIES.

    Section 104 of the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996 (42 U.S.C. 604a) is amended--
            (1) in subsection (e), by striking ``Rights of 
        Beneficiaries of Assistance'' and inserting ``Protection for 
        Beneficiaries''; and
            (2) by adding at the end the following:
    ``(l) No Discrimination In Hiring With Taxpayer Dollars.--Sections 
702 and 703(e)(2) of the Civil Rights Act of 1964 shall not apply to a 
nongovernmental organization that receives funds under a program 
described in subsection (a)(2) of this section with respect to an 
individual who provides, or would provide, services funded in whole or 
in part under such a program, or individuals whose employment is, or 
would be, funded in whole or in part under such a program.
    ``(m) Beneficiary Rights.--A nongovernmental organization that 
receives funds under a program funded under subsection (a)(2) may not, 
in providing services funded in whole or in part under such a program 
or engaging in outreach activities for services funded in whole or in 
part under such a program--
            ``(1) discriminate against a program beneficiary or 
        prospective beneficiary on the basis of religion or religious 
        belief; or
            ``(2) include sectarian worship, instruction or 
        proselytization in such a program, or require or coerce a 
        beneficiary to participate in, or be present for, sectarian 
        worship, instruction or proselytization.''.

                       TITLE XII--EFFECTIVE DATE

SEC. 1201. EFFECTIVE DATE.

    Except as otherwise provided, this Act and the amendments made by 
this Act shall take effect on October 1, 2002.
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