[House Hearing, 105 Congress]
[From the U.S. Government Publishing Office]



 
             WELFARE REFORM AND CHILD SUPPORT ENFORCEMENT

=======================================================================

                                HEARING

                               before the

                    SUBCOMMITTEE ON HUMAN RESOURCES

                                 of the

                      COMMITTEE ON WAYS AND MEANS
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED FIFTH CONGRESS

                             SECOND SESSION

                               __________

                             JUNE 12, 1998

                               __________

                           Serial No. 105-103

                               __________

         Printed for the use of the Committee on Ways and Means




                       U.S. GOVERNMENT PRINTING OFFICE
63-456                         WASHINGTON : 2000



                        COMMITTEE ON WAYS AND MEANS

                      BILL ARCHER, Texas, Chairman
PHILIP M. CRANE, Illinois            CHARLES B. RANGEL, New York
BILL THOMAS, California              FORTNEY PETE STARK, California
E. CLAY SHAW, Jr., Florida           ROBERT T. MATSUI, California
NANCY L. JOHNSON, Connecticut        BARBARA B. KENNELLY, Connecticut
JIM BUNNING, Kentucky                WILLIAM J. COYNE, Pennsylvania
AMO HOUGHTON, New York               SANDER M. LEVIN, Michigan
WALLY HERGER, California             BENJAMIN L. CARDIN, Maryland
JIM McCRERY, Louisiana               JIM McDERMOTT, Washington
DAVE CAMP, Michigan                  GERALD D. KLECZKA, Wisconsin
JIM RAMSTAD, Minnesota               JOHN LEWIS, Georgia
JIM NUSSLE, Iowa                     RICHARD E. NEAL, Massachusetts
SAM JOHNSON, Texas                   MICHAEL R. McNULTY, New York
JENNIFER DUNN, Washington            WILLIAM J. JEFFERSON, Louisiana
MAC COLLINS, Georgia                 JOHN S. TANNER, Tennessee
ROB PORTMAN, Ohio                    XAVIER BECERRA, California
PHILIP S. ENGLISH, Pennsylvania      KAREN L. THURMAN, Florida
JOHN ENSIGN, Nevada
JON CHRISTENSEN, Nebraska
WES WATKINS, Oklahoma
J.D. HAYWORTH, Arizona
JERRY WELLER, Illinois
KENNY HULSHOF, Missouri
                     A.L. Singleton, Chief of Staff
                  Janice Mays, Minority Chief Counsel
                                 ------                                

                    Subcommittee on Human Resources

                  E. CLAY SHAW, Jr., Florida, Chairman
DAVE CAMP, Michigan                  SANDER M. LEVIN, Michigan
JIM McCRERY, Louisiana               FORTNEY PETE STARK, California
MAC COLLINS, Georgia                 ROBERT T. MATSUI, California
PHILIP S. ENGLISH, Pennsylvania      WILLIAM J. COYNE, Pennsylvania
JOHN ENSIGN, Nevada                  WILLIAM J. JEFFERSON, Louisiana
J.D. HAYWORTH, Arizona
WES WATKINS, Oklahoma

Pursuant to clause 2(e)(4) of Rule XI of the Rules of the House, public 
hearing records of the Committee on Ways and Means are also published 
in electronic form. The printed hearing record remains the official 
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unintentional errors or omissions. Such occurrences are inherent in the 
current publication process and should diminish as the process is 
further refined.
                            C O N T E N T S

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                                                                   Page
Advisory of June 4, 1998, announcing the hearing.................     2

                               WITNESSES

Arizona Department of Economic Security:
    Linda J. Blessing............................................    11
    Nancy Mendoza................................................    66
    Steven J. Esposito...........................................    83
Hershberger, Winifred, Arizona State Legislature.................    58
Intertribal Council of Arizona, John R. Lewis....................    19
Navajo Nation:
    Hon. Tom Atcitty.............................................    26
    Nona Etsitty.................................................    75
Pascua Yaqui Tribe, Hon. Jorge Garcia............................    40


              WELFARE REFORM AND CHILD SUPPORT ENFORCEMENT

                              ----------                              


                         FRIDAY, JUNE 12, 1998

                  House of Representatives,
                       Committee on Ways and Means,
                           Subcommittee on Human Resources,
                                                    Washington, DC.
    The Subcommittee met, pursuant to call, at 10 a.m., in 
Phoenix State Capitol, Senate Hearing Room No. 1, Phoenix, 
Arizona, Hon. E. Clay Shaw, Jr. (Chairman of the Subcommittee) 
presiding.
    [The advisory announcing the hearing follows:]
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    Chairman Shaw. Good morning. We are delighted to be with 
you this morning. Each of us has an opening statement, and I 
will defer to the gentleman from Arizona, Mr. Hayworth, to 
proceed first.
    Mr. Hayworth. Mr. Chairman, I would like to thank you, very 
much, for giving the voices of Arizona's experts on welfare 
reform, child support enforcement, and Native American issues 
such a unique and unprecedented opportunity to be heard. As 
this is the very first House of Representatives Ways and Means 
Committee field hearing in the State of Arizona, I am pleased 
our committee has chosen to focus on issues so acutely critical 
to the health and welfare of Arizonans.
    Mr. Chairman, I know that both you and I are looking 
forward to hearing the testimony from my fellow Arizonans who 
work on a daily basis to ensure welfare benefits are 
appropriately delivered and that child-support payments are 
collected in the most timely fashion.
    I am pleased to hear of the advances Arizona has made in 
these efforts as well as the remaining problems to be 
confronted and the distinctive challenges faced by Native 
American communities in these efforts.
    In fact, I have worked previously with a number of today's 
expert witnesses to reach their respective goals. For instance, 
I was pleased to work with the Arizona Division of Child 
Support Enforcement to incorporate the Division's suggested 
changes into legislation this subcommittee worked on that was 
eventually approved by the House of Representatives.
    Ms. Nancy Mendoza's input as a member of the national 
committee advising on child-support enforcement was critical to 
the successful drafting of federal legislation, and I know that 
many families receiving child-support payments will benefit 
from her efforts.
    In addition, I am pleased to continue working with Navajo 
President Thomas Atcitty in his pursuit of a Section 638 waiver 
to the current welfare program. The Navajo Nation is prepared 
to receive direct welfare, or TANF funding, in order to 
administer its own program, and I think that the Federal 
Department of Health and Human Services wrongly denied the 
Navajo Nation's application for this waiver.
    The Navajo Nation, as most of us know, transcends the 
boundaries of four states. Operating under three separate state 
welfare programs is an administrative nightmare that the 
Department of Health and Human Services should be willing to 
remedy. As I discussed with President Atcitty just this week, I 
will continue to work with this subcommittee and our colleagues 
in Congress to rectify this situation.
    In conclusion, Mr. Chairman, I am honored that we have here 
today two bipartisan panels that include my good friend, the 
Honorable Tom Atcitty, President of the Navajo Nation; Dr. 
Linda Blessing, a national expert in welfare reform; and the 
Honorable Winifred Hershberger, Chairwoman of the Arizona State 
House of Representatives Committee on Human Services, in 
addition to many other qualified witnesses.
    Clearly, each of the folks testifying before us today have 
many important stories and statistics to share that could 
assist other states in their pursuit of these same child-
support collections and welfare-to-work transitions. I am 
thankful that Arizona was chosen to showcase its strengths here 
today, and I look forward to working with local, tribal, state, 
and federal officials to meet current and future goals.
    Once again, I thank you, Mr. Chairman. Before I had the 
opportunity to serve with you on the Ways and Means 
Subcommittee on Human Resources, my fellow Arizonans and I 
never had the chance to have direct representation on these 
issues that are, as we can see from today's turnout, so 
undeniably crucial.
    Most importantly, Mr. Chairman, we have never before had 
the chance to directly weigh in on matters under the 
jurisdiction of this important subcommittee, and I am, 
personally, very grateful to you for giving us that opportunity 
here today.
    Chairman Shaw. Well, thank you, Mr. Hayworth. We are 
delighted to be here, and I, too, want to welcome all our 
guests and witnesses who are testifying today. Or more 
appropriately, thank you all for welcoming this subcommittee 
here to learn firsthand how the 1996 welfare reform law is 
working. I also want to especially thank Governor Jane Hull, 
and the Senate President, Brenda Burns for their help.
    Could I ask? Are these microphones working? You can't tell 
up here. They are working? Thank you.
    Today's witnesses will discuss how the historic welfare 
reform law passed in 1996 has helped move former welfare 
beneficiaries to work. We will also hear about the tougher 
child-support enforcement provisions we passed to help mothers 
and children. And finally, we will examine specific provisions 
we included to renew and improve our commitment to Native 
Americans.
    In advance of the hearing, I asked the Congressional 
Research Service to summarize the ten major provisions in the 
welfare law dealing with benefits for Native Americans, along 
with other provisions on child care and child support.
    Copies of this summary are available with the other 
testimony, and I would ask unanimous consent to include this 
summary in the record. These reports and testimonies are 
located on the table directly outside of this hearing room.
    [The Congressional Research Service summary follows:]
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    Chairman Shaw. This report shows the great effort that went 
into these provisions, and we really worked hard with the 
Native American community to write a good bill. Again, Mr. 
Hayworth was a leader in bringing many of these matters to our 
attention, and I want to thank him for continuing to press this 
case before this Subcommittee and the entire Congress. As many 
of you who know, J.D. know, he is kind of hard to say no to.
    We are also interested in learning about Arizona's 
remarkable turnaround in child-support collections from local 
legislators who designed these programs, from administrators 
who are implementing them, and from Native Americans 
participating in and, in some cases, administering the 
programs.
    The early results of the Welfare Reform Law has been truly 
amazing. Caseloads are down almost 40 percent nationwide, 
including a 45-percent drop right here in Arizona, with record 
numbers of welfare recipients moving to work.
    There are more funds available than ever for child care, 
roughly $70 billion over the next five years. This means that 
with fixed, block-grant funding, you have a situation where 
there are dramatically more funds for services and assistance 
to those who need the most help. This is a great success story.
    But we all know the story doesn't end there. Some families, 
both those still on welfare and also many who have left, need 
continuing support for themselves and their children. That is 
why we provided generous child-care funding, expanded Medicaid 
coverage for moms and kids, and strengthened child-support 
collections, all to encourage work instead of welfare. And we 
expanded the Earned Income Credit to reward working parents. In 
fact, federal spending on Earned Income Credit now greatly 
outpaces spending on cash welfare, which underscores our 
emphasis on work.
    So we seem to be headed in the right direction. And from 
what we can tell, Arizona is a part of this success, if not a 
leader in the success that we are seeing all across this 
country. Still, the reason we reformed welfare was to help 
those who were trapped in the old failed system.
    Because of this, we are committed to understanding how 
welfare reform is working, and we are keeping our minds open 
about further improvements. That is the reason for this hearing 
and the many others we have held and will continue to hold in 
Washington and elsewhere.
    So I want to thank you, again, for welcoming us here today, 
and I look toward to your testimony.
    Mr. Hayworth, would you like to introduce the first panel?
    Mr. Hayworth. I would be honored to, Mr. Chairman.
    Our first panel dealing with welfare reform and Native 
American issues will include Linda J. Blessing, Director of the 
Arizona Department of Economic Security; John Lewis, the 
Executive Director of the Intertribal Council of Arizona; the 
Honorable Tom Atcitty, President of the Navajo Nation, which 
has its capital city in Window Rock, Arizona; and the Honorable 
Jorge Luis Garcia, the Director of Social Services for the 
Pascua Yaqui Tribe from Tucson.
    So if you folks would come to the front table, we would 
appreciate it very much. We thank you for your attendance and 
your willingness to testify, and Dr. Blessing, we would start 
with you.
    Although we have a five-minute rule, we are willing to--we 
will not cut you off right at five minutes. We will try to 
handle that, but we are very happy to have you here and look 
forward to your testimony. And if you would, please, begin.
    Chairman Shaw. I would like to tell all the witnesses that 
we do have your full testimony. We have all but one set of 
testimony, which we will be receiving in Washington. The full 
testimony will be made a part of the record if you wish to 
summarize or proceed as you feel most comfortable.
    And I assume Mr. Lewis is not here.
    Mr. Hayworth. Dr. Blessing, we are happy to hear from you.

