[Congressional Record Volume 142, Number 106 (Thursday, July 18, 1996)]
[House]
[Pages H7796-H7907]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                WELFARE AND MEDICAID REFORM ACT OF 1996

  The SPEAKER pro tempore [Mr. Kolbe]. Pursuant to House Resolution 482 
and rule XXIII, the Chair declares the House in the Committee of the 
Whole House on the State of the Union for the further consideration of 
the bill, H.R. 3734.

                              {time}  1047


                     in the committee of the whole

  Accordingly the House resolved itself into the Committee of the Whole 
House on the State of the Union for the further consideration of the 
bill (H.R. 3734) to provide for reconciliation pursuant to section 
201(a)(1) of the concurrent resolution on the budget for fiscal year 
1997, with Ms. Greene of Utah in the chair.
  The Clerk read the title of the bill.


                             point of order

  Mr. ORTON. Madam Chairman, I rise to make a point of order against 
consideration of H.R. 3724.
  The CHAIRMAN. The gentleman will state his point of order.
  Mr. ORTON. Madam Chairman, section 425 of the Congressional Budget 
Act prohibits us from considering legislation which would create an 
unfunded mandate upon the States. The Congressional Budget Office has 
ruled that H.R. 3734 falls $12.9 billion short in funding necessary to 
fund the work requirements of the bill. Also the National Governors 
Association has stated: We are concerned that the bill restricts State 
flexibility and will create additional unfunded costs.
  This bill clearly creates an unfunded mandate, violates section 425 
of the Congressional Budget Act, and I would further point out that 
section 426 of the Congressional Budget Act prohibits this House from 
considering a rule which would waive section 425. So that in any event 
we would have a vote and a determination as to whether or not a bill 
does in fact create an unfunded mandate.
  The CHAIRMAN. The Chair would respond to the gentleman's point of 
order as follows. Points of order against consideration of the bill 
H.R. 3734 were waived by unanimous consent on July 17, 1996. Further, a 
point of order against consideration of House Resolution 482 would not 
be timely after adoption of that resolution.
  The gentleman's points are not in order.
  Mr. ORTON. I thank the Chairman. I think it is clear to the House and 
the country that in fact we are violating the first bill we passed in 
this Congress with the adoption of this bill.
  The CHAIRMAN. When the Committee of the Whole rose on Wednesday, July 
17, 1996, all time for general debate pursuant to the previous order of 
the House had expired.
  Pursuant to House Resolution 482, there will be 2 additional hours of 
general debate. The gentleman from Ohio [Mr. Kasich] and the gentleman 
from Minnesota [Mr. Sabo] will each control 1 hour.
  Mr. SABO. Madam Chairman, I ask unanimous consent that the gentleman 
from Texas [Mr. Archer] be allowed to control the time for the 
gentleman from Ohio [Mr. Kasich] temporarily and be allowed to yield 
time.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
Minnesota?
  There was no objection.
  The CHAIRMAN. The Chair recognizes the gentleman from Texas [Mr. 
Archer].
  Mr. ARCHER. Madam Chairman, I yield myself such time as I may 
consume.
  Madam Chairman, since 1965, roughly 30 years ago, government in this 
country has spent $5.5 trillion on welfare programs, more than has been 
spent on all of the wars fought in this century. Yet people are poorer 
and more dependent than ever. Despite our best efforts, despite the 
expenditure of these massive amounts of money, we have lost the war on 
poverty.
  Madam Chairman, today, we stand on the threshold of a new effort, an 
effort that can win the war.
  With the vote we take today, we recognize that the Great Society's 
welfare programs have not helped people. They have destroyed people. 
They have not kept families together. They have torn them apart.
  These policies haven't turned urban areas of America into shining 
cities on a hill. They have made them into war zones where law-abiding 
citizens are afraid to go out at night.
  They have led to the creation of two Americas. One marked by hope and 
opportunity. The other by despair and decay.
  In short, the welfare state has created a world in which children 
have no dreams for tomorrow and parents have abandoned their hopes for 
today.
  The people trapped in welfare, the mothers, the children, the 
fathers, are our fellow citizens, one and all. We have a moral 
obligation to them, as Americans, to lend a helping hand.
  For the people on welfare aren't abusing welfare, as much as welfare 
is abusing them.
  We are on the threshold of improving America by fixing our failed 
welfare state. We're improving America for the children on welfare, for 
the parents on welfare, and for ourselves.
  Our reforms are based on five pillars. The pillars represent the 
values that made America great.
  One--we think people on welfare should work for their benefits. A 
welfare worker I spoke with told me the biggest beneficiaries of work 
aren't the moms or the dads. Yes, they benefit. But she said it's the 
children who watch their parents get up each morning, go to a job, and 
return home at night who are the big winners. These children get better 
grades in school, have fewer problems with crime, and are less likely 
to end up on welfare because the values and virtues of work, not 
idleness, are instilled in them at a young age.
  Two--Time limit benefits. Welfare should be a temporary helping hand, 
not a way of life.

[[Page H7797]]

  Three--Provide no welfare for felons and noncitizens. America always 
has been and always will be the land of opportunity for immigrants. But 
it's not right to ask hardworking, taxpaying Americans to support 
noncitizens who come here and then go on welfare.
  Four--Return power and control of welfare to the states and 
communities where help can best be delivered. We must remove 
Washington's control over welfare. This city built the failed welfare 
state. It's time to get Washington out of the welfare business.
  Five--Reward personal responsibility and fight illegitimacy. We 
shouldn't have a welfare system that promotes illegitimacy and 
discourages marriage. It's time to change signals and return to old-
fashioned values.
  Madam Chairman, today's vote will be historic.
  It represents the biggest, most helpful change to social policy in 
America since the 1930s.
  This vote recognizes that America is a caring country, that Americans 
are a giving people, and that welfare recipients are capable of success 
if we would only let them try.
  Our colleague, J.C. Watts, has a wonderful way of expressing it. He 
says America's welfare recipients are eagles waiting to soar.
  Madam Chairman, I think it's time we removed the heavy hand of the 
Federal Government from their wings. We must let our fellow citizens on 
welfare reach new heights as they climb the economic ladder of life.
  That's what this bill does. It helps people to help themselves. It 
restores hope and it provides opportunity. It's strong welfare reform 
and it's what the American people have wanted for years.
  Madam Chairman, there is no good reason why this bill should not be 
passed by the Congress and signed into law. The American people expect 
nothing less, and families on welfare deserve much, much more than the 
sad status quo.
  For the sake of all Americans, I hope the President will let this 
bill become law.
  Madam Chairman, I reserve the balance of my time.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the gentleman from 
California [Mr. Matsui].
  Mr. MATSUI. Madam Chairman, yesterday we heard the chairman of the 
Budget Committee say that this debate was really about Judeo-Christian 
ethics. That is why I was somewhat disappointed last night when I read 
Congress Daily. In the Congress Daily we talked about welfare reform 
and we talked about what this debate was really all about. The chairman 
of the subcommittee that has jurisdiction over welfare was quoted as 
stating from a political point of view, the President of the United 
States is in a box.
  Madam Chairman, that is what this debate is all about--to jeopardize 
9 million children who will be affected by this bill just to put the 
President of the United States in a box.
  What kind of people would draft legislation for political purposes to 
affect so many children of America? This bill is weak on work and tough 
on America's children.

                              {time}  1100

  The Congressional Budget Office, their own agency, hired by the 
Republican House and Senate, has said that the 1.7 million jobs that 
the Republicans say will be created by a woman going off welfare is an 
illusion. It is deceptive, it is not going to happen, because they do 
not provide the resources for it. Their own agency has said they will 
not obtain those 1.7 million jobs. So this is not a jobs bill. This is 
not a bill to get people off of welfare into work.
  But the worst part of this bill is what it will do to children. 
Because of those time limits and because of the fact that the 
Republican bill prohibits the States from using Federal funds for 
vouchers or any kind of assistance after a woman meets those time 
limits, she will then become destitute, she will become homeless, her 
children will probably have to go into foster care, even though she 
might be a good mother.
  This is what this is all about. It is about politics to hurt 
America's children. I urge a ``no'' vote on this legislation.
  Mr. ARCHER. Madam Chairman, I yield 2\1/2\ minutes to the gentlewoman 
from Connecticut [Mrs. Johnson], the chairman of the Subcommittee on 
Oversight of the Committee on Ways and Means, the chairman of the 
Committee on Standards of Official Conduct, a person who is so greatly 
respected on our committee and has given such great service to this 
House, the country, in all of those roles.
  Mrs. JOHNSON of Connecticut. Madam Chairman, I rise in strong support 
of this bill, and I could not disagree more with the preceding speaker. 
We have to change the future. Welfare cannot be a way of life for 
either women or children. It is not a satisfactory way of life. There 
is no hope, there is no opportunity when you are on welfare.
  Now, remember, under this bill at the end of 5 years you get 
Medicaid, nutrition assistance, housing assistance, energy assistance, 
all those programs that provide services, on a means-tested basis. In 
addition, 20 percent of the whole caseload can be carried forward. So 
we are not talking about a draconian system; we are talking about 
reform and creating hope and opportunity in our welfare system for both 
the women and children on welfare.
  This bill, let me show you, will allow States, for instance, to be 
free of the rigid law that now governs income disregards.
  The woman is on welfare and starts earning money, and we right away 
start reducing benefits. Under this reform bill States will have 
complete freedom to design a fairer system. They may choose to keep her 
benefits up, and, as her salary goes up, to then decline her benefits. 
States have the power to help her get a good start in those 5 years. 
They have the power to educate and train, but to combine that with work 
experience. Under this program, women on welfare could immediately go 
to work for half a day in new day care centers, use State day care 
subsidies to give informed leadership to those centers as skilled 
master teachers. Let welfare mothers, who are good care providers, be 
the soldiers in those day care centers and then in the afternoon go on 
education and training centers while other welfare recipients staff the 
day care centers. It will cut the cost of day care and it will allow 
the money to be used powerfully in the transition period. This gives 
opportunity to States to create the kind of humane and supportive 
system women need to literally change their lives.
  In addition, the terrible decline in the cities is in part the result 
of nonpayment of rent. Part of the problem of our cities is that if a 
welfare recipient fails to pay their rent, it takes at least 6 months 
to solve the problem and sometimes much more than that. Under this new 
system, States can say you miss a month's rent? Fine, we will pay it 
directly now until you get on your feet. So we can prevent the 
degradation of our housing stock in the cities just by requiring 
personal responsibility on the part of welfare recipients and providing 
States the flexibility to create a more realistic support system, under 
the umbrella of Federal concern, compassion and support.
  Mr. SABO. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, if I might inquire of the chairman of the Committee 
on Ways and Means, we are curious if there is a final version of the 
bill and if there is a final summary of the last minute changes?
  Mr. ARCHER. Madam Chairman, will the gentleman yield?
  Mr. SABO. I yield to the gentleman from Texas.
  Mr. ARCHER. Madam Chairman, the Committee on Rules had the statutory 
language of the bill. That was made a part of the rule we voted on.
  Mr. SABO. Is there a summary of the last minute changes that were 
made?
  Mr. ARCHER. Not to my knowledge, although the gentleman is aware that 
this bill did not come out of the Committee on Ways and Means; it came 
out of his committee, the Committee on the Budget.
  Mr. SABO. Well, it has been substantially changed since it came 
through the Committee on the Budget. Many of us are curious what the 
final form of the bill is.
  Madam Chairman, I yield 2 minutes to the gentlewoman from California 
[Ms. Woolsey].
  (Ms. WOOLSEY asked and was given permission to revise and extend her 
remarks.)

[[Page H7798]]

  Ms. WOOLSEY. Madam Chairman, we all agree that welfare does not work, 
the welfare system does not work for the taxpayers, and it does not 
work for the families who are on welfare, and we all agree that the 
welfare system must be overhauled. It must be overhauled so that it 
helps recipients get jobs and stay off welfare permanently. But that is 
the easy part.
  The challenge and responsibility we face as legislators, however, is 
finding the answers to, what if's. What if a mother on welfare cannot 
find a job? What if she is not earning enough to take care of her 
family? What if her benefits are cut off and she is unable to provide 
her children with food, with clothes, and with health care?
  Madam Chairman, this bill does not even attempt to answer these, what 
if's. In fact, the majority has gone out of its way to prevent States 
from meeting the basic needs of children, children whose parents are 
unable to get a job.
  This bill says to poor children, do not get hungry, do not get sick, 
and, for Pete's sake, do not get cold, because your time is up, and we 
do not think you are important enough to provide you with the basics 
that you need to survive.
  Madam Chairman, no other Member of this body knows better than I do 
that this is the wrong way to fix welfare. As a single mother with 
three small children, working, many years ago, I could not have stayed 
in the work force if I did not have the safety net of health care, 
child care, and food that the welfare system provided for my family.
  So I urge my colleagues, do not take this vote lightly. Your vote 
today will have consequences, consequences for children long after 
election day, and it will be too late to answer the, what if's 
tomorrow.
  Mr. ARCHER. Madam Chairman, I yield 2 minutes to the gentleman from 
California [Mr. Herger], a respected member of the Committee on Ways 
and Means.
  Mr. HERGER. Madam Chairman, over the last three decades the American 
taxpayer has spent $5 trillion on our welfare system. Working Americans 
may be asking themselves, what have we gained from all that spending? 
Do we have less poverty in the United States? No; are welfare 
recipients spending less time on welfare? No; after spending $5 
trillion on welfare, have we solved the problems of poverty and 
dependency on Federal dollars? Is it extreme to think that maybe there 
is a better way of running our welfare system? Madam Chairwoman, the 
Republican welfare reform proposal will allow welfare to work better 
for all Americans. Our welfare reform makes welfare a way out--not a 
way of life. It promotes work over a continual cycle of welfare. It 
returns power and money to the States and encourages personal 
responsibility. Madam, Chairwoman, this reform proposal also denies 
welfare for noncitizens and includes a provision I developed with a 
sheriff in my district to deny imprisoned criminals welfare and create 
an incentive for local law enforcement officials to help stop this 
abuse. Currently, an estimated 5 to 10 percent of inmates in local and 
State jails are illegally receiving welfare checks. Without this 
welfare reform, the American taxpayer will allegedly give prisoners 
$270 million over the next 7 years in welfare payments.
  Madam Chairwoman, our current welfare system is inefficient, unfair, 
and damaging to those it is supposed to help. The American people 
deserve a better welfare program that is unaccepting to those abusing 
the system and compassionate to those in real need.
  I urge my colleagues to vote for this welfare reform.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from New York [Mr. Rangel].
  (Mr. RANGEL asked and was given permission to revise and extend his 
remarks.)
  Mr. RANGEL. Madam Chairman, we have gotten off the subject now of 
substantive legislation, and we are now dealing with Presidential 
politics.
  Well, let us do it. The welfare bill now has become like a tennis 
ball in a political volley, and the question is, Does it make more 
sense to force the President to keep his commitment to change welfare 
as we know it, or really do we want to get the President in the 
position that he has to veto the bill?
  Well, we have tried so many times on the Republican side to find out 
just what is it that the President hates. Obviously, it was the 
tremendous cuts that were recommended by the other side as relates to 
Medicaid. So what was the solution? Continue to make certain it was one 
package, until it becomes politically expedient to change that and to 
put another poison pill, and several other poison pills, so you can go 
home and say the President has vetoed the welfare bill once again.
  Who really suffers? It is really the voters, or it is our children? 
This obsession in saying that the Federal Government cannot take care 
of them has no responsibility to our children, but that the Governors 
should be trusted. And then to have the Christian coalition to come up 
and embrace this in a Christian way.
  Well, thank God we have the National Council of Catholic Bishops that 
say the program stinks. Thank God we have the Jewish Council Against 
Poverty that says it is no good. Thank God we have the Protestant 
Council that says it is no good. It may be good politics, but it is bad 
for the children of our Nation.
  The whole concept that we are saying 5 years, but the Governors can 
say 2: We are relinquishing our responsibility to the children of the 
United States of America, and it is a bad day in the congressional 
history.
  Mr. ARCHER. Madam Chairman, I yield 2 minutes to the very respected 
gentleman from Louisiana [Mr. McCrery], a member of the Committee on 
Ways and Means.
  Mr. McCRERY. Madam Chairman, I thank the gentleman for yielding me 
time.
  Madam Chairman, I want to talk for just a while about the basis for 
reform. I think it is worthwhile to examine the current welfare system 
and its results over the last few years.
  This chart shows very graphically, this line right here is the 
poverty rate in the United States. Beginning in 1950, you can see it 
drops until about 1965 or so.
  Well, it just happens to be that 1965 was the beginning of the Great 
Society programs, and the avalanche of welfare spending in this 
country; as it has been said, $5 trillion over the last 30 years.
  What happens in 1965? It flattens out, the poverty rate, and then 
even goes up. So nothing has happened on the poverty rate. It has even 
gone up a little bit since 1965, since we have spent $5 trillion.
  This blue line right here is spending on welfare. Look, it is going 
off the chart in 1995. We are not getting the results, folks, that were 
advertised with all the taxpayer spending that we have done.
  It is the current system that is trapping children in poverty. It is 
the current system that is cruel to children. And if you do not 
recognize that, you have not been paying attention.
  Now is the time, not next year, not 5 or 10 years from now, now is 
the time finally to do something about this terrible welfare system 
that we have got. The status quo stinks. Admit it. Let us do something 
about it and quit talking about it.
  We sent the President two welfare bills. We are going to send him 
another one. We keep modifying it. This one is patterned after the 
bipartisan Governors' proposal. I have met with the President to talk 
about welfare reform, and this is very, very close. This bill is very, 
very close to what the President says he wants.
  Let us pass it, send it to him, and I hope he signs it.
  Mr. SABO. Madam Chairman, I yield 2\1/2\ minutes to the distinguished 
gentleman from Tennessee [Mr. Ford].
  Mr. FORD. Madam Chairman, let me thank my colleague for yielding me 
time.
  Madam Chairman, much of today's welfare news is good. There are fewer 
welfare and food stamp recipients today than when President Clinton 
took office. The poverty rate is down and teen pregnancy rates are 
lower in most States. Teen birth rates have dropped as well. Child 
support collections have grown and welfare reform is alive and well in 
States, thanks to 38 waivers approved by the Clinton administration.

[[Page H7799]]

                              {time}  1115

  That is all good news for the President and even better news for 
American families.
  Unfortunately, Madam Chairman, we have not made much progress on 
national welfare reform. Partisan politics seems to have gotten in the 
way, and that is a shame. President Clinton has twice sent Congress 
welfare reform proposals. He has sent clear signals about the kind of 
reform he will sign into law. He wants a bill that requires work, 
promotes responsibility, and protects children. He would impose tough 
time limits and work requirements, provide more funding for child care, 
require teen parents to live at home and stay in school, and crack down 
on child support enforcement. And that is real welfare reform.
  He vetoed the Republican plan, H.R. 4, because it was not real 
welfare reform. He rejected H.R. 4 because it was weak on work, it did 
little to move people from welfare to work, it did not guarantee child 
care, it gutted the earned income tax credit, it was tough on children, 
it made unacceptable deep cuts that undermined child welfare, school 
lunch, and aid to disabled children. It was a step backward in an 
effort to get health care coverage to all Americans and it eliminated 
the guaranteed medical coverage that single parents need to move from 
welfare to entry-level jobs.
  Thanks to the National Governors' Association, today we will try 
again to send another welfare package to the President. I remain 
skeptical about what my Republican colleagues want as a bipartisan 
effort in a Republican bill. Admittedly, this new Republican plan 
corrects some of the worst mistakes of the vetoed bill, confirming that 
the President was right to say ``no'' to the last Republican plan, but 
it looks to me like the Republicans want to make certain that this bill 
is also unacceptable to the President.
  I want one point to clear, Madam Chairman. I support welfare reform. 
So does our President. But we also want to make sure that needy 
children are not the victims of excessive election-year posturing. Real 
welfare reform should give children a safety net on which to rely, and 
it makes certain children are not punished for the mistakes of their 
parents.
  Mr. ARCHER. Madam Chairman, I yield 3 minutes to the gentleman from 
Texas [Mr. DeLay], the whip of the House.
  Mr. DeLAY. Madam Chairman, I thank the chairman for yielding me this 
time, and I rise in support of this legislation. I really commend the 
chairman of the Committee on Ways and Means and the Committee on the 
Budget for their efforts in producing this legislation.
  Madam Chairman, as my colleagues ponder their vote on this important 
issue, I would just urge them to consider this question: Does the 
current welfare system help people realize the American dream? If the 
answer is no, we should vote for this reform legislation.
  I believe that the current welfare system has destroyed the American 
dream for too many people, and this bill represents an important part 
of our agenda to restore the American dream. It also represents a core 
philosophical principle; that a hand-up is better than a hand-out.
  The American people have rightfully demanded that we fix this welfare 
system. They instinctively understand that the current welfare system 
undermines incentives to work, encourages the expansion of the 
underclass, breaks up families, and promotes welfare as a way of life. 
And they understand that the current system is a perversion of basic 
American values that value work, that promote personal responsibility, 
and that foster freedom.
  This reform legislation values work. It requires that every able-
bodied welfare recipient work for their benefits within 2 years. It 
promotes personal responsibility. It cracks down on deadbeat dads, 
giving States the tools to track down men who leave or abandon their 
families and leave their children to fend for themselves. And it 
fosters freedom.
  Scripture says if you give a man a fish, he can eat for a day; but if 
you teach a man to fish, he can eat for the rest of his life.
  Our reform plan gives welfare recipients the incentives to gain their 
freedom, to gain control of their lives and to become productive 
members of society.
  Madam Chairman, some on the left call our efforts mean and extreme. 
Well, I say that defending the status quo is extreme. Continuing the 
current system that has destroyed families and promoted dependency is 
mean. The legislation, this legislation, is a commonsense effort to 
restore the basic American values of work, personal responsibility and 
freedom to our Federal welfare system. It is a necessary step to 
restore the American dream for those who are currently in the welfare 
system.
  I urge my colleagues to have the courage to change this system. Stand 
with the American people and vote for this commonsense reform plan.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the gentleman from 
Virginia [Mr. Payne].
  Mr. PAYNE of Virginia. Madam Chairman, I thank my colleague for 
yielding me this time.
  Madam Chairman, Republicans and Democrats agree that the current 
welfare system does not work. Instead of requiring work, it punishes 
those who go to work; instead of instilling personal responsibility, it 
encourages dependence on the Government; and instead of encouraging 
marriage and family stability, it penalizes two-parent families and 
rewards teenage pregnancies.
  We all agree that welfare must be dramtically reformed, and that 
welfare should only offer transitional assistance leading to work, not 
a way of life. Where we disagree, however, is whether the Republican 
bill will make transition to work a reality or whether it is just empty 
rhetoric.
  Real welfare reform must be about replacing a welfare check with a 
paycheck. Real welfare reform gets people into the work force as 
quickly as possible. In order to do that, real welfare reform provides 
enough money for the work requirements to be effective.
  The Congressional Budget Office has concluded that the Republican 
bill will not work because most States will fail to meet the work 
requirements. It will be less expensive for the States to accept the 
penalties for failing to meet the participation rates than it will be 
to meet the costs of the work programs.
  Creating a system that is prone to failure from the outset is not 
real welfare reform.
  The Castle-Tanner bipartisan bill provides $3 billion in supplemental 
funds for States to meet the costs of work programs for welfare 
recipients. This is money in the bank, not just an authorization backed 
by a hope that someday we might actually find this money.
  The Castle-Tanner bipartisan bill provides real welfare reform and I 
urge my colleagues to support this plan.
  Mr. SHAW. Madam Chairman, I yield 2 minutes to the gentleman from New 
Jersey [Mr. Zimmer], a distinguished member of the Committee on Ways 
and Means.
  Mr. ZIMMER. Madam Chairman, I thank the gentleman from Florida for 
yielding me this time, and I commend him for his tenacious and 
principled support for true welfare reform.
  Madam Chairman, welfare as we know it has unmercifully condemned 
generation after generation of Americans to a life without hope and 
without access to the American dream. This bill will foster 
independence by breaking the chains that bind families to the welfare 
state.
  The current system, which fosters poverty, despair, hopelessness, and 
illegitimacy will be replaced with a program that generates hope, 
optimism, and self-esteem. People will be accountable for their own 
lives. Mothers and fathers will be responsible for the children they 
bring into this world.
  What this bill proposes is very straightforward: No more money for 
nothing. It tells the poor that we will help you get on your feet but 
we owe it to you as well as to ourselves, to require that you work for 
your benefits, and that after a specified period of time you get a real 
job.
  You see, work is not punishment. Work is the foundation of the 
American dream. It gives us self-respect and gives our children respect 
for us and for themselves.
  I urge those who have rejected reform in the past to reconsider for 
the sake of our future. I urge this House to

[[Page H7800]]

pass this legislation. I urge the President to sign this legislation.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentlewoman from North Carolina [Mrs. Clayton].
  Mrs. CLAYTON. Madam Chairman, I thank the gentleman for yielding me 
this time.
  Madam Chairman, in a ideal world we would not be forced to save money 
while sacrificing even some of our children. In an ideal world we would 
provide something to wear, something to eat, and a place to sleep for 
all of our children, even those who happen to be born in circumstances 
not of their own creation or their own will. In an ideal world we would 
not set time limits and spending caps and impose budget savings 
requirements on the most vulnerable people of our society, our 
children.
  I realize, however, we do not live in an ideal world. I too believe 
we must reform our welfare system because the current welfare system 
surely is not working. However, the proposed welfare system by the 
Republicans is doomed not to work either. In fact, I offer to say that 
it will not work for millions of children and for millions of mothers 
that we want to be self-sufficient and who desire to work.
  I intend to vote for Castle-Tanner because it treats our children 
better than the bill before us treats them. It honors people's will. 
The bill before us is short on reform, weak on work, and tough on 
our children. Millions of children will be abandoned.

  I admonish my colleagues, as they consider the decision they will 
make in the context of the decisions we make all the time, and the ones 
we have made. Last week this House refused to fund teenage pregnancy 
prevention programs by $30 million, yet now we are talking about 
teenage pregnancy as if we wanted to prevent it. We are now willing to 
punish them, however, if indeed they happen to have a child.
  We should have stepping stones for our children and not have them as 
stumbling blocks. Recently the education funding was slashed. Where is 
the development in our children? This House has voted numerous times to 
cut nutrition programs.
  We should not abandon our children. The proposal before us does not 
honor the principle of work, responsibility and caring for children.
  Mr. SHAW. Madam Chairman, I yield myself such time as I may consume 
to advise the last speaker who said that our bill is tough on children 
that the bill she referred to, which will be the Gephardt substitute, 
mimics exactly what is in the bill that she is criticizing as far as 
the children's program are concerned.
  I would also tell the gentlewoman that in the bill there is some $6 
billion of cuts in EITC, which is what the President criticized the 
Republicans for as calling that a tax increase. It is not in our bill, 
it is in her bill.
  Madam Chairman, I yield 2 minutes to the gentlewoman from Washington 
[Ms. Dunn], a distinguished member of the Committee on Ways and Means.
  Ms. DUNN of Washington. Madam Chairman, I am involved in this debate 
on welfare because I believe that the current welfare system and what 
it does to children, and families is a crime. The system is cruel, it 
is broken, and it needs to be fixed.
  For the third time today, Madam Chairman, we are going to vote to 
send to the President a welfare bill so he can keep his promise that he 
made in his campaign to reform welfare. It is a clean bill and it 
protects children.
  It is based on three principles: One, that welfare should not be a 
way of life; that these poor children, some of whom never have a 
working role model in their lives, will not be put in that position 
ever, ever again. It is also based on the second principle of returning 
flexibility to the States; and, third, it is based on the principle 
that if Government is going to provide incentives in our lives, that 
the incentive in welfare should be to encourage personal responsibility 
in our citizens.
  Today I want to focus on one thing that is probably the most 
important thing in this whole debate, and that is the children. Back 
home in Washington State women tell me, ``Jennifer, my child support is 
the sole difference between making ends meet and going on welfare.'' On 
behalf of these women, we have a responsibility to make sure that 
deadbeat parents pay their child support to their own flesh and blood 
children.

