[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4737 Reported in Senate (RS)]






                                                       Calendar No. 518
107th CONGRESS
  2d Session
                                H.R. 4737

                          [Report No. 107-221]


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                 May 16 (legislative day, May 9), 2002

     Received; read twice and referred to the Committee on Finance

                             July 25, 2002

               Reported by Mr. Baucus, with an amendment
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]

_______________________________________________________________________

                                 AN ACT


 
 To reauthorize and improve the program of block grants to States for 
  temporary assistance for needy families, improve access to quality 
                  child care, and for other purposes.

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

<DELETED>SECTION 1. SHORT TITLE.</DELETED>

<DELETED>    This Act may be cited as the ``Personal Responsibility, 
Work, and Family Promotion Act of 2002''.</DELETED>

<DELETED>SEC. 2. TABLE OF CONTENTS.</DELETED>

<DELETED>    The table of contents of this Act is as follows:</DELETED>

<DELETED>Sec. 1. Short title.
<DELETED>Sec. 2. Table of contents.
<DELETED>Sec. 3. References.
<DELETED>Sec. 4. Findings.
                         <DELETED>TITLE I--TANF

<DELETED>Sec. 101. Purposes.
<DELETED>Sec. 102. Family assistance grants.
<DELETED>Sec. 103. Promotion of family formation and healthy marriage.
<DELETED>Sec. 104. Supplemental grant for population increases in 
                            certain States.
<DELETED>Sec. 105. Bonus to reward employment achievement.
<DELETED>Sec. 106. Contingency fund.
<DELETED>Sec. 107. Use of funds.
<DELETED>Sec. 108. Repeal of Federal loan for State welfare programs.
<DELETED>Sec. 109. Universal engagement and family self-sufficiency 
                            plan requirements.
<DELETED>Sec. 110. Work participation requirements.
<DELETED>Sec. 111. Maintenance of effort.
<DELETED>Sec. 112. Performance improvement.
<DELETED>Sec. 113. Data collection and reporting.
<DELETED>Sec. 114. Direct funding and administration by Indian tribes.
<DELETED>Sec. 115. Research, evaluations, and national studies.
<DELETED>Sec. 116. Studies by the Census Bureau and the General 
                            Accounting Office.
<DELETED>Sec. 117. Definition of assistance.
<DELETED>Sec. 118. Technical corrections.
<DELETED>Sec. 119. Fatherhood program.
<DELETED>Sec. 120. State option to make TANF programs mandatory 
                            partners with one-stop employment training 
                            centers.
<DELETED>Sec. 121. Sense of the Congress.
                     <DELETED>TITLE II--CHILD CARE

<DELETED>Sec. 201. Short title.
<DELETED>Sec. 202. Goals.
<DELETED>Sec. 203. Authorization of appropriations.
<DELETED>Sec. 204. Application and plan.
<DELETED>Sec. 205. Activities to improve the quality of child care.
<DELETED>Sec. 206. Report by Secretary.
<DELETED>Sec. 207. Definitions.
<DELETED>Sec. 208. Entitlement funding.
                <DELETED>TITLE III--TAXPAYER PROTECTIONS

<DELETED>Sec. 301. Exclusion from gross income for interest on 
                            overpayments of income tax by individuals.
<DELETED>Sec. 302. Deposits made to suspend running of interest on 
                            potential underpayments.
<DELETED>Sec. 303. Partial payment of tax liability in installment 
                            agreements.
                    <DELETED>TITLE IV--CHILD SUPPORT

<DELETED>Sec. 401. Federal matching funds for limited pass through of 
                            child support payments to families 
                            receiving TANF.
<DELETED>Sec. 402. State option to pass through all child support 
                            payments to families that formerly received 
                            TANF.
<DELETED>Sec. 403. Mandatory review and adjustment of child support 
                            orders for families receiving TANF.
<DELETED>Sec. 404. Mandatory fee for successful child support 
                            collection for family that has never 
                            received TANF.
<DELETED>Sec. 405. Report on undistributed child support payments.
<DELETED>Sec. 406. Use of new hire information to assist in 
                            administration of unemployment compensation 
                            programs.
<DELETED>Sec. 407. Decrease in amount of child support arrearage 
                            triggering passport denial.
<DELETED>Sec. 408. Use of tax refund intercept program to collect past-
                            due child support on behalf of children who 
                            are not minors.
<DELETED>Sec. 409. Garnishment of compensation paid to veterans for 
                            service-connected disabilities in order to 
                            enforce child support obligations.
<DELETED>Sec. 410. Improving Federal debt collection practices.
<DELETED>Sec. 411. Maintenance of technical assistance funding.
<DELETED>Sec. 412. Maintenance of Federal Parent Locator Service 
                            funding.
                    <DELETED>TITLE V--CHILD WELFARE

<DELETED>Sec. 501. Extension of authority to approve demonstration 
                            projects.
<DELETED>Sec. 502. Elimination of limitation on number of waivers.
<DELETED>Sec. 503. Elimination of limitation on number of States that 
                            may be granted waivers to conduct 
                            demonstration projects on same topic.
<DELETED>Sec. 504. Elimination of limitation on number of waivers that 
                            may be granted to a single State for 
                            demonstration projects.
<DELETED>Sec. 505. Streamlined process for consideration of amendments 
                            to and extensions of demonstration projects 
                            requiring waivers.
<DELETED>Sec. 506. Availability of reports.
<DELETED>Sec. 507. Technical correction.
            <DELETED>TITLE VI--SUPPLEMENTAL SECURITY INCOME

<DELETED>Sec. 601. Review of State agency blindness and disability 
                            determinations.
            <DELETED>TITLE VII--STATE AND LOCAL FLEXIBILITY

<DELETED>Sec. 701. Program coordination demonstration projects.
<DELETED>Sec. 702. State food assistance block grant demonstration 
                            project.
               <DELETED>TITLE VIII--ABSTINENCE EDUCATION

<DELETED>Sec. 801. Extension of abstinence education funding under 
                            maternal and child health program.
           <DELETED>TITLE IX--TRANSITIONAL MEDICAL ASSISTANCE

<DELETED>Sec. 901. One-year reauthorization of transitional medical 
                            assistance.
<DELETED>Sec. 902. Adjustment to payments for medicaid administrative 
                            costs to prevent duplicative payments and 
                            to fund a 1-year extension of transitional 
                            medical assistance.
                    <DELETED>TITLE X--EFFECTIVE DATE

<DELETED>Sec. 1001. Effective date.

<DELETED>SEC. 3. REFERENCES.</DELETED>

<DELETED>    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.</DELETED>

<DELETED>SEC. 4. FINDINGS.</DELETED>

<DELETED>    The Congress makes the following findings:</DELETED>
        <DELETED>    (1) The Temporary Assistance for Needy Families 
        (TANF) Program established by the Personal Responsibility and 
        Work Opportunity Reconciliation Act of 1996 (Public Law 104-
        193) has succeeded in moving families from welfare to work and 
        reducing child poverty.</DELETED>
                <DELETED>    (A) There has been a dramatic increase in 
                the employment of current and former welfare 
                recipients. The percentage of working recipients 
                reached an all-time high in fiscal years 1999 and 2000. 
                In fiscal year 1999, 33 percent of adult recipients 
                were working, compared to less than 7 percent in fiscal 
                year 1992, and 11 percent in fiscal year 1996. All 
                States met the overall participation rate standard in 
                fiscal year 2000, as did the District of Columbia and 
                Puerto Rico.</DELETED>
                <DELETED>    (B) Earnings for welfare recipients 
                remaining on the rolls have also increased 
                significantly, as have earnings for female-headed 
                households. The increases have been particularly large 
                for the bottom 2 income quintiles, that is, those women 
                who are most likely to be former or present welfare 
                recipients.</DELETED>
                <DELETED>    (C) Welfare dependency has plummeted. As 
                of September 2001, 2,103,000 families and 5,333,000 
                individuals were receiving assistance. Accordingly, the 
                number of families in the welfare caseload and the 
                number of individuals receiving cash assistance 
                declined 52 percent and 56 percent, respectively, since 
                the enactment of TANF. These declines have persisted 
                even as unemployment rates have increased: unemployment 
                rates nationwide rose 25 percent, from 3.9 percent in 
                September 2000 to 4.9 percent in September 2001, while 
                welfare caseloads continued to drop by 7 
                percent.</DELETED>
                <DELETED>    (D) The child poverty rate continued to 
                decline between 1996 and 2000, falling 21 percent from 
                20.5 to 16.2 percent. The 2000 child poverty rate is 
                the lowest since 1979. Child poverty rates for African-
                American and Hispanic children have also fallen 
                dramatically during the past 6 years. African-American 
                child poverty is at the lowest rate on record and 
                Hispanic child poverty has had the largest 4-year 
                decrease on record.</DELETED>
                <DELETED>    (E) Despite these gains, States have had 
                mixed success in fully engaging welfare recipients in 
                work activities. While all States have met the overall 
                work participation rates required by law, in 2000, in 
                an average month, only about </DELETED>\<DELETED>1/
                3</DELETED>\ <DELETED>of all families with an adult 
                participated in work activities that were countable 
                toward the State's participation rate. Eight 
                jurisdictions failed to meet the more rigorous 2-parent 
                work requirements, and about 20 States are not subject 
                to the 2-parent requirements, most because they moved 
                their 2-parent cases to separate State programs where 
                they are not subject to a penalty for failing the 2-
                parent rates.</DELETED>
        <DELETED>    (2) As a Nation, we have made substantial progress 
        in reducing teen pregnancies and births, slowing increases in 
        nonmarital childbearing, and improving child support 
        collections and paternity establishment.</DELETED>
                <DELETED>    (A) The teen birth rate has fallen 
                continuously since 1991, down a dramatic 22 percent by 
                2000. During the period of 1991-2000, teenage birth 
                rates fell in all States and the District of Columbia, 
                Puerto Rico, and the Virgin Islands. Declines also have 
                spanned age, racial, and ethnic groups. There has been 
                success in lowering the birth rate for both younger and 
                older teens. The birth rate for those 15-17 years of 
                age is down 29 percent since 1991, and the rate for 
                those 18 and 19 is down 16 percent. Between 1991 and 
                2000, teen birth rates declined for all women ages 15-
                19--white, African American, American Indian, Asian or 
                Pacific Islander, and Hispanic women ages 15-19. The 
                rate for African American teens--until recently the 
                highest--experienced the largest decline, down 31 
                percent from 1991 to 2000, to reach the lowest rate 
                ever reported for this group. Most births to teens are 
                nonmarital; in 2000, about 73 percent of the births to 
                teens aged 15-19 occurred outside of 
                marriage.</DELETED>
                <DELETED>    (B) Nonmarital childbearing continued to 
                increase slightly in 2000, however not at the sharp 
                rates of increase seen in recent decades. The birth 
                rate among unmarried women in 2000 was 3.5 percent 
                lower than its peak reached in 1994, while the 
                proportion of births occurring outside of marriage has 
                remained at approximately 33 percent since 
                1998.</DELETED>
                <DELETED>    (C) The negative consequences of out-of-
                wedlock birth on the mother, the child, the family, and 
                society are well documented. These include increased 
                likelihood of welfare dependency, increased risks of 
                low birth weight, poor cognitive development, child 
                abuse and neglect, and teen parenthood, and decreased 
                likelihood of having an intact marriage during 
                adulthood.</DELETED>
                <DELETED>    (D) An estimated 23,900,000 children do 
                not live with their biological father. 16,000,000 
                children live with their mother only. These facts are 
                attributable largely to declining marriage rates, 
                increasing divorce rates, and increasing rates of 
                nonmarital births during the latter part of the 20th 
                century.</DELETED>
                <DELETED>    (E) There has been a dramatic rise in 
                cohabitation as marriages have declined. Only 40 
                percent of children of cohabiting couples will see 
                their parents marry. Those who do marry experience a 50 
                percent higher divorce rate. Children in single-parent 
                households and cohabiting households are at much higher 
                risk of child abuse than children in intact married and 
                stepparent families.</DELETED>
                <DELETED>    (F) Children who live apart from their 
                biological fathers, on average, are more likely to be 
                poor, experience educational, health, emotional, and 
                psychological problems, be victims of child abuse, 
                engage in criminal behavior, and become involved with 
                the juvenile justice system than their peers who live 
                with their married, biological mother and father. A 
                child living in a single-parent family is nearly 5 
                times as likely to be poor as a child living in a 
                married-couple family. In married-couple families, the 
                child poverty rate is 8.1 percent, in households headed 
                by a single mother, the poverty rate is 39.7 
                percent.</DELETED>
                <DELETED>    (G) Since the enactment of the Personal 
                Responsibility and Work Opportunity Reconciliation Act 
                of 1996, child support collections within the child 
                support enforcement system have grown every year, 
                increasing from $12,000,000,000 in fiscal year 1996 to 
                nearly $19,000,000,000 in fiscal year 2001. The number 
                of paternities established or acknowledged in fiscal 
                year 2002 reached an historic high of over 1,500,000--
                which includes a nearly 100 percent increase through 
                in-hospital acknowledgement programs to 688,510 in 2000 
                from 349,356 in 1996. Child support collections were 
                made in over 7,000,000 cases in fiscal year 2000, 
                significantly more than the almost 4,000,000 cases 
                having a collection in 1996.</DELETED>
        <DELETED>    (3) The Personal Responsibility and Work 
        Opportunity Reconciliation Act of 1996 gave States great 
        flexibility in the use of Federal funds to develop innovative 
        programs to help families leave welfare and begin employment 
        and to encourage the formation of 2-parent families.</DELETED>
                <DELETED>    (A) Total Federal and State TANF 
                expenditures in fiscal year 2000 were $24,000,000,000, 
                up from $22,600,000,000 for the previous year. This 
                increased spending is attributable to significant new 
                investments in supportive services in the TANF program, 
                such as child care and activities to support 
                work.</DELETED>
                <DELETED>    (B) Since the welfare reform effort began 
                there has been a dramatic increase in work 
                participation (including employment, community service, 
                and work experience) among welfare recipients, as well 
                as an unprecedented reduction in the caseload because 
                recipients have left welfare for work.</DELETED>
                <DELETED>    (C) States are making policy choices and 
                investment decisions best suited to the needs of their 
                citizens.</DELETED>
                        <DELETED>    (i) To expand aid to working 
                        families, all States disregard a portion of a 
                        family's earned income when determining benefit 
                        levels.</DELETED>
                        <DELETED>    (ii) Most States increased the 
                        limits on countable assets above the former Aid 
                        to Families with Dependent Children (AFDC) 
                        program. Every State has increased the vehicle 
                        asset level above the prior AFDC limit for a 
                        family's primary automobile.</DELETED>
                        <DELETED>    (iii) States are experimenting 
                        with programs to promote marriage and father 
                        involvement. Over half the States have 
                        eliminated restrictions on 2-parent families. 
                        Many States use TANF, child support, or State 
                        funds to support community-based activities to 
                        help fathers become more involved in their 
                        children's lives or strengthen relationships 
                        between mothers and fathers.</DELETED>
        <DELETED>    (4) Therefore, it is the sense of the Congress 
        that increasing success in moving families from welfare to 
        work, as well as in promoting healthy marriage and other means 
        of improving child well-being, are very important Government 
        interests and the policy contained in part A of title IV of the 
        Social Security Act (as amended by this Act) is intended to 
        serve these ends.</DELETED>

                    <DELETED>TITLE I--TANF</DELETED>

<DELETED>SEC. 101. PURPOSES.</DELETED>

<DELETED>    Section 401(a) (42 U.S.C. 601(a)) is amended--</DELETED>
        <DELETED>    (1) in the matter preceding paragraph (1), by 
        striking ``increase'' and inserting ``improve child well-being 
        by increasing'';</DELETED>
        <DELETED>    (2) in paragraph (1), by inserting ``and 
        services'' after ``assistance'';</DELETED>
        <DELETED>    (3) in paragraph (2), by striking ``parents on 
        government benefits'' and inserting ``families on government 
        benefits and reduce poverty''; and</DELETED>
        <DELETED>    (4) in paragraph (4), by striking ``two-parent 
        families'' and inserting ``healthy, 2-parent married families, 
        and encourage responsible fatherhood''.</DELETED>

<DELETED>SEC. 102. FAMILY ASSISTANCE GRANTS.</DELETED>

<DELETED>    (a) Extension of Authority.--Section 403(a)(1)(A) (42 
U.S.C. 603(a)(1)(A)) is amended--</DELETED>
        <DELETED>    (1) by striking ``1996, 1997, 1998, 1999, 2000, 
        2001, and 2002'' and inserting ``2003 through 2007''; 
        and</DELETED>
        <DELETED>    (2) by inserting ``payable to the State for the 
        fiscal year'' before the period.</DELETED>
<DELETED>    (b) State Family Assistance Grant.--Section 403(a)(1) (42 
U.S.C. 603(a)(1)) is amended by striking subparagraphs (B) through (E) 
and inserting the following:</DELETED>
                <DELETED>    ``(B) State family assistance grant.--The 
                State family assistance grant payable to a State for a 
                fiscal year shall be the amount that bears the same 
                ratio to the amount specified in subparagraph (C) of 
                this paragraph as the amount required to be paid to the 
                State under this paragraph for fiscal year 2002 
                (determined without regard to any reduction pursuant to 
                section 412(a)(1)) bears to the total amount required 
                to be paid under this paragraph for fiscal year 
                2002.</DELETED>
                <DELETED>    ``(C) Appropriation.--Out of any money in 
                the Treasury of the United States not otherwise 
                appropriated, there are appropriated for each of fiscal 
                years 2003 through 2007 $16,566,542,000 for grants 
                under this paragraph.''.</DELETED>
<DELETED>    (c) Matching Grants for the Territories.--Section 
1108(b)(2) (42 U.S.C. 1308(b)(2)) is amended by striking ``1997 through 
2002'' and inserting ``2003 through 2007''.</DELETED>

<DELETED>SEC. 103. PROMOTION OF FAMILY FORMATION AND HEALTHY 
              MARRIAGE.</DELETED>

<DELETED>    (a) State Plans.--Section 402(a)(1)(A) (42 U.S.C. 
602(a)(1)(A)) is amended by adding at the end the following:</DELETED>
                        <DELETED>    ``(vii) Encourage equitable 
                        treatment of married, 2-parent families under 
                        the program referred to in clause 
                        (i).''.</DELETED>
<DELETED>    (b) Healthy Marriage Promotion Grants; Repeal of Bonus for 
Reduction of Illegitimacy Ratio.--Section 403(a)(2) (42 U.S.C. 
603(a)(2)) is amended to read as follows:</DELETED>
        <DELETED>    ``(2) Healthy marriage promotion grants.--
        </DELETED>
                <DELETED>    ``(A) Authority.--The Secretary shall 
                award competitive grants to States, territories, and 
                tribal organizations for not more than 50 percent of 
                the cost of developing and implementing innovative 
                programs to promote and support healthy, married, 2-
                parent families.</DELETED>
                <DELETED>    ``(B) Healthy marriage promotion 
                activities.--Funds provided under subparagraph (A) 
                shall be used to support any of the following programs 
                or activities:</DELETED>
                        <DELETED>    ``(i) Public advertising campaigns 
                        on the value of marriage and the skills needed 
                        to increase marital stability and 
                        health.</DELETED>
                        <DELETED>    ``(ii) Education in high schools 
                        on the value of marriage, relationship skills, 
                        and budgeting.</DELETED>
                        <DELETED>    ``(iii) Marriage education, 
                        marriage skills, and relationship skills 
                        programs, that may include parenting skills, 
                        financial management, conflict resolution, and 
                        job and career advancement, for non-married 
                        pregnant women and non-married expectant 
                        fathers.</DELETED>
                        <DELETED>    ``(iv) Pre-marital education and 
                        marriage skills training for engaged couples 
                        and for couples interested in 
                        marriage.</DELETED>
                        <DELETED>    ``(v) Marriage enhancement and 
                        marriage skills training programs for married 
                        couples.</DELETED>
                        <DELETED>    ``(vi) Divorce reduction programs 
                        that teach relationship skills.</DELETED>
                        <DELETED>    ``(vii) Marriage mentoring 
                        programs which use married couples as role 
                        models and mentors in at-risk 
                        communities.</DELETED>
                        <DELETED>    ``(viii) Programs to reduce the 
                        disincentives to marriage in means-tested aid 
                        programs, if offered in conjunction with any 
                        activity described in this 
                        subparagraph.</DELETED>
                <DELETED>    ``(C) Appropriation.--Out of any money in 
                the Treasury of the United States not otherwise 
                appropriated, there are appropriated for each of fiscal 
                years 2003 through 2007 $100,000,000 for grants under 
                this paragraph.''.</DELETED>
<DELETED>    (c) Counting of Spending on Non-Eligible Families to 
Prevent and Reduce Incidence of Out-of-Wedlock Births, Encourage 
Formation and Maintenance of Healthy, 2-Parent Married Families, or 
Encourage Responsible Fatherhood.--Section 409(a)(7)(B)(i) (42 U.S.C. 
609(a)(7)(B)(i)) is amended by adding at the end the 
following:</DELETED>
                                <DELETED>    ``(V) Counting of spending 
                                on non-eligible families to prevent and 
                                reduce incidence of out-of-wedlock 
                                births, encourage formation and 
                                maintenance of healthy, 2-parent 
                                married families, or encourage 
                                responsible fatherhood.--The term 
                                `qualified State expenditures' includes 
                                the total expenditures by the State 
                                during the fiscal year under all State 
                                programs for a purpose described in 
                                paragraph (3) or (4) of section 
                                401(a).''.</DELETED>

<DELETED>SEC. 104. SUPPLEMENTAL GRANT FOR POPULATION INCREASES IN 
              CERTAIN STATES.</DELETED>

<DELETED>    Section 403(a)(3)(H) (42 U.S.C. 603(a)(3)(H)) is amended--
</DELETED>
        <DELETED>    (1) in the subparagraph heading, by striking ``of 
        grants for fiscal year 2002'';</DELETED>
        <DELETED>    (2) in clause (i), by striking ``fiscal year 
        2002'' and inserting ``each of fiscal years 2002 through 
        2006'';</DELETED>
        <DELETED>    (3) in clause (ii), by striking ``2002'' and 
        inserting ``2006''; and</DELETED>
        <DELETED>    (4) in clause (iii), by striking ``fiscal year 
        2002'' and inserting ``each of fiscal years 2002 through 
        2006''.</DELETED>

<DELETED>SEC. 105. BONUS TO REWARD EMPLOYMENT ACHIEVEMENT.</DELETED>

<DELETED>    (a) Reallocation of Funding.--Section 403(a)(4) (42 U.S.C. 
603(a)(4)) is amended--</DELETED>
        <DELETED>    (1) in the paragraph heading, by striking ``high 
        performance states'' and inserting ``employment 
        achievement'';</DELETED>
        <DELETED>    (2) in subparagraph (D)(ii)--</DELETED>
                <DELETED>    (A) in subclause (I), by striking ``equals 
                $200,000,000'' and inserting ``(other than 2003) equals 
                $200,000,000, and for bonus year 2003 equals 
                $100,000,000''; and</DELETED>
                <DELETED>    (B) in subclause (II), by striking 
                ``$1,000,000,000'' and inserting ``$900,000,000''; 
                and</DELETED>
        <DELETED>    (3) in subparagraph (F), by striking 
        ``$1,000,000,000'' and inserting ``$900,000,000''.</DELETED>
<DELETED>    (b) Bonus to Reward Employment Achievement.--</DELETED>
        <DELETED>    (1) In general.--Section 403(a)(4) (42 U.S.C. 
        603(a)(4)) is amended by striking subparagraphs (A) through (F) 
        and inserting the following:</DELETED>
                <DELETED>    ``(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 an 
                employment achievement State.</DELETED>
                <DELETED>    ``(B) Amount of grant.--</DELETED>
                        <DELETED>    ``(i) In general.--Subject to 
                        clause (ii) of this subparagraph, the Secretary 
                        shall determine the amount of the grant payable 
                        under this paragraph to an employment 
                        achievement State for a bonus year, which shall 
                        be based on the performance of the State as 
                        determined under subparagraph (D)(i) for the 
                        fiscal year that immediately precedes the bonus 
                        year.</DELETED>
                        <DELETED>    ``(ii) Limitation.--The amount 
                        payable to a State under this paragraph for a 
                        bonus year shall not exceed 5 percent of the 
                        State family assistance grant.</DELETED>
                <DELETED>    ``(C) Formula for measuring state 
                performance.--</DELETED>
                        <DELETED>    ``(i) In general.--Subject to 
                        clause (ii), not later than October 1, 2003, 
                        the Secretary, in consultation with the States, 
                        shall develop a formula for measuring State 
                        performance in operating the State program 
                        funded under this part so as to achieve the 
                        goals of employment entry, job retention, and 
                        increased earnings from employment for families 
                        receiving assistance under the program, as 
                        measured on an absolute basis and on the basis 
                        of improvement in State performance.</DELETED>
                        <DELETED>    ``(ii) Special rule for bonus year 
                        2004.--For the purposes of awarding a bonus 
                        under this paragraph for bonus year 2004, the 
                        Secretary may measure the performance of a 
                        State in fiscal year 2003 using the job entry 
                        rate, job retention rate, and earnings gain 
                        rate components of the formula developed under 
                        section 403(a)(4)(C) as in effect immediately 
                        before the effective date of this 
                        paragraph.</DELETED>
                <DELETED>    ``(D) Determination of state 
                performance.--For each bonus year, the Secretary 
                shall--</DELETED>
                        <DELETED>    ``(i) use the formula developed 
                        under subparagraph (C) to determine the 
                        performance of each eligible State for the 
                        fiscal year that precedes the bonus year; 
                        and</DELETED>
                        <DELETED>    ``(ii) prescribe performance 
                        standards in such a manner so as to ensure 
                        that--</DELETED>
                                <DELETED>    ``(I) the average annual 
                                total amount of grants to be made under 
                                this paragraph for each bonus year 
                                equals $100,000,000; and</DELETED>
                                <DELETED>    ``(II) the total amount of 
                                grants to be made under this paragraph 
                                for all bonus years equals 
                                $500,000,000.</DELETED>
                <DELETED>    ``(E) Definitions.--In this 
                paragraph:</DELETED>
                        <DELETED>    ``(i) Bonus year.--The term `bonus 
                        year' means each of fiscal years 2004 through 
                        2008.</DELETED>
                        <DELETED>    ``(ii) Employment achievement 
                        state.--The term `employment achievement State' 
                        means, with respect to a bonus year, an 
                        eligible State whose performance determined 
                        pursuant to subparagraph (D)(i) for the fiscal 
                        year preceding the bonus year equals or exceeds 
                        the performance standards prescribed under 
                        subparagraph (D)(ii) for such preceding fiscal 
                        year.</DELETED>
                <DELETED>    ``(F) Appropriation.--Out of any money in 
                the Treasury of the United States not otherwise 
                appropriated, there are appropriated for fiscal years 
                2004 through 2008 $500,000,000 for grants under this 
                paragraph.</DELETED>
                <DELETED>    ``(G) Grants for tribal organizations.--
                This paragraph shall apply with respect to tribal 
                organizations in the same manner in which this 
                paragraph applies with respect to States. In 
                determining the criteria under which to make grants to 
                tribal organizations under this paragraph, the 
                Secretary shall consult with tribal 
                organizations.''.</DELETED>
        <DELETED>    (2) Effective date.--The amendment made by 
        paragraph (1) shall take effect on October 1, 2003.</DELETED>

<DELETED>SEC. 106. CONTINGENCY FUND.</DELETED>

<DELETED>    (a) Deposits Into Fund.--Section 403(b)(2) (42 U.S.C. 
603(b)(2)) is amended--</DELETED>
        <DELETED>    (1) by striking ``1997, 1998, 1999, 2000, 2001, 
        and 2002'' and inserting ``2003 through 2007''; and</DELETED>
        <DELETED>    (2) by striking all that follows 
        ``$2,000,000,000'' and inserting a period.</DELETED>
<DELETED>    (b) Grants.--Section 403(b)(3)(C)(ii) (42 U.S.C. 
603(b)(3)(C)(ii)) is amended by striking ``fiscal years 1997 through 
2002'' and inserting ``fiscal years 2003 through 2007''.</DELETED>
<DELETED>    (c) Definition of Needy State.--Clauses (i) and (ii) of 
section 403(b)(5)(B) (42 U.S.C. 603(b)(5)(B)) are amended by inserting 
after ``1996'' the following: ``, and the Food Stamp Act of 1977 as in 
effect during the corresponding 3-month period in the fiscal year 
preceding such most recently concluded 3-month period,''.</DELETED>
<DELETED>    (d) Annual Reconciliation: Federal Matching of State 
Expenditures Above ``Maintenance of Effort'' Level.--Section 403(b)(6) 
(42 U.S.C. 603(b)(6)) is amended--</DELETED>
        <DELETED>    (1) in subparagraph (A)(ii)--</DELETED>
                <DELETED>    (A) by adding ``and'' at the end of 
                subclause (I);</DELETED>
                <DELETED>    (B) by striking ``; and'' at the end of 
                subclause (II) and inserting a period; and</DELETED>
                <DELETED>    (C) by striking subclause (III);</DELETED>
        <DELETED>    (2) in subparagraph (B)(i)(II), by striking all 
        that follows ``section 409(a)(7)(B)(iii))'' and inserting a 
        period;</DELETED>
        <DELETED>    (3) by amending subparagraph (B)(ii)(I) to read as 
        follows:</DELETED>
                                <DELETED>    ``(I) the qualified State 
                                expenditures (as defined in section 
                                409(a)(7)(B)(i)) for the fiscal year; 
                                plus''; and</DELETED>
        <DELETED>    (4) by striking subparagraph (C).</DELETED>
<DELETED>    (e) Consideration of Certain Child Care Expenditures in 
Determining State Compliance With Contingency Fund Maintenance of 
Effort Requirement.--Section 409(a)(10) (42 U.S.C. 609(a)(10)) is 
amended--</DELETED>
        <DELETED>    (1) by striking ``(other than the expenditures 
        described in subclause (I)(bb) of that paragraph)) under the 
        State program funded under this part'' and inserting a close 
        parenthesis; and</DELETED>
        <DELETED>    (2) by striking ``excluding any amount expended by 
        the State for child care under subsection (g) or (i) of section 
        402 (as in effect during fiscal year 1994) for fiscal year 
        1994,''.</DELETED>

<DELETED>SEC. 107. USE OF FUNDS.</DELETED>

<DELETED>    (a) General Rules.--Section 404(a)(2) (42 U.S.C. 
604(a)(2)) is amended by striking ``in any manner that'' and inserting 
``for any purposes or activities for which''.</DELETED>
<DELETED>    (b) Treatment of Interstate Immigrants.--</DELETED>
        <DELETED>    (1) State plan provision.--Section 402(a)(1)(B) 
        (42 U.S.C. 602(a)(1)(B)) is amended by striking clause (i) and 
        redesignating clauses (ii) through (iv) as clauses (i) through 
        (iii), respectively.</DELETED>
        <DELETED>    (2) Use of funds.--Section 404 (42 U.S.C. 604) is 
        amended by striking subsection (c).</DELETED>
<DELETED>    (c) Increase in Amount Transferable to Child Care.--
Section 404(d)(1) (42 U.S.C. 604(d)(1)) is amended by striking ``30'' 
and inserting ``50''.</DELETED>
<DELETED>    (d) Increase in Amount Transferable to Title XX 
Programs.--Section 404(d)(2)(B) (42 U.S.C. 604(d)(2)(B)) is amended to 
read as follows:</DELETED>
                <DELETED>    ``(B) Applicable percent.--For purposes of 
                subparagraph (A), the applicable percent is 10 percent 
                for fiscal year 2003 and each succeeding fiscal 
                year.''.</DELETED>
<DELETED>    (e) Clarification of Authority of States To Use TANF Funds 
Carried Over From Prior Years To Provide TANF Benefits and Services.--
Section 404(e) (42 U.S.C. 604(e)) is amended to read as 
follows:</DELETED>
<DELETED>    ``(e) Authority To Carryover or Reserve Certain Amounts 
for Benefits or Services or for Future Contingencies.--</DELETED>
        <DELETED>    ``(1) Carryover.--A State or tribe may use a grant 
        made to the State or tribe under this part for any fiscal year 
        to provide, without fiscal year limitation, any benefit or 
        service that may be provided under the State or tribal program 
        funded under this part.</DELETED>
        <DELETED>    ``(2) Contingency reserve.--A State or tribe may 
        designate any portion of a grant made to the State or tribe 
        under this part as a contingency reserve for future needs, and 
        may use any amount so designated to provide, without fiscal 
        year limitation, any benefit or service that may be provided 
        under the State or tribal program funded under this part. If a 
        State or tribe so designates a portion of such a grant, the 
        State shall, on an annual basis, include in its report under 
        section 411(a) the amount so designated.''.</DELETED>

<DELETED>SEC. 108. REPEAL OF FEDERAL LOAN FOR STATE WELFARE 
              PROGRAMS.</DELETED>

<DELETED>    (a) Repeal.--Section 406 (42 U.S.C. 606) is 
repealed.</DELETED>
<DELETED>    (b) Conforming Amendments.--</DELETED>
        <DELETED>    (1) Section 409(a) (42 U.S.C. 609(a)) is amended 
        by striking paragraph (6).</DELETED>
        <DELETED>    (2) Section 412 (42 U.S.C. 612) is amended by 
        striking subsection (f) and redesignating subsections (g) 
        through (i) as subsections (f) through (h), 
        respectively.</DELETED>
        <DELETED>    (3) Section 1108(a)(2) (42 U.S.C. 1308(a)(2)) is 
        amended by striking ``406,''.</DELETED>

<DELETED>SEC. 109. UNIVERSAL ENGAGEMENT AND FAMILY SELF-SUFFICIENCY 
              PLAN REQUIREMENTS.</DELETED>

<DELETED>    (a) Modification of State Plan Requirements.--Section 
402(a)(1)(A) (42 U.S.C. 602(a)(1)(A)) is amended by striking clauses 
(ii) and (iii) and inserting the following:</DELETED>
                        <DELETED>    ``(ii) Require a parent or 
                        caretaker receiving assistance under the 
                        program to engage in work or alternative self-
                        sufficiency activities (as defined by the 
                        State), consistent with section 
                        407(e)(2).</DELETED>
                        <DELETED>    ``(iii) Require families receiving 
                        assistance under the program to engage in 
                        activities in accordance with family self-
                        sufficiency plans developed pursuant to section 
                        408(b).''.</DELETED>
<DELETED>    (b) Establishment of Family Self-Sufficiency Plans.--
</DELETED>
        <DELETED>    (1) In general.--Section 408(b) (42 U.S.C. 608(b)) 
        is amended to read as follows:</DELETED>
<DELETED>    ``(b) Family Self-Sufficiency Plans.--</DELETED>
        <DELETED>    ``(1) In general.--A State to which a grant is 
        made under section 403 shall--</DELETED>
                <DELETED>    ``(A) assess, in the manner deemed 
                appropriate by the State, of the skills, prior work 
                experience, and employability of each work-eligible 
                individual (as defined in section 407(b)(2)(C)) 
                receiving assistance under the State program funded 
                under this part;</DELETED>
                <DELETED>    ``(B) establish for each family that 
                includes such an individual, in consultation as the 
                State deems appropriate with the individual, a self-
                sufficiency plan that specifies appropriate activities 
                described in the State plan submitted pursuant to 
                section 402, including direct work activities as 
                appropriate designed to assist the family in achieving 
                their maximum degree of self-sufficiency, and that 
                provides for the ongoing participation of the 
                individual in the activities;</DELETED>
                <DELETED>    ``(C) require, at a minimum, each such 
                individual to participate in activities in accordance 
                with the self-sufficiency plan;</DELETED>
                <DELETED>    ``(D) monitor the participation of each 
                such individual in the activities specified in the self 
                sufficiency plan, and regularly review the progress of 
                the family toward self-sufficiency;</DELETED>
                <DELETED>    ``(E) upon such a review, revise the self-
                sufficiency plan and activities as the State deems 
                appropriate.</DELETED>
        <DELETED>    ``(2) Timing.--The State shall comply with 
        paragraph (1) with respect to a family--</DELETED>
                <DELETED>    ``(A) in the case of a family that, as of 
                October 1, 2002, is not receiving assistance from the 
                State program funded under this part, not later than 60 
                days after the family first receives assistance on the 
                basis of the most recent application for the 
                assistance; or</DELETED>
                <DELETED>    ``(B) in the case of a family that, as of 
                such date, is receiving the assistance, not later than 
                12 months after the date of enactment of this 
                subsection.</DELETED>
        <DELETED>    ``(3) State discretion.--A State shall have sole 
        discretion, consistent with section 407, to define and design 
        activities for families for purposes of this subsection, to 
        develop methods for monitoring and reviewing progress pursuant 
        to this subsection, and to make modifications to the plan as 
        the State deems appropriate to assist the individual in 
        increasing their degree of self-sufficiency.</DELETED>
        <DELETED>    ``(4) Rule of interpretation.--Nothing in this 
        part shall preclude a State from requiring participation in 
        work and any other activities the State deems appropriate for 
        helping families achieve self-sufficiency and improving child 
        well-being.''.</DELETED>
        <DELETED>    (2) Penalty for failure to establish family self-
        sufficiency plan.--Section 409(a)(3) (42 U.S.C. 609(a)(3)) is 
        amended--</DELETED>
                <DELETED>    (A) in the paragraph heading, by inserting 
                ``or establish family self-sufficiency plan'' after 
                ``rates''; and</DELETED>
                <DELETED>    (B) in subparagraph (A), by inserting ``or 
                408(b)'' after ``407(a)''.</DELETED>

<DELETED>SEC. 110. WORK PARTICIPATION REQUIREMENTS.</DELETED>

<DELETED>    (a) In General.--Section 407 (42 U.S.C. 607) is amended by 
striking all that precedes subsection (b)(3) and inserting the 
following:</DELETED>

<DELETED>``SEC. 407. WORK PARTICIPATION REQUIREMENTS.</DELETED>

<DELETED>    ``(a) Participation Rate Requirements.--A State to which a 
grant is made under section 403 for a fiscal year shall achieve a 
minimum participation rate equal to not less than--</DELETED>
        <DELETED>    ``(1) 50 percent for fiscal year 2003;</DELETED>
        <DELETED>    ``(2) 55 percent for fiscal year 2004;</DELETED>
        <DELETED>    ``(3) 60 percent for fiscal year 2005;</DELETED>
        <DELETED>    ``(4) 65 percent for fiscal year 2006; 
        and</DELETED>
        <DELETED>    ``(5) 70 percent for fiscal year 2007 and each 
        succeeding fiscal year.</DELETED>
<DELETED>    ``(b) Calculation of Participation Rates.--</DELETED>
        <DELETED>    ``(1) Average monthly rate.--For purposes of 
        subsection (a), the participation rate of a State for a fiscal 
        year is the average of the participation rates of the State for 
        each month in the fiscal year.</DELETED>
        <DELETED>    ``(2) Monthly participation rates; incorporation 
        of 40-hour work week standard.--</DELETED>
                <DELETED>    ``(A) In general.--For purposes of 
                paragraph (1), the participation rate of a State for a 
                month is--</DELETED>
                        <DELETED>    ``(i) the total number of 
                        countable hours (as defined in subsection (c)) 
                        with respect to the counted families for the 
                        State for the month; divided by</DELETED>
                        <DELETED>    ``(ii) 160 multiplied by the 
                        number of counted families for the State for 
                        the month.</DELETED>
                <DELETED>    ``(B) Counted families defined.--
                </DELETED>
                        <DELETED>    ``(i) In general.--In subparagraph 
                        (A), the term `counted family' means, with 
                        respect to a State and a month, a family that 
                        includes a work-eligible individual and that 
                        receives assistance in the month under the 
                        State program funded under this part, subject 
                        to clause (ii).</DELETED>
                        <DELETED>    ``(ii) State option to exclude 
                        certain families.--At the option of a State, 
                        the term `counted family' shall not include--
                        </DELETED>
                                <DELETED>    ``(I) a family in the 
                                first month for which the family 
                                receives assistance from a State 
                                program funded under this part on the 
                                basis of the most recent application 
                                for such assistance; or</DELETED>
                                <DELETED>    ``(II) on a case-by-case 
                                basis, a family in which the youngest 
                                child has not attained 12 months of 
                                age.</DELETED>
                        <DELETED>    ``(iii) State option to include 
                        individuals receiving assistance under a tribal 
                        family assistance plan or tribal work 
                        program.--At the option of a State, the term 
                        `counted family' may include families in the 
                        State that are receiving assistance under a 
                        tribal family assistance plan approved under 
                        section 412 or under a tribal work program to 
                        which funds are provided under this 
                        part.</DELETED>
                <DELETED>    ``(C) Work-eligible individual defined.--
                In this section, the term `work-eligible individual' 
                means an individual--</DELETED>
                        <DELETED>    ``(i) who is married or a single 
                        head of household; and</DELETED>
                        <DELETED>    ``(ii) whose needs are (or, but 
                        for sanctions under this part that have been in 
                        effect for more than 3 months (whether or not 
                        consecutive) in the preceding 12 months or 
                        under part D, would be) included in determining 
                        the amount of cash assistance to be provided to 
                        the family under the State program funded under 
                        this part.''.</DELETED>
<DELETED>    (b) Recalibration of Caseload Reduction Credit.--Section 
407(b)(3)(A)(ii) (42 U.S.C. 607(b)(3)(A)(ii)) is amended to read as 
follows:</DELETED>
                        <DELETED>    ``(ii) the average monthly number 
                        of families that received assistance under the 
                        State program funded under this part during--
                        </DELETED>
                                <DELETED>    ``(I) if the fiscal year 
                                is fiscal year 2003, fiscal year 
                                1996;</DELETED>
                                <DELETED>    ``(II) if the fiscal year 
                                is fiscal year 2004, fiscal year 
                                1998;</DELETED>
                                <DELETED>    ``(III) if the fiscal year 
                                is fiscal year 2005, fiscal year 2001; 
                                or</DELETED>
                                <DELETED>    ``(IV) if the fiscal year 
                                is fiscal year 2006 or any succeeding 
                                fiscal year, the then 4th preceding 
                                fiscal year.''.</DELETED>
<DELETED>    (c) Superachiever Credit.--Section 407(b) (42 U.S.C. 
607(b)) is amended by striking paragraphs (4) and (5) and inserting the 
following:</DELETED>
        <DELETED>    ``(4) Superachiever credit.--</DELETED>
                <DELETED>    ``(A) In general.--The participation rate, 
                determined under paragraphs (1) and (2) of this 
                subsection, of a superachiever State for a fiscal year 
                shall be increased by the lesser of--</DELETED>
                        <DELETED>    ``(i) the amount (if any) of the 
                        superachiever credit applicable to the State; 
                        or</DELETED>
                        <DELETED>    ``(ii) the number of percentage 
                        points (if any) by which the minimum 
                        participation rate required by subsection (a) 
                        for the fiscal year exceeds 50 
                        percent.</DELETED>
                <DELETED>    ``(B) Superachiever state.--For purposes 
                of subparagraph (A), a State is a superachiever State 
                if the State caseload for fiscal year 2001 has declined 
                by at least 60 percent from the State caseload for 
                fiscal year 1995.</DELETED>
                <DELETED>    ``(C) Amount of credit.--The superachiever 
                credit applicable to a State is the number of 
                percentage points (if any) by which the decline 
                referred to in subparagraph (B) exceeds 60 
                percent.</DELETED>
                <DELETED>    ``(D) Definitions.--In this 
                paragraph:</DELETED>
                        <DELETED>    ``(i) State caseload for fiscal 
                        year 2001.--The term `State caseload for fiscal 
                        year 2001' means the average monthly number of 
                        families that received assistance during fiscal 
                        year 2001 under the State program funded under 
                        this part.</DELETED>
                        <DELETED>    ``(ii) State caseload for fiscal 
                        year 1995.--The term `State caseload for fiscal 
                        year 1995' means the average monthly number of 
                        families that received aid under the State plan 
                        approved under part A (as in effect on 
                        September 30, 1995) during fiscal year 
                        1995.''.</DELETED>
<DELETED>    (d) Countable Hours.--Section 407 of such Act (42 U.S.C. 
607) is amended by striking subsections (c) and (d) and inserting the 
following:</DELETED>
<DELETED>    ``(c) Countable Hours.--</DELETED>
        <DELETED>    ``(1) Definition.--In subsection (b)(2), the term 
        `countable hours' means, with respect to a family for a month, 
        the total number of hours in the month in which any member of 
        the family who is a work-eligible individual is engaged in a 
        direct work activity or other activities specified by the State 
        (excluding an activity that does not address a purpose 
        specified in section 401(a)), subject to the other provisions 
        of this subsection.</DELETED>
        <DELETED>    ``(2) Limitations.--Subject to such regulations as 
        the Secretary may prescribe:</DELETED>
                <DELETED>    ``(A) Minimum weekly average of 24 hours 
                of direct work activities required.--If the work-
                eligible individuals in a family are engaged in a 
                direct work activity for an average total of fewer than 
                24 hours per week in a month, then the number of 
                countable hours with respect to the family for the 
                month shall be zero.</DELETED>
                <DELETED>    ``(B) Maximum weekly average of 16 hours 
                of other activities.--An average of not more than 16 
                hours per week of activities specified by the State 
                (subject to the exclusion described in paragraph (1)) 
                may be considered countable hours in a month with 
                respect to a family.</DELETED>
        <DELETED>    ``(3) Special rules.--For purposes of paragraph 
        (1):</DELETED>
                <DELETED>    ``(A) Participation in qualified 
                activities.--</DELETED>
                        <DELETED>    ``(i) In general.--If, with the 
                        approval of the State, the work-eligible 
                        individuals in a family are engaged in 1 or 
                        more qualified activities for an average total 
                        of at least 24 hours per week in a month, then 
                        all such engagement in the month shall be 
                        considered engagement in a direct work 
                        activity, subject to clause (iii).</DELETED>
                        <DELETED>    ``(ii) Qualified activity 
                        defined.--The term `qualified activity' means 
                        an activity specified by the State (subject to 
                        the exclusion described in paragraph (1)) that 
                        meets such standards and criteria as the State 
                        may specify, including--</DELETED>
                                <DELETED>    ``(I) substance abuse 
                                counseling or treatment;</DELETED>
                                <DELETED>    ``(II) rehabilitation 
                                treatment and services;</DELETED>
                                <DELETED>    ``(III) work-related 
                                education or training directed at 
                                enabling the family member to 
                                work;</DELETED>
                                <DELETED>    ``(IV) job search or job 
                                readiness assistance; and</DELETED>
                                <DELETED>    ``(V) any other activity 
                                that addresses a purpose specified in 
                                section 401(a).</DELETED>
                        <DELETED>    ``(iii) Limitation.--</DELETED>
                                <DELETED>    ``(I) In general.--Except 
                                as provided in subclause (II), clause 
                                (i) shall not apply to a family for 
                                more than 3 months in any period of 24 
                                consecutive months.</DELETED>
                                <DELETED>    ``(II) Special rule 
                                applicable to education and training.--
                                A State may, on a case-by-case basis, 
                                apply clause (i) to a work-eligible 
                                individual so that participation by the 
                                individual in education or training, if 
                                needed to permit the individual to 
                                complete a certificate program or other 
                                work-related education or training 
                                directed at enabling the individual to 
                                fill a known job need in a local area, 
                                may be considered countable hours with 
                                respect to the family of the individual 
                                for not more than 4 months in any 
                                period of 24 consecutive 
                                months.</DELETED>
                <DELETED>    ``(B) School attendance by teen head of 
                household.--The work-eligible members of a family shall 
                be considered to be engaged in a direct work activity 
                for an average of 40 hours per week in a month if the 
                family includes an individual who is married, or is a 
                single head of household, who has not attained 20 years 
                of age, and the individual--</DELETED>
                        <DELETED>    ``(i) maintains satisfactory 
                        attendance at secondary school or the 
                        equivalent in the month; or</DELETED>
                        <DELETED>    ``(ii) participates in education 
                        directly related to employment for an average 
                        of at least 20 hours per week in the 
                        month.</DELETED>
<DELETED>    ``(d) Direct Work Activity.--In this section, the term 
`direct work activity' means--</DELETED>
        <DELETED>    ``(1) unsubsidized employment;</DELETED>
        <DELETED>    ``(2) subsidized private sector 
        employment;</DELETED>
        <DELETED>    ``(3) subsidized public sector 
        employment;</DELETED>
        <DELETED>    ``(4) on-the-job training;</DELETED>
        <DELETED>    ``(5) supervised work experience; or</DELETED>
        <DELETED>    ``(6) supervised community service.''.</DELETED>
<DELETED>    (e) Penalties Against Individuals.--Section 407(e)(1) (42 
U.S.C. 607(e)(1)) is amended to read as follows:</DELETED>
        <DELETED>    ``(1) Reduction or termination of assistance.--
        </DELETED>
                <DELETED>    ``(A) In general.--Except as provided in 
                paragraph (2), if an individual in a family receiving 
                assistance under a State program funded under this part 
                fails to engage in activities required in accordance 
                with this section, or other activities required by the 
                State under the program, and the family does not 
                otherwise engage in activities in accordance with the 
                self-sufficiency plan established for the family 
                pursuant to section 408(b), the State shall--</DELETED>
                        <DELETED>    ``(i) if the failure is partial or 
                        persists for not more than 1 month--</DELETED>
                                <DELETED>    ``(I) reduce the amount of 
                                assistance otherwise payable to the 
                                family pro rata (or more, at the option 
                                of the State) with respect to any 
                                period during a month in which the 
                                failure occurs; or</DELETED>
                                <DELETED>    ``(II) terminate all 
                                assistance to the family, subject to 
                                such good cause exceptions as the State 
                                may establish; or</DELETED>
                        <DELETED>    ``(ii) if the failure is total and 
                        persists for at least 2 consecutive months, 
                        terminate all cash payments to the family 
                        including qualified State expenditures (as 
                        defined in section 409(a)(7)(B)(i)) for at 
                        least 1 month and thereafter until the State 
                        determines that the individual has resumed full 
                        participation in the activities, subject to 
                        such good cause exceptions as the State may 
                        establish.</DELETED>
                <DELETED>    ``(B) Special rule.--In the event of a 
                conflict between a requirement of clause (i)(II) or 
                (ii) of subparagraph (A) and a requirement of a State 
                constitution, or of a State statute that, before 1966, 
                obligated local government to provide assistance to 
                needy parents and children, the State constitutional or 
                statutory requirement shall control.''.</DELETED>
<DELETED>    (f) Conforming Amendments.--</DELETED>
        <DELETED>    (1) Section 407(f) (42 U.S.C. 607(f)) is amended 
        in each of paragraphs (1) and (2) by striking ``work activity 
        described in subsection (d)'' and inserting ``direct work 
        activity''.</DELETED>
        <DELETED>    (2) The heading of section 409(a)(14) (42 U.S.C. 
        609(a)(14)) is amended by inserting ``or refusing to engage in 
        activities under a family self-sufficiency plan'' after 
        ``work''.</DELETED>