STATEMENT OF LINDA J. BLESSING, DIRECTOR, ARIZONA DEPARTMENT OF 
                       ECONOMIC SECURITY

    Ms. Blessing. Thank you. Chairman Shaw and Congressman 
Hayworth, I am Linda Blessing, Director of the Arizona 
Department of Economic Security. It is usually referred to by 
its initials, DES. And on behalf of Governor Jane Hull, I want 
to extend a warm welcome to you. Thank you for this opportunity 
to share some of our experiences in implementing welfare 
reform, especially those in----
    Mr. Hayworth. Dr. Blessing, if you would just give us a 
second, we are going to work out some technical bugs. 
Apparently, the microphones are not working on the table here, 
so we will get that done.
    Now, we welcome John Lewis. Thank you, sir, for taking time 
to be with us today, sir.
    Okay. Apparently, I am told now, if you would just get a 
little closer to the microphone or pull it up, it should work. 
And if you would, resume your testimony.
    Ms. Blessing. Thank you for the opportunity to share some 
of our experiences in implementing welfare reform, especially 
those in partnership with Native American Tribes.
    Arizona has 21 federally recognized Indian tribes. Each is 
unique with a distinctive history, culture, and environment. 
For example, there are the Havasupais, a people who have 
thrived for many years at the base of the Grand Canyon. Anyone 
who hikes down to Havasupai Falls has experienced the 
hospitality of this tribe.
    Arizona has the Navajo Nation, a tribe of more than 200,000 
members, who reside in three states on a reservation 
encompassing 27,000 squares miles, about the same size of West 
Virginia.
    The Salt River Pima Maricopa Indian Community is yet 
another Arizona tribe. Their reservation borders the Phoenix 
metropolitan area.
    As a result of much public input in developing Arizona's 
plan for temporary assistance for needy families' program, we 
identified three principles that were critical to the success 
of the tribal programs.
    First, the state must always recognize the tribes' status 
as a sovereign nation. Second, the state must provide matching 
funds required for operation of tribal TANF programs. Third, 
the tribes should, if they desire, have access to technical 
assistance from DES to design and implement their programs.
    In 1997, the Executive and Legislative Branches passed 
legislation, allocating state funds to any tribe with an 
approved TANF plan.
    Our partnering efforts have resulted in two approved tribal 
TANF plans: The Pascua Yaqui Tribe in November 1997and the 
White Mountain Apache in April of 1998. Two other tribes, the Navajo 
Nation and the Salt River Pina Maricopa Indian Community, have 
submitted plans and currently await federal approval.
    All of these tribes have designed unique programs tailored 
to the specific needs of their members. Those tribes, with 
operational programs, have contracted back with the Department 
of Economic Security to conduct eligibility determinations and 
to help provide the data needed for federal reporting 
requirements. That brings me to the first barrier I wanted to 
discuss and that tribes face in trying to operate their TANF 
programs.
    PRWORA limits funding to 1994 levels and authorizes no 
extra funding for program start-up costs. Like states, tribes 
need sophisticated, automated systems to comply with PRWORA's 
extensive data reporting requirements. In order for tribes to 
start their own TANF programs, they must have additional 
funding to cover the development of social services 
infrastructure, planning, and automated systems.
    In addition, tribal members often face greater barriers to 
self-sufficiency. Many tribes are located in remote geographic 
areas of the state, far removed from urban population centers 
with well-developed economies. There is a severe lack of 
economic opportunity on many reservations.
    Transportation, child care, lack of job opportunities, 
these are common obstacles faced by all welfare recipients 
toward achieving self-sufficiency, but they are greatly 
amplified for tribal members living on reservations.
    Some tribal members live far removed from paved roads. They 
have neither telephones nor electricity. They receive their 
mail at a chapter location which is like a community center. 
And in winter, the dirt roads on which they must travel become 
impassable due to snow and rain. There is no public 
transportation. Finding a job, reaching an employment site, and 
arranging child care may be overwhelming barriers.
    We must work together to overcome these barriers and ensure 
that tribal members have equal opportunity to self-sufficiency 
in a way that respects the tribal status as sovereign nations 
and respects and preserves cultural diversity.
    I would like to give you a few recommendations. First, 
tribes need some incentives and opportunities currently 
available only to states. Tribes must have the option to carry 
over TANF funds to the next fiscal year. They could use these 
funds to meet some of the needs I described earlier or to set 
aside in a rainy-day fund. Tribes should also have the right to 
compete for federal-incentive dollars, such as funding 
available to states that reduce their percentage of out-of-
wedlock births.
    Next, as I mentioned earlier, state-matching funds are 
essential to the tribes to operate their own TANF programs. 
Federal authorities should assist tribal efforts by allowing 
states to use the dollars--count the dollars used for tribal 
matching funds towards state maintenance of effort 
requirements. Some recent proposed federal regulations would 
prohibit states from doing this.
    We understand that there have been some discussions about 
reducing the TANF block grant and other federal funds. I urge 
you to maintain funding at current levels so states can 
continue to meet the needs of our vulnerable populations.
    Third, the tribes that elect to operate their own TANF 
programs need federal funds for start-up costs.
    Thank you for the opportunity to address the subcommittee.
    [The prepared statement follows:]
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    Mr. Hayworth. Thank you, very much, Dr. Blessing, and right 
there on time, the bell rings. While you would never know the 
preparation involved, Dr. Blessing just has a great sense of 
timing, as does our good friend who has joined us now to 
testify, the Executive Director or the Intertribal Council of 
Arizona, John Lewis.
    And John, before you begin the testimony, I see my former 
colleague from broadcasting will move the microphone down so 
that he can record your words for his radio audience, and we 
appreciate all of that help and what has become a very 
collegial effort among members of the fourth estate and those 
of us involved in government.
    And with that, John, thank you for joining us, and we would 
be pleased to hear your testimony, sir.

  STATEMENT OF JOHN R. LEWIS, EXECUTIVE DIRECTOR, INTERTRIBAL 
                       COUNCIL OF ARIZONA

    Mr. Lewis. Good morning. My name is John Lewis, and I am 
the Executive Director of the Intertribal Council of Arizona, 
an organization of nineteen tribal governments. We appreciate 
the opportunity to respond to the subcommittee's question 
whether the Temporary Assistance to Needy Families, TANF, and 
Child-Support Enforcement Programs are providing the help they 
should to American Indians.
    With TANF, the tribal governments are just beginning to 
evaluate the potential impacts of the new policies on their 
membership. With regard to child-support enforcement, there 
continues to remain major impediments to collections for Indian 
families due to lack of resources for tribes to enforce child-
support orders.
    The State of Arizona receives federal funding to conduct 
child-support enforcement activities. The tribes do not. Only 
recently has the Navajo Nation entered into an 
intergovernmental agreement with the state to enforce child 
support. There needs to be direct funding to the tribes to 
develop their codes and their enforcement systems.
    The major welfare reform issue is lack of employment 
opportunities on Indian reservations. Indian families in 
Arizona experience extreme poverty, and there are few 
jobs.While the Indian population comprises 5.6 percent of the 
population in Arizona, approximately fifteen percent of the recipients 
of TANF, or 20,000 individuals, are Indian people who reside on the 21 
Indian reservations in the state.
    Of this population, an estimate of 13,221 individual 
recipients are children, and an estimate of 6,778 are adults, 
according to a September 1997 report from the Department of 
Economic Security.
    While the state of Arizona, particularly Maricopa County, 
has experienced economic growth and labor-market expansion to 
support some of the concepts of welfare reform, such as JOBS 
training, work participation, and time-limited benefits, Indian 
reservations continue to be economically depressed.
    Nine of the reservations in Arizona have jobless rates of 
more than 50 percent, resulting in those populations being 
exempt from time limits on their benefits as provided for in 
the Balanced Budget Act of 1997, P.L. 105-33.
    Few resources exist for economic development initiatives in 
many reservation communities. While gaming enterprises have 
improved economic conditions and provided jobs in some 
communities, the level of resources varies from tribe to tribe.
    There is a great need for infrastructure development: 
roads, telephones, water systems, and skilled labor force in 
order to attract and retain private industry; and this is not 
easily accomplished in rural, often isolated, reservation 
communities.
    These kinds of resources have simply not been available in 
the past; and for some reservations, continue not to be 
available. For those tribes with incomes from gaming, it will 
take time to build infrastructures due to the many years of 
neglect.
    The successful creation of sustainable jobs is also reliant 
on many other factors. These include personal supports such as 
reliable child care, transportation, education, skills 
development, and livable wage.
    The State Legislature and Department of Economic Security 
are commended for their special attention to address the public 
assistance needs of the tribal TANF population in Arizona, for 
providing matching funds to those tribes which opt to 
administer their programs, and for exempting individual 
recipients from loss of benefits in geographical areas where 
extreme economic hardship exists.
    In general, the tribes support the findings of the Rural/
Native American and Safety Net Issues Working Group established 
by the Welfare Reform Joint Committee and Task Force of the 
43rd State of Arizona Legislature.
    I think that part of the success of the tribes in Arizona 
and the state in responding to welfare reform legislation has 
been a long-standing working relationship and the recognition 
of the intergovernmental nature, of the importance of that, and 
the sovereignty of the tribal governments. And we have gone 
through, over the years, a unique way of working together and 
one that I don't think is duplicated in any other state.
    Because of the recognition of the tribal sovereignty, 
because of the government relationship with tribal governments, 
we are--we have built and institutionalized within the 
Department of Economic Security a very good working 
relationship, that when something like welfare reform is 
initiated, we are able to coordinate our efforts to work 
together and share information and, I think, learn from the 
capacities of the responsive entities to address these issues. 
So I think that is the key to what has happened in Arizona.
    Thank you.
    [The prepared statement follows:]
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    Mr. Hayworth. John, thank you, very much, for your 
testimony. We appreciate it.
    And we should note that after we hear from all of the 
panelists, then we will have time for questions.
    I guess it is time to move the radio mike on down so that 
we can hear from our friend, the President of the sovereign 
Navajo Nation, who joins us from Window Rock and points beyond, 
our good friend, the Honorable Tom Atcitty. Mr. President, 
thank you for coming.
    Mr. Atcitty. Yateeh.
    Mr. Hayworth. Yateeh.