                              {time}  1130

  Today in this Nation, Madam Chairman, $34 billion is owed by parents 
who have left their children's home to custodial parents. Thirty 
percent of these people leave the State in order to avoid that 
responsibility. I think it is outrageous. The tools this bill provides 
give us the way to track those deadbeat parents down.
  I know what it is like to raise children as a single parent. I have 
done that. I worried about money, and I worried about child care. I 
worried about how you fit a full-time job around the responsibilities 
of my own children's needs. It is hard enough in my case, Madam 
Chairman, where I did receive support. I cannot imagine what it would 
be like when a parent did not receive that support.
  It is the mothers and the children that we have included in these 
provisions. As far as I am concerned, Madam Chairman, the President 
needs to sign this bill for the sake of our children.
  Mr. SABO. Madam Chairman, I yield 30 seconds to the gentlewoman from 
North Carolina [Mrs. Clayton].
  Mrs. CLAYTON. Madam Chairman, I want to respond to the distinguished 
chair of the Committee on Ways and Means. The bill that he said that I 
am supporting, I am delighted to be supporting, Castle-Tanner, really 
indeed allows States to provide for vouchers, wherein his bill does 
not.
  Castle-Tanner also provides Medicaid coverage for children, where his 
bill indeed does not. Castle-Tanner also has a no caps on assistance in 
the event of an economic turndown. The bill he has makes no provisions 
for that, or very limited, in their contingency fund.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the gentleman from 
Maryland [Mr. Cardin].
  Mr. CARDIN. Madam Chairman, I along with many of my colleagues on 
both sides of the aisle have been working for almost 4 years to 
dramatically reform our Nation's welfare system. The current system has 
failed. A new system is needed. The Federal Government in partnership 
with our States needs to provide temporary compassionate assistance to 
those who have genuine need, making it clear that people who receive 
welfare must become employed as soon as possible in a private sector 
job. We must move people off of welfare to work.
  My concern is that the Republican bill will move people off of 
welfare, but in far too many cases our children will end up on the 
streets.
  The Republican bill is woefully inadequate in providing resources to 
our States. It is inadequate in financing safe, affordable day care for 
welfare parents. It does not adequately deal with one of the principal 
problems in our welfare system; that is, preventing out-of-wedlock 
births, particularly among our teenagers.
  Quite frankly, the failure of the Republican bill is because it was 
developed in a partisan political manner, rather than in an open 
legislative format. We have not even really had a chance to review this 
bill because it was developed by the Republicans in a closed meeting, 
rather than using an open forum so that we could debate some of these 
issues and could work out some of these issues.
  The Castle-Tanner bill substitute is the only bill that has been 
worked out in a bipartisan manner in an open forum. I urge my 
colleagues to support the Castle-Tanner substitute. It is far better 
than the Republican bill and although I believe it can be improved, I 
urge my colleagues to vote for the substitute and against the 
underlying bill.
  Then let us work together, Democrats and Republicans, to dramatically 
change our welfare system. It can be done this year. If our objective 
is to get a welfare bill enacted, I urge my colleagues to follow that 
action. If our objective is to get the President to veto another bill, 
then I understand what the Republicans are doing.
  Mr. SHAW. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from the State of Georgia [Mr. Collins, a valued member of 
the Committee on Ways and Means.
  Mr. COLLINS of Georgia. Madam Chairman, I thank the chairman for 
yielding the time to me.
  Madam Chairman, we have previously debated and passed legislative 
proposals that will change the welfare

[[Page H7801]]

system. And although President Clinton vetoed those measures, he has 
proposed welfare legislation of his own.
  So today, we have two different approaches to welfare reform. We must 
clearly understand that the real debate is about whether we are going 
to just piecemeal reform the broken welfare system, or if we are going 
to entirely change welfare as we know it.
  We all agree the welfare system is a failure. It is an open-ended 
Federal entitlement that encourages people to believe that receiving a 
welfare check, free health care, and other free services without 
working is their right. By the end of the decade, American workers will 
have spent over $6 trillion on welfare programs. After 30 years under 
the current system, our poverty rate remains unchanged and we have 
millions of people trapped, dependent upon broken welfare programs.
  Americans are tired of paying for a welfare system that just doesn't 
work. And although Presidential candidate Clinton once stated that he 
intended to change welfare as we know it, his proposal will only make 
limited reforms to a system that fails those who receive welfare and 
those working people who pay the bill.
  In sharp contrast to the President's patchwork plan, the Republican 
majority's proposal changes the welfare system as we know it. The 
Republican plan will remove the one-size-fits-all entitlement system. 
This measure will transfer the management authority from the 
bureaucratic Federal level to the States. Local authorities will 
finally have the ability to design a welfare program that best meets 
the needs of the poor in their region. Welfare programs will be 
administered on a local level through a State/Federal financial 
partnership. The responsibility for administering welfare programs will 
be where it needs to be: closer to those who know what works, closer to 
those who need the assistance, and closer to the workers who pay the 
bill.
  Working Americans support the Personal Responsibility and Work 
Opportunity Act because it will comprehensively change the welfare 
system as we know it.
  Mr. SABO. Madam Chairman, I yield 2 minutes and 30 seconds to the 
distinguished gentleman from California [Mr. Waxman].
  Mr. WAXMAN. Madam Chairman, I rise in opposition to the Republican 
welfare bill. This legislation masquerades as reform, but it is not 
that. It is instead a giant step back into poverty for millions of 
American children.
  But it is more. This bill will have a devastating impact on the 
health care system in many urban areas and in many States in this 
Nation because of its mean-spirited and shortsighted provisions to deny 
Medicaid funds for necessary medical care for legal immigrants.
  Whatever the view Members may have as to whether we should provide 
cash support to legal immigrants who end up in need of assistance, 
there can be no justification to deny health care services to persons 
who are legally in this country. Cutting Medicaid funds is not going to 
keep people from getting sick. It is not going to keep them from 
needing health care services. All this bill will accomplish is to keep 
them from going for care when they need it and causing them to be 
sicker and more costly cases when the situation becomes so bad they end 
up in an emergency room.
  Local hospitals and local governments are going to be left holding 
the bag for these costs. The sad fact is, they cannot afford it. There 
should not be a Member from California in this House that supports this 
policy. It will have devastating consequences for Los Angeles, and it 
will have devastating consequences for the State of California.
  The $12 billion reduction in Medicaid expenditures resulting from 
these provisions is fully one-fifth of the expenditures my Republican 
colleagues were trying to cut from Medicaid with their block grant 
proposal. Trying to achieve a big chunk of those so-called savings 
through the back door of the welfare bill by taking away any access to 
Medicaid for legal immigrants is wrong. It will hurt urban hospitals. 
It will hurt innocent people. It is the wrong thing to do.
  Mr. SABO. Madam Chairman, will the gentleman yield?
  Mr. WAXMAN. I yield to the gentleman from Minnesota.
  Mr. SABO. Madam Chairman, is what the gentleman is saying that this 
bill will mean a significant transfer from Federal resources to 
obligations on the local property tax?
  Mr. WAXMAN. Absolutely.
  Mr. SABO. Madam Chairman, I thank the gentleman for his answer.
  Mr. SHAW. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from Pennsylvania [Mr. English], a valued member of the 
Subcommittee on Human Resources of the Committee on Ways and Means.
  Mr. ENGLISH of Pennsylvania. Madam Chairman, today we will vote on 
fundamental welfare reform legislation, a mainstream proposal that 
working families across the Nation have been demanding for years. Three 
decades and $5 trillion ago, this Nation declared war on poverty. What 
was the outcome? All we have to show are casualties. Children killing 
children, boys and girls growing up without fathers, and welfare 
recipients spending an average of 13 years out of work because work 
does not pay as well as Uncle Sam.
  Madam Chairman, generations have been trapped in this soul-destroying 
system, prisoners of the lost war on poverty. I have to ask this House: 
How many more of our children must we lose to poverty and violence 
before we say, enough is enough? We have the opportunity today to 
change America by fixing the failed welfare state and restoring the 
American dream for an abandoned underclass.
  Under this bill, welfare will be converted into a work program. Every 
person receiving welfare must work within 2 years or cash benefits will 
end. Under our bill, lifetime welfare benefits will be limited to 5 
years but up to 20 percent of families can be exempted for hardship. 
States are required to have 50 percent of welfare families working by 
2002.
  Our bill will end welfare payments for noncitizens; those we welcome 
to our country as guests should not abuse the hospitality of hard-
working Americans. American families are spending $8 billion every year 
on welfare for noncitizens. That is not fair.
  Our bill will stop the destructive practice of giving Social Security 
cash benefits to drug addicts and alcoholics, blighting their lives at 
great public expense.
  Madam Chairman, we in Washington need to learn from past mistakes. We 
must create a welfare system that ties welfare rights to responsible 
behavior.
  I urge all of my colleagues to put aside petty partisan politics. 
Support this bill and allow this Congress to leave an enduring legacy 
of social reform.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentlewoman from Florida [Mrs. Meek].
  (Mrs. MEEK of Florida asked and was given permission to revise and 
extend her remarks.)
  Mrs. MEEK of Florida. Madam Chairman, I thank my ranking member for 
yielding the time to me.
  I say over and over again, this is a flawed bill. It is not hard to 
see it. They are wrapping it in politics to try and save the fact that 
there is no substance in this bill that is going to save the children 
of this country.
  Everything I have heard from the majority side makes me know they 
have never, ever experienced welfare. Now they are beginning to try to 
reform it. I want to reform it. I know it needs to be reformed. But it 
does not have to be reformed on the backs of the children of this 
country. It does not have to be reformed on food stamps. And they are 
having a similar idea that people who get food stamps, AFDC, do not 
know how to choose their food. That is not correct. The same Members 
who feel that way are the ones who drafted this bill.
  This bill is going to deny 300,000 children of legal immigrants from 
getting food stamps. Do they want to cut children off from food? They 
have said they have a family-friendly atmosphere in the Republican 
Party. This does not meet the test of family-friendly.
  Until yesterday they have changed back and forth so much, it is hard. 
I have not seen this new language. But yesterday their bill prohibited 
benefits and vouchers. Now they have switched over and now they are 
making that, they are putting that in, but they are not requiring it. 
They are not fooling

[[Page H7802]]

me, because they are making it permissive. They cannot do it or they 
may do it. Why not say, as our bills do, that they will be required to 
provide vouchers to these children who will go off Medicaid?
  My colleagues have exceeded the limits of care and sympathy and 
compassion which this Congress is supposed to give to the American 
people. They are not fooling the American people by saying this is a 
good welfare bill. We all want to reform welfare. Why can we not get 
together, both Republicans and Democrats, put our heads together and 
reform this without having a one-sided view toward Medicare and toward 
welfare?
  I say to my colleagues, turn this bill back. I do not blame the 
President of the United States. Every time we send him a bad bill, he 
should veto it, no matter how many times.
  Mr. SHAW. Madam Chairman, I yield 1 minute to the gentlewoman from 
Washington [Ms. Dunn].
  Ms. DUNN of Washington. Madam Chairman, I thank the gentleman for 
yielding the time to me.
  I am very alarmed at the misinformation I have heard last evening and 
today coming out on the issue of child care. I want to set something 
straight. In the Republican bill, the bill that we are debating and 
voting on today, in fact, we have been told by the people who make 
these estimates that we need, in child care, $16 billion to perform the 
duties that are outlined in the bill. We have, in fact, in the 
Republican bill provided $23 billion.
  Madam Chairman, I just want to say in my book of mathematics, that 
leaves $7 billion aside that can be helped to ease working mothers off 
AFDC into the working world.

                              {time}  1145

  In addition, Madam Chairman, that is $4.5 billion more than is in the 
current child care portion of the welfare bill. It is also very 
important, as it is also $2 billion more than the President has in his 
own legislation.
  Mr. SHAW. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from Nevada [Mr. Ensign], a member of the Committee on Ways 
and Means.
  Mr. ENSIGN. Madam Chairman, I think we have to ask ourselves a couple 
of fundamental questions. First of all, has the current welfare system 
worked? Has it helped children? Is it compassionate, especially to 
those children? Should we continue to give cash payments to prisoners 
and drug addicts?
  The answers to these questions are obvious. Out-of-wedlock births 
have skyrocketed since our welfare system began. Crime rates have 
skyrocketed. This is federally funded child abuse.
  Madam Chairman, we tell the teenage mom, ``If you have a child out of 
wedlock, move away from your parents, we'll get you an apartment. By 
the way, don't work, don't save, and if you want a little extra money, 
have another child out of wedlock.'' This is truly federally funded 
child abuse.
  Our bill does something remarkable. It reforms welfare in a 
compassionate way. It has $2 billion more, as the previous speaker 
talked about, for child care than the President does so that in the 
transition from welfare to work we can help families do that.
  We also provide transitional health care, which is one of the biggest 
incentives to staying on welfare, the lack of health care coverage.
  We also stopped cash payments to noncitizens and prisoners. There is 
a fundamental disagreement between that side of the aisle and this side 
of the aisle on whether we should continue cash payments to 
noncitizens. We believe, I believe strongly, that it should be reserved 
for U.S. citizens.
  We also fundamentally believe that we to have a limit, a time limit 
on the amount of time that somebody can receive welfare benefits. There 
is no greater incentive than to know that at the end of a certain 
period of time they are going to have to get a job, they better get 
their life together, they better get out there, take advantage of the 
job training we provide, get their life together so that they can get 
off of welfare so that they can take care of their own family and have 
that personal responsibility.
  Lastly, from somebody who grew up with a deadbeat dad, I am 
applauding this bill for the strong child support enforcement 
provisions that it has so we can go after those deadbeat parents who 
are abandoning their children and not taking full responsibility.
  I thank the chairman of the subcommittee for writing a great bill.
  Mr. SABO. Madam Chairman, I yield myself 1 minute to say I find it 
very unfortunate when we compare legal immigrants in this country with 
prisoners and put them in the same category.
  In fact I find it sort of personal. My parents were both immigrants 
to this country. I remember when my mother became a citizen. I also 
hear this discussion of nothing has ever been given or done in 
conjunction with legal immigrants. My father was a homesteader. That 
was how he and many other immigrants got started in this country, and 
they worked hard and did well.
  But regardless of how one feels on this question, to rhetorically 
combine legal immigrants with prisoners I think is totally unfortunate.
  Madam Chairman, I yield 2 minutes to the gentleman from Maryland [Mr. 
Hoyer].
  (Mr. HOYER asked and was given permission to revise and extend his 
remarks.)
  Mr. HOYER. Madam Chairman, there is a consensus on this floor that 
our welfare system undermines the core values Americans believe in: 
responsibility, work, opportunity, and family. Too many people who do 
not want to be on welfare cannot escape it. Too many people who want to 
be on welfare are allowed to coast at the taxpayers' expenses.
  We agree that we must create a different kind of social safety net 
which will uphold the values our current system undermines. It must 
require work, it must demand responsibility, and it must protect 
children.
  Today the House will consider two alternative welfare reform 
proposals. One, offered by the House Republican leadership, I suggest, 
is not reform at all, although it has much in it with which we agree 
and Castle-Tanner agree. It lacks the funds for serious work 
requirements. CBO says so, not us. And under this bill children can be 
denied all support, even in an emergency, when their families are cut 
off welfare due to time limits.
  When the American people demanded an end to welfare, this is not what 
they had in mind.
  The so-called welfare reform bill offered today by the Republican 
leadership makes a mockery, in my opinion, of the American values of 
work and family. It does have progress in it. But it is not bipartisan, 
and that is what the American public wanted. They wanted us to come 
together in-bipartisan manner and reform welfare. Governor Castle, now 
a Congressman, and the gentleman from Tennessee [Mr. Tanner] have done 
exactly that. Their bill brings together and reinforces family values, 
while meeting our responsibilities to our people and reinforcing our 
expectations on their personal responsibility.
  I urge my colleagues to come together in a bipartisan fashion, as 
most of the Members on this side of the aisle will do. Democrats will 
support a bipartisan effort to accomplish this objective. All of us 
should do the same.
  America's welfare system is at odds with the core values Americans 
believe in: Responsibility, work, opportunity, and family. Too many 
people who don't want to be on welfare can't escape it. Too many people 
who want to be on welfare are allowed to coast at the taxpayers' 
expense. In both cases, this broken system weakens families, undermines 
personal responsibility, destroys self-respect and initiative, and 
fails to move able-bodied people from welfare to work.
  A complete overhaul of the welfare system is long overdue. We must 
create a different kind of social safety net which will uphold the 
values our current system destroys. It must require work. It must 
demand responsibility. And it must protect children, to break the 
generational cycle of poverty.
  Today, the House will consider two alternative welfare reform 
proposals. First, offered by the House Republican leadership, is not 
reform at all. It lacks the funds for serious work requirements. It 
shreds the safety net for chidlren. The Nation's Governors adopted a 
resolution expressing their concern about restrictions on States' 
flexibility and unfunded costs in the Job Program, a shortfall of $13 
billion which will knock the teeth out of the much-touted work 
requirements in the Republican bill.

[[Page H7803]]

  The second alternative, the bipartisan Tanner-Castle welfare reform 
proposal, will truly reform our broken system. It, and it alone, 
requires all recipients to start work--real work, in real jobs--within 
2 years. It provides funding to make those requirements real. It 
establishes a 5-year lifetime limit for welfare benefits, with a State 
option to create a shorter limit. It requires teen parents to live at 
home or in a supervised setting, and teaches responsibility by 
requiring school or training attendance as a condition of receiving 
assistance. It includes tough child support enforcement provisions to 
make sure deadbeat parents live up to their responsibility to support 
their children.
  Unlike the Republican leadership proposal, the Tanner-Castle bill is 
tough on work without being tough on kids. It includes additional 
funding above the leadership bill for child care, to make sure children 
aren't left on the streets when their parents go to work. Under the 
Republican leadership bill children could be denied all support, even 
in an emergency, when their families are cut off welfare because of a 
time limit. The bipartisan bill provides vouchers to meet the needs of 
children if their parents exceed the welfare time limit. While the 
Republican leadership bill would deny Medicaid coverage for children in 
families who exceed a time limit, the bipartisan bill ensures that no 
child loses medical care because of welfare reform.
  The so-called welfare reform bill offered today by the Republican 
leadership makes a mockery of the American values of work and family. 
It contains a hollow promise of work requirements which the Nation's 
Governors and the Congressional Budget Office both concede States can 
never achieve. It strips poor children of food assistance and medical 
care. I do not believe that when the American people demanded an end to 
welfare as we know it, this is what they had in mind.
  The bipartisan Tanner-Castle bill supports those American values we 
all share. It demands work and personal responsibility without 
shredding the social safety net and abandoning children. I urge my 
colleagues to reject the Republican leadership bill, and support the 
bipartisan Tanner-Castle proposal.
  Mr. SHAW. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, I would like to respond very quickly to what the 
gentleman from Minnesota [Mr. Sabo] said. Nobody in this House is 
criticizing or putting anything saying that people coming into this 
country to experience the American dream are in the class of felons. 
That is ridiculous. That argument falls on deaf ears. It has no 
relevancy.
  But I would like to share this with him. When his parents or 
grandparents came into this country, they made a pledge not to become a 
public charge, and I would bet next week's paycheck that they did not 
become a public charge. They came for a better way of life, and they 
went to work. They made something of themselves, and they had a child 
or a grandchild that came to the U.S. Congress.
  I would also like to say, when we are talking about aliens, aliens 
over 65 are five times more likely to go on SSI than citizens over 65. 
Alien SSI applications have increased 370 percent from 1982 to 1992. We 
have got to stop making welfare available for citizens of other 
countries. It is that simple.
  Madam Chairman, I yield 2 minutes to the gentleman from Nebraska [Mr. 
Christensen], a valuable member of the Committee on Ways and Means.
  Mr. CHRISTENSEN. Madam Chairman, welfare reform is an issue, like the 
previous speaker said, that we can agree on, that we can come together 
on in a bipartisan fashion and that we can work together on. I think 
all agree that the welfare system has caused people to rely on the 
Government instead of themselves. I think Senator John Ashcroft said it 
best last week when he talked about the system, that it has deprived 
hope, it has diminished opportunity, and it has destroyed lives.
  But there are questions that we have to ask. After spending billions 
of dollars, has the Government solved the problems of poverty and of 
dependency? How many more families are we going to allow to be trapped 
in the current system before we get a bill out of this House? How many 
more children must we sacrifice to poverty before we say enough is 
enough?
  As my colleagues know, we have heard many people say, and I think the 
statement is accurate, the fact is we cannot have a moral environment 
to raise children in America when we have 12-year-olds having babies, 
15-year-olds killing each other, 17-year-olds dying of AIDS, and 18-
year-olds who are graduating with diplomas that they cannot read. If we 
are to restore our moral health in this country, we must change the 
system that fosters that environment.
  As Franklin Delano Roosevelt said in the late 1930's, giving 
permanent aid to anyone destroys them. Our bill gives people a chance. 
It puts a hand out so they can help themselves.
  It is time that we worked together in a bipartisan fashion to end 
welfare as we know it.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from Washington [Mr. McDermott].
  (Mr. McDERMOTT asked and was given permission to revise and extend 
his remarks.)
  Mr. McDERMOTT. Madam Chairman, the gentlewoman from Florida put her 
finger on the fundamental problem here, and that is that the Republican 
bill will not guarantee support to children if all else fails.
  Now, my brother runs the public assistance program in the State of 
Washington. I know the facts. In the State of Washington there are 
100,000 adults on welfare, 125,000 people, unduplicated count, on 
unemployment. That is 225,000 people on average every month in the year 
1995. If they all showed up for a job on tomorrow, there would be jobs.
  Last year they created 44,000 new jobs in the State of Washington. 
That means 181,000 adults in the State of Washington, that DRI, McGraw-
Hill, the economic forecaster says is the fifth most rapidly growing 
State in this country, could not get jobs, 181,000 people.
  Now the Labor Department has recently said that the unemployment rate 
is as low as it ever is. Tomorrow Mr. Greenspan is going to meet with 
the Federal Reserve to talk about raising the interest rates so that we 
can slow the economy so we do not have inflation. Now, we cannot slow 
the economy and stop job creation when we have 181,000 people in 1995 
in the State of Washington who could not get a job and say to their 
children, ``Hey, folks, kids, I'm sorry. Your Ma went down for a job, 
but there was none, and you can't eat.'' That is what the Republican 
bill says. They will not give a voucher if they have done everything, 
and there is no way.
  I think the President, who cares about the kids in this country, is 
going to take a long careful look at what comes out of this body 
because, if we are not careful of how we deal with the weakest and the 
most vulnerable in our society, we are not a civil society.
  Mr. SHAW. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from Texas, Mr. Sam Johnson, from the Committee on Ways and 
Means.
  (Mr. SAM JOHNSON of Texas asked and was given permission to revise 
and extend his remarks.)
  Mr. SAM JOHNSON of Texas. Madam Chairman, I have to disagree with the 
gentleman that just spoke. It is a shame, but I tell my colleagues 
that. The Government has been spending billions of dollars, and I would 
just like to know, has the Government solved our problems of poverty 
and dependency? I think not. How many more families are going to be 
trapped in the current system while we spin our wheels here in 
Washington, DC. talking about it? Do my colleagues not think that State 
and local governments, churches and communities can do a better job of 
caring and providing for our Nation's welfare recipients? Of course 
they can.
  As my colleagues know, how many more of our Nation's cities are we 
going to surrender to poverty and violence before we here in Washington 
decide to act? Why does Washington continue to promote a welfare system 
that encourages illegitimacy and discourages parents? Should not 
Washington encourage work? I think so.
  I tell my colleagues what this bill is about: compassion, hope and 
opportunity. It is about people coming together and taking charge of a 
system that has failed them and every mother and child on welfare.
  Do we trust Washington, or do we trust the local charities, the 
churches, community centers, and local government officials? I trust 
and believe the American people at home will have the answer. Can we 
not do better than the welfare system that we have in place right now?

[[Page H7804]]

  This strong welfare reform bill ends welfare as we know it. It gives 
power back to the States, power back to the communities, power back to 
the people at local communities to solve their own problem. It is a 
must that we act today to pass this legislation.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentlewoman from California [Ms. Waters].

                              {time}  1200

  Ms. WATERS. Madam Chairman, both of these welfare reform bills before 
us are little more than poll-driven political responses to a real 
problem. This is not true welfare reform. Instead we are placing a foot 
on the necks of poor children and families and calling it reform. Every 
Member of Congress understands the difference between an AFDC 
entitlement and not having one. We all understand the difference 
between block grants and Federal involvement in this problem.
  In desperation, I appeal to each Member's spiritual sense. I 
challenge those who claim moral values. To the Christian Coalition 
supporters, I challenge you today, the Bible is replete with examples 
of how we are obligated to treat the poor. Witness Proverbs 14:31: He 
who oppresses a poor man insults his maker, but he who is kind to the 
needy honors him.
  Proverbs 29:7: A righteous man knows the rights of the poor; a wicked 
man does not understand such knowledge.
  Ecclesiastes 4:1: Defraud not the poor of his living, and make not 
the needy eyes to wait long.
  Ecclesiastes 4:4: Reject not the supplication of the afflicted; 
neither turn away thy face from a poor man.
  Proverbs 21:13: Who so stoppeth his ears at the cry of the poor, he 
also shall cry himself, but shall not be heard.
  And Deuteronomy 15:7-8: Thou shalt not harden thine heart, nor shut 
thine hand from thy poor brother; but thou shalt open thine hand wide 
unto him, and shalt surely lend him sufficient for his need.
  Mr. SHAW. Madam Chairman, I yield 1 minute to the distinguished 
gentleman from Tennessee [Mr. Wamp].
  (Mr. WAMP asked and was given permission to revise and extend his 
remarks.)
  Mr. WAMP. Madam Chairman, one of the most wonderful lessons for the 
young people of this country is that great things can be done in our 
society when it does not matter who gets the credit. The Republicans 
should be commended for taking Medicaid off of their welfare bill 
because the President, our President, came here in January and asked us 
for a clean welfare bill and said he would sign it into law. We should 
not worry if he gets the credit for doing that.
  This is the clean bill that he asked for; it is. We disconnected 
Medicaid so he would sign it, not so he would veto it. We should pass 
it today and give him this clean bill. It does not matter if he gets 
the credit. The Democrats should not care if the Republicans get the 
credit, because it is these children that are trapped in dependency and 
poverty that are going to get the benefit and the reward.
  We are doing the people's business. We should support the conference 
report when it comes back, and we should support the President so he 
can sign this bill into law and do the people's business.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from California [Mr. Fazio].
  Mr. FAZIO of California. Madam Chairman, I rise in strong support of 
the bipartisan welfare reform bill offered by Mike Castle and John 
Tanner.
  The Castle-Tanner bipartisan bill is a much better bill than the 
alternative presented by the other party. It requires work, and 
provides the support needed to make the commitment to work a reality 
and not just rhetoric.
  The bipartisan bill contains many provisions which represent a 
moderate, more balanced approach to welfare reform while still 
achieving over $50 billion in savings.
  It includes stronger protections for children and families under the 
block grant and assures the maintenance of a national nutrition safety 
net so that families will not go hungry and children will have the 
nutrition they need to grow and learn.
  The bipartisan welfare reform bill improves past efforts made by this 
House in significant ways while continuing to promote personal 
responsibility as its central theme.
  Indeed, this approach requires all welfare recipients to sign an 
individual responsibility contract which outlines a plan for the 
recipient to become self-sufficient as quickly as possible.
  And the bipartisan bill holds deadbeat parents responsible for their 
children through strong child support enforcement measures.
  Castle-Tanner also ensures greater State flexibility by giving the 
States the option of providing vouchers for the needs of the child, or 
emergency assistance to families that have reached the time limits but 
have been unable to find a job.
  This bill also provides a more substantial contingency fund to assist 
States with high unemployment or increases in child poverty. If the 
fund is exhausted during hard times, the bill creates an uncapped 
contingency fund for real emergencies.
  My colleagues, this bill provides greater resources to ensure that 
welfare reform will succeed, it improves State flexibility, and it 
guarantees fiscal and personal responsibility. Above all, it protects 
innocent children.
  We have an historic opportunity to pass a meaningful, bipartisan, 
welfare reform bill that the President will sign. Let's not squander 
this chance. I urge you to vote ``yes'' on the bipartisan substitute.
  Mr. SHAW. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, I would ask the gentleman from California if he is 
aware that the bill that he has endorsed imposes a tax increase which 
the President characterized as a tax increase on the working poor by 
slashing EITC?
  Mr. FAZIO of California. Madam Chairman, will the gentleman yield?
  Mr. SHAW. I yield to the gentleman from California.
  Mr. FAZIO of California. Madam Chairman, I would say to the gentleman 
from Florida, certainly this side of the aisle has been totally opposed 
to the Republican plans to slash the EITC and the budget.
  Mr. SHAW. Reclaiming my time, Madam Chairman. I would advise the 
gentleman from California that his bill does precisely that. Our bill 
does not.
  Madam Chairman, I yield 2 minutes to the gentleman from Ohio [Mr. 
Traficant].
  (Mr. TRAFICANT asked and was given permission to revise and extend 
his remarks.)
  Mr. TRAFICANT. Madam Chairman, I support the bill. While Congress has 
tried with good intentions, the Congress of the United States has 
failed. What began as a hand up is now a handout. Generation after 
generation are literally trapped at the bottom of the ladder without a 
good view of what America has to offer. The welfare system is not only 
broken, it is token. It has become a social placebo with a failing 
track record.
  I ask all who are in here today to deny the following. I say the 
welfare system currently promotes dependency and illegitimacy, 
discourages thrift, discourages work, separates, separates and destroys 
families, isolates children, and from an early age, stifles their 
ambition, no less.
  There is one other element here, folks, in this formula. Our current 
welfare system penalizes hardworking Americans who pay for this failing 
train that keeps rolling down the track at us, hurting us.
  This is not about Republican and Democrat. There should be more 
consensus today. This is about a welfare system that is bad for 
America. Let me submit that the Founders are rolling over in their 
graves looking at the great Constitution and saying, my God, how could 
this great instrument somehow be so misused, misapplied, that there are 
now Americans without hope, Americans without goals, and Americans 
without ambition? Shame, Congress. Come together on this issue. Pass 
this bill.
  Mr. SABO. Madam Chairman, I yield myself 30 seconds.
  Madam Chairman, I would indicate to the gentleman from Florida [Mr. 
Shaw] that all the EITC changes in Castle-Tanner rely on compliance. 
None of them change the phase-out rates as proposed originally by the 
House Republican plan. Those are not

[[Page H7805]]

included in Castle-Tanner. Fortunately, you have pulled those 
provisions out of your bill but they are scheduled to reappear in your 
budget resolution in reconciliation bill No. 3, and then some further 
additional cuts in EITC even beyond what you did in this bill 
originally.
  Madam Chairman, I yield 2 minutes to the gentleman from Massachusetts 
[Mr. Olver].
  (Mr. OLVER asked and was given permission to revise and extend his 
remarks.)
  Mr. OLVER. Madam Chairman, I thank the gentleman for yielding time to 
me.
  Madam Chairman, along with every Member of this Chamber, I believe 
that the current welfare system needs to be reformed. Over the course 
of this debate, which has continued now for more than a year, each and 
every one of us has voted to end welfare as we know it. Some of us want 
to move people to work while protecting the well-being of our children. 
Others want to squeeze as much money as possible from the system even 
if the action is punitive, unworkable, and threatens children. That is 
the crucial difference between the Republican bill and the bipartisan 
bill that we have before us today.
  Madam Chairman, H.R. 3734, the Republican bill, offers little 
protection for poor children. H.R. 3734, the Republican bill, prohibits 
vouchers for children of parents who have reached the time limit on 
welfare but cannot find jobs. H.R. 3734 slashes food stamps, the 
ultimate social safety net, assuring that more of our own children, our 
own poor children, will go hungry in a country whose farmers are so 
magnificently productive that they can feed half of the world.
  H.R. 3734 ends the guarantee of child protection and child abuse 
services, and worst of all, it ends the guarantee of health coverage 
for millions of poor women and children. We all want to see welfare 
reformed, Madam Chairman, but we should not jeopardize the health and 
well-being of children who are really totally without responsibility 
for the conditions that they are forced to grow up in.
  I urge a ``no'' vote on the Republican bill, Madam Chairman.
  Mr. SHAW. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, I would invite the gentleman from Minnesota to read 
on page 7, subtitle B, the earned income tax credit of the gentleman's 
bill. It provides and it has been scored that that is a $6 billion 
statement. The gentleman stands there and tells us that we are going to 
somehow put this into our bill. It is not in our bill, it is in the 
gentleman's bill.
  It is a tax increase. It is the gentleman's problem, and he is going 
to have to deal with it. We took it out of our bill because we did not 
want a tax increase on the working poor. He left it in his bill because 
obviously he wanted to take $6 billion out of the pockets of working 
Americans.
  Madam Chairman, I yield 2 minutes to the gentlewoman from Washington 
[Ms. Dunn].
  Ms. DUNN of Washington. Madam Chairman, I thank the gentleman for 
yielding time to me.
  Madam Chairman, Democrats have been arguing today that noncitizens 
are less likely to receive welfare than citizens, but the leading 
scholar in this area, whose name is George Borjas of the Kennedy 
School, says just the opposite.
  We have a chart here that I would like Members to look at. These 
numbers are percentages of households receiving welfare programs. The 
first line says ``Aid to Families with Dependent Children,'' our AFDC 
program. 4.4 percent of immigrant households receive this kind of aid, 
as opposed to 2.9 percent of folks who are citizens of the United 
States, and the chart continues.
  In short, Madam Chairman, I just want to say that there is simply no 
question that some Members are today on this floor spreading 
misinformation. Welfare for noncitizens has gotten out of hand. We have 
an opportunity through this legislation to change that.
  Madam Chairman, I would say, too, that America is a generous country. 
We welcome legal immigrants into this Nation, as long as they are here 
because they want to take advantage of a nation of opportunity. But we 
can no longer ask our citizens who work for a living to support people 
who are not citizens of the United States.
  Mr. SABO. Madam Chairman, I yield 1\1/2\ minutes to the gentleman 
from Michigan [Mr. Levin].
  Mr. LEVIN. Madam Chairman, the Republican bill is weak on work. It 
does not provide the resources, according to CBO. I want to say 
something, though, to my friend, the gentleman from Florida [Mr. Shaw], 
on the tax subject. Look, we forced you to drop your tax increases on 
the working poor. They were in your bill and you know it. We forced 
them out. Every bit of the EIT change in Castle-Tanner relates to 
compliance.
  Mr. SHAW. Madam Chairman, will the gentleman yield?
  Mr. LEVIN. I yield to the gentleman from Florida.
  Mr. SHAW. You forced it out, and where did it go? It went to your 
bill.
  Mr. LEVIN. Madam Chairman, I take my time back. The gentleman is 100 
percent wrong. You had a phasing down of the amount of money people 
could earn and still be eligible for the EITC. You had changes in terms 
of calculation of Social Security and its impact on EITC. We do not 
change the substance of the EITC law as it affects the working poor.
  We forced you not to do that, so do not use that sham argument. We 
say there should be compliance. We say the law should be followed. That 
is where all of our money is, and it is disgraceful that you do not 
have it in, and that you for months and months wanted to hit the 
working poor. Shame on you for using that argument.
  Mr. SHAW. Madam Chairman, I yield myself such time as I may consume. 
I want to respond to my good friend, a valued Member and a good friend 
of mine, and someone who has really worked hard, trying to work on 
welfare reform.
  Madam Chairman, I can tell the gentleman from Michigan, he is wrong. 
He has the increase in his bill. We do not have the increase in our 
bill. The gentleman gets up there and says shame on us for having it in 
there and then taking it out. That is absolutely ridiculous.