<DELETED>SEC. 111. MAINTENANCE OF EFFORT.</DELETED>

<DELETED>    (a) In General.--Section 409(a)(7) (42 U.S.C. 609(a)(7)) 
is amended--</DELETED>
        <DELETED>    (1) in subparagraph (A) by striking ``fiscal year 
        1998, 1999, 2000, 2001, 2002, or 2003'' and inserting ``fiscal 
        year 2003, 2004, 2005, 2006, 2007 or 2008''; and</DELETED>
        <DELETED>    (2) in subparagraph (B)(ii)--</DELETED>
                <DELETED>    (A) by inserting ``preceding'' before 
                ``fiscal year''; and</DELETED>
                <DELETED>    (B) by striking ``for fiscal years 1997 
                through 2002,''.</DELETED>
<DELETED>    (b) State Spending on Promoting Healthy Marriage.--
</DELETED>
        <DELETED>    (1) In general.--Section 404 (42 U.S.C. 604) is 
        amended by adding at the end the following:</DELETED>
<DELETED>    ``(l) Marriage Promotion.--A State, territory, or tribal 
organization to which a grant is made under section 403(a)(2) may use a 
grant made to the State, territory, or tribal organization under any 
other provision of section 403 for marriage promotion activities, and 
the amount of any such grant so used shall be considered State funds 
for purposes of section 403(a)(2).''.</DELETED>
        <DELETED>    (2) Federal tanf funds used for marriage promotion 
        disregarded for purposes of maintenance of effort 
        requirement.--Section 409(a)(7)(B)(i) (42 U.S.C. 
        609(a)(7)(B)(i)), as amended by section 103(c) of this Act, is 
        amended by adding at the end the following:</DELETED>
                                <DELETED>    ``(VI) Exclusion of 
                                federal tanf funds used for marriage 
                                promotion activities.--Such term does 
                                not include the amount of any grant 
                                made to the State under section 403 
                                that is expended for a marriage 
                                promotion activity.''.</DELETED>

<DELETED>SEC. 112. PERFORMANCE IMPROVEMENT.</DELETED>

<DELETED>    (a) State Plans.--Section 402(a) (42 U.S.C. 602(a)) is 
amended--</DELETED>
        <DELETED>    (1) in paragraph (1)--</DELETED>
                <DELETED>    (A) in subparagraph (A)--</DELETED>
                        <DELETED>    (i) by redesignating clause (vi) 
                        and clause (vii) (as added by section 103(a) of 
                        this Act) as clauses (vii) and (viii), 
                        respectively; and</DELETED>
                        <DELETED>    (ii) by striking clause (v) and 
                        inserting the following:</DELETED>
                        <DELETED>    ``(v) The document shall--
                        </DELETED>
                                <DELETED>    ``(I) describe how the 
                                State will pursue ending dependence of 
                                needy families on government benefits 
                                and reducing poverty by promoting job 
                                preparation and work;</DELETED>
                                <DELETED>    ``(II) describe how the 
                                State will encourage the formation and 
                                maintenance of healthy 2-parent married 
                                families, encourage responsible 
                                fatherhood, and prevent and reduce the 
                                incidence of out-of-wedlock 
                                pregnancies;</DELETED>
                                <DELETED>    ``(III) include specific, 
                                numerical, and measurable performance 
                                objectives for accomplishing subclauses 
                                (I) and (II), and with respect to 
                                subclause (I), include objectives 
                                consistent with the criteria used by 
                                the Secretary in establishing 
                                performance targets under section 
                                403(a)(4)(B) if available; 
                                and</DELETED>
                                <DELETED>    ``(IV) describe the 
                                methodology that the State will use to 
                                measure State performance in relation 
                                to each such objective.</DELETED>
                        <DELETED>    ``(vi) Describe any strategies and 
                        programs the State may be undertaking to 
                        address--</DELETED>
                                <DELETED>    ``(I) employment retention 
                                and advancement for recipients of 
                                assistance under the program, including 
                                placement into high-demand jobs, and 
                                whether the jobs are identified using 
                                labor market information;</DELETED>
                                <DELETED>    ``(II) efforts to reduce 
                                teen pregnancy;</DELETED>
                                <DELETED>    ``(III) services for 
                                struggling and noncompliant families, 
                                and for clients with special problems; 
                                and</DELETED>
                                <DELETED>    ``(IV) program 
                                integration, including the extent to 
                                which employment and training services 
                                under the program are provided through 
                                the One-Stop delivery system created 
                                under the Workforce Investment Act of 
                                1998, and the extent to which former 
                                recipients of such assistance have 
                                access to additional core, intensive, 
                                or training services funded through 
                                such Act.''; and</DELETED>
                <DELETED>    (B) in subparagraph (B), by striking 
                clause (iii) (as so redesignated by section 107(b)(1) 
                of this Act) and inserting the following:</DELETED>
                        <DELETED>    ``(iii) The document shall 
                        describe strategies and programs the State is 
                        undertaking to engage religious organizations 
                        in the provision of services funded under this 
                        part and efforts related to section 104 of the 
                        Personal Responsibility and Work Opportunity 
                        Reconcilation Act of 1996.</DELETED>
                        <DELETED>    ``(iv) The document shall describe 
                        strategies to improve program management and 
                        performance.''; and</DELETED>
        <DELETED>    (2) in paragraph (4), by inserting ``and tribal'' 
        after ``that local''.</DELETED>
<DELETED>    (b) Consultation With State Regarding Plan and Design of 
Tribal Programs.--Section 412(b)(1) (42 U.S.C. 612(b)(1)) is amended--
</DELETED>
        <DELETED>    (1) by striking ``and'' at the end of subparagraph 
        (E);</DELETED>
        <DELETED>    (2) by striking the period at the end of 
        subparagraph (F) and inserting ``; and''; and</DELETED>
        <DELETED>    (3) by adding at the end the following:</DELETED>
                <DELETED>    ``(G) provides an assurance that the State 
                in which the tribe is located has been consulted 
                regarding the plan and its design.''.</DELETED>
<DELETED>    (c) Performance Measures.--Section 413 (42 U.S.C. 613) is 
amended by adding at the end the following:</DELETED>
<DELETED>    ``(k) Performance Improvement.--The Secretary, in 
consultation with the States, shall develop uniform performance 
measures designed to assess the degree of effectiveness, and the degree 
of improvement, of State programs funded under this part in 
accomplishing the purposes of this part.''.</DELETED>
<DELETED>    (d) Annual Ranking of States.--Section 413(d)(1) (42 
U.S.C. 613(d)(1)) is amended by striking ``long-term private sector 
jobs'' and inserting ``private sector jobs, the success of the 
recipients in retaining employment, the ability of the recipients to 
increase their wages''.</DELETED>

<DELETED>SEC. 113. DATA COLLECTION AND REPORTING.</DELETED>

<DELETED>    (a) Contents of Report.-- Section 411(a)(1)(A) (42 U.S.C. 
611(a)(1)(A)) is amended--</DELETED>
        <DELETED>    (1) in clause (vii), by inserting ``and minor 
        parent'' after ``of each adult'';</DELETED>
        <DELETED>    (2) in clause (viii), by striking ``and 
        educational level'';</DELETED>
        <DELETED>    (3) in clause (ix), by striking ``, and if the 
        latter 2, the amount received'';</DELETED>
        <DELETED>    (4) in clause (x)--</DELETED>
                <DELETED>    (A) by striking ``each type of''; 
                and</DELETED>
                <DELETED>    (B) by inserting before the period ``and, 
                if applicable, the reason for receipt of the assistance 
                for a total of more than 60 months'';</DELETED>
        <DELETED>    (5) in clause (xi), by striking the subclauses and 
        inserting the following:</DELETED>
                                <DELETED>    ``(I) Subsidized private 
                                sector employment.</DELETED>
                                <DELETED>    ``(II) Unsubsidized 
                                employment.</DELETED>
                                <DELETED>    ``(III) Public sector 
                                employment, supervised work experience, 
                                or supervised community 
                                service.</DELETED>
                                <DELETED>    ``(IV) On-the-job 
                                training.</DELETED>
                                <DELETED>    ``(V) Job search and 
                                placement.</DELETED>
                                <DELETED>    ``(VI) Training.</DELETED>
                                <DELETED>    ``(VII) 
                                Education.</DELETED>
                                <DELETED>    ``(VIII) Other activities 
                                directed at the purposes of this part, 
                                as specified in the State plan 
                                submitted pursuant to section 
                                402.'';</DELETED>
        <DELETED>    (6) in clause (xii), by inserting ``and progress 
        toward universal engagement'' after ``participation 
        rates'';</DELETED>
        <DELETED>    (7) in clause (xiii), by striking ``type and'' 
        before ``amount of assistance'';</DELETED>
        <DELETED>    (8) in clause (xvi), by striking subclause (II) 
        and redesignating subclauses (III) through (V) as subclauses 
        (II) through (IV), respectively; and</DELETED>
        <DELETED>    (9) by adding at the end the following:</DELETED>
                        <DELETED>    ``(xviii) The date the family 
                        first received assistance from the State 
                        program on the basis of the most recent 
                        application for such assistance.</DELETED>
                        <DELETED>    ``(xix) Whether a self-sufficiency 
                        plan is established for the family in 
                        accordance with section 408(b).</DELETED>
                        <DELETED>    ``(xx) With respect to any child 
                        in the family, the marital status of the 
                        parents at the birth of the child, and if the 
                        parents were not then married, whether the 
                        paternity of the child has been 
                        established.''.</DELETED>
<DELETED>    (b) Use of Samples.--Section 411(a)(1)(B) (42 U.S.C. 
611(a)(1)(B)) is amended--</DELETED>
        <DELETED>    (1) in clause (i)--</DELETED>
                <DELETED>    (A) by striking ``a sample'' and inserting 
                ``samples''; and</DELETED>
                <DELETED>    (B) by inserting before the period ``, 
                except that the Secretary may designate core data 
                elements that must be reported on all families''; 
                and</DELETED>
        <DELETED>    (2) in clause (ii), by striking ``funded under 
        this part'' and inserting ``described in subparagraph 
        (A)''.</DELETED>
<DELETED>    (c) Report on Families That Become Ineligible To Receive 
Assistance.--Section 411(a) (42 U.S.C. 611(a)) is amended--</DELETED>
        <DELETED>    (1) by striking paragraph (5);</DELETED>
        <DELETED>    (2) by redesignating paragraph (6) as paragraph 
        (5); and</DELETED>
        <DELETED>    (3) by inserting after paragraph (5) (as so 
        redesignated) the following:</DELETED>
        <DELETED>    ``(6) Report on families that become ineligible to 
        receive assistance.--The report required by paragraph (1) for a 
        fiscal quarter shall include for each month in the quarter the 
        number of families and total number of individuals that, during 
        the month, became ineligible to receive assistance under the 
        State program funded under this part (broken down by the number 
        of families that become so ineligible due to earnings, changes 
        in family composition that result in increased earnings, 
        sanctions, time limits, or other specified 
        reasons).''.</DELETED>
<DELETED>    (d) Regulations.--Section 411(a)(7) (42 U.S.C. 611(a)(7)) 
is amended--</DELETED>
        <DELETED>    (1) by inserting ``and to collect the necessary 
        data'' before ``with respect to which reports'';</DELETED>
        <DELETED>    (2) by striking ``subsection'' and inserting 
        ``section''; and</DELETED>
        <DELETED>    (3) by striking ``in defining the data elements'' 
        and all that follows and inserting ``, the National Governors' 
        Association, the American Public Human Services Association, 
        the National Conference of State Legislatures, and others in 
        defining the data elements.''.</DELETED>
<DELETED>    (e) Additional Reports by States.--Section 411 (42 U.S.C. 
611) is amended--</DELETED>
        <DELETED>    (1) by redesignating subsection (b) as subsection 
        (e); and</DELETED>
        <DELETED>    (2) by inserting after subsection (a) the 
        following:</DELETED>
<DELETED>    ``(b) Annual Reports on Program Characteristics.--Not 
later than 90 days after the end of fiscal year 2004 and each 
succeeding fiscal year, each eligible State shall submit to the 
Secretary a report on the characteristics of the State program funded 
under this part and other State programs funded with qualified State 
expenditures (as defined in section 409(a)(7)(B)(i)). The report shall 
include, with respect to each such program, the program name, a 
description of program activities, the program purpose, the program 
eligibility criteria, the sources of program funding, the number of 
program beneficiaries, sanction policies, and any program work 
requirements.</DELETED>
<DELETED>    ``(c) Monthly Reports on Caseload.--Not later than 3 
months after the end of a calendar month that begins 1 year or more 
after the enactment of this subsection, each eligible State shall 
submit to the Secretary report on the number of families and total 
number of individuals receiving assistance in the calendar month under 
the State program funded under this part.</DELETED>
<DELETED>    ``(d) Annual Report on Performance Improvement.--Beginning 
with fiscal year 2004, not later than January 1 of each fiscal year, 
each eligible State shall submit to the Secretary a report on 
achievement and improvement during the preceding fiscal year under the 
numerical performance goals and measures under the State program funded 
under this part with respect to each of the matters described in 
section 402(a)(1)(A)(v).''.</DELETED>
<DELETED>    (f) Annual Reports to Congress by the Secretary.--Section 
411(e), as so redesignated by subsection (e) of this section, is 
amended--</DELETED>
        <DELETED>    (1) in the matter preceding paragraph (1), by 
        striking ``and each fiscal year thereafter'' and inserting 
        ``and by July 1 of each fiscal year thereafter'';</DELETED>
        <DELETED>    (2) in paragraph (2), by striking ``families 
        applying for assistance,'' and by striking the last comma; 
        and</DELETED>
        <DELETED>    (3) in paragraph (3), by inserting ``and other 
        programs funded with qualified State expenditures (as defined 
        in section 409(a)(7)(B)(i))'' before the semicolon.</DELETED>
<DELETED>    (g) Increased Analysis of State Single Audit Reports.--
Section 411 (42 U.S.C. 611) is amended by adding at the end the 
following:</DELETED>
<DELETED>    ``(f) Increased Analysis of State Single Audit Reports.--
</DELETED>
        <DELETED>    ``(1) In general.--Within 3 months after a State 
        submits to the Secretary a report pursuant to section 
        7502(a)(1)(A) of title 31, United States Code, the Secretary 
        shall analyze the report for the purpose of identifying the 
        extent and nature of problems related to the oversight by the 
        State of nongovernmental entities with respect to contracts 
        entered into by such entities with the State program funded 
        under this part, and determining what additional actions may be 
        appropriate to help prevent and correct the problems.</DELETED>
        <DELETED>    ``(2) Inclusion of program oversight section in 
        annual report to the congress.--The Secretary shall include in 
        each report under subsection (a) a section on oversight of 
        State programs funded under this part, including findings on 
        the extent and nature of the problems referred to in paragraph 
        (1), actions taken to resolve the problems, and to the extent 
        the Secretary deems appropriate make recommendations on changes 
        needed to resolve the problems.''.</DELETED>

<DELETED>SEC. 114. DIRECT FUNDING AND ADMINISTRATION BY INDIAN 
              TRIBES.</DELETED>

<DELETED>    (a) Tribal Family Assistance Grant.--Section 412(a)(1)(A) 
(42 U.S.C. 612(a)(1)(A)) is amended by striking ``1997, 1998, 1999, 
2000, 2001, and 2002'' and inserting ``2003 through 2007''.</DELETED>
<DELETED>    (b) Grants for Indian Tribes That Received JOBS funds.--
Section 412(a)(2)(A) (42 U.S.C. 612(a)(2)(A)) is amended by striking 
``1997, 1998, 1999, 2000, 2001, and 2002'' and inserting ``2003 through 
2007''.</DELETED>

<DELETED>SEC. 115. RESEARCH, EVALUATIONS, AND NATIONAL 
              STUDIES.</DELETED>

<DELETED>    (a) Secretary's Fund for Research, Demonstrations, and 
Technical Assistance.--Section 413 (42 U.S.C. 613), as amended by 
section 112(c) of this Act, is further amended by adding at the end the 
following:</DELETED>
<DELETED>    ``(l) Funding for Research, Demonstrations, and Technical 
Assistance.--</DELETED>
        <DELETED>    ``(1) In general.--Out of any money in the 
        Treasury of the United States not otherwise appropriated, there 
        are appropriated $102,000,000 for each of fiscal years 2003 
        through 2007, which shall be available to the Secretary for the 
        purpose of conducting and supporting research and demonstration 
        projects by public or private entities, and providing technical 
        assistance to States, Indian tribal organizations, and such 
        other entities as the Secretary may specify that are receiving 
        a grant under this part, which shall be expended primarily on 
        activities described in section 403(a)(2)(B), and which shall 
        be in addition to any other funds made available under this 
        part.</DELETED>
        <DELETED>    ``(2) Set aside for demonstration projects for 
        coordination of provision of child welfare and tanf services to 
        tribal families at risk of child abuse or neglect.--</DELETED>
                <DELETED>    ``(A) In general.--Of the amounts made 
                available under paragraph (1) for a fiscal year, 
                $2,000,000 shall be awarded on a competitive basis to 
                fund demonstration projects designed to test the 
                effectiveness of tribal governments or tribal consortia 
                in coordinating the provision to tribal families at 
                risk of child abuse or neglect of child welfare 
                services and services under tribal programs funded 
                under this part.</DELETED>
                <DELETED>    ``(B) Use of funds.--A grant made to such 
                a project shall be used--</DELETED>
                        <DELETED>    ``(i) to improve case management 
                        for families eligible for assistance from such 
                        a tribal program;</DELETED>
                        <DELETED>    ``(ii) for supportive services and 
                        assistance to tribal children in out-of-home 
                        placements and the tribal families caring for 
                        such children, including families who adopt 
                        such children; and</DELETED>
                        <DELETED>    ``(iii) for prevention services 
                        and assistance to tribal families at risk of 
                        child abuse and neglect.</DELETED>
                <DELETED>    ``(C) Reports.--The Secretary may require 
                a recipient of funds awarded under this paragraph to 
                provide the Secretary with such information as the 
                Secretary deems relevant to enable the Secretary to 
                facilitate and oversee the administration of any 
                project for which funds are provided under this 
                paragraph.''.</DELETED>
<DELETED>    (b) Funding of Studies and Demonstrations.--Section 
413(h)(1) (42 U.S.C. 613(h)(1)) is amended in the matter preceding 
subparagraph (A) by striking ``1997 through 2002'' and inserting ``2003 
through 2007''.</DELETED>
<DELETED>    (c) Report on Enforcement of Certain Affidavits of Support 
and Sponsor Deeming.--Not later than March 31, 2004, the Secretary of 
Health and Human Services, in consultation with the Attorney General, 
shall submit to the Congress a report on the enforcement of affidavits 
of support and sponsor deeming as required by section 421, 422, and 432 
of the Personal Responsibility and Work Opportunity Reconciliation Act 
of 1996.</DELETED>
<DELETED>    (d) Report on Coordination.--Not later than 6 months after 
the date of the enactment of this Act, the Secretary of Health and 
Human Services and the Secretary of Labor shall jointly submit a report 
to the Congress describing common or conflicting data elements, 
definitions, performance measures, and reporting requirements in the 
Workforce Investment Act of 1998 and part A of title IV of the Social 
Security Act, and, to the degree each Secretary deems appropriate, at 
the discretion of either Secretary, any other program administered by 
the respective Secretary, to allow greater coordination between the 
welfare and workforce development systems.</DELETED>

<DELETED>SEC. 116. STUDIES BY THE CENSUS BUREAU AND THE GENERAL 
              ACCOUNTING OFFICE.</DELETED>

<DELETED>    (a) Census Bureau Study.--</DELETED>
        <DELETED>    (1) In general.--Section 414(a) (42 U.S.C. 614(a)) 
        is amended to read as follows:</DELETED>
<DELETED>    ``(a) In General.--The Bureau of the Census shall 
implement a new longitudinal survey of program dynamics, developed in 
consultation with the Secretary and made available to interested 
parties, to allow for the assessment of the outcomes of continued 
welfare reform on the economic and child well-being of low-income 
families with children, including those who received assistance or 
services from a State program funded under this part, and, to the 
extent possible, shall provide State representative samples. The 
content of the survey should include such information as may be 
necessary to examine the issues of out-of-wedlock childbearing, 
marriage, welfare dependency and compliance with work requirements, the 
beginning and ending of spells of assistance, work, earnings and 
employment stability, and the well-being of children.''.</DELETED>
        <DELETED>    (2) Appropriation.--Section 414(b) (42 U.S.C. 
        614(b)) is amended by striking ``1996,'' and all that follows 
        through ``2002'' and inserting ``2003 through 2007''.</DELETED>
<DELETED>    (b) GAO Study.--</DELETED>
        <DELETED>    (1) In general.--The Comptroller General of the 
        United States shall conduct a study to determine the combined 
        effect of the phase-out rates for Federal programs and policies 
        which provide support to low-income families and individuals as 
        they move from welfare to work, at all earning levels up to 
        $35,000 per year, for at least 5 States including Wisconsin and 
        California, and any potential disincentives the combined phase-
        out rates create for families to achieve independence or to 
        marry.</DELETED>
        <DELETED>    (2) Report.--Not later than 1 year after the date 
        of the enactment of this subsection, the Comptroller General 
        shall submit a report to Congress containing the results of the 
        study conducted under this section and, as appropriate, any 
        recommendations consistent with the results.</DELETED>

<DELETED>SEC. 117. DEFINITION OF ASSISTANCE.</DELETED>

<DELETED>    (a) In General.--Section 419 (42 U.S.C. 619) is amended by 
adding at the end the following:</DELETED>
        <DELETED>    ``(6) Assistance.--</DELETED>
                <DELETED>    ``(A) In general.--The term `assistance' 
                means payment, by cash, voucher, or other means, to or 
                for an individual or family for the purpose of meeting 
                a subsistence need of the individual or family 
                (including food, clothing, shelter, and related items, 
                but not including costs of transportation or child 
                care).</DELETED>
                <DELETED>    ``(B) Exception.--The term `assistance' 
                does not include a payment described in subparagraph 
                (A) to or for an individual or family on a short-term, 
                nonrecurring basis (as defined by the State in 
                accordance with regulations prescribed by the 
                Secretary).''.</DELETED>
<DELETED>    (b) Conforming Amendments.--</DELETED>
        <DELETED>    (1) Section 404(a)(1) (42 U.S.C. 604(a)(1)) is 
        amended by striking ``assistance'' and inserting 
        ``aid''.</DELETED>
        <DELETED>    (2) Section 404(f) (42 U.S.C. 604(f)) is amended 
        by striking ``assistance'' and inserting ``benefits or 
        services''.</DELETED>
        <DELETED>    (3) Section 408(a)(5)(B)(i) (42 U.S.C. 
        608(a)(5)(B)(i)) is amended in the heading by striking 
        ``assistance'' and inserting ``aid''.</DELETED>
        <DELETED>    (4) Section 413(d)(2) (42 U.S.C. 613(d)(2)) is 
        amended by striking ``assistance'' and inserting 
        ``aid''.</DELETED>

<DELETED>SEC. 118. TECHNICAL CORRECTIONS.</DELETED>

<DELETED>    (a) Section 409(c)(2) (42 U.S.C. 609(c)(2)) is amended by 
inserting a comma after ``appropriate''.</DELETED>
<DELETED>    (b) Section 411(a)(1)(A)(ii)(III) (42 U.S.C. 
611(a)(1)(A)(ii)(III)) is amended by striking the last close 
parenthesis.</DELETED>
<DELETED>    (c) Section 413(j)(2)(A) (42 U.S.C. 613(j)(2)(A)) is 
amended by striking ``section'' and inserting ``sections''.</DELETED>
<DELETED>    (d)(1) Section 413 (42 U.S.C. 613) is amended by striking 
subsection (g) and redesignating subsections (h) through (j) and 
subsections (k) and (l) (as added by sections 112(c) and 115(a) of this 
Act, respectively) as subsections (g) through (k), 
respectively.</DELETED>
<DELETED>    (2) Each of the following provisions is amended by 
striking ``413(j)'' and inserting ``413(i)'':</DELETED>
        <DELETED>    (A) Section 403(a)(5)(A)(ii)(III) (42 U.S.C. 
        603(a)(5)(A)(ii)(III)).</DELETED>
        <DELETED>    (B) Section 403(a)(5)(F) (42 U.S.C. 
        603(a)(5)(F)).</DELETED>
        <DELETED>    (C) Section 403(a)(5)(G)(ii) (42 U.S.C. 
        603(a)(5)(G)(ii)).</DELETED>
        <DELETED>    (D) Section 412(a)(3)(B)(iv) (42 U.S.C. 
        612(a)(3)(B)(iv)).</DELETED>

<DELETED>SEC. 119. FATHERHOOD PROGRAM.</DELETED>

<DELETED>    (a) Short Title.--This section may be cited as the 
``Promotion and Support of Responsible Fatherhood and Healthy Marriage 
Act of 2002''.</DELETED>
<DELETED>    (b) Fatherhood Program.--</DELETED>
        <DELETED>    (1) In general.--Title I of the Personal 
        Responsibility and Work Opportunity Reconciliation Act of 1996 
        (Public Law 104-193) is amended by adding at the end the 
        following:</DELETED>

<DELETED>``SEC. 117. FATHERHOOD PROGRAM.</DELETED>

<DELETED>    ``(a) In General.--Title IV (42 U.S.C. 601-679b) is 
amended by inserting after part B the following:</DELETED>

             <DELETED>`PART C--FATHERHOOD PROGRAM</DELETED>

<DELETED>`SEC. 441. FINDINGS AND PURPOSES.</DELETED>

<DELETED>    `(a) Findings.--The Congress finds that there is 
substantial evidence strongly indicating the urgent need to promote and 
support involved, committed, and responsible fatherhood, and to 
encourage and support healthy marriages between parents raising 
children, including data demonstrating the following:</DELETED>
        <DELETED>    `(1) In approximately 90 percent of cases where a 
        parent is absent, that parent is the father.</DELETED>
        <DELETED>    `(2) By some estimates, 60 percent of children 
        born in the 1990's will spend a significant portion of their 
        childhood in a home without a father.</DELETED>
        <DELETED>    `(3) Nearly 75 percent of children in single-
        parent homes will experience poverty before they are 11 years 
        old, compared with only 20 percent of children in 2-parent 
        families.</DELETED>
        <DELETED>    `(4) Low income is positively correlated with 
        children's difficulties with education, social adjustment, and 
        delinquency, and single-parent households constitute a 
        disproportionate share of low-income households.</DELETED>
        <DELETED>    `(5) Where families (whether intact or with a 
        parent absent) are living in poverty, a significant factor is 
        the father's lack of job skills.</DELETED>
        <DELETED>    `(6) Children raised in 2-parent married families, 
        on average, fare better as a group in key areas, including 
        better school performance, reduced rates of substance abuse, 
        crime, and delinquency, fewer health, emotional, and behavioral 
        problems, lower rates of teenage sexual activity, less risk of 
        abuse or neglect, and lower risk of teen suicide.</DELETED>
        <DELETED>    `(7) Committed and responsible fathering during 
        infancy and early childhood contributes to the development of 
        emotional security, curiosity, and math and verbal 
        skills.</DELETED>
        <DELETED>    `(8) An estimated 24,000,000 children (33.5 
        percent) live apart from their biological father.</DELETED>
        <DELETED>    `(9) A recent national survey indicates that of 
        all children under age 18 not living with their biological 
        father, 29 percent had not seen their father even once in the 
        last 12 months.</DELETED>
<DELETED>    `(b) Purposes.--The purposes of this part are:</DELETED>
        <DELETED>    `(1) To provide for projects and activities by 
        public entities and by nonprofit community entities, including 
        religious organizations, designed to test promising approaches 
        to accomplishing the following objectives:</DELETED>
                <DELETED>    `(A) Promoting responsible, caring, and 
                effective parenting through counseling, mentoring, and 
                parenting education, dissemination of educational 
                materials and information on parenting skills, 
                encouragement of positive father involvement, including 
                the positive involvement of nonresident fathers, and 
                other methods.</DELETED>
                <DELETED>    `(B) Enhancing the abilities and 
                commitment of unemployed or low-income fathers to 
                provide material support for their families and to 
                avoid or leave welfare programs by assisting them to 
                take full advantage of education, job training, and job 
                search programs, to improve work habits and work 
                skills, to secure career advancement by activities such 
                as outreach and information dissemination, 
                coordination, as appropriate, with employment services 
                and job training programs, including the One-Stop 
                delivery system established under title I of the 
                Workforce Investment Act of 1998, encouragement and 
                support of timely payment of current child support and 
                regular payment toward past due child support 
                obligations in appropriate cases, and other 
                methods.</DELETED>
                <DELETED>    `(C) Improving fathers' ability to 
                effectively manage family business affairs by means 
                such as education, counseling, and mentoring in matters 
                including household management, budgeting, banking, and 
                handling of financial transactions, time management, 
                and home maintenance.</DELETED>
                <DELETED>    `(D) Encouraging and supporting healthy 
                marriages and married fatherhood through such 
                activities as premarital education, including the use 
                of premarital inventories, marriage preparation 
                programs, skills-based marriage education programs, 
                marital therapy, couples counseling, divorce education 
                and reduction programs, divorce mediation and 
                counseling, relationship skills enhancement programs, 
                including those designed to reduce child abuse and 
                domestic violence, and dissemination of information 
                about the benefits of marriage for both parents and 
                children.</DELETED>
        <DELETED>    `(2) Through the projects and activities described 
        in paragraph (1), to improve outcomes for children with respect 
        to measures such as increased family income and economic 
        security, improved school performance, better health, improved 
        emotional and behavioral stability and social adjustment, and 
        reduced risk of delinquency, crime, substance abuse, child 
        abuse and neglect, teen sexual activity, and teen 
        suicide.</DELETED>
        <DELETED>    `(3) To evaluate the effectiveness of various 
        approaches and to disseminate findings concerning outcomes and 
        other information in order to encourage and facilitate the 
        replication of effective approaches to accomplishing these 
        objectives.</DELETED>

<DELETED>`SEC. 442. DEFINITIONS.</DELETED>

<DELETED>    `In this part, the terms ``Indian tribe'' and ``tribal 
organization'' have the meanings given them in subsections (e) and (l), 
respectively, of section 4 of the Indian Self-Determination and 
Education Assistance Act.</DELETED>

<DELETED>`SEC. 443. COMPETITIVE GRANTS FOR SERVICE PROJECTS.</DELETED>

<DELETED>    `(a) In General.--The Secretary may make grants for fiscal 
years 2003 through 2007 to public and nonprofit community entities, 
including religious organizations, and to Indian tribes and tribal 
organizations, for demonstration service projects and activities 
designed to test the effectiveness of various approaches to accomplish 
the objectives specified in section 441(b)(1).</DELETED>
<DELETED>    `(b) Eligibility Criteria for Full Service Grants.--In 
order to be eligible for a grant under this section, except as 
specified in subsection (c), an entity shall submit an application to 
the Secretary containing the following:</DELETED>
        <DELETED>    `(1) Project description.--A statement including--
        </DELETED>
                <DELETED>    `(A) a description of the project and how 
                it will be carried out, including the geographical area 
                to be covered and the number and characteristics of 
                clients to be served, and how it will address each of 
                the 4 objectives specified in section 441(b)(1); 
                and</DELETED>
                <DELETED>    `(B) a description of the methods to be 
                used by the entity or its contractor to assess the 
                extent to which the project was successful in 
                accomplishing its specific objectives and the general 
                objectives specified in section 441(b)(1).</DELETED>
        <DELETED>    `(2) Experience and qualifications.--A 
        demonstration of ability to carry out the project, by means 
        such as demonstration of experience in successfully carrying 
        out projects of similar design and scope, and such other 
        information as the Secretary may find necessary to demonstrate 
        the entity's capacity to carry out the project, including the 
        entity's ability to provide the non-Federal share of project 
        resources.</DELETED>
        <DELETED>    `(3) Addressing child abuse and neglect and 
        domestic violence.--A description of how the entity will assess 
        for the presence of, and intervene to resolve, domestic 
        violence and child abuse and neglect, including how the entity 
        will coordinate with State and local child protective service 
        and domestic violence programs.</DELETED>
        <DELETED>    `(4) Addressing concerns relating to substance 
        abuse and sexual activity.--A commitment to make available to 
        each individual participating in the project education about 
        alcohol, tobacco, and other drugs, and about the health risks 
        associated with abusing such substances, and information about 
        diseases and conditions transmitted through substance abuse and 
        sexual contact, including HIV/AIDS, and to coordinate with 
        providers of services addressing such problems, as 
        appropriate.</DELETED>
        <DELETED>    `(5) Coordination with specified programs.--An 
        undertaking to coordinate, as appropriate, with State and local 
        entities responsible for the programs under parts A, B, and D 
        of this title, including programs under title I of the 
        Workforce Investment Act of 1998 (including the One-Stop 
        delivery system), and such other programs as the Secretary may 
        require.</DELETED>
        <DELETED>    `(6) Records, reports, and audits.--An agreement 
        to maintain such records, make such reports, and cooperate with 
        such reviews or audits as the Secretary may find necessary for 
        purposes of oversight of project activities and 
        expenditures.</DELETED>
        <DELETED>    `(7) Self-initiated evaluation.--If the entity 
        elects to contract for independent evaluation of the project 
        (part or all of the cost of which may be paid for using grant 
        funds), a commitment to submit to the Secretary a copy of the 
        evaluation report within 30 days after completion of the report 
        and not more than 1 year after completion of the 
        project.</DELETED>
        <DELETED>    `(8) Cooperation with secretary's oversight and 
        evaluation.--An agreement to cooperate with the Secretary's 
        evaluation of projects assisted under this section, by means 
        including random assignment of clients to service recipient and 
        control groups, if determined by the Secretary to be 
        appropriate, and affording the Secretary access to the project 
        and to project-related records and documents, staff, and 
        clients.</DELETED>
<DELETED>    `(c) Eligibility Criteria for Limited Purpose Grants.--In 
order to be eligible for a grant under this section in an amount under 
$25,000 per fiscal year, an entity shall submit an application to the 
Secretary containing the following:</DELETED>
        <DELETED>    `(1) Project description.--A description of the 
        project and how it will be carried out, including the number 
        and characteristics of clients to be served, the proposed 
        duration of the project, and how it will address at least 1 of 
        the 4 objectives specified in section 441(b)(1).</DELETED>
        <DELETED>    `(2) Qualifications.--Such information as the 
        Secretary may require as to the capacity of the entity to carry 
        out the project, including any previous experience with similar 
        activities.</DELETED>
        <DELETED>    `(3) Coordination with related programs.--As 
        required by the Secretary in appropriate cases, an undertaking 
        to coordinate and cooperate with State and local entities 
        responsible for specific programs relating to the objectives of 
        the project including, as appropriate, jobs programs and 
        programs serving children and families.</DELETED>
        <DELETED>    `(4) Records, reports, and audits.--An agreement 
        to maintain such records, make such reports, and cooperate with 
        such reviews or audits as the Secretary may find necessary for 
        purposes of oversight of project activities and 
        expenditures.</DELETED>
        <DELETED>    `(5) Cooperation with secretary's oversight and 
        evaluation.--An agreement to cooperate with the Secretary's 
        evaluation of projects assisted under this section, by means 
        including affording the Secretary access to the project and to 
        project-related records and documents, staff, and 
        clients.</DELETED>
<DELETED>    `(d) Considerations in Awarding Grants.--</DELETED>
        <DELETED>    `(1) Diversity of projects.--In awarding grants 
        under this section, the Secretary shall seek to achieve a 
        balance among entities of differing sizes, entities in 
        differing geographic areas, entities in urban and in rural 
        areas, and entities employing differing methods of achieving 
        the purposes of this section, including working with the State 
        agency responsible for the administration of part D to help 
        fathers satisfy child support arrearage obligations.</DELETED>
        <DELETED>    `(2) Preference for projects serving low-income 
        fathers.--In awarding grants under this section, the Secretary 
        may give preference to applications for projects in which a 
        majority of the clients to be served are low-income 
        fathers.</DELETED>
<DELETED>    `(e) Federal Share.--</DELETED>
        <DELETED>    `(1) In general.--Grants for a project under this 
        section for a fiscal year shall be available for a share of the 
        cost of such project in such fiscal year equal to--</DELETED>
                <DELETED>    `(A) up to 80 percent (or up to 90 
                percent, if the entity demonstrates to the Secretary's 
                satisfaction circumstances limiting the entity's 
                ability to secure non-Federal resources) in the case of 
                a project under subsection (b); and</DELETED>
                <DELETED>    `(B) up to 100 percent, in the case of a 
                project under subsection (c).</DELETED>
        <DELETED>    `(2) Non-federal share.--The non-Federal share may 
        be in cash or in kind. In determining the amount of the non-
        Federal share, the Secretary may attribute fair market value to 
        goods, services, and facilities contributed from non-Federal 
        sources.</DELETED>

<DELETED>`SEC. 444. MULTICITY, MULTISTATE DEMONSTRATION 
              PROJECTS.</DELETED>

<DELETED>    `(a) In General.--The Secretary may make grants under this 
section for fiscal years 2003 through 2007 to eligible entities (as 
specified in subsection (b)) for 2 multicity, multistate projects 
demonstrating approaches to achieving the objectives specified in 
section 441(b)(1). One of the projects shall test the use of married 
couples to deliver program services.</DELETED>
<DELETED>    `(b) Eligible Entities.--An entity eligible for a grant 
under this section must be a national nonprofit fatherhood promotion 
organization that meets the following requirements:</DELETED>
        <DELETED>    `(1) Experience with fatherhood programs.--The 
        organization must have substantial experience in designing and 
        successfully conducting programs that meet the purposes 
        described in section 441.</DELETED>
        <DELETED>    `(2) Experience with multicity, multistate 
        programs and government coordination.--The organization must 
        have experience in simultaneously conducting such programs in 
        more than 1 major metropolitan area in more than 1 State and in 
        coordinating such programs, where appropriate, with State and 
        local government agencies and private, nonprofit agencies 
        (including community-based and religious organizations), 
        including State or local agencies responsible for child support 
        enforcement and workforce development.</DELETED>
<DELETED>    `(c) Application Requirements.--In order to be eligible 
for a grant under this section, an entity must submit to the Secretary 
an application that includes the following:</DELETED>
        <DELETED>    `(1) Qualifications.--</DELETED>
                <DELETED>    `(A) Eligible entity.--A demonstration 
                that the entity meets the requirements of subsection 
                (b).</DELETED>
                <DELETED>    `(B) Other.--Such other information as the 
                Secretary may find necessary to demonstrate the 
                entity's capacity to carry out the project, including 
                the entity's ability to provide the non-Federal share 
                of project resources.</DELETED>
        <DELETED>    `(2) Project description.--A description of and 
        commitments concerning the project design, including the 
        following:</DELETED>
                <DELETED>    `(A) In general.--A detailed description 
                of the proposed project design and how it will be 
                carried out, which shall--</DELETED>
                        <DELETED>    `(i) provide for the project to be 
                        conducted in at least 3 major metropolitan 
                        areas;</DELETED>
                        <DELETED>    `(ii) state how it will address 
                        each of the 4 objectives specified in section 
                        441(b)(1);</DELETED>
                        <DELETED>    `(iii) demonstrate that there is a 
                        sufficient number of potential clients to allow 
                        for the random selection of individuals to 
                        participate in the project and for comparisons 
                        with appropriate control groups composed of 
                        individuals who have not participated in such 
                        projects; and</DELETED>
                        <DELETED>    `(iv) demonstrate that the project 
                        is designed to direct a majority of project 
                        resources to activities serving low-income 
                        fathers (but the project need not make services 
                        available on a means-tested basis).</DELETED>
                <DELETED>    `(B) Oversight, evaluation, and adjustment 
                component.--An agreement that the entity--</DELETED>
                        <DELETED>    `(i) in consultation with the 
                        evaluator selected pursuant to section 445, and 
                        as required by the Secretary, will modify the 
                        project design, initially and (if necessary) 
                        subsequently throughout the duration of the 
                        project, in order to facilitate ongoing and 
                        final oversight and evaluation of project 
                        operation and outcomes (by means including, to 
                        the maximum extent feasible, random assignment 
                        of clients to service recipient and control 
                        groups), and to provide for mid-course 
                        adjustments in project design indicated by 
                        interim evaluations;</DELETED>
                        <DELETED>    `(ii) will submit to the Secretary 
                        revised descriptions of the project design as 
                        modified in accordance with clause (i); 
                        and</DELETED>
                        <DELETED>    `(iii) will cooperate fully with 
                        the Secretary's ongoing oversight and ongoing 
                        and final evaluation of the project, by means 
                        including affording the Secretary access to the 
                        project and to project-related records and 
                        documents, staff, and clients.</DELETED>
        <DELETED>    `(3) Addressing child abuse and neglect and 
        domestic violence.--A description of how the entity will assess 
        for the presence of, and intervene to resolve, domestic 
        violence and child abuse and neglect, including how the entity 
        will coordinate with State and local child protective service 
        and domestic violence programs.</DELETED>
        <DELETED>    `(4) Addressing concerns relating to substance 
        abuse and sexual activity.--A commitment to make available to 
        each individual participating in the project education about 
        alcohol, tobacco, and other drugs, and about the health risks 
        associated with abusing such substances, and information about 
        diseases and conditions transmitted through substance abuse and 
        sexual contact, including HIV/AIDS, and to coordinate with 
        providers of services addressing such problems, as 
        appropriate.</DELETED>
        <DELETED>    `(5) Coordination with specified programs.--An 
        undertaking to coordinate, as appropriate, with State and local 
        entities responsible for the programs funded under parts A, B, 
        and D of this title, programs under title I of the Workforce 
        Investment Act of 1998 (including the One-Stop delivery 
        system), and such other programs as the Secretary may 
        require.</DELETED>
        <DELETED>    `(6) Records, reports, and audits.--An agreement 
        to maintain such records, make such reports, and cooperate with 
        such reviews or audits (in addition to those required under the 
        preceding provisions of paragraph (2)) as the Secretary may 
        find necessary for purposes of oversight of project activities 
        and expenditures.</DELETED>
<DELETED>    `(d) Federal Share.--</DELETED>
        <DELETED>    `(1) In general.--Grants for a project under this 
        section for a fiscal year shall be available for up to 80 
        percent of the cost of such project in such fiscal 
        year.</DELETED>
        <DELETED>    `(2) Non-federal share.--The non-Federal share may 
        be in cash or in kind. In determining the amount of the non-
        Federal share, the Secretary may attribute fair market value to 
        goods, services, and facilities contributed from non-Federal 
        sources.</DELETED>

<DELETED>`SEC. 445. EVALUATION.</DELETED>

<DELETED>    `(a) In General.--The Secretary, directly or by contract 
or cooperative agreement, shall evaluate the effectiveness of service 
projects funded under sections 443 and 444 from the standpoint of the 
purposes specified in section 441(b)(1).</DELETED>
<DELETED>    `(b) Evaluation Methodology.--Evaluations under this 
section shall--</DELETED>
        <DELETED>    `(1) include, to the maximum extent feasible, 
        random assignment of clients to service delivery and control 
        groups and other appropriate comparisons of groups of 
        individuals receiving and not receiving services;</DELETED>
        <DELETED>    `(2) describe and measure the effectiveness of the 
        projects in achieving their specific project goals; 
        and</DELETED>
        <DELETED>    `(3) describe and assess, as appropriate, the 
        impact of such projects on marriage, parenting, domestic 
        violence, child abuse and neglect, money management, employment 
        and earnings, payment of child support, and child well-being, 
        health, and education.</DELETED>
<DELETED>    `(c) Evaluation Reports.--The Secretary shall publish the 
following reports on the results of the evaluation:</DELETED>
        <DELETED>    `(1) An implementation evaluation report covering 
        the first 24 months of the activities under this part to be 
        completed by 36 months after initiation of such 
        activities.</DELETED>
        <DELETED>    `(2) A final report on the evaluation to be 
        completed by September 30, 2010.</DELETED>

<DELETED>`SEC. 446. PROJECTS OF NATIONAL SIGNIFICANCE.</DELETED>

<DELETED>    `The Secretary is authorized, by grant, contract, or 
cooperative agreement, to carry out projects and activities of national 
significance relating to fatherhood promotion, including--</DELETED>
        <DELETED>    `(1) Collection and dissemination of 
        information.--Assisting States, communities, and private 
        entities, including religious organizations, in efforts to 
        promote and support marriage and responsible fatherhood by 
        collecting, evaluating, developing, and making available 
        (through the Internet and by other means) to all interested 
        parties information regarding approaches to accomplishing the 
        objectives specified in section 441(b)(1).</DELETED>
        <DELETED>    `(2) Media campaign.--Developing, promoting, and 
        distributing to interested States, local governments, public 
        agencies, and private nonprofit organizations, including 
        charitable and religious organizations, a media campaign that 
        promotes and encourages involved, committed, and responsible 
        fatherhood and married fatherhood.</DELETED>
        <DELETED>    `(3) Technical assistance.--Providing technical 
        assistance, including consultation and training, to public and 
        private entities, including community organizations and faith-
        based organizations, in the implementation of local fatherhood 
        promotion programs.</DELETED>
        <DELETED>    `(4) Research.--Conducting research related to the 
        purposes of this part.</DELETED>

<DELETED>`SEC. 447. NONDISCRIMINATION.</DELETED>

<DELETED>    `The projects and activities assisted under this part 
shall be available on the same basis to all fathers and expectant 
fathers able to benefit from such projects and activities, including 
married and unmarried fathers and custodial and noncustodial fathers, 
with particular attention to low-income fathers, and to mothers and 
expectant mothers on the same basis as to fathers.</DELETED>

<DELETED>`SEC. 448. AUTHORIZATION OF APPROPRIATIONS; RESERVATION FOR 
              CERTAIN PURPOSE.</DELETED>

<DELETED>    `(a) Authorization.--There are authorized to be 
appropriated $20,000,000 for each of fiscal years 2003 through 2007 to 
carry out the provisions of this part.</DELETED>
<DELETED>    `(b) Reservation.--Of the amount appropriated under this 
section for each fiscal year, not more than 15 percent shall be 
available for the costs of the multicity, multicounty, multistate 
demonstration projects under section 444, evaluations under section 
445, and projects of national significance under section 
446.'.</DELETED>
<DELETED>    ``(b) Inapplicability of Effective Date Provisions.--
Section 116 shall not apply to the amendment made by subsection (a) of 
this section.''.</DELETED>
        <DELETED>    (2) Clerical amendment.--Section 2 of such Act is 
        amended in the table of contents by inserting after the item 
        relating to section 116 the following new item:</DELETED>

<DELETED>``Sec. 117. Fatherhood program.''.