STATEMENT OF HON. TOM ATCITTY, PRESIDENT, NAVAJO NATION, WINDOW 
                         ROCK, ARIZONA

    Mr. Atcitty. The Honorable Chair Shaw and Congressman J.D. 
Hayworth, it is good to see you again. I was just visiting with 
you the other day in your office. Seems like everywhere I go, I 
run into you. I guess that indicates that you are working--
hard-working Congressman. Somebody had told us in the hallway 
of your building over there in Washington, J.D. works at night, 
and sometimes they wonder if he even sleeps.
    We appreciate the opportunity and also the willingness to 
show a little latitude and not necessarily limiting us to the 
five minutes, although you did come out all the way to Arizona, 
which is somewhat unusual. We are usually asked to come to 
Washington, and we are required to stay within five minutes, 
and we are shut up and have to leave. But anyway, I appreciate 
your being here in the Southwest in the warm Arizona.
    We are talking about impacts of welfare reform in the 
Navajo Nation. In October of 1997, the Navajo Nation submitted 
an application for TANF program under Public Law 93-638; and 
the following month, on November '97, we got a letter from 
Donna Shalala denying our request. There are a number of 
reasons that we felt that we needed to submit aspecial request 
of this type.
    Presently, we find ourselves in three different regions. 
Our reservation, as was stated, borders into three different 
regions: Dallas, Denver, and San Francisco, so we find 
ourselves in an unwieldy situation to have to deal with those 
different regional offices, so coming with one application 
under the Navajo Nation would keep us working with one region. 
Presently, we find ourselves having a good relationship with 
the San Francisco regional office, so that--just for your 
information, that is what we have experienced in the past.
    After the denial of our request of our application, we 
appealed to the Interior Board of Indian Appeals for a hearing, 
and that appeal was denied. And the next bout was that we 
submitted an appeal further to the Arizona District Court, and 
that is where it presently is. And the Department of Human 
Services has made a motion to dismiss our requests, and that is 
still under litigation, presently.
    We feel that we need to be given a fair opportunity to--our 
argument and our concerns need to be addressed, as we push for 
a fair hearing and consideration as to how we feel that this 
program could be administered, through a Public Law that is--
has been made available to Native Americans through 93-638.
    There are some advantages that we have experienced under 
638, and we--and we have had many experiences with that--
contracting under that Public Law. And we would--for those 
reasons, we would like to continue to see how we can still work 
under that arrangement.
    Presently, we understand that the Indian input on the rules 
and regulations for the TANF--tribal TANF program is still 
under review; and as yet, Native Americans have not been 
requested to participate in the rule-making dialogue. So we 
believe that if we are going to be a participant and a--
participant in the federal program, that we should have a voice 
in how those rules and regulations are developed.
    We also noticed that there is also a lack of coordination 
when we talk about the implementation of the TANF programming, 
that the various entities are working separately. The Human 
Services Department is not necessarily communicating with the 
Department of Labor, which comes down into the Navajo Nation; 
our education and training element of our Navajo program comes 
out of the Department of Labor are not necessarily--they feel 
that they are not necessarily a part of--a contributing part 
of--should be a contributing the TANF program; same way with 
the Department of Transportation, the ISTEA Program.
    And if we are going to have an effective job development, 
there has to be a coordination and communications across the 
board with all departments that are providing the assistance 
and programs to Native Americans. There needs to be a 
cooperation and communication across the board with the various 
federal programs.
    So it has been also said that we need to also seek ways in 
which that financial support for planning and implementation 
phase and the tribal TANF program from the federal government 
be a part of the consideration as well. There is also a 
provision in--with the states under the Section 412 that the 
states get a bonus consideration for complying with the 
provisions of the TANF program.
    However, this program does not--seems to exclude the 
tribes, and we feel that if there is going to be some incentive 
provided for the states, those same kind of incentives ought to 
also be provided to the tribes that are participating in this 
kind of programs. So finally, we would like to recommended that 
we--that the United States government, that we must continue to 
work and contract directly with Indian tribes.
    And presently, in our situation on the Navajo, to deal with 
three different states located in three different regions is 
certainly creating an unwieldy situation, and we need to look 
at it from the government--the government relationship with 
Washington.
    A federal partnership certainly would be one that would 
lend to a better coordination, a better implementation of the 
program. So in order that we all provide that needed assistance 
and the programs to those people that we are trying to bring 
from welfare to work, there has to be a total cooperation, a 
total communication so that we do achieve.
    We, on the Navajo, want to put the Navajos to work, and we 
also need to develop those jobs. We have a big land base, and 
economic development is most lacking, and we have to--we are 
assuming that that is one of our responsibilities, and we hope 
that with the various federal departments that we can work 
together in initiating some economic-development opportunities, 
which certainly equates to employment. So we simply are 
suggesting and asking that we continue to solicit your support.
    And I appreciate our Congressman, here, suggesting that our 
requests for '638 application was certainly not all that out of 
order, and we hope that you will continue to hold that 
position, and I think we can work on an agreement that 
certainly would be beneficial to the population that we are all 
aiming to assist.
    With that, I appreciate your kind attention, and we look 
forward to continuing to working together. Thank you, very 
much.
    [The prepared statement follows:]
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    Mr. Hayworth. Mr. President, we thank you for your 
testimony and look forward to exploring some of those special 
challenges a bit further in just a moment.
    Now, as the microphones are moved down, we will hear 
testimony from our final witness as part of this panel, our 
friend out of Tucson, who is the Director of Social Services 
for the Pascua Yaqui Tribe, the Honorable Jorge Luis Garcia.
    Mr. Garcia, thank you for joining us.

