Authority to prevent and address intentional misuse of subrecipient funds under the TANF program

(a)

In general

Section 417 of the Social Security Act (42 U.S.C. 617) is amended— (1)by inserting (a) In general.— before No; and (2)by adding at the end the following:

(b)

Authority To prevent intentional misuse of subrecipient funds

(1)

Subrecipient monitoring

(A)

In general

The Secretary— (i)shall develop a framework for the monitoring of subrecipient use of funds provided under section 403(a)(1) of this Act, for the purpose of identifying intentional misuse, to supplement single State audits conducted under chapter 75 of title 31, United States Code; (ii)may establish State plan requirements or formats relating to clause (i); and (iii)may request States to report to the Secretary such information to supplement the report provided under section 411(a) as the Secretary determines is necessary to enable the Secretary to comply with clauses (i) and (ii) of this subparagraph. (B)

No effect on single State audit authority

Clause (i) of this subparagraph shall not be interpreted to limit the authority of the Secretary to conduct single State audits under chapter 75 of title 31, United States Code. (2)

Program Integrity Unit authorization and funding

(A)

TANF Program Integrity Unit

The Secretary shall create a TANF Program Integrity Unit at the Administration for Children & Families, which shall conduct the monitoring described in paragraph (1)(A)(i). (B)

Appropriation

Out of any money in the Treasury not otherwise appropriated, the amount made available in section 403(a)(1)(C) for each fiscal year shall be increased by $10,000,000, and the amount of the increase shall be available for the staffing and operations of the TANF Program Integrity Unit and related functions. (3)

Annual report to the Congress

The Secretary shall submit an annual report to the Congress on the activities undertaken under paragraph (2)(A) in the fiscal year covered by the report.

(b)

Remedies

Section 409(a)(1)(B) of such Act (42 U.S.C. 609(a)(1)(B)) is amended— (1)by striking (B) Enhanced penalty for intentional violations.—If and inserting the following:

(B)

Enhanced penalty for intentional violations

(i)

In general

; and

(2)by adding at the end the following:

(ii)

Additional remedies

If the Secretary finds, as a result of subrecipient monitoring under section 417(b)(1) of this Act, that an amount has been intentionally misused in violation of this part, then the Secretary shall— (I)notify the State involved of the finding; and (II)in addition to any penalty imposed under clause (i), require the State to expend, in addition to any other amount required to be expended under the State program funded under this part, an amount equal to the amount so misused, for the provision of cash assistance directly to families with an income below 100 percent of the poverty line (as defined in section 673(2) of the Omnibus Budget Reconciliation Act of 1981, including any revision required by such section, applicable to a family of the size involved).

(c)

Deadline for publication of notice of rulemaking

Within 2 years after the date of the enactment of this Act, the Secretary of Health and Human Services shall publish a notice of rulemaking to implement the amendments made by this section. (d)

Effective date

The amendments made by this section shall take effect on the later of— (1)the 1st day of the 5th calendar quarter that begins after the date of the enactment of this Act; or (2)the 1st day of the 1st Federal fiscal year that begins after such date of enactment.