<DELETED>SEC. 120. STATE OPTION TO MAKE TANF PROGRAMS MANDATORY 
              PARTNERS WITH ONE-STOP EMPLOYMENT TRAINING 
              CENTERS.</DELETED>

<DELETED>    Section 408 of the Social Security Act (42 U.S.C. 608) is 
amended by adding at the end the following:</DELETED>
<DELETED>    ``(h) State Option to Make TANF Programs Mandatory 
Partners With One-Stop Employment Training Centers.--For purposes of 
section 121(b) of the Workforce Investment Act of 1998, a State program 
funded under part A of title IV of the Social Security Act shall be 
considered a program referred to in paragraph (1)(B) of such section, 
unless, after the date of the enactment of this subsection, the 
Governor of the State notifies the Secretaries of Health and Human 
Services and Labor in writing of the decision of the Governor not to 
make the State program a mandatory partner.''.</DELETED>

<DELETED>SEC. 121. SENSE OF THE CONGRESS.</DELETED>

<DELETED>    It is the sense of the Congress that a State welfare-to-
work program should include a mentoring program.</DELETED>

                <DELETED>TITLE II--CHILD CARE</DELETED>

<DELETED>SEC. 201. SHORT TITLE.</DELETED>

<DELETED>    This title may be cited as the ``Caring for Children Act 
of 2002''.</DELETED>

<DELETED>SEC. 202. GOALS.</DELETED>

<DELETED>    (a) Goals.--Section 658A(b) of the Child Care and 
Development Block Grant Act of 1990 (42 U.S.C. 9801 note) is amended--
</DELETED>
        <DELETED>    (1) in paragraph (3) by striking ``encourage'' and 
        inserting ``assist'',</DELETED>
        <DELETED>    (2) by amending paragraph (4) to read as 
        follows:</DELETED>
        <DELETED>    ``(4) to assist State to provide child care to 
        low-income parents;'',</DELETED>
        <DELETED>    (3) by redesignating paragraph (5) as paragraph 
        (7), and</DELETED>
        <DELETED>    (4) by inserting after paragraph (4) the 
        following:</DELETED>
        <DELETED>    ``(5) to encourage States to improve the quality 
        of child care available to families;</DELETED>
        <DELETED>    ``(6) to promote school readiness by encouraging 
        the exposure of young children in child care to nurturing 
        environments and developmentally-appropriate activities, 
        including activities to foster early cognitive and literacy 
        development; and''.</DELETED>
<DELETED>    (b) Conforming Amendment.--Section 658E(c)(3)(B) of the 
Child Care and Development Block Grant Act of 1990 (42 U.S.C. 
9858c(c)(3)(B)) is amended by striking ``through (5)'' and inserting 
``through (7)''.</DELETED>

<DELETED>SEC. 203. AUTHORIZATION OF APPROPRIATIONS.</DELETED>

<DELETED>    Section 658B of the Child Care and Development Block Grant 
Act of 1990 (42 U.S.C. 9858) is amended--</DELETED>
        <DELETED>    (1) by striking ``is'' and inserting ``are'', 
        and</DELETED>
        <DELETED>    (2) by striking ``$1,000,000,000 for each of the 
        fiscal years 1996 through 2002'' and inserting ``$2,300,000,000 
        for fiscal year 2003, $2,500,000,000 for fiscal year 2004, 
        $2,700,000,000 for fiscal year 2005, $2,900,000,000 for fiscal 
        year 2006, and $3,100,000,000 for fiscal year 2007''.</DELETED>

<DELETED>SEC. 204. APPLICATION AND PLAN.</DELETED>

<DELETED>    Section 658E(c)(2) of the Child Care and Development Block 
Grant Act of 1990 (42 U.S.C. 9858C(c)(2)) is amended--</DELETED>
        <DELETED>    (1) by amending subparagraph (D) to read as 
        follows:</DELETED>
                <DELETED>    ``(D) Consumer and child care provider 
                education information.--Certify that the State will 
                collect and disseminate, through resource and referral 
                services and other means as determined by the State, to 
                parents of eligible children, child care providers, and 
                the general public, information regarding--</DELETED>
                        <DELETED>    ``(i) the promotion of informed 
                        child care choices, including information about 
                        the quality and availability of child care 
                        services;</DELETED>
                        <DELETED>    ``(ii) research and best practices 
                        on children's development, including early 
                        cognitive development;</DELETED>
                        <DELETED>    ``(iii) the availability of 
                        assistance to obtain child care services; 
                        and</DELETED>
                        <DELETED>    ``(iv) other programs for which 
                        families that receive child care services for 
                        which financial assistance is provided under 
                        this subchapter may be eligible, including the 
                        food stamp program, the WIC program under 
                        section 17 of the Child Nutrition Act of 1966, 
                        the child and adult care food program under 
                        section 17 of the Richard B. Russell National 
                        School Lunch Act, and the medicaid and CHIP 
                        programs under titles XIX and XXI of the Social 
                        Security Act.'', and</DELETED>
        <DELETED>    (2) by inserting after subparagraph (H) the 
        following:</DELETED>
                <DELETED>    ``(I) Coordination with other early child 
                care services and early childhood education programs.--
                Demonstrate how the State is coordinating child care 
                services provided under this subchapter with Head 
                Start, Early Reading First, Even Start, Ready-To-Learn 
                Television, State pre-kindergarten programs, and other 
                early childhood education programs to expand 
                accessibility to and continuity of care and early 
                education without displacing services provided by the 
                current early care and education delivery 
                system.</DELETED>
                <DELETED>    ``(J) Public-private partnerships.--
                Demonstrate how the State encourages partnerships with 
                private and other public entities to leverage existing 
                service delivery systems of early childhood education 
                and increase the supply and quality of child care 
                services.</DELETED>
                <DELETED>    ``(K) Child care service quality.--
                </DELETED>
                        <DELETED>    ``(i) Certification.--For each 
                        fiscal year after fiscal year 2003, certify 
                        that during the then preceding fiscal year the 
                        State was in compliance with section 658G and 
                        describe how funds were used to comply with 
                        such section during such preceding fiscal 
                        year.</DELETED>
                        <DELETED>    ``(ii) Strategy.--For each fiscal 
                        year after fiscal year 2003, contain an outline 
                        of the strategy the State will implement during 
                        such fiscal year for which the State plan is 
                        submitted, to address the quality of child care 
                        services in child care settings that provide 
                        services for which assistance is made available 
                        under this subchapter, and include in such 
                        strategy--</DELETED>
                                <DELETED>    ``(I) a statement 
                                specifying how the State will address 
                                the activities described in paragraphs 
                                (1), (2), and (3) of section 
                                658G;</DELETED>
                                <DELETED>    ``(II) a description of 
                                quantifiable, objective measures for 
                                evaluating the quality of child care 
                                services separately with respect to the 
                                activities listed in each of such 
                                paragraphs that the State will use to 
                                evaluate its progress in improving the 
                                quality of such child care 
                                services;</DELETED>
                                <DELETED>    ``(III) a list of State-
                                developed child care service quality 
                                targets for such fiscal year quantified 
                                on the basis of such measures; 
                                and</DELETED>
                                <DELETED>    ``(IV) for each fiscal 
                                year after fiscal year 2003, a report 
                                on the progress made to achieve such 
                                targets during the then preceding 
                                fiscal year.</DELETED>
                        <DELETED>    ``(iii) Rule of construction.--
                        Nothing in this subparagraph shall be construed 
                        to require that the State apply measures for 
                        evaluating quality to specific types of child 
                        care providers.</DELETED>
                <DELETED>    ``(L) Access to care for certain 
                populations.--Demonstrate how the State is addressing 
                the child care needs of parents eligible for child care 
                services for which financial assistance is provided 
                under this subchapter who have children with special 
                needs, work nontraditional hours, or require child care 
                services for infants or toddlers.''.</DELETED>

<DELETED>SEC. 205. ACTIVITIES TO IMPROVE THE QUALITY OF CHILD 
              CARE.</DELETED>

<DELETED>    Section 658G of the Child Care and Development Block Grant 
Act of 1990 (42 U.S.C. 9858e) is amended to read as follows:</DELETED>

<DELETED>``SEC. 658G. ACTIVITIES TO IMPROVE THE QUALITY OF CHILD CARE 
              SERVICES.</DELETED>

<DELETED>    ``A State that receives funds to carry out this subchapter 
for a fiscal year, shall use not less than 6 percent of the amount of 
such funds for activities provided through resource and referral 
services or other means, that are designed to improve the quality of 
child care services for which financial assistance is made available 
under this subchapter. Such activities include--</DELETED>
        <DELETED>    ``(1) programs that provide training, education, 
        and other professional development activities to enhance the 
        skills of the child care workforce, including training 
        opportunities for caregivers in informal care 
        settings;</DELETED>
        <DELETED>    ``(2) activities within child care settings to 
        enhance early learning for young children, to promote early 
        literacy, and to foster school readiness;</DELETED>
        <DELETED>    ``(3) initiatives to increase the retention and 
        compensation of child care providers, including tiered 
        reimbursement rates for providers that meet quality standards 
        as defined by the State; or</DELETED>
        <DELETED>    ``(4) other activities deemed by the State to 
        improve the quality of child care services provided in such 
        State.''.</DELETED>

<DELETED>SEC. 206. REPORT BY SECRETARY.</DELETED>

<DELETED>    Section 658L of the Child Care and Development Block Grant 
Act of 1990 (42 U.S.C. 9858j) is amended to read as follows:</DELETED>

<DELETED>``SEC. 658L. REPORT BY SECRETARY.</DELETED>

<DELETED>    ``(a) Report Required.--Not later than October 1, 2004, 
and biennially thereafter, the Secretary shall prepare and submit to 
the Committee on Education and the Workforce of the House of 
Representatives and the Committee on Health, Education, Labor and 
Pensions of the Senate a report that contains the following:</DELETED>
        <DELETED>    ``(1) A summary and analysis of the data and 
        information provided to the Secretary in the State reports 
        submitted under section 658K.</DELETED>
        <DELETED>    ``(2) Aggregated statistics on the supply of, 
        demand for, and quality of child care, early education, and 
        non-school-hours programs.</DELETED>
        <DELETED>    ``(3) An assessment, and where appropriate, 
        recommendations for the Congress concerning efforts that should 
        be undertaken to improve the access of the public to quality 
        and affordable child care in the United States.</DELETED>
<DELETED>    ``(b) Collection of Information.--The Secretary may 
utilize the national child care data system available through resource 
and referral organizations at the local, State, and national level to 
collect the information required by subsection (a)(2).</DELETED>

<DELETED>SEC. 207. DEFINITIONS.</DELETED>

<DELETED>    Section 658P(4)(B) of the Child Care and Development Block 
Grant Act of 1990 (42 U.S.C. 9858N(4)(B)) is amended by striking ``85 
percent of the State median income'' and inserting ``income levels as 
established by the State, prioritized by need,''.</DELETED>

<DELETED>SEC. 208. ENTITLEMENT FUNDING.</DELETED>

<DELETED>    Section 418(a)(3) (42 U.S.C. 618(a)(3)) is amended--
</DELETED>
        <DELETED>    (1) by striking ``and'' at the end of subparagraph 
        (E);</DELETED>
        <DELETED>    (2) by striking the period at the end of 
        subparagraph (F) and inserting ``; and''; and</DELETED>
        <DELETED>    (3) by adding at the end the following:</DELETED>
                <DELETED>    ``(G) $2,917,000,000 for each of fiscal 
                years 2003 through 2007.''.</DELETED>

           <DELETED>TITLE III--TAXPAYER PROTECTIONS</DELETED>

<DELETED>SEC. 301. EXCLUSION FROM GROSS INCOME FOR INTEREST ON 
              OVERPAYMENTS OF INCOME TAX BY INDIVIDUALS.</DELETED>

<DELETED>    (a) In General.--Part III of subchapter B of chapter 1 of 
the Internal Revenue Code of 1986 (relating to items specifically 
excluded from gross income) is amended by inserting after section 139 
the following new section:</DELETED>

<DELETED>``SEC. 139A. EXCLUSION FROM GROSS INCOME FOR INTEREST ON 
              OVERPAYMENTS OF INCOME TAX BY INDIVIDUALS.</DELETED>

<DELETED>    ``(a) In General.--In the case of an individual, gross 
income shall not include interest paid under section 6611 on any 
overpayment of tax imposed by this subtitle.</DELETED>
<DELETED>    ``(b) Exception.--Subsection (a) shall not apply in the 
case of a failure to claim items resulting in the overpayment on the 
original return if the Secretary determines that the principal purpose 
of such failure is to take advantage of subsection (a).</DELETED>
<DELETED>    ``(c) Special Rule for Determining Modified Adjusted Gross 
Income.--For purposes of this title, interest not included in gross 
income under subsection (a) shall not be treated as interest which is 
exempt from tax for purposes of sections 32(i)(2)(B) and 6012(d) or any 
computation in which interest exempt from tax under this title is added 
to adjusted gross income.''.</DELETED>
<DELETED>    (b) Clerical Amendment.--The table of sections for part 
III of subchapter B of chapter 1 of such Code is amended by inserting 
after the item relating to section 139 the following new 
item:</DELETED>

                              <DELETED>``Sec. 139A. Exclusion from 
                                        gross income for interest on 
                                        overpayments of income tax by 
                                        individuals.''.
<DELETED>    (c) Effective Date.--The amendments made by this section 
shall apply to interest received after December 31, 2006.</DELETED>

<DELETED>SEC. 302. DEPOSITS MADE TO SUSPEND RUNNING OF INTEREST ON 
              POTENTIAL UNDERPAYMENTS.</DELETED>

<DELETED>    (a) In General.--Subchapter A of chapter 67 of the 
Internal Revenue Code of 1986 (relating to interest on underpayments) 
is amended by adding at the end the following new section:</DELETED>

<DELETED>``SEC. 6603. DEPOSITS MADE TO SUSPEND RUNNING OF INTEREST ON 
              POTENTIAL UNDERPAYMENTS, ETC.</DELETED>

<DELETED>    ``(a) Authority To Make Deposits Other Than As Payment of 
Tax.--A taxpayer may make a cash deposit with the Secretary which may 
be used by the Secretary to pay any tax imposed under subtitle A or B 
or chapter 41, 42, 43, or 44 which has not been assessed at the time of 
the deposit. Such a deposit shall be made in such manner as the 
Secretary shall prescribe.</DELETED>
<DELETED>    ``(b) No Interest Imposed.--To the extent that such 
deposit is used by the Secretary to pay tax, for purposes of section 
6601 (relating to interest on underpayments), the tax shall be treated 
as paid when the deposit is made.</DELETED>
<DELETED>    ``(c) Return of Deposit.--Except in a case where the 
Secretary determines that collection of tax is in jeopardy, the 
Secretary shall return to the taxpayer any amount of the deposit (to 
the extent not used for a payment of tax) which the taxpayer requests 
in writing.</DELETED>
<DELETED>    ``(d) Payment of Interest.--</DELETED>
        <DELETED>    ``(1) In general.--For purposes of section 6611 
        (relating to interest on overpayments), a deposit which is 
        returned to a taxpayer shall be treated as a payment of tax for 
        any period to the extent (and only to the extent) attributable 
        to a disputable tax for such period. Under regulations 
        prescribed by the Secretary, rules similar to the rules of 
        section 6611(b)(2) shall apply.</DELETED>
        <DELETED>    ``(2) Disputable tax.--</DELETED>
                <DELETED>    ``(A) In general.--For purposes of this 
                section, the term `disputable tax' means the amount of 
                tax specified at the time of the deposit as the 
                taxpayer's reasonable estimate of the maximum amount of 
                any tax attributable to disputable items.</DELETED>
                <DELETED>    ``(B) Safe harbor based on 30-day 
                letter.--In the case of a taxpayer who has been issued 
                a 30-day letter, the maximum amount of tax under 
                subparagraph (A) shall not be less than the amount of 
                the proposed deficiency specified in such 
                letter.</DELETED>
        <DELETED>    ``(3) Other definitions.--For purposes of 
        paragraph (2)--</DELETED>
                <DELETED>    ``(A) Disputable item.--The term 
                `disputable item' means any item of income, gain, loss, 
                deduction, or credit if the taxpayer--</DELETED>
                        <DELETED>    ``(i) has a reasonable basis for 
                        its treatment of such item, and</DELETED>
                        <DELETED>    ``(ii) reasonably believes that 
                        the Secretary also has a reasonable basis for 
                        disallowing the taxpayer's treatment of such 
                        item.</DELETED>
                <DELETED>    ``(B) 30-day letter.--The term `30-day 
                letter' means the first letter of proposed deficiency 
                which allows the taxpayer an opportunity for 
                administrative review in the Internal Revenue Service 
                Office of Appeals.</DELETED>
        <DELETED>    ``(4) Rate of interest.--The rate of interest 
        allowable under this subsection shall be the Federal short-term 
        rate determined under section 6621(b), compounded 
        daily.</DELETED>
<DELETED>    ``(e) Use of Deposits.--</DELETED>
        <DELETED>    ``(1) Payment of tax.--Except as otherwise 
        provided by the taxpayer, deposits shall be treated as used for 
        the payment of tax in the order deposited.</DELETED>
        <DELETED>    ``(2) Returns of deposits.--Deposits shall be 
        treated as returned to the taxpayer on a last-in, first-out 
        basis.''.</DELETED>
<DELETED>    (b) Clerical Amendment.--The table of sections for 
subchapter A of chapter 67 of such Code is amended by adding at the end 
the following new item:</DELETED>

                              <DELETED>``Sec. 6603. Deposits made to 
                                        suspend running of interest on 
                                        potential underpayments, 
                                        etc.''.
<DELETED>    (c) Effective Date.--</DELETED>
        <DELETED>    (1) In general.--The amendments made by this 
        section shall apply to deposits made after the date of the 
        enactment of this Act.</DELETED>
        <DELETED>    (2) Coordination with deposits made under revenue 
        procedure 84-58.--In the case of an amount held by the 
        Secretary of the Treasury or his delegate on the date of the 
        enactment of this Act as a deposit in the nature of a cash bond 
        deposit pursuant to Revenue Procedure 84-58, the date that the 
        taxpayer identifies such amount as a deposit made pursuant to 
        section 6603 of the Internal Revenue Code (as added by this 
        Act) shall be treated as the date such amount is deposited for 
        purposes of such section 6603.</DELETED>

<DELETED>SEC. 303. PARTIAL PAYMENT OF TAX LIABILITY IN INSTALLMENT 
              AGREEMENTS.</DELETED>

<DELETED>    (a) In General.--</DELETED>
        <DELETED>    (1) Section 6159(a) of the Internal Revenue Code 
        of 1986 (relating to authorization of agreements) is amended--
        </DELETED>
                <DELETED>    (A) by striking ``satisfy liability for 
                payment of'' and inserting ``make payment on'', 
                and</DELETED>
                <DELETED>    (B) by inserting ``full or partial'' after 
                ``facilitate''.</DELETED>
        <DELETED>    (2) Section 6159(c) of such Code (relating to 
        Secretary required to enter into installment agreements in 
        certain cases) is amended in the matter preceding paragraph (1) 
        by inserting ``full'' before ``payment''.</DELETED>
<DELETED>    (b) Requirement To Review Partial Payment Agreements Every 
Two Years.--Section 6159 of such Code is amended by redesignating 
subsections (d) and (e) as subsections (e) and (f), respectively, and 
inserting after subsection (c) the following new subsection:</DELETED>
<DELETED>    ``(d) Secretary Required To Review Installment Agreements 
for Partial Collection Every Two Years.--In the case of an agreement 
entered into by the Secretary under subsection (a) for partial 
collection of a tax liability, the Secretary shall review the agreement 
at least once every 2 years.''.</DELETED>
<DELETED>    (c) Effective Date.--The amendments made by this section 
shall apply to agreements entered into on or after the date of the 
enactment of this Act.</DELETED>

               <DELETED>TITLE IV--CHILD SUPPORT</DELETED>

<DELETED>SEC. 401. FEDERAL MATCHING FUNDS FOR LIMITED PASS THROUGH OF 
              CHILD SUPPORT PAYMENTS TO FAMILIES RECEIVING 
              TANF.</DELETED>

<DELETED>    (a) In General.--Section 457(a) (42 U.S.C. 657(a)) is 
amended--</DELETED>
        <DELETED>    (1) in paragraph (1)(A), by inserting ``subject to 
        paragraph (7)'' before the semicolon; and</DELETED>
        <DELETED>    (2) by adding at the end the following:</DELETED>
        <DELETED>    ``(7) Federal matching funds for limited pass 
        through of child support payments to families receiving tanf.--
        Notwithstanding paragraph (1), a State shall not be required to 
        pay to the Federal Government the Federal share of an amount 
        collected during a month on behalf of a family that is a 
        recipient of assistance under the State program funded under 
        part A, to the extent that--</DELETED>
                <DELETED>    ``(A) the State distributes the amount to 
                the family;</DELETED>
                <DELETED>    ``(B) the total of the amounts so 
                distributed to the family during the month--</DELETED>
                        <DELETED>    ``(i) exceeds the amount (if any) 
                        that, as of December 31, 2001, was required 
                        under State law to be distributed to a family 
                        under paragraph (1)(B); and</DELETED>
                        <DELETED>    ``(ii) does not exceed the greater 
                        of--</DELETED>
                                <DELETED>    ``(I) $100; or</DELETED>
                                <DELETED>    ``(II) $50 plus the amount 
                                described in clause (i); and</DELETED>
                <DELETED>    ``(C) the amount is disregarded in 
                determining the amount and type of assistance provided 
                to the family under the State program funded under part 
                A.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendments made by subsection (a) 
shall apply to amounts distributed on or after October 1, 
2004.</DELETED>

<DELETED>SEC. 402. STATE OPTION TO PASS THROUGH ALL CHILD SUPPORT 
              PAYMENTS TO FAMILIES THAT FORMERLY RECEIVED 
              TANF.</DELETED>

<DELETED>    (a) In General.--Section 457(a) (42 U.S.C. 657(a)), as 
amended by section 401(a) of this Act, is amended--</DELETED>
        <DELETED>    (1) in paragraph (2)(B), in the matter preceding 
        clause (i), by inserting ``, except as provided in paragraph 
        (8),'' after ``shall''; and</DELETED>
        <DELETED>    (2) by adding at the end the following:</DELETED>
        <DELETED>    ``(8) State option to pass through all child 
        support payments to families that formerly received tanf.--In 
        lieu of applying paragraph (2) to any family described in 
        paragraph (2), a State may distribute to the family any amount 
        collected during a month on behalf of the family.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendments made by subsection (a) 
shall apply to amounts distributed on or after October 1, 
2004.</DELETED>

<DELETED>SEC. 403. MANDATORY REVIEW AND ADJUSTMENT OF CHILD SUPPORT 
              ORDERS FOR FAMILIES RECEIVING TANF.</DELETED>

<DELETED>    (a) In General.--Section 466(a)(10)(A)(i) (42 U.S.C. 
666(a)(10)(A)(i)) is amended--</DELETED>
        <DELETED>    (1) by striking ``parent, or,'' and inserting 
        ``parent or''; and</DELETED>
        <DELETED>    (2) by striking ``upon the request of the State 
        agency under the State plan or of either parent,''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by subsection (a) 
shall take effect on October 1, 2004.</DELETED>

<DELETED>SEC. 404. MANDATORY FEE FOR SUCCESSFUL CHILD SUPPORT 
              COLLECTION FOR FAMILY THAT HAS NEVER RECEIVED 
              TANF.</DELETED>

<DELETED>    (a) In General.--Section 454(6)(B) (42 U.S.C. 654(6)(B)) 
is amended--</DELETED>
        <DELETED>    (1) by inserting ``(i)'' after ``(B)'';</DELETED>
        <DELETED>    (2) by redesignating clauses (i) and (ii) as 
        subclauses (I) and (II), respectively;</DELETED>
        <DELETED>    (3) by adding ``and'' after the semicolon; 
        and</DELETED>
        <DELETED>    (4) by adding after and below the end the 
        following new clause:</DELETED>
                <DELETED>    ``(ii) in the case of an individual who 
                has never received assistance under a State program 
                funded under part A and for whom the State has 
                collected at least $500 of support, the State shall 
                impose an annual fee of $25 for each case in which 
                services are furnished, which shall be retained by the 
                State from support collected on behalf of the 
                individual (but not from the 1st $500 so collected), 
                paid by the individual applying for the services, 
                recovered from the absent parent, or paid by the State 
                out of its own funds (the payment of which from State 
                funds shall not be considered as an administrative cost 
                of the State for the operation of the plan, and shall 
                be considered income to the program);''.</DELETED>
<DELETED>    (b) Conforming Amendment.--Section 457(a)(3) (42 U.S.C. 
657(a)(3)) is amended to read as follows:</DELETED>
        <DELETED>    ``(3) Families that never received assistance.--In 
        the case of any other family, the State shall distribute to the 
        family the portion of the amount so collected that remains 
        after withholding any fee pursuant to section 
        454(6)(B)(ii).''.</DELETED>
<DELETED>    (c) Effective Date.--The amendments made by this section 
shall take effect on October 1, 2003.</DELETED>

<DELETED>SEC. 405. REPORT ON UNDISTRIBUTED CHILD SUPPORT 
              PAYMENTS.</DELETED>

<DELETED>    Not later than 6 months after the date of the enactment of 
this Act, the Secretary of Health and Human Services shall submit to 
the Committee on Ways and Means of the House of Representatives and the 
Committee on Finance of the Senate a report on the procedures that the 
States use generally to locate custodial parents for whom child support 
has been collected but not yet distributed. The report shall include an 
estimate of the total amount of such undistributed child support and 
the average length of time it takes for such child support to be 
distributed. To the extent the Secretary deems appropriate, the 
Secretary shall include in the report recommendations as to whether 
additional procedures should be established at the State or Federal 
level to expedite the payment of undistributed child support.</DELETED>

<DELETED>SEC. 406. USE OF NEW HIRE INFORMATION TO ASSIST IN 
              ADMINISTRATION OF UNEMPLOYMENT COMPENSATION 
              PROGRAMS.</DELETED>

<DELETED>    (a) In General.--Section 453(j) (42 U.S.C. 653(j)) is 
amended by adding at the end the following:</DELETED>
        <DELETED>    ``(7) Information comparisons and disclosure to 
        assist in administration of unemployment compensation 
        programs.--</DELETED>
                <DELETED>    ``(A) In general.--If a State agency 
                responsible for the administration of an unemployment 
                compensation program under Federal or State law 
                transmits to the Secretary the name and social security 
                account number of an individual, the Secretary shall, 
                if the information in the National Directory of New 
                Hires indicates that the individual may be employed, 
                disclose to the State agency the name, address, and 
                employer identification number of any putative employer 
                of the individual, subject to this paragraph.</DELETED>
                <DELETED>    ``(B) Condition on disclosure.--The 
                Secretary shall make a disclosure under subparagraph 
                (A) only to the extent that the Secretary determines 
                that the disclosure would not interfere with the 
                effective operation of the program under this 
                part.</DELETED>
                <DELETED>    ``(C) Use of information.--A State agency 
                may use information provided under this paragraph only 
                for purposes of administering a program referred to in 
                subparagraph (A).''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by subsection (a) 
shall take effect on October 1, 2003.</DELETED>

<DELETED>SEC. 407. DECREASE IN AMOUNT OF CHILD SUPPORT ARREARAGE 
              TRIGGERING PASSPORT DENIAL.</DELETED>

<DELETED>    (a) In General.--Section 452(k)(1) (42 U.S.C. 652(k)(1)) 
is amended by striking ``$5,000'' and inserting ``$2,500''.</DELETED>
<DELETED>    (b) Conforming Amendment.--Section 454(31) (42 U.S.C. 
654(31)) is amended by striking ``$5,000'' and inserting 
``$2,500''.</DELETED>
<DELETED>    (c) Effective Date.--The amendments made by this section 
shall take effect on October 1, 2003.</DELETED>

<DELETED>SEC. 408. USE OF TAX REFUND INTERCEPT PROGRAM TO COLLECT PAST-
              DUE CHILD SUPPORT ON BEHALF OF CHILDREN WHO ARE NOT 
              MINORS.</DELETED>

<DELETED>    (a) In General.--Section 464 (42 U.S.C. 664) is amended--
</DELETED>
        <DELETED>    (1) in subsection (a)(2)(A), by striking ``(as 
        that term is defined for purposes of this paragraph under 
        subsection (c))''; and</DELETED>
        <DELETED>    (2) in subsection (c)--</DELETED>
                <DELETED>    (A) in paragraph (1)--</DELETED>
                        <DELETED>    (i) by striking ``(1) Except as 
                        provided in paragraph (2), as used in'' and 
                        inserting ``In''; and</DELETED>
                        <DELETED>    (ii) by inserting ``(whether or 
                        not a minor)'' after ``a child'' each place it 
                        appears; and</DELETED>
                <DELETED>    (B) by striking paragraphs (2) and 
                (3).</DELETED>
<DELETED>    (b) Effective Date.--The amendments made by subsection (a) 
shall take effect on October 1, 2004.</DELETED>

<DELETED>SEC. 409. GARNISHMENT OF COMPENSATION PAID TO VETERANS FOR 
              SERVICE-CONNECTED DISABILITIES IN ORDER TO ENFORCE CHILD 
              SUPPORT OBLIGATIONS.</DELETED>

<DELETED>    (a) In General.--Section 459(h) (42 U.S.C. 659(h)) is 
amended--</DELETED>
        <DELETED>    (1) in paragraph (1)(A)(ii)(V), by striking all 
        that follows ``Armed Forces'' and inserting a semicolon; 
        and</DELETED>
        <DELETED>    (2) by adding at the end the following:</DELETED>
        <DELETED>    ``(3) Limitations with respect to compensation 
        paid to veterans for service-connected disabilities.--
        Notwithstanding any other provision of this section:</DELETED>
                <DELETED>    ``(A) Compensation described in paragraph 
                (1)(A)(ii)(V) shall not be subject to withholding 
                pursuant to this section--</DELETED>
                        <DELETED>    ``(i) for payment of alimony; 
                        or</DELETED>
                        <DELETED>    ``(ii) for payment of child 
                        support if the individual is fewer than 60 days 
                        in arrears in payment of the support.</DELETED>
                <DELETED>    ``(B) Not more than 50 percent of any 
                payment of compensation described in paragraph 
                (1)(A)(ii)(V) may be withheld pursuant to this 
                section.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendments made by subsection (a) 
shall take effect on October 1, 2004.</DELETED>

<DELETED>SEC. 410. IMPROVING FEDERAL DEBT COLLECTION 
              PRACTICES.</DELETED>

<DELETED>    Section 3716(h)(3) of title 31, United States Code, is 
amended to read as follows:</DELETED>
<DELETED>    ``(3) In applying this subsection with respect to any debt 
owed to a State, other than past due support being enforced by the 
State, subsection (c)(3)(A) shall not apply. Subsection (c)(3)(A) shall 
apply with respect to past due support being enforced by the State 
notwithstanding any other provision of law, including sections 207 and 
1631(d)(1) of the Social Security Act (42 U.S.C. 407 and 1383(d)(1)), 
section 413(b) of Public law 91-173 (30 U.S.C. 923(b)), and section 14 
of the Act of August 29, 1935 (45 U.S.C. 231m).''.</DELETED>

<DELETED>SEC. 411. MAINTENANCE OF TECHNICAL ASSISTANCE 
              FUNDING.</DELETED>

<DELETED>    Section 452(j) (42 U.S.C. 652(j)) is amended by inserting 
``or the amount appropriated under this paragraph for fiscal year 2002, 
whichever is greater,'' before ``which shall be available''.</DELETED>

<DELETED>SEC. 412. MAINTENANCE OF FEDERAL PARENT LOCATOR SERVICE 
              FUNDING.</DELETED>

<DELETED>    Section 453(o) (42 U.S.C. 653(o)) is amended--</DELETED>
        <DELETED>    (1) in the 1st sentence, by inserting ``or the 
        amount appropriated under this paragraph for fiscal year 2002, 
        whichever is greater,'' before ``which shall be available''; 
        and</DELETED>
        <DELETED>    (2) in the 2nd sentence, by striking ``for each of 
        fiscal years 1997 through 2001''.</DELETED>

               <DELETED>TITLE V--CHILD WELFARE</DELETED>

<DELETED>SEC. 501. EXTENSION OF AUTHORITY TO APPROVE DEMONSTRATION 
              PROJECTS.</DELETED>

<DELETED>    Section 1130(a)(2) (42 U.S.C. 1320a-9(a)(2)) is amended by 
striking ``2002'' and inserting ``2007''.</DELETED>

<DELETED>SEC. 502. ELIMINATION OF LIMITATION ON NUMBER OF 
              WAIVERS.</DELETED>

<DELETED>    Section 1130(a)(2) (42 U.S.C. 1320a-9(a)(2)) is amended by 
striking ``not more than 10''.</DELETED>

<DELETED>SEC. 503. ELIMINATION OF LIMITATION ON NUMBER OF STATES THAT 
              MAY BE GRANTED WAIVERS TO CONDUCT DEMONSTRATION PROJECTS 
              ON SAME TOPIC.</DELETED>

<DELETED>    Section 1130 (42 U.S.C. 1320a-9) is amended by adding at 
the end the following:</DELETED>
<DELETED>    ``(h) No Limit on Number of States That May Be Granted 
Waivers To Conduct Same or Similar Demonstration Projects.--The 
Secretary shall not refuse to grant a waiver to a State under this 
section on the grounds that a purpose of the waiver or of the 
demonstration project for which the waiver is necessary would be the 
same as or similar to a purpose of another waiver or project that is or 
may be conducted under this section.''.</DELETED>

<DELETED>SEC. 504. ELIMINATION OF LIMITATION ON NUMBER OF WAIVERS THAT 
              MAY BE GRANTED TO A SINGLE STATE FOR DEMONSTRATION 
              PROJECTS.</DELETED>

<DELETED>    Section 1130 (42 U.S.C. 1320a-9) is further amended by 
adding at the end the following:</DELETED>
<DELETED>    ``(i) No Limit on Number of Waivers Granted to, or 
Demonstration Projects That May Be Conducted by, a Single State.--The 
Secretary shall not impose any limit on the number of waivers that may 
be granted to a State, or the number of demonstration projects that a 
State may be authorized to conduct, under this section.''.</DELETED>

<DELETED>SEC. 505. STREAMLINED PROCESS FOR CONSIDERATION OF AMENDMENTS 
              TO AND EXTENSIONS OF DEMONSTRATION PROJECTS REQUIRING 
              WAIVERS.</DELETED>

<DELETED>    Section 1130 (42 U.S.C. 1320a-9) is further amended by 
adding at the end the following:</DELETED>
<DELETED>    ``(j) Streamlined Process for Consideration of Amendments 
and Extensions.--The Secretary shall develop a streamlined process for 
consideration of amendments and extensions proposed by States to 
demonstration projects conducted under this section.''.</DELETED>

<DELETED>SEC. 506. AVAILABILITY OF REPORTS.</DELETED>

<DELETED>    Section 1130 (42 U.S.C. 1320a-9) is further amended by 
adding at the end the following:</DELETED>
<DELETED>    ``(k) Availability of Reports.--The Secretary shall make 
available to any State or other interested party any report provided to 
the Secretary under subsection (f)(2), and any evaluation or report 
made by the Secretary with respect to a demonstration project conducted 
under this section, with a focus on information that may promote best 
practices and program improvements.''.</DELETED>

<DELETED>SEC. 507. TECHNICAL CORRECTION.</DELETED>

<DELETED>    Section 1130(b)(1) (42 U.S.C. 1320a-9(b)(1)) is amended by 
striking ``422(b)(9)'' and inserting ``422(b)(10)''.</DELETED>

       <DELETED>TITLE VI--SUPPLEMENTAL SECURITY INCOME</DELETED>

<DELETED>SEC. 601. REVIEW OF STATE AGENCY BLINDNESS AND DISABILITY 
              DETERMINATIONS.</DELETED>

<DELETED>    Section 1633 (42 U.S.C. 1383b) is amended by adding at the 
end the following:</DELETED>
<DELETED>    ``(e)(1) The Commissioner of Social Security shall review 
determinations, made by State agencies pursuant to subsection (a) in 
connection with applications for benefits under this title on the basis 
of blindness or disability, that individuals who have attained 18 years 
of age are blind or disabled as of a specified onset date. The 
Commissioner of Social Security shall review such a determination 
before any action is taken to implement the determination.</DELETED>
<DELETED>    ``(2)(A) In carrying out paragraph (1), the Commissioner 
of Social Security shall review--</DELETED>
        <DELETED>    ``(i) at least 20 percent of all determinations 
        referred to in paragraph (1) that are made in fiscal year 
        2003;</DELETED>
        <DELETED>    ``(ii) at least 40 percent of all such 
        determinations that are made in fiscal year 2004; and</DELETED>
        <DELETED>    ``(iii) at least 50 percent of all such 
        determinations that are made in fiscal year 2005 or 
        thereafter.</DELETED>
<DELETED>    ``(B) In carrying out subparagraph (A), the Commissioner 
of Social Security shall, to the extent feasible, select for review the 
determinations which the Commissioner of Social Security identifies as 
being the most likely to be incorrect.''.</DELETED>

       <DELETED>TITLE VII--STATE AND LOCAL FLEXIBILITY</DELETED>

<DELETED>SEC. 701. PROGRAM COORDINATION DEMONSTRATION 
              PROJECTS.</DELETED>

<DELETED>    (a) Purpose.--The purpose of this section is to establish 
a program of demonstration projects in a State or portion of a State to 
coordinate multiple public assistance, workforce development, and other 
programs, for the purpose of supporting working individuals and 
families, helping families escape welfare dependency, promoting child 
well-being, or helping build stronger families, using innovative 
approaches to strengthen service systems and provide more coordinated 
and effective service delivery.</DELETED>
<DELETED>    (b) Definitions.--In this section:</DELETED>
        <DELETED>    (1) Administering secretary.--The term 
        ``administering Secretary'' means, with respect to a qualified 
        program, the head of the Federal agency responsible for 
        administering the program.</DELETED>
        <DELETED>    (2) Qualified program.--The term ``qualified 
        program'' means--</DELETED>
                <DELETED>    (A) a program under part A of title IV of 
                the Social Security Act;</DELETED>
                <DELETED>    (B) the program under title XX of such 
                Act;</DELETED>
                <DELETED>    (C) activities funded under title I of the 
                Workforce Investment Act of 1998, except subtitle C of 
                such title;</DELETED>
                <DELETED>    (D) a demonstration project authorized 
                under section 505 of the Family Support Act of 
                1988;</DELETED>
                <DELETED>    (E) activities funded under the Wagner-
                Peyser Act;</DELETED>
                <DELETED>    (F) activities funded under the Adult 
                Education and Family Literacy Act;</DELETED>
                <DELETED>    (G) activities funded under the Child Care 
                and Development Block Grant Act of 1990;</DELETED>
                <DELETED>    (H) activities funded under the United 
                States Housing Act of 1937 (42 U.S.C. 1437 et seq.), 
                except that such term shall not include--</DELETED>
                        <DELETED>    (i) any program for rental 
                        assistance under section 8 of such Act (42 
                        U.S.C. 1437f); and</DELETED>
                        <DELETED>    (ii) the program under section 7 
                        of such Act (42 U.S.C. 1437e) for designating 
                        public housing for occupancy by certain 
                        populations;</DELETED>
                <DELETED>    (I) activities funded under title I, II, 
                III, or IV of the McKinney-Vento Homeless Assistance 
                Act (42 U.S.C. 11301 et seq.); or</DELETED>
                <DELETED>    (J) the food stamp program as defined in 
                section 3(h) of the Food Stamp Act of 1977 (7 U.S.C. 
                2012(h)).</DELETED>
<DELETED>    (c) Application Requirements.--The head of a State entity 
or of a sub-State entity administering 2 or more qualified programs 
proposed to be included in a demonstration project under this section 
shall (or, if the project is proposed to include qualified programs 
administered by 2 or more such entities, the heads of the administering 
entities (each of whom shall be considered an applicant for purposes of 
this section) shall jointly) submit to the administering Secretary of 
each such program an application that contains the following:</DELETED>
        <DELETED>    (1) Programs included.--A statement identifying 
        each qualified program to be included in the project, and 
        describing how the purposes of each such program will be 
        achieved by the project.</DELETED>
        <DELETED>    (2) Population served.--A statement identifying 
        the population to be served by the project and specifying the 
        eligibility criteria to be used.</DELETED>
        <DELETED>    (3) Description and justification.--A detailed 
        description of the project, including--</DELETED>
                <DELETED>    (A) a description of how the project is 
                expected to improve or enhance achievement of the 
                purposes of the programs to be included in the project, 
                from the standpoint of quality, of cost-effectiveness, 
                or of both; and</DELETED>
                <DELETED>    (B) a description of the performance 
                objectives for the project, including any proposed 
                modifications to the performance measures and reporting 
                requirements used in the programs.</DELETED>
        <DELETED>    (4) Waivers requested.--A description of the 
        statutory and regulatory requirements with respect to which a 
        waiver is requested in order to carry out the project, and a 
        justification of the need for each such waiver.</DELETED>
        <DELETED>    (5) Cost neutrality.--Such information and 
        assurances as necessary to establish to the satisfaction of the 
        administering Secretary, in consultation with the Director of 
        the Office of Management and Budget, that the proposed project 
        is reasonably expected to meet the applicable cost neutrality 
        requirements of subsection (d)(4).</DELETED>
        <DELETED>    (6) Evaluation and reports.--An assurance that the 
        applicant will conduct ongoing and final evaluations of the 
        project, and make interim and final reports to the 
        administering Secretary, at such times and in such manner as 
        the administering Secretary may require.</DELETED>
        <DELETED>    (7) Public housing agency plan.--In the case of an 
        application proposing a demonstration project that includes 
        activities referred to in subsection (b)(2)(H) of this 
        section--</DELETED>
                <DELETED>    (A) a certification that the applicable 
                annual public housing agency plan of any agency 
                affected by the project that is approved under section 
                5A of the United States Housing Act of 1937 (42 U.S.C. 
                1437c-1) by the Secretary includes the information 
                specified in paragraphs (1) through (4) of this 
                subsection; and</DELETED>
                <DELETED>    (B) any resident advisory board 
                recommendations, and other information, relating to the 
                project that, pursuant to section 5A(e)(2) of the 
                United States Housing Act of 1937 (42 U.S.C. 1437c-
                1(e)(2), is required to be included in the public 
                housing agency plan of any public housing agency 
                affected by the project.</DELETED>
        <DELETED>    (8) Other information and assurances.--Such other 
        information and assurances as the administering Secretary may 
        require.</DELETED>
<DELETED>    (d) Approval of Applications.--</DELETED>
        <DELETED>    (1) In general.--The administering Secretary with 
        respect to a qualified program that is identified in an 
        application submitted pursuant to subsection (c) may approve 
        the application and, except as provided in paragraph (2), waive 
        any requirement applicable to the program, to the extent 
        consistent with this section and necessary and appropriate for 
        the conduct of the demonstration project proposed in the 
        application, if the administering Secretary determines that the 
        project--</DELETED>
                <DELETED>    (A) has a reasonable likelihood of 
                achieving the objectives of the programs to be included 
                in the project;</DELETED>
                <DELETED>    (B) may reasonably be expected to meet the 
                applicable cost neutrality requirements of paragraph 
                (4), as determined by the Director of the Office of 
                Management and Budget; and</DELETED>
                <DELETED>    (C) includes the coordination of 2 or more 
                qualified programs.</DELETED>
        <DELETED>    (2) Provisions excluded from waiver authority.--A 
        waiver shall not be granted under paragraph (1)--</DELETED>
                <DELETED>    (A) with respect to any provision of law 
                relating to--</DELETED>
                        <DELETED>    (i) civil rights or prohibition of 
                        discrimination;</DELETED>
                        <DELETED>    (ii) purposes or goals of any 
                        program;</DELETED>
                        <DELETED>    (iii) maintenance of effort 
                        requirements;</DELETED>
                        <DELETED>    (iv) health or safety;</DELETED>
                        <DELETED>    (v) labor standards under the Fair 
                        Labor Standards Act of 1938; or</DELETED>
                        <DELETED>    (vi) environmental 
                        protection;</DELETED>
                <DELETED>    (B) with respect to section 241(a) of the 
                Adult Education and Family Literacy Act;</DELETED>
                <DELETED>    (C) in the case of a program under the 
                United States Housing Act of 1937 (42 U.S.C. 1437 et 
                seq.), with respect to any requirement under section 5A 
                of such Act (42 U.S.C. 1437c-1; relating to public 
                housing agency plans and resident advisory 
                boards);</DELETED>
                <DELETED>    (D) in the case of a program under the 
                Workforce Investment Act, with respect to any 
                requirement the waiver of which would violate section 
                189(i)(4)(A)(i) of such Act;</DELETED>
                <DELETED>    (E) in the case of the food stamp program 
                (as defined in section 3(h) of the Food Stamp Act of 
                1977 (7 U.S.C. 2012(h)), with respect to any 
                requirement under--</DELETED>
                        <DELETED>    (i) section 6 (if waiving a 
                        requirement under such section would have the 
                        effect of expanding eligibility for the 
                        program), 7(b) or 16(c) of the Food Stamp Act 
                        of 1977 (7 U.S.C. 2011 et seq.); or</DELETED>
                        <DELETED>    (ii) title IV of the Personal 
                        Responsibility and Work Opportunity 
                        Reconciliation Act of 1996 (8 U.S.C. 1601 et 
                        seq.);</DELETED>
                <DELETED>    (F) with respect to any requirement that a 
                State pass through to a sub-State entity part or all of 
                an amount paid to the State;</DELETED>
                <DELETED>    (G) if the waiver would waive any funding 
                restriction or limitation provided in an appropriations 
                Act, or would have the effect of transferring 
                appropriated funds from 1 appropriations account to 
                another; or</DELETED>
                <DELETED>    (H) except as otherwise provided by 
                statute, if the waiver would waive any funding 
                restriction applicable to a program authorized under an 
                Act which is not an appropriations Act (but not 
                including program requirements such as application 
                procedures, performance standards, reporting 
                requirements, or eligibility standards), or would have 
                the effect of transferring funds from a program for 
                which there is direct spending (as defined in section 
                250(c)(8) of the Balanced Budget and Emergency Deficit 
                Control Act of 1985) to another program.</DELETED>
        <DELETED>    (3) Agreement of each administering secretary 
        required.--</DELETED>
                <DELETED>    (A) In general.--An applicant may not 
                conduct a demonstration project under this section 
                unless each administering Secretary with respect to any 
                program proposed to be included in the project has 
                approved the application to conduct the 
                project.</DELETED>
                <DELETED>    (B) Agreement with respect to funding and 
                implementation.--Before approving an application to 
                conduct a demonstration project under this section, an 
                administering Secretary shall have in place an 
                agreement with the applicant with respect to the 
                payment of funds and responsibilities required of the 
                administering Secretary with respect to the 
                project.</DELETED>
        <DELETED>    (4) Cost-neutrality requirement.--</DELETED>
                <DELETED>    (A) General rule.--Notwithstanding any 
                other provision of law (except subparagraph (B)), the 
                total of the amounts that may be paid by the Federal 
                Government for a fiscal year with respect to the 
                programs in the State in which an entity conducting a 
                demonstration project under this section is located 
                that are affected by the project shall not exceed the 
                estimated total amount that the Federal Government 
                would have paid for the fiscal year with respect to the 
                programs if the project had not been conducted, as 
                determined by the Director of the Office of Management 
                and Budget.</DELETED>
                <DELETED>    (B) Special rule.--If an applicant submits 
                to the Director of the Office of Management and Budget 
                a request to apply the rules of this subparagraph to 
                the programs in the State in which the applicant is 
                located that are affected by a demonstration project 
                proposed in an application submitted by the applicant 
                pursuant to this section, during such period of not 
                more than 5 consecutive fiscal years in which the 
                project is in effect, and the Director determines, on 
                the basis of supporting information provided by the 
                applicant, to grant the request, then, notwithstanding 
                any other provision of law, the total of the amounts 
                that may be paid by the Federal Government for the 
                period with respect to the programs shall not exceed 
                the estimated total amount that the Federal Government 
                would have paid for the period with respect to the 
                programs if the project had not been 
                conducted.</DELETED>
        <DELETED>    (5) 90-day approval deadline.--</DELETED>
                <DELETED>    (A) In general.--If an administering 
                Secretary receives an application to conduct a 
                demonstration project under this section and does not 
                disapprove the application within 90 days after the 
                receipt, then--</DELETED>
                        <DELETED>    (i) the administering Secretary is 
                        deemed to have approved the application for 
                        such period as is requested in the application, 
                        except to the extent inconsistent with 
                        subsection (e); and</DELETED>
                        <DELETED>    (ii) any waiver requested in the 
                        application which applies to a qualified 
                        program that is identified in the application 
                        and is administered by the administering 
                        Secretary is deemed to be granted, except to 
                        the extent inconsistent with paragraph (2) or 
                        (4) of this subsection.</DELETED>
                <DELETED>    (B) Deadline extended if additional 
                information is sought.--The 90-day period referred to 
                in subparagraph (A) shall not include any period that 
                begins with the date the Secretary requests the 
                applicant to provide additional information with 
                respect to the application and ends with the date the 
                additional information is provided.</DELETED>
<DELETED>    (e) Duration of Projects.--A demonstration project under 
this section may be approved for a term of not more than 5 
years.</DELETED>
<DELETED>    (f) Reports to Congress.--</DELETED>
        <DELETED>    (1) Report on disposition of applications.--Within 
        90 days after an administering Secretary receives an 
        application submitted pursuant to this section, the 
        administering Secretary shall submit to each Committee of the 
        Congress which has jurisdiction over a qualified program 
        identified in the application notice of the receipt, a 
        description of the decision of the administering Secretary with 
        respect to the application, and the reasons for approving or 
        disapproving the application.</DELETED>
        <DELETED>    (2) Reports on projects.--Each administering 
        Secretary shall provide annually to the Congress a report 
        concerning demonstration projects approved under this section, 
        including--</DELETED>
                <DELETED>    (A) the projects approved for each 
                applicant;</DELETED>
                <DELETED>    (B) the number of waivers granted under 
                this section, and the specific statutory provisions 
                waived;</DELETED>
                <DELETED>    (C) how well each project for which a 
                waiver is granted is improving or enhancing program 
                achievement from the standpoint of quality, cost-
                effectiveness, or both;</DELETED>
                <DELETED>    (D) how well each project for which a 
                waiver is granted is meeting the performance objectives 
                specified in subsection (c)(3)(B);</DELETED>
                <DELETED>    (E) how each project for which a waiver is 
                granted is conforming with the cost-neutrality 
                requirements of subsection (d)(4); and</DELETED>
                <DELETED>    (F) to the extent the administering 
                Secretary deems appropriate, recommendations for 
                modification of programs based on outcomes of the 
                projects.</DELETED>
<DELETED>    (g) Amendment to United States Housing Act of 1937.--
Section 5A(d) of the United States Housing Act of 1937 (42 U.S.C. 
1437c-1(d)) is amended--</DELETED>
        <DELETED>    (1) by redesignating paragraph (18) as paragraph 
        (19); and</DELETED>
        <DELETED>    (2) by inserting after paragraph (17) the 
        following new paragraph:</DELETED>
        <DELETED>    ``(18) Program coordination demonstration 
        projects.--In the case of an agency that administers an 
        activity referred to in section 701(b)(2)(H) of the Personal 
        Responsibility, Work, and Family Promotion Act of 2002 that, 
        during such fiscal year, will be included in a demonstration 
        project under section 701 of such Act, the information that is 
        required to be included in the application for the project 
        pursuant to paragraphs (1) through (4) of section 701(b) of 
        such Act.''.</DELETED>

<DELETED>SEC. 702. STATE FOOD ASSISTANCE BLOCK GRANT DEMONSTRATION 
              PROJECT.</DELETED>

<DELETED>    The Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.) is 
amended by adding at the end the following:</DELETED>