    STATEMENT OF THE HON. JORGE GARCIA, DIRECTOR OF SOCIAL 
         SERVICES, PASCUA YAQUI TRIBE, TUCSON, ARIZONA

    Mr. Garcia. Thank you. Mr. Chairman, bienvenidos to 
Arizona--welcome to Arizona. Mr. Hayworth, welcome back.
    The Social Services Department with the tribe is the tribal 
agency assigned to administer the Pascua Yaqui TANF plan. Ms. 
Irma Valencia, the department's associate director, and myself 
have been involved in the planning, implementation, and 
administration of the tribal TANF plan since its beginning.
    My thanks to Representative Mark Anderson, Representative 
Freddy Hershberger, Representative John Loredo, Senator Tom 
Paterson, Senator Joe Eddie Lopez, and their colleagues for 
having the vision and the legislative fortitude to assure that 
tribes have access to state-matching funds to implement TANF on 
Indian land. My thanks to the Governor Symington for having 
signed the legislation.
    If matching funds were not available to tribes, I would not 
be here. In spite of all the potential negative consequences, I 
would find it very difficult to recommend to the tribal 
chairman and the council that they should pick up the $350,000 
maintenance-of-effort tab to have a tribal TANF plan, 
especially when it has never been an expense to the tribe 
before.
    I thank Dr. Escalante--Fernando Escalante, tribal vice-
chairman, for nudging me to explore the possibilities and 
practicalities of implementing a tribal TANF. It was his 
insistence that pulled me out of the welfare-reform shock.
    I also want to thank Dr. Blessing and her staff for 
entering into an intergovernmental agreement, which has become 
a partnership. I refer to it as a partnership because as 
partners, we problem-solve differences rather than ignoring 
them.
    Dr. Blessing, it is a breath of fresh air dealing with your 
staff. I only pray that your leadership in state-tribal 
relationships rubs off on other state agency directors.
    The Pascua Yaqui TANF began on November 1, 1997, and I am 
here to report to you, Mr. Chairman, Mr. Hayworth, that there 
is success, and more importantly, that there is an 
unprecedented optimism for moving families from welfare to 
employment.
    At Pascua, we have melded the funds from JOBS and Welfare 
to Work with support from JTPA into a concerted effort in 
getting people employed. In the past seven months, fourteen 
persons have entered jobs, most of them at Casino of the Sun.
    On April 6th, three persons entered certified nursing 
assistants' training at Pima Community College and are expected 
to sit for their exam in July. On April 14th, eight persons 
entered a two-year computer tech training course that the 
Department put together and combines work experience with 
community college course work.
    In getting people from welfare to work, our objective is to 
prepare the head of household for employment into the twenty-
first century. Our next task is to develop a linkage with the 
optics industry.
    But not all is rosey. We can pass ourselves off as 
successful at this point only because we are creaming. The 
challenge for us is to instill motivation and desire in that 
TANF subset, which is in danger of being sanctioned for 
noncompliance.
    Over two years ago, the Wall Street Journal reported on 
Marriott's pioneering efforts in moving people from public 
assistance into employment. The conclusion, as I recall it, is 
a very difficult, trying, and time-consuming effort and well 
worth it, and such is welfare reform. It is trying, difficult, 
but it is a well-worth-it process.
    As a social worker who responds to his veteran social 
workers, we cannot forget that TANF subset which has completely 
dropped out instead of dealing with another caseworker who 
tells me that I have to get my act together.
    At Pascua, we have the services to help the adult who wants 
help, provided that she still has Medicaid. The subset that has 
dropped out has probably lost all Medicaid coverage, and it is 
our obligation to be there if and when she wants to begin the 
most difficult journey of her life.
    On the administrative side, tribal TANFs are at a distinct 
disadvantage. I am cheering my Navajo brothers' fight to '638, 
the TANF program, because that will, indeed, bring sorely 
needed administrative dollars for tribal TANF.
    On an annual basis, Pascua will receive approximately one 
point four million dollars from both the state and the feds for 
its TANF. One point three million will go to cash assistance, 
and the balance is budgeted for reimbursement to the state for 
eligibility determination, which means there is no money to 
hire a staff person to administer the tribe's entire welfare-
to-work effort. So it becomes an added burden and sometimes a 
neglected burden of myself and soon to be transferred to the 
associate director.
    I recognize that the federal rules will allow tribes to 
charge a larger administrative cost, currently set at eight 
percent and proposed to be at twenty percent. But the fallacy 
here is that the increase must come from the existing funds, 
which means that the administrative increase must come from the 
available cash assistance. Robbing Peter to pay Paul is not a 
realistic option.
    My recommendation is to award additional dollars to tribes 
to the administration of TANF plan. I suggest twelve percent.
    Secondly, currently, states have the TANF block-grant funds 
available to them until they are expended. Tribes only have the 
funds available two years, and unexpended funds revert to the 
Treasury.
    If the premise is that the money be available to states for 
the anticipated bad economic times, then it should follow that 
the money should be available to the tribes when the tribe 
encounters a downturn in its economic times. Fair is fair, and 
this is downright unfair, particularly when tribes are 
subjected to the same performance requirements as states are.
    Recommendation: Change the law to permit tribes to have 
TANF block-grant funds available until expended.
    Pascua needs more money in its child-care block grant. We 
currently have forty families on the waiting list for child-
care assistance. Tribes are not and will not be as fortunate as 
the states are in having unexpended TANF block-grant dollars 
that can be used for expanding the availability of child care.
    My recommendation is to increase the child-care block-grant 
award to tribes who need it and can use it.
    Thanks to the state legislators, the tribe will receive 
approximately $12,000 to use as transportation assistance, 
something that we have not even skimmed the surface of.
    Pascua's decision to subcontract with the state for 
eligibility determination and benefit issuance was a matterof 
economics and good practice. Currently, an individual using the same 
application form can apply for TANF, medical assistance, and food 
stamps in one location with the state agency. Economies of scale do 
indeed work.
    My thanks to Representative Anderson for planting the seeds 
in law that permit the state, with appropriate federal waivers, 
to subcontract the medical assistance and food stamps 
eligibility functions with tribes with an approved TANF plan.
    I will be calling on Mr. Hayworth's office to encourage the 
Secretary of Health and Human Services and the Secretary of 
Agriculture to approve Arizona's request for the waivers.
    Another welfare-related program that the Pascua Yaqui Tribe 
has a burning interest in accessing is Title IV-E foster-care 
dollars. The fact that IV-E dollars are directly related to the 
receipt of TANF assistance makes it a natural progression of 
services to the tribe to directly assume from the federal 
government.
    Recommend to make Title IV-E dollars directly available to 
tribes with an approved TANF plan; also recommend the 
improvement of IDAs. Individual Development Accounts can assist 
a family's transition from dependence to total sufficiency.
    My congratulations to those thrifty families who manage to 
make contribution to an IDA. And for many of those who make the 
sacrifice but may not be able to achieve ownership, the family 
should be allowed to move into better housing. And that is why 
I am recommending that the first and last months' rent should 
be an eligible IDA expenditure.
    In closing, I wish to thank you for giving me the 
opportunity to share the tribe's infant but mature TANF 
experience, and I look forward to working with you and your 
staff to implement the above recommendations.
    [The prepared statement follows:]
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    Mr. Hayworth. Thank you for your testimony. And Mr. Garcia, 
why don't we just start, since the microphones are there and 
you are right there and you really help set the pace for what 
has transpired here in the state of Arizona.
    Let me ask about the big picture. If you had to prioritize 
what is working best in your mind right now, even taking into 
account the challenges that you have outlined here, what has 
been the central feature that has led to initial success for 
your tribe?
    Mr. Garcia. I think a realization that there is an ending 
time on public assistance that motivates the individual head of 
household and also puts a challenge to the social worker to 
make sure that that person is not left hanging in the end of 
five years.
    Mr. Hayworth. So the deadline really--or the limitation 
really has prompted--served as a catalyst to move people from 
welfare to working.
    Mr. Garcia. In my mind, it has.
    Mr. Hayworth. You did mention something that I think for 
all of us is a bit disconcerting because, even with these 
deadlines, you mentioned dropouts, those who choose to drop out 
of the system, are unaccounted for.
    Do you have any numbers of people? Is there an empirical 
study to show how many people are just washing their hands, not 
trying to make the transition from welfare to work?
    Mr. Garcia. Mr. Shaw, Mr. Hayworth, in our limited 
experience in the past seven months, we have documented ten 
families who have, basically, dropped out.
    Mr. Hayworth. With those ten families, follow-up contact 
has been made. Has there been any reason that they give for 
choosing not to participate?
    Mr. Garcia. Mr. Chair, Mr. Hayworth, there has been no 
formal contact because there has been no provisions to do that. 
The contact that is made has come through other case workers 
who work with the Department, whether they be Child Protective 
Services or our treatment personnel; and their data is 
basically that the family is not willing to try.
    And I can tell you that the unwillingness has to be--is due 
more to a historical, in their life, okay, the consequences of 
living in poverty.
    Mr. Hayworth. Conversely, you mentioned folks reaching out 
for training, finding economic opportunities empirically. I 
think you had some numbers there for us, the numbers of folks 
who are moving into work programs. Could you repeat those for 
me, because I heard those earlier in your testimony? I think 
they bear some amplification.
    Mr. Garcia. Mr. Chairman, Mr. Hayworth, yes, that is 
correct. There were ten people--I mean, fourteen persons who 
have entered jobs. They have become employed primarily at the 
casino, three folks who have entered the certified nursing 
training program at Pima Community College, and persons who are 
in a two-year computer tech program.
    In looking back, what we have is, if you look in the two 
groups, the two subsets, you have a subset who is primarily 
younger, perhaps a little bit more easily to be motivated. 
Whereas the group who has dropped out is primarily older, and 
it is much more difficult to target this, to get this head of 
household to look beyond, you know, today, you know.
    Where it is much easier to go out and say to the younger 
adult, say, look, you need to look at this, you know. No 
longer--you know, you are not going to have it like so-and-so, 
you know. Five years down the road you are going to be off, and 
our job is to get you there and make sure that you have a job 
that is going to give you a decent living, and we are going to 
make sure that the IDA that you are going to start is going to 
be able to get you into home ownership.
    Mr. Hayworth. You also mentioned, and as we heard from the 
other panelists, one of the challenges, certainly there is a 
myth of the monolith, I would call it, that surrounds the 
perception of Native Americans. Tribes confront different 
circumstances. Those in an urban setting, perhaps, can face 
different challenges from the sovereign Navajo Nation, given 
its size and rural setting, if you will.
    But you mentioned something else about Tucson that I am 
interested in and that is the growth of optical programsthere, 
and that will be your next area of emphasis, based on what is emerging 
as a solid foundation of the economy in the Tucson area.
    Mr. Garcia. Mr. Chairman, Mr. Hayworth, that is correct. We 
see that as--I personally see that as a good career, where we 
can train folks into entry positions; and then it is only up to 
their individual efforts to--whether to excel in them or to 
just founder in them.
    Mr. Hayworth. Thank you, sir.
    If I could, let me have the microphones moved down to my 
good friend, the President of the Navajo Nation, Mr. Atcitty.
    Mr. President, I think it bears some amplification. You 
brought it forth in the testimony, and I am not sure how many 
people are aware. The tribal boundaries, the reservation 
boundaries transcend the borders of four states.
    And when it comes to temporary assistance for needy 
families, you have to work with three regional offices, given 
the geographic placement of the sovereign Navajo Nation. So you 
are working with Denver, Dallas, and San Francisco.
    Mr. Atcitty. That is right. Utah is in the Denver region, 
Arizona is in the San Francisco region, and New Mexico is in 
the Dallas region.
    Mr. Hayworth. Well, just given those logistics, it makes it 
very--it is almost like having your shoelaces tied right there 
at the starting line, in terms of travel budgets and how to 
coordinate and----
    Mr. Atcitty. And the other concern that we have, also, is 
that the law has a five-year sunset. And Arizona and Utah began 
a lot--two years earlier than New Mexico. So--and in fact, they 
all start--entered the program at different times, so they will 
be terminating.
    Arizona and Utah are for, I believe, two or three years; 
and New Mexico, I think, was going two years, but then the 
Legislature intervened and is going for five years, as I 
understand it.
    Mr. Hayworth. So just as the state borders, it almost 
offers a--I hate to use this term; I don't mean to be--almost a 
crazy quilt. You have got different limitations, different 
requirements to meet, based on working with the respective 
states, which you find--in which you find parts of your 
reservation.
    Mr. Atcitty. That is right. The effective dates and the 
terminating dates are all different.
    Chairman Shaw. Would the gentleman--do you mind if I----
    Mr. Hayworth. Gladly.
    Chairman Shaw. While we are trying to simplify things, that 
sounds like it is a complication that was unforeseen.
    What would prevent HHS from designating one regional office 
to cross the border of various states where you have one 
entity, such as one Indian Nation to administer? I mean this is 
a nightmare----
    Mr. Atcitty. Mr. Chairman----
    Chairman Shaw [continuing]. Of the bureaucracy.
    Mr. Atcitty. Yeah. Mr. Chairman, Mr. Hayworth, we have 
had--participated in various programs across the country that 
are also represented by three different regions. And because of 
that realization, we went straight to Washington to get 
straight funding, rather than through an agreement with the 
states and so forth or working through the region.
    But in some cases, though, where regional office contact 
was deemed necessary or important, that we went ahead and 
worked with one region. And I think in most cases, we worked 
with the San Francisco regional office.
    Chairman Shaw. Now, that is in other programs. With the 
TANF program, you haven't had that result though; is that 
correct?
    Mr. Atcitty. Like the OEO, back in the OEO days----
    Chairman Shaw. Yeah.
    Mr. Atcitty [continuing]. We had direct funding. We had 
what we call ONEO, which got direct funding to the Navajo, 
and--but we worked with the San Francisco regional office in 
that instance.
    Chairman Shaw. But TANF, you are having to work with three 
offices.
    Mr. Atcitty. With the TANF, there is no provision. I think 
those could be written out if we are included in the rules 
and--negotiated rule making--a participant in that exercise.
    Chairman Shaw. That is something I want to get into, too, 
because to me, that is unconscionable, that you are not 
included.
    Congressman Hayworth and I sat down with governors all 
across this country and made them part of the project of 
drawing up welfare reform, which I think has been the most 
successful piece of legislation written this century by the 
United States Congress.
    For instance, for the first time, we are trying to simplify 
things, and we are trying to make things work. And I think the 
fact that you are not included in the rule making simply is 
going in the wrong direction. Because in drafting the 
legislation, we included the governors, Democrats and 
Republicans, all across this country, and we got great 
cooperation. And as a result, we got a great program that is 
really working.
    Now, I think in the instance of working with Native 
Americans that are part of--very much a part of this TANF 
program and coming up with the rules and regulations within 
that, I think it is very important that HHS include you in that 
process.
    And I am sure J.D. will want to start that, at least let 
them know what the feeling in Congress is about that, and I 