                              {time}  1215

  Mr. LEVIN. Madam Chairman, will the gentleman yield?
  Mr. SHAW. I yield to the gentleman from Michigan.
  Mr. LEVIN. Madam Chairman, compliance is not an increase.
  Mr. SHAW. Modification is. I would tell the gentleman, read section 
1023 of your bill.
  Mr. LEVIN. I have read it.
  Mr. SHAW. Modification of Adjusted Gross Income Definition for the 
Earned Income Tax Credit. You take working poor out by a modification 
of the definition.
  Mr. LEVIN. That is simply not true.
  Mr. SHAW. Madam Chairman, I reserve the balance of my time.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the gentleman from 
North Dakota [Mr. Pomeroy].
  Mr. POMEROY. Madam Chairman, the plan of the majority to reform the 
welfare system is weak on work and tough on kids. In my comments, I 
will talk about the work requirement.
  We must reform the welfare system. This reform is in fact overdue. 
The heart of the reform has to be time-limiting benefits and instilling 
a tough work requirement. There is broad agreement in the Chamber on 
that point. But the key distinction between the proposals before us 
this afternoon is that the bipartisan plan has a work requirement which 
will succeed and the majority's plan cannot.
  This is a very complex issue. There is nothing all that tough about 
understanding what it takes to make a work requirement succeed. 
Individuals presently receiving welfare benefits and not in a workplace 
must have the training required to achieve vocational skills before 
they will be employable and can stand on their own as constructive 
members in the workplace. Folks without jobs just will not be able to 
get jobs if they do not have job skills and employers. We cannot expect 
employers to hire folks that offer nothing in terms of what they need 
in the workplace.
  The nonpartisan Congressional Budget Office has assessed the two 
plans on this critical point. They say the work requirement in the 
bipartisan plan can

[[Page H7806]]

succeed but the work requirement in the majority's proposal falls $9 to 
$12 billion short of what it takes to make a work requirement succeed.
  That is the choice. The bipartisan plan, which time-limits benefits 
and gets today's recipients off welfare into the workplace as 
constructive members of our society, versus the majority's proposal 
which, while it claims to have a work requirement, by the Congressional 
Budget Office's own evaluation it falls short of what it takes to 
create a work requirement which has any chance of getting people off of 
the welfare rolls and into the workplace.
  Vote ``yes'' on Castle-Tanner and no on the majority proposal.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the gentlewoman from 
Connecticut [Mrs. Kennelly].
  Mrs. KENNELLY. Madam Chairman, there are differing opinions on to how 
to reform welfare. But one area that we all agree on is the need to 
improve our child support laws. In fact, this might be the single area 
where we have had consistent bipartisan cooperation.
  However, a last-minute change was inserted into the bill's child 
support title that weakens assurances of fair child support awards.
  The majority's welfare bill now guts a provision in current law that 
requires States to review child support orders every 3 years for AFDC 
families.
  I should first point out that this change will cost the Federal 
Government $63 million over the next 6 years. Child support paid on 
behalf of families on AFDC helps offset the cost of welfare. Therefore, 
regular updates in child support orders mean fewer dollars being spent 
on AFDC. The change in the bill ignores this fact and lets noncustodial 
parents off the hook, while sticking Federal taxpayers with the bill.
  I am also concerned this change in modifying child support orders 
might hurt families leaving AFDC. If we want families to leave welfare 
and become self-sufficient then we should ensure that they have the 
child support they are owed.
  I urge my colleagues to think twice before watering down child 
support enforcement, while preaching getting tough on young mothers. 
Let's all agree that we need tough child support enforcement that says 
both parents should be involved in providing for their children.
  Mr. SHAW. Madam Chairman, I yield 3 minutes to the distinguished 
gentleman from Louisiana [Mr. Hayes], a member of the Committee on Ways 
and Means.
  (Mr. HAYES asked and was given permission to revise and extend his 
remarks.)
  Mr. HAYES. Madam Chairman, it was the mid-1960's, and I remember the 
day very well when as a student in a Louisiana public high school and 
part of a debate squad, we were talking about Lyndon Johnson's effort 
at a Great Society with an alleged war on poverty. Three decades later, 
that same high school is in the midst of a war with drugs, teen 
pregnancy, and guns. Poverty has not changed. Over the course of that 
30 years, America has spent $5 trillion, an amount ironically close to 
the total national debt, on a fake war on poverty.
  So what happens to real veterans of real wars? Oh, I represent many 
of them. I represent a young man who was in a real war in Vietnam, who 
has got to find a way through his impaired health to get someone to 
drive him almost 100 miles to go to a real military installation to 
have a real druggist give him an honest, legitimate prescription.
  Unfortunately, within my congressional district there are crack 
addicts that cannot be evicted from Federal public housing because 
their neighbors cannot find a legal way to throw them out to prevent 
their own kids from being sold crack, and that person has a Federal 
welfare check delivered to their doorstep.
  I represent a group of Americans who in that three decades now knows 
that today they must work and work and work until May 7 of each year 
just to pay Government taxes. Then they get to earn money for their own 
family. Within the course of that work they recognize that there is 
almost $200 billion a year, most of which is thrown away on the dole to 
families who put work behind the rewards of a Federal handout. In 17 
States, the equivalent of welfare for starting welfare recipients is 
above $10 an hour. In 40 States, including my Louisiana, a starting 
welfare recipient is above $8 an hour, which is better than in many 
counties a starting teacher or a starting police officer.
  There are the kind of things where America looks and says: We don't 
want to change welfare as you folks in Washington know it, we want to 
change welfare as we know it in our neighborhoods, where senior 
citizens are terrified to leave at night because the monies that are 
diverted in a failed system for three decades prevent our own safety, 
our own sanctity, and the educational future of our own children.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the gentleman from 
Rhode Island [Mr. Kennedy]
  Mr. KENNEDY of Rhode Island. Madam Chairman, do you not love all this 
talk about how we are going to get money from these poor people to give 
money to other constituents who are more deserving? Yet this same 
Republican majority who is talking about cutting $53 billion from 
welfare has no problem giving a tax cut of $245 billion over 7 years, 
better than half of which goes to individuals and families with incomes 
of $100,000 or more.
  It seems to me that our Republican friends are against welfare for 
the poor but they have no problem with welfare for the rich. I do not 
want to hear my Republican colleagues talk about local control, because 
I worked in a State legislature and I know what block granting is all 
about. This mantra of States rights, let the States decides, let the 
States manage it, in my State of Rhode Island, that is a prescription 
for disaster. I will tell Members why. Because without the assistance 
that comes through entitlement programs, the money goes to the States. 
So the money goes to the State bureaucrats; it does not go to the women 
and children and the poor people who need the assistance.
  Once again under States rights, just as it stood 30 years ago, States 
rights means justice will depend on geography. If you are a poor person 
in Rhode Island, you will not be treated the same as if you are a poor 
person in a State like Tennessee, which has got a much better economy 
than we have in Rhode Island.
  Finally, my last point is that what this bill does to legal residents 
is shameful. To cut assistance to people who already pay taxes and in 
fact tax-paying, legal residents who do not enjoy many of the 
exemptions that regular citizens enjoy because they have not attained 
citizenship. They will be denied the same benefits as citizens. This to 
me represents no more than the same immigrant bashing that this 
majority has continued all 2 years it has been in the majority.
  Mr. SHAW. Madam Chairman, I yield 1 minute to the gentleman from 
Maryland [Mr. Gilchrest].
  Mr. GILCHREST. Madam Chairman, I thank the gentleman for yielding me 
this time.
  Madam Chairman, I think to a large extent the debate has covered most 
of the material on why it is important to change the welfare system as 
we know it today. I do not think there is one person in this Congress 
that would say the welfare system is working. It has perpetuated the 
paralysis of poverty far too long.
  There are some minor disagreements about how we ought to move 
forward. But at least we as a Congress want to move forward to make a 
fair assessment, to provide a program so that people have a sense of 
opportunity for the wonders that this Nation has to offer.
  This program that the gentleman from Florida [Mr. Shaw] is offering 
before this Congress does some amazing things. He discovers, in my 
judgment, the mystery of human initiative, and that is a sense of 
responsibility and a sense of dignity for all Americans.
  This is a fair bill, it is fundamentally sound. It will offer 
opportunity for individuals, whether they are on welfare now or may be 
on welfare in the future.
  Madam Chairman, I urge my colleagues to vote for Mr. Shaw's bill.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from Wisconsin [Mr. Obey].
  Mr. OBEY. Madam Chairman, the existing welfare system is broken, it 
needs radical overhaul. There is no doubt about that. But in doing it, 
I ask

[[Page H7807]]

every Member of this House to please put the politics aside. Taxpayers 
are tired of people who will not work taking a bite out of their tax 
dollars. They want us to be tough, but they do not want us to be mean.
  They do not want us to say to a worker who is laid off because his 
company moved out of town or out of the country, ``Tough luck, Charlie, 
you're on your own, baby.'' They do not want us to say to a sick or 
hungry kid, ``Sorry, kid, God gave you the wrong set of parents. You're 
on your own.'' They do not want us to pass a political document that 
will never become law, that is just designed to define the differences 
between Bill Clinton and Bob Dole one more time. They want us to work 
it out. They want us to get it done.
  That is what Castle-Tanner does. It is a bipartisan package. It does 
work it out. It is tough, but it is not mean. A friend of mine in the 
legislature used to say, ``You know, the problem with politics is that 
all too often it gives the poor and the rich the same amount of ice, 
but the poor get theirs in the wintertime.''
  That is the difference between the Castle-Tanner bill and the 
committee bill. Vote for Castle-Tanner. It is a tough, good welfare 
reform bill that gets the job done without being mean.
  Mr. SHAW. Madam Chairman, I yield such time as he may consume to the 
gentleman from Minnesota [Mr. Ramstad].
  (Mr. RAMSTAD asked and was given permission to revise and expend his 
remarks.)
  Mr. RAMSTAD. I thank the gentleman for yielding me this time.
  Madam Chairman, I rise in strong support of the Personal 
Responsibility and Work Opportunity Act.
  Madam Chairman, in 1992, Presidential candidate Bill Clinton pledged 
to ``end welfare as we know it.'' Today 4 years later, welfare 
recipients and taxpayers are still waiting for President Clinton to 
make good on his promise.
  The President could keep his word by signing the welfare reform 
waiver proposals on his desk from Wisconsin and Minnesota, as well as 
the comprehensive Federal welfare reform bill before us today which 
would empower States to proceed with innovative changes.
  To hasten approval of badly needed welfare reform, we in this 
Congress took a bold step toward meeting the President halfway when we 
separated welfare reform from the Medicaid reform bill that had 
threatened to doom both reforms.
  The time for action is long overdue. Our Nation's welfare system is 
in dire need of reform. America has spent $5.4 trillion on social 
welfare programs since the beginning of the ``War on Poverty'' in the 
1960's. Yet, the poverty rate has not decreased and the number of 
families on welfare has skyrocketed from 1.9 million in 1970 to 5 
million today. The sad history of welfare is one of three generations 
of people who have become trapped in a cycle of dependency. Since 1993 
alone, the number of single women who are heads of households in 
poverty has increased by 175,000 women.
  Frustrated by inaction at the Federal level, individual States have 
moved forward with their own reform proposals. Minnesota and Wisconsin, 
for example, have put together comprehensive welfare reform plans to 
move welfare recipients from welfare to work. A Minnesota Department of 
Human Services pilot project--the Minnesota Family Investment Plan 
[MFIP]--has resulted in reduced caseloads for the Aid to Families with 
Dependent Children [AFDC] program in the seven counties in which it 
operates. Minnesota would like to expand MFIP throughout the State as 
well as implement a number of additional pioneering measures recently 
passed by the State legislature.
  Wisconsin would like to implement ``Wisconsin Works,'' the welfare 
plan praised by President Clinton during his May 18 Saturday radio 
address as a ``sweeping welfare reform plan, one of [the] boldest yet 
attempted in America * * * We should get it done.''
  Unfortunately, since the President has twice vetoed welfare reform 
passed by Congress that would allow States to change the welfare system 
in ways which meet the needs of their residents, States must still go 
through an arduous special waiver process to enact their reform plans.
  But the President has yet to approve the waiver requests of Minnesota 
and Wisconsin. Minnesota submitted its waiver requests last March 28. 
According to the Minnesota Department of Human Services, it is critical 
these waivers be approved before the end of this month. And while the 
President said he would make the final decision on the Wisconsin waiver 
request by mid-July, he has yet to do so. I remain hopeful the 
President has truly had a change of heart and will approve both States' 
requests.
  It should be pointed out that the Clinton administration has granted 
several waivers to allow other States to implement similar proposals. 
But why should we approach this in a piecemeal, one-waiver-at-a-time 
fashion and waste valuable time and taxpayer dollars--time and money 
which could be better spent helping families and children escape the 
web of welfare dependency?
  How much longer can we continue to wait for the President to ``end 
welfare as we know it?'' How much longer will the President defend the 
welfare status quo and deny people in need and American taxpayers the 
opportunity for true reform?
  I believe the time is right to move beyond the piecemeal waiver 
process, put partisan politics aside and pass the comprehensive welfare 
reform legislation before us today.
  Madam Chairman, it's time to change the failed welfare system's 
vicious cycle of dependency.
  When this legislation is placed before the President again soon, we 
will find out if he has, indeed, really changed his position or if he 
will continue to fight to preserve the status quo. I hope the President 
will take the opportunity to support the Minnesota and Wisconsin 
plans--as well as proposals for the 48 other States--and sign the bill. 
Without national welfare reform for all 50 States, the cycle of poverty 
is destined to continue indefinitely.

                              {time}  1230

  Mr. SHAW. Madam Chairman, I yield myself 5 minutes.
  (Mr. SHAW asked and was given permission to revise and extend his 
remarks.)
  Mr. SHAW. Madam Chairman, today I think is a defining day in the 
history of this Congress. We are going straight at probably one of the 
biggest problems that we have in this country and something that I can 
only describe as a national disgrace.
  I respect every Member of this body, and I respect the great 
diversity all across this country. I respect the Governors of this 
country, and I respect the 50 States.
  But I would say to all of my colleagues, let us recognize that we 
have a failed welfare system in this country. Let us realize that at 
one time or another, every sitting Member of this Congress who has been 
here through the 104th Congress has at one time voted against the 
existing welfare system.
  What brings us together is that we all agree that the existing 
welfare system is not worth defending. We must change. We have got 
stagnation of population. We have tremendous problems out there that 
have been caused by a welfare system that the Congress procrastinated 
with, did nothing about, did not change. Now we are bringing forth 
change.
  Last year there was a Democrat substitute which took the vote of 
every Member on the minority side, and then there was a Republican bill 
that prevailed and went on to the President, and he vetoed it. It went 
to the President again and he vetoed it.
  What we are giving to the President today is another chance, another 
chance to deliver upon his promise to change welfare as we know it 
today.
  That is tremendously important. Those of you who vote for the Castle-
Tanner substitute which will be put forth by Mr. Gephardt at a later 
time today, you are saying you will have faith in the States and you 
are willing to send the programs back to the States and let them run 
it, and you are going to give them great latitude in designing it.
  I have great respect for the authors of that bill and what is in that 
bill. But can we do better? Yes, we can do better. We can do better by 
passing the bill that the Republicans have put forth, that has come to 
us from the Committee on Ways and Means.
  Why is that a better bill? One, it does not slash the earned income 
tax credit. I would like to read a provision from the Executive Office 
of the President in talking about the Republican bill when the 
Republicans were cutting EITC.
  He says the bill would still raise taxes on millions of working 
families by cutting the earned income tax credit. This is a letter 
written on July 16 to the gentleman from New York [Mr. Solomon]. At a 
later time I may put it into the Record.
  Now, when is a tax increase not a tax increase? To hear some of the 
Members come to the floor, they say it is not a tax increase when it is 
in the Democrat bill, but it is when it is in the Republican bill.

[[Page H7808]]

  Mr. Chairman, we took it out. We were criticized for it. We went back 
and looked at it and said, ``You are right,'' and we took it out and we 
are not going to put it back in. But it is in the substitute, in the 
one we are going to be asked to vote on later this evening.
  That is an important distinction for many of the Members on the 
Democrat side of the aisle. I respect that. I respect it so much that 
we took it out of our bill.
  What else have we done? The President said that Medicaid was a poison 
pill. We took it out of our bill.
  This is not an exercise in politics. This is a rescue mission by the 
Members of Congress to smash a corrupt system that has led to poverty 
across this country, has perpetuated it, and led to stagnation of 
people, an unforgivable sin, a stagnation of people within our inner 
cities all across this country who are paid to do nothing with there 
lives, paid not to get married, paid not to work, paid to have 
children, who then themselves turn around and go into the welfare 
system.
  This is a rescue mission. I respect every Member for wanting to 
change that system, but I would say that the best way to go is with the 
Republican bill. Vote against the substitute that will be offered by 
Mr. Gephardt.
  If you truly believe that noncitizens who are growing on our welfare 
rolls at a tremendous speed, if you believe they should still receive 
welfare, fine, vote for the Gephardt substitute. If you believe that 
welfare should truly not be time-limited, fine, vote for the 
substitute. But vote for something. That is what is very important.
  This I think is an historic moment. I think that the President will 
end up signing the bill that we will send him. It makes a lot of sense. 
It is a good bill.
  Mr. LEVIN. Madam Chairman, I yield myself 10 seconds.
  To the gentleman from Florida [Mr. Shaw], what we force Republicans 
to take out in the EITC change relating to rates, Democrats do not put 
back in period. That is a fib.
  Madam Chairman, I yield 2 minutes to the gentleman from California 
[Mr. Becerra].
  (Mr. BECERRA asked and was given permission to revise and extend his 
remarks.)
  Mr. BECERRA. Madam Chairman, I thank the gentleman for yielding me 
time.
  Let me begin by trying to dispel some myths and correct something 
that the chairman of the Subcommittee on Human Resources of the 
Committee on Ways and Means has just said. Legal immigrants are not 
over utilizing welfare, AFDC, for example. In fact, they use it as a 
lower rate than does the citizen population.
  What we find is a skew in the numbers because of the refugee 
population, which by definition comes without anything because they are 
escaping persecution. We have in the law a requirement that we try to 
aid them as they try to transition from a place they had to escape 
without bringing anything with them.
  We hear people say that we have to deny immigrants, legal immigrants, 
not undocumented, access to services for which they pay with their 
taxes, because in every respect they do what a citizen does. They must 
contribute in their taxes.
  We are saying here in this bill, ``Let's deny them services because 
they are coming in this country to get welfare.'' Absolutely not true. 
A respected, well-known research center, conservative research center 
which the Republican majority often uses, the Cato Institute, told us 
immigrants contribute about $285 billion to the economy, pay $70 
billion in taxes, and net, in other words, in excess, they contribute 
$25 billion more than they use in services from the government.
  Now, why do we hear all this talk? Because they cannot vote, they 
cannot hurt people who attack them, and they are an easy target, 
especially when we call them non-citizens. On behalf of my parents who 
were immigrants, on behalf of the over 1 million active and now veteran 
legal immigrants who served this country in time of war, and on behalf 
of the two Congressional Medal of Honor winners who served this 
country, both legal immigrants, that I can talk of, I say they do not 
come here to take, they come to give.
  The proof is in the pudding, and we should not attack a group just 
because it happens to be politically tenable to go after them, because 
they cannot go after us. It is unfortunate it is done. Let us have some 
decent debate on this and get meaningful welfare reform, but let us not 
attack folks trying to make this country better than what it is.
  Mr. SHAW. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, I would say to the gentleman in the well, we exempt 
veterans who are non-citizens.
  Madam Chairman, I yield the balance of my time back to the gentleman 
from Ohio [Mr. Kasich] and ask unanimous consent that he be allowed to 
control the remainder of the time.
  The CHAIRMAN. Is there objection to the request of the gentleman from 
Florida?
  There was no objection.
  Mr. KASICH. Madam Chairman, I yield 2 minutes to the very 
distinguished gentleman from Florida [Mr. Stearns].
  (Mr. STEARNS asked and was given permission to revise and extend his 
remarks.)
  Mr. STEARNS. Madam Chairman, I thank the distinguished chairman for 
yielding me time.
  Madam Chairman, Margaret Thatcher once said, ``Pennies do not come 
from heaven, they have to be earned here on earth.''
  For years we have asked the question, does increased social spending 
equate with a better childhood? Since 1960, the $5 trillion spent on 
social programs has increased at a rate above inflation. The simple 
answer, however, is that children are still suffering because the 
system is flawed.
  I would like to give, Madam Chairman, another quote. ``Work banishes 
those three great evils: Boredom, vice, and poverty.'' That came from 
the great philosopher, Voltaire. There is nothing wrong with work.
  Our plan increases funding for welfare. Now, we are going to hear on 
that side of the aisle that there are huge cuts that affect children, 
huge cuts that affect the underprivileged. But as Margaret Thatcher 
said and the philosopher Voltaire said, work does not hurt anyone.
  Yet, even notwithstanding that fact, if we look at this graph, we 
will see welfare spending will increase 31 percent. Spending will 
increase $137 billion under the House welfare reform plan. Clearly when 
we hear the President say there is not enough money, there is going to 
be plenty, ample amounts of money for their program.
  I would say to my colleagues on this side of the aisle, it is time we 
force the President to end this double talk on welfare and keep his 
promise to end welfare as we know it, correcting the inequalities that 
are in the system. This bill does it. The Republican bill does it, and 
it enforces the things that President Clinton talked about in his 1992 
campaign.
  So, by signing our bill, he has nothing to lose. Continuing to pour 
more money into the welfare system is not the answer.
  Mr. LEVIN. Madam Chairman, I yield 1 minute to the distinguished 
gentlewoman from New York [Mrs. Maloney].
  (Mrs. MALONEY asked and was given permission to revise and extend her 
remarks.)
  Mrs. MALONEY. Madam Chairman, the American people do not want to hurt 
children. The Republican bill is so removed from reality, it punishes 
children and penalizes working families. The bill would hurt millions 
of innocent children by making deep cuts in benefits, especially during 
economic downturns, by limiting the contingency fund to only $2 
billion. The Tanner-Castle substitute has an uncapped contingency fund 
for use during these troubling times.
  When we completely eliminate the Federal guarantee, those of us who 
have worked in city and State legislatures know that given the 
financial pressures, the poor will often fall through the cracks.
  This Republican bill just tells defenseless children, tough luck. 
This bill will not put people to work. CBO says that it needs $10 
billion more for the program, for their work program. It will put 
families with children out on the street. That is not welfare reform, 
it is a blueprint for disaster.
  Say yes to welfare reform, and no to this cruel and senseless bill.

[[Page H7809]]

  Mr. KASICH. Madam Chairman, I yield 2 minutes to the gentlewoman from 
North Carolina [Mrs. Myrick].
  Mrs. MYRICK. Madam Chairman, back home in Charlotte, we have many 
successes in moving people off of welfare--because we have created 
programs that work best for the folks in our community.
  As mayor of Charlotte, I worked closely with many people who found 
themselves needing the helping hand of welfare assistance.
  Many people on welfare are young, single mothers. In working with 
them, I learned what kind of help they need to become self-sufficient.
  Our bill will offer them exactly that form of help.
  It will restore power and flexibility to the States, confirming our 
commitment to send power, money, and influence back home--and finally 
get Washington bureaucrats out of the picture so we can design our own 
programs at home.
  It will help young mothers obtain jobs so they can feel good about 
themselves, and their kids can be proud of them.
  Child care is one of their major concerns. Our bill has specific 
provisions for child care assistance. I was a working mom and I know 
that it is difficult to go out in search of a better life when you have 
your kids to care for.
  It will also ensure that children receive nutritious meals at school 
through the school breakfast and lunch programs, as well as the special 
milk program.
  Our bill will offer protections, as well as assistance, by assuring 
that certain vulnerable people--such a pregnant women and people 
certified as physically or mentally unable to work--are exempt from the 
work requirement.
  In short, our bill makes sure that the needy are helped--and that 
those that can--help themselves.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentlewoman from New York [Mrs. Lowey].
  Mrs. LOWEY. Madam Chairman, I rise today in opposition to the 
Republican welfare bill and in support of the bipartisan alternative, 
the Castle-Tanner bill. We all agree that reform of our failed welfare 
system is long overdue. The system is failing both the taxpayers who 
fund it and the individuals that it is supposed to help.
  Welfare must be reformed to better reflect and reinforce our shared 
American values of work and responsibility, but, unfortunately, the 
Republican welfare bill does not reflect our values. It is just too 
tough on children and too weak on work.
  The American people want welfare reform to move Americans into the 
work force, not to punish children. This bill fails this fundamental 
test.

                              {time}  1245

  In reforming the welfare system, our focus must be on moving people 
into real jobs. Unfortunately, this bill will not move welfare 
recipients into the work force. It does not create a real incentive for 
the States to move people off welfare and on to jobs, and it does not 
improve access to education and training so that people have the skills 
they need to get a job.
  Quite simply, this bill imposes time limits without giving recipients 
the skills and education they need to find jobs before the time limits 
kick in. That is cruel and unfair. Real welfare reform should move 
recipients off the dole and on to jobs, not off the dole and on to the 
streets.
  The other major flaws in the Republican bill: The legislation 
prohibits Federal assistance from going to children if their parents 
reach the bill's time limit. That is wrong. We must not punish children 
for the failures of their parents.
  By contrast, the bipartisan Castle-Tanner bill requires States to 
provide help to children if their parents reach the time limit. Castle-
Tanner also preserves the nutritional safety net for our children 
instead of giving States the option to block grant food stamps.
  The Republican bill is also bad for New York. The Republican bill 
shifts Medicaid costs from the Federal Government to State and local 
governments, and we are going to lose $1.8 billion in Medicaid costs.
  Mr. KASICH. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from New York, the young Mr. Lazio.
  Mr. LAZIO of New York. Madam Chairman, I want to take a moment to 
express my deepest sorrow over the tragedy of TWA flight 800, which 
went down just last night off the shore of my own home on Long Island. 
Our thoughts and our prayers are with the families of the victims as 
they deal with their loss, and our gratitude goes to the rescuers 
throughout the country who are helping to recover important evidence.
  Today almost 1.5 million people in my home State of New York are 
receiving some sort of public assistance. That is a big number. And far 
too often that is exactly how these people are treated, as numbers to 
be fed into a broken welfare system, processed and pushed out again.
  The current system is inefficient, unfair and damaging to those it is 
supposed to help. Is this how we are supposed to show compassion? I 
think we can do better. This reform will replace our failed welfare 
system with one based on individual responsibility, accountability and 
hope for future generations.
  By destroying the work ethic and encouraging fathers to leave home, 
our current system results in broken families, a disintegration of 
moral standards and devastated communities.
  In contrast, these reforms would strengthen families, require able-
bodied recipients to work, attack fraud and abuse, and crack down on 
deadbeat parents. Most importantly, it provides hope for children by 
giving them the tools to break the cruel cycle of dependency. We will 
give them the incentive and tools to break out of the welfare trap that 
holds them down and limits their potential. By honoring work we allow 
people to assume responsibilities for themselves.
  By providing more funding, more funding for child care, we will 
provide them with the opportunity to provide a better life for their 
children and end the cycle of dependency that has resulted in families 
raising a fourth generation on public assistance.
  As a result of a welfare system that discourages two-parent families, 
today's illegitimacy rate among welfare families has continued to rise. 
This plan seeks to reverse this trend by increasing efforts to 
establish paternity and by demanding deadbeat fathers pay child 
support. Under the plan all mothers will be encouraged to identify the 
father of their children or face the risk of reduced benefits.
  Most importantly, this reform gives hope to our children, the most 
defenseless victims of our current system. The system fosters 
dependency, crime, violence and despair, yet somehow we expect children 
born and raised under these circumstances to be able to break the cycle 
of dependency. That is simply not fair.
  Madam Chairman, I am proud to support this bill. It moves us in the 
right direction.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from New York [Mr. Owens].
  (Mr. OWENS asked and was given permission to revise and extend his 
remarks.)
  Mr. OWENS. Madam Chairman, welfare reform is very much in order. The 
business of policymakers is reform. As legislators, the constant 
improvement of Government functions and programs is our job. Reform is 
a permanent, ongoing process. There is not a single Government program 
in existence that cannot use some reform. But reform should not be 
driven by manufactured hysteria and scapegoating. Welfare reform should 
not become the oppression and persecution of the poor.
  At the heart of the welfare program is the aid to families with 
dependent children. Children are the primary recipients. The survival 
and development of children is what aid to families with dependent 
children is all about. Children are our Nation's greatest resource, and 
the AFDC program is about the salvation of those children.
  Welfare reform can be accomplished without the kind of extremism and 
the persecution of the poor which is involved in the Republican reform 
bill.
  Put the problem in perspective. We are talking about 1 percent, 
approximately 1 percent, of the total Federal budget. There are many 
other subsidy programs we should be looking at which would cost us far 
more. The farm subsidy program, farmers home loan mortgages, and the 
subsidies to farmers not to grow grain or plant or plow

