[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 3863 Introduced in Senate (IS)]








109th CONGRESS
  2d Session
                                S. 3863

  To amend part A of title IV of the Social Security Act to require a 
 State to promote economic and financial education under the Temporary 
Assistance for Needy Families (TANF) Program and to allow economic and 
  financial education to count as a work activity under that program.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

            September 7 (legislative day, September 6), 2006

 Mr. Akaka (for himself, Mr. Lautenberg, Ms. Stabenow, and Mr. Obama) 
introduced the following bill; which was read twice and referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL


 
  To amend part A of title IV of the Social Security Act to require a 
 State to promote economic and financial education under the Temporary 
Assistance for Needy Families (TANF) Program and to allow economic and 
  financial education to count as a work activity under that program.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``TANF Economic and Financial 
Education Promotion Act of 2006''.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress makes the following findings:
            (1) Most recipients of assistance under the Temporary 
        Assistance for Needy Families (TANF) Program established under 
        part A of title IV of the Social Security Act (42 U.S.C. 601 et 
        seq.) and individuals moving toward self-sufficiency operate 
        outside the financial mainstream, paying high costs to handle 
        their finances and saving little for emergencies or the future.
            (2) Personal debt levels and bankruptcy filing rates are 
        high and savings rates are at their lowest levels in 70 years. 
        In 2005, the savings rate was negative. The inability of many 
        households to budget, save, and invest prevents them from 
        laying the foundation for a secure financial future.
            (3) Financial planning can help families meet near-term 
        obligations and maximize their longer-term well being, 
        especially valuable for populations that have traditionally 
        been underserved by our financial system.
            (4) Economic and financial education can give individuals 
        the necessary financial tools to create household budgets, 
        initiate savings plans, and acquire assets.
            (5) Economic and financial education can prevent vulnerable 
        customers from becoming entangled in financially devastating 
        credit arrangements.
            (6) Economic and financial education that addresses abusive 
        lending practices targeted at specific neighborhoods or 
        vulnerable segments of the population can prevent unaffordable 
        payments, equity stripping, and foreclosure.
            (7) Economic and financial education speaks to the broader 
        purpose of the TANF Program to equip individuals with the tools 
        to succeed and support themselves and their families in self-
        sufficiency.
    (b) Purposes.--The purposes of this Act are the following:
            (1) To promote economic and financial literacy among 
        individuals receiving assistance under Temporary Assistance for 
        Needy Families programs funded under part A of title IV of the 
        Social Security Act (42 U.S.C. 601 et seq.) by permitting 
        States to include economic and financial literacy education 
        that is provided directly to individuals as a work activity 
        under such programs.
            (2) To provide individuals receiving assistance under 
        Temporary Assistance for Needy Families programs funded under 
        part A of title IV of the Social Security Act (42 U.S.C. 601 et 
        seq.) with the skills and knowledge needed to effectively 
        address personal financial matters and to make financial 
        choices that will lead such individuals toward becoming 
        financially self-sufficient.

SEC. 3. REQUIREMENT TO PROMOTE ECONOMIC AND FINANCIAL EDUCATION UNDER 
              TANF.

    (a) State Plan Requirement.--Section 402(a)(1)(A) of the Social 
Security Act (42 U.S.C. 602(a)(1)(A)) is amended by adding at the end 
the following new clause:
                            ``(vii) Establish goals and take action to 
                        promote economic and financial education in 
                        accordance with a program established under 
                        section 404(l) among parents and caretakers 
                        receiving assistance under the program through 
                        collaboration with community-based 
                        organizations, financial institutions, business 
                        entities, the Financial Literacy and Education 
                        Commission established under section 513 of the 
                        Fair and Accurate Credit Transactions Act of 
                        2003 (20 U.S.C. 9702) and departments and 
                        agencies that are members of such Commission, 
                        including the Department of Agriculture, the 
                        Securities and Exchange Commission, and the 
                        Board of Governors of the Federal Reserve 
                        System.''.
    (b) Program Requirements.--Section 404 of the Social Security Act 
(42 U.S.C. 604) is amended by adding at the end the following new 
subsection:
    ``(l) Economic and Financial Education.--
            ``(1) In general.--Subject to the succeeding paragraphs of 
        this subsection, a State to which a grant is made under section 
        403--
                    ``(A) shall use the grant or State funds that are 
                qualified State expenditures (as defined in section 
                409(a)(7)(B)(i)) to establish a program to provide 
                economic and financial education directly for parents 
                and caretakers receiving assistance under the State 
                program funded under this part; and
                    ``(B) may count a parent's or caretaker's hours of 
                participation in such program as being engaged in work 
                for purposes of determining monthly participation rates 
                under section 407(b)(1)(B)(i).
            ``(2) Requirements.--A State shall ensure that the economic 
        and financial literacy activities conducted under the program 
        established under this subsection--
                    ``(A) are accessible to the target population 
                through curriculum geared to the general literacy level 
                of the participants;
                    ``(B) provide relevant and practical information to 
                participants;
                    ``(C) include a direct delivery component; and
                    ``(D) to the extent practicable, are conducted in 
                conjunction with an asset building program conducted in 
                the State.
            ``(3) Collaboration with nongovernmental or nonprofit 
        organizations encouraged.--In carrying out economic and 
        financial education activities under a program established 
        under this subsection, a State is encouraged to collaborate 
        with nongovernmental or nonprofit organizations with a proven 
        record of educating the public, especially at-risk populations, 
        regarding economic and financial literacy.
            ``(4) Evaluation.--A State shall conduct an evaluation of 
        the economic and financial literacy program established under 
        this subsection not less than once every 3 years for the 
        purpose of--
                    ``(A) monitoring the number of parents and 
                caretakers served under the program;
                    ``(B) improving program administration;
                    ``(C) facilitating replication and expansion of 
                best practices;
                    ``(D) assessing behavioral changes of participants; 
                and
                    ``(E) assessing asset accumulation of participants.
            ``(5) Definition of economic and financial education.--In 
        this subsection, the term `economic and financial education' 
        means education that--
                    ``(A) promotes an understanding of consumer, 
                economic, and personal finance concepts, including 
                basic economic concepts such as supply and demand and 
                opportunity cost, as well as basic financial literacy 
                concepts such as budgeting and money management, 
                saving, retirement planning, maintaining good credit, 
                and the avoidance of predatory lending and financial 
                abuse schemes; and
                    ``(B) is based on recognized standards for economic 
                and financial education.''.
    (c) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section take effect on October 1, 2006.
            (2) Exception.--In the case of a State plan under part A of 
        title IV of the Social Security Act which the Secretary of 
        Health and Human Services 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.
                                 <all>