certainly will join in his effort in doing that.
    Mr. Atcitty. I will be making a separate plea, also, to HHS 
for inclusion in the rule-making process so that our peculiar 
situation certainly ought to be aired in those committees, and 
accommodations ought to be provided.
    Mr. Hayworth. Just to echo the Chairman's point--and this 
is something we have seen and perhaps, Mr. Chairman, it will 
call--it could call for oversight hearings from our 
subcommittee--we have noticed in a variety of different areas, 
for example, our friends from the Intertribal Council and from 
these two sovereign Indian Nations will note, that in the 104th 
Congress, we were active in housing in addition to welfare 
reform, the Hayworth/Lazio Indian Housing Act.
    And sadly, what happens is that when we try to redesign to 
put power in the hands where it belongs, in the hands of tribal 
leaders and the respective tribally appointed entities or 
elected entities, a funny thing happens on the way to self-
determination.
    It seems that Washington forces its way in, in terms of the 
bureaucracy, to say, well, let us write these. Let us take care 
of these. And you agree with us, don't you?
    And it is almost, dare I say--and I am not here to hurl 
partisan brick bats, but almost a type of paternalism seemsto 
envelope a number of solutions that Washington tries. And I dare say, 
sadly, with HHS, again, we are seeing this in the waiver that the tribe 
wants, and I believe deserves, and we will continue to work in that 
regard, Mr. President, to get that done.
    In a broader sense, we take a look at the Navajo Nation, 
indeed other tribes, and here is a report from the 
Congressional Research Service talking about federal programs 
of assistance to Native Americans.
    If you go through this, by my count, there are about 250 
programs stretching across more than twenty-five federal 
agencies, all designed to try and help Native Americans with 
housing, food, health care, a variety of other needs. This in 
fact, is probably a partial list.
    And Mr. President, during your testimony, you were talking 
about that lack of federal cooperation and communication, not 
only among departments but certainly, as we have seen once 
again, with the sovereign tribal governments.
    Mr. President, I believe your testimony this morning very 
eloquently compels us to work with you and other tribal leaders 
and, of course, with the good input we have from the 
intertribal council here in Arizona, to try and find a better 
way to coordinate, whether it is total block granting or some 
system that works, to make sure that those of you charged and 
tasked constitutionally by your sovereign governments with 
dealing with these challenges have an effective way to deal 
with these problems. What are your thoughts on that?
    Mr. Atcitty. That certainly would be something that we 
would appreciate. The less strings attached and the less 
restrictive regulations and the opportunity for us to address 
the real needs and concerns in the way we see and the way we 
understand the people's needs, I think, would be a lot more 
beneficial to the people, rather than somebody telling us, you 
know, this is the way you need to administer it, whether it is 
appropriate or not.
    And I think that we need--not every situation is the same. 
Not every tribe is the same, just like not every city or state 
is the same. I think that is--we need to approach it in our own 
unique, distinctive, individual tribal manner.
    Mr. Hayworth. I think that is well said, Mr. President.
    Mr. Chairman, do you have any questions for Mr. Atcitty?
    Chairman Shaw. No, but I would like to go back to Dr. 
Blessing, if I could, for a moment.
    In the recommendations that you have made to the 
legislation, you were talking about start-up costs, and we have 
heard this from the other witnesses too. What would you 
estimate that to be?
    Ms. Blessing. Mr. Chairman, it is difficult to estimate, 
because each tribal government is able to design their program 
to their own specifications, so it is really hard to project. 
But certainly, significant automation systems that we have 
developed statewide cost many millions, sometimes ten to twenty 
million, to serve the statewide population for a sophisticated 
automation system like our child-support enforcement system or 
our child-welfare system.
    So depending on the complexity of the policies that the 
tribal government proposed, I think it could be substantial 
amounts of money.
    Chairman Shaw. I think in your testimony you talked about 
how many of the tribes are doing their own TANF program. What 
was it? Twenty of them statewide?
    Ms. Blessing. Mr. Chairman, running their own program, so 
far, there are two tribes in Arizona that have received federal 
approval to do that. Two more tribes are pending approval, but 
we do have twenty-one tribes within the state.
    Chairman Shaw. And would you anticipate that all twenty-one 
would want to pursue that course?
    Ms. Blessing. Not necessarily, Mr. Chairman. We have one 
tribe that is in very good shape financially for its tribal 
members because of Indian gaming, for example, they have 
essentially no members on public assistance. So--and some of 
the tribes are better situated with economic development; some 
are not.
    But I would point out that of the twenty-one tribes in 
Arizona, nine of them were exempted from some federal time 
limits as a result of over fifty percent unemployment.
    Chairman Shaw. Yeah.
    Ms. Blessing. So by far, we have more tribes that have 
challenges than not. I think many of them will pursue their 
separate plans, and we are eager to work with them as a 
department.
    Chairman Shaw. Is there any practical way they could use 
some of the state resources to get those programs started up?
    Ms. Blessing. Yes, Mr. Chairman.
    Chairman Shaw. Something that you indicated in your 
testimony is not going to happen if all twenty-one decided they 
wanted to go it alone. Then you would have twenty-one programs, 
twenty-one start-up costs. And all of a sudden, you see that--
and then you start spreading that nationwide, and you say, 
whoa, wait a minute. We are out of funds here.
    Ms. Blessing. Yes, Chairman Shaw. There is one mitigating 
factor. Already the two tribes that are operational in Arizona 
have opted to contract with the Department to determine 
eligibility and handle some of the federal data reporting. So 
that substantially reduces the automation needs.
    But there still are other start-up issues: planning, staff, 
people who could design the policies; some other infrastructure 
issues: office space, perhaps. So it can be mitigated to the 
extent tribes choose to work with existing state systems.
    Chairman Shaw. Mr. Lewis, would you like to comment on the 
start-up cost and what is involved? And then, also, I want to 
get to talk to you a minute about the road problem that you 
mentioned in your testimony.
    Mr. Lewis. Okay. Well, with the start-up costs, I think 
that area is something that is very, very critical and for 
tribes to really consider.
    I think, first of all, the big hurdle was the matching. And 
even with that, the state provides eighty percent of the 1994 
level. And I think it would be really important if the policy 
could be made to extend that to a hundred percent. Again, that 
would help in the start-up costs.
    The other is that the state match for the tribes that has 
been provided should be credited to the state, which it is not, 
and that enables the state to continue to provide additional 
support to tribal governments and other communities in the 
state.
    So I think those two resources are there, and I think there 
is--you know, that is an oversight in terms of the legislation. 
Those things could be remedied, and those couldbe a good base 
for starting and looking at where do we get those costs. But as has 
been mentioned, the tribes are relatively small and have relatively low 
numbers in terms of TANF recipients, and so they would not be seen as 
taking on that responsibility.
    But if some of these other--the needs are there; and what 
TANF has done is to allow tribes to have that option and to be 
able to design what could best work for them in a way that best 
works for them, and that is a very important principle, and to 
allow some of their own tribal members to design and work with 
them. That is important, and that could be extended in terms of 
some of the tribes to do intertribal efforts in terms of--like 
you had mentioned. And I think that is a possibility.
    But some of the basic start-up costs and where it comes 
from needs to be answered. Some of the remedies are here, and I 
think that is where we can begin.
    Chairman Shaw. Under welfare reform, and it seems that what 
I am hearing is that you are talking about one of the biggest 
advantages of being able to have your own program and setting 
up your own program is because you can design it to best fit 
the needs of the people it is going to serve.
    Under the Welfare Reform Bill, we gave the states 
flexibility of designing different programs within their own 
state. There is nothing that would say that one shoe fits all, 
that all across the state of Arizona, all the programs have to 
be the same.
    You can set them up regionally, or I would think, under the 
legislation, that if a tribe wants to design a program within 
their tribe with the cooperation of the state, they could 
stipulate--operate under the, say, TANF program and have their 
own design.
    We tried as hard as we could, and I think that is part of 
the success of this legislation, we got away from what we call 
the Beltway mentality, and that is why we are out here, by the 
way, to get away from the Beltway mentality and let Mr. Atcitty 
proceed longer in his testimony than he could have in 
Washington.
    But it is important that we know what is out here, that we 
know the true feelings, and that we come out and collect this 
information. I think this has all been tremendously helpful.
    Mr. Hayworth. I just have one question for my friend John 
Lewis from the Intertribal Council representing nineteen 
tribes.
    We have heard about economic development, job development, 
Pascua Yaqui. We know about the special challenges confronted 
by the Navajo Nation.
    And while we are in that neighborhood, we tip our hat, 
rhetorically, to our friend Congressman Bill Redmond of New 
Mexico, who has worked very hard on a variety of projects 
economically with the Navajo Nation, I think, in particular, 
the processing plant for the potato farm, working very hard 
there, that President Atcitty has worked very hard with 
Congressman Redmond and others on.
    But I am interested in the big picture as we shatter that 
myth of the monolith and know that there are different tribes 
with different circumstances. John, I think perhaps you are in 
a better position to give us the big picture.
    In terms of the job development side of the welfare-to-work 
equation for the different tribes represented and participating 
in the Intertribal Council, where do you think we need to head 
with that? Or how do you see economic and job development 
proceeding with the nineteen tribes?
    Mr. Lewis. I think, to begin with, some of the existing 
federal programs that Congress certainly has oversight on or 
can be creative in making them work better. And I think part of 
that is some looking at how they can be better coordinated in 
terms of policy, how tribes can take all those different 
programs and, in a sense, maybe head towards a block grant in 
terms of what is available now, and much--I think the type of 
thought that went into creating TANF and the need for that, 
focusing on the individuals and moving them towards work.
    The other part of that picture is to create--help create an 
economic environment where there are jobs and to help stimulate 
that and to help to identify what it is that moves individuals. 
And I think there are a lot of good programs, a lot of the good 
efforts out there in our communities, I think, to help do that, 
but a lot of times, just making it more accessible and more 
easily administrated through some coordinated policy or some 
block-grant approach would help.
    The other is with the state itself, the state here in 
Arizona looking at work-force development. And again, this is 
the approach that has been taken here. And I understand that we 
are in the process of really a model development towards work 
force development.
    We are doing that in the state, looking at all these 
programs, coordinating them, putting some focus on relating 
them to the private sector and their priorities and then, 
including the tribes in terms of that effort--so as part of the 
statewide economic picture or regional picture, and doing that 
sort of assessment and analysis and focus is needed.
    And that effort is an ongoing effort, and it is going to 
take a number of years to do that, but it has started here in 
Arizona, and the tribal governments are a part of that, so that 
is a good aspect; likewise, with the tribes, the tribes 
themselves are taking a look at their administrations, their 
resources, and coordinating them as well.
    But there also has to be some access and communication in 
working relationships, particularly with the private sector, 
with financial institutions, and other things that have been to 
some degree related.
    So there has to be some real sit down and talk in terms of 
how best to build those relationships. There may be a role for 
Congress, in terms of its policies, in guiding some of those 
relationships and working relationships, but they are being 
established.
    So it is going to take that sort of interest and efforts 
on--from the federal level, state level, and tribal level to 
have that creation, because the tribes, as I mentioned in 
testimony, have--had not been--had the access to many resources 
and have not been integrated into a lot of ongoing plans on a 
regional or statewide basis. And some of the legislation in 
Congress has not recognized that.
    The USDA has initiated a program in terms of developing 
empowerment areas or regions. Nationally, they are only going 
to be funding one, possibly two, out of five hundred and some 
odd tribes. But those are efforts that really do bring a 
comprehensive approach, really do bring a cooperation in terms 
of the initial planning and development with all sectors of the 
tribe and external relationships. Those are the types of things 
that need to happen.
    Here in the state, we have the Greater Arizona Development 
Authority, which is focusing on rural areas andbuilding and 
providing an opportunity for them to take a look at themselves and 
build those linkages and stimulate their economies. But that has been a 
special effort by the State Legislature to do that, and the private 
sector, to bring that about. So those are the types of things that are 
going to be needed and more of them.
    Mr. Hayworth. Thank you, Mr. Lewis, very much.
    Mr. Chairman.
    Chairman Shaw. Thank you. I just want to mention one thing 
to you, Mr. Lewis, and this probably applies to some of the 
other tribes. In the ISTEA Bill, the highway bill, there was a 
small portion of funds--I say small; it is big in terms of 
dollars, but in terms of Washington spending, it may have 
slipped by, particularly the size of that bill that was 
monstrous--there is welfare--there is some money in there that 
is going to be available for transportation to help people out 
of welfare.
    And I would strongly suggest that in some of these dirt 
roads that you spoke about, that you take a close look at that 
bill and see what is in there and compete for some of those 
funds, because I think they would be very helpful.
    Having gone to Arizona rules instead of Washington rules, 
we are going to run out of time if we continue with this panel, 
because we have another panel that we want to hear from.
    But we very much appreciate each of your testimony. I have 
learned a lot, and I think this will be very helpful in 
improving this legislation and assisting Congressmen in getting 
some of these changes and some of these rule-making conferences 
on a better track, and I thank each of you for being with us 
this morning.
    J.D., would you like to introduce the next panel?
    Mr. Hayworth. I would be honored to. Mr. Chairman, we are 
very pleased to welcome our next panel, which will deal with 
the topic of welfare reform and child-support enforcement. And 
I am especially pleased to first call forward the Honorable 
Winifred Hershberger, State Representative from our State 
Legislature right here.
    And as Freddy comes up, I just want to take time to 
congratulate her on having been selected the 1997 legislator of 
the year by the National Child Support Enforcement Association. 
We know that is an honor for you personally, Representative 
Hershberger, but also for the state of Arizona. And we would 
like to thank you for your wonderful service and look forward 
to your testimony as it comes to us.
    And also welcome, Mr. Chairman, and those who join us 
today, someone who has joined us in Washington to testify, but 
we are pleased that she gets to play a home game, as it were, 
and the Chairman is playing on the road, our Assistant Director 
for the Division of Child Support Enforcement, Nancy Mendoza 
from the Arizona DES, or Department of Economic Security.
    Also we are pleased to have a tribal advocate from the 
Navajo Nation Department of Justice in Window Rock. Nona 
Etsitty joins us. And Nona, we thank you for coming.
    And the administrator from the Division of Child Support 
Systems and Automation from the Arizona Department of Economic 
Security Steve Esposito is here as well. So Steve, if you will 
come up front and center, please; and begin with our legislator 
of the year, Freddy Hershberger. Representative Hershberger.