[[Page H7810]]

fields; those are very expensive subsidies.
  We give aid to people who are in earthquake zones, we give aid to 
people who are victims of hurricanes and floods. We have numerous 
places where we subsidize people.
  There are also other areas where there is definite waste in 
Government that we should take a hard look at.
  The CIA found they had $3 billion they did not know they had in a 
slush fund. The Federal Reserve Board has $3 billion for rainy days, 
and they have not had a rainy day in 79 years. So we have a lot of 
places to look for waste and improving Government and reforming 
Government. We do not have to persecute the poor in order to get rid of 
waste.
  AFDC is a program for children. It has been badly administered. It is 
not administered by poor people. we can improve the administration of 
it. We can find ways to improve it in many ways, but we should not 
persecute the poor. We should not persecute children in the process. 
This is about developing children, and we should be about the business 
of developing children.
  Mr. KASICH. Madam Chairman. I yield 2 minutes to the distinguished 
gentleman from the State of Arizona [Mr. Kolbe].
  Mr. KOLBE. Madam Chairman, I thank the gentleman for yielding me this 
time.
  Madam Chairman, we are able to come to the floor today and offer the 
American people a meaningful welfare reform proposal because of the 
work done by my colleagues Representatives Castle and Tanner. I have 
remained committed to changing the welfare system as we know it and 
worked with Representatives Castle and Tanner to continue the welfare 
debate. Their efforts continued the discussions between the majority 
and minority in the House, the administration, and the Governors to 
find a workable welfare compromise. I am pleased that the Republican 
majority have incorporated many of the suggestions included in the 
Castle-Tanner proposal. Therefore, I will join my fellow colleagues in 
support of H.R. 3734 as offered by the Republican majority.
  Madam Chairman, this bill answers the American people's demands to 
reform the current welfare program and addresses many of the concerns 
of the bipartisan Castle-Tanner group, the Governors and the 
administration. Over the past 18 months, this Congress has set out to 
truly reform the welfare program, and twice our efforts have been 
stopped by two Presidential vetoes.
  Madam Chairman, the American people recognize that the current 
welfare system is a failure. It traps welfare recipients in a cycle of 
dependency, and undermines the values of work and family that form the 
foundation of communities. The welfare state has created a world where 
children have no hope for tomorrow. Welfare cannot be a way of life for 
women and children. This bill provides women with the support to become 
working members of our society through the job training and child 
support programs.
  This bill restores power and flexibility to the States through the 
cash welfare and child care block grants. States will be given maximum 
flexibility to reform welfare, to develop income-support programs, and 
move families into the work force.
  We all agree the program must be changed, however some of my 
colleagues are saying the changes we are making is going to cut welfare 
programs, and that is simply untrue.
  Madam Chairman, over the last 6 years the Federal Government has 
spent over $441 billion on welfare programs. Through the next 6 years, 
through 2002 our welfare bill proposes to spend $578 billion. It is not 
cutting spending in the welfare bill that will be sent to the 
President, it increases it by $137 billion. This is not a cut to 
welfare. We should support this bill.
  This bill ends the long-term dependency of the welfare program and 
encourages self-sufficiency through imposing tougher work requirements. 
This bill guarantees that welfare becomes a helping hand and not a 
lifetime handout by imposing a 5-year lifetime limit for collecting 
AFDC. This bill is a common-sense effort to restore the basic values of 
work and restore the American dream for those currently in the welfare 
system.
  This bill restores power and flexibility to the States, confirming 
our commitment to give the decisionmaking, money, and influence back to 
the States and get Washington bureaucrats out of your pockets. Through 
the cash welfare and child care block grants States will be given the 
maximum flexibility to reform welfare, develop income-support programs, 
and move families into the work force.
  Washington's answers have not ended the war on poverty. We have found 
that the best welfare solutions come from those closet to the 
problems--not from bureaucrats in Washington. It is time to get the 
Washington bureaucrats out of the welfare system.
  We all agree the program must be changed, however, some of my 
colleagues are saying these changes will cut funding to welfare 
programs--this is completely untrue.
  Madame Chairman, over the last 6 years the Federal Government has 
spent $441.3 billion on welfare programs, including aid to families 
with dependent children [AFDC], child care, child support enforcement, 
food stamps, and child support.
  Over the next 6 years, through 2002, our welfare bill will spend 
$578.3 billion. Our bill is not cutting spending in the welfare bill 
that will be sent to the President. In actuality, over the next 6 
years, even after reform, welfare spending will increase by $137 
billion. Let me say this again, the Federal Government will spend an 
additional $137 billion on welfare over the next 6 years. This is not a 
funding cut to the welfare program.
  Madame Chairman, we are presenting to the President a meaningful 
welfare plan that incorporates changes requested by the governors and 
the bipartisan Castle-Tanner group. It is bipartisan effort and I urge 
my colleague to join me in supporting this welfare proposal and I 
encourage President Clinton to move beyond his words of support and 
sign our bill.
  Mr. SABO. Madam Chairman, how much time is remaining on both sides?
  The CHAIRMAN. The gentleman from Minnesota [Mr. Sabo] has 11\1/2\ 
minutes remaining, and the gentleman from Ohio [Mr. Kasich] has 7 
minutes remaining.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the gentlewoman from 
Connecticut [Ms. DeLauro].
  Ms. DeLAURO. Madam Chairman, today is a sad day for those of us who 
support real welfare reform. The Republican bill fails to meet the goal 
of moving people from the welfare dole to the working rolls. It fails 
to protect children from the ravages of stark poverty. This bill is 
tough on kids and weak on work.
  The American people want welfare reform that replaces dependency with 
the dignity that is earned from working for a living. At the same time 
the American people want us to protect innocent children who have no 
means to take care of themselves, and this bill moves in the opposite 
direction on both counts.
  The Republicans' Congressional Budget Office says that the Gingrich 
welfare plan underfunds the work program by $10 billion, by $10 
billion, making it impossible to take people from welfare to work. It 
builds in the failure of getting people to work.
  Under this bill's food stamp block grant plan more than 1 million 
children in this country could be forced into poverty. One million. It 
is outrageous. This bill is an unforgivable assault on our Nation's 
values and what we are about.
  Fortunately, today, we have a viable and a fair substitute, a 
bipartisan plan, Tanner-Castle, I repeat bipartisan, that puts people 
to work without throwing more kids into poverty. It has strong work 
requirements and the needed funds to make them work. It reforms AFDC 
and ends the cycle of dependency for welfare recipients and their 
families. It emphasizes the dignity of work over the punishment of 
children.
  We have precedent here. Last year the Republican leadership tried to 
drop 2 million children from the school lunch program. Now they are 
targeting kids again. It is wrong, and I call on my colleagues to 
reject it.
  We must not miss the opportunity today, it is an historic moment, to 
deliver real welfare reform that this country needs. Let us stand 
together for a bipartisan commonsense approach. Reject this failed 
agenda and support Tanner-Castle.
  Mr. KASICH. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from the State of Connecticut [Mr. Shays], a member of the 
Committee on the Budget.
  Mr. SHAYS. Madam Chairman, I thank my colleague for yielding me this 
time.
  Madam Chairman, this new Republican majority has three primary 
objectives: One is to balance our Federal

[[Page H7811]]

budget and to get our financial house in order; the second is to save 
our trust funds for future generations; and the third, and that is the 
one most involved with this effort today, we are trying to transform 
our caretaking social and corporate and welfare state into a caring 
opportunity society.
  There is nothing caring about our present welfare system. When I see 
my own communities, I see young children having babies, I see young 
children selling drugs, I see young children killing each other. In my 
communities there is nothing humane or caring about the system that we 
have. I see 24-year-olds who have never had a job, not because a job 
does not exist, because maybe it is a dead-end job, in their view. If I 
had ever said that to my dad, my dad would have doubled the amount of 
time I took that job.
  And 30-year-old grandparents. We basically have three generations of 
people on welfare. We have helped subsidize and create the very system 
we are trying to eliminate.
  Madam Chairman, I believe that child care and job training should be 
designed by the States, not the Federal Government. I believe child 
care and job training should be designed by local governments, not the 
Federal Government. I want to move power and money and influence out of 
this place and back to local communities, who know how to spend the 
money.
  Madam Chairman, I want to add to what the gentleman from Arizona [Mr. 
Kolbe] said: $441 billion for welfare up to $578 billion, an increase 
of $137 billion. Hardly a cut. We need to change the system, and this 
bill does it.
  I would conclude by saying that in the final analysis, it is not what 
we do for our children but what we have taught them to do for 
themselves that will help make them be successful human beings. We need 
to teach them how to grow the seeds, how to grow the seeds, not just 
hand them the food.
  This is a caring bill, and the sooner we pass it, the better.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentleman from Michigan [Mr. Dingell].
  (Mr. DINGELL asked and was given permission to revise and extend his 
remarks.)
  Mr. DINGELL. Madam Chairman, we must reform welfare. But as we work 
to reform welfare it is important to remember that we do not need to 
provide welfare assistance solely for altruistic reasons.
  We provide welfare assistance and financial assistance to those in 
need because it is in the best interest of our society to do so as we 
fit them for return to work and to membership in this society and in 
the productive units of this society.

                              {time}  1300

  Madam Chairman, work works. One of the highest priorities must be 
giving States and their residents the tools to find and keep good-
paying jobs. No Federal, State, or local government funds should be 
given to individuals without expecting something from those individuals 
in return. The purpose of welfare is to give financial lift to help 
people out of difficult times. Yet it must also provide them with the 
tools, training, education to support their families and to become 
productive parts of our work force.
  The Castle-Tanner bipartisan reform welfare program, of which I am 
proud cosponsor, provides the States with tools to reduce welfare rolls 
through education and training of recipients. I support this proposal 
for this reason, because it is the only version of welfare reform being 
considered today which will help Michiganians off welfare by providing 
the skills to achieve good jobs.
  Madam Chairman, we must care for the kids. Twenty-one percent of our 
children through no fault of their own are living in poverty. The 
Castle-Tanner bipartisan welfare reform will improve our welfare system 
so that abused children are protected. Neglected children get care, and 
hungry children will be fed. It will provide families with the support 
they need to care for their children while they move to become useful 
working components of our society. Without a guarantee for our children 
for food, shelter, and medical care, we will have a failure in this 
bill.
  The Republican bill fails by comparison. It does not take care of 
children. It does not take care of the hungry. It does not provide 
means for getting people back to work.
  I urge support of Castle-Tanner.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentlewoman from Texas [Ms. Jackson-Lee].
  (Ms. JACKSON-LEE of Texas asked and was given permission to revise 
and extend her remarks.)
  Ms. JACKSON-LEE of Texas. Madam Chairman, I thank the gentleman for 
yielding the time.
  I think that I really know America. I know an America that rose to 
help the victims in Oklahoma City. I know an America that rushed to the 
Midwest when floods overtook that community. I know an America that 
extended themselves to help those in hurricane-ridden Florida. And I 
know an America who stood on June 1, 100,000 strong and stood for our 
children.
  The Castle-Tanner bill is what we call real welfare reform. It fares 
well for Americans. We do not need a bill that cuts Americans who need 
some $60 billion, as the Republican bill does. We need a bill that has 
Americans who work hard and pay taxes joining us in saying that is 
fair. If you have a cutoff, then require the States to provide a bridge 
for those who may not yet be able to be independent after a 5- or 2-
year cutoff. Provide vouchers. If you cut Medicaid, allow families with 
children to still carry Medicaid. Excess shelter provision is needed, 
and the Castle-Tanner has that.
  Although we are in a climate of bashing hard-working immigrants, of 
which many of us came to this Nation in so many shapes and sizes, they 
pay taxes. They work. This provision in the Castle-Tanner bill allows 
for legal immigrants who have fallen on hard times, who cannot find 
work, to be able to be provided for.
  Yes, the Castle-Tanner bill does not increase the taxes of working 
poor, people who have made the decision that I would rather stand up 
and be counted in the work force but yet still need food stamps in 
order to carry the day for their children.
  I do not know about my colleagues, but the bill to pass today for 
real welfare reform that fares America well is the bill that supports 
our children. Why can we not do this in a bipartisan manner and stop 
the accusations? I am going to stand for the children of America and 
not cast aside those who are least able to serve.
  Please support the Castle-Tanner legislation.
  Mr. KASICH. Madam Chairman, I yield 1\1/2\ minutes to the 
distinguished gentleman from Arizona [Mr. Hayworth].
  Mr. HAYWORTH. Madam Chairman, I thank the chairman of the Committee 
on the Budget, my colleague from Ohio, for this time.
  Madam Chairman, she is called by an unlikely nickname, Pee Wee. Pee 
Wee Mestas of Holbrook, AZ, operates the Wayside Drive-in and offers a 
true spirit of compassion that goes beyond bromides to putting her 
philosophy and, yes, her faith in action. For, you see, Madam Chairman, 
Pee Wee Mestas, the operator of the Wayside Drive-in in Holbrook tries 
to do a gigantic job, not only providing for her family but trying to 
introduce the concept of work to young ladies in her hometown who have 
had children out of wedlock.
  Recently Pee Wee shared with me her frustration, for inevitably, Pee 
Wee says, when she offers jobs to these young ladies, they come and 
they work for a couple of weeks. But then invariably, and this is the 
sad fact, then invariably they say: Pee Wee, listen, I appreciate the 
opportunity to have this job, but, you see, the government will pay me 
more to stay home and do nothing.
  Madam Chairman, I respectfully submit that the issue is not about the 
care of children, for all of us in this Chamber truly care for 
children. The issue is teaching those mothers, those parents who have 
failed to take responsibility, they need responsibility, they need 
work. That is genuine compassion. Vote for the majority plan.
  Mr. SABO. Madam Chairman, I yield the balance of my time to the 
distinguished gentleman from Massachusetts [Mr. Neal] who has worked 
very hard on the issue of welfare reform.
  The CHAIRMAN. The gentleman from Massachusetts [Mr. Neal] is 
recognized for 5\1/2\ minutes.
  (Mr. NEAL of Massachusetts asked and was given permission to revise 
and extend his remarks.)

[[Page H7812]]

  Mr. NEAL of Massachusetts. Madam Chairman, there is a great verse 
from the old folksong that goes like this: When will we ever learn?
  Two years ago, one side in this institution learned that they would 
be unsuccessful in imposing their will on the other side when it came 
to the health care debate. And for the better part of 18 months, the 
majority in this House has failed to successfully pass welfare reform.
  The truth is, today, and Members will never hear them give any credit 
to this gentleman, but Bill Clinton forever changed the culture of the 
welfare debate in this country when he said we would end welfare as we 
currently know it.
  There is but one piece of legislation in front of this House today 
that commands the respect of Democrats and Republicans alike. That is 
the Castle-Tanner legislation. That is legislation based upon the hard-
won experience of the former Governor of Delaware and the distinguished 
gentleman from Tennessee, because they worked diligently to come up 
with a piece of legislation that Republicans and Democrats alike could 
support.
  No Member of this institution supports or defends the status quo when 
it comes to the current welfare system in America. We reject the notion 
that one out of three children being born out of wedlock in the long 
run ensures the social viability of this Nation. But as Al Smith used 
to say, let us take a look at the facts.
  Members will never hear it from the majority in this House, but today 
there are 1.3 million fewer welfare recipients across this Nation. Bill 
Clinton has granted 67 experiments in 40 States. Seventy-five percent 
of the welfare recipients in this country today are in work programs 
across this Nation.
  But let us not lose sight of this fact. I reject the suggestion of 
the previous speaker on the Republican side, when he said that this 
debate was not about children. There are 12.8 million AFDC recipients 
in America today; 8.8 million of those AFDC recipients are children.
  Despite the mistakes of parents who may well have been involved in 
antisocial behavior or, through no fault of their own, receiving 
welfare benefits, we ask ourselves today, what do we do about those 8.8 
million children? Is there anybody of the Jewish faith or the 
Protestant faith or the Catholic faith today or other faiths in this 
institution that would reject the instruction of those religious creeds 
and say that we have an obligation to those children to move them 
through this difficult time in their lives? Their only mistake was to 
be born into circumstances over which they had no control.
  But what is ironic about much of this debate today is that we have an 
opportunity in this Chamber to reject the status quo, to do it as 
Democrats and Republicans alike and, indeed, everybody would 
acknowledge how far the Democratic Party has moved during the last 18 
months on this issue.
  Do my colleagues know what else is extraordinary? As the Democratic 
Party has moved to the center in this debate, the Republican Party has 
moved more to the right. The goal of welfare reform has been elusive 
because there is an element on the other side that does not want to 
change in policy. They want a campaign issue for November. And the 
nominee of the Republican Party really had very little interest in 
coming to terms with a welfare bill that he knew that the President of 
the United States would sign.
  We have a chance in the next hours of this day to create a welfare 
bill that Republicans and Democrats can go home and point to as a 
tangible achievement and to remind the American people that the system 
really does work when there is an element of goodwill that governs our 
lives.
  The choice is relatively simple today. Will we vote for a piece of 
legislation that protects 8.8 million American children, or will we be 
caught up in a political issue for the fall?
  I would remind all that, again, it was Bill Clinton who changed the 
culture of the welfare debate in this country and has said repeatedly, 
if a good, sound welfare bill is put on his desk, he will sign that 
legislation. Do Members know what else is interesting? He has already 
stated he will sign the Castle-Tanner bill if put on his desk.
  We can accomplish that in the next few hours. Vote for Castle-Tanner 
and to welfare say farewell.
  Mr. KASICH. Madam Chairman, I yield myself the balance of my time.
  The CHAIRMAN. The gentleman from Ohio [Mr. Kasich] is recognized for 
3\1/2\ minutes.
  Mr. KASICH. Madam Chairman, I want to compliment the previous 
speaker. I think he did a pretty good job down here putting out his 
point of view, some of which I would agree with and some of which I 
would not. But I think he did a nice job with his remarks. I do want to 
say that when we look at what is happening in the House of 
Representatives, I said it this morning and have been saying it now for 
many months, the kind of change that we have seen in this House of 
Representatives is absolutely breathtaking.
  We have had a welfare system that did not have time limits, did not 
have good work requirements, did not have good incentives for people to 
go to work, did not have good training requirements.
  The American people are very smart. They knew we did not have a 
system that worked. I think the American people, because I am one of 
them, kind of grew up with the philosophy of Judeo-Christianity. We 
help people who need help and to teach people how to help themselves. 
That is the bottom line.
  Somebody may have something, may fall on hard times, we are there at 
the doorstep. But it gets old after awhile when those very same people 
who needed the help decide for whatever reason not to help themselves.
  What does this bill do? It says, look, you have got to go to work; 
you have got to get trained. You cannot be on welfare forever. If you 
are down and out, if you are down on your luck, if you need some help, 
if your kids are sick, if you are sick, we are going to help you.
  But at some point, in fairness to all those people, frankly, who are 
in this building today, who get up and go to work and pay their taxes, 
this is what they want. They want the time limits. They want the 
training requirements. They want the work requirements, and they want 
people to go to work.

                              {time}  1315

  And for those who can never go to work because they are just not 
capable, we are going to take care of them, but for the vast majority 
of Americans who want to work, we are going to fundamentally change the 
system.
  For those that wonder about this Congress, as my colleagues know, the 
President did make a campaign speech a couple years ago saying he was 
going to change welfare as we know it. He has vetoed two bills, third 
time is the charm, but he vetoed the two bills that we sent to him 
since this Republican Congress took control.
  Now, this is not braggadocio or partisanship. Frankly, it is the 
facts. The facts are the reason why we are debating fundamental welfare 
reform is because this Congress kept its word. The reason why people 
who go to work are going to feel better about the newly created welfare 
program is because we kept our word, and it is significant. The 
substitute that is being offered is a pretty positive substitute. Does 
not go far enough; it is too much, too much give, too much compromise, 
too much of the old system. But the compromise legislation ends the 
entitlement. It has work requirements. It has some form of time limits.
  Can my colleagues imagine, the Republicans and Democrats today in the 
House of Representatives are debating the most fundamental change in 
welfare since the program was created, and we are doing it because we 
want to help those people who are poor, we want to help those people 
who are disadvantaged get to work, and at the same time we are sticking 
up for the taxpayers in this country who go to work, who are willing to 
share their income with those who are less fortunate but who only ask 
that at some point in time those who are less fortunate get out and 
help themselves.
  I think this is a win-win today. I would defeat the substitute, I 
would pass the bill. Let us have real welfare reform, and I think at 
the end of the day the President signs it and this Congress will go 
down in history as the Congress that stood up for working people in 
America.

[[Page H7813]]

  Mr. NADLER. Madam Chairman, I rise in strong opposition to H.R. 3734, 
the Republican Welfare Reform Act being considered today on the House 
floor.
  This welfare reform bill is a direct assault on America's children, 
and on America's future. Most of the provisions of this bill would have 
their primary impact on low-income children. This bill would cut $61.1 
billion from vital family survival programs, denying benefits to 
millions of children who are in desperate need.
  This bill eliminates AFDC as an entitlement program, and creates a 
block grant to the States, denying the assurance of basic necessities 
to poor families and children when they are in need.
  The child care assistance provided in this bill is insufficient. How 
do the authors of this legislation expect low-income families to get 
off welfare if they can't even afford a safe, decent, place for their 
children to be cared for while they work? According to the CBO, this 
bill falls $800 million short of the costs of providing child care 
assistance to individuals required to work.
  Furthermore, the CBO has estimated that this bill would fall $12.9 
billion short of the funding necessary to meet the work program 
requirements in the bill. If we are to move families effectively toward 
financial independence, we must--before we remove a vital safety net--
provide the training necessary to perform jobs that will provide 
financial independence.
  Madam Chairman, the magnitude of cuts to and elimination of programs 
that provide children and families important protections is 
unprecedented. Not only does this bill take away the assurance of 
emergency assistance for the very poor, but it also reduces drastically 
funding for child nutrition programs and food stamps. More than half of 
all food stamp recipients are children, and this bill slashes food 
stamp spending by $28.4 billion over 6 years, putting many children in 
jeopardy of not receiving the nutrition they need.
  Madam Chairman, this bill is counter to the so-called family values 
about which there has been much discussion during the 104th Congress. 
If this really were a bill to promote and foster independence, it would 
focus on creating jobs and providing training, educational 
opportunities, and child care assistance. But instead, this 
legislation's focus is on removing basic assistance from children in 
dire need.
  Madam Chairman, I urge my colleagues to vote against this very 
damaging bill.
  Mr. SMITH of New Jersey. Madam Chairman, I would first like to 
commend Mr. Shaw and Mr. Archer, along with the other members of their 
respective committees, for once again forging legislation which will 
truly end welfare as we know it.
  Although we had previously passed welfare reform legislation on two 
separate occasions, Mr. Clinton, in failing to keep his promise to the 
American people twice vetoed our welfare bills. Madam Chairman, I am 
hopeful that once this monumental legislation is again passed and 
presented to the President, he will sign the bill this time, if for no 
other reason than it will be politically expedient for him to do so.
  As you are aware Madam Chairman, this welfare proposal includes a 
general rule which prohibits States from providing cash assistance 
under the family assistance block grant to a child born to a recipient 
of cash welfare benefits or who received cash benefits anytime during 
the pregnancy. This has been referred to as the ``family cap'' 
provision. However, the bill does permit States to opt out of this 
prohibition if a State passes legislation specifically exempting the 
State program funded under the family assistance block grant from 
application of the prohibition. I worked hard for this relief option 
and I am hopeful that most States will utilize it.
  For those States, however, that do not opt out, Madam Chairman, and 
in particular for the children of these States, I am pleased that the 
bill includes my amendment that permits States to provide vouchers for 
children born to families receiving assistance. I worked diligently to 
have this amendment included in our original welfare reform bill (H.R. 
1214 and H.R. 4), where it was passed overwhelmingly during 
consideration of that bill--352 to 80.
  I admit the original family cap-child exclusion had surface appeal to 
many Americans who are fed up with people being on the dole. Americans 
want the abuse of the system to end.
  However, the voucher-exception provision to the family cap will help 
the weakest and most vulnerable people in our society--children. I am 
sure everyone agrees that we must not punish children for the sins of 
their parents.
  My voucher-exception amendment now included in this legislation 
enables us to accomplish the goal of the family cap provision--i.e., 
discouraging out-of-wedlock pregnancies--without driving children 
further into poverty or forcing their mothers to have an abortion. My 
provision maintains the restriction on cash benefits, but allows 
vouchers to be used to pay for particular goods and services specified 
by the State as suitable for the care of the child involved.
  This means that State's will be able to provide for the most 
essential needs of the children: clothing, shoes, diapers, powders, 
bedding, laundry detergents, and travel to the doctor.
  Over the years numerous studies have shown that money--or more 
precisely the lack of it--heavily influences a woman's decision to 
abort her child. Without my amendment, we would be saying to mothers, 
``the State will not help you feed your child, but we will--as they do 
in many States--pay for you to destroy your child.''
  A major study by the Alan Guttmacher Institute, a research 
organization associated with Planned Parenthood, which performs or 
refers for 230,000 abortions a year found that 68 percent of women 
having abortions said they did so because ``they could not afford to 
have a child now.'' Among 21 percent of the total sample, this was the 
most important reason for the abortion; no other factor was cited more 
frequently as most important.
  The voucher-exception provision permits states to provide 
compassionate care for children--care which offers help to women who do 
not want to have abortions, or who may otherwise feel trapped by a 
State program that limits their ability to care for another child.
  Mr. PORTMAN. Madam Chairman, I rise in support of real welfare 
reform--something that is long, long overdue.
  The current welfare system is broken. It needs a major overhaul. No 
one can doubt the fact the war on poverty has failed--no one. We have 
spent over $5.4 trillion on welfare in the last generation, but, in the 
long term, the current system has more often harmed the very people it 
was designed to help.
  Madam Chairman, the welfare reform issue has been thoroughly and, I 
believe, thoughtfully studies and debated by this Congress. Remember, 
this marks the third time this session that this Congress will pass a 
welfare reform bill and sent it to the President.
  This new proposal is a fundamental change in the direction of our 
welfare system. It is the product of many, many hours of hearings and 
many sensible compromises. We are not, as some might have you believe, 
turning our backs on welfare recipients, nor should we. This bill 
continues to protect the children that are the most vulnerable people 
affected by our broken welfare system. It will continue to protect and 
to strengthen the role of families. But, it also protects our 
taxpayers. We're telling our taxpayers that, for now on, welfare will 
be a helping hand, not a handout.
  The new plan contains the major provisions I have worked for--work 
requirements, flexibility to allow States to address their own unique 
needs, and a 5-year time limit for those on welfare. My home State of 
Ohio has developed creative and innovative solutions closer to the real 
needs of people on welfare.
  I applaud Subcommittee Chairman Shaw, Chairman Archer, and Chairman 
Kasich for their leadership and urge my colleagues to support this 
bill. I think this bill is long overdue and urge the President to sign 
it.
  Ms. JACKSON-LEE of Texas. Madam Chairman, I rise today to speak out 
against a great injustice--an injustice that is being committed against 
our Nation's children--defenseless, nonvoting, children. I am referring 
of course to H.R. 3734, the Welfare Budget Reconciliation Act for 
fiscal year 1997.
  We speak so often in this House about family values and protecting 
children. At the same time however, my colleagues on the other side of 
the aisle, have presented a welfare reform bill that will effectively 
eliminate the Federal guarantee of assistance for poor children in this 
country for the first time in 60 years and will push millions more 
children into poverty.
  This partisan bill is anti-family and anti-child. The Republican bill 
continues to be weak on work and hard on families. Without adequate 
funding for education, training, child care and employment, most of our 
Nation's poor will be unable to avoid or escape the welfare trap. Even 
before the adoption of amendments increasing work in committee, the 
Congressional Budget Office [CBO] estimated that the Republican 
proposal is some $9 billion short of what would be needed in fiscal 
years 1999 through 2002 to provide adequate money for the States to 
carry out the work program. Furthermore, the increase in the minimum 
work hours requirement, without a commensurate increase in child care 
funding, will make it almost impossible for States to provide child 
care for families making the transition from welfare to work. True 
welfare reform can never be achieved and welfare dependency will never 
be broken, unless we provide adequate education, training, child care, 
and jobs that pay a living wage.
  I am also concerned about block grants in the bill which would 
eliminate any assurance of Federal funding for the prevention of child 
abuse. Child protection systems across the Nation are overwhelmed by 
the crisis facing families and their children. Federal, State and local 
efforts to prevent abuse have done little

[[Page H7814]]

to alleviate the problem. In its April, 1995 report on child abuse and 
neglect fatalities, the U.S. Advisory Board on Child Abuse and Neglect 
reported that almost 2,000 infants and young children die from abuse 
and neglect at the hands of parents and caretakers each year. The vast 
majority of these children were under age 5 when they died and 45 
percent were under the age of 1. It is critically important that child 
protection agencies increase their efforts to help children earlier in 
their lives. This bill does not go far enough to protect the Nation's 
children.
  Similarly, the proposed cuts in the Summer Food Program will 
seriously jeopardize the program's continued viability--threatening the 
health and well-being of the 2 million low-income children who rely on 
the program.
  More children will be hurt by the bill's denial of benefits to legal 
immigrants. The Republican bill would cut benefits for immigrants by 
about $19 billion and only 6 percent of these savings would come from 
denying benefits to illegal immigrants. Low-income legal immigrants 
would be denied aid provided under major programs such as SSI, Medicaid 
and food stamps. They would also be denied assistance under smaller 
programs such as meals-on-wheels to the homebound elderly and prenatal 
care for pregnant women. Under this bill, nearly half a million current 
elderly and disabled beneficiaries who are legal immigrants would be 
terminated from the SSI program. Similarly, the Congressional Budget 
Office estimates that by 2002, approximately 140,000 low-income legal 
immigrant children who would be eligible for Medicaid under current law 
would be denied it under this legislation. Most of these children are 
likely to have no other health insurance. I cannot believe we would 
pass legislation that would result in even one more child being denied 
health care that could prevent disease and illness.
  This bill also changes the guidelines under which nonimmigrant 
children qualify for benefits under the SSI program. As a result, the 
CBO estimates that by 2002, some 315,000 low-income disabled children 
who would qualify for benefits under current law would be denied SSI. 
This represents 22 percent of the children that would qualify under 
current law. The bill would reduce the total benefits the program 
provides to disabled children by more than $7 billion over 6 years.
  Madam Chairman, mandatory welfare-to-work programs can get parents 
off welfare and into jobs, but only if the program is well designed and 
is given the resources to be successful. The GOP bill is punitive and 
wrong-headed. It will not put people to work, it will put them on the 
street. Any restructuring of the welfare system must move people away 
from dependency toward self-sufficiency. Facilitating the transition 
off welfare requires job training, guaranteed child care and health 
insurance at an affordable price.
  We cannot expect to reduce our welfare rolls if we do not provide the 
women of this Nation the opportunity to better themselves and their 
families through job training and education, if we do not provide them 
with good quality child care and most importantly if we do not provide 
them with a job.
  Together, welfare programs make up the safety net that poor children 
and their families rely on in times of need. We must not allow the 
safety net to be shredded. We must keep our promises to the children of 
this Nation. We must ensure that in times of need they receive the 
health care, food, and general services they need to survive. I urge my 
colleagues to oppose this dangerous legislation and to live up to our 
moral responsibility to help the poor help themselves. Therefore, I 
support the Castle-Tanner welfare reform legislation which remedies 
many of these problems and fairly moves people from welfare to work.
  Mr. BUYER. Madam Chairman, in passing real welfare reform, thus 
ending welfare as millions know it, Congress is giving more hope, more 
opportunity, and more responsibility to families across America.
  Our current welfare system destroys lives by providing permanent aid 
to anyone. It creates poverty, dependence, hopelessness--repeated 
generation after generation in the same families. Some people are 
saddened that President Clinton vetoed real welfare reform not once but 
twice. I am more than saddened--I am angry. By keeping in place the 
same failed welfare policies of the past, the President has retained 
the status quo and denied the American Dream to millions of families. 
This is wrong. Government at the very least should not continue 
programs that hurt families and especially children. Welfare should be 
a helping hand in times of trouble, not a hand-out that becomes a way 
of life. I urge the President to not offer his veto a third time, but 
to provide his signature for the first time.
  The current welfare system subsidizes illegitimacy, destroys 
families, and promotes waste, fraud, and abuse. It is not a morally 
healthy environment when you have 12-year-olds having babies, 15-year-
olds killing each other, 17-year-olds dying of AIDS and 18-year-olds 
graduating with diplomas they cannot read. Welfare as we now know it is 
a system that keeps over a third of poor Americans locked in a 
seemingly endless cycle of destitution that has not stemmed a steady 
and growing epidemic of people living in poverty--14.5 percent of 
Americans in 1994.
  The debate surrounding welfare should not be centered around cost--
although the costs have been enormous over the years--but rather about 
principles such as purpose, dignity, and hope. Currently welfare 
consists of 80 Federal programs which provide cash payments, food, 
housing, and medical benefits. When created, it was thought that 
providing these handouts would allow individuals time in which to make 
the necessary changes in their lives to become a productive and self-
sufficient member of society.
  It is important to note that among industrialized nations at the 
start of this decade, the United States had the most murders, the worst 
schools, the most abortions, the highest infant mortality, the most 
illegitimacy, the most one-parent families, the most children in jail, 
and the most children on government aid.
  Many of our successes in fighting welfare have begun in communities 
and neighborhoods. There are a number of alternatives to Washington 
bureaucracy. Habitat for Humanity is one such example. While the 
Department of Housing and Urban Development [HUD] requires absolutely 
nothing from tenants, Habitat requires recipients to learn the 
responsibility of home ownership and requires them to build a home for 
someone else before they help build their own home. One works to foster 
responsibility while the other fosters only more dependence. HUD 
requires only taxpayer dollars while Habitat for Humanity requires hard 
work and commitment from the individual, the family and community 
volunteers and donations. One works, the other does not work.