<DELETED>``SEC. 28. STATE FOOD ASSISTANCE BLOCK GRANT DEMONSTRATION 
              PROJECT.</DELETED>

<DELETED>    ``(a) Establishment.--The Secretary shall establish a 
program to make grants to States in accordance with this section to 
provide--</DELETED>
        <DELETED>    ``(1) food assistance to needy individuals and 
        families residing in the State;</DELETED>
        <DELETED>    ``(2) funds to operate an employment and training 
        program under subsection (g) for needy individuals under the 
        program; and</DELETED>
        <DELETED>    ``(3) funds for administrative costs incurred in 
        providing the assistance.</DELETED>
<DELETED>    ``(b) Election.--</DELETED>
        <DELETED>    ``(1) In general.--A State may elect to 
        participate in the program established under subsection 
        (a).</DELETED>
        <DELETED>    ``(2) Election revocable.--A State that elects to 
        participate in the program established under subsection (a) may 
        subsequently reverse the election of the State only once 
        thereafter. Following the reversal, the State shall only be 
        eligible to participate in the food stamp program in accordance 
        with the other sections of this Act and shall not receive a 
        block grant under this section.</DELETED>
        <DELETED>    ``(3) Program exclusive.--A State that is 
        participating in the program established under subsection (a) 
        shall not be subject to, or receive any benefit under, this Act 
        except as provided in this section.</DELETED>
<DELETED>    ``(c) Lead Agency.--</DELETED>
        <DELETED>    ``(1) Designation.--A State desiring to 
        participate in the program established under subsection (a) 
        shall designate, in an application submitted to the Secretary 
        under subsection (d)(1), an appropriate State agency that 
        complies with paragraph (2) to act as the lead agency for the 
        State.</DELETED>
        <DELETED>    ``(2) Duties.--The lead agency shall--</DELETED>
                <DELETED>    ``(A) administer, either directly, through 
                other State agencies, or through local agencies, the 
                assistance received under this section by the 
                State;</DELETED>
                <DELETED>    ``(B) develop the State plan to be 
                submitted to the Secretary under subsection (d)(1); 
                and</DELETED>
                <DELETED>    ``(C) coordinate the provision of food 
                assistance under this section with other Federal, 
                State, and local programs.</DELETED>
<DELETED>    ``(d) Application and Plan.--</DELETED>
        <DELETED>    ``(1) Application.--To be eligible to receive 
        assistance under this section, a State shall prepare and submit 
        to the Secretary an application at such time, in such manner, 
        and containing such information as the Secretary shall by 
        regulation require, including--</DELETED>
                <DELETED>    ``(A) an assurance that the State will 
                comply with the requirements of this section;</DELETED>
                <DELETED>    ``(B) a State plan that meets the 
                requirements of paragraph (2); and</DELETED>
                <DELETED>    ``(C) an assurance that the State will 
                comply with the requirements of the State plan under 
                paragraph (2).</DELETED>
        <DELETED>    ``(2) Requirements of plan.--</DELETED>
                <DELETED>    ``(A) Lead agency.--The State plan shall 
                identify the lead agency.</DELETED>
                <DELETED>    ``(B) Use of block grant funds.--The State 
                plan shall provide that the State shall use the amounts 
                provided to the State for each fiscal year under this 
                section--</DELETED>
                        <DELETED>    ``(i) to provide food assistance 
                        to needy individuals and families residing in 
                        the State, other than residents of institutions 
                        who are ineligible for food stamps under 
                        section 3(i);</DELETED>
                        <DELETED>    ``(ii) to administer an employment 
                        and training program under subsection (g) for 
                        needy individuals under the program and to 
                        provide reimbursements to needy individuals and 
                        families as would be allowed under section 
                        16(h)(3); and</DELETED>
                        <DELETED>    ``(iii) to pay administrative 
                        costs incurred in providing the 
                        assistance.</DELETED>
                <DELETED>    ``(C) Assistance for entire state.--The 
                State plan shall provide that benefits under this 
                section shall be available throughout the entire 
                State.</DELETED>
                <DELETED>    ``(D) Notice and hearings.--The State plan 
                shall provide that an individual or family who applies 
                for, or receives, assistance under this section shall 
                be provided with notice of, and an opportunity for a 
                hearing on, any action under this section that 
                adversely affects the individual or family.</DELETED>
                <DELETED>    ``(E) Other assistance.--</DELETED>
                        <DELETED>    ``(i) Coordination.--The State 
                        plan may coordinate assistance received under 
                        this section with assistance provided under the 
                        State program funded under part A of title IV 
                        of the Social Security Act (42 U.S.C. 601 et 
                        seq.).</DELETED>
                        <DELETED>    ``(ii) Penalties.--If an 
                        individual or family is penalized for violating 
                        part A of title IV of the Act, the State plan 
                        may reduce the amount of assistance provided 
                        under this section or otherwise penalize the 
                        individual or family.</DELETED>
                <DELETED>    ``(F) Eligibility limitations.--The State 
                plan shall describe the income and resource eligibility 
                limitations that are established for the receipt of 
                assistance under this section.</DELETED>
                <DELETED>    ``(G) Receiving benefits in more than 1 
                jurisdiction.--The State plan shall establish a system 
                to verify and otherwise ensure that no individual or 
                family shall receive benefits under this section in 
                more than 1 jurisdiction within the State.</DELETED>
                <DELETED>    ``(H) Privacy.--The State plan shall 
                provide for safeguarding and restricting the use and 
                disclosure of information about any individual or 
                family receiving assistance under this 
                section.</DELETED>
                <DELETED>    ``(I) Other information.--The State plan 
                shall contain such other information as may be required 
                by the Secretary.</DELETED>
        <DELETED>    ``(3) Approval of application and plan.--During 
        fiscal years 2003 through 2007, the Secretary may approve the 
        applications and State plans that satisfy the requirements of 
        this section of not more than 5 States for a term of not more 
        than 5 years.</DELETED>
<DELETED>    ``(e) Construction of Facilities.--No funds made available 
under this section shall be expended for the purchase or improvement of 
land, or for the purchase, construction, or permanent improvement of 
any building or facility.</DELETED>
<DELETED>    ``(f) Benefits for Aliens.--No individual shall be 
eligible to receive benefits under a State plan approved under 
subsection (d)(3) if the individual is not eligible to participate in 
the food stamp program under title IV of the Personal Responsibility 
and Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1601 et 
seq.).</DELETED>
<DELETED>    ``(g) Employment and Training.--Each State shall implement 
an employment and training program for needy individuals under the 
program.</DELETED>
<DELETED>    ``(h) Enforcement.--</DELETED>
        <DELETED>    ``(1) Review of compliance with state plan.--The 
        Secretary shall review and monitor State compliance with this 
        section and the State plan approved under subsection 
        (d)(3).</DELETED>
        <DELETED>    ``(2) Noncompliance.--</DELETED>
                <DELETED>    ``(A) In general.--If the Secretary, after 
                reasonable notice to a State and opportunity for a 
                hearing, finds that--</DELETED>
                        <DELETED>    ``(i) there has been a failure by 
                        the State to comply substantially with any 
                        provision or requirement set forth in the State 
                        plan approved under subsection (d)(3); 
                        or</DELETED>
                        <DELETED>    ``(ii) in the operation of any 
                        program or activity for which assistance is 
                        provided under this section, there is a failure 
                        by the State to comply substantially with any 
                        provision of this section, the Secretary shall 
                        notify the State of the finding and that no 
                        further payments will be made to the State 
                        under this section (or, in the case of 
                        noncompliance in the operation of a program or 
                        activity, that no further payments to the State 
                        will be made with respect to the program or 
                        activity) until the Secretary is satisfied that 
                        there is no longer any failure to comply or 
                        that the noncompliance will be promptly 
                        corrected.</DELETED>
                <DELETED>    ``(B) Other sanctions.--In the case of a 
                finding of noncompliance made pursuant to subparagraph 
                (A), the Secretary may, in addition to, or in lieu of, 
                imposing the sanctions described in subparagraph (A), 
                impose other appropriate sanctions, including 
                recoupment of money improperly expended for purposes 
                prohibited or not authorized by this section and 
                disqualification from the receipt of financial 
                assistance under this section.</DELETED>
                <DELETED>    ``(C) Notice.--The notice required under 
                subparagraph (A) shall include a specific 
                identification of any additional sanction being imposed 
                under subparagraph (B).</DELETED>
        <DELETED>    ``(3) Issuance of regulations .--The Secretary 
        shall establish by regulation procedures for--</DELETED>
                <DELETED>    ``(A) receiving, processing, and 
                determining the validity of complaints concerning any 
                failure of a State to comply with the State plan or any 
                requirement of this section; and</DELETED>
                <DELETED>    ``(B) imposing sanctions under this 
                section.</DELETED>
<DELETED>    ``(i) Payments.--</DELETED>
        <DELETED>    ``(1) In general.--For each fiscal year, the 
        Secretary shall pay to a State that has an application approved 
        by the Secretary under subsection (d)(3) an amount that is 
        equal to the allotment of the State under subsection (l)(2) for 
        the fiscal year.</DELETED>
        <DELETED>    ``(2) Method of payment.--The Secretary shall make 
        payments to a State for a fiscal year under this section by 
        issuing 1 or more letters of credit for the fiscal year, with 
        necessary adjustments on account of overpayments or 
        underpayments, as determined by the Secretary.</DELETED>
        <DELETED>    ``(3) Spending of funds by state.--</DELETED>
                <DELETED>    ``(A) In general.--Except as provided in 
                subparagraph (B), payments to a State from an allotment 
                under subsection (l)(2) for a fiscal year may be 
                expended by the State only in the fiscal 
                year.</DELETED>
                <DELETED>    ``(B) Carryover.--The State may reserve up 
                to 10 percent of an allotment under subsection (l)(2) 
                for a fiscal year to provide assistance under this 
                section in subsequent fiscal years, except that the 
                reserved funds may not exceed 30 percent of the total 
                allotment received under this section for a fiscal 
                year.</DELETED>
        <DELETED>    ``(4) Provision of food assistance.--A State may 
        provide food assistance under this section in any manner 
        determined appropriate by the State to provide food assistance 
        to needy individuals and families in the State, such as 
        electronic benefits transfer limited to food purchases, coupons 
        limited to food purchases, or direct provision of 
        commodities.</DELETED>
        <DELETED>    ``(5) Definition of food assistance.--In this 
        section, the term `food assistance' means assistance that may 
        be used only to obtain food, as defined in section 
        3(g).</DELETED>
<DELETED>    ``(j) Audits.--</DELETED>
        <DELETED>    ``(1) Requirement.--After the close of each fiscal 
        year, a State shall arrange for an audit of the expenditures of 
        the State during the program period from amounts received under 
        this section.</DELETED>
        <DELETED>    ``(2) Independent auditor.--An audit under this 
        section shall be conducted by an entity that is independent of 
        any agency administering activities that receive assistance 
        under this section and be in accordance with generally accepted 
        auditing principles.</DELETED>
        <DELETED>    ``(3) Payment accuracy.--Each annual audit under 
        this section shall include an audit of payment accuracy under 
        this section that shall be based on a statistically valid 
        sample of the caseload in the State.</DELETED>
        <DELETED>    ``(4) Submission.--Not later than 30 days after 
        the completion of an audit under this section, the State shall 
        submit a copy of the audit to the legislature of the State and 
        to the Secretary.</DELETED>
        <DELETED>    ``(5) Repayment of amounts.--Each State shall 
        repay to the United States any amounts determined through an 
        audit under this section to have not been expended in 
        accordance with this section or to have not been expended in 
        accordance with the State plan, or the Secretary may offset the 
        amounts against any other amount paid to the State under this 
        section.</DELETED>
<DELETED>    ``(k) Nondiscrimination.--</DELETED>
        <DELETED>    ``(1) In general.--The Secretary shall not provide 
        financial assistance for any program, project, or activity 
        under this section if any person with responsibilities for the 
        operation of the program, project, or activity discriminates 
        with respect to the program, project, or activity because of 
        race, religion, color, national origin, sex, or 
        disability.</DELETED>
        <DELETED>    ``(2) Enforcement.--The powers, remedies, and 
        procedures set forth in title VI of the Civil Rights Act of 
        1964 (42 U.S.C. 2000d et seq.) may be used by the Secretary to 
        enforce paragraph (1).</DELETED>
<DELETED>    ``(l) Allotments.--</DELETED>
        <DELETED>    ``(1) Definition of state.--In this section, the 
        term 'State' means each of the 50 States, the District of 
        Columbia, Guam, and the Virgin Islands of the United 
        States.</DELETED>
        <DELETED>    ``(2) State allotment.--</DELETED>
                <DELETED>    ``(A) In general.--Except as provided in 
                subparagraph (B), from the amounts made available under 
                section 18 of this Act for each fiscal year, the 
                Secretary shall allot to each State participating in 
                the program established under subsection (a) an amount 
                that is equal to the sum of--</DELETED>
                        <DELETED>    ``(i) the greater of, as 
                        determined by the Secretary--</DELETED>
                                <DELETED>    ``(I) the total dollar 
                                value of all benefits issued under the 
                                food stamp program established under 
                                this Act by the State during fiscal 
                                year 2002; or</DELETED>
                                <DELETED>    ``(II) the average per 
                                fiscal year of the total dollar value 
                                of all benefits issued under the food 
                                stamp program by the State during each 
                                of fiscal years 2000 through 2002; 
                                and</DELETED>
                        <DELETED>    ``(ii) the greater of, as 
                        determined by the Secretary--</DELETED>
                                <DELETED>    ``(I) the total amount 
                                received by the State for 
                                administrative costs and the employment 
                                and training program under subsections 
                                (a) and (h), respectively, of section 
                                16 of this Act for fiscal year 2002; 
                                or</DELETED>
                                <DELETED>    ``(II) the average per 
                                fiscal year of the total amount 
                                received by the State for 
                                administrative costs and the employment 
                                and training program under subsections 
                                (a) and (h), respectively, of section 
                                16 of this Act for each of fiscal years 
                                2000 through 2002.</DELETED>
                <DELETED>    ``(B) Insufficient funds.--If the 
                Secretary finds that the total amount of allotments to 
                which States would otherwise be entitled for a fiscal 
                year under subparagraph (A) will exceed the amount of 
                funds that will be made available to provide the 
                allotments for the fiscal year, the Secretary shall 
                reduce the allotments made to States under this 
                subsection, on a pro rata basis, to the extent 
                necessary to allot under this subsection a total amount 
                that is equal to the funds that will be made 
                available.''.</DELETED>

          <DELETED>TITLE VIII--ABSTINENCE EDUCATION</DELETED>

<DELETED>SEC. 801. EXTENSION OF ABSTINENCE EDUCATION FUNDING UNDER 
              MATERNAL AND CHILD HEALTH PROGRAM.</DELETED>

<DELETED>    Section 510(d) (42 U.S.C. 710(d)) is amended by striking 
``2002'' and inserting ``2007''.</DELETED>

      <DELETED>TITLE IX--TRANSITIONAL MEDICAL ASSISTANCE</DELETED>

<DELETED>SEC. 901. ONE-YEAR REAUTHORIZATION OF TRANSITIONAL MEDICAL 
              ASSISTANCE.</DELETED>

<DELETED>    (a) In General.--Section 1925(f) (42 U.S.C. 1396r-6(f)) is 
amended by striking ``2002'' and inserting ``2003''.</DELETED>
<DELETED>    (b) Conforming Amendment.--Section 1902(e)(1)(B) (42 
U.S.C. 1396a(e)(1)(B)) is amended by striking ``2002'' and inserting 
``2003''.</DELETED>

<DELETED>SEC. 902. ADJUSTMENT TO PAYMENTS FOR MEDICAID ADMINISTRATIVE 
              COSTS TO PREVENT DUPLICATIVE PAYMENTS AND TO FUND A 1-
              YEAR EXTENSION OF TRANSITIONAL MEDICAL 
              ASSISTANCE.</DELETED>

<DELETED>    Section 1903 (42 U.S.C. 1396b) is amended--</DELETED>
        <DELETED>    (1) in subsection (a)(7), by striking ``section 
        1919(g)(3)(B)'' and inserting ``subsection (x) and section 
        1919(g)(3)(C)''; and</DELETED>
        <DELETED>    (2) by adding at the end the following:</DELETED>
<DELETED>    ``(x) Adjustments to Payments for Administrative Costs To 
Fund 1-Year Extension of Transitional Medical Assistance.--</DELETED>
        <DELETED>    ``(1) Reductions in payments for administrative 
        costs.--Effective for each calendar quarter in fiscal year 2003 
        and fiscal year 2004, the Secretary shall reduce the amount 
        paid under subsection (a)(7) to each State by an amount equal 
        to 50 percent for fiscal year 2003, and 75 percent for fiscal 
        year 2004, of one-quarter of the annualized amount determined 
        for the medicaid program under section 16(k)(2)(B) of the Food 
        Stamp Act of 1977 (7 U.S.C. 2025(k)(2)(B)).</DELETED>
        <DELETED>    ``(2) Allocation of administrative costs.--None of 
        the funds or expenditures described in section 16(k)(5)(B) of 
        the Food Stamp Act of 1977 (7 U.S.C. 2025(k)(5)(B)) may be used 
        to pay for costs--</DELETED>
                <DELETED>    ``(A) eligible for reimbursement under 
                subsection (a)(7) (or costs that would have been 
                eligible for reimbursement but for this subsection); 
                and</DELETED>
                <DELETED>    ``(B) allocated for reimbursement to the 
                program under this title under a plan submitted by a 
                State to the Secretary to allocate administrative costs 
                for public assistance programs;</DELETED>
        <DELETED>except that, for purposes of subparagraph (A), the 
        reference in clause (iii) of that section to `subsection (a)' 
        is deemed a reference to subsection (a)(7) and clause (iv)(II) 
        of that section shall be applied as if `medicaid program' were 
        substituted for `food stamp program'.''.</DELETED>

               <DELETED>TITLE X--EFFECTIVE DATE</DELETED>

<DELETED>SEC. 1001. EFFECTIVE DATE.</DELETED>

<DELETED>    (a) In General.--Except as otherwise provided, the 
amendments made by this Act shall take effect on October 1, 
2002.</DELETED>
<DELETED>    (b) Exception.--In the case of a State plan under part A 
or D of title IV of the Social Security Act which the Secretary 
determines requires State legislation in order for the plan to meet the 
additional requirements imposed by the amendments made by this Act, the 
effective date of the amendments imposing the additional requirements 
shall be 3 months after the first day of the first calendar quarter 
beginning after the close of the first regular session of the State 
legislature that begins after the date of the enactment of this Act. 
For purposes of the preceding sentence, in the case of a State that has 
a 2-year legislative session, each year of the session shall be 
considered to be a separate regular session of the State 
legislature.</DELETED>

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Work, Opportunity, and 
Responsibility for Kids Act of 2002'' or the ``WORK Act of 2002''.

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. References.
Sec. 4. Findings.

                            TITLE I--FUNDING

Sec. 101. Reauthorization of State family assistance grants.
Sec. 102. Contingency fund.
Sec. 103. Child care.
Sec. 104. State option to assist legal immigrant families.
Sec. 105. Use of funds.
Sec. 106. Definition of assistance.
Sec. 107. Maintenance of effort.
Sec. 108. Funding for families assisted by a territory program.
Sec. 109. Repeal of Federal loan fund for State welfare programs.
Sec. 110. Social Services Block Grant.
Sec. 111. Technical corrections.

                             TITLE II--WORK

Sec. 201. Universal engagement.
Sec. 202. Work participation requirements.

                TITLE III--FAMILY PROMOTION AND SUPPORT

Sec. 301. Healthy marriage promotion grants.
Sec. 302. Abstinence education.
Sec. 303. Teen pregnancy prevention resource center.
Sec. 304. Responsible fatherhood.
Sec. 305. Second chance homes.

                       TITLE IV--HEALTH COVERAGE

Sec. 401. 5-year extension and simplification of the transitional 
                            medical assistance program (TMA).
Sec. 402. Optional coverage of legal immigrants under the medicaid 
                            program and title XXI.
Sec. 403. Clarification of authority of States and local authorities to 
                            provide health care to immigrants.
Sec. 404. Clarification of no verification requirement for nonprofit 
                            charitable organizations.

                TITLE V--CHILD SUPPORT AND CHILD WELFARE

Sec. 501. Distribution of child support collected by States.
Sec. 502. Mandatory review and adjustment of child support orders for 
                            families receiving TANF.
Sec. 503. Decrease in amount of child support arrearage triggering 
                            passport denial.
Sec. 504. Use of tax refund intercept program to collect past-due child 
                            support on behalf of children who are not 
                            minors.
Sec. 505. Financing review and administrative funding.
Sec. 506. Adoption of uniform State laws.
Sec. 507. Tribal child support enforcement programs.
Sec. 508. Report on undistributed child support payments.
Sec. 509. Use of new hire information to assist in administration of 
                            unemployment compensation programs.
Sec. 510. Annual report on performance of State child support programs.
Sec. 511. Extension of authority to approve demonstration projects.
Sec. 512. Prohibition of limit on number of demonstration projects or 
                            waivers that may be granted to a single 
                            State.

                        TITLE VI--TRIBAL ISSUES

Sec. 601. Tribal TANF programs.
Sec. 602. Authority of Indian tribes to receive Federal funds for 
                            foster care and adoption assistance.

         TITLE VII--INNOVATION, FLEXIBILITY, AND ACCOUNTABILITY

Sec. 701. Data collection; performance measures.
Sec. 702. State plan.
Sec. 703. Research.
Sec. 704. Innovative business link partnership grants for employers and 
                            nonprofit organizations.
Sec. 705. Grants to improve access to transportation.
Sec. 706. At-home infant care.
Sec. 707. Grants to conduct demonstration projects on housing with 
                            services for families with multiple 
                            barriers to work.
Sec. 708. Transitional compliance for teen parents.
Sec. 709. TANF programs mandatory partners with one-stop employment 
                            training centers; State opt-out.
Sec. 710. Advanced planning document process for information management 
                            systems procurement approval.
Sec. 711. Waivers.
Sec. 712. Antidiscrimination.

                      TITLE VIII--OTHER PROVISIONS

Sec. 801. Review of State agency blindness and disability 
                            determinations.
Sec. 802. Customs user fees.

                        TITLE IX--EFFECTIVE DATE

Sec. 901. Effective date.

SEC. 3. REFERENCES.

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

SEC. 4. FINDINGS.

    Congress makes the following findings:
            (1) The Personal Responsibility and Work Opportunity 
        Reconciliation Act of 1996 (Public Law 104-193; 110 Stat. 2105) 
        was a fundamental change to reform the Federal welfare system 
        to shift it from an entitlement program into a transition 
        program to help families move from welfare to work and personal 
        responsibility.
            (2) Since enactment of the 1996 welfare reform law, welfare 
        cash assistance caseloads have dropped dramatically, by 
        approximately 50 percent, and approximately \2/3\ of welfare 
        recipients who have left the cash assistance rolls have left 
        for work.
            (3) Another sign of reform and progress is that funding has 
        shifted from providing monthly cash assistance for parents to 
        stay at home to over \1/2\ of the funding targeted to pay for 
        work supports, such as child care, transportation, job 
        placement, limited job training, and services to prevent 
        welfare dependency.
            (4) More investments in quality child care will allow 
        parents to enter and continue in the workforce knowing that 
        their children have access to safe, meaningful child care, 
        hopefully with emphasis on child development and preparation to 
        ensure that each child gains the skills needed to enter school 
        ready to learn.
            (5) While families are moving from welfare to work, and 
        employment rates are up, many families struggle in low-wage 
        jobs and have trouble getting promised supports such as 
        medicaid, child care, food stamps, and other supports available 
        under programs intended to help families.
            (6) Child poverty rates in the United States are improving 
        but they could be lower and they remain high when compared to 
        the rates of other developed countries. More must be done to 
        reduce child poverty in our Nation.
            (7) Many parents who remain on the welfare caseloads face 
        multiple barriers to employment and therefore need a range of 
        services to address their needs and move from welfare to work.
            (8) States should have plans for each family receiving 
        assistance to guide the family to self-sufficiency and to 
        consider the well-being of the children in the family. While 
        work participation levels have increased for recipients since 
        1996, those levels should be higher.
            (9) Children deserve to be raised in supportive homes, 
        preferably with 2 loving parents. It is crucial to end policies 
        that discriminate against serving 2-parent families within the 
        welfare system. It is also important to support innovative 
        programs to encourage full participation in child support and 
        child rearing by noncustodial parents.
            (10) Welfare reform has been successful because it has been 
        a flexible partnership between the Federal Government and the 
        States, and retaining the partnership and flexibility will be 
        important for future progress.
            (11) The State and local agencies responsible for 
        administering the temporary assistance to needy families 
        program have had to assume many new and more complex 
        responsibilities which necessitates improving and upgrading the 
        skills and ability of the workers at those agencies to ensure 
        high quality service delivery and meet all program goals, 
        including reducing high staff turnover rates for such agencies 
        and staff-to-participant ratios.
            (12) Studies have indicated disparate racial treatment in 
        the implementation of the temporary assistance to needy 
        families program with respect to determining eligibility for 
        assistance under the program, disseminating information, 
        providing referral for services, and imposing sanctions for 
        noncompliance with program requirements.

                            TITLE I--FUNDING

SEC. 101. REAUTHORIZATION OF STATE FAMILY ASSISTANCE GRANTS.

    Section 403(a)(1) is amended (42 U.S.C. 603(a)(1))--
            (1) in subparagraph (A), by striking ``1996'' and all that 
        follows through ``2002'' and inserting ``2003 through 2007'';
            (2) in subparagraph (B), by striking ``As used'' and 
        inserting ``Subject to subparagraph (E), as used'';
            (3) by redesignating subparagraph (E) as subparagraph (F);
            (4) by inserting after subparagraph (D) the following:
                    ``(E) Increase of grant for certain states.--
                            ``(i) In general.--With respect to a State 
                        family assistance grant made for each of fiscal 
                        years 2003 through 2007, in the case of a State 
                        that meets the criteria described in clause 
                        (ii) or (iii) (or both), the amount of the 
                        State family assistance grant determined under 
                        this paragraph for that State for each such 
                        fiscal year shall be increased by the 
                        applicable amount described in clause (iv).
                            ``(ii) Receipt of supplemental grant for 
                        fiscal year 2002.--For purposes of clause (i), 
                        the criteria described in this clause is that 
                        the State received a supplemental grant under 
                        paragraph (3) for fiscal year 2002 (as in 
                        effect with respect to such fiscal year).
                            ``(iii) State per capita income below the 
                        national average.--For purposes of clause (i), 
                        the criteria described in this clause is that, 
                        with respect to a State, the average State per 
                        capita income for calendar years 1998, 1999, 
                        and 2000, as published by the Department of 
                        Commerce in the May 2002 Survey of Current 
                        Business--
                                    ``(I) exceeds 80 percent, but does 
                                not exceed 90 percent of the average 
                                per capita income determined for all 
                                States for such calendar years; or
                                    ``(II) does not exceed 80 percent 
                                of the average per capita income 
                                determined for all States for such 
                                calendar years.
                            ``(iv) Applicable amount.--For purposes of 
                        clause (i), the applicable amount described in 
                        this clause is the following:
                                    ``(I) State with a supplemental 
                                grant in fiscal year 2002.--In the case 
                                of a State that meets the criteria 
                                described in clause (ii), the amount 
                                paid to the State under paragraph (3) 
                                for fiscal year 2002 (as in effect with 
                                respect to such fiscal year).
                                    ``(II) State with per capita income 
                                below national average.--In the case of 
                                a State that meets the criteria 
                                described in--
                                            ``(aa) clause (iii)(I), the 
                                        amount equal to 5 percent of 
                                        the State family assistance 
                                        grant determined for the State 
                                        for fiscal year 2003 (without 
                                        regard to this subparagraph, in 
                                        the case of a State that meets 
                                        the criteria in clause (ii)); 
                                        or
                                            ``(bb) clause (iii)(II), 
                                        the amount equal to 10 percent 
                                        of the State family assistance 
                                        grant determined for the State 
                                        for fiscal year 2003 (as so 
                                        determined).
                                    ``(III) State described in clauses 
                                (ii) and (iii).--In the case of a State 
                                that meets the criteria described in 
                                clauses (ii) and (iii), the amount 
                                equal to the sum of the amounts 
                                determined under subclauses (I) and 
                                (II) with respect to the State.
                            ``(v) Definition of state.--In this 
                        subparagraph, the term `State' means each of 
                        the 50 States and the District of Columbia.''; 
                        and
            (5) in subparagraph (F), as redesignated by paragraph (3), 
        by striking ``for fiscal years'' and all that follows through 
        the period and inserting ``for State family assistance grants 
        under this paragraph--
                            ``(i) for fiscal year 2003, 
                        $17,044,348,000; and
                            ``(ii) for each of fiscal years 2004 
                        through 2007, $17,042,348,000.''.

SEC. 102. CONTINGENCY FUND.

    (a) Contingency Funding Available to Needy States.--Section 403(b) 
(42 U.S.C. 603(b)) is amended--
            (1) by striking paragraphs (1) through (3) and inserting 
        the following:
            ``(1) Contingency fund grants.--
                    ``(A) Payments.--Subject to subparagraph (C), and 
                out of funds appropriated under subparagraph (E), each 
                State shall receive a contingency fund grant for each 
                eligible month in which the State is a needy State 
                under paragraph (3).
                    ``(B) Monthly contingency fund grant amount.--For 
                each eligible month in which a State is a needy State, 
                the State shall receive a contingency fund grant equal 
                to the higher of $0 and the applicable percentage (as 
                defined in subparagraph (D)(i)) of the product of--
                            ``(i) the applicable benefit level (as 
                        defined in subparagraph (D)(ii)); and
                            ``(ii) the adjusted increase in the number 
                        of families receiving assistance under the 
                        State program funded under this part and all 
                        programs funded with qualified State 
                        expenditures (as defined in subparagraph 
                        (D)(iii)).
                    ``(C) Limitation.--The total amount paid to a 
                single State under subparagraph (A) during a fiscal 
                year shall not exceed the amount equal to 10 percent of 
                the State family assistance grant (as defined under 
                subparagraph (B) of subsection (a)(1) and increased 
                under subparagraph (E) of that subsection).
                    ``(D) Definitions.--In this paragraph:
                            ``(i) Applicable percentage.--The term 
                        `applicable percentage' means the higher of--
                                    ``(I) 60 percent; and
                                    ``(II) the Federal medical 
                                assistance percentage for the State (as 
                                defined in section 1905(b)).
                            ``(ii) Applicable benefit level.--
                                    ``(I) In general.--Subject to 
                                subclause (II), the term `applicable 
                                benefit level' means the amount equal 
                                to the maximum cash assistance grant 
                                for a family consisting of 3 
                                individuals under the State program 
                                funded under this part.
                                    ``(II) Rule for states with more 
                                than 1 maximum level.--In the case of a 
                                State that has more than 1 maximum cash 
                                assistance grant level for families 
                                consisting of 3 individuals, the basic 
                                assistance cost shall be the amount 
                                equal to the maximum cash assistance 
                                grant level applicable to the largest 
                                number of families consisting of 3 
                                individuals receiving assistance under 
                                the State program funded under this 
                                part and all programs funded with 
                                qualified State expenditures (as 
                                defined in section 409(a)(7)(B)(i)).
                            ``(iii) Adjusted increase in the number of 
                        families receiving assistance under the state 
                        program funded under this part and all programs 
                        funded with qualified state expenditures.--The 
                        term `adjusted increase in the number of 
                        families receiving assistance under the State 
                        program funded under this part and all programs 
                        funded with qualified State expenditures' means 
                        the increase in--
                                    ``(I) the unduplicated number of 
                                families receiving assistance under the 
                                State program funded under this part 
                                and all programs funded with qualified 
                                State expenditures (as defined in 
                                section 409(a)(7)(B)(i)) in the most 
                                recent month for which data from the 
                                State are available; as compared to
                                    ``(II) the product of--
                                            ``(aa) the lower of the 
                                        average monthly number of 
                                        families receiving such 
                                        assistance in either of the 2 
                                        completed fiscal years 
                                        immediately preceding the 
                                        fiscal year in which the State 
                                        initially qualifies as a needy 
                                        State; and
                                            ``(bb) 1.04.
                    ``(E) Appropriation.--Out of any money in the 
                Treasury of the United States not otherwise 
                appropriated, there is appropriated for the period of 
                fiscal years 2003 through 2007, such sums as are 
                necessary for making contingency fund grants under this 
                subsection in a total amount not to exceed 
                $2,000,000,000.'';
            (2) by redesignating paragraph (4) as paragraph (2); and
            (3) in paragraph (2), as so redesignated--
                    (A) by striking ``(3)(A)'' and inserting ``(1)''; 
                and
                    (B) by striking ``2-month period that begins with 
                any'' and inserting ``fiscal year quarter that includes 
                a''.
    (b) Modification of Definition of Needy State.--Section 403(b), as 
amended by subsection (a), (42 U.S.C. 603(b)) is further amended--
            (1) by striking paragraphs (5) and (6);
            (2) by redesignating paragraphs (7) and (8) as paragraphs 
        (5) and (6), respectively; and
            (3) by inserting after paragraph (2) (as redesignated by 
        subsection (a)(2)) the following:
            ``(3) Initial determination of whether a state qualifies as 
        a needy state.--
                    ``(A) In general.--For purposes of paragraph (1), a 
                State will be initially determined to be a needy State 
                for a month if the State satisfies any of the 
                following:
                            ``(i) The--
                                    ``(I) average rate of total 
                                unemployment in the State for the 
                                period consisting of the most recent 3 
                                months for which data are available has 
                                increased by the lesser of 1.5 
                                percentage points or by 50 percent over 
                                the corresponding 3-month period in 
                                either of the 2 most recent preceding 
                                fiscal years; or
                                    ``(II) average insured unemployment 
                                rate for the most recent 3 months for 
                                which data are available has increased 
                                by 1 percentage point over the 
                                corresponding 3-month period in either 
                                of the 2 most recent preceding fiscal 
                                years.
                            ``(ii) As determined by the Secretary of 
                        Agriculture, the monthly average number of 
                        households (as of the last day of each month) 
                        that participated in the food stamp program in 
                        the State in the then most recently concluded 
                        3-month period for which data are available 
                        exceeds by at least 10 percent the monthly 
                        average number of households (as of the last 
                        day of each month) in the State that 
                        participated in the food stamp program in the 
                        corresponding 3-month period in either of the 2 
                        most recent preceding fiscal years, but only if 
                        the Secretary of Agriculture makes a 
                        determination that the State's increased 
                        caseload was due, in large measure, to economic 
                        conditions rather than changes in Federal or 
                        State policies related to the food stamp 
                        program.
                            ``(iii) As determined by the Secretary, the 
                        monthly average of the unduplicated number of 
                        families that received assistance under the 
                        State program funded under this part and all 
                        programs funded with qualified State 
                        expenditures (as defined in section 
                        409(a)(7)(B)(i)) in the most recently concluded 
                        3-month period for which data are available 
                        from the State increased by at least 10 percent 
                        over the number of such families that received 
                        such benefits in the corresponding 3-month 
                        period in either of the 2 most recent preceding 
                        fiscal years, but only if the Secretary makes a 
                        determination that the State's increased 
                        caseload was due, in large measure, to economic 
                        conditions rather than State policy changes.
                    ``(B) Duration.--
                            ``(i) In general.--A State that qualifies 
                        as a needy State--
                                    ``(I) under subparagraph (A)(i), 
                                shall be considered a needy State until 
                                either the State's (seasonally 
                                adjusted) total unemployment rate or 
                                (seasonally adjusted) insured 
                                unemployment rate, whichever rate was 
                                used to meet the definition as a needy 
                                State under that subparagraph for the 
                                most recently concluded 3-month period 
                                for which data are available, falls 
                                below the level attained in the 3-month 
                                period that was used to first determine 
                                that the State qualified as a needy 
                                State under that subparagraph;
                                    ``(II) under subparagraph (A)(ii), 
                                shall be considered a needy State until 
                                the average monthly number of 
                                households participating in the food 
                                stamp program for the most recently 
                                concluded 3-month period for which data 
                                are available nationally falls below 
                                the food stamp base period level; and
                                    ``(III) under subparagraph 
                                (A)(iii), shall be considered a needy 
                                State until the unduplicated number of 
                                families receiving assistance under the 
                                State program funded under this part 
                                and all programs funded with qualified 
                                State expenditures (as defined in 
                                section 409(a)(7)(B)(i)) for the most 
                                recently concluded 3-month period for 
                                which data are available falls below 
                                the TANF base period level.
                            ``(ii) Seasonal variations.--
                                    ``(I) In general.--Subject to 
                                subclause (II), notwithstanding 
                                subclauses (II) and (III) of clause 
                                (i), a State shall be considered a 
                                needy State--
                                            ``(aa) under subparagraph 
                                        (A)(ii), if with respect to the 
                                        State, the monthly average 
                                        number of households 
                                        participating in the food stamp 
                                        program for the most recent 3-
                                        month period for which data are 
                                        available nationally falls 
                                        below the food stamp base 
                                        period level and the Secretary 
                                        determines that this is due to 
                                        expected seasonal variations in 
                                        food stamp receipt in the 
                                        State; and
                                            ``(bb) under subparagraph 
                                        (A)(iii), if, with respect to a 
                                        State, the monthly average of 
                                        the number of unduplicated 
                                        families receiving assistance 
                                        under the State program funded 
                                        under this part and all 
                                        programs funded with qualified 
                                        State expenditures (as defined 
                                        in section 409(a)(7)(B)(i)) for 
                                        the most recently concluded 3-
                                        month period for which data are 
                                        available nationally falls 
                                        below the TANF base period 
                                        level and the Secretary 
                                        determines that this is due to 
                                        expected seasonal variations in 
                                        assistance receipt in the 
                                        State.
                                    ``(II) Limitations.--A State shall 
                                not be considered a needy State 
                                pursuant to--
                                            ``(aa) item (aa) of 
                                        subclause (I), unless the 
                                        Secretary of Agriculture 
                                        determines that the number of 
                                        households receiving food 
                                        stamps remained at elevated 
                                        levels largely due to economic 
                                        factors; and
                                            ``(bb) item (bb) of 
                                        subclause (II), unless the 
                                        Secretary determines that the 
                                        unduplicated number of families 
                                        receiving assistance under the 
                                        State program funded under this 
                                        part and all programs funded 
                                        with qualified State 
                                        expenditures (as defined in 
                                        section 409(a)(7)(B)(i)) 
                                        remained at elevated levels 
                                        largely due to economic 
                                        factors.
                            ``(iii) Food stamp base period level.--In 
                        this subparagraph, the term `food stamp base 
                        period level' means the monthly average number 
                        of households participating in the food stamp 
                        program that corresponds to the most recent 3-
                        month period for which data are available at 
                        the time when the State first was determined to 
                        be a needy State under this paragraph.
                            ``(iv) TANF base period level.--In this 
                        subparagraph, the term `TANF base period level' 
                        means the monthly average of the unduplicated 
                        number of families receiving assistance under 
                        the State program funded under this part and 
                        all programs funded with qualified State 
                        expenditures (as defined in section 
                        409(a)(7)(B)(i)) that corresponds to the most 
                        recent 3 months for which data are available at 
                        the time when the State first was determined to 
                        be a needy State under this paragraph.
            ``(4) Exceptions.--
                    ``(A) Unexpended balances.--
                            ``(i) In general.--Notwithstanding 
                        paragraph (3), a State that has unexpended TANF 
                        balances in an amount that exceeds 30 percent 
                        of the total amount of grants received by the 
                        State under subsection (a) for the most 
                        recently completed fiscal year (other than 
                        welfare-to-work grants made under paragraph (5) 
                        of that subsection prior to fiscal year 2000), 
                        shall not be a needy State under this 
                        subsection.
                            ``(ii) Definition of unexpended tanf 
                        balances.--In clause (i), the term `unexpended 
                        TANF balances' means the lessor of--
                                    ``(I) the total amount of grants 
                                made to the State (regardless of the 
                                fiscal year in which such funds were 
                                awarded) under subsection (a) (other 
                                than welfare-to-work grants made under 
                                paragraph (5) of that subsection prior 
                                to fiscal year 2000) but not yet 
                                expended as of the end of the fiscal 
                                year preceding the fiscal year for 
                                which the State would, in the absence 
                                of this subparagraph, be considered a 
                                needy State under this subsection; and
                                    ``(II) the total amount of grants 
                                made to the State under subsection (a) 
                                (other than welfare-to-work grants made 
                                under paragraph (5) of that subsection 
                                prior to fiscal year 2000) but not yet 
                                expended as of the end of such 
                                preceding fiscal year, plus the 
                                difference between--
                                            ``(aa) the pro rata share 
                                        of the current fiscal year 
                                        grant to be made under 
                                        subsection (a) to the State; 
                                        and
                                            ``(bb) current year 
                                        expenditures of the total 
                                        amount of grants made to the 
                                        State under subsection (a) 
                                        (regardless of the fiscal year 
                                        in which such funds were 
                                        awarded) (other than such 
                                        welfare-to-work grants) through 
                                        the end of the most recent 
                                        calendar quarter.
                    ``(B) Failure to satisfy maintenance of effort 
                requirement.--Notwithstanding paragraph (3), a State 
                that fails to satisfy the requirement of section 
                409(a)(7) with respect to a fiscal year shall not be a 
                needy State under this subsection for that fiscal 
                year.''.
    (c) Clarification of Reporting Requirements.--Paragraph (6) of 
section 403(b) (42 U.S.C. 603(b)), as redesignated by subsection 
(b)(2), is amended by striking ``on the status of the Fund'' and 
inserting ``on the States that qualified for contingency funds and the 
amount of funding awarded under this subsection''.
    (d) Elimination of Penalty for Failure To Maintain 100 Percent 
Maintenance of Effort.--Section 409(a) (42 U.S.C. 609(a)) is amended--
            (1) by striking paragraph (10); and
            (2) be redesignating paragraphs (11) through (14) as 
        paragraphs (10) through (13), respectively.

SEC. 103. CHILD CARE.

    (a) Mandatory Funding.--
            (1) In general.--Section 418(a) (42 U.S.C. 618(a)) is 
        amended--
                    (A) in paragraph (1), in the matter preceding 
                subparagraph (A), by inserting ``and paragraph (6)'' 
                after ``paragraph (3)'';
                    (B) in paragraph (3)--
                            (i) by striking ``and'' at the end of 
                        subparagraph (E);
                            (ii) in subparagraph (F), by striking 
                        ``fiscal year 2002.'' and inserting ``each of 
                        fiscal years 2002 through 2005; and''; and
                            (iii) by adding at the end the following:
                    ``(G) $2,967,000,000 for each of fiscal years 2006 
                and 2007.'';
                    (C) by striking paragraph (4) and inserting the 
                following:
            ``(4) Amounts reserved.--
                    ``(A) Indian tribes.--The Secretary shall reserve 2 
                percent of the aggregate amount appropriated to carry 
                out this section under paragraphs (3) and (5) for each 
                fiscal year for payments to Indian tribes and tribal 
                organizations for each such fiscal year for the purpose 
                of providing child care assistance.
                    ``(B) Puerto rico.--The Secretary shall reserve 
                $10,000,000 of the amount appropriated under paragraph 
                (5) for each fiscal year for payments to the 
                Commonwealth of Puerto Rico for each such fiscal year 
                for the purpose of providing child care assistance.
                    ``(C) Use of funds; application of child care and 
                development block grant act.--Subsections (b) and (c) 
                apply to amounts received under this paragraph in the 
                same manner as such subsections apply to amounts 
                received by a State under this section.
                    ``(D) No matching requirement.--No matching 
                requirement shall apply to amounts paid under this 
                paragraph for a fiscal year.'';
                    (D) by redesignating paragraph (5) as paragraph 
                (7); and
                    (E) by inserting after paragraph (4) the following:
            ``(5) Additional general entitlement grants.--
                    ``(A) Appropriation.--For additional grants under 
                paragraph (1), there is appropriated $1,000,000,000 for 
                each of fiscal years 2003 through 2007. Amounts 
                appropriated under this subparagraph for a fiscal year 
                shall be in addition to amounts appropriated under 
                paragraph (3) for such fiscal year.
                    ``(B) Additional grant.--In addition to the grant 
                paid to a State under paragraph (1) for each of fiscal 
                years 2003 through 2007, of the amount available for 
                additional grants under subparagraph (A) for a fiscal 
                year, the Secretary shall pay the State an amount equal 
                to the same proportion of such amount as the proportion 
                of the State's grant under paragraph (1) to the amount 
                appropriated under paragraph (3) for such fiscal year.
            ``(6) Requirement for grant increase.--Notwithstanding 
        paragraphs (1), (2), or (5), the aggregate amount paid to a 
        State under this section for each of fiscal years 2003 through 
        2007 may not exceed the aggregate amount paid to the State 
        under this section for fiscal year 2002 unless the State 
        ensures that the level of State expenditures for child care for 
        such fiscal year is not less than the level of State 
        expenditures for child care that were matched under a grant 
        made to the State under paragraph (2) or that the State 
        expended to meet its maintenance of effort obligation under 
        paragraph (2) for fiscal year 2002.''.
            (2) Conforming amendment.--Section 1108(a)(2) (42 U.S.C. 
        1308(a)(2)) is amended by striking ``or 413(f)'' and inserting 
        ``413(f), or 418(a)(4)(B)''.
    (b) Applicability of State or Local Health and Safety Standards to 
Other TANF Child Care Spending.--Section 402(a) (42 U.S.C. 602(a)) is 
amended by adding at the end the following:
            ``(8) Certification of procedures to ensure that child care 
        providers comply with applicable state or local health and 
        safety standards.--A certification by the chief executive 
        officer of the State that procedures are in effect to ensure 
        that any child care provider in the State that provides 
        services for which assistance is provided under the State 
        program funded under this part complies with all applicable 
        State or local health and safety requirements as described in 
        section 658E(c)(2)(F) of the Child Care and Development Block 
        Grant Act of 1990 (other than a relative excluded from the 
        definition of `child care provider' in section 98.41(e) of 
        title 45 of the Code of Federal Regulations (as in effect on 
        June 1, 2002)).''.

SEC. 104. STATE OPTION TO ASSIST LEGAL IMMIGRANT FAMILIES.

    (a) State Option.--
            (1) In general.--Section 403(c)(2) of the Personal 
        Responsibility and Work Opportunity Reconciliation Act of 1996 
        (8 U.S.C. 1613(c)(2)) is amended by adding at the end the 
        following:
                    ``(M) At State option, assistance, benefits, or 
                services under a State program funded under part A of 
                title IV of the Social Security Act (42 U.S.C. 601 et 
                seq.).''.
            (2) Conforming amendment.--Section 408(e) (42 U.S.C. 
        608(e)) is amended to read as follows:
    ``(e) Eligibility of Certain Aliens.--Except as provided in 
subsection (f), at State option, a State may provide assistance, 
benefits, or services to a qualified alien (as defined in subsections 
(b) and (c) of section 431 of the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996 (8 U.S.C. 1641)) under the State 
program funded under this part in the same manner and to the same 
extent as a citizen of the United States would be provided such 
assistance, benefits, or services.''.
    (b) Attribution of Sponsor's Income and Resources to Aliens.--
            (1) In general.--Section 408(f) (42 U.S.C. 608(f)) is 
        amended--
                    (A) in the heading, by striking ``Non-213A'' and 
                inserting ``Sponsored'';
                    (B) by striking ``The following'' and all that 
                follows through the colon and inserting ``The following 
                rules shall apply in determining whether an alien 
                sponsored under section 213A of the Immigration and 
                Nationality Act (and, at the option of the State, a 
                non-213A alien) is eligible for cash assistance under 
                the State program funded under this part, or in 
                determining the amount of such assistance to be 
                provided to a sponsored alien:'';
                    (C) in paragraph (1)--
                            (i) in the matter preceding subparagraph 
                        (A), by striking ``non-213A'' and inserting 
                        ``sponsored'';
                            (ii) in subparagraph (B), by inserting 
                        ``(or, a greater amount as determined by the 
                        State)'' before the period; and
                            (iii) in the heading of subparagraph (C), 
                        by striking ``non-213a'' and inserting 
                        ``sponsored'';
                    (D) by striking paragraph (5) and inserting the 
                following:
            ``(5) Exceptions.--This subsection shall not apply to an 
        alien who is--
                    ``(A) a minor child if the sponsor of the alien or 
                any spouse of the sponsor is a parent of the alien 
                child; or
                    ``(B) described in subsection (e) or (f) of section 
                421 of the Personal Responsibility and Work Opportunity 
                Reconciliation Act of 1996 (8 U.S.C. 1631).''; and
                    (E) by adding at the end the following:
            ``(7) Inapplicability to family members who are not 
        sponsored aliens.--Income and resources of a sponsor which are 
        deemed under this subsection to be the income and resources of 
        any alien individual in a family shall not be considered in 
        determining the need of other family members except to the 
        extent such income or resources are actually available to such 
        other family members.
            ``(8) Rule of construction.--For purposes of section 421 of 
        the Personal Responsibility and Work Opportunity Reconciliation 
        Act of 1996 (8 U.S.C. 1631), the State program funded under 
        this part is not a Federal means-tested public benefits 
        program.''.
            (2) Conforming amendments.--Section 423(d) of the Personal 
        Responsibility and Work Opportunity Reconciliation Act of 1996 
        (8 U.S.C. 1183a note) is amended by adding at the end the 
        following:
            ``(12) Assistance, benefits, or services under part A of 
        title IV of the Social Security Act except for cash assistance 
        provided to a sponsored alien who is subject to deeming 
        pursuant to section 408(f) of that Act.''.
    (c) State Authority To Provide State and Local Public Benefits for 
Certain Aliens.--Section 411(d) of the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996 (8 U.S.C. 1621(d)) is amended--
            (1) in the heading, by inserting ``and Other'' before 
        ``Aliens''; and
            (2) by inserting ``or who otherwise is not a qualified 
        alien (as defined in subsections (b) and (c) of section 431)'' 
        after ``United States''.

SEC. 105. USE OF FUNDS.

    (a) Clarification of Authority of States To Use TANF Funds Carried 
Over From Prior Years To Provide TANF Benefits and Services.--Section 
404(e) (42 U.S.C. 604(e)) is amended to read as follows:
    ``(e) Authority To Carry Over Certain Amounts for Benefits or 
Services or for Future Contingencies.--A State or tribe may use a grant 
made to the State or tribe under this part for any fiscal year to 
provide, without fiscal year limitation, any benefit or service that 
may be provided under the State or tribal program funded under this 
part.''.
    (b) Clarification of Application of Cap on Administrative 
Expenditures.--Section 404(b)(1) (42 U.S.C. 604(b)(1)) is amended by 
inserting ``(determined without regard to any amounts transferred under 
subsection (d))'' after ``of the grant''.
    (c) Elimination of Trust Requirement for Individual Development 
Accounts.--Section 404(h)(3)(A) (42 U.S.C. 604(h)(3)(A)) is amended by 
striking ``a trust created or organized in the United States and''.
    (d) Authority To Transfer TANF Funds To Carry Out an Access to Jobs 
Project or a Reverse Commute Project.--Section 404(d)(1) (42 U.S.C. 
604(d)(1)) is amended by adding at the end the following:
                    ``(C) An access to jobs project or a reverse 
                commute project under a grant made under section 3037 
                of the Transportation Equity Act for the 21st Century 
                (49 U.S.C. 5309 note).''.
    (e) State Option To Establish Postsecondary Education Program.--
Section 404 (42 U.S.C. 604) is amended by adding at the end the 
following:
    ``(l) Authority To Establish Postsecondary Education Program.--
            ``(1) In general.--Subject to paragraph (2), a State to 
        which a grant is made under section 403 may use the grant to 
        establish a program under which an eligible participant (as 
        defined in paragraph (3)) may be provided assistance and other 
        benefits as determined by the State, including support services 
        described in paragraph (5).
            ``(2) No federal funds for tuition.--A State may not use 
        Federal funds provided under a grant made under section 403 to 
        pay tuition for an eligible participant in a program 
        established under this subsection.
            ``(3) Definition of eligible participant.--
                    ``(A) In general.--In this subsection, the term 
                `eligible participant' means an individual eligible for 
                assistance, benefits, or services under the State 
                program funded under this part and satisfies the 
                following requirements:
                            ``(i) The individual is enrolled in a 
                        postsecondary 2- or 4-year degree program.
                            ``(ii) Enrollment in the postsecondary 
                        program is a requirement of the individual's 
                        individual responsibility plan under section 
                        408(b).
                            ``(iii) During the first 24 months that the 
                        individual participates in the postsecondary 
                        program, the individual engages in a 
                        combination of educational activities in 
                        connection with a course of study, training, 
                        study time, employment, or work experience for 
                        an average of not less than 24 hours (20 hours, 
                        in the case of an individual described in 
                        section 407(c)(2)(B)) per week.
                            ``(iv) After the first 24 months of the 
                        individual's participation in the postsecondary 
                        program, the individual--
                                    ``(I) works not less than an 
                                average of 15 hours per week (in 
                                addition to school and study time, and 
                                with priority for hours engaged in work 
                                related to the individual's course of 
                                study); or
                                    ``(II) engages in a combination of 
                                educational activities in connection 
                                with a course of study, training, study 
                                time, employment, or work experience 
                                for an average of not less than 30 
                                hours (20 hours, in the case of an 
                                individual described in section 
                                407(c)(2)(B)) per week.
                            ``(v) During the period the individual 
                        participates in the postsecondary program, the 
                        individual maintains satisfactory academic 
                        progress, as defined by the institution 
                        operating the undergraduate postsecondary 
                        program in which the individual is enrolled.
                    ``(B) Determination of hours.--For purposes of 
                determining hours per week under clause (ii) or (iii) 
                of subparagraph (A), a State may not count study time 
                of less than 1 hour for every hour of class time or 
                more than 2 hours for every hour of class time.
            ``(4) Required time periods for completion of degree.--
                    ``(A) In general.--Subject to subparagraph (B), an 
                individual participating in a program established under 
                this subsection shall be required to complete the 
                requirements of a degree program within the normal 
                timeframe for full time students seeking the particular 
                degree.
                    ``(B) Exception.--For good cause, the State may 
                allow an individual to complete their degree 
                requirements within a period not to exceed 1\1/2\ times 
                the normal timeframe established under subparagraph (A) 
                (unless further modification is required by the 
                Americans with Disabilities Act of 1990 (42 U.S.C. 
                12101 et seq.), or section 504 of the Rehabilitation 
                Act of 1973 (29 U.S.C. 794)) and may modify the 
                requirements applicable to an individual participating 
                in the program. For purposes of the preceding sentence, 
                good cause includes the case of an individual with 1 or 
                more significant barriers to normal participation, as 
                determined by the State, such as the need to care for a 
                family member with special needs.
            ``(5) Support services described.--For purposes of 
        paragraph (1), the support services described in this paragraph 
        include any or all of the following during the period the 
        eligible participant is in the program established under this 
        subsection:
                    ``(A) Child care.
                    ``(B) Transportation services.
                    ``(C) Payment for books and supplies.
                    ``(D) Other services provided under policies 
                determined by the State to ensure coordination and lack 
                of duplication with other programs available to provide 
                support services.''.
    (f) Supplemental Housing Benefits.--Section 404 (42 U.S.C. 604), as 
amended by subsection (d), is amended by adding at the end the 
following:
    ``(m) Use of Funds for Supplemental Housing Benefits.--
            ``(1) In general.--A State to which a grant is made under 
        section 403 may use the grant to provide supplemental housing 
        benefits (as defined in paragraph (4)) in order to carry out 
        the purposes specified in section 401(a).
            ``(2) Not considered assistance.--Supplemental housing 
        benefits (as so defined) shall not for any purpose, be 
        considered assistance under the State program funded under this 
        part.
            ``(3) Limitation on use of funds.--A State may not use any 
        part of the funds made available under a grant made under 
        section 403 to supplant existing State expenditures on housing-
        related programs. Notwithstanding the preceding sentence, a 
        State may use such funds to supplement such State expenditures.
            ``(4) Definition of supplemental housing benefits.--In this 
        subsection, the term `supplemental housing benefits' means 
        payments made to, or on behalf of, an individual with 
        significant annual earnings (as defined by the State) to reduce 
        or reimburse the costs incurred by the individual for housing 
        accommodations.
    ``(n) State Authority To Define Minor Housing Rehabilitation 
Costs.--A State to which a grant is made under section 403 may use the 
grant to provide grants, loans, or to otherwise pay the costs of minor 
rehabilitation of housing owned or rented by individuals eligible for 
assistance under the State program funded under this part, consistent 
with a definition of minor housing rehabilitation adopted by the State 
and incorporated into the State plan required under section 402(a).''.

SEC. 106. DEFINITION OF ASSISTANCE.