   STATEMENT OF WINIFRED HERSHBERGER, STATE REPRESENTATIVE, 
                   ARIZONA STATE LEGISLATURE

    Ms. Hershberger. Thank you, Chairman Shaw and Congressman 
Hayworth.
    And I have got to say, first, I thank you for those nice 
remarks, but Nancy is the one who should have won the award.
    Mr. Hayworth. We will let you share it with her, and that 
will be a part of our record today. Let the record reflect that 
Freddy believes that Nancy should share in those accolades and 
that honor.
    Ms. Hershberger. I am Freddy Hershberger. I have been a 
member of the Arizona State Legislature since 1993. I currently 
serve as chairman of the Human Services Committee of the House, 
and this committee deals with many of the same issues at the 
state level as your committee does at the national level.
    In addition to child-support enforcement, which is the 
subject of today's hearing, the Arizona House Human Services 
Committee serves as the committee of reference for child-
welfare issues, and I know you share my deep commitment to 
addressing the needs of children.
    In my role as chair of the House Human Services Committee, 
I cochair the state's Child Support Coordinating Council, which 
has served as a unique forum for the resolution of issues for 
both IV-D and non-IV-D child-support matters. Perhaps our model 
can serve as an example of how other states can resolve 
differences among the stakeholders in the child-support 
programs.
    As you are well aware, the child-support-enforcement 
program affects parties with competing interests, requires the 
involvement of several levels of government, and impacts 
significantly upon employers and others in the private sector. 
It can be very difficult to achieve a measure of consensus 
among these different interests.
    And in the light of the complexity of the issues at stake 
and in recognition that public stewardship on these matters was 
needed, the Legislature created the Child Support Coordinating 
Council in 1994. It is cochaired by a member of the Senate and 
a member of the House. The current cochairman of the Senate is 
Senator David Petersen, who is also Chair of the Senate Family 
Services Committee.
    The Council is comprised of twenty-two members, including 
representation from the Department of Economic Security, which 
administers the IV-D program; the Attorney General's Office, 
the courts, the governor's office, custodial and noncustodial 
and joint-custodial parents, business community, and 
legislators from both parties and both Houses.
    The council serves as a forum for all system stakeholders 
to develop and coordinate policies and strategies to 
improvechild-support enforcement. It has been extremely successful in 
dealing with many potentially controversial and divisive issues and has 
performed an enormous service by bringing forward solutions for 
legislative consideration.
    Among the many accomplishments of the Council, I would like 
to highlight a few. First, and probably of greatest interest to 
you, Mr. Chairman and to Congressman Hayworth, is the work 
performed by the Council in considering the child-support 
enforcement state law changes required by the Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996 
for welfare reform.
    Following the passage of the final federal legislation, DES 
began bringing bill drafts to the Council to obtain feedback 
and to identify areas where state discretion was allowed. Many 
revisions were made prior to the bill being introduced in the 
State Legislature. I am that sure you have followed the 
struggles in many states in getting conforming legislation 
enacted.
    In Arizona, we passed our bill with only three dissenting 
votes in both chambers. I credit the work of the Council in 
obtaining stakeholder consensus prior to the session with our 
ability to have such a successful outcome.
    I would like to comment specifically on one provision of 
the federal welfare reform requirements where I believe that 
the Council and Arizona have overcome problems being 
experienced in other states. I am referring to our requirement 
that the processing of child-support payments be centralized 
for both IV-D and non-IV-D cases.
    In Arizona, as in many other states, non-IV-D payments are 
processed by local Clerks of the Court. In recognition that 
having several locations to which payment must be sent is a 
burden to employers, the Council had begun considering 
centralization prior to the federal requirement and had reached 
a consensus on the need for centralization. The legislation 
necessary to achieve this was included in the welfare reform 
conforming bill.
    However, we went one step further than did Congress. The 
Council felt that centralizing only payments for cases with 
post-1994 orders, as required by Congress, would leave 
confusion in the system and a twelve-year burden to employers 
as the older cases age out. In order to truly simplify and 
streamline payment processing, all payments need to go to a 
single location. I encourage you to reconsider the effect of 
the limitation the federal law has imposed.
    The centralization of payment processing is extremely 
difficult. The Child Support Coordinating Council is serving as 
the facilitator of this process by working with the Clerks' 
Association, the IV-D Agency, and the Administrative Office of 
the Courts to convert to centralized payment processing for all 
IV-D and non-IV-D payments this fall. We have overcome the 
concerns raised in other states about this process.
    The key is that we select an approach which will enable all 
the Clerks of the Court to continue providing customer service 
to their constituents by affording them on-line access to the 
state computer system, ATLAS. Using ATLAS, the clerks will be 
able to determine the payment status on their cases at any time 
and to print pay histories as needed for court proceedings.
    I think that you can appreciate the many benefits that we 
in Arizona have reaped by having a forum for cooperative 
decision making. We think it ultimately results in a better 
system through which our children can be served.
    Thank you for the opportunity to address the committee.
    [The prepared statement follows:]
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    Mr. Hayworth. We will now pass the radio microphone and the 
public-address system to our friend Nancy Mendoza. We would be 
very happy, Nancy, to have your testimony now, please.

  STATEMENT OF NANCY MENDOZA, ASSISTANT DIRECTOR, DIVISION OF 
   CHILD SUPPORT ENFORCEMENT, ARIZONA DEPARTMENT OF ECONOMIC 
                            SECURITY

    Ms. Mendoza. Good morning, Mr. Chairman, Congressman 
Hayworth. My name is Nancy Mendoza. I am Assistant Director for 
the Department of Economic Security, and in the capacity, serve 
as the director of child-support enforcement.
    I would like to express my appreciation to the subcommittee 
for the recognition you have given to the role that child-
support enforcement plays in welfare reform. By including the 
many significant enhancements to the child-support program in 
the Welfare Reform Act, you sent a strong message that personal 
responsibility applies not only to welfare recipients but also 
to the noncustodial parents of their children.
    In Arizona, we have come to realize that even when welfare 
participants comply with all requirements in obtaining 
employment, the income from one salary may not be sufficient to 
meet the family's needs. Indeed, many families today depend 
upon two incomes. A reliable income stream from the 
noncustodial parent may mean the difference between welfare 
dependency and self-sufficiency.
    I would like to describe how the child-support program is 
configured in Arizona. As you will note on attachment A tomy 
statement, several different entities are involved. The elected county 
attorney operates the program in six counties. The DES division of 
child-support enforcement operates the program in seven counties. In 
two counties, the program is operated by a private vendor under 
contract to DES.
    In the area which comprises the Navajo Reservation, the 
Navajo Tribe will be operating the program through an 
intergovernmental agreement with DES. This important milestone 
was reached last November at a signing ceremony in Window Rock.
    An office in Chinle, Arizona will be opening later this 
summer. We also have an agreement with the Colorado River 
Indian Tribe in which the La Paz County Attorney is authorized 
to bring actions in Tribal Court. Discussions with several 
other tribes have been held, including the Haulapai, Hopi, and 
the Salt River Pima.
    We have been assisted in making progress in the delivery of 
service to tribal members by the provisions you enacted both in 
August of '96, by establishing the authority for state/tribal 
cooperative agreements, and--the additional clarification 
regarding the scope of such agreements which you passed last 
year.
    The Arizona Child Support Enforcement Program has made 
significant improvements in recent years. Arizona was ranked 
first in the nation by the U.S. Department of Health and Human 
Services for increased collections between 1992 and '96.
    Just last month, the White House announced that between 
1992 and '97, national child-support collections increased 
sixty-eight percent. Arizona's collections during that time 
increased by one hundred eighty-four percent.
    Also announced by the White House was the national increase 
in paternity establishment between '92 and '97 of a hundred 
fifteen percent. Arizona's paternity establishment increase was 
two hundred forty-two percent for the same time period.
    With regard to federal automation requirements, although 
most states were unable to meet the federal deadline of October 
'97 to have their systems operational, Arizona achieved federal 
certification of our automated system in July of 1996.
    While we are understandably proud of these accomplishments, 
we recognize that many children still lack the financial 
support to which they are entitled. We continue to work 
aggressively on behalf of those children.
    I would like to mention our progress in the implementation 
of welfare reform changes. With the support of the Governor's 
office and the State Legislature, Arizona has enacted all of 
the changes to state law required by welfare reform as well as 
other acts that we passed last summer.
    The vast majority of these changes will be implemented over 
the next few months, including the centralization of payment 
processing for all child-support cases, establishment of the 
mandatory new-hire reporting requirement for all employers in 
Arizona, the establishment of a state case registry containing 
both IV-D and non-IV-D orders, the issuance of income 
withholding orders automatically upon receipt of information 
from the new-hire directory.
    These are just a few of the major changes underway to 
comply with the new requirements. I would encourage the 
Subcommittee to recognize the magnitude of these reforms and 
the challenges they create for the state child programs across 
the country. I hope that you can defer making additional 
changes to the program to allow time for these new initiatives 
to be implemented and their impact evaluated.
    At your May oversight hearing, you heard from several 
witnesses regarding the role of the private sector in the 
child-support program. In Arizona, we have entered into several 
public/private partnerships.
    In 1994, we engaged the services of private collection 
agencies to assist in our more difficult cases. We refer these 
cases to the vendor automatically through our overnight batch 
processing.
    The partnerships of the private sector make the skills and 
capacities available to the child-support program. At the same 
time, the requirements for data security and privacy are 
maintained because they are operating under contract to the 
states.
    While Arizona aggressively pursues the payment of support, 
we also recognize that nonpayment is not always willful. The 
root cause of nonpayment may stem from the noncustodial parent 
being unemployed or underemployed. We have recently expanded 
our services to noncustodial parents by working with several 
community agencies to provide job training and job placement 
through a referral from the child-support program.
    Thank you for the opportunity to address the committee.
    [The prepared statement follows:]
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    Mr. Hayworth. Thank you, very much, Nancy, for your 
testimony.
    And now, we can turn the radio mike just a little bit and 
we can hear from Nona Etsitty. Nona, thank you for joining us. 
And you might want to pull the public address mike a little 
closer to you--the other microphone too. That is great.

   STATEMENT OF NONA ETSITTY, TRIBAL ADVOCATE, NAVAJO NATION 
          DEPARTMENT OF JUSTICE, WINDOW ROCK, ARIZONA

    Ms. Etsitty. Before I begin, I think it is appropriate for 
me to introduce myself. My mom is a Cherokee from Oklahoma. My 
father was a Navajo, so that means I am a Cherokee born for the 
Navajos. I have lived all my life on the Navajo reservation, so 
I am very much a part of the Navajos.
    To begin with, the Child Support Enforcement Program came 
about because the Office of Navajo Women saw a need for the 
Navajo Nation to take forth legislation to the state of New 
Mexico.
    Prior to the enactment of the Navajo Child Support 
Enforcement Act, the Navajo Nation had no means to collect 
support by the Navajo Nation. There were no general laws for 
paternity or adult responsibility for the care and support of 
the children.
    Navajo children living on the Navajo Nation did not enjoy 
the same benefits and protections provided by laws to children 
living off the Navajo Nation. So the Navajo Nation--on December 
14th of 1994, Navajo Nation Council passed the Navajo Nation 
Child Support Enforcement Act. July 25th 1996, the Judicial 
Committee of the Navajo Nation Council passed the Navajo Nation 
Child Support Guidelines.These two legislations on the Navajo 
Nation gave the Navajo Nation tools to work with by the enactment of 
these laws.
    Prior to 1994, the state of New Mexico and probably most 
states surrounding the Navajo Nation had virtually no 
collections for child-support enforcement in the Navajo Nation. 
After the signing of the agreement with the Navajo Nation and 
the state of New Mexico, we have been in existence four years.
    I would like to focus on the problems that we have with 
funding, because funding is a major part of our existence. We 
are funded completely by the state funding. We don't have any 
of our own tribal funds that are allocated to fund child-
support enforcement. So the states--having our 
intergovernmental agreement with the state is vital for us in 
the way of our funding.
    What is happening in New Mexico, we were awarded $150,000 
through the New Mexico Human Services budget. On the other 
hand, Senator Pinto, State Congressman (sic), approached the 
State Legislature for an additional hundred and fifty to 
increase our budget to $300,000. Federal matching would have 
brought our budget up to $884,000 to work with. That would have 
have been an increase to the Navajo Nation.
    Now, statistically, in 1995, our collections in New Mexico 
were $3,500, and we are very new and beginning. In 1996, our 
collections went to 110,000. In 1997, our collections were 
294,000. This year, 1998, we project 400,000 plus. So it is 
kind of hard for us to understand why we are not given the 
opportunity to increase our budget in the state of New Mexico.
    While in Arizona, we have a different scenario. In New 
Mexico, when we got the funding of $144,000, that was to handle 
1,500 cases that were transferred from the Farmington office. 
In Arizona, we have a budget of $375,000 to handle 12,000 
cases, and I feel like this funding is very much unfair and 
will allow us to do an adequate job but by a miracle will allow 
us to get by.
    So in the future, we would like to have the states at least 
look at increasing that funding as we start our Arizona 
project, because it is fairly new.
    Another problem that we have are infrastructures. As was 
mentioned about roads and buildings, we don't have adequate 
infrastructures to house the offices of Child Support 
Enforcement. If the budget is passed in New Mexico, that means 
that we would be housing close to nine maybe eight more child-
support enforcement officers, and so we have outgrown the 
building there. With Arizona, we plan to grow as well, and 
infrastructures and building is a necessity. We don't have 
those available to us now.
    Computerization, it is very important for us to have the 
technology and assistance from the state, but like it was 
mentioned before, we have three regions. Arizona is governed by 
San Francisco, New Mexico is Dallas, and--there is another 
one--Utah. So we are kind of, like, stretched apart again in 
child-support enforcement.
    We have a system that we are using in New Mexico called 
CHEERS, and then we are having another automated system in 
Arizona that is not--that is different from CHEERS. So 
computerization and having one system would be important for 
us. Child-support incentives of the 400,000 that we collect in 
New Mexico, we don't get any. The state gets all of it.
    And in closing, the Navajo Nation would recommend that--we 
know that regulation being--are in the making. Direct funding 
with no matching funds would be a recommendation from the 
Navajo Nation. Taking into account infrastructures that we 
don't have, that would be another account. The technical 
assistance and equipment should also be considered in 
allocations when it is given.
    The Navajo Nation has been with its child-support 
enforcement program--it has been in existence four years, and I 
believe that we are ready to take the step to do our own child-
support-enforcement program. Hopefully, this would do nothing 
to take away from our intergovernmental agreements because we 
still need the help of Arizona, and we still need the help of 
New Mexico. So with that in mind, we would ask that you take 
these things into consideration.
    [The prepared statement follows:]
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    Mr. Hayworth. Nona, we thank you, very much. And we 
appreciate also your acknowledgment of your unique background 
as Oklahoma Cherokee as well as Navajo. And since the Chairman 
of the committee has a bit of Cherokee in him--I guess Carolina 
Cherokee--we appreciate that. I guess a little meeting of the 
minds and similar cultures here.
    With that in mind, we will turn now to our friend Steven 
Esposito, the Systems and Automation Administrator from the 
Arizona Department of Economic Security.
    And once again, we transfer the microphones over and want 
to make sure they are right in front of you, Steve, because we 
very much want to hear what you have to say.