  The 104th Congress has passed two dramatic welfare reform plans, only 
to see them end at the desk of President Clinton and his veto pen. The 
overriding messages of this bill are compassion, work, and 
responsibility. Our welfare reform plan includes:
  Deadbeat dads: This bill assures that children receive the support 
necessary by establishing State tracking procedures, promoting 
automation of child support procedures in every State, takes measures 
to establish paternity, and toughens child support collections.
  Work requirement: In 1979, 14 percent of welfare beneficiaries were 
working at paid jobs. By 1990, the number had dropped by one-half to 7 
percent. Today, fewer than 7 percent of AFDC recipients work. 
Approximately 4.7 million families currently are on AFDC and over 90 
percent will spend more than 2 years on welfare, and 77 percent will 
spend more than 5 years on welfare. This bill provides tough work 
requirements and enforces those work requirements. Able-bodied food 
stamp recipients between the age of 18 and 50 years with no dependents 
are required to either work 20 hours per week in a job or participate 
in a State work or training program within 120 days for receipt of 
benefits. It also gives incentives to reward States who are successful 
in moving families off welfare and into work. Work offers the best 
opportunity for long-term prosperity.
  Congress also worked with the Nation's Governors to assure single 
parents will be able to balance work with caring for their young 
children. At the Governors' requests, exceptions can be made at the 
State level to the lifetime 5-year benefits limit if a hardship exists. 
States must have 50 percent of welfare families working by 2002 or face 
losing Federal funds.
  Child care: This bill provides for child care to allow parents to 
receive proper training and education in pursuit of employment.
  Child nutrition: Child nutrition programs are streamlined to reduce 
costs without making cuts in school lunch, school breakfast or WIC 
programs.
  Food stamp program: Food stamps remain a Federal program but it 
requires able-bodied single adults to spend at least 20 hours a week in 
work-related activity or lose food-stamp benefits. In addition, it 
allows States to use one set of eligibility rules for families seeking 
cash welfare and food stamps.
  Supplemental security income: Denies SSI to prisoners, people who 
fraudulently receive SSI while in prison, people who receive SSI from 
two or more States, fugitive felons, and probation and parole 
violators.
  Provisions for noncitizens: Present law requires that when aliens 
come to the United States to live they must sign an affidavit that 
states they will not become dependent on the State, in other words they 
will get a job and become productive members of society. Unfortunately, 
many come to the United States, never become U.S. citizens, and receive 
assistance from taxpayers. This bill ends, 1 year after enactment, 
Medicaid and food stamps for most noncitizens now on the welfare rolls 
until they become citizens.

  This welfare reform plan is the first step to allow millions an 
opportunity at the American

[[Page H7815]]

Dream. Washington has finally come to the realization what our States 
and local communities have long known that dollars alone won't solve 
this problem.
  In changing welfare we must also change people's habits. If 
beneficiaries believe, as many currently do, that all they need to do 
is sign-up for benefits and wait for the check, then they have no 
incentive to find work. In contrast, if able bodies individuals know 
they only have 2 years to find a job, they will have to change their 
behavior and seek training that will lead to a job. By passing this 
bill we are extending our hand and offering real assistance, not just a 
handout but an opportunity for a new and better life. We are offering a 
way out of a system which has trapped adults and children for the past 
three decades.
  This welfare reform bill moves toward individual responsibility, work 
ethic, learning, and commitment. It allows individuals in their own 
communities to reach out and help their neighbors. It helps children, 
encourages families to stay together, puts people back to work and 
strengthens America's moral fiber. It returns the program to its 
original intent--a temporary helping hand for those most in need. In 
the end, it provides opportunities that do not currently exist for 
welfare beneficiaries to seek the American Dream with a sense of 
purpose, dignity, and hope.
  Mr. COYNE. Madam Chairman, in 1935 the Social Security Act became 
law. It established a commitment by the Federal Government to provide a 
guaranteed safety net for people who need assistance in making ends 
meet. The Republican welfare reform legislation currently being 
considered by the House of Representatives ends this 60-year commitment 
to poor families and leaves their economic fate to the vagaries of 
State politics. Further, this bill makes substantial cuts in the earned 
income tax credit [EITC], puts millions of children in jeopardy of 
losing their access to health care, and gives the States millions of 
Federal taxpayer dollars and provides inadequate Federal oversight to 
ensure that they will spend these funds wisely. For these reasons, I 
cannot support this legislation.
  The bill before us today will end the Federal guarantee of economic 
assistance for families in need. This means that individual States will 
determine who will be eligible for assistance and how to provide for 
these families with limited Federal dollars. Under this system, if you 
are poor and happen to live in New York, you may be eligible to receive 
welfare assistance, while if you are poor and happen to live in 
Mississippi, you may not be eligible to receive any assistance at all. 
This is hardly an equitable means of distributing Federal dollars. 
Eliminating the Federal commitment to the Nation's poor is something 
that I simply cannot support. Families in need of assistance should 
have somewhere to turn, regardless of the State in which they live.
  Under this legislation, many children who currently have access to 
health care services through the Medicaid Program may lose this 
critically important access. It is estimated that as many as 1 million 
children may lose their health care coverage under this legislation. 
This legislation will allow States to deny health care coverage to 
children who are currently receiving cash assistance but who will 
become ineligible for assistance under this bill. Not only will this 
legislation make many children ineligible for economic assistance, it 
will hit them twice by making them ineligible for health care services 
as well. At a time when the number of uninsured children is rising, it 
is unconscionable that we are considering legislation that will 
increase the number of uninsured children.
  It is ironic that the Republican majority has chosen to make the 
working poor pay for the costs of this bill through cuts to the EITC. 
This bill actually raises taxes on approximately 4.3 million working 
families earning between $17,000 and $29,000 per year by phrasing out 
the EITC more quickly. Instead of placing the burden of funding their 
welfare proposal on those who can best afford it, the Republican 
majority has chosen to place this burden squarely on the shoulders of 
those who can least afford it.
  During the Ways and Means Committee's consideration of this bill, the 
Democratic minority was assured that the cuts in the earned income tax 
credit would be balanced by a nonrefundable $500 per child tax credit. 
However, because this child tax credit is nonrefundable, millions of 
working poor families will not be eligible to receive the child credit 
because they do not earn enough income. Many families who are hurt by 
the cuts in the EITC will be ineligible to receive the child tax 
credit. Not surprisingly, the bill before us does not contain the $500 
per child tax credit but retains the devastating cuts to the EITC.
  This legislation sends a mixed message to welfare recipients. Under 
current law, States are prohibited from counting families' EITC 
payments in the calculation of their welfare eligibility and benefits. 
The legislation under consideration today will permit States to use 
EITC payments in these calculations. Individuals who are trying to make 
ends meet through paid work but who just don't make enough money to get 
by, face punishment by the State for their efforts. I offered an 
amendment during the Ways and Means Committee's markup of this 
legislation that would have required States to continue the current 
policy of disregarding EITC payments in welfare determinations, but it 
was defeated by the Republican majority. The EITC was established and 
has enjoyed bipartisan support because it rewards work--exactly what 
this bill is trying to accomplish--and so I do not understand why my 
Republican colleagues insist on allowing States to punish families who 
are genuinely trying to make work pay.
  I believe that individuals who can work and who can find a job should 
do so. I also believe that families who play by the rules should not be 
penalized for their inability to find work. This legislation does 
exactly that. By refusing to acknowledge that not everyone who 
currently receives welfare will be able to find a job that will provide 
a living wage, the Republican majority is setting up its welfare reform 
proposal to fail. It will fail because it will harm innocent children 
as well as their parents. The welfare reform bill before the House of 
Representatives contains provisions that will push more children into 
poverty--some estimate as many as 1.5 million--with little hope of ever 
getting out. The bill explicitly leaves open the possibility that 
children will suffer for the deeds of their parents and allows States 
to use children as pawns in influencing the behavior of their parents.
  The Republican majority, during markup of this legislation in the 
Ways and Means Committee, repeatedly refused to soften provisions in 
the bill that will undoubtedly hurt the children of individuals who 
cannot find work within the bill's arbitrary time limit. Under this 
legislation, States are prohibited from using Federal block grant funds 
to provide vouchers for the children whose parents who are cut off from 
cash assistance because of the time limit. This means that children 
will be punished because their parents cannot find work. I cannot 
support legislation with these effects on millions of our Nation's most 
vulnerable citizens.
  This bill grants States millions of Federal dollars and gives the 
Federal Government sorely inadequate oversight in return. Under this 
legislation, States must outline for the Department of Health and Human 
Services how they plan to meet the bill's requirements. However, the 
bill provides no organization, department or entity with the authority 
to ensure that States do what they say they are going to do. It will be 
exceedingly easy for States to submit fair and equitable plans to move 
individuals from welfare to work, yet fail to do so in practice. The 
Federal Government, although it will supply funding for the States' 
assistance programs, will have no recourse to protect beneficiaries 
from the failure of the States to act fairly.
  The Republican majority is again placing before the House of 
Representatives legislation that is part of a partisan political 
agenda. They know as well as I do that President Clinton's welfare 
reform efforts have already yielded substantial results. They know that 
the President has granted 67 welfare waivers to 40 States to allow them 
to experiment with different types of welfare-to-work strategies. They 
know that welfare rolls are down by nearly 10 percent since President 
Bush left office--that represents nearly 1.3 million fewer individuals 
receiving welfare checks each month. They know that teen pregnancy 
rates are down in 30 of the 41 States that report such rates. In the 
face of these statistics, I do not understand the Republican majority's 
uncalled-for attempt to bring radical and punitive change to the 
Nation's 60-year-old safety net for the poor.
  The bill before us today ends the Federal guarantee of assistance to 
poor families. It punishes children for the deeds of their parents and 
will almost surely force millions more children into poverty and 
deprive them of health care.
  Welfare reform does not need to be punitive. It does not need to end 
the responsibility of the Federal Government for the economic well-
being of its citizens. The Republican majority's brand of welfare 
reform does little to address existing barriers to economic self 
sufficiency: inadequate education and training opportunities, 
unaffordable health care, inadequate child care and a dearth of viable 
job opportunities. Instead, the Republican majority has chosen again to 
continue its agenda of pursuing policies that injure our Nation's most 
defenseless citizens while doing little to reduce the pernicious 
effects of poverty.
  Mr. REED. Madam Chairman, I believe it is vital that we pass a 
meaningful welfare reform bill. Meaningful welfare reform should move 
individuals to work and instill individual responsibility, while 
ensuring that children are protected.
  The Republican bill debated today, just like the one vetoed by the 
President last year, does not pass these essential tests. In fact, the 
Republican bill fails to provide sufficient

[[Page H7816]]

funding to move welfare recipients to work; does not provide adequate 
resources for States and individuals in the event of a severe 
recession; and unduly and unnecessarily harms children. The Republican 
bill can be summed up as weak on work and tough on children.
  I support the Castle-Tanner alternative which is a tough, balanced, 
and bipartisan welfare reform bill that can be signed into law if the 
Republicans would let it reach the President's desk. Castle-Tanner 
contains the funding States need to put people to work according to the 
Congressional Budget Office. In addition, Castle-Tanner contains time 
limits for welfare benefits, guarantees protections for children, 
requires State accountability in operating welfare programs, and 
improves the response to economic downturns.
  In my State of Rhode Island, a coalition of State officials, business 
leaders, and anti-poverty groups are currently working out the final 
details of a compromise welfare reform package. Unlike the Republican 
bill which would jeopardize this Rhode Island welfare reform effort, 
Castle-Tanner compliments it by providing the necessary resources and 
flexibility to move Rhode Island welfare recipients into work.
  I urge my colleagues to support the Castle-Tanner substitute. Castle-
Tanner is the only bill offered today that will provide the funding, 
flexibility, and protections necessary to create a reformed welfare 
system that promotes work. Castle-Tanner is responsible and meaningful 
welfare reform and it is a better bill for both Rhode Island and 
America.
  Mr. DURBIN. Madam Chairman, I rise in support of welfare reform.
  The current welfare system is in desperate need of reform. For public 
aid recipients trapped in the system, for those who exploit the welfare 
system, and for the taxpayers who foot the bills, an overhaul of 
welfare in America is a high priority.
  The fundamental problem with our current system is that for many 
people welfare becomes more than a helping hand; it becomes a way of 
life. For some who enroll in the primary welfare program, Aid to 
Families with Dependent Children [AFDC], welfare becomes a trap they 
cannot escape. Some are afraid to lose the health benefits they receive 
through Medicaid. Others are unable to secure child care to enable them 
to go to work. We must eliminate these barriers and chart a clear path 
for welfare recipients to go after a paycheck instead of a welfare 
check. Welfare should be viewed as temporary assistance, not a 
lifestyle.
  I believe welfare benefits should be cut off for recipients who are 
unwilling to pursue work, education or training. I also believe we must 
strengthen child support enforcement. Billions of dollars in child 
support payments go uncollected each year. By establishing paternity at 
birth and pursuing deadbeat parents, we can reduce the number of 
families that are impoverished by the failure of non-custodial parents 
to fulfill their financial obligations.
  Today the House of Representatives is considering two proposals--the 
Gingrich bill and a bipartisan proposal offered by Representatives 
Castle and Tanner. The bipartisan Castle-Tanner welfare reform bill is 
dramatically better than the Gingrich bill.
  The bipartisan bill will move people form welfare to work. It 
provides sufficient funding for work programs, and provides needed 
child care assistance for mothers who will be required to work and for 
working poor families.
  The bipartisan bill protects children. It requires States to provide 
vouchers for the children of families who are removed from welfare 
before they reach the 5-year time limit, and it gives States the option 
of providing vouchers for children of families who exceed the 5-year 
limit. It allows families to continue their Medicaid coverage if they 
lose welfare benefits because of a time limit. And it continues the 
eligibility of the children of legal immigrants for SSI and food 
stamps.
  In contrast, the Gingrich welfare bill is weak on work and tough on 
children. It cuts resources for programs that move people from welfare 
to work, potentially leaving States with a $9 billion deficit over 6 
years. It discourages work by reducing the Earned Income Tax Credit, 
which has the effect of raising taxes on more than 4 million poor 
working families. It makes deep cuts in food stamps, endangering the 
nutrition of millions of children and elderly Americans. It denies food 
assistance to more than 300,000 children simply because they or their 
parents are immigrants. It does not ensure Medicaid eligibility when 
States change their welfare rules, endangering the health of millions 
of poor families. And it fails to ensure that child support orders are 
updated regularly to reflect the growing income of the non-custodial 
parent.
  I still have significant problems with parts of the Castle-Tanner 
bill, particularly provisions relating to legal immigrants. Legal 
immigrants play by the rules and contribute to the progress of our 
country, just as all of our ancestors have done. I support effective 
requirements on the sponsors of legal immigrants who apply for 
benefits, but I do not believe that people who live legally in our 
country should be treated unfairly.
  I am supporting Castle-Tanner in the hope that bipartisan welfare 
reform will become a reality this year. But before I support sending a 
measure to the President, I hope that the House-Senate conference 
committee addresses the serious flaws in the House effort.
  Mr. RICHARDSON. Madam Chairman, I oppose this closed rule which 
prohibits this House from taking a vote on issues critical to Native 
American tribes.
  Yesterday, I testified before the committee on two amendments 
important for the safety and futures of American Indian children. My 
amendments would have restored the current set-aside level for tribes 
under the Child Care Block Grant and made tribes eligible for Title IV-
E adoption and foster care assistance funds.
  I am disappointed that the Congress will not have an opportunity to 
vote on these important issues.
  Because of my particular concern about the Title IV-E adoption 
assistance and foster care program, I will be introducing legislation 
to make Indian children eligible for this assistance. I strongly 
believe this is an issue that this Congress on obligation to vote on 
whether it is a part of welfare reform or a free standing bill.
  Mr. HORN. Madam Chairman, after the billions of taxpayer dollars 
spent to end poverty, why do the welfare rolls continue to grow?
  Why can't we do better than the welfare system we have in place right 
now?
  How many more families will be trapped in the current welfare system 
before Congress and the President finally act?
  Isn't it time that the President lived up to his campaign promise to 
``end welfare as we know it?''
  And, isn't it time for Congress to act?
  These are the questions that America wants answered. I urge my 
colleagues to provide those answers by voting for welfare reform today.
  Mr. COSTELLO. Madam Chairman, I rise in opposition to the welfare 
reform plan presented to this House today. This plan is another mean-
spirited attack on the most vulnerable citizens in our society, who 
have been asked to endure huge cuts in programs to pay for tax cuts for 
the very wealthy. In the interest of scoring political points, the 
leadership of this House has offered to send the President a bill that 
begs to be vetoed. This bill should not go forward.
  I fully believe our welfare reform system is in dire need of reform. 
For too long, it has fostered dependence and not provided the resources 
or incentive for work. However, I cannot in good conscience support a 
bill that as a policy turns its back on poor and needy children. This 
bill eliminates the Federal safety net of Medicaid and food stamps for 
many kids, and cuts millions of dollars by denying Supplemental 
Security Income [SSI] assistance to the poor and disabled. And, by 
mandating that individuals work without providing adequate employment 
resources and child assistance, this bill threatens the health and 
safety of thousands of children who now rely on their parents care. 
This legislation is now responsible reform, and the real losers under 
this bill are the 1 million children who will be pushed into poverty 
under this so-called reform.
  I urge my colleagues to support the Castle-Tanner substitute, which 
represents a modest compromise that will protect children while 
reforming our welfare system. The Castle-Tanner proposal guarantees 
protections for children and provides the support necessary for 
individuals to move into work. Castle-Tanner is serious about moving 
individuals from welfare to work. It imposes work requirements within 2 
years of receiving assistance and ends subsidies after 5 years. It does 
not however, end food or medical assistance to children whose parents 
no longer qualify. Further, the Castle-Tanner substitute holds fathers 
responsible for their children through strong child support 
enforcement.
  Castle-Tanner provides States with broad flexibility to develop 
successful welfare programs based on the needs of local communities. 
However, unlike the Republican bill, the Castle-Tanner compromise does 
not allow States to shirk their responsibilities to provide for their 
citizens. Under Castle-Tanner, States must continue to spend a 
reasonable and responsible amount of State dollars on assistance 
programs. Successful welfare reform must be a thoughtful joint 
partnership between the States and the Federal Government.
  Madam Chairman, we have a responsibility to pass meaningful reform in 
this House. We cannot abuse this responsibility by passing legislation 
that will hurt thousands of children. I urge my colleagues to defeat 
the Republican bill and pass the bipartisan Castle-Tanner substitute, 
so that we can achieve meaningful, lasting welfare reform that 
President Clinton can sign into law.
  Mrs. COLLINS of Illinois. Madam Chairman, welfare as we know it 
today, had its roots in

[[Page H7817]]

American society almost 75 years ago. It is challenging to observe what 
the public and private sectors are doing to support children and 
families in the transition from welfare to work to self-sufficiency. 
Congress has the important role of providing a national view and in 
assuring that national priorities are addressed at the State and local 
levels of service administration and delivery. Many families need help 
to transition from public assistance, known as welfare, to self-
sufficiency. We, as the national representatives of our society, must 
help build bridges and extend ladders to support parents and families 
as they move from welfare to work to self-sufficiency.
  Work, responsibility, empowerment, and self-sufficiency should be the 
hallmarks of this welfare reform debate. The Republican philosophy is 
simply to get people off the public payrolls, with no attention to or 
concern about what these families will do when they face the challenges 
that may be inevitable for many of them. The best plan is one which 
must not come about at the expense of the children, and which will help 
people make the difficult transition from welfare to work. That's the 
real test of welfare reform.
  There are five basic principles that must be considered in any 
welfare reform effort: Welfare reform must protect children. Their 
well-being must be our top priority; parents must take responsibility 
for their families, personally, emotionally, and financially; it is 
critically important to empower young people to reduce teen pregnancy 
and out-of-wedlock childbirth; quality child care is an issue that must 
be addressed and provided; and there must be access to quality health 
care.
  We, as Federal legislators, must assure that the children are 
protected. They must not be required to pay for either the mistakes of 
their parents nor for the failures of our educational or private, 
corporate system that has left too many parents without adequate life 
and work skills to be self-sufficient. Reform ought not be just a race 
to save money by kicking needy families off welfare. Instead, our 
emphasis must be on enabling and empowering, not punishing parents and 
families--a true profamily agenda. Workable welfare reform legislation 
has to have not only real requirements for work, but also for job 
training, counseling, and personal as well as financial support.
  One positive approach is based on a simple compact: Job training, job 
contracts, child care and child support enforcement to transition 
people to work; plus time limits on cash assistance to ensure parents' 
self-sufficiency so that welfare is not a way of life. Most people will 
find jobs in the private sector, but for those who do not, we should 
take the money which would have been spent on welfare checks and use it 
to find a subsidized job, preferably within the private sector. Merely 
passing the problem back to the States with reduced resources is not 
the answer. Job skill for real work is the answer.


                       child support collections

  It is my belief that both parents should be required to support their 
children. Child support enforcement is an integral part of real welfare 
reform. For example, we have to develop and implement a multipronged 
approach to increasing child support collections. Therefore, paternity 
should be required to be established in the hospital, at the birth of 
the child, if at all possible, and without penalizing the mothers. I'd 
like to see a Federal law requiring uniform State laws which will 
prevent parents from evading their responsibilities by crossing State 
lines. This would require centralized registries and new hire reporting 
procedures or a national employment registry, which could be the IRS.
  There are over 19 States that are using professional license 
suspension or revocation as a method to enforce child support payments. 
The threat of taking away driving, professional, and other work-related 
licenses works. The Congressional Budget Office has estimated that the 
Federal Government could save over $146 million in welfare payments in 
the first 5 years as a result of a nationwide license revocation or 
suspension program. Therefore, it is reasonable to predict that just 
one major child support enforcement proposal would help boost child 
support collections to $20 billion by the year 2000.


                       teen pregnancy and poverty

  The link between teen births and poverty is clear: 80 percent of the 
children born to teenage parents who dropped out of high school and did 
not marry are poor. That contrasts to only 8 percent of children born 
to married high school graduates over 20. Simply denying AFDC benefits 
to a teenage mother, as the original Republican plan proposed, won't do 
anything to move her family toward self-sufficiency. It's mean-spirited 
and makes the children pay the price. This approach will lead to more 
dependency, not less. One solution is possible when there is a stable 
functional home environment: Require teen mothers to live at home with 
their parents, identify their child's father, finish high school, learn 
parenting skills and work. Welfare reform efforts must be flexible.


                               child care

  There are welfare reform experiments in place that have been testing 
various ways we can use requirements to move from welfare to self-
sufficiency. All of them stress work and responsibility. When we talk 
about empowering families to move from welfare to self-sufficiency we 
must also talk about child care. Child care support is particularly 
critical for low-income parents because it is such a significant part 
of a low-income family's budget. On average, poor working families pay 
more than a quarter of their income on child care.
  The child care development block grant signed into law by President 
Bush with bipartisan support has made a significant contribution to 
low-income working families. In 1993, 65 percent of the children served 
were in families with incomes at or below the poverty line. Real 
welfare reform requires more child care, not less. The original 
Republican plan would reduce Federal funding for child care by $1.6 
billion, or 15 percent over 5 years, and yet it kicks mothers off 
welfare after 2 years. This is hypocritical. That would mean 320,000 
fewer children would be served by the year 2000. That means working 
families would be pitted against welfare recipients for scarce child 
care assistance. That's not the way to reform welfare and move families 
to self-sufficiency.
  Recent studies have shown that children from low-income families are 
more likely to be in low-quality centers. The child care development 
and block grants have been instrumental in raising the standards for 
child care programs. We need to focus not only on safe, nurturing 
environments for children while their parents work and go to school, 
but also on the quality of the developmental and educational 
environment for the children's benefit; and, we must continue to expand 
child care opportunities to help working parents stay out of the 
welfare system, and for parents on welfare to transition off.
  In summary: Work, responsibility, and empowerment are the keys to 
helping people make the transition from welfare to self-sufficiency. 
Budget cutting is not welfare reform. Supporting parents to develop 
self-sufficiency is. Putting people to work is. With continue advocacy, 
we can make the changes that are necessary. We can establish and 
maintain the bridges from welfare to self-sufficiency for families. I 
have recently learned a startling statistic prepared by The Brookings 
Institution. A chart showing change in adjusted real personal income 
demonstrated that the top levels of income increased from 30 to 40 
percent over the last two decades. The middle incomes saw a modest 
increase in adjusted real personal income; however, the lowest levels 
of income saw a dramatic decline of down to a 30-percent decrease. From 
a plus 40-percent increase for the very wealthy to a 30-percent 
decrease for the very poor, and the Dole-Gingrich Republicans want to 
decrease welfare.
  I cannot help but wonder whether the Dole-Gingrich Republicans even 
know who the welfare recipients are. Well, let me put a face on them. 
They are the single mom who dropped out of high school as a pregnant 
teenager, who was abused by adults as a child and abused by her spouse 
or partner as an adult. She receives a pittance in Aid to Families with 
Dependent Children [AFDC] and an allotment for food stamps. She can't 
get a midlevel paying job because she has no skills. Even if she could 
get a low paying job--where the competition is tough--there aren't any 
health care benefits; and after she pays for babysitting and 
transportation she is hard pressed to pay the rent. And heaven forbid 
if the kids get sick--she can't afford medical care.
  Will the Dole-Gingrich Republicans give her a job? Will they help 
support jobs training programs so she can develop some employable 
skill? Not in this original bill. That mom and her kids make up the 
largest population of welfare recipients. The next large population 
group that the Federal Government subsidizes with welfare are the 
disabled--and the eligibility is that they cannot hold a job. Will the 
Dole-Gingrich Republicans employ that person with disabilities? Or will 
they support training programs or funding to assist an employer with 
providing any adaptive or assistive equipment that would make most 
persons with disabilities employable. Their record of little compassion 
and understanding for the least fortunate doesn't indicate that they 
will.
  Madam Chairman, I stand for responsible government, for responsible 
parents, and for a responsible and responsive private sector. We all 
must join together to achieve reform of a system that can benefit all 
sectors by enabling all families to be proud and self-sufficient.
  While I do not agree with several of the provisions of the Castle-
Tanner substitute it is better than the Republican bill.
  Ms. BROWN of Florida. Madam Chairman, I rise in opposition to the 
Republican welfare reform proposal. Instead of solving the welfare 
problems in this country, this bill creates new ones. By relying on 
block grants to distribute

[[Page H7818]]

money to States, the neediest and most vulnerable people of this 
country could be left out in the cold.
  Sending money in the form of block grants is a virtual guarantee that 
rapid growth States like Florida will either have to make up for the 
loss of money on their own--or deny assistance to the neediest families 
in their jurisdiction. We need to balance this country's budget in a 
way that holds everyone responsible--not just the poor and the needy.
  By cutting the earned-income tax credit, the Republicans are simply 
punishing low-income working families. And by getting rid of job 
training programs, the Republicans are eliminating the chance that 
welfare recipients will have the necessary skills to get a job.
  The Republican proposal is a mean-spirited attempt to punish those 
who are already suffering.
  Ms. ESHOO. Madam Chairman, I rise in opposition to this bill and in 
strong support of the Tanner-Castle substitute for welfare reform.
  The Tanner-Castle proposal is sounder policy for our country and 
reforms a broken system by focusing on two critical elements: It 
protects children and it promotes and assures work.
  The Tanner-Castle proposal differs from H.R. 3734 in several other 
important areas: It provides $3 billion in mandatory resources for work 
programs; it requires vouchers for the needs of children during the 5-
year time limit for benefits; enough mandatory funding is provided for 
child care for all welfare recipients; local governments are allowed 
greater participation in the process of setting up programs in their 
areas that meet the needs of their citizens; it includes an open ended 
contingency fund for States to access in the event of an economic 
recession; it requires a greater annual commitment by the States for 
welfare programs; it provides food stamp benefits for the children of 
legal immigrants.
  These are not differences that negate the reforms of the welfare 
system that my Republican colleagues are seeking. The provisions I have 
listed ensure that when we make these reforms we are improving the 
current system while maintaining a safety net for those who need it. 
Change for the sake of change is not good enough unless there is a 
regard for the impact it will have.
  Madam Chairman, the Tanner-Castle legislation meets the test that 
those who are in the system are given the assistance they need to move 
from welfare to work. H.R. 3734 does not.
  Our country must have a sound, workable, and fair welfare reform 
policy. H.R. 3734 is tough on kids and weak on work. More than 1 
million children could be pushed into poverty and in 70 percent of 
these families, one of the parents is working. The bill makes it less 
likely that child support orders will be updated regularly--actually 
weakening current law on deadbeat parents--while increasing Federal 
costs. I urge my colleagues to support the Tanner-Castle substitute and 
oppose the underlying bill.
  Mrs. VUCANOVICH. Madam Chairman, in the board game called life, there 
is no welfare square that keeps your game piece there indefinitely. 
Instead, there is hope, opportunity to go to college, to go to work, to 
get married and have a family, to be a success and win the game. We 
teach these values to our children through the games that they play, 
yet our Government over the years has changed the values for our 
children to live by.
  Today on the House floor we are not playing a game. Today we are 
taking a step, hopefully with the President's support, to restore our 
American values and reform the welfare system so that welfare is no 
longer a way of life. We can offer our citizens and children a chance--
a chance to work, a chance to go to school, and a chance to be a 
success and win the real game of life.
  H.R. 3734 promotes work and helps mothers on welfare by providing the 
job training and child care they need to achieve this goal. This bill 
says no more handouts to prisoners and noncitizens who have imposed on 
our system, and reduced opportunities for those who truly deserve 
assistance.
  In addition, this bill restores power and flexibility of the welfare 
program to the States. You and I both know that Washington bureaucrats 
do not know what is best for Nevadans--most of them have not even been 
to the Silver State to learn what Nevadans need and what challenges 
must be faced. The best solutions can come from those who know us best, 
our own State government. To help our States, the bill provides 
appropriate funding and additional funding opportunities for those 
States, like Nevada, with growing populations.