    (a) Definition.--Section 419 (42 U.S.C. 619) is amended by adding 
at the end the following:
            ``(6) Assistance.--
                    ``(A) In general.--The term `assistance' means 
                payment, by cash, voucher, or other means, to or for an 
                individual or family for the purpose of meeting a 
                subsistence need of the individual or family (including 
                food, clothing, shelter, and related items, but not 
                including costs of transportation, child care, or 
                supplemental housing benefits (as defined in section 
                404(m)(4)).
                    ``(B) Exception.--The term `assistance' does not 
                include a payment described in subparagraph (A) to or 
                for an individual or family on a short-term, 
                nonrecurring basis (as defined by the State in 
                accordance with regulations prescribed by the 
                Secretary) or any other benefit or service excluded 
                from the definition of assistance under section 260.31 
                of title 45 of the Code of Federal Regulations (as in 
                effect on June 1, 2002).''.
    (b) Conforming Amendments.--
            (1) Section 404(a)(1) (42 U.S.C. 604(a)(1)) is amended by 
        striking ``assistance'' and inserting ``aid''.
            (2) Section 404(f) (42 U.S.C. 604(f)) is amended by 
        striking ``assistance'' and inserting ``benefits or services''.
            (3) Section 408(a)(5)(B)(i) (42 U.S.C. 608(a)(5)(B)(i)) is 
        amended in the heading by striking ``assistance'' and inserting 
        ``aid''.
            (4) Section 5(g)(2)(D) of the Food Stamp Act of 1977 (7 
        U.S.C. 2014(g)(2)(D)) is amended--
                    (A) by striking ``If the vehicle allowance'' and 
                inserting the following:
                            ``(i) In general.--If the vehicle 
                        allowance''; and
                    (B) by adding at the end the following:
                            ``(ii) Definition of assistance.--In clause 
                        (i), the term `assistance' shall have the 
                        meaning given such term in section 260.31 of 
                        title 45 of the Code of Federal Regulations, as 
                        in effect on June 1, 2002.''.

SEC. 107. MAINTENANCE OF EFFORT.

    (a) Inclusion of Child Support Arrearages Distributed to Families 
No Longer Receiving Assistance.--Section 409(a)(7)(B)(i) (42 U.S.C. 
609(a)(7)(B)(i)) is amended--
            (1) in subclause (I)(aa), by striking ``457(a)(1)(B)'' and 
        inserting ``457(a)(1)''; and
            (2) by adding at the end the following:
                                    ``(V) Portions of certain child 
                                support payments collected on behalf of 
                                and distributed to families no longer 
                                receiving assistance.--Any amount paid 
                                by a State pursuant to section 
                                457(a)(2)(B), but only to the extent 
                                that the State properly elects under 
                                section 457(a)(6) to have the payment 
                                considered a qualified State 
                                expenditure.''.
    (b) Reauthorization.--Section 409(a)(7) (42 U.S.C. 609(a)(7)) is 
amended--
            (1) in subparagraph (A) by striking ``fiscal year 1998, 
        1999, 2000, 2001, 2002, or 2003'' and inserting ``fiscal year 
        2003, 2004, 2005, 2006, 2007 or 2008''; and
            (2) in subparagraph (B)(ii)--
                    (A) by inserting ``preceding'' before ``fiscal 
                year''; and
                    (B) by striking ``for fiscal years 1997 through 
                2002,''.

SEC. 108. FUNDING FOR FAMILIES ASSISTED BY A TERRITORY PROGRAM.

    (a) Increase in Mandatory Ceiling Amount.--Section 1108(c)(4) (42 
U.S.C. 1308(c)(4)) is amended--
            (1) in subparagraph (A), by striking ``$107,255,000'' and 
        inserting ``$109,936,375'';
            (2) in subparagraph (B), by striking ``$4,686,000'' and 
        inserting ``$4,803,150'';
            (3) in subparagraph (C), by striking ``$3,554,000'' and 
        inserting ``$3,642,850''; and
            (4) in subparagraph (D), by striking ``$1,000,000'' and 
        inserting ``$1,250,000''.
    (b) Reauthorization of Matching Grants.--Section 1108(b)(2) (42 
U.S.C. 1308(b)(2)) is amended by striking ``fiscal years 1997 through 
2002'' and inserting ``each of fiscal years 2003 through 2007''.

SEC. 109. REPEAL OF FEDERAL LOAN FUND FOR STATE WELFARE PROGRAMS.

    (a) Repeal.--Section 406 (42 U.S.C. 606) is repealed.
    (b) Conforming Amendments.--
            (1) Section 409(a) (42 U.S.C. 609(a)) is amended by 
        striking paragraph (6).
            (2) Section 412 (42 U.S.C. 612) is amended by striking 
        subsection (f) and redesignating subsections (g) through (i) as 
        subsections (f) through (h), respectively.
            (3) Section 1108(a)(2) (42 U.S.C. 1308(a)(2)) is amended by 
        striking ``406,''.

SEC. 110. SOCIAL SERVICES BLOCK GRANT.

    (a) Restoration of Authority To Transfer Up To 10 Percent of TANF 
Funds.--
            (1) In general.--Section 404(d)(2) (42 U.S.C. 604(d)(2)) is 
        amended to read as follows:
            ``(2) Limitation on amount transferable to title xx 
        programs.--A State may use not more than 10 percent of the 
        amount of any grant made to the State under section 403(a) for 
        a fiscal year to carry out State programs pursuant to title 
        XX.''.
            (2) Effective date.--The amendment made by paragraph (1) 
        applies to amounts made available for fiscal year 2003 and each 
        fiscal year thereafter.
    (b) Funding for Fiscal Year 2005.--Section 2003(c)(11) (42 U.S.C. 
1397b(c)(11)) is amended by inserting ``, except that, with respect to 
fiscal year 2005, the amount shall be $1,952,000,000'' after 
``thereafter''.

SEC. 111. TECHNICAL CORRECTIONS.

    (a) Section 404 (42 U.S.C. 604) is amended by striking subsection 
(c).
    (b) Section 409(c)(2) (42 U.S.C. 609(c)(2)) is amended by inserting 
a comma after ``appropriate''.
    (c) Section 411(a)(1)(A)(ii)(III) (42 U.S.C. 611(a)(1)(A)(ii)(III)) 
is amended by striking the last close parenthesis.
    (d) Section 413(j)(2)(A) (42 U.S.C. 613(j)(2)(A)) is amended by 
striking ``section'' and inserting ``sections''.

                             TITLE II--WORK

SEC. 201. UNIVERSAL ENGAGEMENT.

    (a) Modification of Individual Responsibility Plans.--Section 
408(b) (42 U.S.C. 608(b)) is amended to read as follows:
    ``(b) Individual Responsibility Plans.--
            ``(1) Assessment.--The State agency responsible for 
        administering the State program funded under this part shall 
        make an initial screening and assessment of the following for 
        each family with an adult or minor child head of household 
        receiving assistance:
                    ``(A) The education obtained, skills, prior work 
                experience, work readiness, and barriers to work of 
                each adult or minor child head of household recipient 
                of assistance in the family who has attained age 18 or 
                who has not completed high school or obtained a 
                certificate of high school equivalency, and is not 
                attending secondary school.
                    ``(B) The work support, work readiness, and family 
                support services for which families receiving 
                assistance are eligible.
                    ``(C) The well-being of the children in the family 
                and, where appropriate, activities or resources to 
                improve the well-being of the children.
            ``(2) Contents of plans.--
                    ``(A) In general.--On the basis of the screening 
                and assessment required under paragraph (1) for a 
                family with an adult or minor child head of household 
                receiving assistance under the State program funded 
                under this part, the State agency, in consultation with 
                the family, shall develop an individual responsibility 
                plan that--
                            ``(i) establishes for each adult and minor 
                        child head of household recipient a self-
                        sufficiency plan that specifies activities 
                        described in the State plan submitted pursuant 
                        to section 402, including work activities 
                        specified in section 407(d), as appropriate, 
                        that are designed to assist the family in 
                        achieving their maximum degree of self-
                        sufficiency, and that provides for the ongoing 
                        participation of the adult or minor child head 
                        of household recipient in the activities;
                            ``(ii) sets forth the obligations of the 
                        adult or minor child head of household 
                        recipient which may include registering for 
                        work and commencing a search for employment for 
                        a specified number of hours each week;
                            ``(iii) requires, at a minimum, each such 
                        recipient to participate in activities in 
                        accordance with the individual responsibility 
                        plan;
                            ``(iv) sets forth the appropriate 
                        supportive services the State intends to 
                        provide for the family;
                            ``(v) establishes for the family a plan 
                        that addresses the issue of child well-being 
                        and, when appropriate, adolescent well-being, 
                        and that may include services such as domestic 
                        violence counseling, mental health referrals, 
                        and parenting courses; and
                            ``(vi) includes a section designed to 
                        assist the family by informing the family of 
                        the work support assistance for which the 
                        family may be eligible, including (but not 
                        limited to)--
                                    ``(I) the food stamp program 
                                established under the Food Stamp Act of 
                                1977 (7 U.S.C. 2011 et seq.);
                                    ``(II) the medicaid program funded 
                                under title XIX;
                                    ``(III) the State children's health 
                                insurance program funded under title 
                                XXI;
                                    ``(IV) child care funded under the 
                                Child Care Development Block Grant Act 
                                of 1990 (42 U.S.C. 9858 et seq.);
                                    ``(V) the earned income tax credit 
                                under section 32 of the Internal 
                                Revenue Code of 1986;
                                    ``(VI) the low-income home energy 
                                assistance program established under 
                                the Low-Income Home Energy Assistance 
                                Act of 1981 (42 U.S.C. 8621 et seq.);
                                    ``(VII) the special supplemental 
                                nutrition program for women, infants, 
                                and children established under section 
                                17 of the Child Nutrition Act of 1966 
                                (42 U.S.C. 1786);
                                    ``(VIII) programs conducted under 
                                the Workforce Investment Act of 1998 
                                (29 U.S.C. 2801 et seq.); and
                                    ``(IX) low-income housing 
                                assistance programs.
            ``(3) Review.--
                    ``(A) Regular review.--The State agency shall--
                            ``(i) monitor the participation of each 
                        adult recipient in the activities specified in 
                        the individual responsibility plan, and 
                        regularly review the progress of the family 
                        toward self-sufficiency; and
                            ``(ii) upon such a review, revise the plan 
                        and activities required under the plan as the 
                        State deems appropriate in consultation with 
                        the family.
                    ``(B) Prior to the imposition of a sanction.--The 
                State agency shall--
                            ``(i) review the individual responsibility 
                        plan prior to imposing a sanction against the 
                        adult recipient or the family for failure to 
                        comply with a requirement of the plan or the 
                        State program funded under this part; and
                            ``(ii) make a good faith effort (as defined 
                        by the State) to consult with the family as 
                        part of such review.
            ``(4) Timing.--With respect to a family, the State shall 
        comply with this subsection--
                    ``(A) in the case of a family that, as of October 
                1, 2003, is not receiving assistance from the State 
                program funded under this part, not later than 60 days 
                after the family first receives assistance on the basis 
                of the most recent application for the assistance; and
                    ``(B) in the case of a family that, as of such 
                date, is receiving the assistance, not later than 
                September 30, 2004.
            ``(5) Rule of interpretation.--Nothing in this subsection 
        shall preclude a State from requiring participation in work and 
        any other activities the State deems appropriate for helping 
        families achieve self-sufficiency and improving child well-
        being.''.
    (b) Implementation.--
            (1) Development of model screening and assessment tools.--
                    (A) In general.--The Secretary of Health and Human 
                Services shall develop or identify model screening and 
                assessment tools to assist States (at their option) in 
                identifying an individual's barriers to employment or 
                program compliance.
                    (B) Consultation.--The Secretary of Health and 
                Human Services shall develop or identify the model 
                tools required under paragraph (1) in consultation with 
                individuals and groups with expertise in circumstances 
                such as physical or mental impairments (including 
                learning disabilities), substance abuse, limited 
                English proficiency, domestic violence, or the need to 
                care for a family member with a disability.
                    (C) Dissemination.--The Secretary of Health and 
                Human Services shall disseminate the tools developed or 
                identified under this paragraph to States (as defined 
                in section 1101(a)(1) of the Social Security Act (42 
                U.S.C. 1301(a)(1)) for purposes of part A of title IV 
                of such Act) and Indian tribes with programs funded 
                under part A of title IV of the Social Security Act (42 
                U.S.C. 601 et seq.).
            (2) Grants to assist with implementation.--Section 403(a) 
        (42 U.S.C. 603(a)) is amended by adding at the end the 
        following:
            ``(6) Grants to assist with implementation of universal 
        engagement requirements.--
                    ``(A) In general.--Each eligible State shall be 
                entitled to receive from the Secretary, for each of 
                fiscal years 2003 through 2006, a grant under this 
                paragraph to carry out any or all of the following 
                activities:
                            ``(i) To provide training for supervisory 
                        and non-supervisory staff of the State or local 
                        agency with responsibility for the 
                        administration of the State program funded 
                        under this part, including (but not limited to) 
                        training that is designed to improve the 
                        ability of such staff to identify barriers to 
                        employment and indicators of child well-being, 
                        and to improve the understanding of such staff 
                        of program requirements and services funded 
                        under this part and of nondiscrimination and 
                        employment laws for families receiving 
                        assistance under the State program.
                            ``(ii) To improve the communication of 
                        information concerning program requirements to 
                        recipients of, and applicants for, assistance, 
                        including services related to communicating 
                        such information to families with a primary 
                        language other than English.
                            ``(iii) To improve the quality of the 
                        agency workforce.
                            ``(iv) To improve the coordination of 
                        support programs for low-income families.
                            ``(v) To conduct outreach to promote the 
                        enrollment of eligible families in such 
                        programs.
                            ``(vi) To establish advisory review panels 
                        to advise States with respect to improving the 
                        State's policies and procedures for assisting 
                        individuals under the State program funded 
                        under this part who have barriers to work in 
                        accordance with the requirements of 
                        subparagraph (C).
                    ``(B) Amount of grant.--Of the amount appropriated 
                under subparagraph (E) for a fiscal year, the Secretary 
                shall pay each State an amount equal to the same 
                proportion of such amount as the proportion of the 
                number of families receiving assistance under the State 
                program funded under this part to all such families for 
                all States.
                    ``(C) Requirements for advisory review panels.--A 
                State that uses funds provided under a grant made under 
                this paragraph to establish an advisory review panel 
                shall establish such panels consistent with the 
                following:
                            ``(i) Membership.--
                                    ``(I) In general.--The advisory 
                                review panel shall consist of the 
                                following:
                                            ``(aa) At least 1 member 
                                        shall be a representative of 
                                        the State or local agency 
                                        responsible for administering 
                                        the State program funded under 
                                        this part.
                                            ``(bb) At least 1 member 
                                        shall be an employer.
                                            ``(cc) At least 1 member 
                                        shall be a representative of 
                                        other State or local agencies 
                                        with expertise in providing 
                                        services to individuals with 
                                        disabilities or other barriers 
                                        to work, such as vocational 
                                        rehabilitation agencies, the 
                                        State workforce investment 
                                        board established under section 
                                        111 of the Workforce Investment 
                                        Act of 1998 (29 U.S.C. 2821), 
                                        or mental health agencies.
                                            ``(dd) At least 1 member 
                                        shall be a parent with a 
                                        barrier to work who is 
                                        receiving, or who has ceased 
                                        receiving, cash assistance or 
                                        support services under the 
                                        State program funded under this 
                                        part.
                                            ``(ee) At least 1 member 
                                        shall be an individual or 
                                        representative of an entity 
                                        with expertise in designing and 
                                        implementing policies and 
                                        programs to successfully serve 
                                        individuals with barriers to 
                                        work.
                                            ``(ff) At least 1 member 
                                        shall be a representative of an 
                                        organization that represent 
                                        recipients of assistance under 
                                        the State program funded under 
                                        this part or individuals with 
                                        barriers to employment.
                                            ``(gg) At least 1 member 
                                        shall be a representative of 
                                        non-supervisory employees of 
                                        the State or local agency with 
                                        responsibility for the 
                                        administration of the State 
                                        program funded under this part.
                                    ``(I) Chair.--
                                            ``(aa) In general.--Subject 
                                        to item (bb), the chair of the 
                                        advisory review panel shall be 
                                        appointed by the chief 
                                        executive officer of the State.
                                            ``(bb) Limitation.--The 
                                        chair shall not be a State 
                                        employee.
                                    ``(III) Coordination with existing 
                                panels.--A State shall coordinate the 
                                establishment of an advisory review 
                                panel with other advisory panels 
                                established as of October 1, 2002, that 
                                serve recipients of assistance under 
                                the State program funded under this 
                                part.
                            ``(ii) Duties and use of funds.--
                                    ``(I) In general.--In seeking to 
                                improve a State's policies and 
                                procedures for assisting individuals 
                                with barriers to work, an advisory 
                                review panel established with funds 
                                paid under a grant made this paragraph 
                                may hold meetings, hire support staff, 
                                and enter into contracts for 
                                independent evaluations.
                                    ``(II) Site visits; public 
                                hearings.--To the extent it determines 
                                appropriate, an advisory review panel 
                                established under this paragraph may--
                                            ``(aa) conduct site visits 
                                        to State or local agencies 
                                        responsible for administering 
                                        the State program funded under 
                                        this part; and
                                            ``(bb) hold public 
                                        hearings.
                                    ``(III) Expenses.--At the option of 
                                the State, an advisory review panel 
                                established under this paragraph may 
                                reimburse a panel member who is a 
                                recipient, or a former recipient, of 
                                assistance under the State program 
                                funded under this part for reasonable 
                                travel expenses associated with the 
                                member's participation on the panel.
                                    ``(IV) Rule of construction.--
                                            ``(aa) In general.--Nothing 
                                        in this paragraph shall be 
                                        construed as authorizing an 
                                        advisory review panel 
                                        established under this 
                                        paragraph to resolve complaints 
                                        filed by individuals or 
                                        entities related to possible 
                                        violations of laws protecting 
                                        civil rights, to review 
                                        specific individual's claims 
                                        against the State agency 
                                        responsible for administering 
                                        the State program funded under 
                                        this part, or to become 
                                        involved in advising the State 
                                        as to the specific provisions 
                                        that should be included in a 
                                        specific individual's 
                                        individual responsibility plan 
                                        under section 408(b).
                                            ``(bb) Recipient 
                                        participation.--Nothing in item 
                                        (aa) shall prevent an 
                                        individual who is a recipient, 
                                        or a former recipient of 
                                        assistance under the State 
                                        program funded under this part 
                                        from providing the advisory 
                                        review panel with information 
                                        that could help inform the 
                                        panel's deliberations regarding 
                                        improvements that may be needed 
                                        in the State's policies and 
                                        procedures to better meet the 
                                        needs of individuals and 
                                        families with barriers to 
                                        employment.
                            ``(iii) Reports.--An advisory review panel 
                        established under this paragraph shall submit 
                        to the Secretary at least 1 report that 
                        identifies areas in the State where improvement 
                        is needed with respect to the State's policies 
                        and procedures for assisting individuals under 
                        the State program funded under this part who 
                        have barriers to work.
                    ``(D) Inapplicability of section 404.--A grant made 
                under this paragraph shall not be considered a grant 
                made under this section for purposes of section 404.
                    ``(E) Appropriations.--Out of any money in the 
                Treasury of the United States not otherwise 
                appropriated, there is appropriated to carry out this 
                paragraph, $120,000,000 for the period of fiscal years 
                2003 through 2006.''.
            (3) Consultation.--The Secretary of Health and Human 
        Services shall consult with representatives of the National 
        Governors Association, the American Public Human Services 
        Association, and the National Conference of State Legislatures 
        with respect to implementation of the universal engagement 
        requirements under the temporary assistance to needy families 
        program under part A of title IV of the Social Security Act (42 
        U.S.C. 601 et seq.), as added by the amendments made by this 
        section, including--
                    (A) the development of regulations to carry out the 
                amendments made by this section;
                    (B) the provision of technical assistance to States 
                (in participation with the organizations the Secretary 
                is required to consult with under this paragraph) 
                regarding compliance with such requirements; and
                    (C) the model screening tools required to be 
                developed under paragraph (1).
            (4) GAO evaluation and report.--Not later than September 
        30, 2005, the Comptroller General of the United States shall 
        submit a report to the Committee on Ways and Means of the House 
        of Representatives and the Committee on Finance of the Senate 
        evaluating the implementation of the universal engagement 
        provisions under the temporary assistance to needy families 
        program under part A of title IV of the Social Security Act (42 
        U.S.C. 601 et seq.), as added by the amendments made by this 
        section.
    (c) Rules of Construction.--Nothing in this section or the 
amendments made by this section shall be construed--
            (1) as establishing a private right or cause of action 
        against a State for failure to comply with the requirements 
        imposed under this section or the amendments made by this 
        section; or
            (2) as limiting claims that may be available under other 
        Federal or State laws.

SEC. 202. WORK PARTICIPATION REQUIREMENTS.

    (a) Minimum Participation Rates.--The table set forth in section 
407(a)(1) (42 U.S.C. 607(a)(1)) is amended--
            (1) in the item relating to fiscal year 2002--
                    (A) by striking ``or thereafter'' and inserting 
                ``or 2003''; and
                    (B) by striking the period; and
            (2) by adding at the end the following:

                        ``2004.......................             55   
                         2005........................             60   
                         2006........................             65   
                         2007 or thereafter..........          70.''.  

    (b) Elimination of Separate Work Participation Rate for 2-Parent 
Families.--Section 407 (42 U.S.C. 607) is amended--
            (1) in subsection (a)--
                    (A) in the heading of paragraph (1), by striking 
                ``All families'' and inserting ``In general''; and
                    (B) by striking paragraph (2);
            (2) in subsection (b)--
                    (A) by striking paragraph (2);
                    (B) in paragraph (4), by striking ``paragraphs 
                (1)(B) and (2)(B)'' and inserting ``paragraph (1)(B)''; 
                and
                    (C) in paragraph (5), by striking ``rates'' and 
                inserting ``rate''; and
            (3) in subsection (c)--
                    (A) in paragraph (1)--
                            (i) by striking ``General rules.--'' and 
                        all that follows through ``For purposes'' in 
                        subparagraph (A) and inserting ``General 
                        rule.--For purposes''; and
                            (ii) by striking subparagraph (B); and
                    (B) in paragraph (2)(D)--
                            (i) by striking ``paragraphs (1)(B)(i) and 
                        (2)(B) of subsection (b)'' and inserting 
                        ``subsection (b)(1)(B)(i)''; and
                            (ii) by striking ``and in 2-parent 
                        families, respectively,''.
    (c) Making Work Pay.--
            (1) Replacement of caseload reduction credit with 
        employment credit.--
                    (A) Employment credit to reward states in which 
                families leave welfare for work; additional credit for 
                families with higher earnings.--
                            (i) In general.--Section 407(a) (42 U.S.C. 
                        607(a)), as amended by subsection (b)(1)(B), is 
                        further amended by adding at the end the 
                        following:
            ``(2) Employment credit.--
                    ``(A) In general.--In consultation with the States, 
                and subject to subparagraph (C), the Secretary shall 
                prescribe regulations for reducing the minimum 
                participation rate otherwise applicable to a State 
                under this subsection for a fiscal year by the number 
                of percentage points in the employment credit for the 
                State for the fiscal year, as determined by the 
                Secretary--
                            ``(i) using information in the National 
                        Directory of New Hires; and
                            ``(ii) with respect to a recipient of 
                        assistance under the State program funded under 
                        this part who is placed with an employer whose 
                        hiring information is not reported to the 
                        National Directory of New Hires, using 
                        quarterly wage information submitted by the 
                        State to the Secretary not later than such date 
                        as the Secretary shall prescribe in 
                        regulations.
                    ``(B) Calculation of credit.--
                            ``(i) In general.--The employment credit 
                        for a State for a fiscal year is an amount 
                        equal to--
                                    ``(I)(aa) twice the unduplicated 
                                number of families that include an 
                                adult recipient of assistance under the 
                                State program funded under this part, 
                                that ceased to receive such assistance 
                                for at least a 2-month period during 
                                the applicable period (as defined in 
                                clause (iii)), that did not receive 
                                assistance under a separate State-
                                funded program during such 2-month 
                                period, that were employed during the 
                                calendar quarter immediately succeeding 
                                the quarter in which the assistance 
                                under the State program funded under 
                                this part ceased, and that are not 
                                otherwise included in the determination 
                                of a credit against the minimum 
                                participation rate otherwise applicable 
                                to a State under this subsection for a 
                                fiscal year, plus;
                                    ``(bb) at State option, the number 
                                of families that received a 
                                nonrecurring short-term benefit under 
                                the State program funded under this 
                                part during the applicable period (as 
                                so defined), that were employed during 
                                the calendar quarter immediately 
                                succeeding the quarter in which the 
                                nonrecurring short-term benefit was so 
                                received, and that earned at least 
                                $1000 during the applicable period (as 
                                so defined); divided by
                                    ``(II) the average monthly number 
                                of families that include an adult who 
                                received assistance under the State 
                                program funded under this part during 
                                the applicable period (as so defined), 
                                plus, if the State elected the option 
                                under subclause (I)(bb), the number of 
                                families that received a nonrecurring 
                                short-term benefit under the State 
                                program funded under this part during 
                                the applicable period (as so defined).
                            ``(ii) Special rule for former recipients 
                        with higher earnings.--In calculating the 
                        employment credit for a State for a fiscal 
                        year, a family that, with respect to the 
                        quarter in which the family's earnings was 
                        examined during the preceding fiscal year, 
                        earned at least 33 percent of the average 
                        quarterly earnings in the State (determined on 
                        the basis of State unemployment data) shall be 
                        considered to be 1.5 families.
                            ``(iii) Definition of applicable period.--
                        For purposes of this subparagraph, the term 
                        `applicable period' means the most recent 4 
                        quarters for which data are available to the 
                        Secretary providing information on the work 
                        status of--
                                    ``(I) individuals in the quarter 
                                after the individuals ceased receiving 
                                assistance under the State program 
                                funded under this part; and
                                    ``(II) at State option, individuals 
                                in the quarter after the individuals 
                                received a short-term, non recurring 
                                benefit.
                    ``(C) Limitation.--
                            ``(i) In general.--Except with respect to a 
                        State described in clause (ii), the minimum 
                        participation rate applicable to families 
                        receiving assistance under the State program 
                        funded under this part shall not have the 
                        effect of being reduced through the application 
                        of the employment credit determined under 
                        subparagraph (B)(i)(I)(aa) or the inclusion, at 
                        State option, of individuals who receive 
                        substantial child care or transportation 
                        assistance in the determination of the minimum 
                        participation rate under paragraph (1), below--
                                    ``(I) 20 percent, in the case of 
                                fiscal year 2004;
                                    ``(II) 30 percent, in the case of 
                                fiscal year 2005;
                                    ``(III) 40 percent, in the case of 
                                fiscal year 2006; or
                                    ``(IV) 50 percent, in the case of 
                                fiscal year 2007.
                            ``(ii) State described.--Clause (i) shall 
                        not apply to a State that meets at least 2 of 
                        the criteria for being considered a needy State 
                        under section 403(b)(3)(A).
                    ``(D) Quarterly reports.--Not later than 6 months 
                after the end of a fiscal year quarter, the Secretary 
                shall issue a report to Congress and each State for the 
                preceding quarter that includes information regarding 
                the performance of each State on the factors used to 
                determine the employment credit for a State under this 
                paragraph during that quarter, including any option 
                selected by the State.''.
                            (ii) Authority of secretary to use 
                        information in national directory of new 
                        hires.--Section 453(i) (42 U.S.C. 653(i)) is 
                        amended by adding at the end the following:
            ``(5) Calculation of employment credit for purposes of 
        determining state work participation rates under tanf.--The 
        Secretary may use the information in the National Directory of 
        New Hires for purposes of calculating State employment credits 
        pursuant to section 407(a)(2).''.
                    (B) Elimination of caseload reduction credit.--
                Section 407(b) (42 U.S.C. 607(b)), as amended by 
                subsection (b)(2)(A), is further amended by striking 
                paragraph (3) and redesignating paragraphs (4) and (5) 
                as paragraphs (2) and (3), respectively.
            (2) States to receive partial credit toward work 
        participation rate for recipients engaged in part-time work.--
        Section 407(c)(1) (42 U.S.C. 607(c)(1)), as amended by 
        subsection (b)(3)(A), is further amended by adding at the end 
        the following flush sentence: ``For purposes of subsection 
        (b)(1)(B)(i), a family that does not include a recipient who is 
        participating in work activities for an average of 30 hours per 
        week during a month but includes a recipient who is 
        participating in activities described in paragraph (1), (2), 
        (3), (4), (5), (6), (7), (8), (12), or 13(A) of subsection (d) 
        during the month for an average of at least 50 percent of the 
        minimum average number of hours per week specified for the 
        month in the table set forth in this paragraph shall be counted 
        as a percentage of a family that includes an adult or minor 
        child head of household who is engaged in work for the month, 
        which percentage shall be the number of hours for which the 
        recipient participated in such activities during the month 
        divided by the number of hours of such participation required 
        of the recipient under this section for the month.''.
            (3) TANF recipients who qualify for supplemental security 
        income benefits removed from work participation rate 
        calculation for entire year.--Section 407(b)(1)(B)(ii) (42 
        U.S.C. 607(b)(1)(B)(ii)) is amended--
                    (A) in subclause (I), by inserting ``who has not 
                become eligible for supplemental security income 
                benefits under title XVI during the fiscal year'' 
                before the semicolon; and
                    (B) in subclause (II), by inserting ``, and that do 
                not include an adult or minor child head of household 
                who has become eligible for supplemental security 
                income benefits under title XVI during the fiscal 
                year'' before the period.
            (4) State option to include recipients of substantial child 
        care or transportation assistance in work participation rate.--
                    (A) In general.--Section 407(a)(1) (42 U.S.C. 
                607(a)(1)) is amended by inserting ``(including, at the 
                option of the State, a family that includes an adult 
                who is receiving substantial child care or 
                transportation assistance (as defined by the Secretary, 
                in consultation with directors of State programs funded 
                under this part, which definition shall specify for 
                each type of assistance a threshold which is a dollar 
                value or a length of time over which the assistance is 
                received, and take into account large one-time 
                transition payments) except any family taken into 
                account under paragraph (2)(B)(i)(I))'' before the 
                colon.
                    (B) Data collection and reporting.--Section 
                411(a)(1)(A) (42 U.S.C. 611(a)(1)(A)) is amended in the 
                matter preceding clause (i) by inserting ``(including 
                any family with respect to whom the State has exercised 
                its option under section 407(a)(1) or 
                407(a)(2)(B)(i)(I)(bb)'' after ``assistance''.
            (5) Effective date.--
                    (A) In general.--Except as provided in subparagraph 
                (B), the amendments made by this subsection shall take 
                effect on October 1, 2003.
                    (B) State option to phase-in replacement of 
                caseload reduction credit with employment credit and 
                delay applicability of other provisions.--A State may 
                elect to have the amendments made by subsections 
                (a)(2), (b), (c), and (d) not apply to the State 
                program funded under part A of title IV of the Social 
                Security Act until October 1, 2004, and if the State 
                makes the election, then, in determining the 
                participation rate of the State for purposes of 
                sections 407 and 409(a)(3) of the Social Security Act 
                for fiscal year 2004, the State shall be credited with 
                \1/2\ of the reduction in the rate that would otherwise 
                result from applying section 407(a)(2) of the Social 
                Security Act (as added by subsection (c)(1)(A)(i)) to 
                the State for fiscal year 2004 and \1/2\ of the 
                reduction in the rate that would otherwise result from 
                applying section 407(b)(3) of the Social Security Act 
                to the State for fiscal year 2004.
    (d) Increase in Number of Hours Required for Work-Related 
Activities.--Section 407(c)(1) (42 U.S.C. 607(c)(1)), as amended by 
subsection (b)(3), is further amended in the matter preceding the table 
set forth in that paragraph, by striking ``20 hours'' and inserting 
``24 hours''.
    (e) Additional Work Activities.--
            (1) In general.--Section 407(d) (42 U.S.C. 607(d)) is 
        amended--
                    (A) in paragraph (11), by striking ``and'' at the 
                end;
                    (B) in paragraph (12), by striking the period and 
                inserting ``; and''; and
                    (C) by adding at the end the following:
            ``(13)(A) rehabilitative services, such as adult basic 
        education, participation in a program designed to increase 
        proficiency in the English language, or, in the case of an 
        individual determined by a qualified medical, mental health, or 
        social services professional as having a physical or mental 
        disability, substance abuse problem, or other problem that 
        requires rehabilitative services, substance abuse treatment, 
        mental health treatment, or other rehabilitative services, 
        provided that the provision of such services is a requirement 
        of the individual's individual responsibility plan under 
        section 408(b) (not to exceed 3 months out of any 24-month 
        period, or, if such services for a longer period of time is a 
        requirement of the individual's plan under section 408(b), up 
        to 6 months, but only if, during the last 3 months of such 6 
        months, such services are combined with work or job-readiness 
        activities); and
            ``(B) for purposes of counting toward the minimum average 
        number of hours per week specified in the table set forth in 
        subsection (c)(1), services described in subparagraph (A), the 
        provision of which is a requirement of the individual's 
        individual responsibility plan under section 408(b), until an 
        individual successfully completes such services (and without 
        regard to the time limits for the receipt of such services for 
        purposes of subparagraph (A).''.
            (2) Conforming amendments.--Section 407(c)(1) (42 U.S.C. 
        607(c)(1)), as amended by subsections (b) and (d), is further 
        amended by striking ``or (12)'' and inserting ``(12), or 
        (13)(A)''.
    (f) Number of Weeks for Which Job Search Counts as Work.--Section 
407(c)(2)(A)(i) (42 U.S.C. 607(c)(2)(A)(i)) is amended--
            (1) by striking ``6 weeks'' and inserting ``8 weeks'';
            (2) by striking ``403(b)(6)'' and inserting ``403(b)''; and
            (3) by striking ``, or if the participation is for a week 
        that immediately follows 4 consecutive weeks of such 
        participation''.
    (g) Education and Training.--
            (1) Vocational and postsecondary education.--
                    (A) In general.--Section 407(d)(8) is amended to 
                read as follows:
            ``(8) vocational education and training and postsecondary 
        education that is a requirement of the individual's individual 
        responsibility plan under section 408(b) (not to exceed 24 
        months with respect to any individual);''.
                    (B) Elimination of recipients completing secondary 
                school from limit on number of tanf recipients 
                participating in vocational education training.--
                            (i) In general.--Section 407(c)(2)(D) (42 
                        U.S.C. 607(c)(2)(D)) is amended by striking 
                        ``educational training, or (if the month is in 
                        fiscal year 2000 or thereafter) deemed to be 
                        engaged in work for the month by reason of 
                        subparagraph (C) of this paragraph'' and 
                        inserting ``education and training (determined 
                        without regard to any individual described in 
                        subparagraph (C)''.
                            (ii) Conforming amendments.--
                                    (I) Section 407(c)(2)(C)(ii) (42 
                                U.S.C. 607(c)(2)(C)(ii) is amended by 
                                inserting ``including vocational 
                                education and training'' after 
                                ``employment''.
                                    (II) Section 407(c)(2)(D) (42 
                                U.S.C. 607(c)(2)(D)) is amended in the 
                                heading, by striking ``educational 
                                activities'' and inserting ``vocational 
                                education activities''.
            (2) State option to treat participants in postsecondary 
        education program as engaged in work.--
                    (A) In general.--Section 407(c)(2) (42 U.S.C. 
                607(c)(2)) is amended by adding at the end the 
                following:
                    ``(E) State option to treat participants in 
                postsecondary education program as engaged in work.--
                            ``(i) In general.--Subject to clause (ii), 
                        in the case of a State that elects to establish 
                        a postsecondary education program under section 
                        404(l), the State may include, for purposes of 
                        determining monthly participation rates under 
                        subsection (b)(1)(B)(i), all families that 
                        include an individual participating in the 
                        program during the month as being engaged in 
                        work for the month, so long as each such 
                        individual is in compliance with the 
                        requirements of that program.
                            ``(ii) Limitation.--With respect to a 
                        month, the number of families treated as being 
                        engaged in work under clause (i) may not exceed 
                        the amount equal to 10 percent of the average 
                        monthly number of families to which assistance 
                        is provided under the State program funded 
                        under this part during the fiscal year or the 
                        immediately preceding fiscal year (but not 
                        both), as the State may elect.''.
                    (B) Conforming amendments.--
                            (i) Section 407(c)(2)(D) (42 U.S.C. 
                        607(c)(2)(D)), as amended by paragraph 
                        (1)(B)(ii)(II), is amended--
                                    (I) in the heading, by inserting 
                                ``certain'' after ``participation in''; 
                                and
                                    (II) by inserting ``(determined 
                                without regard to individuals 
                                participating in a program referred to 
                                in subparagraph (E)(i))'' after 
                                ``training''.
                            (ii) Section 407(d)(8), as amended by 
                        paragraph (1)(A), is amended inserting ``, or 
                        such longer period as the State may allow for 
                        an individual who is treated as being engaged 
                        in work through participation in a program that 
                        meets the requirements of section 404(l))'' 
                        after ``any individual''.
    (h) State Option To Exempt Full Time Caregiver of a Family Member 
With a Disability From Work Requirements.--Section 407(c)(2) (42 U.S.C. 
607(c)(2)), as amended by subsection (g)(2), is further amended by 
adding at the end the following:
                    ``(F) State option to exempt full time caregiver of 
                a family member with a disability from work 
                requirements.--
                            ``(i) In general.--Subject to clause (ii), 
                        a State may exempt an adult recipient from the 
                        requirement to engage in work in accordance 
                        with this section and may exclude the family of 
                        the recipient from the determination required 
                        under subsection (b)(1)(B)(ii) if--
                                    ``(I) there are no other adults in 
                                the family who are able-bodied;
                                    ``(II) the recipient is the primary 
                                caregiver for a child with a physical 
                                or mental disability or chronic illness 
                                (as defined by the State), or for 
                                another family member with a physical 
                                or mental disability or chronic illness 
                                (as so defined);
                                    ``(III) the State or locality 
                                administering the State program funded 
                                under this part determines that the 
                                demands of caregiving do not allow the 
                                recipient to obtain or retain 
                                employment of at least 30 hours per 
                                week; and
                                    ``(IV) the need to provide 
                                caregiving is specified in the 
                                recipient's individual responsibility 
                                plan established under section 408(b) 
                                and reviewed not less than annually.
                            ``(ii) Limitation.--The average monthly 
                        number of families excluded under clause (i) 
                        from the determination required under 
                        subsection (b)(1)(B)(ii) shall not exceed 10 
                        percent of the average monthly number of 
                        families to which assistance is provided under 
                        the State program funded under this part during 
                        the fiscal year or the immediately preceding 
                        fiscal year (but not both), as the State may 
                        elect.
                            ``(iii) Rules of construction.--
                                    ``(I) Some work activity.--Nothing 
                                in this subparagraph shall be construed 
                                as prohibiting a State from determining 
                                that, taking into consideration the 
                                needs of the child or other family 
                                member with a physical or mental 
                                disability or chronic illness, the 
                                adult recipient caregiver can engage in 
                                some work activity, or another activity 
                                that may lead to work, on a basis that 
                                is less than 30 hours a week. A State 
                                may exclude the family of such a 
                                recipient from the determination 
                                required under subsection (b)(l)(B)(ii) 
                                if the individual meets the 
                                requirements specified in subclauses 
                                (I) through (IV) of clause (i), but 
                                subject to the limitation under clause 
                                (ii).
                                    ``(II) Authority to exempt other 
                                recipient caregivers.--Nothing in this 
                                subparagraph shall be construed as 
                                prohibiting a State from exempting from 
                                the work requirements under this 
                                section an adult recipient who is a 
                                caregiver of a child or other family 
                                member with a physical or mental 
                                disability or chronic illness but who 
                                does not meet the requirements 
                                specified in subclauses (I) through 
                                (IV) of clause (i), except that the 
                                State may not exclude the family of 
                                such a recipient from the determination 
                                required under subsection 
                                (b)(l)(B)(ii).''.
    (i) Limitation on Penalty for Failure of Certain States To Satisfy 
Work Participation Rate.--Section 409(a)(7)(B)(ii) (42 U.S.C. 
609(a)(7)(B)(ii)) is amended by inserting ``(or fails to meet such 
requirements but meets at least 1 of the criteria for being considered 
a needy State under section 403(b)(3)(A))'' after ``year''.

                TITLE III--FAMILY PROMOTION AND SUPPORT

SEC. 301. HEALTHY MARRIAGE PROMOTION GRANTS.

    Section 403(a)(2) (42 U.S.C. 603(a)(2)) is amended to read as 
follows:
            ``(2) Healthy marriage promotion grants.--
                    ``(A) Authority.--
                            ``(i) In general.--The Secretary shall 
                        award grants to States, Indian tribes, and 
                        nonprofit entities for not more than 75 percent 
                        of the cost of developing and implementing 
                        demonstration projects to promote stronger 
                        families, with an emphasis on the promotion of 
                        healthy marriages, through the testing and 
                        evaluation of a wide variety of approaches to 
                        strengthening families.
                            ``(ii) Matching funds.--A State, Indian 
                        tribe, or nonprofit entity awarded a grant 
                        under this paragraph shall provide non-Federal 
                        contributions toward the costs of programs or 
                        activities supported with funds provided under 
                        the grant in an amount equal to not less than 
                        25 percent of the Federal funds provided under 
                        the grant. Such contributions may be provided 
                        in cash or in kind, fairly valued, including 
                        plant, equipment, or services.
                    ``(B) Healthy marriage promotion activities.--Funds 
                provided under a grant awarded under this paragraph 
                shall be used to support any of the following programs 
                or activities:
                            ``(i) Public advertising campaigns on the 
                        value of marriage and the skills needed to 
                        increase marital stability and health.
                            ``(ii) Voluntary marriage education and 
                        marriage skills programs for nonmarried 
                        pregnant women and nonmarried expectant 
                        fathers.
                            ``(iii) Voluntary premarital education and 
                        marriage skills training for engaged couples 
                        and for couples interested in marriage.
                            ``(iv) Voluntary marriage enhancement and 
                        marriage skills training programs for married 
                        couples.
                            ``(v) Marriage mentoring programs that use 
                        married couples as role models and mentors in 
                        at-risk communities.
                            ``(vi) Teen pregnancy prevention programs.
                            ``(vii) Broad-based income support and 
                        supplementation strategies, such as the 
                        strategies implemented under the demonstration 
                        project authorized under section 22 of the Food 
                        Stamp Act of 1977 (7 U.S.C. 2031), that provide 
                        increased assistance to low-income working 
                        families, such as housing, transportation, and 
                        transitional benefits, and that do not exclude 
                        families from participation based on the number 
                        of parents in the household.
                            ``(viii) Development and dissemination of 
                        best practices for addressing domestic and 
                        sexual violence as a barrier to economic 
                        security, including caseworker training, 
                        technical assistance, and voluntary services 
                        for victims.
                    ``(C) Selection of grantees.--
                            ``(i) Requirement.--The Secretary may not 
                        award a grant under this paragraph unless the 
                        State, Indian tribe, or nonprofit entity 
                        receiving the grant--
                                    ``(I) consults with national, 
                                State, local, or tribal organizations 
                                with demonstrated expertise in working 
                                with survivors of domestic violence; 
                                and
                                    ``(II) agrees to participate in the 
                                evaluation conducted under subparagraph 
                                (D).
                            ``(ii) Public comment and availability.--
                                    ``(I) Selection criteria.--The 
                                Secretary shall promulgate regulations 
                                detailing the criteria for awarding 
                                grants under this paragraph and shall 
                                make such regulations available for a 
                                period of public comment.
                                    ``(II) Funded applications.--The 
                                Secretary shall make all grant 
                                applications funded under this 
                                paragraph available to the public.
                    ``(D) Evaluation.--
                            ``(i) In general.--The Director of the 
                        National Academy of Sciences shall conduct, 
                        directly or through contracts, a rigorous 
                        comprehensive evaluation of a representative 
                        sample of the programs and activities described 
                        in subparagraph (B) and carried out with funds 
                        provided under a grant made under this 
                        paragraph. The Director shall seek public input 
                        on both the methods and measures to be used in 
                        the evaluation.
                            ``(ii) Required information.--The 
                        evaluation conducted under this subparagraph 
                        shall, with respect to each program and 
                        activity described in subparagraph (B), include 
                        measures of family structure, levels of family 
                        conflict and violence, and child well-being 
                        (including measures of health status, 
                        educational performance, food security, and 
                        family income).
                            ``(iii) Funding.--$5,000,000 of the amount 
                        appropriated under subparagraph (F) for each 
                        fiscal year shall be reserved for carrying out 
                        the evaluation required under this 
                        subparagraph.
                    ``(E) Reports.--
                            ``(i) Initial report on grants.--Not later 
                        than September 30, 2005, the Secretary shall 
                        submit an initial report to Congress describing 
                        the programs and activities funded under grants 
                        made under this paragraph.
                            ``(ii) Initial evaluation findings.--Not 
                        later than September 30, 2006, the Director of 
                        the National Academy of Sciences shall submit a 
                        report to Congress describing the initial 
                        findings of the evaluation conducted under 
                        subparagraph (D).
                            ``(iii) Final reports.--Not later than 
                        September 30, 2008, the Secretary and the 
                        Director of the National Academy of Sciences 
                        shall each submit final reports on the grants 
                        made under this paragraph and the evaluation 
                        conducted under subparagraph (D), respectively.
                            ``(iv) GAO.--Not later than September 30, 
                        2006, the Comptroller General of the United 
                        States shall submit a report to the Chairman 
                        and Ranking Member of the Committee on Ways and 
                        Means of the House of Representatives and the 
                        Chairman and Ranking Member of the Committee on 
                        Finance of the Senate describing--
                                    ``(I) the process the Secretary 
                                used to award grants under this 
                                paragraph;
                                    ``(II) the programs and activities 
                                supported by such funds; and
                                    ``(II) the results of such programs 
                                and activities.
                    ``(F) Appropriation.--Out of any money in the 
                Treasury of the United States not otherwise 
                appropriated, there is appropriated for each of fiscal 
                years 2003 through 2007, $200,000,000 for grants under 
                this paragraph.''.

SEC. 302. ABSTINENCE EDUCATION.

    (a) Extension of Abstinence Education Funding Under the Maternal 
and Child Health Program.--Section 510(d) (42 U.S.C. 710(d)) is amended 
by striking ``2002'' and inserting ``2007''.
    (b) Grants To Implement Abstinence First Teen Pregnancy Prevention 
Strategies.--
            (1) In general.--Title V (42 U.S.C. 701 et seq.) is amended 
        by adding at the end the following:

   ``grants to implement abstinence first teen pregnancy prevention 
                               strategies

    ``Sec. 511. (a) Authority.--
            ``(1) In general.--The Secretary shall award grants to 
        States and Indian tribes to implement teen pregnancy prevention 
        strategies that--
                    ``(A) are abstinence-first (as defined in paragraph 
                (3)(A);
                    ``(B) replicate or substantially incorporate the 
                elements of 1 or more teen pregnancy prevention 
                programs, including certain youth development programs 
                and service learning programs, that have been proven 
                effective (on the basis of rigorous scientific research 
                (as defined in paragraph (3)(D));
                    ``(C) delay or decrease sexual intercourse or 
                sexual activity and increase contraceptive use among 
                sexually active teens or reduce teenage pregnancies 
                without increasing risky behavior; and
                    ``(D) incorporate outreach or media programs.
            ``(2) Design and implementation flexibility.--States and 
        Indian tribes shall have flexibility to determine how to design 
        and implement teen pregnancy prevention strategies under 
        paragraph (1).
            ``(3) Definitions.--In this section:
                    ``(A) Abstinence-first.--The term `abstinence-
                first' means a strategy that strongly emphasizes 
                abstinence as the best and only certain way to avoid 
                pregnancy and sexually transmitted infections and that 
                discusses the scientifically proven effectiveness, 
                benefits, and limitations of contraception technologies 
                and other prevention approaches in a manner that is 
                medically accurate (as defined in subparagraph (C)).
                    ``(B) Indian tribe.--The term `Indian tribe' has 
                the meaning given that term in section 419(4).
                    ``(C) Medically accurate.--The term `medically 
                accurate' means information that is--
                            ``(i) supported by research recognized as 
                        accurate and objective by leading medical, 
                        psychological, psychiatric, or public health 
                        organizations and agencies; and
                            ``(ii) where relevant, is published in a 
                        peer-reviewed journal (as defined by the 
                        American Medical Association).
                    ``(D) Rigorous scientific research.--The term 
                `rigorous scientific research' means research that 
                typically uses randomized control trials and other 
                similar strong experimental designs.
    ``(b) Application of Other Requirements.--With respect to a grant 
made under this section--
            ``(1) sections 503, 507, and 508 apply to the grant to the 
        same extent and in the same manner as such sections apply to 
        allotments under section 502(c); and
            ``(2) sections 505 and 506 apply to the grant to the extent 
        determined by the Secretary to be appropriate.
    ``(c) Comparative Evaluation of Education Approaches.--
            ``(1) In general.--The Secretary shall, in consultation 
        with an advisory panel of researchers identified by the Board 
        on Children, Youth, and Families of the National Academy of 
        Sciences, conduct an experimental, independent evaluation, 
        directly or through contract or interagency agreement, that 
        assesses the relative efficacy of the 2 approaches to 
        abstinence education established under section 510 and this 
        section.
            ``(2) Design.--The evaluation conducted under paragraph (1) 
        shall be designed to--
                    ``(A) enable a comparison of the efficacy of a 
                program that precludes education about contraception 
                with a similar program that includes education about 
                contraception and means of preventing the transmission 
                of HIV and sexually-transmitted diseases; and
                    ``(B) measure key outcomes, including behaviors 
                that put teens at risk for unintended pregnancy and 
                childbearing and for HIV and other sexually transmitted 
                diseases, such as sexual activity, contraceptive use, 
                condom use and patterns of sexual relationships.
            ``(3) Report.--Not later than 5 years after the date of 
        enactment of this section, the Secretary shall submit a report 
        to Congress that contains the results of the evaluation 
        conducted under paragraph (1).
    ``(d) Appropriations.--
            ``(1) In general.--Out of any money in the Treasury not 
        otherwise appropriated, there is appropriated to the Secretary 
        for the purpose of making grants under this section, 
        $50,000,000 for each of fiscal years 2003 through 2007.
            ``(2) Reservation of funds.--Of the amount appropriated 
        under paragraph (1) for a fiscal year, the Secretary shall 
        reserve--
                    ``(A) an amount equal to 1.5 percent of such amount 
                for each such fiscal year for the purpose of awarding 
                grants to Indian tribes under this section in such 
                manner, and subject to such requirements as the 
                Secretary, in consultation with such tribes, determines 
                appropriate; and
                    ``(B) up to $5,000,000 of such amount for each such 
                fiscal year for the purpose of conducting the 
                evaluation required under subsection (c).''.
            (2) Conforming amendment.--The heading for section 510 (42 
        U.S.C. 710) is amended by striking ``separate program for''.

SEC. 303. TEEN PREGNANCY PREVENTION RESOURCE CENTER.