  STATEMENT OF STEVEN J. ESPOSITO, ADMINISTRATOR, DIVISION OF 
  CHILD SUPPORT SYSTEMS AND AUTOMATION, ARIZONA DEPARTMENT OF 
                       ECONOMIC SECURITY

    Mr. Esposito. Thank you. I am Steven Esposito. I am the 
Systems and Automated Administrator for the Division of Child 
Support Enforcement. Since 1991, I have been responsible for 
implementing, enhancing, and maintaining ATLAS, Arizona's 
statewide automated system.
    We are aware that Congress is focusing on the financial 
penalties being assessed against states that fail to meet the 
required automation deadline. As Nancy mentioned in her 
testimony, Arizona is not subject to these penalties because we 
achieved federal certification before the deadline. We believe 
our success was due to certain principles and strategies that 
can be used in other states.
    Our experience has shown that a single, statewide system 
for the processing of child-support payments was an extremely 
sound concept. Children benefit from increased financial 
support. Custodial parents benefit from timely and uniform 
processing of their cases. Noncustodial parents benefit from 
accurate accounting of payments. Taxpayers benefit by limiting 
the need for public assistance. Arizona and the federal 
government benefit from cost-effective use of limited technical 
resources.
    For any project of this size to be successful, there must 
be full involvement from all stakeholders. Federal guidance 
must be clear and consistent. State leadership must be strong. 
County partnerships must be amicable and focused on the people 
that we serve. And finally, the vendor relationship must be one 
of mutual trust and respect. Arizona was fortunate and 
persistent enough to be successful on all fronts.
    The federal staff assigned to Arizona were true partners in 
the development of the project and were invested in the quality 
and success of our work.
    The General Accounting Office recently published a study 
that was critical of federal leadership and control of 
automation projects. Arizona's experience bore little 
resemblance to the findings in the GAO report.
    Support for initiatives of this size must come from top 
state officials. Child-support-automation projects are 
difficult and sometimes politically charged. There was strong 
support for the implementation of ATLAS from the governor's 
office, the State Legislature, the director's office, and the 
DES executive management.
    For a single automated system to succeed, we needed a solid 
partnership with our political subdivisions. In Arizona, we 
forged a strong alliance with our court clerks and county 
attorney officials. We attribute much of the success and the 
quality of the implementation to the contributions of these 
partners.
    The relationship between the state and its implementation 
vendor is critical. Arizona was fortunate to have a talented 
and dedicated vendor team, coupled with an equally talented and 
dedicated state staff.
    We believe that states that were successful in implementing 
certified systems are especially well positioned to implement 
the provision of welfare reform. Arizona has already 
implemented some of the early enhancement and found that we 
have a solid foundation upon which to build.
    Our success in implementing ATLAS has established a very 
favorable reputation for our ability to manage and implement 
complex change on time and within budget. Welfare reform has 
given much more responsibility to the IV-D program.
    All child-support payments, both IV-D and non-IV-D, will be 
processed by ATLAS. All support orders will be loaded into a 
state case registry within ATLAS. Many new mandated data 
exchanges will be automated in the next two years. I believe 
DES has earned the confidence of the Legislature, county 
leadership, and federal government that we will be equally 
successful in implementing welfare reform.
    I have participated in two major phases of the 
implementation of federal child-support legislation. Based on 
this experience, I have identified six areas that make 
implementation difficult from the automation perspective: 
First, federal delays in publishing final regulation and 
policy; second, limited private sector knowledge of child 
support; third, the reasonableness of the time lines imposed by 
legislation; fourth, the lack of alignment between new 
legislation and other existing federal legislation; fifth, the 
size and political composition of the state; and sixth, the 
competition for top technical staff with Year 2000 projects.
    Arizona is pleased to be among the nation's leaders in 
implementing child-support and welfare-reform-automation 
initiatives mandated by Congress. We have found the effort to 
be great but the reward to be greater.
    Child-support agencies have been given unprecedented 
authority and access to information to aggressively enforce the 
payment of child support. Automation has contributed to the 
most significant improvement in the enforcement of child 
support the nation has ever seen.
    Those of us responsible for our state's automation project 
look forward to the challenge of welfare reform and are proud 
of our role in improving the lives of our nation's children and 
families. Thank you.
    [The prepared statement follows:]
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    Mr. Hayworth. Steve, we thank you for the testimony, and I 
just wanted to return to, as you very succinctly outlined, some 
of the challenges that a lot of different folks are facing.
    Even as Arizona has success in implementing ATLAS, I just 
wanted to return and revisit, briefly, the success story here 
in Arizona. You mentioned a lot of different factors coming 
together. But could you isolate for us the key factors that led 
to the success? What would that be? And what lessons could 
other states draw from the Arizona experience?
    Mr. Esposito. Well, first of all, I would like to mention 
that Arizona has a proven track record and methodology--a 
structured methodology for project control and project 
management. But if I were to pick out a key factor, it was the 
partnership that we developed with our counties.
    The people who do child support are passionate about their 
business. They have knowledge about it. They have opinions 
about the best way to do their jobs. We found that no one 
person knows how to run child support.
    What we did was we put together, fundamentally, a board of 
directors that had members of the counties on them. That board 
of directors was key to our ability to communicate, to get 
input, and to build a quality system that met everybody's needs 
but balance the needs versus the wants and the scope of the 
project and the budget of the project with what wastechnically 
feasible and just plan old how many cases we benefitted by the things 
we were automating.
    The cost and the constant communication could not have been 
done without it. Without the collaboration, without the 
commitment, a successful implementation would have been 
compromised.
    Mr. Hayworth. One of the unique things about Arizona is we 
take a look at political subdivisions. I think about the six 
congressional districts and square mileage about the size of 
the commonwealth of Pennsylvania. I also look at the fact that 
in Arizona, comparatively speaking, we have very few counties 
as opposed to many of our eastern neighbors with counties 
numbering over a hundred.
    Was that the unique blessing as well in terms of that 
county coordination--having fewer counties and perhaps fewer 
people with which to deal in the mix?
    Mr. Esposito. There is no doubt that some of the larger 
states that are set up differently, that have more counties, 
that have counties with extremely powerful county seats and 
elected officials make the implementation much more 
problematic.
    My opinion, though, is still that if you bring those people 
beforehand, if you get their consensus, if you share 
information with them, a number of the obstacles can be 
overcome. Notwithstanding all the other technical and political 
realities, I still think a statewide system is the way to go.
    Mr. Hayworth. Thanks. Let me turn to Nona, again, because 
we hear echoes of President Atcitty's testimony in your 
testimony, Ms. Etsitty, in terms of the challenges we talked 
about, the county situation and the state implementation of 
ATLAS, the success rate that we have here in near Arizona.
    Your challenges, again, seem to be compounded by the 
fractured nature of supervision and administration, and again, 
just as part of the record, even as you are dealing with--you 
talked about the contrast between Arizona and New Mexico.
    In your mind, to solve the problem, again, is a direct 
grant called for, or do we need to continue this shoulder-to-
shoulder partnership, if you will, with the respective states?
    Ms. Etsitty. Given the experience that we have in the past 
four years, direct funding would--we are ready for it. We would 
be ready for one system that we can all use within the Navajo 
Nation.
    Right now, like you say, we use ATLAS in Arizona. We use 
CHEERS in New Mexico. And probably if we were to enter an 
agreement with Utah, we would use another one. It makes our 
work diverse among the states that we work in.
    Mr. Hayworth. And again, just to revisit your success rate, 
I want to make sure I understood the figures exactly; from 
initial accumulation of some, what, very modest, only $3,000 to 
now projected in excess of $400,000 in terms of child-support 
collections.
    Ms. Etsitty. That is right. Since 1994 up to 1998, we have 
increased collections: $3,500 in 1995 to a projected 400,000 
this year, from the time we started.
    Mr. Hayworth. Nona, if you could, pass the radio mike to 
Nancy. I think she still has the PA mike right there.
    Nancy, you offer a cautionary note in the midst of your 
upbeat testimony. I heard that caution about hold on a second; 
be careful in drafting of further rules and regulations. Let's 
revisit that and amplify that from your perspective.
    Ms. Mendoza. Chairman Shaw, Congressman Hayworth, I hope 
that I was not perceived as disrespectful in that comment.
    You have given us extreme amounts of new opportunities 
through the welfare legislation, all the way from payment 
processing to these national registries to the financial 
institution data matches that we will be doing with financial 
institutions.
    All of those changes have automation implications and 
training implications for our staff. And so we would like an 
opportunity to implement all of those innovations and see what 
impact they have on our program before we add more new, good 
things.
    We certainly welcome and were appreciative of all the new 
authority that we received. We would like an opportunity to be 
successful with that before we take on any new ventures.
    Mr. Hayworth. To draw a historical analogy, Nancy, my 
profession of broadcasting, I recall the history of the Federal 
Communications Commission before it tried. Now, it appears Mr. 
Chairman the FCC wants to get in the business of taxation. But 
back in the early 1950s, there was a freeze put on the number 
of licenses granted for television stations. Are you 
suggesting, in essence, a regulatory freeze to evaluate?
    Ms. Mendoza. Chairman Shaw, Congressman Hayworth, no, there 
are always more and better ways to do child-support 
enforcement, and a lot of great ideas can come forward; but 
there is a critical mass that is reached in any kind of 
innovation where more change may not be effectively 
implemented.
    And I certainly don't mean to say that the bill that you 
are currently considering, HR 3130 that is before the 
conference, I am not in any way wanting to dissuade you from 
the completion of that important work, which sets forth the new 
incentive formula for the programs. As a matter of fact, I hope 
that the conferees will adopt the measures related to the 
streamlining of medical-support enforcement and financial data 
matches at the national level.
    But what I am thinking about are things that might have any 
additional automation implications or that would perhaps in any 
way reverse course in anything that we are just getting up and 
running at this time.
    Chairman Shaw. I think what she said is if it is not broke, 
don't fix it.
    Mr. Hayworth. That is a good policy. Thank you, Mr. 
Chairman, for the translation. It is good to know that our 
friends from Florida can cut through in much the same way our 
Arizonans have the ability to cut through a maze.
    Let me move the mike down to my friend Freddy, or 
Representative Hershberger, to maintain the formality of our 
gathering here today.
    Again, to note to all our panelists, your entire statements 
will be included in the record.
    And again, Representative Hershberger, we want to 
congratulate you on the work for which you have been recognized 