  Lastly, and I find most importantly, the bill encourages 
responsibility of families to reduce illegitimacy rates and to have 
parents take financial responsibility for their children. Today's 
illegitimacy rate among welfare families is almost 50 percent and is 
expected to rise. This bill takes bold steps to establish paternity and 
to make fathers pay child support. These are tough provisions, and it 
is about time that the Federal Government helps States track down 
parents who are unwilling to take care of their own family members. You 
see, Madam Chairman, this is not a game--the 104th Congress means 
business.
  H.R. 3734 helps our future by helping our children. Our children will 
be our leaders someday and we must instill in them the values we grew 
up with. Responsibility for family, hope to go to college or have a 
good job, dreams to be a success--they are not not just squares on a 
board game, but are attainable goals in the real game of life. H.R. 
3437 is a first step in making these goals become a reality, and I 
encourage my colleagues to support this legislation, and urge the 
President's to sign this essential bill for our children.
  Mr. RICHARDSON. Madam Chairman, I am committed to reforming our 
failing welfare system. Our Nation needs a welfare reform that gives 
people back the dignity and control that comes from work and 
independence.
  Our current system pays cash assistance when people lack adequate 
means to provide for their families rather than providing them with the 
means to support themselves.
  My voting record reflects what I want to see in a welfare reform 
bill.
  I believe that welfare should be a temporary program that provides a 
safety net for people who fall on hard times. I have voted for a 
program that limits persons to a 5-year lifetime limit for welfare 
assistance.
  I believe that able-bodied adults with no children should not be 
eligible for food stamp benefits if they are not working at least part 
time.
  I also believe that welfare recipients must be aggressively looking 
for a job. I have voted for legislation which terminates a persons 
benefits if they refused to work, to accept a job, or refused to look 
for work. If a job is not available, welfare recipients should be put 
in community service jobs.
  Central to the welfare debate are our children. I believe that people 
should not have children until they are able to support them. I support 
provisions which reduce benefits for teen parents who fail to maintain 
minimum performance in school and denies teen parents assistance unless 
they are living with a parent or responsible adult.
  Additionally, I believe that parents--both parents--have 
responsibilities to support their children. I have voted for 
legislation which withholds paychecks for parents who do not pay child 
support.
  At the same time we are holding parents responsible for their 
children, we should not punish a child whose parents fail. We have a 
moral obligation to provide that no child goes hungry, is denied needed 
medical care, or is left with inadequate supervision.
  Welfare reform must include child care moneys for people entering the 
work force with small children.
  I also believe a welfare reform plan should give people access to the 
training they need, but expect them to work in return. I am 
disappointed that H.R. 3734 has no provisions to move people into the 
work force.
  Madam Chairman, I am ready to make welfare reform a reality. Welfare 
reform must be tough on work, but fair to children.
  Mr. CLAY. Madam Chairman, I rise to oppose this partisan and 
politically motivated welfare bill that would push 1 million more 
children into poverty.
  Were it not for the fact that many have exploited this issue for raw 
political purposes, perhaps we could reform a welfare system badly in 
need of revision.
  Were it not for the fact that those promoting an agenda of slashing 
domestic assistance programs to finance unfair economic priorities, 
perhaps real welfare reform could be achieved. Were it not for the fact 
that the Republican majority in this House is willing to exploit the 
condition of our Nation's poor in a desperate attempt to resuscitate 
their extreme and failed agenda, perhaps a proposal could be framed 
that fostered realistic work requirements and compassionate safety 
nets.
  Rather than exhausting my time objecting to the most reprehensible 
provisions of this Republican plan, let me focus on some of the things 
that must be contained in any welfare reform bill I can support in good 
conscience:
  First, welfare reform must contain realistic work requirements, not 
harsh punitive measures devised to appeal to a crazed, cynical, public 
scapegoating of the poor. Most welfare recipients want what is best for 
themselves and their families. They want fulfilling jobs that pay a 
livable wage. But when those clamoring for workfare oppose adequate 
resources for job training, and education, their sincerity is called 
into question. When those championing workfare in place of welfare show 
no concern that jobs are available which pay decent wages, welfare 
reform is an empty vessel.
  Second, welfare reform must ensure that parents seeking to stay off 
welfare are able to leave their children in safe and healthy child care 
settings. Without adequate child care funding, welfare reform is a 
bizarre notion.
  Third, welfare reform must ensure that the poor are protected against 
hunger and illness.

[[Page H7819]]

There must be an adequate contingency funding to shelter the poor 
against recessions. Adequate food stamps must be available for poor 
families so they don't starve, and, Medicaid must be preserved to 
protect welfare recipients from the range of health risks that threaten 
the medical well-being of the poor and the elderly.

  Welfare reform must preserve critical Federal efforts to protect 
children from abuse and neglect. It must not be used as a vehicle for 
reckless experimentation with those protections.
  Madam Chairman, we have a solemn responsibility to address the 
Nation's problems with logical, compassionate legislation. The 
Republican welfare bill before us has little to do with logic, 
compassion or the reform of welfare.
  I urge my colleagues to reject this misnamed, misdirected bill that 
espouses unrealistic, inhumane expectations. The architects of this 
flawed plan are willing to inflict suffering and misery on children. 
Their bill speaks volumes about the warped morality of those who would 
let children and the elderly starve.
  Madam Chairman, the mere consideration of this trashy legislation 
evidence that this Congress and the American people who insist on this 
perversion of decency have lost all sense of purpose. This assault on 
the poor is driven by dishonesty and deception. It constitutes a 
reckless abandonment of humane values.
  I urge its defeat.
  Mr. BEREUTER. Madam Chairman, this Member is pleased to support 
welfare reform legislation currently before the House for 
consideration.
  This Member has been a long-time supporter of efforts to reform our 
current welfare system to ensure that only those who are unable to 
provide their own basic needs receive assistance.
  Enactment of a strong welfare reform measure that places an emphasis 
on work as its centerpiece is long overdue. The Congressional Budget 
Office has estimated that 1.3 million families now on welfare will be 
working in fiscal year 2002 as a result of the enactment of this 
legislation which converts welfare into a work program.
  President Clinton promised to end welfare as we know it during his 
1992 Presidential campaign. The President should be true to his initial 
instincts and campaign promise and sign this much needed welfare reform 
measure. The President's prior two vetoes of welfare reform 
legislation represented another broken promise to the American people 
for they were consistent with what the President requested. This Member 
is hopeful that speedy action will be taken to enact this welfare 
reform bill. It provides a compassionate solution for a failed welfare 
system.

  However, this Member is concerned that once again, the President by 
his rhetoric in the past week, is laying the groundwork to reverse his 
course, violate his own statements, and again veto strong welfare 
reform legislation. It seems that Marian Wright Edelman will oppose any 
welfare reform bill that is worthy of reform. It would seem that as 
long as Marian Wright Edelman is opposed to this welfare reform bill, 
Mrs. Clinton will oppose it, and the President will veto this 
legislation and every welfare reform bill that is worthy of being 
called a reform bill.
  For millions of poor Americans trapped in a system of despair, this 
measure offers them hope to escape the welfare cycle. It does that by 
replacing our current welfare bureaucracy with reforms based on the 
dignity and necessity of work for the able-bodied, and on the strength 
of families. States are also granted maximum flexibility to help needy 
individuals achieve self-reliance.
  In addition, this important legislation ensures that absent parents 
are not allowed to walk away from their moral and financial 
responsibility to care for their children. Deadbeat parents currently 
compound the Nation's welfare problems, causing millions of children to 
live in poverty.
  Madam Chairman, this Member urges his colleagues to support this 
strong welfare reform measure which ensures that the system of 
something for nothing is ended, and to require that welfare recipients 
meet reasonable and responsible standards.
  Mr. KLECZKA. Madam Chairman, I rise in support of the welfare 
proposal put forth by the majority today.
  I commend my colleagues on their decision to remove the poison pill 
of Medicaid from this bill.
  And I commend my colleagues for the substantial steps they have taken 
to address the President's concerns, and the concerns of my Democratic 
colleagues.
  This new bill ensures the continuation of health care coverage for 
those no longer eligible for AFDC. It deletes the unwarranted 
reductions to the earned income tax credit that were included in the 
original bill. And, it adds in $3 billion in work program funding.
  No piece of legislation is perfect; this one is no exception. We know 
full well that we will revisit this issue repeatedly as problems arise.
  I would have preferred to see more Federal funding for job placement 
and training, for child care, and for protection during recessions.
  I would have preferred to increase State flexibility by giving States 
the option to use Federal funds to provide vouchers for children whose 
parents hit the time limits, rather than removing the protection of 
those vouchers by including a mandate against them.
  I have fought, unsuccessfully, for stronger nondisplacement language 
so that America's workers can be assured that their jobs won't be put 
in jeopardy. This omission still concerns me.
  However, this legislation is a solid start.
  It gives our States the tools and the flexibility they need to enact 
meaningful, constructive reform.
  A reform based upon personal responsibility, and personal 
achievement. A reform that moves people into the work force--
permanently.
  Congress must put aside partisan differences and pass this plan--to 
reform and revitalize our welfare system.
  Ms. PELOSI. Madam Chairman, we can all agree that the welfare status 
quo is unacceptable. But the Republican welfare reform proposal will 
make the problems of poverty and dependence much worse because it 
refuses to make work the cornerstone of welfare reform.
  Real welfare reform is about work. Opportunities for work, jobs that 
pay a living wage, job training opportunities to provide skills 
necessary to earn a living wage are long-term solutions for a permanent 
and productive reform in our welfare system.
  Real welfare reform must emphasize the importance of work. Real 
welfare reform must also aid rather than punish children. Fourteen 
million children live in poverty in the United States. Passage of this 
legislation would add millions more to that statistic. This welfare 
bill is punitive and unrealistic.
  Abolishing the safety net for children, imposing family caps, denying 
legal immigrants benefits, imposing arbitrary time limits, and failing 
to provide adequate child care, health care, education, job training, 
and work opportunities for people in need will thrust millions more 
into poverty.
  This bill cuts almost $60 billion from the poor in this country. 
These cuts will affect children whose parents are on welfare. These 
cuts will trap countless women in abusive relationships, with nowhere 
to turn--without a realistic way to gain independence, gain work, and 
provide for their children.
  Welfare reform must be about education, job training, and work. We 
must keep families together, rather than ripping them apart. We cannot 
simply reduce the deficit at the cost of our poorest Americans. This 
proposal has little wisdom, conscience, or heart.
  Some of my colleagues will vote for this bill and then wash their 
hands of welfare reform, saying they have done their job. But the job 
of welfare reform is more complex and dire. People living in poverty 
are not cardboard cutouts--they do not have the same stories, they do 
not need the same services. This bill treats everyone alike--with 
unrealistic time limits and no real, lasting, and effective plan to 
move welfare recipients to work at a living wage.
  The denial of benefits to legal immigrants in this legislation will 
do great harm to children and have a devastative impact on the health 
care system in our country. Only 3.9 percent of immigrants, who come to 
the United States to join their families or to work, rely on public 
assistance, compared to 4.2 percent of native-born citizens. According 
to the Urban Institute, immigrants pay $25 billion more annually than 
they receive in benefits. Yet the myth persists that welfare benefits 
are the primary purpose for immigration to the United States. Instead 
of appreciating legal immigrants for their significant contributions to 
this, their adopted country, this bill blatantly punishes them, 
especially young children and the elderly. It bans SSI and food stamps 
for virtually all legal immigrants. It tosses aside people who pay 
taxes, serve our country, and play by the rules. This lacks compassion 
and common sense.
  If we want to achieve real welfare reform, we need to offer some 
long-term solutions to help people move up and out from the cycle of 
poverty.
  The current welfare system is not adequate, but this bill makes it 
far worse. I urge my colleagues to oppose the Republican bill and work 
together for meaningful reform that puts people to work and pulls them 
out of poverty for good.
  Mr. SERRANO. Madam Chairman, I rise in emphatic opposition to the 
Republicans' welfare reform bill. I am tempted to simply repeat the 
remarks I made last year, on the so-called Personal Responsibility Act, 
since the flaws in this bill are remarkably similar. But I do have a 
few new things to say.
  It is clear to all thinking people that our current welfare system 
fails the people it is meant to help, and every Member of this House, 
Democrat as well as Republican, has voted for

[[Page H7820]]

some form of welfare reform in the last 2 years. But the Republicans' 
approach will make the situation of the poor--and of the charities that 
help them and the cities that contain them--much worse.
  The clearest sign that this bill is totally misguided is that it 
saves so much money. Everyone knows it takes more spending, not less, 
to give poor mothers the tools they need to get and keep jobs and to 
escape poverty. They need education, training, job-search assistance, 
day care and health care for their children, and jobs--and that means 
jobs that don't displace others.
  Cost is the main reason Congress has been slow to face welfare reform 
in the past. But this bill cuts the programs that sustain our neediest 
families. It slashes the safety net for the poorest children and 
families.
  And, Madam Chairman, it is incomprehensible to me that we have now 
reached a point where not one of the proposals before the House today 
preserves the entitlement--the guarantee that some modest assistance 
will be there for those families whose desperate circumstances make 
them eligible. What recourse will these wretched families have?
  A very, very big problem with this bill is how it treats our 
children. No child chooses to be born into a poor family, but an eighth 
of the country's children now receive some support from the welfare 
system, and the Republican bill will push more than 1 million 
additional children into poverty.
  But, Madam Chairman, I want to concentrate on provisions related to 
immigrants and public assistance. The immigrant provisions in this 
bill--and, sadly, in the otherwise superior Castle-Tanner substitute--
are a disgrace, and an absolute bar to my supporting either bill.
  The United States is a nation of immigrants. That is a cliche 
precisely because it is true. We all have roots beyond the borders of 
the United States; we all have ancestors, as near as our parents or as 
remote as our many-times-great grandparents, who, willingly or not, 
came to America.
  We know that immigrants don't come for public assistance; they come 
to join family members and to provide a better life for their children. 
They work, they pay taxes, they participate in their schools and 
churches and communities, and they play by the rules. Why should they 
be targeted by this bill? Why should fully half the savings in this 
bill be achieved on the backs of legal immigrants who are in trouble or 
who wish to better themselves?
  I can think of only one reason. For the past several years, this 
country has seen a rising tide of antiimmigrant feeling, whipped up by 
public officials who find naming scapegoats easier than dealing with 
the real problems facing their constituents. If the economy turns down, 
why, it must be immigrants. If schools are crowded, immigrants must be 
the reason. Crime? Immigrants. Deficits? Immigrants. Strange languages 
on the subway? Immigrants.
  The assault is broad and comprehensive. it may begin with legitimate 
concerns over control of our Nation's borders, but it quickly moves 
to encompass those immigrants who have done everything we have asked of 
them--and more--to qualify for the rights to live here, work and pay 
taxes, and become Americans.

  The antiterrorism bill has already made long-term immigrants with 
deep roots in America suddenly subject to detention and deportation for 
long-ago, mostly minor brushes with the law.
  The immigration bill--supposed to deal with control of our borders 
and enforcement of our employment eligibility laws--included provisions 
to deny citizens and legal residents the right to reunite their 
families in America.
  Both the immigration bill and this bill would go way beyond enforcing 
sponsors' obligations to support the immigrants they bring to this 
country. Instead, they would make it impossible for our society to meet 
its moral obligations to help people in trouble. It would also deny 
immigrants the ability to better themselves through education and 
training.
  Funds for bilingual education are slashed, even as some Members of 
this House would impose English-only policies on government. Bilingual 
ballots and voting assistance are under attack, when even life-long 
English speakers think they need law degrees to understand some of the 
propositions that appear on our ballots.
  Madam Chairman, one thing that disturbs me very much is that this 
assault seems to be related to changes in the ethnicity of many recent 
immigrants. This suggests that ethnic discrimination is likely to rise. 
If immigrants are singled out as the class of people who are not worthy 
of, or entitled to, assistance available to citizens, those who look or 
sound foreign are at risk of extra scrutiny. You may recall reports 
that, after proposition 187 passed in California, Hispanics' rights to 
buy a pizza were questioned. People who look like you, Madam Chairman, 
are unlikely to be asked, but increasingly, people who look like me are 
being questioned about our immigration status. This is illegal, 
undemocratic, unfair, but increasingly real.
  Madam Chairman, I could go on, but I will close by urging all of my 
colleagues to reject the Republicans' ugly, mean-spirited welfare 
reform bill. It is simply too far off course. We need to return to 
basic principles and start all over again if welfare reform is to 
result in a welfare system that is compassionate, workable, and, above 
all, fair.
  Mr. JOHNSON of South Dakota. Madam Chairman, I rise today in 
reluctant support of H.R. 3734 so that we may move forward with needed 
welfare reform in this country. While I preferred the bipartisan 
approach taken in the amendment by Mr. Castle and Mr. Tanner, which 
gives States more flexibility to develop and implement workfare 
programs, it is paramount that we no longer accept the status quo. The 
provisions in H.R. 3734 are much improved compared to H.R. 4 of last 
year, which I could not support and was also vetoed by the President. 
It is too late in the congressional session to start over, and my vote 
for H.R. 3734 is a vote to keep the debate and the possibility of a 
bipartisan agreement on welfare reform alive.
  The welfare reform bill which passed the House today was an 
improvement over H.R. 4 because it does the following: First, deletes 
the elimination of Medicaid changes that threatened access to medical 
care for the most vulnerable in our country; second, deletes the block 
granting of the child nutrition program; third, adds resources for 
child care above the level in previous bills; fourth, includes a work 
performance bonus that gives States an incentive to move people from 
welfare to work; and fifth, preserves funding for foster care and 
adoption assistance programs.
  There are several things that I believe must and will be improved via 
Senate and conference committee action on this legislation. Among 
these, I believe we simply must further ensure that children who happen 
to have been born into difficult circumstances do not go hungry. 
Punishing innocent children is not a solution nor should it even be an 
option. We must require States to protect children if their parents are 
removed from the welfare rolls.
  As this bill moves to conference, it is my judgment that we must 
address the concerns raised recently by the National Governors 
Association regarding the restrictions on State flexibility and 
unfunded costs in the work requirements of H.R. 3734. The Congressional 
Budget Office has concluded that most States would fail to meet the 
work requirements and that most would simply accept the penalties 
rather than implement the requirements for work. The most important 
reform we can enact in the welfare system is to move people to self-
sufficiency. We must not fail in that regard and therefore I am hopeful 
that this bill is improved in conference to ensure adequate resources 
to States to implement solid work requirements.
  We must ensure that no families lose health care coverage when States 
change AFDC rules. Even though the Medicaid reconciliation provisions 
have been removed, we need to guarantee that families do not lose 
health care coverage even if they are removed from welfare rolls.
  Madam Chairman, our Nation demands that we reform our welfare system. 
This legislation moves a long way toward needed reform, but it can 
still be better. I offer my reluctant support and hope that the Senate 
and the conference committee address my concerns and make this bill the 
best that it can possibly be.
  The CHAIRMAN. All time for debate pursuant to House Resolution 482 
has expired.
  Pursuant to the rule, an amendment in the nature of a substitute 
consisting of the text of H.R. 3829, modified by the amendment printed 
in part 1 of House Report 104-686 is adopted. The bill, as amended, 
shall be considered as an original bill for the purpose for further 
amendment and is considered read.
  The text of the amendment in the nature of a substitute, as modified, 
is as follows:

                               H.R. 3829

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Welfare Reform 
     Reconciliation Act of 1996''.

     SEC. 2. TABLE OF TITLES.

       The table of titles of this Act is as follows:

Title I--Committee on Agriculture
Title II--Committee on Commerce
Title III--Committee on Economic and Educational Opportunities
Title IV--Committee on Ways and Means
                   TITLE I--COMMITTEE ON AGRICULTURE

     SEC. 1001. SHORT TITLE.

       This title may be cited as the ``Food Stamp Reform and 
     Commodity Distribution Act of 1996''.

     SEC. 1002. TABLE OF CONTENTS.

       The table of contents of this title is as follows:


[[Page H7821]]


Sec. 1001. Short title.
Sec. 1002. Table of contents.

                     Subtitle A--Food Stamp Program

Sec. 1011. Definition of certification period.
Sec. 1012. Definition of coupon.
Sec. 1013. Treatment of children living at home.
Sec. 1014. Optional additional criteria for separate household 
              determinations.
Sec. 1015. Adjustment of thrifty food plan.
Sec. 1016. Definition of homeless individual.
Sec. 1017. State option for eligibility standards.
Sec. 1018. Earnings of students.
Sec. 1019. Energy assistance.
Sec. 1020. Deductions from income.
Sec. 1021. Vehicle allowance.
Sec. 1022. Vendor payments for transitional housing counted as income.
Sec. 1023. Doubled penalties for violating food stamp program 
              requirements.
Sec. 1024. Disqualification of convicted individuals.
Sec. 1025. Disqualification.
Sec. 1026. Caretaker exemption.
Sec. 1027. Employment and training.
Sec. 1028. Comparable treatment for disqualification.
Sec. 1029. Disqualification for receipt of multiple food stamp 
              benefits.
Sec. 1030. Disqualification of fleeing felons.
Sec. 1031. Cooperation with child support agencies.
Sec. 1032. Disqualification relating to child support arrears.
Sec. 1033. Work requirement.
Sec. 1034. Encourage electronic benefit transfer systems.
Sec. 1035. Value of minimum allotment.
Sec. 1036. Benefits on recertification.
Sec. 1037. Optional combined allotment for expedited households.
Sec. 1038. Failure to comply with other means-tested public assistance 
              programs.
Sec. 1039. Allotments for households residing in centers.
Sec. 1040. Condition precedent for approval of retail food stores and 
              wholesale food concerns.
Sec. 1041. Authority to establish authorization periods.
Sec. 1042. Information for verifying eligibility for authorization.
Sec. 1043. Waiting period for stores that fail to meet authorization 
              criteria.
Sec. 1044. Operation of food stamp offices.
Sec. 1045. State employee and training standards.
Sec. 1046. Exchange of law enforcement information.
Sec. 1047. Expedited coupon service.
Sec. 1048. Withdrawing fair hearing requests.
Sec. 1049. Income, eligibility, and immigration status verification 
              systems.
Sec. 1050. Disqualification of retailers who intentionally submit 
              falsified applications.
Sec. 1051. Disqualification of retailers who are disqualified under the 
              WIC program.
Sec. 1052. Collection of overissuances.
Sec. 1053. Authority to suspend stores violating program requirements 
              pending administrative and judicial review.
Sec. 1054. Expanded criminal forfeiture for violations.
Sec. 1055. Limitation of Federal match.
Sec. 1056. Standards for administration.
Sec. 1057. Work supplementation or support program.
Sec. 1058. Waiver authority.
Sec. 1059. Response to waivers.
Sec. 1060. Employment initiatives program.
Sec. 1061. Reauthorization.
Sec. 1062. Simplified food stamp program.
Sec. 1063. State food assistance block grant.
Sec. 1064. A study of the use of food stamps to purchase vitamins and 
              minerals.
Sec. 1065. Investigations.
Sec. 1066. Food stamp eligibility.
Sec. 1067. Report by the Secretary.
Sec. 1068. Deficit reduction.

              Subtitle B--Commodity Distribution Programs

Sec. 1071. Emergency food assistance program.
Sec. 1072. Food bank demonstration project.
Sec. 1073. Hunger prevention programs.
Sec. 1074. Report on entitlement commodity processing.

            Subtitle C--Electronic Benefit Transfer Systems

Sec. 1091. Provisions to encourage electronic benefit transfer systems.
                     Subtitle A--Food Stamp Program

     SEC. 1011. DEFINITION OF CERTIFICATION PERIOD.

       Section 3(c) of the Food Stamp Act of 1977 (7 U.S.C. 
     2012(c)) is amended by striking ``Except as provided'' and 
     all that follows and inserting the following: ``The 
     certification period shall not exceed 12 months, except that 
     the certification period may be up to 24 months if all adult 
     household members are elderly or disabled. A State agency 
     shall have at least 1 contact with each certified household 
     every 12 months.''.

     SEC. 1012. DEFINITION OF COUPON.

       Section 3(d) of the Food Stamp Act of 1977 (7 U.S.C. 
     2012(d)) is amended by striking ``or type of certificate'' 
     and inserting ``type of certificate, authorization card, cash 
     or check issued in lieu of a coupon, or an access device, 
     including an electronic benefit transfer card or personal 
     identification number,''.

     SEC. 1013. TREATMENT OF CHILDREN LIVING AT HOME.

       The second sentence of section 3(i) of the Food Stamp Act 
     of 1977 (7 U.S.C. 2012(i)) is amended by striking ``(who are 
     not themselves parents living with their children or married 
     and living with their spouses)''.

     SEC. 1014. OPTIONAL ADDITIONAL CRITERIA FOR SEPARATE 
                   HOUSEHOLD DETERMINATIONS.

       Section 3(i) of the Food Stamp Act of 1977 (7 U.S.C. 
     2012(i)) is amended by inserting after the third sentence the 
     following: ``Notwithstanding the preceding sentences, a State 
     may establish criteria that prescribe when individuals who 
     live together, and who would be allowed to participate as 
     separate households under the preceding sentences, shall be 
     considered a single household, without regard to the common 
     purchase of food and preparation of meals.''.

     SEC. 1015. ADJUSTMENT OF THRIFTY FOOD PLAN.

       The second sentence of section 3(o) of the Food Stamp Act 
     of 1977 (7 U.S.C. 2012(o)) is amended--
       (1) by striking ``shall (1) make'' and inserting the 
     following: ``shall--
       ``(1) make'';
       (2) by striking ``scale, (2) make'' and inserting ``scale;
       ``(2) make'';
       (3) by striking ``Alaska, (3) make'' and inserting the 
     following: ``Alaska;
       ``(3) make''; and
       (4) by striking ``Columbia, (4) through'' and all that 
     follows through the end of the subsection and inserting the 
     following: ``Columbia; and
       ``(4) on October 1, 1996, and each October 1 thereafter, 
     adjust the cost of the diet to reflect the cost of the diet, 
     in the preceding June, and round the result to the nearest 
     lower dollar increment for each household size, except that 
     on October 1, 1996, the Secretary may not reduce the cost 
     of the diet in effect on September 30, 1996.''.

     SEC. 1016. DEFINITION OF HOMELESS INDIVIDUAL.

       Section 3(s)(2)(C) of the Food Stamp Act of 1977 (7 U.S.C. 
     2012(s)(2)(C)) is amended by inserting ``for not more than 90 
     days'' after ``temporary accommodation''.

     SEC. 1017. STATE OPTION FOR ELIGIBILITY STANDARDS.

       Section 5(b) of the Food Stamp Act of 1977 (7 U.S.C. 
     2014(d)) is amended by striking ``(b) The Secretary'' and 
     inserting the following:
       ``(b) Eligibility Standards.--Except as otherwise provided 
     in this Act, the Secretary''.

     SEC. 1018. EARNINGS OF STUDENTS.

       Section 5(d)(7) of the Food Stamp Act of 1977 (7 U.S.C. 
     2014(d)(7)) is amended by striking ``21'' and inserting 
     ``19''.

     SEC. 1019. ENERGY ASSISTANCE.

       (a) In General.--Section 5(d) of the Food Stamp Act of 1977 
     (7 U.S.C. 2014(d)) is amended by striking paragraph (11) and 
     inserting the following: ``(11) a 1-time payment or allowance 
     made under a Federal or State law for the costs of 
     weatherization or emergency repair or replacement of an 
     unsafe or inoperative furnace or other heating or cooling 
     device,''.
       (b) Conforming Amendments.--
       (1) Section 5(k) of the Act (7 U.S.C. 2014(k)) is amended--
       (A) in paragraph (1)--
       (i) in subparagraph (A), by striking ``plan for aid to 
     families with dependent children approved'' and inserting 
     ``program funded''; and
       (ii) in subparagraph (B), by striking ``, not including 
     energy or utility-cost assistance,'';
       (B) in paragraph (2), by striking subparagraph (C) and 
     inserting the following:
       ``(C) a payment or allowance described in subsection 
     (d)(11);''; and
       (C) by adding at the end the following:
       ``(4) Third party energy assistance payments.--
       ``(A) Energy assistance payments.--For purposes of 
     subsection (d)(1), a payment made under a Federal or State 
     law to provide energy assistance to a household shall be 
     considered money payable directly to the household.
       ``(B) Energy assistance expenses.--For purposes of 
     subsection (e)(7), an expense paid on behalf of a household 
     under a Federal or State law to provide energy assistance 
     shall be considered an out-of-pocket expense incurred and 
     paid by the household.''.
       (2) Section 2605(f) of the Low-Income Home Energy 
     Assistance Act of 1981 (42 U.S.C. 8624(f)) is amended--
       (A) by striking ``(f)(1) Notwithstanding'' and inserting 
     ``(f) Notwithstanding'';
       (B) in paragraph (1), by striking ``food stamps,''; and
       (C) by striking paragraph (2).

     SEC. 1020. DEDUCTIONS FROM INCOME.