    Section 413 (42 U.S.C. 613) is amended by adding at the end the 
following:
    ``(k) Teen Pregnancy Prevention Resource Center.--
            ``(1) Authority.--
                    ``(A) In general.--The Secretary shall make a grant 
                to a nationally recognized, nonpartisan, nonprofit 
                organization that meets the requirements described in 
                subparagraph (B) to establish and operate a national 
                teen pregnancy prevention resource center (in this 
                subsection referred to as the `Resource Center') to 
                carry out the purposes and activities described in 
                paragraph (2).
                    ``(B) Requirements.--The requirements described in 
                this subparagraph are the following:
                            ``(i) The organization has at least 5 years 
                        of experience in working with diverse sectors 
                        of society to reduce teen pregnancy.
                            ``(ii) The organization has a demonstrated 
                        ability to work with and provide assistance to 
                        a broad range of individuals and entities, 
                        including teens, parents, the entertainment and 
                        news media, State, tribal, and local 
                        organizations, networks of teen pregnancy 
                        prevention practitioners, businesses, faith and 
                        community leaders, and researchers.
                            ``(iii) The organization is research-based 
                        and has capabilities in scientific analysis and 
                        evaluation.
                            ``(iv) The organization has comprehensive 
                        knowledge and data about teen pregnancy 
                        prevention strategies.
                            ``(v) The organization has experiences 
                        operating a resource center that carries out 
                        activities similar to the activities described 
                        in paragraph (2)(B).
            ``(2) Purposes and activities.--
                    ``(A) Purposes.--The purposes of the Resource 
                Center are to--
                            ``(i) provide information and technical 
                        assistance to States, Indian tribes, local 
                        communities, and other public or private 
                        organizations seeking to reduce rates of teen 
                        pregnancy; and
                            ``(ii) assist such entities in their 
                        efforts to work through all forms of media to 
                        communicate effective messages about preventing 
                        teen pregnancy, including messages that focus 
                        on abstinence, responsible behavior, family 
                        communication, relationships, and values.
                    ``(B) Activities.--The Resource Center shall carry 
                out the purposes described in subparagraph (A) through 
                the following activities:
                            ``(i) Synthesizing and disseminating 
                        research and information regarding effective 
                        and promising practices to prevent teen 
                        pregnancy.
                            ``(ii) Developing and providing information 
                        on how to design and implement effective 
                        programs to prevent teen pregnancy.
                            ``(iii) Helping States, local communities, 
                        and other organizations increase their 
                        knowledge of existing resources that can be 
                        used to advance teen pregnancy prevention 
                        efforts.
                            ``(iv) Linking organizations working to 
                        reduce teen pregnancy with experts and peer 
                        groups, including the creation of technical 
                        assistance networks.
                            ``(v) Providing consultation and resources 
                        on how to reduce teen pregnancy through a broad 
                        array of strategies, including enlisting the 
                        help of various sectors of society such as 
                        parents, other adults (such as coaches and 
                        mentors), community or faith-based groups, the 
                        entertainment and news media, business, and 
                        other teens.
                            ``(vi) Working directly with individuals 
                        and organizations in the entertainment industry 
                        to provide consultation and serve as a source 
                        of factual information on issues related to 
                        teen pregnancy prevention.
            ``(3) Collaboration with other organizations.--The 
        organization operating the Resource Center shall collaborate 
        with other nonprofit organizations that have expertise and 
        interest in teen pregnancy prevention.
            ``(4) Appropriations.--Out of any money in the Treasury of 
        the United States not otherwise appropriated, there is 
        appropriated to carry out this subsection, $5,000,000 for each 
        of fiscal years 2003 through 2007.''.

SEC. 304. RESPONSIBLE FATHERHOOD.

    (a) Noncustodial Parent Employment Grant Program.--Part D of title 
IV (42 U.S.C. 651 et seq.) is amended by adding at the end the 
following:

``SEC. 469C. NONCUSTODIAL PARENT EMPLOYMENT GRANT PROGRAM.

    ``(a) Definitions.--In this section:
            ``(1) Eligible state.--The term `eligible State' means a 
        State that has obtained a commitment from at least 1 county 
        within the State to establish a supervised employment program 
        to provide noncustodial parents described in subsection (b) 
        with an option to participate in that program prior to a court 
        entering a finding that the noncustodial parent is in contempt 
        of court for failure to pay a child support obligation.
            ``(2) Supervised employment program.--The term `supervised 
        employment program' means an employment program supervised by a 
        court or administered by the State agency responsible for 
        administering the State plan under section 454.
    ``(b) Authority To Award Grants.--Subject to the availability of 
appropriations, the Secretary and the Secretary of Labor (in this 
subsection referred to as the `Secretaries') jointly shall award grants 
to eligible States for the purpose of establishing, in coordination 
with counties and other local governments, supervised employment 
programs for noncustodial parents who are determined by a court or the 
State agency responsible for administering the State plan under section 
454 to have a history of nonpayment or irregular payment of child 
support obligations and are determined to be in need of employment 
services in order to pay such child support obligations. A noncustodial 
parent described in the preceding sentence who is an ex-offender shall 
be eligible to participate in a program established with a grant made 
under this subsection.
    ``(c) Administration.--An eligible State that receives a grant 
under this section may contract with a public, private, faith-based or 
community-based organization to administer (in conjunction with the 
court of jurisdiction or State agency responsible for administering the 
State plan under section 454) the supervised employment program.
    ``(d) Program Goals and Requirement.--
            ``(1) Goals.--The goals of a supervised employment program 
        established with funds made available under a grant made under 
        this section shall include the following:
                    ``(A) To assist noncustodial parents described in 
                subsection (b) establish a pattern of regular child 
                support payments by obtaining and maintaining 
                employment.
                    ``(B) To increase the dollar amount and total 
                number of child support orders with collections.
                    ``(C) To help noncustodial parents described in 
                subsection (b) improve relationships with their 
                children.
            ``(2) Requirement.--A supervised employment program 
        established with funds made available under a grant made under 
        this section shall not permit a noncustodial parent placed in 
        the program to graduate from the program and avoid penalties 
        for failure to pay a child support obligation until the 
        noncustodial parent completes at least 6 months of continuous, 
        timely payment of the parent's child support obligations.
    ``(e) Use of Funds.--Services provided under a supervised 
employment program established with funds made available under a grant 
made under this section may include the following:
            ``(1) Job development.
            ``(2) Supervised job search.
            ``(3) Job placement.
            ``(4) Case management.
            ``(5) Court and child support liaison services.
            ``(6) Educational assessment.
            ``(7) Educational referrals.
            ``(8) Vocational assessment.
            ``(9) Counseling on responsible fatherhood and effective 
        parenting.
            ``(10) Support funds for services such as transportation or 
        short-term training.
            ``(11) Referral for support services.
            ``(12) Employment retention services.
            ``(13) Outreach to community agencies that provide bonding 
        programs.
            ``(14) Domestic violence services and health services.
    ``(f) Amount of Grants.--
            ``(1) In general.--The Secretaries shall determine the 
        amount of each grant to be awarded under this section, taking 
        into account the number of counties participating in an 
        eligible State and the population of the noncustodial parents 
        to be served by the employment programs in that State.
            ``(2) Priority for certain programs.--In awarding grants 
        under this section, the Secretaries shall give priority to 
        eligible States with programs that are designed to target 
        noncustodial parents whose income does not exceed 150 percent 
        of the poverty line (as defined in section 673(2) of the 
        Community Services Block Grant Act (42 U.S.C. 9902(2)), 
        including any revision required by such section applicable to a 
        family of the size involved).
            ``(3) Matching requirement.--
                    ``(A) In general.--The Secretaries may not award a 
                grant to an eligible State under this section unless 
                the eligible State agrees that, with respect to the 
                costs to be incurred by the eligible State in 
                supporting the supervised employment program 
                established with funds provided under the grant, the 
                State will make available non-Federal contributions in 
                an amount equal to 25 percent of the amount of Federal 
                funds paid to the State under such grant.
                    ``(B) Non-federal contributions.--In this 
                paragraph, the term `non-Federal contributions' 
                includes contributions by the State and by public and 
                private entities that may be in cash or in kind, but 
                does not include any amounts provided by the Federal 
                Government, or services assisted or subsidized to any 
                significant extent by the Federal Government or any 
                amount expended by a State before October 1, 2002.
    ``(g) Application.--In order to receive a grant under this section, 
an eligible State shall submit an application to the Secretaries, at 
such time and in such manner as the Secretaries may require, and that 
includes the following:
            ``(1) Evidence of an agreement between the State and 1 or 
        more counties to establish a supervised employment program that 
        meets the requirements of this section.
            ``(2) The number of potential noncustodial parents to be 
        served by the program.
            ``(3) The purposes specific to that State's program.
            ``(4) The income of the target population.
            ``(5) The amount of proposed grant funds to be awarded.
            ``(6) A certification that the State matching requirements 
        of subsection (f)(3) will be satisfied if the grant is awarded 
        to that State.
            ``(7) Such other information as the Secretaries deem 
        appropriate.
    ``(h) Authorization of Appropriations.--There is authorized to be 
appropriated for making grants under this section, $25,000,000 for each 
of fiscal years 2004 through 2007.''.
    (b) Policy Reviews and Demonstration Projects To Coordinate 
Services for Low-Income, Noncustodial Parents.--Part D of title IV (42 
U.S.C. 651), as amended by subsection (a), is further amended by adding 
at the end the following:

``SEC. 469D. GRANTS TO CONDUCT POLICY REVIEWS AND DEMONSTRATION 
              PROJECTS TO COORDINATE SERVICES FOR LOW-INCOME, 
              NONCUSTODIAL PARENTS.

    ``(a) Policy Reviews.--Subject to the availability of 
appropriations, the Secretary shall make grants to States desiring to 
conduct policy reviews and develop recommendations with the goals of--
            ``(1) obtaining and retaining employment, increasing child 
        support payments, and increasing the healthy involvement of 
        low-income, noncustodial parents with their children; and
            ``(2) coordinating services for low-income, noncustodial 
        parents among the different systems or programs in which such 
        parents are involved, including the criminal justice system, 
        the State program funded under part A, the State program funded 
        under this part, and job training or employment programs.
    ``(b) Demonstration Projects.--
            ``(1) In general.--The Secretary shall make grants to 
        States desiring to conduct a demonstration project for the 
        purpose of--
                    ``(A) testing innovative policies and to better 
                coordinate policies and services for low-income, 
                noncustodial parents to accomplish the goals described 
                in subsection (a); or
                    ``(B) if the State conducted a policy review with a 
                grant made under subsection (a) and desires to 
                implement the recommendations of that review, 
                implementing such recommendations.
            ``(2) Use of funds.--Funds made available under a grant 
        made under this subsection may be used to provide a wide 
        variety of services to, and to implement policies regarding, 
        low-income, noncustodial parents, including providing economic 
        incentives (with or without penalty) to increase the employment 
        of such parents or to increase the amount of child support paid 
        by such parents.
    ``(c) Application.--A State desiring to receive a grant to conduct 
a policy review under subsection (a) or a grant to conduct a 
demonstration project under subsection (b) shall submit an application 
to the Secretary at such time, in such manner, and containing such 
information as the Secretary may require.
    ``(d) Authorization of Appropriations.--There is authorized to be 
appropriated for making grants under this section, $25,000,000 for each 
of fiscal years 2004 through 2007.''.

SEC. 305. SECOND CHANCE HOMES.

    Section 403(a) (42 U.S.C. 603(a)), as amended by section 201(c)(2), 
is amended by adding at the end the following:
            ``(7) Grants to promote second chance homes.--
                    ``(A) Authority to award grants.--
                            ``(i) In general.--The Secretary may award 
                        grants to eligible entities to enable such 
                        eligible entities to carry out the activities 
                        described in subparagraph (D).
                            ``(ii) Process.--The Secretary shall award 
                        grants under this paragraph on a competitive 
                        basis, after reviewing all applications 
                        submitted under subparagraph (C).
                    ``(B) Eligible entities.--
                            ``(i) In general.--To be eligible to 
                        receive a grant under this paragraph, an entity 
                        shall be--
                                    ``(I) a State;
                                    ``(II) a unit of local government;
                                    ``(III) an Indian tribe; or
                                    ``(IV) a public or private 
                                nonprofit agency, organization, or 
                                institution, or other nonprofit entity, 
                                including a nonprofit urban Indian 
                                organization or an Indian group or 
                                community that is not an Indian tribe.
                            ``(ii) Definition of state.--In this 
                        paragraph, the term `State' means each of the 
                        50 States, the District of Columbia, the 
                        Commonwealth of Puerto Rico, Guam, American 
                        Samoa, the United States Virgin Islands, and 
                        the Commonwealth of the Northern Mariana 
                        Islands.
                    ``(C) Application.--
                            ``(i) In general.--An eligible entity that 
                        desires a grant under this paragraph shall 
                        submit an application to the Secretary at such 
                        time, in such manner, and containing such 
                        information as the Secretary shall reasonably 
                        require.
                            ``(ii) Priority.--In awarding grants under 
                        this paragraph, the Secretary shall give 
                        priority to an eligible entity that submits an 
                        application--
                                    ``(I) proposing to establish a new 
                                second chance home, especially in a 
                                rural area or tribal community;
                                    ``(II) proposing to collaborate 
                                with a nonprofit entity in 
                                establishing, expanding, or enhancing a 
                                second chance home; or
                                    ``(III) demonstrating that the 
                                eligible entity will use funds provided 
                                under a grant made under this section 
                                (other than under this paragraph) to 
                                support a portion of the operating 
                                costs of the applicable second chance 
                                home.
                    ``(D) Use of funds.--
                            ``(i) In general.--An eligible entity that 
                        receives a grant under this paragraph shall use 
                        such grant funds to establish, expand, or 
                        enhance a second chance home.
                            ``(ii) Definition of second chance home.--
                        In this paragraph, the term `second chance 
                        home' means a community-based, adult-supervised 
                        group home that provides young mothers and 
                        their children with a supportive and supervised 
                        living arrangement in which such mothers are 
                        required to learn parenting skills, including 
                        child development, family budgeting, health and 
                        nutrition, and other skills to promote their 
                        long-term economic independence and the well-
                        being of their children.
                            ``(iii) Requirement.--A second chance home 
                        that receives grant funds under this paragraph 
                        shall provide services to mothers who are not 
                        more than 23 years of age and their children.
                    ``(E) Matching funds.--The Secretary shall not 
                award a grant to an eligible entity under this 
                paragraph unless the eligible entity agrees that, with 
                respect to the costs to be incurred in carrying out the 
                activities for which the grant was awarded, the 
                eligible entity will make available non-Federal 
                contributions in an amount equal to not less than 20 
                percent of the Federal funds provided under the grant. 
                Such contributions may be provided in cash or in kind, 
                fairly valued, including plant, equipment, or services.
                    ``(F) Duration.--A grant shall be awarded under 
                this paragraph for a period of 5 years.
                    ``(G) Contract for evaluation.--
                            ``(i) In general.--The Secretary shall 
                        enter into a contract with a public or private 
                        entity for the evaluation of the second chance 
                        homes that are supported by grants awarded 
                        under this paragraph.
                            ``(ii) Information.--The evaluation shall 
                        include the collection of information about the 
                        relevant characteristics of individuals who 
                        benefit from second chance homes such as those 
                        that are supported by grant funds under this 
                        paragraph and what services provided by such 
                        second chance homes are most beneficial to such 
                        individuals.
                            ``(iii) Report.--
                                    ``(I) In general.--The entity 
                                conducting the evaluation under this 
                                subparagraph shall submit to Congress 
                                an interim report and a final report in 
                                accordance with subclause (II) 
                                containing the results of the 
                                evaluation.
                                    ``(II) Date.--
                                            ``(aa) Interim report.--The 
                                        interim report shall be 
                                        submitted not later than 2 
                                        years after the date on which 
                                        the entity enters into a 
                                        contract.
                                            ``(bb) Final report.--The 
                                        final report shall be submitted 
                                        not later than 5 years after 
                                        the date on which the entity 
                                        enters into a contract.
                            ``(iv) Reservation of funds.--From amounts 
                        appropriated in accordance with subparagraph 
                        (I) for fiscal year 2004, the Secretary shall 
                        reserve $1,000,000 to carry out the evaluation 
                        required under this subparagraph.
                    ``(H) Technical assistance.--
                            ``(i) In general.--From amounts 
                        appropriated under subparagraph (I)(i), the 
                        Secretary may use an amount not to exceed 
                        $500,000 to enter into a contract, with a 
                        public or private entity, for the provision of 
                        technical assistance to eligible entities 
                        receiving grant funds under this paragraph.
                            ``(ii) Conferences.--The technical 
                        assistance provided under this subparagraph may 
                        include conferences for the purpose of 
                        disseminating information concerning best 
                        practices for second chance homes.
                    ``(I) Authorization of appropriations.--
                            ``(i) In general.--There is authorized to 
                        be appropriated to carry out this paragraph, 
                        $33,000,000 for each of fiscal years 2004 
                        through 2007.
                            ``(ii) Availability.--Any amounts 
                        appropriated under the authority of clause (i) 
                        shall remain available until expended.''.

                       TITLE IV--HEALTH COVERAGE

SEC. 401. 5-YEAR EXTENSION AND SIMPLIFICATION OF THE TRANSITIONAL 
              MEDICAL ASSISTANCE PROGRAM (TMA).

    (a) Option of Continuous Eligibility for 12 Months; Option of 
Continuing Coverage for Up To an Additional Year.--
            (1) Option of continuous eligibility for 12 months by 
        making reporting requirements optional.--Section 1925(b) (42 
        U.S.C. 1396r-6(b)) is amended--
                    (A) in paragraph (1), by inserting ``, at the 
                option of a State,'' after ``and which'';
                    (B) in paragraph (2)(A), by inserting ``Subject to 
                subparagraph (C):'' after ``(A) Notices.--'';
                    (C) in paragraph (2)(B), by inserting ``Subject to 
                subparagraph (C):'' after ``(B) Reporting 
                requirements.--'';
                    (D) by adding at the end the following new 
                subparagraph:
                    ``(C) State option to waive notice and reporting 
                requirements.--A State may waive some or all of the 
                reporting requirements under clauses (i) and (ii) of 
                subparagraph (B). Insofar as it waives such a reporting 
                requirement, the State need not provide for a notice 
                under subparagraph (A) relating to such requirement.''; 
                and
                    (E) in paragraph (3)(A)(iii), by inserting ``the 
                State has not waived under paragraph (2)(C) the 
                reporting requirement with respect to such month under 
                paragraph (2)(B) and if'' after ``6-month period if''.
            (2) State option to extend eligibility for low-income 
        individuals for up to 12 additional months.--Section 1925 (42 
        U.S.C. 1396r-6) is further amended--
                    (A) by redesignating subsections (c) through (f) as 
                subsections (d) through (g), respectively; and
                    (B) by inserting after subsection (b) the following 
                new subsection:
    ``(c) State Option of Up To 12 Months of Additional Eligibility.--
            ``(1) In general.--Notwithstanding any other provision of 
        this title, each State plan approved under this title may 
        provide, at the option of the State, that the State shall offer 
        to each family which received assistance during the entire 6-
        month period under subsection (b) and which meets the 
        applicable requirement of paragraph (2), in the last month of 
        the period the option of extending coverage under this 
        subsection for the succeeding period not to exceed 12 months.
            ``(2) Income restriction.--The option under paragraph (1) 
        shall not be made available to a family for a succeeding period 
        unless the State determines that the family's average gross 
        monthly earnings (less such costs for such child care as is 
        necessary for the employment of the caretaker relative) as of 
        the end of the 6-month period under subsection (b) does not 
        exceed 185 percent of the official poverty line (as defined by 
        the Office of Management and Budget, and revised annually in 
        accordance with section 673(2) of the Omnibus Budget 
        Reconciliation Act of 1981) applicable to a family of the size 
        involved.
            ``(3) Application of extension rules.--The provisions of 
        paragraphs (2), (3), (4), and (5) of subsection (b) shall apply 
        to the extension provided under this subsection in the same 
        manner as they apply to the extension provided under subsection 
        (b)(1), except that for purposes of this subsection--
                    ``(A) any reference to a 6-month period under 
                subsection (b)(1) is deemed a reference to the 
                extension period provided under paragraph (1) and any 
                deadlines for any notices or reporting and the premium 
                payment periods shall be modified to correspond to the 
                appropriate calendar quarters of coverage provided 
                under this subsection; and
                    ``(B) any reference to a provision of subsection 
                (a) or (b) is deemed a reference to the corresponding 
                provision of subsection (b) or of this subsection, 
                respectively.''.
    (b) State Option To Waive Receipt of Medicaid for 3 of Previous 6 
Months To Qualify for TMA.--Section 1925(a)(1) (42 U.S.C. 1396r-
6(a)(1)) is amended by adding at the end the following: ``A State may, 
at its option, also apply the previous sentence in the case of a family 
that was receiving such aid for fewer than 3 months, or that had 
applied for and was eligible for such aid for fewer than 3 months, 
during the 6 immediately preceding months described in such 
sentence.''.
    (c) 5-Year Extension of Sunset for TMA.--
            (1) In general.--Subsection (g) of section 1925 (42 U.S.C. 
        1396r-6), as redesignated under subsection (a)(2)(A), is 
        further redesignated as subsection (i) and is amended by 
        striking ``2002'' and inserting ``2007''.
            (2) Conforming amendment.--Section 1902(e)(1)(B) (42 U.S.C. 
        1396a(e)(1)(B)) is amended by striking ``2002'' and inserting 
        ``2007''.
    (d) CMS Report on Enrollment and Participation Rates Under TMA.--
Section 1925 (42 U.S.C. 1396r-6), as amended by subsections (a)(2)(A) 
and (c), is amended by inserting after subsection (f) the following:
    ``(g) Additional Provisions.--
            ``(1) Collection and reporting of participation 
        information.--Each State shall--
                    ``(A) collect and submit to the Secretary, in a 
                format specified by the Secretary, information on 
                average monthly enrollment and average monthly 
                participation rates for adults and children under this 
                section; and
                    ``(B) make such information publicly available.
        Such information shall be submitted under subparagraph (A) at 
        the same time and frequency in which other enrollment 
        information under this title is submitted to the Secretary. 
        Using such information, the Secretary shall submit to Congress 
        annual reports concerning such rates.''.
    (e) Coordination of Work.--Section 1925(g) (42 U.S.C. 1396r-6(g)), 
as added by subsection (d), is amended by adding at the end the 
following new paragraph:
            ``(2) Coordination with administration for children and 
        families.--The Administrator of the Centers for Medicare & 
        Medicaid Services, in carrying out this section, shall work 
        with the Assistant Secretary for the Administration for 
        Children and Families to develop guidance or other technical 
        assistance for States regarding best practices in guaranteeing 
        access to transitional medical assistance under this 
        section.''.
    (f) Elimination of TMA Requirement for States That Extend Coverage 
to Children and Parents Through 185 Percent of Poverty.--
            (1) In general.--Section 1925 (42 U.S.C. 1396r-6) is 
        further amended by inserting after subsection (g), as added by 
        subsection (d), the following:
    ``(h) Provisions Optional for States That Extend Coverage to 
Children and Parents Through 185 Percent of Poverty.--A State may meet 
(but is not required to meet) the requirements of subsections (a) and 
(b) if it provides for medical assistance under section 1931 to 
families (including both children and caretaker relatives) the average 
gross monthly earning of which (less such costs for such child care as 
is necessary for the employment of a caretaker relative) is at or below 
a level that is at least 185 percent of the official poverty line (as 
defined by the Office of Management and Budget, and revised annually in 
accordance with section 673(2) of the Omnibus Budget Reconciliation Act 
of 1981) applicable to a family of the size involved.''.
            (2) Conforming amendments.--Section 1925 (42 U.S.C. 1396r-
        6) is further amended, in subsections (a)(1) and (b)(1), by 
        inserting ``, but subject to subsection (h),'' after 
        ``Notwithstanding any other provision of this title,'' each 
        place it appears.
    (g) Requirement of Notice for All Families Losing TANF.--Subsection 
(a)(2) of section 1925 (42 U.S.C. 1396r-6) is amended by adding at the 
end the following flush sentences:
        ``Each State shall provide, to families whose aid under part A 
        or E of title IV has terminated but whose eligibility for 
        medical assistance under this title continues, written notice 
        of their ongoing eligibility for such medical assistance. If a 
        State makes a determination that any member of a family whose 
        aid under part A or E of title IV is being terminated is also 
        no longer eligible for medical assistance under this title, the 
        notice of such determination shall be supplemented by a 1-page 
        notification form describing the different ways in which 
        individuals and families may qualify for such medical 
        assistance and explaining that individuals and families do not 
        have to be receiving aid under part A or E of title IV in order 
        to qualify for such medical assistance. Such notice shall 
        further be supplemented by information on how to apply for 
        child health assistance under the State children's health 
        insurance program under title XXI and how to apply for medical 
        assistance under this title.''.
    (h) Extending Use of Outstationed Workers To Accept Applications 
for Transitional Medical Assistance.--Section 1902(a)(55) (42 U.S.C. 
1396a(a)(55)) is amended by inserting ``and under section 1931'' after 
``(a)(10)(A)(ii)(IX)''.
    (i) Effective Dates.--
            (1) In general.--Except as provided in this subsection, the 
        amendments made by this section shall apply to calendar 
        quarters beginning on or after October 1, 2002, without regard 
        to whether or not final regulations to carry out such 
        amendments have been promulgated by such date.
            (2) Notice.--The amendment made by subsection (g) shall 
        take effect 6 months after the date of enactment of this Act.
            (3) Delay permitted for state plan amendment.--In the case 
        of a State plan for medical assistance under title XIX of the 
        Social Security Act which the Secretary of Health and Human 
        Services determines requires State legislation (other than 
        legislation appropriating funds) in order for the plan to meet 
        the additional requirements imposed by the amendments made by 
        this section, the State plan shall not be regarded as failing 
        to comply with the requirements of such title solely on the 
        basis of its failure to meet these additional requirements 
        before the first day of the first calendar quarter beginning 
        after the close of the first regular session of the State 
        legislature that begins after the date of enactment of this 
        Act. For purposes of the previous sentence, in the case of a 
        State that has a 2-year legislative session, each year of such 
        session shall be deemed to be a separate regular session of the 
        State legislature.

SEC. 402. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS UNDER THE MEDICAID 
              PROGRAM AND TITLE XXI.

    (a) Medicaid Program.--Section 1903(v) (42 U.S.C. 1396b(v)) is 
amended--
            (1) in paragraph (1), by striking ``paragraph (2)'' and 
        inserting ``paragraphs (2) and (4)''; and
            (2) by adding at the end the following:
    ``(4)(A) A State may elect (in a plan amendment under this title) 
to provide medical assistance under this title (including under a 
waiver authorized by the Secretary), notwithstanding sections 401(a), 
402(b), 403, and 421 of the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996, for aliens who are lawfully 
residing in the United States (including battered aliens described in 
section 431(c) of such Act) and who are otherwise eligible for such 
assistance, within any of the following eligibility categories:
            ``(i) Pregnant women.--Women during pregnancy (and during 
        the 60-day period beginning on the last day of the pregnancy).
            ``(ii) Children.--Children (as defined under such plan), 
        including optional targeted low-income children described in 
        section 1905(u)(2)(B).
    ``(B) In the case of a State that has elected to provide medical 
assistance to a category of aliens under subparagraph (A), no debt 
shall accrue under an affidavit of support against any sponsor of such 
an alien on the basis of provision of assistance to such category and 
the cost of such assistance shall not be considered as an unreimbursed 
cost.''.
    (b) Title XXI.--Section 2107(e)(1) (42 U.S.C. 1397gg(e)(1)) is 
amended by adding at the end the following:
                    ``(E) Section 1903(v)(4) (relating to optional 
                coverage of categories of lawful resident alien 
                pregnant women and children), but only with respect to 
                an eligibility category under this title, if the same 
                eligibility category has been elected under such 
                section for purposes of title XIX.''.
    (c) Effective Date.--The amendments made by this section take 
effect on October 1, 2002, and apply to medical assistance and child 
health assistance furnished on or after such date, whether or not 
regulations implementing such amendments have been issued.

SEC. 403. CLARIFICATION OF AUTHORITY OF STATES AND LOCAL AUTHORITIES TO 
              PROVIDE HEALTH CARE TO IMMIGRANTS.

    (a) In General.--Section 411 of the Personal Responsibility and 
Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1621) is 
amended--
            (1) in subsection (b)--
                    (A) by striking paragraphs (1) and (3); and
                    (B) by redesignating paragraphs (2) and (4) as 
                paragraphs (1) and (2), respectively; and
            (2) in subsection (c)--
                    (A) in paragraph (1)--
                            (i) in the matter preceding subparagraph 
                        (A), by striking ``(2) and (3)'' and inserting 
                        ``(2), (3), and (4)''; and
                            (ii) in subparagraph (B), by striking 
                        ``health,''; and
                    (B) by adding at the end the following new 
                paragraph
            ``(4) Such term does not include any health benefit for 
        which payments or assistance are provided to an individual, 
        household, or family eligibility unit by an agency of a State 
        or local government or by appropriated funds of a State or 
        local government.''.
    (b) Effective Date.--The amendments made by subsection (a) shall 
apply to health care furnished before, on, or after the date of 
enactment of this Act.

SEC. 404. CLARIFICATION OF NO VERIFICATION REQUIREMENT FOR NONPROFIT 
              CHARITABLE ORGANIZATIONS.

    Section 432(d) of the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996 (8 U.S.C. 1642(d)) is amended--
            (1) by striking ``Subject to subsection (a), a'' and 
        inserting ``A'';
            (2) by striking ``is not'' and inserting ``shall not be''; 
        and
            (3) by inserting ``or under section 1137 of the Social 
        Security Act (42 U.S.C. 1320b-7)'' after ``this title''.

                TITLE V--CHILD SUPPORT AND CHILD WELFARE

SEC. 501. DISTRIBUTION OF CHILD SUPPORT COLLECTED BY STATES.

    (a) Modification of Rule Requiring Assignment of Support Rights as 
a Condition of Receiving TANF.--Section 408(a)(3) (42 U.S.C. 608(a)(3)) 
is amended to read as follows:
            ``(3) No assistance for families not assigning certain 
        support rights to the state.--A State to which a grant is made 
        under section 403 shall require, as a condition of paying 
        assistance to a family under the State program funded under 
        this part, that a member of the family assign to the State any 
        right the family member may have (on behalf of the family 
        member or of any other person for whom the family member has 
        applied for or is receiving such assistance) to support from 
        any other person, not exceeding the total amount of assistance 
        so paid to the family, which accrues during the period that the 
        family receives assistance under the program.''.
    (b) Increasing Child Support Payments to Families and Simplifying 
Child Support Distribution Rules.--
            (1) Distribution rules.--
                    (A) In general.--Section 457(a) (42 U.S.C. 657(a)) 
                is amended to read as follows:
    ``(a) In General.--Subject to subsections (e) and (f), the amounts 
collected on behalf of a family as support by a State pursuant to a 
plan approved under this part shall be distributed as follows:
            ``(1) Families receiving assistance.--In the case of a 
        family receiving assistance from the State, the State shall--
                    ``(A) pay to the Federal Government the Federal 
                share of the amount collected, subject to paragraph 
                (3)(A);
                    ``(B) retain, or pay to the family, the State share 
                of the amount collected, subject to paragraph (3)(B); 
                and
                    ``(C) pay to the family any remaining amount.
            ``(2) Families that formerly received assistance.--In the 
        case of a family that formerly received assistance from the 
        State:
                    ``(A) Current support.--To the extent that the 
                amount collected does not exceed the current support 
                amount, the State shall pay the amount to the family.
                    ``(B) Arrearages.--Except as otherwise provided in 
                an election made under section 454(34), to the extent 
                that the amount collected exceeds the current support 
                amount, the State--
                            ``(i) shall first pay to the family the 
                        excess amount, to the extent necessary to 
                        satisfy support arrearages not assigned 
                        pursuant to section 408(a)(3);
                            ``(ii) if the amount collected exceeds the 
                        amount required to be paid to the family under 
                        clause (i), shall--
                                    ``(I) pay to the Federal 
                                Government, the Federal share of the 
                                excess amount described in this clause, 
                                subject to paragraph (3)(A); and
                                    ``(II) retain, or pay to the 
                                family, the State share of the excess 
                                amount described in this clause, 
                                subject to paragraph (3)(B); and
                            ``(iii) shall pay to the family any 
                        remaining amount.
            ``(3) Limitations.--
                    ``(A) Federal reimbursements.--The total of the 
                amounts paid by the State to the Federal Government 
                under paragraphs (1) and (2) of this subsection with 
                respect to a family shall not exceed the Federal share 
                of the amount assigned with respect to the family 
                pursuant to section 408(a)(3).
                    ``(B) State reimbursements.--The total of the 
                amounts retained by the State under paragraphs (1) and 
                (2) of this subsection with respect to a family shall 
                not exceed the State share of the amount assigned with 
                respect to the family pursuant to section 408(a)(3).
            ``(4) Families that never received assistance.--In the case 
        of any other family, the State shall pay the amount collected 
        to the family.
            ``(5) Families under certain agreements.--Notwithstanding 
        paragraphs (1) through (3), 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 
        collected pursuant to the terms of the agreement.
            ``(6) State financing options.--To the extent that the 
        State's share of the amount payable to a family pursuant to 
        paragraph (2)(B) of this subsection exceeds the amount that the 
        State estimates (under procedures approved by the Secretary) 
        would have been payable to the family pursuant to former 
        section 457(a)(2)(B) (as in effect for the State immediately 
        before the date this subsection first applies to the State) if 
        such former section had remained in effect, the State may elect 
        to use the grant made to the State under section 403(a) to pay 
        the amount, or to have the payment considered a qualified State 
        expenditure for purposes of section 409(a)(7)(B)(i), but not 
        both.
            ``(7) State option to pass through additional support with 
        federal cost-sharing.--
                    ``(A) In general.--Notwithstanding paragraph (2), a 
                State shall not be required to pay to the Federal 
                Government the Federal share of an amount collected on 
                behalf of a family that formerly received assistance 
                under the State program funded under part A, to the 
                extent that the State pays the amount to the family.
                    ``(B) Recipients of tanf for less than 5 years.--
                            ``(i) In general.--Notwithstanding 
                        paragraph (1), a State shall not be required to 
                        pay to the Federal Government the Federal share 
                        of an amount collected on behalf of a family 
                        that is a recipient of assistance under the 
                        State program funded under part A and, if the 
                        family includes an adult, that has received the 
                        assistance for not more than 5 years after the 
                        date of enactment of this paragraph, to the 
                        extent that--
                                    ``(I) the State pays the amount to 
                                the family; and
                                    ``(II) subject to clause (ii), the 
                                amount is disregarded in determining 
                                the amount and type of the assistance 
                                provided to the family.
                            ``(ii) Limitation.--Of the amount 
                        disregarded as described in clause (i)(II), the 
                        maximum amount that may be taken into account 
                        for purposes of clause (i) shall not exceed 
                        $400 per month, except that, in the case of a 
                        family that includes 2 or more children, the 
                        State may elect to increase the maximum amount 
                        to not more than $600 per month.
            ``(8) States with demonstration waivers.--Notwithstanding 
        the preceding paragraphs, a State with a waiver under section 
        1115, effective on or before October 1, 1997, the terms of 
        which allow pass-through of child support payments, may pass 
        through payments in accordance with such terms with respect to 
        families subject to the waiver.''.
                    (B) State plan to include election as to which 
                rules to apply in distributing child support arrearages 
                collected on behalf of families formerly receiving 
                assistance.--Section 454 (42 U.S.C. 654) is amended--
                            (i) by striking ``and'' at the end of 
                        paragraph (32);
                            (ii) by striking the period at the end of 
                        paragraph (33) and inserting ``; and''; and
                            (iii) by inserting after paragraph (33) the 
                        following:
            ``(34) include an election by the State to apply section 
        457(a)(2)(B) of this Act or former section 457(a)(2)(B) of this 
        Act (as in effect for the State immediately before the date 
        this paragraph first applies to the State) to the distribution 
        of the amounts which are the subject of such sections, and for 
        so long as the State elects to so apply such former section, 
        the amendments made by subsection (e) of section 501 of the 
        Work, Opportunity, and Responsibility for Kids Act of 2002 
        shall not apply with respect to the State, notwithstanding 
        subsection (f)(1) of such section 501.''.
                    (C) Approval of estimation procedures.--Not later 
                than October 1, 2003, the Secretary of Health and Human 
                Services, in consultation with the States (as defined 
                for purposes of part D of title IV of the Social 
                Security Act), shall establish the procedures to be 
                used to make the estimate described in section 
                457(a)(6) of such Act.
            (2) Current support amount defined.--Section 457(c) (42 
        U.S.C. 657(c)) is amended by adding at the end the following:
            ``(5) Current support amount.--The term `current support 
        amount' means, with respect to amounts collected as support on 
        behalf of a family, the amount designated as the monthly 
        support obligation of the noncustodial parent in the order 
        requiring the support.''.
    (c) Ban on Recovery of Medicaid Costs for Certain Births.--
            (1) In general.--Section 454 (42 U.S.C. 654) as amended by 
        subsection (b)(1)(B), is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (33);
                    (B) by striking the period at the end of paragraph 
                (34) and inserting ``; and''; and
                    (C) by inserting after paragraph (34) the 
                following:
            ``(35) provide that the State shall not use the State 
        program operated under this part to collect any amount owed to 
        the State by reason of costs incurred under the State plan 
        approved under title XIX for the birth of a child for whom 
        support rights have been assigned pursuant to section 
        408(a)(3), 471(a)(17), or 1912.''.
            (2) Effective date.--The amendments made by paragraph (1) 
        shall take effect on October 1, 2004.
    (d) State Option To Discontinue Pre-1997 Support Assignments.--
Section 457(b) (42 U.S.C. 657(b)) is amended by striking ``shall'' and 
inserting ``may''.
    (e) Conforming Amendments.--Section 404(a) (42 U.S.C. 604(a)) is 
amended--
            (1) by striking ``or'' at the end of paragraph (1);
            (2) by striking the period at the end of paragraph (2) and 
        inserting ``; or''; and
            (3) by adding at the end the following:
            ``(3) to fund payment of an amount pursuant to clause (i) 
        or (ii) of section 457(a)(2)(B), but only to the extent that 
        the State properly elects under section 457(a)(6) to use the 
        grant to fund the payment.''.
    (f) Effective Date.--
            (1) In general.--The amendments made by this section shall 
        take effect on October 1, 2006, and shall apply to payments 
        under parts A and D of title IV of the Social Security Act for 
        calendar quarters beginning on or after such date, and without 
        regard to whether regulations to implement such amendments (in 
        the case of State programs operated under such part D) are 
        promulgated by such date.
            (2) State option to accelerate effective date.--A State may 
        elect to have the amendments made by this section apply to the 
        State and to amounts collected by the State, on and after such 
        date as the State may select that is after the date of 
        enactment of this Act and before October 1, 2006.

SEC. 502. MANDATORY REVIEW AND ADJUSTMENT OF CHILD SUPPORT ORDERS FOR 
              FAMILIES RECEIVING TANF.

    (a) In General.--Section 466(a)(10)(A)(i) (42 U.S.C. 
666(a)(10)(A)(i)) is amended--
            (1) by striking ``parent, or,'' and inserting ``parent 
        or''; and
            (2) by striking ``upon the request of the State agency 
        under the State plan or of either parent,''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on October 1, 2004.

SEC. 503. DECREASE IN AMOUNT OF CHILD SUPPORT ARREARAGE TRIGGERING 
              PASSPORT DENIAL.

    Section 452(k)(1) (42 U.S.C. 652(k)(1)) is amended by striking 
``$5,000'' and inserting ``$2,500''.

SEC. 504. USE OF TAX REFUND INTERCEPT PROGRAM TO COLLECT PAST-DUE CHILD 
              SUPPORT ON BEHALF OF CHILDREN WHO ARE NOT MINORS.

    Section 464 (42 U.S.C. 664) is amended--
            (1) in subsection (a)(2)(A), by striking ``(as that term is 
        defined for purposes of this paragraph under subsection (c))''; 
        and
            (2) in subsection (c)--
                    (A) in paragraph (1)--
                            (i) by striking ``(1) Except as provided in 
                        paragraph (2), as used in'' and inserting 
                        ``In''; and
                            (ii) by inserting ``(whether or not a 
                        minor)'' after ``a child'' each place it 
                        appears; and
                    (B) by striking paragraphs (2) and (3).

SEC. 505. FINANCING REVIEW AND ADMINISTRATIVE FUNDING.

    Section 455 (42 U.S.C. 655) is amended by adding at the end the 
following:
    ``(g)(1) In addition to any other payments made to a State under 
this part, the Secretary shall pay each State an amount determined in 
accordance with paragraph (2) for fiscal year 2003 to carry out any of 
the following activities:
            ``(A) To review State policies on collecting fees under the 
        State program operated under the State plan approved under this 
        part.
            ``(B) To review the distribution options provided under 
        section 457(a) (as amended by section 501(b)(1)(A) of the Work, 
        Opportunity, and Responsibility for Kids Act of 2002), and, if 
        a State elects such options, to prepare for the implementation 
        of the options.
            ``(C) To update automated systems to conform with 
        requirements of the State program operated under the State plan 
        approved under this part, including as amended by the Work, 
        Opportunity, and Responsibility for Kids Act of 2002.
            ``(D) To improve customer service under such State program.
            ``(E) To examine the causes of, and propose solutions for, 
        undistributed collections under such State program.
            ``(F) To examine the buildup of arrears and approaches to 
        arrears management under such State program.
            ``(G) To develop approaches to improving interstate 
        collections of child support obligations.
            ``(H) To develop approaches to improving the percentage of 
        cases under such State program with an established order for 
        child support.
            ``(I) To review the review and adjustment policies under 
        such program and the State program funded under part A for 
        families receiving assistance or services under the State 
        program funded under part A.
    ``(2)(A) Subject to subparagraph (B), the Secretary shall determine 
the amount of each payment to a State under this subsection for fiscal 
year 2003 based on the proportion of cases under the State program 
operated under the State plan approved under this part for the most 
recent fiscal year for which data is available, as compared to all such 
cases in all States for that fiscal year.
    ``(B) No State shall receive a payment under this subsection for 
fiscal year 2003 that is less than $750,000.
    ``(3) Out of any money in the Treasury of the United States not 
otherwise appropriated, there is appropriated for fiscal year 2003, 
$50,000,000 for making payments to States under this subsection.''.

SEC. 506. ADOPTION OF UNIFORM STATE LAWS.

    (a) In General.--Section 466(f) (42 U.S.C. 666(f)) is amended--
            (1) by striking ``January 1, 1998'' and inserting ``October 
        1, 2004''; and
            (2) by striking ``August 22, 1996'' and inserting ``January 
        1, 2002''.
    (b) Full Faith and Credit for Child Support Orders.--Section 1738B 
of title 28, United States Code, is amended--
            (1) by striking subsection (d) and inserting the following:
    ``(d) Continuing Exclusive Jurisdiction.--
            ``(1) In general.--Subject to paragraph (2), a court of a 
        State that has made a child support order consistently with 
        this section has continuing, exclusive jurisdiction to modify 
        its order if the order is the controlling order and--
                    ``(A) the State is the child's State or the 
                residence of any individual contestant; or
                    ``(B) if the State is not the residence of the 
                child or an individual contestant, the contestants 
                consent in a record or in open court that the court may 
                continue to exercise jurisdiction to modify its order.
            ``(2) Requirement.--A court may not exercise its 
        continuing, exclusive jurisdiction to modify the order if the 
        court of another State, acting in accordance with subsections 
        (e) and (f), has made a modification of the order.'';
            (2) in subsection (e)(2)--
                    (A) in subparagraph (A), by striking ``because'' 
                and all that follows through the semicolon and 
                inserting ``pursuant to paragraph (1) or (2) of 
                subsection (d);'' and
                    (B) in subparagraph (B), by inserting ``with 
                jurisdiction over at least 1 of the individual 
                contestants or that is located in the child's State'' 
                after ``another State'';
            (3) in subsection (f)--
                    (A) in the subsection heading, by striking 
                ``Recognition of'' and inserting ``Determination of 
                Controlling'';
                    (B) in the matter preceding paragraph (1), by 
                striking ``shall apply'' and all that follows through 
                the colon and inserting ``having personal jurisdiction 
                over both individual contestants shall apply the 
                following rules and by order shall determine which 
                order controls:''
                    (C) in paragraph (1), by striking ``must be'' and 
                inserting ``controls and must be so'';
                    (D) in paragraph (2), by striking ``must be 
                recognized'' and inserting ``controls'';
                    (E) in paragraph (3), by striking ``must be 
                recognized'' each place it appears and inserting 
                ``controls'';
                    (F) in paragraph (4)--
                            (i) by striking ``may'' and inserting 
                        ``shall''; and
                            (ii) by striking ``must be recognized'' and 
                        inserting ``controls''; and
                    (G) by striking paragraph (5);
            (4) by striking subsection (g) and inserting the following:
    ``(g) Enforcement of Modified Orders.--If a child support order 
issued by a court of a State is modified by a court of another State 
which properly assumed jurisdiction, the issuing court--
            ``(1) may enforce its order that was modified only as to 
        arrears and interest accruing before the modification;
            ``(2) may provide appropriate relief for violations of its 
        order which occurred before the effective date of the 
        modification; and
            ``(3) shall recognize the modifying order of the other 
        State for the purpose of enforcement.'';
            (5) in subsection (h)--
                    (A) in paragraph (1), by striking ``and (3)'' and 
                inserting ``, (3), and (4)'';
                    (B) in paragraph (2), by inserting ``the 
                computation and payment of arrearages, and the accrual 
                of interest on the arrearages,'' after ``obligations of 
                support,''; and
                    (C) by adding at the end the following:
            ``(4) Prospective application.--After a court determines 
        which is the controlling order and issues an order 
        consolidating arrears, if any, a court shall prospectively 
        apply the law of the State issuing the controlling order, 
        including that State's law with respect to interest on arrears, 
        current and future support, and consolidated arrears.''; and
            (6) in subsection (i), by inserting ``and subsection (d)(2) 
        does not apply'' after ``issuing State''.

SEC. 507. TRIBAL CHILD SUPPORT ENFORCEMENT PROGRAMS.

    Not later than 1 year after the date of enactment of this Act, the 
Secretary of Health and Human Services shall promulgate final 
regulations for making direct payments to Indian tribes and tribal 
organizations under section 455(f) of the Social Security Act (42 
U.S.C. 655(f)).

SEC. 508. REPORT ON UNDISTRIBUTED CHILD SUPPORT PAYMENTS.

    Not later than 6 months after the date of enactment of this Act, 
the Secretary of Health and Human Services shall submit to the 
Committee on Ways and Means of the House of Representatives and the 
Committee on Finance of the Senate a report on the procedures that the 
States use generally to locate custodial parents for whom child support 
has been collected but not yet distributed. The report shall include an 
estimate of the total amount of such undistributed child support and 
the average length of time it takes for such child support to be 
distributed. To the extent the Secretary deems appropriate, the 
Secretary shall include in the report recommendations as to whether 
additional procedures should be established at the Federal or State 
level to expedite the payment of undistributed child support.

SEC. 509. USE OF NEW HIRE INFORMATION TO ASSIST IN ADMINISTRATION OF 
              UNEMPLOYMENT COMPENSATION PROGRAMS.

    (a) In General.--Section 453(j) (42 U.S.C. 653(j)) is amended by 
adding at the end the following:
            ``(7) Information comparisons and disclosure to assist in 
        administration of unemployment compensation programs.--
                    ``(A) In general.--If a State agency responsible 
                for the administration of an unemployment compensation 
                program under Federal or State law transmits to the 
                Secretary the name and social security account number 
                of an individual, the Secretary shall, if the 
                information in the National Directory of New Hires 
                indicates that the individual may be employed, disclose 
                to the State agency the name, address, and employer 
                identification number of any putative employer of the 
                individual, subject to this paragraph.
                    ``(B) Condition on disclosure.--The Secretary shall 
                make a disclosure under subparagraph (A) only to the 
                extent that the Secretary determines that the 
                disclosure would not interfere with the effective 
                operation of the program under this part.
                    ``(C) Use of information.--A State agency may use 
                information provided under this paragraph only for 
                purposes of administering a program referred to in 
                subparagraph (A).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect on October 1, 2002.

SEC. 510. ANNUAL REPORT ON PERFORMANCE OF STATE CHILD SUPPORT PROGRAMS.

    Beginning on January 1, 2003, and annually thereafter, the 
Secretary of Health and Human Services shall submit to the Committee on 
Ways and Means of the House of Representatives and the Committee on 
Finance of the Senate a report regarding the performance of State child 
support programs funded under part D of title IV of the Social Security 
Act (42 U.S.C. 651 et seq.).

SEC. 511. EXTENSION OF AUTHORITY TO APPROVE DEMONSTRATION PROJECTS.

    Section 1130(a)(2) (42 U.S.C. 1320a-9(a)(2)) is amended by striking 
``2002'' and inserting ``2007''.

SEC. 512. PROHIBITION OF LIMIT ON NUMBER OF WAIVERS OR DEMONSTRATION 
              PROJECTS THAT MAY BE GRANTED TO A SINGLE STATE.

    Section 1130 (42 U.S.C. 1320a-9) is amended by adding at the end 
the following:
    ``(h) No Limit on Number of Waivers Granted to, or Demonstration 
Projects That May Be Conducted by, a Single State.--The Secretary shall 
not impose any limit on the number of waivers that may be granted to a 
State, or the number of demonstration projects that a State may be 
authorized to conduct, under this section.''.

                        TITLE VI--TRIBAL ISSUES

SEC. 601. TRIBAL TANF PROGRAMS.