as the legislator of the year with regard to child support.
    A comment in your statement that I would like you to 
amplify a little bit; we are taking a look at strengthening the 
ties between fathers and families. I think we are all drawn to 
the pictures and the stories of families that appear very 
prominently in local newspapers where the question manyof my 
constituents have as they look at the picture of a mom struggling with 
several children, where is the father?
    And we have heard about the strides made in establishing 
paternity. We have introduced a bill in Washington, HR 3314, 
that seeks to support such efforts by providing two billion 
dollars in new federal funds for states to support private, 
including faith-based groups, to run programs to help promote 
the importance of fatherhood.
    Could you tell me more about the campaign here in Arizona 
and what has been working here in our backyard in that regard?
    Ms. Hershberger. Congressman Hayworth, Mr. Chairman, 
perhaps we should refer back to the bill that came out of the 
child-support council last year, which was the education of 
parents who are in divorce as to how to handle their children. 
And that, indeed, has been very effective, we think, so far.
    The first year's reports have been excellent. It has 
brought the fathers into the picture, because both parents 
realize that the children need two parents. It has given the 
noncustodial parent the opportunity to participate in his 
child's life through support, perhaps, but it has also really 
provided an avenue, and I think that is working very well.
    Perhaps you referred to the covenant marriage, and I think 
you should talk to my friend Dave Petersen about that since I 
was not an avid supporter of that bill. I believe I entered 
into a covenant 52 years ago, and my church called it a 
covenant, and I don't think we need state legislation, either, 
to go along those lines. I think that is up to faith-based 
organizations, and I think most of them do do that kind of 
thing.
    So I think we are making headway. And through the paternity 
establishment as well for these children who are being brought 
up by a single mom, that is helping to identify somebody else 
is responsible and to bring them into the picture.
    Mr. Hayworth. Mr. Chairman.
    Chairman Shaw. I think, to follow up on what Congressman 
Hayworth is talking about, we have a huge problem, which 
everyone in this room knows about, and that is the tremendous 
number of kids that are being born out of wedlock.
    One thing we found out in welfare reform was that one of 
the big problems that we had was that people--and one of our 
witnesses was talking about earlier, we are creaming the system 
now; we are getting the easier cases out of the way. And even 
though we have had great success in putting people back to 
work, we know full well it is going to get tougher when we get 
down towards the bottom.
    That is one of the reasons why Congressman Hayworth and I 
are steadfastly opposing any attempt to cut TANF funding, 
despite the fact that those caseloads are coming down, because 
the states are going to have to spend more money per client in 
order to start with training: teach somebody the simple things 
that most of us were raised knowing how to do: how to shake 
hands, how to show up on time, how to follow directions, how to 
do a job.
    And we found that there were so many people that were born 
in a house and even in a neighborhood where nobody was working. 
They had no model. They had nothing to relate to. So you have 
got to start with the very basics.
    We found the same thing is happening with regard to young 
boys growing up without fathers. They don't have a clue of what 
it is like to be a father. I mean, they know what brings babies 
into the world, but after that, they think that is the end of 
it, and it is very important that on we go, just like we did in 
welfare reform, and go in and attack the root of that problem 
and try to train these young men to accept the responsibility 
of being a father, not only the financial responsibility but 
the spiritual and the whole wonderful life of being a father 
and what all that involves, including giving some of their 
time.
    And I think we have looked at some of the programs around 
the country, and they have been very successful, and we feel 
that this is important. That is the bill Congressman Hayworth 
is referring to. It is one that is also before our 
subcommittee, which I believe you cosponsored.
    Mr. Hayworth. That is correct. Yes, sir.
    Chairman Shaw. We have cosponsored that together, and we 
are going to try to work that through; and if we are 
successful, we will be coming back to you as the state 
legislator. Maybe we can make you the legislator of the year 
for fatherhood or something. And hopefully, you will take the 
lead on that, because it is a very good program, and it is 
something we desperately need to address.
    I want to go back to Nona and talk to her just a moment, if 
I could. If you could, pass that microphone back, please.
    I want to know a little bit more about child-support 
enforcement among Native Americans. Is out-of-wedlock births as 
big a problem among Native Americans as it is the rest of the 
American population?
    Ms. Etsitty. It is. We have the same problem.
    Chairman Shaw. Now, when you get into child-support 
enforcement and you get into the reporting requirements, the 
law that we have in place provide for the registry. I think 
Steve was talking about how that works. And I think Nancy was 
talking about keeping those records, not to go change the way 
the thing is working, and we have no intention of doing that.
    Now, the Native American or the figures that you gather, 
then, would go--as I understand it, into the state's data 
system. Isn't that correct?
    Ms. Etsitty. It will.
    Chairman Shaw. So that in trying to track the fathers--
generally, it is the fathers for child support--we can track 
them across state lines.
    Ms. Etsitty. Right.
    Chairman Shaw. And I think that is tremendously important. 
Do the Native Americans have the same--use the same courts as 
the rest of us do, or is it a special court that is set up 
within the Indian Nation?
    Ms. Etsitty. It is an administrative process that Navajo 
Nation courts in the seven districts agreed that they didn't 
want to handle the child-support enforcement area, and so an 
administrative process, which is very simple, quick, fast, and 
it allows us the tools to make collections easier just as the 
state. So it is----
    Chairman Shaw. What court? Does the same administrative 
body make the orders as to what payments are to be made for 
child support?
    Ms. Etsitty. No.
    Chairman Shaw. Or does that go into the Arizona or New 
Mexico court system?
    Ms. Etsitty. No. It is our own system. What it is is we 
have the court system over here, our seven judicial. And then 
we have the Court of Appeals, and then we have a lot 
ofadministrative--like, we have the Navajo Nation Labor Commission. We 
have our grievances for our--the people who need--who are fired from 
the government. They take the grievances to a hearing body, and it is 
called the Office of Hearings and Appeals. They are the ones that do 
the cases for us.
    Once an administrative order is entered, the next remedy 
for the person to appeal would be our Navajo Nation Supreme 
Court. So it is a whole separate administrative body.
    Chairman Shaw. So a man and a woman who want to be 
divorced, they go before this administrative body, and if----
    Ms. Etsitty. No.
    Chairman Shaw. Well, where do they go?
    Ms. Etsitty. Okay. They would go to the district court. 
This----
    Chairman Shaw. The court that everyone else goes to?
    Ms. Etsitty. Right.
    Chairman Shaw. So that the child-support order, then, comes 
out of that court.
    Ms. Etsitty. Right.
    Chairman Shaw. Then how would that make it into your 
system?
    Ms. Etsitty. Once an order is entered into our court, we 
take the order, and we have the child-support enforcement 
program.
    Chairman Shaw. Uh-huh.
    Ms. Etsitty. The mother gives us--well, say the father is 
delinquent. The mother gives us her public assignment to go 
after the father. And say dad works maybe in the president's 
office. Let's pick on Mr. Atcitty.
    Chairman Shaw. That is a good place to start.
    Ms. Etsitty. Our child-support enforcement program would 
initiate what we call a very simple Notice of Public Assign--
Notice of--what is it? NPA--Notice of Public Assignment.
    And when the father receives that, then he either, through 
our administrative process, will answer; or if he doesn't 
answer, we will end up defaulting him, and then we will go use 
tools that are there available to do withholdings or anything 
we can to execute on the child-support enforcement order.
    Chairman Shaw. Now, what happens when he crosses state 
lines or somebody comes from another state into your 
jurisdiction? How do you work that?
    Ms. Etsitty. Okay. With the agreements that we have--let's 
say Flagstaff is close to home but it is not on the Nation. Say 
the mother lives on the Nation and the father works in 
Flagstaff. What happens is we would take that court order that 
is entered, and we would ask the State of Arizona to enforce it 
for us, and they would take it as a UFRISA [sic] Package, send 
it up to Flagstaff, and enforce it there. And the collections--
--
    Chairman Shaw. That would be the state.
    Ms. Etsitty. Right. The collections go to Arizona, and then 
they send it to the mom.
    Chairman Shaw. And that is the same if they take off to 
Florida, New York, or wherever.
    Ms. Etsitty. Right, uh-huh. But when it comes into the 
Navajo Nation, we domesticate their orders. We don't change 
anything. We don't do anything with the order. We just 
domesticate it and enforce it with the tools that we have.
    Chairman Shaw. Do you have anything else?
    Mr. Hayworth. No, sir.
    Chairman Shaw. I want to thank this panel, as well as all 
the witnesses that we have had. We certainly learned a lot. I 
can say I certainly have, as Chairman of the committee; and 
look forward to going back to Washington.
    Unfortunately, I didn't plan this trip very well. I flew in 
last night and have to fly out about 1:30 today. So I think 
J.D. thinks I am a little nuts for not trying to stay over the 
weekend. I wish my time was where I could.
    But I certainly think this has been tremendously worthwhile 
for me. And J.D., I want to thank you for bringing the 
committee out here. We came out with both Democratic and 
Republican staff persons so that the hearing will be reported 
in a very balanced way.
    And these are areas where I might say the Republicans and 
Democrats have come together, and we are working closely 
together, particularly in this area of child support. We have 
had wonderful bipartisan support in this whole area, and I can 
assure you that we are going to do everything we can to get 
this rule making pushed forward as quickly as possible and with 
the participation and input of the Native Americans, who are 
most intimately involved in having to enforce it.
    And again, if I may call you Freddy, it is a great honor to 
be with you as the legislator of the year.
    And Nancy, it is great to see you back here on your home 
turf and away from Washington. I think, as J.D. said, Nancy has 
testified before us in Washington, and we always learn a great 
deal.
    And thank you for--all of you who have taken time out of 
your day to join us here today on something that is a most 
important subject, because here we are dealing with kids, and 
we are dealing with the future of this country.
    J.D., do you have anything you would like to say before we 
close?
    Mr. Hayworth. Mr. Chairman, my wife Mary always reminds me 
there is a lot to be said for brevity--think about that--and I 
will try to follow her advice in this rare instance, Mr. 
Chairman.
    Again, simply to thank you and our staff members for 
bringing this hearing outside the belt way, and then some, to 
Arizona, to understand what has worked, where the challenges 
remain, and certainly the special relationship and the treaty 
and trust obligations confronting Native Americans.
    I look forward to working with you as we deal aggressively 
with trying to address some of the problems that transcend 
state lines and on the boundaries of the sovereign Navajo 
Nation and many other of our tribes here in Arizona and, 
thereby, across the country.
    And so thanks to the witnesses, thanks to those who have 
joined us here in this hearing, and we will continue to work on 
this. And most of all, thanks to you, Mr. Chairman, for joining 
us here in Arizona today.
    Chairman Shaw. Thank you. The hearing is concluded.
    [Whereupon, at 12 noon, the hearing was adjourned.]

                                
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