       (a) In General.--Section 5 of the Food Stamp Act of 1977 (7 
     U.S.C. 2014) is amended by striking subsection (e) and 
     inserting the following:
       ``(e) Deductions From Income.--
       ``(1) Standard deduction.--The Secretary shall allow a 
     standard deduction for each household in the 48 contiguous 
     States and the District of Columbia, Alaska, Hawaii, Guam, 
     and the Virgin Islands of the United States of $134, $229, 
     $189, $269, and $118, respectively.
       ``(2) Earned income deduction.--
       ``(A) Definition of earned income.--In this paragraph, the 
     term `earned income' does not include income excluded by 
     subsection (d) or any portion of income earned

[[Page H7822]]

     under a work supplementation or support program, as defined 
     under section 16(b), that is attributable to public 
     assistance.
       ``(B) Deduction.--Except as provided in subparagraph (C), a 
     household with earned income shall be allowed a deduction of 
     20 percent of all earned income to compensate for taxes, 
     other mandatory deductions from salary, and work expenses.
       ``(C) Exception.--The deduction described in subparagraph 
     (B) shall not be allowed with respect to determining an 
     overissuance due to the failure of a household to report 
     earned income in a timely manner.
       ``(3) Dependent care deduction.--
       ``(A) In general.--A household shall be entitled, with 
     respect to expenses (other than excluded expenses described 
     in subparagraph (B)) for dependent care, to a dependent care 
     deduction, the maximum allowable level of which shall be $200 
     per month for each dependent child under 2 years of age and 
     $175 per month for each other dependent, for the actual cost 
     of payments necessary for the care of a dependent if the care 
     enables a household member to accept or continue employment, 
     or training or education that is preparatory for employment.
       ``(B) Excluded expenses.--The excluded expenses referred to 
     in subparagraph (A) are--
       ``(i) expenses paid on behalf of the household by a third 
     party;
       ``(ii) amounts made available and excluded for the expenses 
     referred to in subparagraph (A) under subsection (d)(3); and
       ``(iii) expenses that are paid under section 6(d)(4).
       ``(4) Deduction for child support payments.--
       ``(A) In general.--A household shall be entitled to a 
     deduction for child support payments made by a household 
     member to or for an individual who is not a member of the 
     household if the household member is legally obligated to 
     make the payments.
       ``(B) Methods for determining amount.--The Secretary may 
     prescribe by regulation the methods, including calculation on 
     a retrospective basis, that a State agency shall use to 
     determine the amount of the deduction for child support 
     payments.
       ``(5) Homeless shelter allowance.--A State agency may 
     develop a standard homeless shelter allowance, which shall 
     not exceed $143 per month, for such expenses as may 
     reasonably be expected to be incurred by households in which 
     all members are homeless individuals but are not receiving 
     free shelter throughout the month. A State agency that 
     develops the allowance may use the allowance in determining 
     eligibility and allotments for the households, except that 
     the State agency may prohibit the use of the allowance for 
     households with extremely low shelter costs.
       ``(6) Excess medical expense deduction.--
       ``(A) In general.--A household containing an elderly or 
     disabled member shall be entitled, with respect to expenses 
     other than expenses paid on behalf of the household by a 
     third party, to an excess medical expense deduction for the 
     portion of the actual costs of allowable medical expenses, 
     incurred by the elderly or disabled member, exclusive of 
     special diets, that exceeds $35 per month.
       ``(B) Method of claiming deduction.--
       ``(i) In general.--A State agency shall offer an eligible 
     household under subparagraph (A) a method of claiming a 
     deduction for recurring medical expenses that are initially 
     verified under the excess medical expense deduction in lieu 
     of submitting information or verification on actual expenses 
     on a monthly basis.
       ``(ii) Method.--The method described in clause (i) shall--

       ``(I) be designed to minimize the burden for the eligible 
     elderly or disabled household member choosing to deduct the 
     recurrent medical expenses of the member pursuant to the 
     method;

       ``(II) rely on reasonable estimates of the expected medical 
     expenses of the member for the certification period 
     (including changes that can be reasonably anticipated based 
     on available information about the medical condition of the 
     member, public or private medical insurance coverage, and the 
     current verified medical expenses incurred by the member); 
     and
       ``(III) not require further reporting or verification of a 
     change in medical expenses if such a change has been 
     anticipated for the certification period.

       ``(7) Excess shelter expense deduction.--
       ``(A) In general.--A household shall be entitled, with 
     respect to expenses other than expenses paid on behalf of the 
     household by a third party, to an excess shelter expense 
     deduction to the extent that the monthly amount expended by a 
     household for shelter exceeds an amount equal to 50 percent 
     of monthly household income after all other applicable 
     deductions have been allowed.
       ``(B) Maximum amount of deduction.--In the case of a 
     household that does not contain an elderly or disabled 
     individual, the excess shelter expense deduction shall not 
     exceed--
       ``(i) in the 48 contiguous States and the District of 
     Columbia, $247 per month; and
       ``(ii) in Alaska, Hawaii, Guam, and the Virgin Islands of 
     the United States, $429, $353, $300, and $182 per month, 
     respectively.
       ``(C) Standard utility allowance.--
       ``(i) In general.--In computing the excess shelter expense 
     deduction, a State agency may use a standard utility 
     allowance in accordance with regulations promulgated by the 
     Secretary, except that a State agency may use an allowance 
     that does not fluctuate within a year to reflect seasonal 
     variations.
       ``(ii) Restrictions on heating and cooling expenses.--An 
     allowance for a heating or cooling expense may not be used in 
     the case of a household that--

       ``(I) does not incur a heating or cooling expense, as the 
     case may be;
       ``(II) does incur a heating or cooling expense but is 
     located in a public housing unit that has central utility 
     meters and charges households, with regard to the expense, 
     only for excess utility costs; or
       ``(III) shares the expense with, and lives with, another 
     individual not participating in the food stamp program, 
     another household participating in the food stamp program, or 
     both, unless the allowance is prorated between the household 
     and the other individual, household, or both.

       ``(iii) Mandatory allowance.--

       ``(I) In general.--A State agency may make the use of a 
     standard utility allowance mandatory for all households with 
     qualifying utility costs if--

       ``(aa) the State agency has developed 1 or more standards 
     that include the cost of heating and cooling and 1 or more 
     standards that do not include the cost of heating and 
     cooling; and
       ``(bb) the Secretary finds that the standards will not 
     result in an increased cost to the Secretary.

       ``(II) Household election.--A State agency that has not 
     made the use of a standard utility allowance mandatory under 
     subclause (I) shall allow a household to switch, at the end 
     of a certification period, between the standard utility 
     allowance and a deduction based on the actual utility 
     costs of the household.
       ``(iv) Availability of allowance to recipients of energy 
     assistance.--

       ``(I) In general.--Subject to subclause (II), if a State 
     agency elects to use a standard utility allowance that 
     reflects heating or cooling costs, the standard utility 
     allowance shall be made available to households receiving a 
     payment, or on behalf of which a payment is made, under the 
     Low-Income Home Energy Assistance Act of 1981 (42 U.S.C. 8621 
     et seq.) or other similar energy assistance program, if the 
     household still incurs out-of-pocket heating or cooling 
     expenses in excess of any assistance paid on behalf of the 
     household to an energy provider.
       ``(II) Separate allowance.--A State agency may use a 
     separate standard utility allowance for households on behalf 
     of which a payment described in subclause (I) is made, but 
     may not be required to do so.
       ``(III) States not electing to use separate allowance.--A 
     State agency that does not elect to use a separate allowance 
     but makes a single standard utility allowance available to 
     households incurring heating or cooling expenses (other than 
     a household described in subclause (I) or (II) of 
     subparagraph (C)(ii)) may not be required to reduce the 
     allowance due to the provision (directly or indirectly) of 
     assistance under the Low-Income Home Energy Assistance Act of 
     1981 (42 U.S.C. 8621 et seq.).
       ``(IV) Proration of assistance.--For the purpose of the 
     food stamp program, assistance provided under the Low-Income 
     Home Energy Assistance Act of 1981 (42 U.S.C. 8621 et seq.) 
     shall be considered to be prorated over the entire heating or 
     cooling season for which the assistance was provided.''.

       (b) Conforming Amendment.--Section 11(e)(3) of the Act (7 
     U.S.C. 2020(e)(3)) is amended by striking ``Under rules 
     prescribed'' and all that follows through ``verifies higher 
     expenses;''.

     SEC. 1021. VEHICLE ALLOWANCE.

       Section 5(g) of the Food Stamp Act of 1977 (7 U.S.C. 
     2014(g)) is amended by striking paragraph (2) and inserting 
     the following:
       ``(2) Included assets.--
       ``(A) In general.--Subject to the other provisions of this 
     paragraph, the Secretary shall, in prescribing inclusions in, 
     and exclusions from, financial resources, follow the 
     regulations in force as of June 1, 1982 (other than those 
     relating to licensed vehicles and inaccessible resources).
       ``(B) Additional included assets.--The Secretary shall 
     include in financial resources--
       ``(i) any boat, snowmobile, or airplane used for 
     recreational purposes;
       ``(ii) any vacation home;
       ``(iii) any mobile home used primarily for vacation 
     purposes;
       ``(iv) subject to subparagraph (C), any licensed vehicle 
     that is used for household transportation or to obtain or 
     continue employment to the extent that the fair market value 
     of the vehicle exceeds $4,600; and
       ``(v) any savings or retirement account (including an 
     individual account), regardless of whether there is a penalty 
     for early withdrawal.
       ``(C) Excluded vehicles.--A vehicle (and any other 
     property, real or personal, to the extent the property is 
     directly related to the maintenance or use of the vehicle) 
     shall not be included in financial resources under this 
     paragraph if the vehicle is--
       ``(i) used to produce earned income;
       ``(ii) necessary for the transportation of a physically 
     disabled household member; or
       ``(iii) depended on by a household to carry fuel for 
     heating or water for home use and provides the primary source 
     of fuel or water, respectively, for the household.''.

[[Page H7823]]

     SEC. 1022. VENDOR PAYMENTS FOR TRANSITIONAL HOUSING COUNTED 
                   AS INCOME.

       Section 5(k)(2) of the Food Stamp Act of 1977 (7 U.S.C. 
     2014(k)(2)) is amended--
       (1) by striking subparagraph (F); and
       (2) by redesignating subparagraphs (G) and (H) as 
     subparagraphs (F) and (G), respectively.

     SEC. 1023. DOUBLED PENALTIES FOR VIOLATING FOOD STAMP PROGRAM 
                   REQUIREMENTS.

       Section 6(b)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
     2015(b)(1)) is amended--
       (1) in clause (i), by striking ``six months'' and inserting 
     ``1 year''; and
       (2) in clause (ii), by striking ``1 year'' and inserting 
     ``2 years''.

     SEC. 1024. DISQUALIFICATION OF CONVICTED INDIVIDUALS.

       Section 6(b)(1)(iii) of the Food Stamp Act of 1977 (7 
     U.S.C. 2015(b)(1)(iii)) is amended--
       (1) in subclause (II), by striking ``or'' at the end;
       (2) in subclause (III), by striking the period at the end 
     and inserting ``; or''; and
       (3) by inserting after subclause (III) the following:
       ``(IV) a conviction of an offense under subsection (b) or 
     (c) of section 15 involving an item covered by subsection (b) 
     or (c) of section 15 having a value of $500 or more.''.

     SEC. 1025. DISQUALIFICATION.

       (a) In General.--Section 6(d) of the Food Stamp Act of 1977 
     (7 U.S.C. 2015(d)) is amended by striking ``(d)(1) Unless 
     otherwise exempted by the provisions'' and all that follows 
     through the end of paragraph (1) and inserting the following:
       ``(d) Conditions of Participation.--
       ``(1) Work requirements.--
       ``(A) In general.--No physically and mentally fit 
     individual over the age of 15 and under the age of 60 shall 
     be eligible to participate in the food stamp program if the 
     individual--
       ``(i) refuses, at the time of application and every 12 
     months thereafter, to register for employment in a manner 
     prescribed by the Secretary;
       ``(ii) refuses without good cause to participate in an 
     employment and training program under paragraph (4), to the 
     extent required by the State agency;
       ``(iii) refuses without good cause to accept an offer of 
     employment, at a site or plant not subject to a strike or 
     lockout at the time of the refusal, at a wage not less than 
     the higher of--

       ``(I) the applicable Federal or State minimum wage; or
       ``(II) 80 percent of the wage that would have governed had 
     the minimum hourly rate under section 6(a)(1) of the Fair 
     Labor Standards Act of 1938 (29 U.S.C. 206(a)(1)) been 
     applicable to the offer of employment;

       ``(iv) refuses without good cause to provide a State agency 
     with sufficient information to allow the State agency to 
     determine the employment status or the job availability of 
     the individual;
       ``(v) voluntarily and without good cause--

       ``(I) quits a job; or

       ``(II) reduces work effort and, after the reduction, the 
     individual is working less than 30 hours per week; or

       ``(vi) fails to comply with section 20.
       ``(B) Household ineligibility.--If an individual who is the 
     head of a household becomes ineligible to participate in the 
     food stamp program under subparagraph (A), the household 
     shall, at the option of the State agency, become ineligible 
     to participate in the food stamp program for a period, 
     determined by the State agency, that does not exceed the 
     lesser of--
       ``(i) the duration of the ineligibility of the individual 
     determined under subparagraph (C); or
       ``(ii) 180 days.
       ``(C) Duration of ineligibility.--
       ``(i) First violation.--The first time that an individual 
     becomes ineligible to participate in the food stamp program 
     under subparagraph (A), the individual shall remain 
     ineligible until the later of--

       ``(I) the date the individual becomes eligible under 
     subparagraph (A);
       ``(II) the date that is 1 month after the date the 
     individual became ineligible; or
       ``(III) a date determined by the State agency that is not 
     later than 3 months after the date the individual became 
     ineligible.

       ``(ii) Second violation.--The second time that an 
     individual becomes ineligible to participate in the food 
     stamp program under subparagraph (A), the individual shall 
     remain ineligible until the later of--

       ``(I) the date the individual becomes eligible under 
     subparagraph (A);
       ``(II) the date that is 3 months after the date the 
     individual became ineligible; or
       ``(III) a date determined by the State agency that is not 
     later than 6 months after the date the individual became 
     ineligible.

       ``(iii) Third or subsequent violation.--The third or 
     subsequent time that an individual becomes ineligible to 
     participate in the food stamp program under subparagraph (A), 
     the individual shall remain ineligible until the later of--

       ``(I) the date the individual becomes eligible under 
     subparagraph (A);
       ``(II) the date that is 6 months after the date the 
     individual became ineligible;
       ``(III) a date determined by the State agency; or
       ``(IV) at the option of the State agency, permanently.

       ``(D) Administration.--
       ``(i) Good cause.--The Secretary shall determine the 
     meaning of good cause for the purpose of this paragraph.
       ``(ii) Voluntary quit.--The Secretary shall determine the 
     meaning of voluntarily quitting and reducing work effort for 
     the purpose of this paragraph.
       ``(iii) Determination by state agency.--

       ``(I) In general.--Subject to subclause (II) and clauses 
     (i) and (ii), a State agency shall determine--

       ``(aa) the meaning of any term in subparagraph (A);
       ``(bb) the procedures for determining whether an individual 
     is in compliance with a requirement under subparagraph (A); 
     and
       ``(cc) whether an individual is in compliance with a 
     requirement under subparagraph (A).

       ``(II) Not less restrictive.--A State agency may not 
     determine a meaning, procedure, or determination under 
     subclause (I) to be less restrictive than a comparable 
     meaning, procedure, or determination under a State program 
     funded under part A of title IV of the Social Security Act 
     (42 U.S.C. 601 et seq.).

       ``(iv) Strike against the government.--For the purpose of 
     subparagraph (A)(v), an employee of the Federal Government, a 
     State, or a political subdivision of a State, who is 
     dismissed for participating in a strike against the Federal 
     Government, the State, or the political subdivision of the 
     State shall be considered to have voluntarily quit without 
     good cause.
       ``(v) Selecting a head of household.--

       ``(I) In general.--For the purpose of this paragraph, the 
     State agency shall allow the household to select any adult 
     parent of a child in the household as the head of the 
     household if all adult household members making application 
     under the food stamp program agree to the selection.
       ``(II) Time for making designation.--A household may 
     designate the head of the household under subclause (I) each 
     time the household is certified for participation in the food 
     stamp program, but may not change the designation during a 
     certification period unless there is a change in the 
     composition of the household.

       ``(vi) Change in head of household.--If the head of a 
     household leaves the household during a period in which the 
     household is ineligible to participate in the food stamp 
     program under subparagraph (B)--

       ``(I) the household shall, if otherwise eligible, become 
     eligible to participate in the food stamp program; and
       ``(II) if the head of the household becomes the head of 
     another household, the household that becomes headed by the 
     individual shall become ineligible to participate in the food 
     stamp program for the remaining period of ineligibility.''.

       (b) Conforming Amendment.--
       (1) The second sentence of section 17(b)(2) of the Act (7 
     U.S.C. 2026(b)(2)) is amended by striking ``6(d)(1)(i)'' and 
     inserting ``6(d)(1)(A)(i)''.
       (2) Section 20 of the Act (7 U.S.C. 2029) is amended by 
     striking subsection (f) and inserting the following:
       ``(f) Disqualification.--An individual or a household may 
     become ineligible under section 6(d)(1) to participate in the 
     food stamp program for failing to comply with this 
     section.''.

     SEC. 1026. CARETAKER EXEMPTION.

       Section 6(d)(2) of the Food Stamp Act of 1977 (7 U.S.C. 
     2015(d)(2)) is amended by striking subparagraph (B) and 
     inserting the following: ``(B) a parent or other member of a 
     household with responsibility for the care of (i) a dependent 
     child under the age of 6 or any lower age designated by the 
     State agency that is not under the age of 1, or (ii) an 
     incapacitated person;''.

     SEC. 1027. EMPLOYMENT AND TRAINING.

       (a) In General.--Section 6(d)(4) of the Food Stamp Act of 
     1977 (7 U.S.C. 2015(d)(4)) is amended--
       (1) in subparagraph (A)--
       (A) by striking ``Not later than April 1, 1987, each'' and 
     inserting ``Each'';
       (B) by inserting ``work,'' after ``skills, training,''; and
       (C) by adding at the end the following: ``Each component of 
     an employment and training program carried out under this 
     paragraph shall be delivered through a statewide workforce 
     development system, unless the component is not available 
     locally through the statewide workforce development 
     system.'';
       (2) in subparagraph (B)--
       (A) in the matter preceding clause (i), by striking the 
     colon at the end and inserting the following: ``, except that 
     the State agency shall retain the option to apply employment 
     requirements prescribed under this subparagraph to a program 
     applicant at the time of application:'';
       (B) in clause (i), by striking ``with terms and 
     conditions'' and all that follows through ``time of 
     application''; and
       (C) in clause (iv)--
       (i) by striking subclauses (I) and (II); and
       (ii) by redesignating subclauses (III) and (IV) as 
     subclauses (I) and (II), respectively;
       (3) in subparagraph (D)--
       (A) in clause (i), by striking ``to which the application'' 
     and all that follows through ``30 days or less'';
       (B) in clause (ii), by striking ``but with respect'' and 
     all that follows through ``child care''; and
       (C) in clause (iii), by striking ``, on the basis of'' and 
     all that follows through ``clause (ii)'' and inserting ``the 
     exemption continues to be valid'';
       (4) in subparagraph (E), by striking the third sentence;

[[Page H7824]]

       (5) in subparagraph (G)--
       (A) by striking ``(G)(i) The State'' and inserting ``(G) 
     The State''; and
       (B) by striking clause (ii);
       (6) in subparagraph (H), by striking ``(H)(i) The 
     Secretary'' and all that follows through ``(ii) Federal 
     funds'' and inserting ``(H) Federal funds'';
       (7) in subparagraph (I)(i)(II), by striking ``, or was in 
     operation,'' and all that follows through ``Social Security 
     Act'' and inserting the following: ``), except that no such 
     payment or reimbursement shall exceed the applicable local 
     market rate'';
       (8)(A) by striking subparagraphs (K) and (L) and inserting 
     the following:
       ``(K) Limitation on funding.--Notwithstanding any other 
     provision of this paragraph, the amount of funds a State 
     agency uses to carry out this paragraph (including under 
     subparagraph (I)) for participants who are receiving benefits 
     under a State program funded under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.) shall not exceed 
     the amount of funds the State agency used in fiscal year 1995 
     to carry out this paragraph for participants who were 
     receiving benefits in fiscal year 1995 under a State program 
     funded under part A of title IV of the Act (42 U.S.C. 601 et 
     seq.).''; and
       (B) by redesignating subparagraphs (M) and (N) as 
     subparagraphs (L) and (M), respectively; and
       (9) in subparagraph (L), as redesignated by paragraph 
     (8)(B)--
       (A) by striking ``(L)(i) The Secretary'' and inserting 
     ``(L) The Secretary''; and
       (B) by striking clause (ii).
       (b) Funding.--Section 16(h) of the Act (7 U.S.C. 2025(h)) 
     is amended by striking ``(h)(1)(A) The Secretary'' and all 
     that follows through the end of paragraph (1) and inserting 
     the following:
       ``(h) Funding of Employment and Training Programs.--
       ``(1) In general.--
       ``(A) Amounts.--To carry out employment and training 
     programs, the Secretary shall reserve for allocation to State 
     agencies from funds made available for each fiscal year under 
     section 18(a)(1) the amount of--
       ``(i) for fiscal year 1996, $75,000,000;
       ``(ii) for fiscal year 1997, $79,000,000;
       ``(iii) for fiscal year 1998, $81,000,000;
       ``(iv) for fiscal year 1999, $84,000,000;
       ``(v) for fiscal year 2000, $86,000,000;
       ``(vi) for fiscal year 2001, $88,000,000; and
       ``(vii) for fiscal year 2002, $90,000,000.
       ``(B) Allocation.--The Secretary shall allocate the amounts 
     reserved under subparagraph (A) among the State agencies 
     using a reasonable formula (as determined by the Secretary) 
     that gives consideration to the population in each State 
     affected by section 6(o).
       ``(C) Reallocation.--
       ``(i) Notification.--A State agency shall promptly notify 
     the Secretary if the State agency determines that the State 
     agency will not expend all of the funds allocated to the 
     State agency under subparagraph (B).
       ``(ii) Reallocation.--On notification under clause (i), the 
     Secretary shall reallocate the funds that the State agency 
     will not expend as the Secretary considers appropriate and 
     equitable.
       ``(D) Minimum allocation.--Notwithstanding subparagraphs 
     (A) through (C), the Secretary shall ensure that each State 
     agency operating an employment and training program shall 
     receive not less than $50,000 in each fiscal year.''.
       (c) Additional Matching Funds.--Section 16(h)(2) of the Act 
     (7 U.S.C. 2025(h)(2)) is amended by inserting before the 
     period at the end the following: ``, including the costs for 
     case management and casework to facilitate the transition 
     from economic dependency to self-sufficiency through work''.
       (d) Reports.--Section 16(h) of the Act (7 U.S.C. 2025(h)) 
     is amended--
       (1) in paragraph (5)--
       (A) by striking ``(5)(A) The Secretary'' and inserting 
     ``(5) The Secretary''; and
       (B) by striking subparagraph (B); and
       (2) by striking paragraph (6).

     SEC. 1028. COMPARABLE TREATMENT FOR DISQUALIFICATION.

       (a) In General.--Section 6 of the Food Stamp Act of 1977 (7 
     U.S.C. 2015) is amended by adding at the end the following:
       ``(i) Comparable Treatment for Disqualification.--
       ``(1) In general.--If a disqualification is imposed on a 
     member of a household for a failure of the member to perform 
     an action required under a Federal, State, or local law 
     relating to a means-tested public assistance program, the 
     State agency may impose the same disqualification on the 
     member of the household under the food stamp program.
       ``(2) Rules and procedures.--If a disqualification is 
     imposed under paragraph (1) for a failure of an individual to 
     perform an action required under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.), the State agency 
     may use the rules and procedures that apply under part A of 
     title IV of the Act to impose the same disqualification under 
     the food stamp program.
       ``(3) Application after disqualification period.--A member 
     of a household disqualified under paragraph (1) may, after 
     the disqualification period has expired, apply for benefits 
     under this Act and shall be treated as a new applicant, 
     except that a prior disqualification under subsection (d) 
     shall be considered in determining eligibility.''.
       (b) State Plan Provisions.--Section 11(e) of the Act (7 
     U.S.C. 2020(e)) is amended--
       (1) in paragraph (24), by striking ``and'' at the end;
       (2) in paragraph (25), by striking the period at the end 
     and inserting a semicolon; and
       (3) by adding at the end the following:
       ``(26) the guidelines the State agency uses in carrying out 
     section 6(i); and''.
       (c) Conforming Amendment.--Section 6(d)(2)(A) of the Act (7 
     U.S.C. 2015(d)(2)(A)) is amended by striking ``that is 
     comparable to a requirement of paragraph (1)''.

     SEC. 1029. DISQUALIFICATION FOR RECEIPT OF MULTIPLE FOOD 
                   STAMP BENEFITS.

       Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as 
     amended by section 1028, is amended by adding at the end the 
     following:
       ``(j) Disqualification for Receipt of Multiple Food Stamp 
     Benefits.--An individual shall be ineligible to participate 
     in the food stamp program as a member of any household for a 
     10-year period if the individual is found by a State agency 
     to have made, or is convicted in a Federal or State court of 
     having made, a fraudulent statement or representation with 
     respect to the identity or place of residence of the 
     individual in order to receive multiple benefits 
     simultaneously under the food stamp program.''.

     SEC. 1030. DISQUALIFICATION OF FLEEING FELONS.

       Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as 
     amended by sections 1028 and 1029, is amended by adding at 
     the end the following:
       ``(k) Disqualification of Fleeing Felons.--No member of a 
     household who is otherwise eligible to participate in the 
     food stamp program shall be eligible to participate in the 
     program as a member of that or any other household during any 
     period during which the individual is--
       ``(1) fleeing to avoid prosecution, or custody or 
     confinement after conviction, under the law of the place from 
     which the individual is fleeing, for a crime, or attempt to 
     commit a crime, that is a felony under the law of the place 
     from which the individual is fleeing or that, in the case of 
     New Jersey, is a high misdemeanor under the law of New 
     Jersey; or
       ``(2) violating a condition of probation or parole imposed 
     under a Federal or State law.''.

     SEC. 1031. COOPERATION WITH CHILD SUPPORT AGENCIES.

       Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as 
     amended by sections 1028 through 1030, is amended by adding 
     at the end the following:
       ``(l) Custodial Parent's Cooperation With Child Support 
     Agencies.--
       ``(1) In general.--At the option of a State agency, subject 
     to paragraphs (2) and (3), no natural or adoptive parent or 
     other individual (collectively referred to in this subsection 
     as `the individual') who is living with and exercising 
     parental control over a child under the age of 18 who has an 
     absent parent shall be eligible to participate in the food 
     stamp program unless the individual cooperates with the State 
     agency administering the program established under part D of 
     title IV of the Social Security Act (42 U.S.C. 651 et seq.)--
       ``(A) in establishing the paternity of the child (if the 
     child is born out of wedlock); and
       ``(B) in obtaining support for--
       ``(i) the child; or
       ``(ii) the individual and the child.
       ``(2) Good cause for noncooperation.--Paragraph (1) shall 
     not apply to the individual if good cause is found for 
     refusing to cooperate, as determined by the State agency in 
     accordance with standards prescribed by the Secretary in 
     consultation with the Secretary of Health and Human Services. 
     The standards shall take into consideration circumstances 
     under which cooperation may be against the best interests of 
     the child.
       ``(3) Fees.--Paragraph (1) shall not require the payment of 
     a fee or other cost for services provided under part D of 
     title IV of the Social Security Act (42 U.S.C. 651 et seq.).
       ``(m) Noncustodial Parent's Cooperation With Child Support 
     Agencies.--
       ``(1) In general.--At the option of a State agency, subject 
     to paragraphs (2) and (3), a putative or identified 
     noncustodial parent of a child under the age of 18 (referred 
     to in this subsection as `the individual') shall not be 
     eligible to participate in the food stamp program if the 
     individual refuses to cooperate with the State agency 
     administering the program established under part D of title 
     IV of the Social Security Act (42 U.S.C. 651 et seq.)--
       ``(A) in establishing the paternity of the child (if the 
     child is born out of wedlock); and
       ``(B) in providing support for the child.
       ``(2) Refusal to cooperate.--
       ``(A) Guidelines.--The Secretary, in consultation with the 
     Secretary of Health and Human Services, shall develop 
     guidelines on what constitutes a refusal to cooperate under 
     paragraph (1).
       ``(B) Procedures.--The State agency shall develop 
     procedures, using guidelines developed under subparagraph 
     (A), for determining whether an individual is refusing to 
     cooperate under paragraph (1).
       ``(3) Fees.--Paragraph (1) shall not require the payment of 
     a fee or other cost for services provided under part D of 
     title IV of the Social Security Act (42 U.S.C. 651 et seq.).
       ``(4) Privacy.--The State agency shall provide safeguards 
     to restrict the use of information collected by a State 
     agency administering the program established under part D of 
     title IV of the Social Security Act (42

[[Page H7825]]

     U.S.C. 651 et seq.) to purposes for which the information is 
     collected.''.

     SEC. 1032. DISQUALIFICATION RELATING TO CHILD SUPPORT 
                   ARREARS.

       Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as 
     amended by sections 1028 through 1031, is amended by adding 
     at the end the following:
       ``(n) Disqualification for Child Support Arrears.--
       ``(1) In general.--At the option of the State agency, no 
     individual shall be eligible to participate in the food stamp 
     program as a member of any household during any month that 
     the individual is delinquent in any payment due under a court 
     order for the support of a child of the individual.
       ``(2) Exceptions.--Paragraph (1) shall not apply if--
       ``(A) a court is allowing the individual to delay payment; 
     or
       ``(B) the individual is complying with a payment plan 
     approved by a court or the State agency designated under part 
     D of title IV of the Social Security Act (42 U.S.C. 651 et 
     seq.) to provide support for the child of the individual.''.

     SEC. 1033. WORK REQUIREMENT.

       (a) In General.--Section 6 of the Food Stamp Act of 1977 (7 
     U.S.C. 2015), as amended by sections 1028 through 1032, is 
     amended by adding at the end the following:
       ``(o) Work Requirement.--
       ``(1) Definition of work program.--In this subsection, the 
     term `work program' means--
       ``(A) a program under the Job Training Partnership Act (29 
     U.S.C. 1501 et seq.);
       ``(B) a program under section 236 of the Trade Act of 1974 
     (19 U.S.C. 2296); or
       ``(C) a program of employment and training operated or 
     supervised by a State or political subdivision of a State 
     that meets standards approved by the Governor of the State, 
     including a program under section 6(d)(4), other than a job 
     search program or a job search training program.
       ``(2) Work requirement.--Subject to the other provisions of 
     this subsection, no individual shall be eligible to 
     participate in the food stamp program as a member of any 
     household if, during the preceding 12-month period, 
     the individual received food stamp benefits for not less 
     than 4 months during which the individual did not--
       ``(A) work 20 hours or more per week, averaged monthly; or
       ``(B) participate in and comply with the requirements of a 
     work program for 20 hours or more per week, as determined by 
     the State agency; or
       ``(C) participate in a program under section 20 or a 
     comparable program established by a State or political 
     subdivision of a State.
       ``(3) Exception.--Paragraph (2) shall not apply to an 
     individual if the individual is--
       ``(A) under 18 or over 50 years of age;
       ``(B) medically certified as physically or mentally unfit 
     for employment;
       ``(C) a parent or other member of a household with 
     responsibility for a dependent child;
       ``(D) otherwise exempt under section 6(d)(2); or
       ``(E) a pregnant woman.
       ``(4) Waiver.--
       ``(A) In general.--On the request of a State agency, the 
     Secretary may waive the applicability of paragraph (2) to any 
     group of individuals in the State if the Secretary makes a 
     determination that the area in which the individuals reside--
       ``(i) has an unemployment rate of over 10 percent; or
       ``(ii) does not have a sufficient number of jobs to provide 
     employment for the individuals.
       ``(B) Report.--The Secretary shall report the basis for a 
     waiver under subparagraph (A) to the Committee on Agriculture 
     of the House of Representatives and the Committee on 
     Agriculture, Nutrition, and Forestry of the Senate.
       ``(5) Subsequent eligibility.--
       ``(A) In general.--Paragraph (2) shall cease to apply to an 
     individual if, during a 30-day period, the individual--
       ``(i) works 80 or more hours;
       ``(ii) participates in and complies with the requirements 
     of a work program for 80 or more hours, as determined by a 
     State agency; or
       ``(iii) participates in a program under section 20 or a 
     comparable program established by a State or political 
     subdivision of a State.
       ``(B) Limitation.--During the subsequent 12-month period, 
     the individual shall be eligible to participate in the food 
     stamp program for not more than 4 months during which the 
     individual does not--
       ``(i) work 20 hours or more per week, averaged monthly;
       ``(ii) participate in and comply with the requirements of a 
     work program for 20 hours or more per week, as determined by 
     the State agency; or
       ``(iii) participate in a program under section 20 or a 
     comparable program established by a State or political 
     subdivision of a State.''.
       (b) Transition Provision.--Prior to 1 year after the date 
     of enactment of this Act, the term ``preceding 12-month 
     period'' in section 6(o) of the Food Stamp Act of 1977, as 
     amended by subsection (a), means the preceding period that 
     begins on the date of enactment of this Act.