    (a) Findings.--Congress makes the following findings:
            (1) The Federal Government bears a unique trust 
        responsibility for Indian tribes.
            (2) Despite this responsibility, Indians remain remarkably 
        impoverished. According to the Bureau of the Census, 25.9 
        percent of American Indians live in poverty, more than twice 
        the national poverty rate. The average household income for 
        Indians in 2000 was only 75 percent of that of the rest of 
        Americans.
            (3) In some States with substantial Indian populations, the 
        percentage of the welfare caseload that is made up of Indians 
        has increased since the enactment of the Personal 
        Responsibility and Work Opportunity Reconciliation Act of 1996 
        because some Indians face substantial barriers in their moving 
        from welfare to work.
            (4) A General Accounting Office review of data from the 
        Bureau of the Census found that 25 of the 26 counties in the 
        United States with a majority of American Indians had poverty 
        rates ``significantly'' higher than average.
            (5) Many Indian tribes are located in isolated rural areas 
        that lack sufficient economic opportunities, including jobs and 
        economic development, transportation services, child care, and 
        other services necessary to ensure a successful transition from 
        welfare to work.
            (6) Tribal temporary assistance to needy families programs 
        have demonstrated remarkable success in moving Indians from 
        welfare to work.
            (7) Tribal governments, unlike State governments, have not 
        been afforded an opportunity to administer and fully 
        participate in the Federal entitlement program for foster care 
        and adoption assistance, a program Congress recognizes as an 
        important component of welfare services.
            (8) Welfare reform has not brought enough change to Indian 
        Country. Welfare reform has not, and will not, succeed unless 
        it adequately addresses the unique barriers many Indians face 
        in moving from welfare to work.
    (b) Funding for Tribal TANF Programs.--
            (1) Reauthorization of tribal family assistance grants.--
        Section 412(a)(1)(A) (42 U.S.C. 612(a)(1)(A)) is amended by 
        striking ``1997'' and all that follows through ``2002'' and 
        inserting ``2003 through 2007''.
            (2) Tribal tanf improvement fund.--Section 412(a) (42 
        U.S.C. 612(a)) is amended by striking paragraph (2) and 
        inserting the following:
            ``(2) Tribal tanf improvement grants.--
                    ``(A) Tribal capacity grants.--
                            ``(i) In general.--Of the amount 
                        appropriated under subparagraph (D) for the 
                        period of fiscal years 2003 through 2006, 
                        $35,000,000 shall be used by the Secretary to 
                        award grants for tribal human services program 
                        infrastructure improvement (as defined in 
                        clause (v)) to--
                                    ``(I) Indian tribes that have 
                                applied for approval of a tribal family 
                                assistance plan and that meet the 
                                requirements of clause (ii)(I);
                                    ``(II) Indian tribes with an 
                                approved tribal family assistance plan 
                                and that meet the requirements of 
                                clause (ii)(II); and
                                    ``(III) Indian tribes that have 
                                applied for approval of a foster care 
                                and adoption assistance program under 
                                section 479B or that plan to enter 
                                into, or have in place, a tribal-State 
                                cooperative agreement under section 
                                479B(c) and that meet the requirements 
                                of clause (ii)(III).
                            ``(ii) Priorities for awarding of grants.--
                        The Secretary shall give priority in awarding 
                        grants under this subparagraph as follows:
                                    ``(I) First, for grants to Indian 
                                tribes that have applied for approval 
                                of a tribal family assistance plan, 
                                that have not operated such a plan as 
                                of the date of enactment of the Work, 
                                Opportunity, and Responsibility for 
                                Kids Act of 2002 that will have such 
                                plan approved, and that include in the 
                                plan submission provisions for tribal 
                                human services program infrastructure 
                                improvement (as so defined) and related 
                                management information systems 
                                training.
                                    ``(II) Second, for Indian tribes 
                                with an approved tribal family 
                                assistance plan that are not described 
                                in subclause (I) and that submit an 
                                addendum to such plan that includes 
                                provisions for tribal human services 
                                program infrastructure improvement that 
                                includes implementing or improving 
                                management information systems of the 
                                tribe (including management information 
                                systems training), as such systems 
                                relate to the operation of the tribal 
                                family assistance plan.
                                    ``(III) Third, for Indian tribes 
                                that have applied for approval of a 
                                foster care and adoption assistance 
                                program under section 479B or that plan 
                                to enter into, or have in place, a 
                                tribal-State cooperative agreement 
                                under section 479B(c) and that include 
                                in the plan submission under section 
                                471 (or in an addendum to such plan) 
                                provisions for tribal human services 
                                program infrastructure improvement (as 
                                so defined) and related management 
                                information systems training.
                            ``(iii) Other requirements for awarding 
                        grants.--In awarding grants under this 
                        subparagraph, the Secretary--
                                    ``(I) may not award an Indian tribe 
                                more than 1 grant under this 
                                subparagraph per fiscal year;
                                    ``(II) shall award grants in such a 
                                manner as to maximize the number of 
                                Indian tribes that receive grants under 
                                this subparagraph; and
                                    ``(III) shall consult with Indian 
                                tribes located throughout the United 
                                States.
                            ``(iv) Application.--An Indian tribe 
                        desiring a grant under this subparagraph shall 
                        submit an application to the Secretary, at such 
                        time, in such manner, and containing such 
                        information as the Secretary may require.
                            ``(v) Definition of human services program 
                        infrastructure improvement.--In this 
                        subparagraph, the term `human services program 
                        infrastructure improvement' includes (but is 
                        not limited to) improvement of management 
                        information systems, management information 
                        systems-related training, equipping offices, 
                        and renovating, but not constructing, 
                        buildings, as described in an application for a 
                        grant under this subparagraph, and subject to 
                        approval by the Secretary.
                    ``(B) Tribal development grants.--
                            ``(i) In general.--Of the amount 
                        appropriated under subparagraph (D) for the 
                        period of fiscal years 2003 through 2006, 
                        $35,000,000 shall be used by the Secretary to 
                        award, through the Commissioner of the 
                        Administration for Native Americans, grants to 
                        nonprofit organizations, Indian tribes, and 
                        tribal organizations to enable such 
                        organizations and tribes to provide technical 
                        assistance to Indian tribes and tribal 
                        organizations in any or all of the following 
                        areas:
                                    ``(I) The development and 
                                improvement of uniform commercial 
                                codes.
                                    ``(II) The creation or expansion of 
                                small business or microenterprise 
                                programs.
                                    ``(III) The development and 
                                improvement of tort liability codes.
                                    ``(IV) The creation or expansion of 
                                tribal marketing efforts.
                                    ``(V) The creation or expansion of 
                                for-profit collaborative business 
                                networks.
                                    ``(VI) The development of 
                                innovative uses of telecommunications 
                                to assist with distance learning or 
                                telecommuting.
                                    ``(VII) The development of economic 
                                opportunities and job creation in areas 
                                of high joblessness in Alaska (as 
                                defined in section 408(a)(7)(D)(ii)).
                            ``(ii) Requirements.--
                                    ``(I) In general.--At least an 
                                amount equal to 10 percent of the total 
                                amount of grants awarded under this 
                                subparagraph shall be awarded to carry 
                                out clause (i)(VII).
                                    ``(II) Consultation.--In awarding 
                                grants under this subparagraph the 
                                Secretary shall consult with other 
                                Federal agencies with expertise in the 
                                areas described in clause (i).
                            ``(iii) Application.--A nonprofit 
                        organization, Indian tribe, or tribal 
                        organization desiring a grant under this 
                        subparagraph shall submit an application to the 
                        Secretary at such time, in such manner, and 
                        containing such information as the Secretary 
                        may require.
                    ``(C) Technical assistance.--
                            ``(i) In general.--Of the amount 
                        appropriated under subparagraph (D) for the 
                        period of fiscal years 2003 through 2006, 
                        $5,000,000 shall be used by the Secretary for 
                        making grants, or entering into contracts, to 
                        provide technical assistance to Indian tribes--
                                    ``(I) in applying for or carrying 
                                out a grant made under this paragraph;
                                    ``(II) in applying for or carrying 
                                out a tribal family assistance plan 
                                under this section; or
                                    ``(III) related to best practices 
                                and approaches for State and tribal 
                                coordination on the transfer of the 
                                administration of social services 
                                programs to Indian tribes.
                            ``(ii) Reservation of funds.--Not less 
                        than--
                                    ``(I) $2,500,000 of the amount 
                                described in clause (i) shall be used 
                                by the Secretary to support, through 
                                grants or contracts, peer-learning 
                                programs among tribal administrators; 
                                and
                                    ``(II) $1,000,000 of such amount 
                                shall be used by the Secretary for 
                                making grants to Indian tribes to 
                                conduct feasibility studies of the 
                                capacity of Indian tribes to operate 
                                tribal family assistance plans under 
                                this part.
                    ``(D) Appropriation.--Out of any money in the 
                Treasury of the United States not otherwise 
                appropriated, there is appropriated $75,000,000 for the 
                period of fiscal years 2003 through 2006 to carry out 
                this paragraph. Amounts appropriated under this 
                subparagraph shall remain available until expended.''.
            (3) Conforming amendment.--Section 405(a) (42 U.S.C. 
        605(a)) is amended by striking ``section 403'' and inserting 
        ``sections 403 and 412(a)(2)(C)''.
    (c) Eligibility for Contingency Fund.--
            (1) In general.--Section 403(b)(1) (42 U.S.C. 603(b)(3)), 
        as amended by section 102(a)(1), is amended--
                    (A) in subparagraph (A), by striking ``subparagraph 
                (C)'' and inserting ``subparagraphs (C) and (D)'';
                    (B) by redesignating subparagraphs (D) and (E) as 
                subparagraphs (E) and (F), respectively; and
                    (C) by inserting after subparagraph (C), the 
                following:
                    ``(D) Payments to indian tribes.--
                            ``(i) In general.--Of the total amount 
                        appropriated pursuant to subparagraph (F), 
                        $25,000,000 of such amount shall be reserved 
                        for making payments to Indian tribes with 
                        approved tribal family assistance plans that 
                        are operating in situations of increased 
                        economic hardship.
                            ``(ii) Determination of criteria for tribal 
                        access.--
                                    ``(I) In general.--Subject to 
                                subclause (II), the Secretary, in 
                                consultation with Indian tribes with 
                                approved tribal family assistance 
                                plans, shall determine the criteria for 
                                access by Indian tribes to the amount 
                                reserved under clause (i).
                                    ``(II) Inclusion of certain 
                                factors.--Such criteria shall include 
                                factors related to increases in 
                                unemployment and loss of employers.
                            ``(iii) Application of requirements for 
                        payments to states.--The Secretary, in 
                        consultation with Indian tribes with approved 
                        tribal family assistance plans located 
                        throughout the United States, shall determine 
                        the extent to which requirements of States for 
                        payments from the contingency fund established 
                        under this subsection shall apply to Indian 
                        tribes receiving payments under this 
                        subparagraph.''.
            (2) Conforming amendments.--Section 403(b)(1)(B) (42 U.S.C. 
        603(b)(1)(B)), as so amended, is further amended--
                    (A) in the matter preceding clause (i), by striking 
                ``subparagraph (D)(i)'' and inserting ``subparagraph 
                (E)(i)'';
                    (B) in clause (i), by striking ``subparagraph 
                (D)(ii)'' and inserting ``subparagraph (E)(ii)''; and
                    (C) in clause (ii), by striking ``subparagraph 
                (D)(iii)'' and inserting ``subparagraph (E)(iii)''.
    (d) Tribal Job Training Programs.--
            (1) Tribal employment services programs.--
                    (A) In general.--Section 412(a) (42 U.S.C. 612(a)), 
                as amended by subsection (b)(2), is amended by adding 
                at the end the following:
            ``(4) Grants for tribal employment services programs.--
                    ``(A) Purpose.--The purpose of this paragraph is to 
                support comprehensive services to enable eligible 
                beneficiaries to support themselves through employment 
                without requiring cash benefits from public assistance 
                programs for themselves or their families.
                    ``(B) Statement of policy.--The programs funded 
                under grants made under this paragraph shall be 
                administered in a manner consistent with the principles 
                of the Indian Self-Determination and Education 
                Assistance Act (25 U.S.C. 450 et seq.) and the 
                government-to-government relationship between the 
                Federal Government and Indian tribal governments.
                    ``(C) Definitions.--In this paragraph:
                            ``(i) Alaska native organization.--The term 
                        `Alaska Native organization' has the meaning 
                        given the term `Indian tribe' with respect to 
                        the State of Alaska in section 419(4)(B).
                            ``(ii) Department.--Unless otherwise 
                        specified, the term `Department' means the 
                        Department of Labor.
                            ``(iii) Eligible beneficiary.-- The term 
                        `eligible beneficiary' means--
                                    ``(I) an individual who is an 
                                Indian or Alaska Native receiving or 
                                eligible to receive cash benefits for 
                                the individual or the individual's 
                                family under the State program funded 
                                under this part, a tribal family 
                                assistance program under this section, 
                                or the General Assistance program;
                                    ``(II) an individual who is an 
                                Indian or Alaska Native transitioning 
                                from receipt of cash benefits under any 
                                such programs to employment;
                                    ``(III) an individual who is an 
                                Indian or Alaska Native with a history 
                                of long-term dependence (as defined in 
                                clause (v)) on cash benefits under any 
                                such programs or under the aid for 
                                families with dependent children 
                                program under this part (as in effect 
                                before August 22, 1996);
                                    ``(IV) an individual who is an 
                                Indian or Alaska Native who is a non-
                                custodial parent of a minor child 
                                receiving, eligible to receive, or with 
                                a history of receiving cash benefits 
                                under any such programs, or an 
                                individual who has an obligation to 
                                provide support for such children; or
                                    ``(V) an individual who is an 
                                Indian or Alaska Native and is a member 
                                of a family who is at risk of becoming 
                                dependent on cash benefits under any 
                                such programs or who has exhausted 
                                eligibility for such benefits because 
                                of the application of time limits on 
                                benefits.
                            ``(iv) General assistance.--The term 
                        `General Assistance' means the General 
                        Assistance program supported through the Bureau 
                        of Indian Affairs in the Department of the 
                        Interior.
                            ``(v) Long-term dependence.--The term 
                        `long-term dependence' means receipt of cash 
                        benefits under a program referred to in clause 
                        (iii)(III) for at least 24 months, which need 
                        not be consecutive.
                            ``(vi) Secretary.--Unless otherwise 
                        specified, the term `Secretary' means the 
                        Secretary of Labor.
                    ``(D) Authority to make grants.--
                            ``(i) Direct services.--The Secretary shall 
                        make grants to Indian tribes, tribal 
                        organizations, and Alaska Native organizations 
                        on the basis of a formula determined in 
                        accordance with subparagraph (H)(ii) to carry 
                        out the activities described in subparagraph 
                        (E).
                            ``(ii) Program support.--The Secretary 
                        shall, through grants or contracts with 
                        entities, or interagency agreements, carry out 
                        the activities described in subparagraph (F).
                            ``(iii) Appropriation.--
                                    ``(I) In general.--Out of any money 
                                in the Treasury of the United States 
                                not otherwise appropriated, there is 
                                appropriated $37,000,000 for each of 
                                fiscal years 2003 through 2007 to carry 
                                out this paragraph.
                                    ``(II) Reservation of funds for 
                                program support.--The Secretary may 
                                reserve an amount equal to not more 
                                than 1.5 percent of the amount 
                                appropriated under subclause (I) for a 
                                fiscal year to make grants or enter 
                                into contracts under clause (ii).
                    ``(E) Direct service activities.--
                            ``(i) In general.--A recipient of a grant 
                        made under subparagraph (D)(i) shall use the 
                        funds provided under the grant to support any 
                        services which may be useful in preparing 
                        eligible beneficiaries to enter or reenter the 
                        workforce, to retain employment or to advance 
                        to positions which may enable the eligible 
                        beneficiary and the beneficiary's family to 
                        become economically self-sufficient.
                            ``(ii) Services permitted.--Services 
                        provided with funds made available under a 
                        grant made under subparagraph (D)(i) may 
                        include--
                                    ``(I) assessment;
                                    ``(II) education;
                                    ``(III) job readiness and 
                                placement;
                                    ``(IV) occupational training 
                                (including on-the-job training);
                                    ``(V) work experience;
                                    ``(VI) wage subsidies;
                                    ``(VII) job retention;
                                    ``(VIII) job creation specifically 
                                for eligible beneficiaries;
                                    ``(IX) case management;
                                    ``(X) counseling;
                                    ``(XI) supportive services, 
                                including (but not limited to) child 
                                care, transportation, mental health and 
                                substance abuse treatment, and 
                                prevention services important to 
                                employability; and
                                    ``(XII) counseling and other 
                                services to promote marriage, 
                                discourage teen pregnancies, assist in 
                                the formation and stabilization of 2-
                                parent families, and address situations 
                                involving domestic violence.
                            ``(iii) Retention of eligibility for other 
                        services.--An eligible beneficiary who receives 
                        services through funds provided under a grant 
                        made under subparagraph (D)(i) shall not be 
                        precluded from receiving other services from 
                        any State, local, or tribal government agency, 
                        or any other entity.
                            ``(iv) Disregard.--Income or services 
                        received by an eligible beneficiary under this 
                        paragraph shall be disregarded for purposes of 
                        determining eligibility for benefits under any 
                        means-tested program for which the eligibility 
                        requirements are established under Federal law.
                    ``(F) Program support activities.--
                            ``(i) In general.--In order to improve the 
                        effectiveness of services provided by Indian 
                        tribes, tribal organizations, and Alaska Native 
                        organizations under grants made under this 
                        paragraph, the Secretary shall support, through 
                        grants, contracts, or interagency agreements, 
                        activities that--
                                    ``(I) enhance the capacity of 
                                Indian tribes, tribal organizations, 
                                and Alaska Native organizations under 
                                this section to deliver the services 
                                authorized under subparagraph (E); and
                                    ``(II) test or demonstrate new or 
                                improved methods of providing such 
                                services.
                            ``(ii) Preference.--In awarding grants or 
                        contracts under subparagraph (D)(ii) to carry 
                        out this subparagraph, the Secretary shall 
                        implement a preference policy consistent with 
                        the terms of section 7(b) of the Indian Self-
                        Determination and Education Assistance Act (25 
                        U.S.C. 450e(b)).
                    ``(G) Additional requirements.--
                            ``(i) Direct service activities.--
                                    ``(I) Authority to consolidate 
                                funds.--An Indian tribe, tribal 
                                organization, or Alaska Native 
                                organization receiving a grant under 
                                subparagraph (D)(i) may consolidate 
                                funds received under the grant with 
                                assistance received from other programs 
                                in accordance with the provisions of 
                                the Indian Employment, Training and 
                                Related Services Demonstration Act of 
                                1992 (25 U.S.C. 3401 et seq.) or the 
                                provisions of the Tribal Self-
                                Governance Act of 1994 (25 U.S.C. 458aa 
                                et seq.).
                                    ``(II) Option to exclude 
                                participants from determination of work 
                                participation rates.--A State, Indian 
                                tribe, or tribal organization may 
                                exclude individuals participating in a 
                                direct services program funded under a 
                                grant made under subparagraph (D)(i) 
                                for a month from the calculation of the 
                                work participation rate for the State 
                                or tribe for such month.
                            ``(ii) Applicable rules.--Any amount paid 
                        to an Indian tribe, tribal organization, or 
                        Alaska Native organization under this part that 
                        is used to carry out the activities described 
                        in subparagraph (E) or (F) shall not be subject 
                        to the requirements of this part, but shall be 
                        subject to the requirements specified in the 
                        regulations required under subparagraph 
                        (H)(iii), and the expenditure of any amount so 
                        used shall not be considered to be an 
                        expenditure under this part.
                            ``(iii) Availability of funds.--Funds 
                        provided to a recipient of a grant or contract 
                        under subparagraph (D)(ii) shall remain 
                        available for obligation for 2 succeeding 
                        fiscal years after the fiscal year in which the 
                        grant is made or the contract is entered into.
                    ``(H) Program administration.--
                            ``(i) Designation of office with primary 
                        responsibility.--The Secretary shall designate 
                        a single organizational unit within the 
                        Department that shall have as its primary 
                        responsibility the administration of the 
                        activities authorized under this paragraph and 
                        of any related Indian programs administered by 
                        the Department.
                            ``(ii) Consultation.--
                                    ``(I) In general.--The Secretary 
                                shall consult with Indian tribes and 
                                tribal organizations eligible to 
                                administer activities authorized under 
                                this paragraph that are located 
                                throughout the United States on all 
                                aspects of the operation and 
                                administration of such activities, 
                                including the promulgation of 
                                regulations, the design of a formula 
                                for the allocation of funds among 
                                Indian tribes and tribal organizations, 
                                and the implementation of program 
                                support activities described in 
                                subparagraph (F).
                                    ``(II) Advisory committee.--The 
                                Secretary may utilize a broadly based 
                                advisory committee whose members are 
                                nominated by Indian tribes and tribal 
                                organizations eligible to administer 
                                activities authorized under this 
                                paragraph as part of the consultation 
                                required under subclause (I), except 
                                that the consultation process shall not 
                                be limited to discussions with such 
                                committee.
                            ``(iii) Regulations.--The Secretary may 
                        issue regulations for the conduct of activities 
                        under this paragraph. All requirements imposed 
                        by such regulations, including reporting 
                        requirements, shall take into full 
                        consideration tribal circumstances and 
                        conditions.''.
                    (B) Transition from other tanf indian employment 
                programs.--
                            (i) In general.--Subject to clause (ii), 
                        the Secretary of Health and Human Services 
                        shall provide for an orderly close-out of 
                        activities under the work program authorized in 
                        section 412(a)(2) of the Social Security Act 
                        (42 U.S.C. 612(a)(2)) (commonly referred to as 
                        the ``Native Employment Works program'' or the 
                        ``NEW'' program) as such section is in effect 
                        on September 30, 2002.
                            (ii) Requirement.--In closing out the 
                        activities referred to in clause (i), the 
                        Secretary of Health and Human Services shall 
                        provide that grantees under a program referred 
                        to in that subparagraph shall be permitted to 
                        provide services through June 30, 2003, and 
                        shall be permitted to spend funds on 
                        administrative activities related to the close-
                        out of grants under programs for up to 6 months 
                        after that date.
            (2) Application of indian employment, training, and related 
        services demonstration act of 1992.--Section 412(a) (42 U.S.C. 
        612(a)), as amended by paragraph (1)(A), is amended by adding 
        at the end the following:
            ``(5) Application of indian employment, training, and 
        related services demonstration act of 1992.--Notwithstanding 
        any other provision of law, if an Indian tribe elects to 
        incorporate the services it provides under this part into a 
        plan under section 6 of the Indian Employment, Training, and 
        Related Services Demonstration Act of 1992 (25 U.S.C. 3405), 
        the programs authorized to be conducted with grants made under 
        this part shall be--
                    ``(A) considered to be programs subject to section 
                5 of the Indian Employment, Training, and Related 
                Services Demonstration Act of 1992 (25 U.S.C. 3404); 
                and
                    ``(B) subject to the single plan and single budget 
                requirements of section 6 of that Act (25 U.S.C. 3405) 
                and the single report format required under section 11 
                of that Act (25 U.S.C. 3410).''.
    (e) Tribal Family Assistance Plans.--
            (1) Equitable access.--Section 412(b)(1) (42 U.S.C. 
        612(b)(1)) is amended--
                    (A) in subparagraph (E), by striking ``and'' at the 
                end;
                    (B) in subparagraph (F), by striking the period and 
                inserting ``; and''; and
                    (C) by adding at the end the following:
                    ``(G) describes how the Indian tribe will ensure 
                equitable access to benefits and services provided 
                under the plan for each member of the population to be 
                served by the plan.''.
            (2) Consultation between states and indian tribes or other 
        indians residing on a reservation.--
                    (A) State plan requirement.--Section 402(a)(5) (42 
                U.S.C. 602(a)(5)) is amended to read as follows:
            ``(5) Certification that the state will provide indians 
        with equitable access to assistance.--
                    ``(A) In general.--A certification by the chief 
                executive officer of the State that, during the fiscal 
                year, the State will--
                            ``(i) subject to subparagraph (B), consult 
                        with Indian tribes located within the State 
                        regarding the State plan in an effort to ensure 
                        equitable access to benefits or services 
                        provided under the plan for any member of such 
                        a tribe who is not eligible for assistance 
                        under a tribal family assistance plan approved 
                        under section 412; and
                            ``(ii) provide each member of an Indian 
                        tribe, who is domiciled in the State and is not 
                        eligible for assistance under a tribal family 
                        assistance plan approved under section 412, 
                        with equitable access to assistance under the 
                        State program funded under this part 
                        attributable to funds provided by the Federal 
                        Government.
                    ``(B) Exception.--Clause (i) of subparagraph (A) 
                shall not apply to the State of Alaska.''.
                    (B) Tribal family assistance plan requirement.--
                Section 412(b)(1) (42 U.S.C. 612(b)(1)), as amended by 
                paragraph (1), is amended--
                            (i) in subparagraph (F), by striking 
                        ``and'' at the end;
                            (ii) in subparagraph (G), by striking the 
                        period and inserting ``; and''; and
                            (iii) by adding at the end the following:
                    ``(H) provides that the Indian tribe will consult 
                with each State in which a service area of the plan is 
                located on the operation of the plan and the provision 
                of assistance or services to families under the 
                plan.''.
    (f) Areas With High Joblessness.--
            (1) Time limit for receipt of assistance.--Section 
        408(a)(7)(D) (42 U.S.C. 608(a)(7)(D)) is amended--
                    (A) in the subparagraph heading, by striking ``by 
                adult'' and all that follows through ``unemployment'' 
                and inserting ``in areas of indian country or an 
                alaskan native village with high joblessness''; and
                    (B) in clause (i)--
                            (i) by striking ``In'' and inserting 
                        ``Subject to clauses (ii) and (iii), in''; and
                            (ii) by striking ``50 percent'' and all 
                        that follows through the period and inserting 
                        ``20 percent of the adults who were living in 
                        Indian country were jobless.'';
                    (C) by redesignating clause (ii) as clause (iv); 
                and
                    (D) by inserting after clause (i), the following:
                            ``(ii) Alaskan native village.--With 
                        respect to an Alaskan Native village, this 
                        subparagraph shall be applied--
                                    ``(I) in clause (i), by 
                                substituting `50 percent of the adults 
                                living in in the village were not 
                                employed' for `20 percent of the adults 
                                who were living in Indian country were 
                                jobless'; and
                                    ``(II) without regard to clause 
                                (iii).
                            ``(iii) Requirement.--A month may only be 
                        disregarded under clause (i) with respect to an 
                        adult recipient described in that clause if the 
                        adult is in compliance with program 
                        requirements.''.
            (2) Flexibility to define work activities.--Section 
        407(c)(2) (42 U.S.C. 607(c)(2)), as amended by section 202(h), 
        is amended by adding at the end the following:
                    ``(G) Optional modification of work requirements 
                for recipients residing in areas of indian country or 
                an alaskan native village with high joblessness.--
                Notwithstanding paragraph (1), if a State has included 
                in the State plan a description of the State's policies 
                in areas of Indian country or an Alaskan Native village 
                described in section 408(a)(7)(D), the State may define 
                the activities described in subsection (d) that a 
                recipient who resides in such an area and who is 
                participating in activities in accordance with an 
                individual responsibility plan under section 408(b) may 
                engage in for purposes of satisfying work requirements 
                under the State program and for purposes of determining 
                monthly participation rates under subsection (b).''.
    (g) Advisory Committees.--
            (1) Advisory committee on the status of indians who do not 
        reside in indian country.--
                    (A) In general.--The Secretary of Health and Human 
                Services shall convene an advisory committee on the 
                status of Indians who do not reside in Indian country 
                (as defined in section 1151 of title 18, United States 
                Code).
                    (B) Duties.--The committee established under 
                subparagraph (A) shall make recommendations regarding 
                how to ensure that Indians who do not reside in Indian 
                country (as so defined) receive appropriate assistance 
                under the temporary assistance to needy families 
                program under part A of title IV of the Social Security 
                Act (42 U.S.C. 601 et seq.) and other publicly funded 
                assistance programs.
                    (C) Membership.--
                            (i) In general.--The committee established 
                        under subparagraph (A) shall include 
                        representatives of--
                                    (I) Federal, State, and tribal 
                                governments; and
                                    (II) Indians who do not reside in 
                                Indian country (as so defined).
                            (ii) Majority.--A majority of the members 
                        of such committee shall be representatives of 
                        Indians who do not reside in Indian country (as 
                        so defined).
            (2) Advisory committee on faith-based initiatives.--
                    (A) In general.--The Secretary of Health and Human 
                Services, through the Director of the Center for Faith-
                Based and Community Initiatives of the Department of 
                Health and Human Services, shall convene an advisory 
                committee of Indians who are expert in social services 
                and the spiritual aspects of traditional Indian 
                cultures.
                    (B) Report.--Not later than 18 months after the 
                date of enactment of this Act, the advisory committee 
                convened under subparagraph (A) shall issue a report 
                that includes best practices with respect to the 
                delivery of social services in relation to the 
                spiritual aspects of traditional Indian cultures for 
                State and tribal administrators of temporary assistance 
                to needy families programs under part A of title IV of 
                the Social Security Act (42 U.S.C. 601 et seq.).
    (h) GAO Study and Report.--
            (1) Study.--The Comptroller General of the United States 
        shall conduct a study of the demographics of Indians who do 
        not--
                    (A) reside in Indian country (as defined in section 
                1151 of title 18, United States Code);
                    (B) reside in Alaska; or
                    (C) receive assistance under a tribal family 
                assistance plan under section 412 of the Social 
                Security Act (42 U.S.C. 612).
            (2) Requirement.--The study conducted under paragraph (1) 
        shall include economic and health information regarding the 
        Indians described in that paragraph, as well as information 
        regarding the access of all Indians to benefits or services 
        available under non-tribal publicly funded programs serving 
        low-income families.
            (2) Report.--Not later than June 30, 2003, the Comptroller 
        General shall submit to Congress a report on the study 
        conducted under paragraph (1).

SEC. 602. AUTHORITY OF INDIAN TRIBES TO RECEIVE FEDERAL FUNDS FOR 
              FOSTER CARE AND ADOPTION ASSISTANCE.

    (a) Children Placed in Tribal Custody Eligible for Foster Care 
Funding.--Section 472(a)(2) of the Social Security Act (42 U.S.C. 
672(a)(2)) is amended--
            (1) by striking ``or (B)'' and inserting ``(B)''; and
            (2) by inserting before the semicolon the following: ``, or 
        (C) an Indian tribe or tribal organization (as defined in 
        section 479B(e)) or an intertribal consortium if the Indian 
        tribe, tribal organization, or consortium is not operating a 
        program pursuant to section 479B and (i) has a cooperative 
        agreement with a State pursuant to section 479B(c) or (ii) 
        submits to the Secretary a description of the arrangements 
        (jointly developed or developed in consultation with the State) 
        made by the Indian tribe, tribal organization, or consortium 
        for the payment of funds and the provision of the child welfare 
        services and protections required by this title''.
    (b) Programs Operated by Indian Tribal Organizations.--Part E of 
title IV of the Social Security Act (42 U.S.C. 670 et seq.) is amended 
by adding at the end the following:

``SEC. 479B. PROGRAMS OPERATED BY INDIAN TRIBAL ORGANIZATIONS.

    ``(a) Application.--Except as provided in subsection (b), this part 
shall apply to an Indian tribe or tribal organization that elects to 
operate a program under this part in the same manner as this part 
applies to a State.
    ``(b) Modification of Plan Requirements.--
            ``(1) Service area; standards.--
                    ``(A) In general.--Subject to subparagraph (B), in 
                the case of an Indian tribe or tribal organization 
                submitting a plan for approval under section 471, the 
                plan shall--
                            ``(i) in lieu of the requirement of section 
                        471(a)(3), identify the service area or areas 
                        and population to be served by the Indian tribe 
                        or tribal organization; and
                            ``(ii) in lieu of the requirement of 
                        section 471(a)(10), provide for the approval of 
                        foster homes pursuant to tribal standards and 
                        in a manner that ensures the safety of, and 
                        accountability for, children placed in foster 
                        care.
                    ``(B) Special rule.--With respect to an Indian 
                tribe located in the State of Alaska--
                            ``(i) clause (ii) of subparagraph (A) shall 
                        not apply; and
                            ``(ii) the requirement of section 
                        471(a)(10) shall apply to a plan submitted by 
                        such tribe.
            ``(2) Determination of federal share.--
                    ``(A) Per capita income.--
                            ``(i) In general.--For purposes of 
                        determining the Federal medical assistance 
                        percentage applicable to an Indian tribe or 
                        tribal organization under paragraphs (1) and 
                        (2) of section 474(a), the calculation of an 
                        Indian tribe's or tribal organization's per 
                        capita income shall be based upon the service 
                        population of the Indian tribe or tribal 
                        organization as defined in its plan in 
                        accordance with paragraph (1)(A).
                            ``(ii) Consideration of other 
                        information.--An Indian tribe or tribal 
                        organization may submit to the Secretary such 
                        information as the Indian tribe or tribal 
                        organization considers relevant to the 
                        calculation of the per capita income of the 
                        Indian tribe or tribal organization, and the 
                        Secretary shall consider such information 
                        before making the calculation.
                    ``(B) Administrative expenditures.--The Secretary 
                shall, by regulation, determine the proportions to be 
                paid to Indian tribes and tribal organizations pursuant 
                to section 474(a)(3), except that in no case shall an 
                Indian tribe or tribal organization receive a lesser 
                proportion than the corresponding amount specified for 
                a State in that section.
                    ``(C) Sources of non-federal share.--An Indian 
                tribe or tribal organization may use Federal or State 
                funds to match payments for which the Indian tribe or 
                tribal organization is eligible under section 474.
            ``(3) Modification of other requirements.--Upon the request 
        of an Indian tribe, tribal organization, or a consortia of 
        tribes or tribal organizations, the Secretary may modify any 
        requirement under this part if, after consulting with the 
        Indian tribe, tribal organization, or consortia of tribes or 
        tribal organizations, the Secretary determines that 
        modification of the requirement would advance the best 
        interests and the safety of children served by the Indian 
        tribe, tribal organization, or consortia of tribes or tribal 
        organizations.
            ``(4) Consortium.--The participating Indian tribes or 
        tribal organizations of an intertribal consortium may develop 
        and submit a single plan under section 471 that meets the 
        requirements of this section.
    ``(c) Cooperative Agreements.--An Indian tribe, tribal 
organization, or intertribal consortium and a State may enter into a 
cooperative agreement for the administration or payment of funds 
pursuant to this part. In any case where an Indian tribe, tribal 
organization, or intertribal consortium and a State enter into a 
cooperative agreement that incorporates any of the provisions of this 
section, those provisions shall be valid and enforceable. Any such 
cooperative agreement that is in effect as of the date of enactment of 
this section, shall remain in full force and effect subject to the 
right of either party to the agreement to revoke or modify the 
agreement pursuant to the terms of the agreement.
    ``(d) Regulations.--Not later than 1 year after the date of 
enactment of this section, the Secretary shall, in full consultation 
with Indian tribes and tribal organizations, promulgate regulations to 
carry out this section.
    ``(e) Definitions of Indian Tribe; Tribal Organizations.--In this 
section, the terms `Indian tribe' and `tribal organization' have the 
meanings given those terms in subsections (e) and (l) of section 4 of 
the Indian Self-Determination and Education Assistance Act (25 U.S.C. 
450b), respectively, except that, with respect to the State of Alaska, 
the term `Indian tribe' has the meaning given that term in section 
419(4)(B).''.
    (c) Effective Date.--The amendments made by this section take 
effect on October 1, 2003, without regard to whether regulations to 
implement such amendments have been promulgated as of such date.

         TITLE VII--INNOVATION, FLEXIBILITY, AND ACCOUNTABILITY

SEC. 701. DATA COLLECTION; PERFORMANCE MEASURES.

    (a) Data Collection.--
            (1) Contents of report.-- Section 411(a)(1)(A) (42 U.S.C. 
        611(a)(1)(A)) is amended--
                    (A) in clause (viii), by striking ``and educational 
                level''; and
                    (B) by adding at the end the following:
                            ``(xviii) Whether an individual 
                        responsibility plan is established for each 
                        family in accordance with section 408(b).''.
            (2) Report on indians; public availability of state program 
        and financial data submissions.--Section 411(a) (42 U.S.C. 
        611(a)) is amended--
                    (A) by redesignating paragraph (7) as paragraph 
                (9); and
                    (B) by inserting after paragraph (6), the 
                following:
            ``(7) Report on indians served by the state program.--The 
        report required by paragraph (1) for a fiscal quarter shall 
        include information on the demographics and caseload 
        characteristics of Indians served by the State program during 
        the quarter.
            ``(8) Public availability of report.--The State shall make 
        publicly available at the time of submission of each report 
        required under paragraph (1) for a fiscal quarter a copy of the 
        report for that fiscal quarter, including by posting of the 
        copy on the Internet website for the State agency administering 
        the State program funded under this part.''.
            (3) Additional information in annual report to congress.--
        Section 411(b) (42 U.S.C. 611(b)) is amended--
                    (A) in paragraph (3), by striking ``and'' at the 
                end;
                    (B) in paragraph (4), by striking the period and 
                inserting a semicolon; and
                    (C) by adding at the end the following:
            ``(5) information regarding any complaints received by the 
        Federal Government or States concerning fair and equitable 
        treatment related to civil rights or labor laws, including the 
        number and status of such complaints, and in the case of 
        States, that is State specific; and
            ``(6) State specific information on the demographics and 
        caseload characteristics of Indians served by each State 
        program funded under this part.''.
    (b) Performance Measures.--
            (1) Success in moving recipients from welfare to work.--
        Section 413(d) (42 U.S.C. 613(d)) is amended to read as 
        follows:
    ``(d) Annual Performance Measures of Success in Moving Recipients 
From Welfare to Work.--Beginning on January 1, 2003, and annually 
thereafter, the Secretary shall issue the following data regarding the 
performance of each State program funded under this part for the 2 
preceding fiscal years with respect to helping recipients of assistance 
under such State programs in becoming self-sufficient through earnings 
from employment:
            ``(1) Job entry and retention rates for such recipients and 
        former recipients.
            ``(2) Quarterly earnings and earnings gain for such 
        recipients and former recipients.''.
            (2) National goal to reduce teen pregnancy.--Section 413(e) 
        (42 U.S.C. 613(e)) is amended to read as follows:
    ``(e) National Goal To Reduce Teen Pregnancy.--
            ``(1) Establishment of national goal.--There is hereby 
        established a national goal of reducing teen pregnancy by \1/3\ 
        by December 31, 2007.
            ``(2) Annual assessment of progress.--Beginning on January 
        1, 2003, and annually thereafter, the Secretary shall issue an 
        annual assessment of the progress toward achieving the national 
        goal established under paragraph (1), that includes State-level 
        data on teen pregnancies and an assessment of the progress of 
        each State in achieving such goal.''.

SEC. 702. STATE PLAN.

    Section 402 (42 U.S.C. 602) is amended--
            (1) in subsection (a)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``27-month'' and inserting ``24-month'';
                    (B) in paragraph (1)(A)--
                            (i) in the matter preceding clause (i), by 
                        striking ``intends to'' and inserting 
                        ``shall'';
                            (ii) in clause (i), by inserting ``cash'' 
                        before ``assistance'';
                            (iii) by striking clause (ii) and inserting 
                        the following:
                            ``(ii) Require a parent or caretaker 
                        receiving assistance under the program to 
                        engage in work or work readiness activities 
                        designed to move families receiving assistance 
                        into self-sufficiency, consistent with section 
                        407(e)(2). Such activities may be determined by 
                        the State, and shall include, as appropriate, 
                        efforts eliminating barriers to work such as 
                        physical or mental disabilities, substance 
                        abuse, adult illiteracy, domestic violence, and 
                        lack of affordable housing.'';
                            (iv) in clause (iii), by inserting ``and 
                        individual responsibility plans developed 
                        pursuant to section 408(b)'' after ``407'';
                            (v) by striking clauses (v) and (vi);
                            (vi) by redesignating clause (iv) as clause 
                        (viii); and
                            (vii) by inserting after clause (iii), the 
                        following:
                            ``(iv) Establish the process for providing 
                        recipients with individual responsibility plans 
                        consistent with section 408(b), including a 
                        description of the screening and assessment 
                        procedures the State employs.
                            ``(v) Ensure that training and resources 
                        are made available to the State agency 
                        administering the program so that each family 
                        receiving assistance under the program receives 
                        the support for which the families are 
                        eligible, including training related to civil 
                        rights and anti-discrimination laws.
                            ``(vi) Ensure the availability of a stable 
                        and professional workforce in the 
                        administration of the State program funded 
                        under this part.
                            ``(vii) Ensure equitable access to benefits 
                        and services provided under the program for 
                        each member of an Indian tribe or tribal 
                        organization, who is domiciled in the State and 
                        is not eligible for assistance under a tribal 
                        family assistance plan approved under section 
                        412.'';
                    (C) in paragraph (1)(B)--
                            (i) by striking clause (i) and inserting 
                        the following:
                            ``(i) With respect to each program that 
                        will be funded under this part, or with 
                        qualified State expenditures claimed by the 
                        State to meet the requirements of section 
                        409(a)(7), over the 24-month period for which 
                        the plan is being submitted--
                                    ``(I) the name of the program;
                                    ``(II) the goals of the program;
                                    ``(III) a description of the 
                                benefits and services provided in the 
                                program;
                                    ``(IV) a description of principal 
                                eligibility rules (financial and 
                                nonfinancial) and populations served 
                                under the program; and
                                    ``(V) if the program provides 
                                assistance--
                                            ``(aa) a description of 
                                        applicable work-related 
                                        requirements and the State's 
                                        definition of each work 
                                        activity in section 407(d);
                                            ``(bb) a description of 
                                        time limit policies (if 
                                        applicable), including the 
                                        length of time allowed, the 
                                        policies concerning exemptions 
                                        and extensions, and the 
                                        policies concerning aid after 
                                        the time limit; and
                                            ``(cc) a description of 
                                        sanction policies and 
                                        procedures (if applicable), 
                                        including the duration of the 
                                        sanctions, policies concerning 
                                        good cause for failure to 
                                        comply, and procedures to 
                                        assist families with barriers 
                                        in complying with 
                                        requirements.'';
                            (ii) in clause (iii), by inserting ``, and 
                        information regarding any complaints received 
                        by the State concerning fair and equitable 
                        treatment related to civil rights or labor laws 
                        and a description of the procedures used by the 
                        State to respond to such complaints'' before 
                        the period; and
                            (iii) by adding at the end the following:
                            ``(v) In the case of a State that provides 
                        sub-State areas with significant policy-making 
                        authority, the document shall include a summary 
                        of policies for each sub-State area with such 
                        authority.''; and
                    (D) as amended by section 103(b), by adding at the 
                end the following:
            ``(9) Certification of consultation on provision of 
        transportation aid.--In the case of a State that provides 
        transportation aid under the State program, a certification by 
        the chief executive officer of the State that State and local 
        transportation agencies and planning bodies have been consulted 
        in the development of the plan.
            ``(10) Certification of consultation on provision of 
        housing aid.--In the case of a State that provides housing aid 
        under the State program, a certification by the chief executive 
        officer of the State that State housing agencies and 
        authorities have been consulted in the development of the plan 
        and that such consultations have addressed potential 
        cooperation between agencies administering the State program 
        funded under this part and housing agencies and groups in 
        meeting the housing needs of families receiving assistance 
        under the State program funded under this part and assisting 
        such families in achieving self-sufficiency.''; and
            (2) by striking subsection (c) and inserting the following:
    ``(c) Standard Format.--
            ``(1) Standard state plan format.--The Secretary shall, 
        after notice and public comment, develop a proposed Standard 
        State Plan Form to be used by States to submit the plan 
        required under this section. Such form shall be finalized by 
        the Secretary for use by the State not later than February 1, 
        2003.
            ``(2) Requirement for completed plan using standard state 
        plan format by fiscal year 2004.--Notwithstanding any other 
        provision of law, each State shall submit a complete State 
        plan, using the Standard State Plan Form developed under 
        paragraph (1), not later than October 1, 2003.
    ``(d) Housing Data.--
            ``(1) In general.--Effective October 1, 2003 (or as soon 
        thereafter as is practicable), the Secretary and the Secretary 
        of Housing and Urban Development jointly shall make available 
        to each State State-level data from the 2000 decennial census 
        concerning the housing problems of families receiving 
        assistance under the State program funded under this part.
            ``(2) Update.--The Secretary and the the Secretary of 
        Housing and Urban Development biennially shall make available 
        to each State updated data regarding such problems, to the 
        extent such data is available.
    ``(e) Public Availability.--
            ``(1) Notice and comment.--Prior to submitting a State plan 
        or an amendment of such plan based on a change in policy to the 
        Secretary under this section, the State shall--
                    ``(A) make the proposed State plan or amendment 
                available to the public through an appropriate State 
                maintained Internet website and through other means as 
                the State determines appropriate;
                    ``(B) allow for a reasonable public comment period 
                of not less than 45 days; and
                    ``(C) make comments received concerning such plan 
                or amendment or, at the discretion of the State, a 
                summary of the comments received available to the 
                public through such website and through other means as 
                the State determines appropriate.
            ``(2) Public availability of state plan.--A State shall 
        ensure that the State plan, that is in effect for any fiscal 
        year, is available to the public through an appropriate State 
        maintained Internet website and through other means as the 
        State determines appropriate.
    ``(f) No Cause of Action.--Nothing in this section shall be 
construed as establishing a cause of action against a State based 
solely on a State's failure to submit a State plan or an amendment to 
such plan in accordance with the requirements of this section or on a 
State's failure to comply with the contents of the State plan.''.

SEC. 703. RESEARCH.

    (a) Indicators of Child Well-Being.--Section 413 (42 U.S.C. 613), 
as amended by section 303, is amended by adding at the end the 
following:
    ``(l) Indicators of Child Well-Being.--
            ``(1) In general.--The Secretary, through grants, 
        contracts, or interagency agreements shall develop 
        comprehensive indicators to assess child well-being in each 
        State.
            ``(2) Requirements.--
                    ``(A) In general.--The indicators developed under 
                paragraph (1) shall include measures related to the 
                following:
                            ``(i) Education.
                            ``(ii) Social and emotional development.
                            ``(iii) Health and safety.
                            ``(iv) Family well-being, such as family 
                        structure, income, employment, child care 
                        arrangements, and family relationships.
                    ``(B) Other requirements.--The data collected with 
                respect to the indicators developed under paragraph (1) 
                shall be--
                            ``(i) statistically representative at the 
                        State level;
                            ``(ii) consistent across States;
                            ``(iii) collected on an annual basis for at 
                        least the 5 years preceding the year of 
                        collection;
                            ``(iv) expressed in terms of rates or 
                        percentages;
                            ``(v) statistically representative at the 
                        national level;
                            ``(vi) measured with reliability;
                            ``(vii) current; and
                            ``(viii) over-sampled, with respect to low-
                        income children and families.
                    ``(C) Consultation.--In developing the indicators 
                required under paragraph (1) and the means to collect 
                the data required with respect to the indicators, the 
                Secretary shall consult and collaborate with the 
                Federal Interagency Forum on Child and Family 
                Statistics.
            ``(3) Advisory panel.--
                    ``(A) Establishment.--The Secretary shall establish 
                an advisory panel to make recommendations regarding the 
                appropriate measures and statistical tools necessary 
                for making the assessment required under paragraph (1) 
                based on the indicators developed under that paragraph 
                and the data collected with respect to the indicators.
                    ``(B) Membership.--
                            ``(i) In general.--The advisory panel 
                        established under subparagraph (A) shall 
                        consist of the following:
                                    ``(I) One member appointed by the 
                                Secretary of Health and Human Services.
                                    ``(II) One member appointed by the 
                                Chairman of the Committee on Ways and 
                                Means of the House of Representatives.
                                    ``(III) One member appointed by the 
                                Ranking Member of the Committee on Ways 
                                and Means of the House of 
                                Representatives.
                                    ``(IV) One member appointed by the 
                                Chairman of the Committee on Finance of 
                                the Senate.
                                    ``(V) One member appointed by the 
                                Ranking Member of the Committee on 
                                Finance of the Senate.
                                    ``(VI) One member appointed by the 
                                Chairman of the National Governors 
                                Association, or the Chairman's 
                                designee.
                                    ``(VII) One member appointed by the 
                                President of the National Conference of 
                                State Legislatures or the President's 
                                designee.
                                    ``(VIII) One member appointed by 
                                the Director of the National Academy of 
                                Sciences, or the Director's designee.
                            ``(ii) Deadline.--The members of the 
                        advisory panel shall be appointed not later 
                        than 2 months after the date of enactment of 
                        the Work, Opportunity, and Responsibility for 
                        Kids Act of 2002.
                    ``(C) Meetings.--The advisory panel established 
                under subparagraph (A) shall meet--
                            ``(i) at least 3 times during the first 
                        year after the date of enactment of the Work, 
                        Opportunity, and Responsibility for Kids Act of 
                        2002; and
                            ``(ii) annually thereafter for the 3 
                        succeeding years.
            ``(4) Funding.--Of the amount appropriated under section 
        403(a)(1)(F) for each of fiscal years 2003 through 2007, 
        $15,000,000 shall be reserved for the purpose of carrying out 
        this subsection.''.
    (b) Funding of Studies and Research.--Section 413(h) (42 U.S.C. 
613(h)) is amended--
            (1) in paragraph (1)--
                    (A) in the matter preceding subparagraph (A), by 
                striking ``Out of'' and all that follows through 
                ``2002'' and inserting ``Of the amount appropriated 
                under section 403(a)(1)(F) for each of fiscal years 
                2003 through 2007, $20,000,000 shall be reserved''; and
                    (B) by striking subparagraph (D) and inserting the 
                following:
                    ``(D) the cost of conducting the studies described 
                in paragraphs (4) through (6).'';
            (2) in paragraph (2), by striking ``year'' and all that 
        follows and inserting ``year--
                    ``(A) not less than 25 percent shall be allocated 
                to carry out the purpose described in paragraph (1)(A);
                    ``(B) not less than 25 percent shall be allocated 
                to carry out the purpose described in paragraph (1)(B);
                    ``(C) not less than 25 percent shall be allocated 
                to carry out the purpose described in paragraph (1)(C); 
                and
                    ``(D) not less than 25 percent shall be allocated 
                to carry out the purpose described in paragraph 
                (1)(D).''; and
            (3) by adding at the end the following:
            ``(4) Longitudinal studies of applicants and recipients to 
        determine the factors that contribute to positive employment 
        and family outcomes.--
                    ``(A) In general.--The Secretary, directly or 
                through grants, contracts, or interagency agreements, 
                shall conduct longitudinal studies in at least 5 and 
                not more than 10 States (or sub-State areas, provided 
                that none of such areas are located in the same State) 
                of a representative sample of families that receive, 
                and applicants for, assistance in a State program 
                funded under this part or under a program funded with 
                qualified State expenditures (as defined in section 
                409(a)(7)(B)(i)).
                    ``(B) General requirements.--The studies conducted 
                under this paragraph shall follow families that leave 
                assistance, those that receive assistance throughout 
                the study period, and those diverted from assistance 
                programs. The studies shall gather information on--
                            ``(i) family and adult demographics 
                        (including race, ethnicity, household 
                        composition, marital status, primary language, 
                        barriers to employment, educational status of 
                        adults, prior work history, and prior history 
                        of welfare receipt);
                            ``(ii) family income (including earnings, 
                        unemployment compensation, and child support);
                            ``(iii) benefit receipt (including benefits 
                        under the food stamp program, the medicaid 
                        program under title XIX, the State children's 
                        health insurance program under title XXI, child 
                        care assistance, supplemental security income 
                        benefits under title XVI, earned income tax 
                        credits, and housing assistance);
                            ``(iv) reasons for leaving or returning to 
                        assistance programs;
                            ``(v) work participation status and 
                        activities, including the scope and duration of 
                        work activities;
                            ``(vi) sanction status (including reasons 
                        for sanction);
                            ``(vii) time limit status (including months 
                        remaining on Federal and State time limits);
                            ``(viii) recipient views on program 
                        participation; and
                            ``(ix) other measures of family well-being 
                        over the period studied.
                    ``(C) Comparability.--The Secretary shall ensure to 
                the extent possible that the studies conducted under 
                this paragraph produce comparable results and 
                information.
                    ``(D) Geographic diversity.--The studies conducted 
                under this paragraph shall be conducted in States or 
                sub-State areas that have significant areas of low 
                population density and in States or sub-State areas 
                with areas of high population density.
                    ``(E) Reports.--The Secretary shall publish--
                            ``(i) not later than December 31, 2005, 
                        interim findings from at least 12 months of 
                        longitudinal data collected under studies 
                        conducted under this paragraph; and
                            ``(ii) not later than December 31, 2006, 
                        findings from at least 24 months of 
                        longitudinal data collected under studies 
                        conducted under this paragraph.
            ``(5) Study of effects of sanctions.--
                    ``(A) In general.--The Secretary, directly or 
                through grants, contracts, or interagency agreements, 
                shall conduct a random assignment study comparing the 
                effects of full-family sanctions, partial sanctions, 
                and other policies for increasing engagement in work 
                activities required under the State programs funded 
                under this part.
                    ``(B) Required information.--The study conducted 
                under this paragraph shall include information with 
                respect to participants in the study on demographic 
                characteristics, work participation rates, employment 
                and earnings, duration and amount of payments of 
                assistance under the State program funded under this 
                part, factors affecting program compliance, incidences 
                of hardship, family income, and the well-being of 
                children.
                    ``(C) Report.--Not later than December 31, 2006, 
                the Secretary shall submit to Congress the results of 
                the study conducted under this paragraph.
            ``(6) Study of teen parent recipients.--
                    ``(A) In general.--The Secretary, directly or 
                through grants, contracts, or interagency agreements, 
                shall conduct a study of a representative sample of 
                teen parents who are recipients of assistance under 
                State programs funded under this part to determine--
                            ``(i) whether Federal and State data on the 
                        number of such recipients is accurate, 
                        including an examination of the extent to which 
                        such recipients are members of a family that is 
                        not reflected in the data;
                            ``(ii) what assessment procedures are 
                        utilized with such recipients and whether such 
                        procedures would detect a housing or an 
                        educational barrier, such as a learning 
                        disability; and
                            ``(iii) the services and eligibility 
                        requirements for such recipients.
                    ``(B) Report.--Not later than December 31, 2006, 
                the Secretary shall submit to Congress the results of 
                the study conducted under this paragraph.''.
    (c) Research on Tribal Welfare Programs and Poverty Among 
Indians.--Section 413 (42 U.S.C. 613), as amended by subsection (a), is 
amended by adding at the end the following:
    ``(m) Tribal Welfare Programs and Efforts To Reduce Poverty Among 
Indians.--
            ``(1) In general.--The Secretary, directly or through 
        grants, contracts, or interagency agreements, shall conduct 
        research to improve the effectiveness of tribal family 
        assistance programs conducted under section 412 and other 
        tribal welfare programs and on efforts to reduce poverty among 
        Indians.
            ``(2) Priority for certain applications.--With respect to 
        applications for grants under paragraph (1), the Secretary 
        shall give priority to applications to conduct research in 
        cooperation with tribal governments or tribally controlled 
        colleges or universities.
            ``(3) Funding.--Of the amount appropriated under section 
        403(a)(1)(F) for fiscal year 2003, $2,000,000 shall be reserved 
        for the purpose of carrying out this subsection.''.

SEC. 704. INNOVATIVE BUSINESS LINK PARTNERSHIP GRANTS FOR EMPLOYERS AND 
              NONPROFIT ORGANIZATIONS.

    Section 403(a)(4) (42 U.S.C. 603(a)(4)) is amended to read as 
follows:
            ``(4) Innovative business link partnership grants.--
                    ``(A) In general.--The Secretary and the Secretary 
                of Labor (in this paragraph referred to as the 
                ``Secretaries'') jointly shall award grants in 
                accordance with this paragraph for projects proposed by 
                eligible applicants based on the following:
                            ``(i) The potential effectiveness of the 
                        proposed project in carrying out the activities 
                        described in subparagraph (E).
                            ``(ii) Evidence of the ability of the 
                        eligible applicant to leverage private, State, 
                        and local resources.
                            ``(iii) Evidence of the ability of the 
                        eligible applicant to coordinate with other 
                        organizations at the State and local level.
                    ``(B) Definition of eligible applicant.--
                            ``(i) In general.--In this paragraph, the 
                        term `eligible applicant' means a nonprofit 
                        organization, a local workforce investment 
                        board established under section 117 of the 
                        Workforce Investment Act of 1998 (29 U.S.C. 
                        2832), a State, a political subdivision of a 
                        State, or an Indian tribe.
                            ``(ii) Grants to promote business 
                        linkages.--
                                    ``(I) Additional eligible 
                                applicant.--Only for purposes of grants 
                                to carry out the activities described 
                                in subparagraph (E)(i), the term 
                                `eligible applicant' includes an 
                                employer.
                                    ``(II) Additional requirement.--In 
                                order to qualify as an eligible 
                                applicant for purposes of subparagraph 
                                (E)(i), the applicant must provide 
                                evidence that the application has been 
                                developed by and will be implemented by 
                                a local or regional consortium that 
                                includes, at minimum, employers or 
                                employer associations, and education 
                                and training providers, in consultation 
                                with local labor organizations and 
                                social service providers that work with 
                                low-income families or individuals with 
                                disabilities.
                    ``(C) Requirements.--
                            ``(i) In general.--In awarding grants under 
                        this paragraph, the Secretaries shall--
                                    ``(I) consider the needs of rural 
                                areas and cities with large 
                                concentrations of residents with an 
                                income that is less than 150 percent of 
                                the poverty line; and
                                    ``(II) ensure that--
                                            ``(aa) all of the funds 
                                        made available under this 
                                        paragraph (other than funds 
                                        reserved for use by the 
                                        Secretaries under subparagraph 
                                        (J)) shall be used for 
                                        activities described in 
                                        subparagraph (E);
                                            ``(bb) not less than 40 
                                        percent of the funds made 
                                        available under this paragraph 
                                        (other than funds so reserved) 
                                        shall be used for activities 
                                        described in subparagraph 
                                        (E)(i); and
                                            ``(cc) not less than 40 
                                        percent of the funds made 
                                        available under this paragraph 
                                        (other than funds so reserved) 
                                        shall be used for the 
                                        activities described in 
                                        subparagraph (E)(ii).
                            ``(ii) Continuation of availability.--If 
                        any portion of the funds required to be used 
                        for activities referred to in item (bb) or (cc) 
                        of clause (i)(II) are not awarded in a fiscal 
                        year, such portion shall continue to be 
                        available in the subsequent fiscal year for the 
                        same activity, in addition to other amounts 
                        that may be available for such activities for 
                        that subsequent fiscal year.
                    ``(D) Determination of grant amount.--
                            ``(i) In general.--Subject to clause (ii), 
                        in determining the amount of a grant to be 
                        awarded under this paragraph for a project 
                        proposed by an eligible applicant, the 
                        Secretaries shall provide the eligible 
                        applicant with an amount sufficient to ensure 
                        that the project has a reasonable opportunity 
                        to be successful, taking into account--
                                    ``(I) the number and 
                                characteristics of the individuals to 
                                be served by the project;
                                    ``(II) the level of unemployment in 
                                the area to be served by the project;
                                    ``(III) the job opportunities and 
                                job growth in such area;
                                    ``(IV) the poverty rate for such 
                                area; and
                                    ``(V) such other factors as the 
                                Secretary deems appropriate in such 
                                area.
                            ``(ii) Maximum award for grants to promote 
                        business linkages or provide transitional jobs 
                        programs.--
                                    ``(I) In general.--In the case of a 
                                grant to carry out activities described 
                                in clause (i) or (ii) of subparagraph 
                                (E), an eligible applicant awarded a 
                                grant under this paragraph may not 
                                receive more than $10,000,000 per 
                                fiscal year under the grant.
                                    ``(II) Rule of construction.--
                                Nothing in subclause (I) shall be 
                                construed as precluding an otherwise 
                                eligible applicant from receiving 
                                separate grants to carry out activities 
                                described in clause (i) or (ii) of 
                                subparagraph (E).
                            ``(iii) Grant period.--The period in which 
                        a grant awarded under this paragraph may be 
                        used shall be specified for a period of not 
                        less than 36 months and not more than 60 
                        months.
                    ``(E) Allowable activities.--An eligible applicant 
                awarded a grant under this paragraph shall use funds 
                provided under the grant to do the following:
                            ``(i) Promote business linkages.--
                                    ``(I) In general.--To promote 
                                business linkages in which funds shall 
                                be used to fund new or expanded 
                                programs that are designed to--
                                            ``(aa) substantially 
                                        increase the wages of eligible 
                                        individuals (as defined in 
                                        subparagraph (F)), whether 
                                        employed or unemployed, who 
                                        have limited English 
                                        proficiency or other barriers 
                                        to employment by creating or 
                                        upgrading job and related 
                                        skills in partnership with 
                                        employers, especially by 
                                        providing supports and services 
                                        at or near work sites; and
                                            ``(bb) identify and 
                                        strengthen career pathways by 
                                        expanding and linking work and 
                                        training opportunities for such 
                                        individuals in collaboration 
                                        with employers.
                                    ``(II) Consideration of in-kind, 
                                in-cash resources.--In determining 
                                which programs to fund under this 
                                clause, an eligible applicant awarded a 
                                grant under this paragraph shall 
                                consider the ability of a consortium to 
                                provide funds in-kind or in-cash 
                                (including employer-provided, paid 
                                release time) to help support the 
                                programs for which funding is sought.
                                    ``(III) Priority.--In determining 
                                which programs to fund under this 
                                clause, an eligible applicant awarded a 
                                grant under this paragraph shall give 
                                priority to programs that include 
                                education or training for which 
                                participants receive credit toward a 
                                recognized credential, such as an 
                                occupational certificate or license.
                                    ``(IV) Use of funds.--
                                            ``(aa) In general.--Funds 
                                        provided to a program under 
                                        this clause may be used for a 
                                        comprehensive set of employment 
                                        and training benefits and 
                                        services, including job 
                                        development, job matching, 
                                        workplace supports and 
                                        accommodations, curricula 
                                        development, wage subsidies, 
                                        retention services, and such 
                                        other benefits or services as 
                                        the program deems necessary to 
                                        achieve the overall objectives 
                                        of this clause.
                                            ``(bb) Provision of 
                                        services.--So long as a program 
                                        is principally designed to 
                                        assist eligible individuals, 
                                        (as defined in subparagraph 
                                        (F)), funds may be provided to 
                                        a program under this clause 
                                        that also serves low-earning 
                                        employees of 1 or more 
                                        employers even if such 
                                        individuals are not within the 
                                        definition of eligible 
                                        individual (as so defined).
                            ``(ii) Provide for transitional jobs 
                        programs.--
                                    ``(I) In general.--To provide for 
                                wage-paying transitional jobs programs 
                                which combine time-limited employment 
                                in the public or nonprofit private 
                                sector that is subsidized with public 
                                funds with skill development and 
                                activities to remove barriers to 
                                employment, pursuant to an 
                                individualized plan (or, in the case of 
                                an eligible individual described in 
                                subparagraph (F)(i), an individual 
                                responsibility plan developed for an 
                                individual under section 408(b)). Such 
                                programs also shall provide job 
                                development and placement assistance to 
                                individual participants to help them 
                                move from subsidized employment in 
                                transitional jobs into unsubsidized 
                                employment, as well as retention 
                                services after the transition to 
                                unsubsidized employment.
                                    ``(II) Eligible participants.--The 
                                Secretary shall ensure that individuals 
                                who participate in transitional jobs 
                                programs funded under a grant made 
                                under this paragraph shall be 
                                individuals who have been unemployed 
                                because of limited skills, experience, 
                                or other barriers to employment, and 
                                who are eligible individuals (as 
                                defined in subparagraph (F)), provided 
                                that so long as a program is designed 
                                to, and principally serves, eligible 
                                individuals (as so defined), a limited 
                                number of individuals who are 
                                unemployed because of limited skills, 
                                experience, or other barriers to 
                                employment, and who have an income 
                                below 100 percent of the Federal 
                                poverty line but who do not satisfy the 
                                definition of eligible individual (as 
                                so defined) may be served in the 
                                program to the extent the Secretaries 
                                determine that the inclusion of such 
                                individuals in the program is 
                                appropriate.
                                    ``(III) Use of funds.--Funds 
                                provided to a program under this clause 
                                may only be used in accordance with the 
                                following:
                                            ``(aa) To create subsidized 
                                        transitional jobs in which work 
                                        shall be performed directly for 
                                        the program operator or at 
                                        other public and non profit 
                                        organizations (in this 
                                        subclause referred to as 
                                        `worksite employers') in the 
                                        community, and in which 100 
                                        percent of the wages shall be 
                                        subsidized, except as described 
                                        in item (gg) regarding 
                                        placements in the private, for 
                                        profit sector.
                                            ``(bb) Participants shall 
                                        be paid at the rate paid to 
                                        unsubsidized employees of the 
                                        worksite employer who perform 
                                        comparable work at the worksite 
                                        where the individual is placed. 
                                        If no other employees perform 
                                        the same or comparable work 
                                        then wages shall be set, at a 
                                        minimum, at 50 percent of the 
                                        Lower Living Standard Income 
                                        Level (commonly referred to as 
                                        the `LLSIL'), as determined 
                                        under section 101(24) of the 
                                        Workforce Investment Act of 
                                        1998 (29 U.S.C. 2801(24)), for 
                                        a family of 3 based on 35 hours 
                                        per week.
                                            ``(cc) Transitional jobs 
                                        shall be limited to not less 
                                        than 6 months and not more than 
                                        24 months, however, nothing 
                                        shall preclude a participant 
                                        from moving into unsubsidized 
                                        employment at a point prior to 
                                        the maximum duration of the 
                                        transitional job placement. 
                                        Participants shall be paid 
                                        wages based on a workweek of 
                                        not less than 30 hours per week 
                                        or more than 40 hours per week, 
                                        except that a parent of a child 
                                        under the age of 6, a child who 
                                        is disabled, or a child with 
                                        other special needs, or an 
                                        individual who for other 
                                        reasons cannot successfully 
                                        participate for 30 to 40 hours 
                                        per week, may be allowed to 
                                        participate for more limited 
                                        hours, but not less than 20 
                                        hours per week. In any work 
                                        week, 50 percent to 80 percent 
                                        of hours shall be spent in the 
                                        transitional job and 20 percent 
                                        to 50 percent of hours shall be 
                                        spent in education or training, 
                                        or other services designed to 
                                        reduce or eliminate any 
                                        barriers.
                                            ``(dd) Program operators 
                                        shall provide case management 
                                        services and ensure access to 
                                        appropriate education, 
                                        training, and other services, 
                                        including job accommodation, 
                                        work supports, and supported 
                                        employment, as appropriate and 
                                        consistent with an individual 
                                        plan that is based on the 
                                        individual's strengths, 
                                        resources, priorities, 
                                        concerns, abilities, 
                                        capabilities, career interests, 
                                        and informed choice and that is 
                                        developed with each 
                                        participant. The goal of each 
                                        participant's plan shall focus 
                                        on preparation for unsubsidized 
                                        jobs in demand in the local 
                                        economy which offer the 
                                        potential for advancement and 
                                        growth. Services shall also 
                                        include job placement 
                                        assistance and retention 
                                        services, which may include 
                                        coaching and work place 
                                        supports, for 12 months after 
                                        entry into unsubsidized 
                                        placement. Participants shall 
                                        also receive support services 
                                        such as subsidized child care 
                                        and transportation, on the same 
                                        basis as those services are 
                                        made available to recipients of 
                                        assistance under the State 
                                        program funded under this part 
                                        who are engaged in work-related 
                                        activities.
                                            ``(ee) Providers shall work 
                                        with individual recipients to 
                                        determine eligibility for other 
                                        employment-related supports 
                                        which may include (but are not 
                                        limited to) supported 
                                        employment, other vocational 
                                        rehabilitation services, and 
                                        programs or services available 
                                        under the Workforce Investment 
                                        Act of 1998 (29 U.S.C. 2801 et 
                                        seq.), or the ticket to work 
                                        and self-sufficiency program 
                                        established under section 1148, 
                                        and, to the extent possible, 
                                        shall provide transitional 
                                        employment in collaboration 
                                        with entities providing, or 
                                        arranging for the provision of, 
                                        such other supports.
                                            ``(ff) Not more than 20 
                                        percent of the placements for a 
                                        grantee shall be with a private 
                                        for-profit company, except that 
                                        such 20 percent limit may be 
                                        waived by the Secretary for 
                                        programs in rural areas when 
                                        the grantee can demonstrate 
                                        insufficient public and non-
                                        profit worksites. When a 
                                        placement is made at a private 
                                        for-profit company, the company 
                                        shall pay 50 percent of program 
                                        costs (including wages) for 
                                        each participant, and the 
                                        company shall agree, in 
                                        writing, to hire each 
                                        participant into an 
                                        unsubsidized position at the 
                                        completion of the agreed upon 
                                        subsidized placement, or 
                                        sooner, provided that the 
                                        participant's job performance 
                                        has been satisfactory. Not more 
                                        than 5 percent of the workforce 
                                        of a private for-profit company 
                                        may be composed of transitional 
                                        jobs participants.
                                    ``(IV) Definition of transitional 
                                jobs program.--In this clause, the term 
                                `transitional jobs program' means a 
                                program that is intended to serve 
                                current and former recipients of 
                                assistance under a State or tribal 
                                program funded under this part and 
                                other low-income individuals who have 
                                been unable to secure employment 
                                through job search or other employment-
                                related services because of limited 
                                skills, experience, or other barriers 
                                to employment.
                            ``(iii) Capitalization.--To develop 
                        capitalization procedures for the delivery of 
                        self-sustainable social services.
                            ``(iv) Administrative expenditures.--Not 
                        more than 5 percent of the funds awarded to an 
                        eligible applicant under this paragraph may be 
                        used for administrative expenditures incurred 
                        in carrying out the activities described in 
                        clause (i), (ii), or (iii) or for expenditures 
                        related to carrying out the assessments and 
                        reports required under subparagraph (H).
                    ``(F) Definition of eligible individual.--In this 
                paragraph, the term `eligible individual' means--
                            ``(i) an individual who is a parent who is 
                        a recipient of assistance under a State or 
                        tribal program funded under this part;
                            ``(ii) an individual who is a parent who 
                        has ceased to receive assistance under such a 
                        State or tribal program;
                            ``(iii) an individual who is at risk of 
                        receiving assistance under a State or tribal 
                        program funded under this part;
                            ``(iv) an individual with a disability; or
                            ``(v) a noncustodial parent who is 
                        unemployed, or is having difficulty in paying 
                        child support obligations, including such a 
                        parent who is a former criminal offender.
                    ``(G) Application.--Each eligible applicant 
                desiring a grant under this paragraph shall submit an 
                application to the Secretaries at such time, in such 
                manner, and accompanied by such information as the 
                Secretaries may require.
                    ``(H) Assessments and reports by grantees.--
                            ``(i) In general.--An eligible applicant 
                        that receives a grant under this paragraph 
                        shall assess and report on the outcomes of 
                        programs funded under the grant, including the 
                        identity of each program operator, demographic 
                        information about each participant, including 
                        education level, literacy level, prior work 
                        experience and identified barriers to 
                        employment, the nature of education, training, 
                        or other services received by the participant, 
                        the reason for the participant's leaving the 
                        program, and outcomes related to the placement 
                        of the participant in an unsubsidized job, 
                        including 1-year employment retention, wage at 
                        placement, benefits, and earnings progression, 
                        as specified by the Secretaries.
                            ``(ii) Assistance.--The Secretaries shall--
                                    ``(I) assist grantees in conducting 
                                the assessment required under clause 
                                (i) by making available where 
                                practicable low-cost means of tracking 
                                the labor market outcomes of 
                                participants; and
                                    ``(II) encourage States to provide 
                                such assistance.
                    ``(I) Application to requirements of the state 
                program.--
                            ``(i) Work participation requirements.--
                        With respect to any month in which a recipient 
                        of assistance under a State or tribal program 
                        funded under this part who satisfactorily 
                        participates in a business linkage or 
                        transitional jobs program described in 
                        subparagraph (E) that is paid for with funds 
                        made available under a grant made under this 
                        paragraph, such participation shall be 
                        considered to satisfy the work participation 
                        requirements of section 407 and be included for 
                        purposes of determining monthly participation 
                        rates under subsection (b)(1)(B)(i) of that 
                        section.
                            ``(ii) Participation not considered 
                        assistance.--A benefit or service provided with 
                        funds made available under a grant made under 
                        this paragraph shall not be considered 
                        assistance for any purpose under a State or 
                        tribal program funded under this part.
                    ``(J) Assessments by the secretaries.--
                            ``(i) Reservation of funds.--Of the amount 
                        appropriated under subparagraph (L) for each of 
                        fiscal years 2003 and 2004, $3,000,000 of such 
                        amount for each such fiscal year is reserved 
                        for use by the Secretaries to prepare an 
                        interim and final report summarizing and 
                        synthesizing outcomes and lessons learned from 
                        the programs funded through grants awarded 
                        under this paragraph.
                            ``(ii) Interim and final assessments.--With 
                        respect to the reports prepared under clause 
                        (i), the Secretaries shall submit--
                                    ``(I) the interim report not later 
                                than 4 years after the date of 
                                enactment of the Work, Opportunity, and 
                                Responsibility for Kids Act of 2002; 
                                and
                                    ``(II) the final report not later 
                                than 6 years after such date of 
                                enactment.
                    ``(K) Evaluations.--
                            ``(i) Reservation of funds.--Of the amount 
                        appropriated under subparagraph (L) for a 
                        fiscal year, an amount equal to 1.5 percent of 
                        such amount for each such fiscal year shall be 
                        reserved for use by the Secretaries to conduct 
                        evaluations in accordance with the requirements 
                        of clause (ii).
                            ``(ii) Requirements.--The Secretaries--
                                    ``(I) shall develop a plan to 
                                evaluate the extent to which programs 
                                funded under grants made under this 
                                paragraph have been effective in 
                                promoting sustained, unsubsidized 
                                employment for each group of eligible 
                                participants, and in improving the 
                                skills and wages of participants in 
                                comparison to the participants' skills 
                                and wages prior to participation in the 
                                programs;
                                    ``(II) may evaluate the use of such 
                                a grant by a grantee, as the 
                                Secretaries deem appropriate, in 
                                accordance with an agreement entered 
                                into with the grantee after good-faith 
                                negotiations; and
                                    ``(III) shall include, as 
                                appropriate, the following outcome 
                                measures in the evaluation plan 
                                developed under subclause (I):
                                            ``(aa) Placements in 
                                        unsubsidized employment.
                                            ``(bb) Retention in 
                                        unsubsidized employment 6 
                                        months and 12 months after 
                                        initial placement.
                                            ``(cc) Earnings of 
                                        individuals at the time of 
                                        placement in unsubsidized 
                                        employment.
                                            ``(dd) Earnings of 
                                        individuals 12 months after 
                                        placement in unsubsidized 
                                        employment.
                                            ``(ee) The extent to which 
                                        unsubsidized job placements 
                                        include access to affordable 
                                        employer-sponsored health 
                                        insurance and paid leave 
                                        benefits.
                                            ``(ff) Comparison of pre- 
                                        and post-program wage rates of 
                                        participants.
                                            ``(gg) Comparison of pre- 
                                        and post-program skill levels 
                                        of participants.
                                            ``(hh) Wage growth and 
                                        employment retention in 
                                        relation to occupations and 
                                        industries at initial placement 
                                        in unsubsidized employment and 
                                        over the first 12 months after 
                                        initial placement.
                                            ``(ii) Recipient of cash 
                                        assistance under the State 
                                        program funded under this part.
                                            ``(jj) Average expenditures 
                                        per participant.
                            ``(iii) Reports to congress.--The 
                        Secretaries shall submit to Congress the 
                        following reports on the evaluations of 
                        programs funded under grants made under this 
                        paragraph:
                                    ``(I) Interim report.--An interim 
                                report not later than 4 years after the 
                                date of enactment of the Work, 
                                Opportunity, and Responsibility for 
                                Kids Act of 2002.
                                    ``(II) Final report.--A final 
                                report not later than 6 years after 
                                such date of enactment.
                    ``(L) Appropriation.--
                            ``(i) In general.--Out of any money in the 
                        Treasury of the United States not otherwise 
                        appropriated, there is appropriated for grants 
                        under this section, $200,000,000 for each of 
                        fiscal years 2003 through 2007.
                            ``(ii) Availability.--Amounts appropriated 
                        under clause (i) for a fiscal year shall remain 
                        available for obligation for 5 fiscal years 
                        after the fiscal year in which the amount is 
                        appropriated.''.

SEC. 705. GRANTS TO IMPROVE ACCESS TO TRANSPORTATION.

    (a) In General.--Section 403(a) (42 U.S.C. 603(a)), as amended by 
section 304, is further amended by adding at the end the following:
            ``(8) Grant to improve access to transportation.--
                    ``(A) Purposes.--The purposes of this paragraph are 
                to--
                            ``(i) assist low-income families with 
                        children obtain dependable, affordable 
                        automobiles to improve their employment 
                        opportunities and access to training; and
                            ``(ii) provide incentives to States, Indian 
                        tribes, local governments, and nonprofit 
                        entities to develop and administer programs 
                        that provide assistance with automobile 
                        ownership for low-income families.
                    ``(B) Definitions.--In this paragraph:
                            ``(i) Locality.--The term `locality' means 
                        a municipality that does not administer a State 
                        program funded under this part.
                            ``(ii) Low-income family with children.--
                        The term `low-income family with children' 
                        means a household that is eligible for benefits 
                        or services funded under the State program 
                        funded under this part or under a program 
                        funded with qualified State expenditures (as 
                        defined in section 409(a)(7)(B)(i)).
                            ``(iii) Nonprofit entity.--The term 
                        `nonprofit entity' means a school, local 
                        agency, organization, or institution owned and 
                        operated by 1 or more nonprofit corporations or 
                        associations, no part of the net earnings of 
                        which inures, or may lawfully inure, to the 
                        benefit of any private shareholder or 
                        individual.
                    ``(C) Authority to award grants.--The Secretary may 
                award grants to States, Indian tribes, counties, 
                localities, and nonprofit entities to promote improving 
                access to dependable, affordable automobiles by low-
                income families with children.
                    ``(D) Grant approval criteria.--The Secretary shall 
                establish criteria for approval of an application for a 
                grant under this paragraph that include consideration 
                of--
                            ``(i) the extent to which the proposal, if 
                        funded, is likely to improve access to training 
                        and employment opportunities and child care 
                        services by low-income families with children 
                        by means of car ownership;
                            ``(ii) the level of innovation in the 
                        applicant's grant proposal; and
                            ``(iii) any partnerships between the public 
                        and private sector in the applicant's grant 
                        proposal.
                    ``(E) Use of funds.--
                            ``(i) In general.--A grant awarded under 
                        this paragraph shall be used to administer 
                        programs that assist low-income families with 
                        children with dependable automobile ownership, 
                        and maintenance of, or insurance for, the 
                        purchased automobile.
                            ``(ii) Supplement not supplant.--Funds 
                        provided to a State, Indian tribe, county, or 
                        locality under a grant awarded under this 
                        paragraph shall be used to supplement and not 
                        supplant other State, county, or local public 
                        funds expended for car ownership programs.
                    ``(F) Application.--Each applicant desiring a grant 
                under this paragraph shall submit an application to the 
                Secretary at such time, in such manner, and accompanied 
                by such information as the Secretary may reasonably 
                require.
                    ``(G) Reversion of funds.--Any funds not expended 
                by a grantee within 3 years after the date the grant is 
                awarded under this paragraph shall be available for 
                redistribution among other grantees in such manner and 
                amount as the Secretary may determine, unless the 
                Secretary extends by regulation the time period to 
                expend such funds.
                    ``(H) Limitation on administrative costs of the 
                secretary.--Not more than an amount equal to 5 percent 
                of the funds appropriated to make grants under this 
                paragraph for a fiscal year shall be expended for 
                administrative costs of the Secretary in carrying out 
                this paragraph.
                    ``(I) Evaluation.--The Secretary shall, by grant, 
                contract, or interagency agreement, conduct an 
                evaluation of the programs administered with grants 
                awarded under this paragraph.
                    ``(J) Authorization of appropriations.--There is 
                authorized to be appropriated to the Secretary to make 
                grants under this paragraph, $15,000,000 for each of 
                fiscal years 2003 through 2007.''.
    (b) Improving Use of TANF Funds for Car Ownership Matching Funds.--
Section 404(h)(2)(B) of the Social Security Act (42 U.S.C. 
608(h)(2)(B)) is amended by adding at the end the following:
                            ``(iv) Automobile purchase or 
                        maintenance.--At the option of the State, costs 
                        with respect to the purchase or maintenance of 
                        an automobile.''.

SEC. 706. AT-HOME INFANT CARE.

    Section 413 (42 U.S.C. 613), as amended by section 703(c), is 
amended by adding at the end the following:
    ``(n) Demonstration Projects for At Home Infant Care.--
            ``(1) Authority to award grants.--
                    ``(A) In general.--The Secretary shall award grants 
                to not less than 5 and not more than 10 States to 
                enable such States to carry out demonstration projects 
                to provide at-home infant care benefits to eligible 
                low-income families.
                    ``(B) Indian tribes.--An Indian tribe may submit an 
                application for a grant under this subsection. If 
                awarded a grant, the Indian tribe shall conduct a 
                demonstration project to provide at-home infant care 
                benefits to eligible low-income families in the same 
                manner, and to the same extent as a State, except that 
                the Secretary may modify the requirements of this 
                subsection as appropriate with respect to the Indian 
                tribe. For purposes of subparagraph (A), any grant 
                awarded to an Indian tribe shall not count toward the 
                number of grants awarded to States.
            ``(2) Family eligibility.--
                    ``(A) In general.--To be eligible to participate in 
                a program of at-home infant care under a demonstration 
                project established under paragraph (1), a family 
                shall--
                            ``(i) have an income that does not exceed 
                        the limits specified in section 658P(3)(B) of 
                        the Child Care and Development Block Grant Act 
                        of 1990 (42 U.S.C. 9858n(3)(B));
                            ``(ii) include a child under the age of 2;
                            ``(iii) include a parent (as defined in 
                        section 658P(8) of the Child Care and 
                        Development Block Grant Act of 1990 (42 U.S.C. 
                        9858n(8))), who meets the State's requirements 
                        for having had a recent work history prior to 
                        application for at-home infant care benefits; 
                        and
                            ``(iv) meet such other eligibility 
                        requirements as the State may establish.
                    ``(B) 2-parent families.--A State selected to 
                participate in a demonstration project of at-home 
                infant care under this section shall permit 2-parent 
                families to participate in the project but may not 
                limit participation in the project to such families.
            ``(3) Amount of assistance.--The amount of at-home infant 
        care benefits provided to an eligible family under this 
        subsection for a month of benefit receipt shall not exceed the 
        payment rate applicable to eligible child care providers for 
        infant care under the State's payment rate schedule, according 
        to the provisions of section 658E(c)(4)(A) of the Child Care 
        and Development Block Grant Act of 1990 (42 U.S.C. 
        9858c(c)(4)(A)).
            ``(4) Submission of applications.--An eligible low-income 
        parent may submit an application for at-home infant care 
        benefits under a demonstration project established under this 
        subsection at any time prior to the date on which the child 
        attains age 2.
            ``(5) Required certifications.--A State selected to 
        participate in a demonstration project of at-home infant care 
        under this section shall provide certifications to the 
        Secretary that--
                    ``(A) during the period of the demonstration 
                project, the State shall not reduce expenditures for 
                child care services below the levels in effect in the 
                fiscal year preceding the fiscal year in which the 
                State begins to participate in the project;
                    ``(B) the State, in operating the demonstration 
                project, shall not give priority or preference to 
                parents seeking to participate in the program of At-
                Home Infant Care over other eligible parents on a 
                waiting list for child care assistance in the State;
                    ``(C) the State shall--
                            ``(i) provide parents applying to receive 
                        at-home infant care benefits with information 
                        on the range of options for child care 
                        available to the parents;
                            ``(ii) ensure that approved applicants for 
                        at-home infant care are permitted to choose 
                        between receipt of at-home infant care benefits 
                        and receipt of a certificate that may be used 
                        with an eligible child care provider for child 
                        care needed for employment; and
                            ``(iii) provide that a family receiving an 
                        at-home infant care benefit may exchange the 
                        benefit for a child care voucher for employment 
                        at any time during the family's participation 
                        in the program;
                    ``(D) the State shall develop or update and 
                implement a plan to improve the quality of infant care, 
                and shall use up to 10 percent of the funds received 
                under the demonstration project for efforts to improve 
                the quality of infant care in the State;
                    ``(E) the State shall ensure that voluntary 
                employment services are offered to program participants 
                after the completion of participation in the program to 
                assist the participants in returning to unsubsidized 
                employment; and
                    ``(F) the State shall cooperate with information 
                collection and evaluation activity conducted by the 
                Secretary.
            ``(6) TANF assistance.--The receipt of an at-home infant 
        care benefit funded under this subsection shall not be 
        considered assistance under the State program funded under this 
        part for any purpose.
            ``(7) Benefit not treated as income.--Notwithstanding any 
        other provision of law, the value of an at-home infant care 
        benefit funded under this subsection shall not be treated as 
        income for purposes of any Federal or federally-assisted 
        program that bases eligibility, or the amount of benefits or 
        services provided, on need.
            ``(8) Application for participation and selection of 
        states.--
                    ``(A) Applications.--Not later than 90 days after 
                the date of enactment of the Work, Opportunity, and 
                Responsibility for Kids Act of 2002, the Secretary 
                shall publish a notice of opportunity to participate, 
                specifying the contents of an application for 
                participation in the At-Home Infant Care demonstration 
                project funded under this subsection. The notice shall 
                include a timeframe for States to submit an application 
                to participate, and shall provide that all such 
                applications are to be submitted not later than 270 
                days after such date of enactment.
                    ``(B) Selection.--
                            ``(i) In general.--The Secretary shall 
                        review the applications and select the 
                        participating States not later than 1 year 
                        after such date of enactment.
                            ``(ii) Criteria.--In selecting States to 
                        participate in the demonstration project funded 
                        under this subsection, the Secretary shall--
                                    ``(I) seek to ensure geographic 
                                diversity; and
                                    ``(II) give priority to States--
                                            ``(aa) whose applications 
                                        demonstrate a strong commitment 
                                        to improving the quality of 
                                        infant care and the choice 
                                        available to parents of 
                                        infants;
                                            ``(bb) with experience 
                                        relevant to the operation of 
                                        at-home infant care programs; 
                                        and
                                            ``(cc) in which there are 
                                        demonstrable shortages of 
                                        infant care.
            ``(9) Evaluation and report to congress.--
                    ``(A) In general.--The Secretary shall conduct an 
                evaluation of the demonstration projects conducted 
                under this subsection and submit a report to Congress 
                on such evaluation not later than 4 years after the 
                date of enactment of the Work, Opportunity, and 
                Responsibility for Kids Act of 2002.
                    ``(B) Requirements.--The evaluation required under 
                this paragraph shall expressly address the following:
                            ``(i) Implementation experiences of the 
                        States participating in the project in 
                        developing and operating programs of at-home 
                        infant care, including design issues and issues 
                        in coordinating at-home infant care benefits 
                        with benefits provided or funded under the 
                        Child Care and Development Block Grant in the 
                        State.
                            ``(ii) The characteristics of families 
                        seeking to participate and participating in the 
                        programs of at-home infant care funded under 
                        this subsection.
                            ``(iii) The length of participation by 
                        families in such programs and the reasons for 
                        the families ceasing to participate in the 
                        programs.
                            ``(iv) The prior and subsequent employment 
                        of participating families and the effect of 
                        program participation on subsequent employment 
                        participation of the families.
                            ``(v) The costs and benefits of the 
                        programs of at-home infant care.
                            ``(vi) The effectiveness of State or tribal 
                        efforts to improve the quality of infant care 
                        during the period in which the demonstration 
                        project is conducted in the State.
                    ``(C) Reservation of funds.--Of the amount 
                appropriated under paragraph (10) for a fiscal year, 
                $750,000 shall be reserved with respect to each such 
                fiscal year for purposes of conducting the evaluation 
                required under this paragraph.
            ``(10) Appropriations.--Out of any money in the Treasury of 
        the United States not otherwise appropriated, there is 
        appropriated to carry out this subsection, $30,000,000 for each 
        of fiscal years 2003 through 2007.''.

SEC. 707. GRANTS TO CONDUCT DEMONSTRATION PROJECTS ON HOUSING WITH 
              SERVICES FOR FAMILIES WITH MULTIPLE BARRIERS TO WORK.

    Section 413 (42 U.S.C. 603(a)), as amended by section 706, is 
further amended by adding at the end the following:
    ``(o) Interagency Demonstration on Housing With Services.--
            ``(1) In general.--The Secretary and the Secretary of 
        Housing and Urban Development (in this subsection referred to 
        as the `Secretaries') jointly shall award grants for the 
        conduct and evaluation of demonstrations of different models to 
        provide housing with services to promote the employment of 
        individuals who have multiple barriers to work, including lack 
        of adequate housing, and who are--
                    ``(A) parents or caretaker relatives who are 
                eligible for a benefit or service under the State 
                program funded under this part; or
                    ``(B) non-custodial parents of children who are 
                eligible for a benefit or service under such State 
                program.
            ``(2) Requirements.--
                    ``(A) Eligible recipients.--Grants shall be awarded 
                under this subsection on a competitive basis to States 
                and organizations which have exempt status under 
                section 501(c)(3) of the Internal Revenue Code of 1986, 
                including community and faith-based organizations.
                    ``(B) Location.--In awarding such grants, the 
                Secretaries shall ensure that demonstrations are 
                conducted in metropolitan and nonmetropolitan areas.
                    ``(C) Use of funds.--
                            ``(i) In general.--Funds provided under a 
                        grant awarded under this subsection shall be 
                        used for the cost of implementation and 
                        evaluation of the demonstrations conducted with 
                        such funds.
                            ``(ii) Limitation on benefits or services 
                        to noncustodial parents.--Not more than 10 
                        percent of the total amount of grant funds 
                        awarded to a State or organization under this 
                        subsection may be used to provide benefits or 
                        services to noncustodial parents.
                    ``(D) Not considered assistance.--A benefit or 
                service provided with funds made available under a 
                grant awarded under this subsection shall not for any 
                purpose, be considered assistance under the State 
                program funded under this part.
                    ``(E) Duration; availability of funds.--Funds 
                provided under a grant awarded under this subsection 
                shall remain available for a period of 3 years after 
                the date on which the grant is made.
            ``(3) Evaluation.--Not later than December 31, 2006, the 
        Secretaries shall publish an evaluation of the demonstrations 
        conducted under grants made under this subsection.
            ``(4) Authorization of appropriations.--There is authorized 
        to be appropriated to make grants under this subsection, 
        $50,000,000 for fiscal year 2004.''.

SEC. 708. TRANSITIONAL COMPLIANCE FOR TEEN PARENTS.

    (a) In General.--Section 408(a)(5) (42 U.S.C. 608(a)(5)) is 
amended--
            (1) in subparagraph (A)(i), by striking ``subparagraph 
        (B)'' and inserting ``subparagraphs (B) and (C)''; and
            (2) by adding at the end the following:
                    ``(C) Authority to provide temporary assistance.--A 
                State may use any part of a grant made under section 
                403 to provide assistance to an individual described in 
                clause (ii) of subparagraph (A) who would otherwise be 
                prohibited from receiving such assistance under clause 
                (i) of that subparagraph, subparagraph (B), or under 
                section 408(a)(4) for not more than 60 days in order to 
                assist the individual in meeting the requirement of 
                clause (i) of subparagraph (A), subparagraph (B), or 
                under section 408(a)(4) for receipt of such 
                assistance.''.
    (b) Inclusion of Transitional Living Youth Projects as a Form of 
Adult-Supervised Setting.--Section 408(a)(5)(A) (42 U.S.C. 
608(a)(5)(A)), as amended by subsection (a), is further amended--
            (1) by striking ``do not reside in a'' and inserting ``do 
        not reside--
                                    ``(I) in a'';
            (2) by striking the period and inserting ``; or''; and
            (3) by adding at the end the following:
                                    ``(II) in a transitional living 
                                youth project funded under a grant made 
                                under section 321 of the Runaway and 
                                Homeless Youth Act (42 U.S.C. 5714-
                                1).''.

SEC. 709. TANF PROGRAMS MANDATORY PARTNERS WITH ONE-STOP EMPLOYMENT 
              TRAINING CENTERS; STATE OPT-OUT.

    Section 408 (42 U.S.C. 608) is amended by adding at the end the 
following:
    ``(h) Mandatory Partners With One-Stop Employment Training Centers 
Unless State Opt-Out.--For purposes of section 121(b) of the Workforce 
Investment Act of 1998, a State program funded under this part shall be 
considered a program referred to in paragraph (1)(B) of such section, 
unless, after the date of enactment of this subsection, the Governor of 
the State notifies the Secretary of Health and Human Services and the 
Secretary of Labor in writing of the decision of the Governor not to 
make the State program a mandatory partner.''.

SEC. 710. ADVANCED PLANNING DOCUMENT PROCESS FOR INFORMATION MANAGEMENT 
              SYSTEMS PROCUREMENT APPROVAL.

    Not later than 1 year after the date of enactment of this Act, the 
Secretary of Health and Human Services, the Secretary of Agriculture, 
the Secretary of Labor, the Secretary of Education, the Director of the 
Office of Management and Budget, and the chief administering officer of 
any other Federal agency with responsibility for administering a 
federally funded social services program, in consultation with 
representatives of the National Governors Association, the American 
Public Human Services Association, and the National Conference of State 
Legislatures, jointly shall review and submit to Congress a report 
containing recommendations for improving the Federal laws (including 
regulations and guidelines) applicable to the approval of human service 
information systems. The report shall--
            (1) review the advanced planning document process for 
        information management systems procurement approval, in 
        connection with the information management systems required for 
        States to efficiently and effectively operate the social 
        services programs;
            (2) consider the merits of developing a single Federal 
        approval process for multiprogram information system 
        procurement and administration;
            (3) include recommendations for improving the current 
        Federal cost allocation requirements; and
            (4) consider the merits of allowing State procurement 
        standards that meet or exceed Federal standards to be 
        sufficient for purposes of Federal approval.

SEC. 711. WAIVERS.

    (a) Continuation of Prewelfare Reform Waivers.--Section 415 (42 
U.S.C. 615) is amended by adding at the end the following new 
subsection:
    ``(e) Continuation of Waivers Approved or Submitted Before Date of 
Enactment of Welfare Reform.--
            ``(1) In general.--Notwithstanding subsection (a) but 
        subject to paragraph (2), with respect to any State that is 
        operating under a waiver described in that subsection which 
        would otherwise expire on a date that occurs during the period 
        that begins on October 1, 2002, and ends on September 30, 2007, 
        the State may elect to continue to operate under that waiver, 
        on the same terms and conditions as applied to the waiver on 
        the day before such date, through September 30, 2007.
            ``(2) No effect on application of universal engagement and 
        individual responsibility plan requirements.--Notwithstanding 
        paragraph (1), the continuation of a waiver under paragraph (1) 
        shall not affect the applicability of section 408(b) (as 
        amended by the Work, Opportunity, and Responsibility for Kids 
        Act of 2002) to the State.''.
    (b) Approval of Waivers To Duplicate Innovative Programs.--Section 
415 (42 U.S.C. 615), as amended by subsection (a), is further amended 
by adding at the end the following:
    ``(f) Requirement To Approve Waivers To Duplicate Innovative 
Programs.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, if a State submits an application for a waiver of 1 or 
        more requirements of this part that contains terms that are 
        similar or identical to the terms of a waiver eligible to be 
        continued under subsection (e), and the application satisfies 
        the requirements of paragraph (2), the Secretary--
                    ``(A) shall approve the application for a period of 
                at least 2 years, but not more than 4 years, unless the 
                Secretary determines that approval would be 
                inconsistent with the purposes of this part set forth 
                in section 401;
                    ``(B) at the end of the waiver period, shall review 
                documentation of the effectiveness of the waiver 
                provided by the State; and
                    ``(C) if such documentation adequately demonstrates 
                that the program as implemented under the waiver has 
                been effective, may renew the waiver for such period as 
                the Secretary determines appropriate, but not later 
                than September 30, 2007.
            ``(2) Application requirements.--An application for a 
        waiver described in paragraph (1) shall--
                    ``(A) describe relevant State caseload 
                characteristics and labor market conditions;
                    ``(B) specify how the waiver is likely to result in 
                improved employment outcomes, improved child well-
                being, or both;
                    ``(C) describe the State's proposed approach for 
                evaluation of the program under the waiver; and
                    ``(D) include an agreement to conduct an 
                independent evaluation of the waiver and to submit the 
                results of the evaluation to the Secretary.''.
    (c) Conforming Amendment.--Section 415(b)(1) (42 U.S.C. 615(b)(1)) 
is amended by inserting ``, extended under subsection (e), or approved 
under subsection (f)'' after ``(a)''.

SEC. 712. ANTIDISCRIMINATION.

    (a) Nondisplacement in Work Activities.--Section 407(f) (42 U.S.C. 
607(f)) is amended to read as follows:
    ``(f) Nondisplacement.--
            ``(1) In general.--An adult in a family receiving 
        assistance under a State program funded under this part, in 
        order to engage in a work activity, shall not displace any 
        employee or position (including partial displacement, such as a 
        reduction in the hours of nonovertime work, wages, or 
        employment benefits), fill any unfilled vacancy, or perform 
        work when any individual is on layoff from the same or 
        substantially equivalent job.
            ``(2) Prohibitions.--A work activity engaged in under a 
        program operated with funds provided under this part shall not 
        impair any existing contract for services, be inconsistent with 
        any existing law, regulation, or collective bargaining 
        agreement, or infringe upon the recall rights or promotional 
        opportunities of any worker.
            ``(3) No supplanting of other hires.--A work activity 
        engaged in under a program operated with funds provided under 
        this part shall be in addition to any activity that otherwise 
        would be available and shall not supplant the hiring of an 
        employed worker not funded under such program.
            ``(4) Enforcing antidisplacement protections.--
                    ``(A) In general.--The State shall establish and 
                maintain an impartial grievance procedure, which shall 
                include the opportunity for a hearing, to resolve any 
                complaints alleging violations of the requirements of 
                paragraphs (1), (2), or (3) within 60 days of receipt 
                of the complaint and, if a decision is adverse to the 
                party who filed such grievance or no decision has been 
                reached, provide for the completion of an arbitration 
                procedure within 75 days of receipt of the complaint or 
                the adverse decision or conclusion of the 60-day 
                period, whichever is earlier.
                    ``(B) Remedies.--Remedies for a violation of the 
                requirements of paragraph (1), (2), or (3) shall 
                include termination or suspension of payments, 
                prohibition of the placement of the participant, 
                reinstatement of an employee, and other relief to make 
                an aggrieved employee whole.
                    ``(C) Limitation on placement.--If a grievance is 
                filed regarding a proposed placement of a participant, 
                such placement shall not be made unless such placement 
                is consistent with the resolution of the grievance 
                pursuant to this paragraph.
                    ``(D) Nonpreemption of state law.--The provisions 
                of this paragraph shall not be construed to preempt any 
                provision of State law that affords greater protections 
                to employees or to other participants engaged in work 
                activities under a program funded under this part than 
                is afforded by the provisions of this paragraph.
                    ``(E) Non-exclusive procedures.--The grievance 
                procedures specified in this paragraph are not 
                exclusive, and an aggrieved employee or participant in 
                a program funded under a grant made under this part may 
                pursue other remedies or procedures available under 
                applicable contracts, collective bargaining agreements, 
                or Federal, State, or local laws.
    (b) Application of Workplace Laws to TANF Recipients.--Section 408 
(42 U.S.C. 608), as amended by section 709, is further amended by 
adding at the end the following:
    ``(i) Application of Workplace Laws.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, workplace laws, including (but not limited to) the Fair 
        Labor Standards Act of 1938 (29 U.S.C. 201 et seq.), the 
        Occupational Safety and Health Act of 1970 (29 U.S.C. 651 et 
        seq.), title VII of the Civil Rights Act of 1964 (42 U.S.C. 
        2000e et seq.), the Americans with Disabilities Act of 1990 (42 
        U.S.C. 12101 et seq.), and title IX of the Education Amendments 
        of 1972 (20 U.S.C. 1681 et seq.) shall apply to an individual 
        who is a recipient of assistance under the State program funded 
        under this part in the same manner as such laws apply to other 
        workers. The fact that such an individual is participating in, 
        or seeking to participate in work activities under the State 
        program funded under this part in satisfaction of the work 
        activity requirements of the program, shall not deprive the 
        individual of the protection of any Federal, State, or local 
        workplace law.''.
    (c) Neutrality.--Section 408(i) of the Social Security Act (42 
U.S.C. 608(h)), as added by subsection (b), is amended by adding at the 
end the following:
            ``(2) Neutrality.--No funds provided under this part shall 
        be used to assist, promote, or deter organizing for the purpose 
        of collective bargaining.''.
    (d) Study Regarding Compliance With Nondiscrimination Provisions.--
            (1) In general.--The Comptroller General of the United 
        States shall conduct a study to determine--
                    (A) the extent to which States have complied with 
                the requirement of section 408(d) of the Social 
                Security Act (42 U.S.C. 608(d)) that the provisions of 
                law referred to in that section apply to any program or 
                activity which receives funds provided under part A of 
                title IV of the Social Security Act (42 U.S.C. 601 et 
                seq.); and
                    (B) recommendations for improving such compliance.
            (2) Report.--Not later than 1 year after the date of 
        enactment of this Act, the Comptroller General shall submit a 
        report to Congress on the study conducted under paragraph (1).
    (e) Ban on Imposition of Stricter Eligibility Criteria for 2-Parent 
Families.--
            (1) Prohibition.--Section 408(a) (42 U.S.C. 608(a)) is 
        amended by adding at the end the following:
            ``(12) Ban on imposition of stricter eligibility criteria 
        for 2-parent families.--In determining the eligibility of a 2-
        parent family for any benefit or service funded under this part 
        or funded with non-Federal funds counting toward the State's 
        qualified State expenditures under section 409(a)(7), the State 
        shall not impose a requirement that does not apply in 
        determining the eligibility of a 1-parent family for such 
        assistance.''.
            (2) Penalty.--Section 409(a) (42 U.S.C. 609(a)), as amended 
        by section 109, is amended by inserting after paragraph (5), 
        the following:
            ``(6) Penalty for imposition of stricter eligibility 
        criteria for 2-parent families.--
                    ``(A) In general.--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 up to 5 
                percent of the State family assistance grant.
                    ``(B) Penalty based on severity of failure.--The 
                Secretary shall impose reductions under subparagraph 
                (A) with respect to a fiscal year based on the degree 
                of noncompliance.''.
            (3) Assurance of equal treatment.--Section 402(a) (42 
        U.S.C. 602(a)), as amended by section 702(3), is amended by 
        adding at the end the following:
            ``(11) Certification of equal treatment of 2-parent 
        families.--The chief executive officer of the State shall 
        submit to the Secretary a certification that in conducting the 
        State program funded under this part, the State does not have 
        rules or procedures that discriminate against 2-parent 
        families.''.

                      TITLE VIII--OTHER PROVISIONS

SEC. 801. REVIEW OF STATE AGENCY BLINDNESS AND DISABILITY 
              DETERMINATIONS.

    Section 1633 of the Social Security Act (42 U.S.C. 1383b) is 
amended by adding at the end the following:
    ``(e)(1) The Commissioner of Social Security shall review 
determinations, made by State agencies pursuant to subsection (a) in 
connection with applications for benefits under this title on the basis 
of blindness or disability, that individuals who have attained 18 years 
of age are blind or disabled as of a specified onset date. The 
Commissioner of Social Security shall review such a determination 
before any action is taken to implement the determination.
    ``(2)(A) In carrying out paragraph (1), the Commissioner of Social 
Security shall review--
            ``(i) at least 25 percent of all determinations referred to 
        in paragraph (1) that are made in fiscal year 2003; and
            ``(ii) at least 50 percent of all such determinations that 
        are made in fiscal year 2004 or thereafter.
    ``(B) In carrying out subparagraph (A), the Commissioner of Social 
Security shall, to the extent feasible, select for review the 
determinations which the Commissioner of Social Security identifies as 
being the most likely to be incorrect.''.

SEC. 802. CUSTOMS USER FEES.

    Section 13031(j)(3) of the Consolidated Omnibus Budget 
Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)) is amended by striking 
``September 30, 2003'' and inserting ``February 28, 2005''.

                        TITLE IX--EFFECTIVE DATE

SEC. 901. EFFECTIVE DATE.

    (a) In General.--Except as otherwise provided, the amendments made 
by this Act shall take effect on October 1, 2002.
    (b) Exception.--In the case of a State plan under part A or D of 
title IV of the Social Security Act which the Secretary determines 
requires State legislation in order for the plan to meet the additional 
requirements imposed by the amendments made by this Act, the effective 
date of the amendments imposing the additional requirements shall be 3 
months after the first day of the first calendar quarter beginning 
after the close of the first regular session of the State legislature 
that begins after the date of enactment of this Act. For purposes of 
the preceding sentence, in the case of a State that has a 2-year 
legislative session, each year of the session shall be considered to be 
a separate regular session of the State legislature.




                                                       Calendar No. 518

107th CONGRESS

  2d Session

                               H. R. 4737

                          [Report No. 107-221]

_______________________________________________________________________

                                 AN ACT

 To reauthorize and improve the program of block grants to States for 
  temporary assistance for needy families, improve access to quality 
                  child care, and for other purposes.

_______________________________________________________________________

                             July 25, 2002

                       Reported with an amendment