     SEC. 1034. ENCOURAGE ELECTRONIC BENEFIT TRANSFER SYSTEMS.

       (a) In General.--Section 7(i) of the Food Stamp Act of 1977 
     (7 U.S.C. 2016(i)) is amended--
       (1) by striking paragraph (1) and inserting the following:
       ``(1) Electronic benefit transfers.--
       ``(A) Implementation.--Each State agency shall implement an 
     electronic benefit transfer system in which household 
     benefits determined under section 8(a) or 26 are issued 
     from and stored in a central databank before October 1, 
     2002, unless the Secretary provides a waiver for a State 
     agency that faces unusual barriers to implementing an 
     electronic benefit transfer system.
       ``(B) Timely implementation.--State agencies are encouraged 
     to implement an electronic benefit transfer system under 
     subparagraph (A) as soon as practicable.
       ``(C) State flexibility.--Subject to paragraph (2), a State 
     agency may procure and implement an electronic benefit 
     transfer system under the terms, conditions, and design that 
     the State agency considers appropriate.
       ``(D) Operation.--An electronic benefit transfer system 
     should take into account generally accepted standard 
     operating rules based on--
       ``(i) commercial electronic funds transfer technology;
       ``(ii) the need to permit interstate operation and law 
     enforcement monitoring; and
       ``(iii) the need to permit monitoring and investigations by 
     authorized law enforcement agencies.'';
       (2) in paragraph (2)--
       (A) by striking ``effective no later than April 1, 1992,'';
       (B) in subparagraph (A)--
       (i) by striking ``, in any 1 year,''; and
       (ii) by striking ``on-line'';
       (C) by striking subparagraph (D) and inserting the 
     following:
       ``(D)(i) measures to maximize the security of a system 
     using the most recent technology available that the State 
     agency considers appropriate and cost effective and which may 
     include personal identification numbers, photographic 
     identification on electronic benefit transfer cards, and 
     other measures to protect against fraud and abuse; and
       ``(ii) effective not later than 2 years after the effective 
     date of this clause, to the extent practicable, measures that 
     permit a system to differentiate items of food that may be 
     acquired with an allotment from items of food that may not be 
     acquired with an allotment.'';
       (D) in subparagraph (G), by striking ``and'' at the end;
       (E) in subparagraph (H), by striking the period at the end 
     and inserting ``; and''; and
       (F) by adding at the end the following:
       ``(I) procurement standards.''; and
       (3) by adding at the end the following:
       ``(7) Replacement of benefits.--Regulations issued by the 
     Secretary regarding the replacement of benefits and liability 
     for replacement of benefits under an electronic benefit 
     transfer system shall be similar to the regulations in effect 
     for a paper food stamp issuance system.
       ``(8) Replacement card fee.--A State agency may collect a 
     charge for replacement of an electronic benefit transfer card 
     by reducing the monthly allotment of the household receiving 
     the replacement card.
       ``(9) Optional photographic identification.--
       ``(A) In general.--A State agency may require that an 
     electronic benefit card contain a photograph of 1 or more 
     members of a household.
       ``(B) Other authorized users.--If a State agency requires a 
     photograph on an electronic benefit card under subparagraph 
     (A), the State agency shall establish procedures to ensure 
     that any other appropriate member of the household or any 
     authorized representative of the household may utilize the 
     card.
       ``(10) Application of anti-tying restrictions to electronic 
     benefit transfer systems.--
       ``(A) In general.--A company shall not sell or provide 
     electronic benefit transfer services, or fix or vary the 
     consideration for such services, on the condition or 
     requirement that the customer--
       ``(i) obtain some additional point-of-sale service from the 
     company or any affiliate of the company; or
       ``(ii) not obtain some additional point-of-sale service 
     from a competitor of the company or competitor of any 
     affiliate of the company.
       ``(B) Definitions.--In this paragraph--
       ``(i) Affiliate.--The term `affiliate' shall have the same 
     meaning as in section 2(k) of the Bank Holding Company Act.
       ``(ii) Company.--The term `company' shall have the same 
     meaning as in section 106(a) of the Bank Holding Company Act 
     Amendments of 1970, but shall not include a bank, bank 
     holding company, or any subsidiary of a bank holding company.
       ``(iii) Electronic benefit transfer service.--The term 
     `electronic benefit transfer service' means the processing of 
     electronic transfers of household benefits determined under 
     section 8(a) or 26 where the benefits are--

       ``(I) issued from and stored in a central databank;
       ``(II) electronically accessed by household members at the 
     point of sale; and
       ``(III) provided by a Federal or state government.

       ``(iv) Point-of-sale service.--The term `point-of-sale 
     service' means any product or service related to the 
     electronic authorization and processing of payments for 
     merchandise at a retail food store, including but

[[Page H7826]]

     not limited to credit or debit card services, automated 
     teller machines, point-of-sale terminals, or access to on-
     line systems.
       ``(C) Consultation with the federal reserve board.--Before 
     promulgating regulations or interpretations of regulations to 
     carry out this paragraph, the Secretary shall consult with 
     the Board of Governors of the Federal Reserve System.''.
       (b) Sense of Congress.--It is the sense of Congress that a 
     State that operates an electronic benefit transfer system 
     under the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.) 
     should operate the system in a manner that is compatible with 
     electronic benefit transfer systems operated by other States.

     SEC. 1035. VALUE OF MINIMUM ALLOTMENT.

       The proviso in section 8(a) of the Food Stamp Act of 1977 
     (7 U.S.C. 2017(a)) is amended by striking ``, and shall be 
     adjusted'' and all that follows through ``$5''.

     SEC. 1036. BENEFITS ON RECERTIFICATION.

       Section 8(c)(2)(B) of the Food Stamp Act of 1977 (7 U.S.C. 
     2017(c)(2)(B)) is amended by striking ``of more than one 
     month''.

     SEC. 1037. OPTIONAL COMBINED ALLOTMENT FOR EXPEDITED 
                   HOUSEHOLDS.

       Section 8(c) of the Food Stamp Act of 1977 (7 U.S.C. 
     2017(c)) is amended by striking paragraph (3) and inserting 
     the following:
       ``(3) Optional combined allotment for expedited 
     households.--A State agency may provide to an eligible 
     household applying after the 15th day of a month, in lieu of 
     the initial allotment of the household and the regular 
     allotment of the household for the following month, an 
     allotment that is equal to the total amount of the initial 
     allotment and the first regular allotment. The allotment 
     shall be provided in accordance with section 11(e)(3) in the 
     case of a household that is not entitled to expedited service 
     and in accordance with paragraphs (3) and (9) of section 
     11(e) in the case of a household that is entitled to 
     expedited service.''.

     SEC. 1038. FAILURE TO COMPLY WITH OTHER MEANS-TESTED PUBLIC 
                   ASSISTANCE PROGRAMS.

       Section 8 of the Food Stamp Act of 1977 (7 U.S.C. 2017) is 
     amended by striking subsection (d) and inserting the 
     following:
       ``(d) Reduction of Public Assistance Benefits.--
       ``(1) In general.--If the benefits of a household are 
     reduced under a Federal, State, or local law relating to a 
     means-tested public assistance program for the failure of a 
     member of the household to perform an action required under 
     the law or program, for the duration of the reduction--
       ``(A) the household may not receive an increased allotment 
     as the result of a decrease in the income of the household to 
     the extent that the decrease is the result of the reduction; 
     and
       ``(B) the State agency may reduce the allotment of the 
     household by not more than 25 percent.
       ``(2) Rules and procedures.--If the allotment of a 
     household is reduced under this subsection for a failure to 
     perform an action required under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.), the State agency 
     may use the rules and procedures that apply under part A of 
     title IV of the Act to reduce the allotment under the food 
     stamp program.''.

     SEC. 1039. ALLOTMENTS FOR HOUSEHOLDS RESIDING IN CENTERS.

       Section 8 of the Food Stamp Act of 1977 (7 U.S.C. 2017) is 
     amended by adding at the end the following:
       ``(f) Allotments for Households Residing in Centers.--
       ``(1) In general.--In the case of an individual who resides 
     in a center for the purpose of a drug or alcoholic treatment 
     program described in the last sentence of section 3(i), a 
     State agency may provide an allotment for the individual to--
       ``(A) the center as an authorized representative of the 
     individual for a period that is less than 1 month; and
       ``(B) the individual, if the individual leaves the center.
       ``(2) Direct payment.--A State agency may require an 
     individual referred to in paragraph (1) to designate the 
     center in which the individual resides as the authorized 
     representative of the individual for the purpose of receiving 
     an allotment.''.

     SEC. 1040. CONDITION PRECEDENT FOR APPROVAL OF RETAIL FOOD 
                   STORES AND WHOLESALE FOOD CONCERNS.

       Section 9(a)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
     2018(a)(1)) is amended by adding at the end the following: 
     ``No retail food store or wholesale food concern of a type 
     determined by the Secretary, based on factors that include 
     size, location, and type of items sold, shall be approved to 
     be authorized or reauthorized for participation in the food 
     stamp program unless an authorized employee of the Department 
     of Agriculture, a designee of the Secretary, or, if 
     practicable, an official of the State or local government 
     designated by the Secretary has visited the store or concern 
     for the purpose of determining whether the store or concern 
     should be approved or reauthorized, as appropriate.''.

     SEC. 1041. AUTHORITY TO ESTABLISH AUTHORIZATION PERIODS.

       Section 9(a) of the Food Stamp Act of 1977 (7 U.S.C. 
     2018(a)) is amended by adding at the end the following:
       ``(3) Authorization periods.--The Secretary shall establish 
     specific time periods during which authorization to accept 
     and redeem coupons, or to redeem benefits through an 
     electronic benefit transfer system, shall be valid under the 
     food stamp program.''.

     SEC. 1042. INFORMATION FOR VERIFYING ELIGIBILITY FOR 
                   AUTHORIZATION.

       Section 9(c) of the Food Stamp Act of 1977 (7 U.S.C. 
     2018(c)) is amended--
       (1) in the first sentence, by inserting ``, which may 
     include relevant income and sales tax filing documents,'' 
     after ``submit information''; and
       (2) by inserting after the first sentence the following: 
     ``The regulations may require retail food stores 
     and wholesale food concerns to provide written 
     authorization for the Secretary to verify all relevant tax 
     filings with appropriate agencies and to obtain 
     corroborating documentation from other sources so that the 
     accuracy of information provided by the stores and 
     concerns may be verified.''.

     SEC. 1043. WAITING PERIOD FOR STORES THAT FAIL TO MEET 
                   AUTHORIZATION CRITERIA.

       Section 9(d) of the Food Stamp Act of 1977 (7 U.S.C. 
     2018(d)) is amended by adding at the end the following: ``A 
     retail food store or wholesale food concern that is denied 
     approval to accept and redeem coupons because the store or 
     concern does not meet criteria for approval established by 
     the Secretary may not, for at least 6 months, submit a new 
     application to participate in the program. The Secretary may 
     establish a longer time period under the preceding sentence, 
     including permanent disqualification, that reflects the 
     severity of the basis of the denial.''.

     SEC. 1044. OPERATION OF FOOD STAMP OFFICES.

       Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020), 
     as amended by sections 1020(b) and 1028(b), is amended--
       (1) in subsection (e)--
       (A) by striking paragraph (2) and inserting the following:
       ``(2)(A) that the State agency shall establish procedures 
     governing the operation of food stamp offices that the State 
     agency determines best serve households in the State, 
     including households with special needs, such as households 
     with elderly or disabled members, households in rural areas 
     with low-income members, homeless individuals, households 
     residing on reservations, and households in areas in which a 
     substantial number of members of low-income households speak 
     a language other than English;
       ``(B) that in carrying out subparagraph (A), a State 
     agency--
       ``(i) shall provide timely, accurate, and fair service to 
     applicants for, and participants in, the food stamp program;
       ``(ii) shall develop an application containing the 
     information necessary to comply with this Act;
       ``(iii) shall permit an applicant household to apply to 
     participate in the program on the same day that the household 
     first contacts a food stamp office in person during office 
     hours;
       ``(iv) shall consider an application that contains the 
     name, address, and signature of the applicant to be filed on 
     the date the applicant submits the application;
       ``(v) shall require that an adult representative of each 
     applicant household certify in writing, under penalty of 
     perjury, that--
       ``(I) the information contained in the application is true; 
     and
       ``(II) all members of the household are citizens or are 
     aliens eligible to receive food stamps under section 6(f);
       ``(vi) shall provide a method of certifying and issuing 
     coupons to eligible homeless individuals, to ensure that 
     participation in the food stamp program is limited to 
     eligible households; and
       ``(vii) may establish operating procedures that vary for 
     local food stamp offices to reflect regional and local 
     differences within the State;
       ``(C) that nothing in this Act shall prohibit the use of 
     signatures provided and maintained electronically, storage of 
     records using automated retrieval systems only, or any other 
     feature of a State agency's application system that does not 
     rely exclusively on the collection and retention of paper 
     applications or other records;
       ``(D) that the signature of any adult under this paragraph 
     shall be considered sufficient to comply with any provision 
     of Federal law requiring a household member to sign an 
     application or statement;'';
       (B) in paragraph (3), as amended by section 1020(b)--
       (i) by striking ``shall--'' and all that follows through 
     ``provide each'' and inserting ``shall provide each''; and
       (ii) by striking ``(B) assist'' and all that follows 
     through ``representative of the State agency;'';
       (C) by striking paragraphs (14) and (25);
       (D)(i) by redesignating paragraphs (15) through (24) as 
     paragraphs (14) through (23), respectively; and
       (ii) by redesignating paragraph (26), as added by section 
     1028(b), as paragraph (24); and
       (2) in subsection (i)--
       (A) by striking ``(i) Notwithstanding'' and all that 
     follows through ``(2)'' and inserting the following:
       ``(i) Application and Denial Procedures.--
       ``(1) Application procedures.--Notwithstanding any other 
     provision of law,''; and
       (B) by striking ``; (3) households'' and all that follows 
     through ``title IV of the Social Security Act. No'' and 
     inserting a period and the following:
       ``(2) Denial and termination.--Other than in a case of 
     disqualification as a penalty for failure to comply with a 
     public assistance program rule or regulation, no''.

[[Page H7827]]

     SEC. 1045. STATE EMPLOYEE AND TRAINING STANDARDS.

       Section 11(e)(6) of the Food Stamp Act of 1977 (7 U.S.C. 
     2020(e)(6)) is amended--
       (1) by striking ``that (A) the'' and inserting ``that--
       ``(A) the'';
       (2) by striking ``Act; (B) the'' and inserting ``Act; and
       ``(B) the'';
       (3) in subparagraph (B), by striking ``United States Civil 
     Service Commission'' and inserting ``Office of Personnel 
     Management''; and
       (4) by striking subparagraphs (C) through (E).

     SEC. 1046. EXCHANGE OF LAW ENFORCEMENT INFORMATION.

       Section 11(e)(8) of the Food Stamp Act of 1977 (7 U.S.C. 
     2020(e)(8)) is amended--
       (1) by striking ``that (A) such'' and inserting the 
     following: ``that--
       ``(A) the'';
       (2) by striking ``law, (B) notwithstanding'' and inserting 
     the following: ``law;
       ``(B) notwithstanding'';
       (3) by striking ``Act, and (C) such'' and inserting the 
     following: ``Act;
       ``(C) the''; and
       (4) by adding at the end the following:
       ``(D) notwithstanding any other provision of law, the 
     address, social security number, and, if available, 
     photograph of any member of a household shall be made 
     available, on request, to any Federal, State, or local law 
     enforcement officer if the officer furnishes the State agency 
     with the name of the member and notifies the agency that--
       ``(i) the member--

       ``(I) is fleeing to avoid prosecution, or custody or 
     confinement after conviction, for a crime (or attempt to 
     commit a crime) that, under the law of the place the member 
     is fleeing, is a felony (or, in the case of New Jersey, a 
     high misdemeanor), or is violating a condition of probation 
     or parole imposed under Federal or State law; or
       ``(II) has information that is necessary for the officer to 
     conduct an official duty related to subclause (I);

       ``(ii) locating or apprehending the member is an official 
     duty; and
       ``(iii) the request is being made in the proper exercise of 
     an official duty; and
       ``(E) the safeguards shall not prevent compliance with 
     paragraph (16);''.

     SEC. 1047. EXPEDITED COUPON SERVICE.

       Section 11(e)(9) of the Food Stamp Act of 1977 (7 U.S.C. 
     2020(e)(9)) is amended--
       (1) in subparagraph (A)--
       (A) by striking ``five days'' and inserting ``7 days''; and
       (B) by inserting ``and'' at the end;
       (2) by striking subparagraphs (B) and (C);
       (3) by redesignating subparagraph (D) as subparagraph (B); 
     and
       (4) in subparagraph (B), as redesignated by paragraph (3), 
     by striking ``, (B), or (C)''.

     SEC. 1048. WITHDRAWING FAIR HEARING REQUESTS.

       Section 11(e)(10) of the Food Stamp Act of 1977 (7 U.S.C. 
     2020(e)(10)) is amended by inserting before the semicolon at 
     the end a period and the following: ``At the option of a 
     State, at any time prior to a fair hearing determination 
     under this paragraph, a household may withdraw, orally or in 
     writing, a request by the household for the fair hearing. If 
     the withdrawal request is an oral request, the State agency 
     shall provide a written notice to the household confirming 
     the withdrawal request and providing the household with an 
     opportunity to request a hearing''.

     SEC. 1049. INCOME, ELIGIBILITY, AND IMMIGRATION STATUS 
                   VERIFICATION SYSTEMS.

       Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020) is 
     amended--
       (1) in subsection (e)(18), as redesignated by section 
     1044(1)(D)--
       (A) by striking ``that information is'' and inserting ``at 
     the option of the State agency, that information may be''; 
     and
       (B) by striking ``shall be requested'' and inserting ``may 
     be requested''; and
       (2) by adding at the end the following:
       ``(p) State Verification Option.--Notwithstanding any other 
     provision of law, in carrying out the food stamp program, a 
     State agency shall not be required to use an income and 
     eligibility or an immigration status verification system 
     established under section 1137 of the Social Security Act (42 
     U.S.C. 1320b-7).''.

     SEC. 1050. DISQUALIFICATION OF RETAILERS WHO INTENTIONALLY 
                   SUBMIT FALSIFIED APPLICATIONS.

       Section 12(b) of the Food Stamp Act of 1977 (7 U.S.C. 
     2021(b)) is amended--
       (1) in paragraph (2), by striking ``and'' at the end;
       (2) in paragraph (3), by striking the period at the end and 
     inserting ``; and''; and
       (3) by adding at the end the following:
       ``(4) for a reasonable period of time to be determined by 
     the Secretary, including permanent disqualification, on the 
     knowing submission of an application for the approval or 
     reauthorization to accept and redeem coupons that contains 
     false information about a substantive matter that was a part 
     of the application.''.

     SEC. 1051. DISQUALIFICATION OF RETAILERS WHO ARE DISQUALIFIED 
                   UNDER THE WIC PROGRAM.

       Section 12 of the Food Stamp Act of 1977 (7 U.S.C. 2021) is 
     amended by adding at the end the following:
       ``(g) Disqualification of Retailers Who Are Disqualified 
     Under the WIC Program.--
       ``(1) In general.--The Secretary shall issue regulations 
     providing criteria for the disqualification under this Act of 
     an approved retail food store and a wholesale food concern 
     that is disqualified from accepting benefits under the 
     special supplemental nutrition program for women, infants, 
     and children established under section 17 of the Child 
     Nutrition Act of 1966 (7 U.S.C. 1786).
       ``(2) Terms.--A disqualification under paragraph (1)--
       ``(A) shall be for the same length of time as the 
     disqualification from the program referred to in paragraph 
     (1);
       ``(B) may begin at a later date than the disqualification 
     from the program referred to in paragraph (1); and
       ``(C) notwithstanding section 14, shall not be subject to 
     judicial or administrative review.''.

     SEC. 1052. COLLECTION OF OVERISSUANCES.

       (a) Collection of Overissuances.--Section 13 of the Food 
     Stamp Act of 1977 (7 U.S.C. 2022) is amended--
       (1) by striking subsection (b) and inserting the following:
       ``(b) Collection of Overissuances.--
       ``(1) In general.--Except as otherwise provided in this 
     subsection, a State agency shall collect any overissuance of 
     coupons issued to a household by--
       ``(A) reducing the allotment of the household;
       ``(B) withholding amounts from unemployment compensation 
     from a member of the household under subsection (c);
       ``(C) recovering from Federal pay or a Federal income tax 
     refund under subsection (d); or
       ``(D) any other means.
       ``(2) Cost effectiveness.--Paragraph (1) shall not apply if 
     the State agency demonstrates to the satisfaction of the 
     Secretary that all of the means referred to in paragraph (1) 
     are not cost effective.
       ``(3) Maximum reduction absent fraud.--If a household 
     received an overissuance of coupons without any member of the 
     household being found ineligible to participate in the 
     program under section 6(b)(1) and a State agency elects to 
     reduce the allotment of the household under paragraph (1)(A), 
     the State agency shall not reduce the monthly allotment of 
     the household under paragraph (1)(A) by an amount in excess 
     of the greater of--
       ``(A) 10 percent of the monthly allotment of the household; 
     or
       ``(B) $10.
       ``(4) Procedures.--A State agency shall collect an 
     overissuance of coupons issued to a household under paragraph 
     (1) in accordance with the requirements established by the 
     State agency for providing notice, electing a means of 
     payment, and establishing a time schedule for payment.''; and
       (2) in subsection (d)--
       (A) by striking ``as determined under subsection (b) and 
     except for claims arising from an error of the State 
     agency,'' and inserting ``, as determined under subsection 
     (b)(1),''; and
       (B) by inserting before the period at the end the 
     following: ``or a Federal income tax refund as authorized by 
     section 3720A of title 31, United States Code''.
       (b) Conforming Amendments.--Section 11(e)(8) of the Act (7 
     U.S.C. 2020(e)(8)) is amended--
       (1) by striking ``and excluding claims'' and all that 
     follows through ``such section''; and
       (2) by inserting before the semicolon at the end the 
     following: ``or a Federal income tax refund as authorized by 
     section 3720A of title 31, United States Code''.
       (c) Retention Rate.--Section 16(a) of the Act (7 U.S.C. 
     2025(a)) is amended by striking ``25 percent during the 
     period beginning October 1, 1990'' and all that follows 
     through ``error of a State agency'' and inserting the 
     following: ``25 percent of the overissuances collected by the 
     State agency under section 13, except those overissuances 
     arising from an error of the State agency''.

     SEC. 1053. AUTHORITY TO SUSPEND STORES VIOLATING PROGRAM 
                   REQUIREMENTS PENDING ADMINISTRATIVE AND 
                   JUDICIAL REVIEW.

       Section 14(a) of the Food Stamp Act of 1977 (7 U.S.C. 
     2023(a)) is amended--
       (1) by redesignating the first through seventeenth 
     sentences as paragraphs (1) through (17), respectively; and
       (2) by adding at the end the following:
       ``(18) Suspension of stores pending review.--
     Notwithstanding any other provision of this subsection, any 
     permanent disqualification of a retail food store or 
     wholesale food concern under paragraph (3) or (4) of section 
     12(b) shall be effective from the date of receipt of the 
     notice of disqualification. If the disqualification is 
     reversed through administrative or judicial review, the 
     Secretary shall not be liable for the value of any sales lost 
     during the disqualification period.''.

     SEC. 1054. EXPANDED CRIMINAL FORFEITURE FOR VIOLATIONS.

       (a) Forfeiture of Items Exchanged in Food Stamp 
     Trafficking.--The first sentence of section 15(g) of the Food 
     Stamp Act of 1977 (7 U.S.C. 2024(g)) is amended by striking 
     ``or intended to be furnished''.
       (b) Criminal Forfeiture.--Section 15 of the Act (7 U.S.C. 
     2024) is amended by adding at the end the following:
       ``(h) Criminal Forfeiture.--

[[Page H7828]]

       ``(1) In general.--In imposing a sentence on a person 
     convicted of an offense in violation of subsection (b) or 
     (c), a court shall order, in addition to any other sentence 
     imposed under this subsection, that the person forfeit to the 
     United States all property described in paragraph (2).
       ``(2) Property subject to forfeiture.--All property, real 
     and personal, used in a transaction or attempted transaction, 
     to commit, or to facilitate the commission of, a violation 
     (other than a misdemeanor) of subsection (b) or (c), or 
     proceeds traceable to a violation of subsection (b) or (c), 
     shall be subject to forfeiture to the United States under 
     paragraph (1).
       ``(3) Interest of owner.--No interest in property shall be 
     forfeited under this subsection as the result of any act or 
     omission established by the owner of the interest to have 
     been committed or omitted without the knowledge or consent of 
     the owner.
       ``(4) Proceeds.--The proceeds from any sale of forfeited 
     property and any monies forfeited under this subsection shall 
     be used--
       ``(A) first, to reimburse the Department of Justice for the 
     costs incurred by the Department to initiate and complete the 
     forfeiture proceeding;
       ``(B) second, to reimburse the Department of Agriculture 
     Office of Inspector General for any costs the Office incurred 
     in the law enforcement effort resulting in the forfeiture;
       ``(C) third, to reimburse any Federal or State law 
     enforcement agency for any costs incurred in the law 
     enforcement effort resulting in the forfeiture; and
       ``(D) fourth, by the Secretary to carry out the approval, 
     reauthorization, and compliance investigations of retail 
     stores and wholesale food concerns under section 9.''.

     SEC. 1055. LIMITATION OF FEDERAL MATCH.

       Section 16(a)(4) of the Food Stamp Act of 1977 (7 U.S.C. 
     2025(a)(4)) is amended by inserting after the comma at the 
     end the following: ``but not including recruitment 
     activities,''.

     SEC. 1056. STANDARDS FOR ADMINISTRATION.

       (a) In General.--Section 16 of the Food Stamp Act of 1977 
     (7 U.S.C. 2025) is amended by striking subsection (b).
       (b) Conforming Amendments.--
       (1) The first sentence of section 11(g) of the Act (7 
     U.S.C. 2020(g)) is amended by striking ``the Secretary's 
     standards for the efficient and effective administration of 
     the program established under section 16(b)(1) or''.
       (2) Section 16(c)(1)(B) of the Act (7 U.S.C. 2025(c)(1)(B)) 
     is amended by striking ``pursuant to subsection (b)''.

     SEC. 1057. WORK SUPPLEMENTATION OR SUPPORT PROGRAM.

       Section 16 of the Food Stamp Act of 1977 (7 U.S.C. 2025), 
     as amended by section 1056(a), is amended by inserting after 
     subsection (a) the following:
       ``(b) Work Supplementation or Support Program.--
       ``(1) Definition of work supplementation or support 
     program.--In this subsection, the term `work supplementation 
     or support program' means a program under which, as 
     determined by the Secretary, public assistance (including any 
     benefits provided under a program established by the State 
     and the food stamp program) is provided to an employer to be 
     used for hiring and employing a public assistance recipient 
     who was not employed by the employer at the time the public 
     assistance recipient entered the program.
       ``(2) Program.--A State agency may elect to use an amount 
     equal to the allotment that would otherwise be issued to a 
     household under the food stamp program, but for the operation 
     of this subsection, for the purpose of subsidizing or 
     supporting a job under a work supplementation or support 
     program established by the State.
       ``(3) Procedure.--If a State agency makes an election under 
     paragraph (2) and identifies each household that participates 
     in the food stamp program that contains an individual who is 
     participating in the work supplementation or support 
     program--
       ``(A) the Secretary shall pay to the State agency an amount 
     equal to the value of the allotment that the household would 
     be eligible to receive but for the operation of this 
     subsection;
       ``(B) the State agency shall expend the amount received 
     under subparagraph (A) in accordance with the work 
     supplementation or support program in lieu of providing the 
     allotment that the household would receive but for the 
     operation of this subsection;
       ``(C) for purposes of--
       ``(i) sections 5 and 8(a), the amount received under this 
     subsection shall be excluded from household income and 
     resources; and
       ``(ii) section 8(b), the amount received under this 
     subsection shall be considered to be the value of an 
     allotment provided to the household; and
       ``(D) the household shall not receive an allotment from the 
     State agency for the period during which the member continues 
     to participate in the work supplementation or support 
     program.
       ``(4) Other work requirements.--No individual shall be 
     excused, by reason of the fact that a State has a work 
     supplementation or support program, from any work requirement 
     under section 6(d), except during the periods in which the 
     individual is employed under the work supplementation or 
     support program.
       ``(5) Length of participation.--A State agency shall 
     provide a description of how the public assistance recipients 
     in the program shall, within a specific period of time, be 
     moved from supplemented or supported employment to employment 
     that is not supplemented or supported.
       ``(6) Displacement.--A work supplementation or support 
     program shall not displace the employment of individuals who 
     are not supplemented or supported.''.

     SEC. 1058. WAIVER AUTHORITY.

       Section 17(b)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
     2026(b)(1)) is amended--
       (1) by redesignating subparagraph (B) as subparagraph (C); 
     and
       (2) in subparagraph (A)--
       (A) by striking the second sentence; and
       (B) by striking ``benefits to eligible households, 
     including'' and inserting the following: ``benefits to 
     eligible households, and may waive any requirement of this 
     Act to the extent necessary for the project to be conducted.
       ``(B) Project requirements.--
       ``(i) Program goal.--The Secretary may not conduct a 
     project under subparagraph (A) unless the project is 
     consistent with the goal of the food stamp program of 
     providing food assistance to raise levels of nutrition among 
     low-income individuals.
       ``(ii) Permissible projects.--The Secretary may conduct a 
     project under subparagraph (A) to--

       ``(I) improve program administration;
       ``(II) increase the self-sufficiency of food stamp 
     recipients;
       ``(III) test innovative welfare reform strategies; and
       ``(IV) allow greater conformity with the rules of other 
     programs than would be allowed but for this paragraph.

       ``(iii) Impermissible projects.--The Secretary may not 
     conduct a project under subparagraph (A) that--

       ``(I) involves the payment of the value of an allotment in 
     the form of cash, unless the project was approved prior to 
     the date of enactment of this subparagraph;
       ``(II) substantially transfers funds made available under 
     this Act to services or benefits provided primarily through 
     another public assistance program; or
       ``(III) is not limited to a specific time period.

       ``(iv) Additional included projects.--Pilot or experimental 
     projects may include''.

     SEC. 1059. RESPONSE TO WAIVERS.

       Section 17(b)(1) of the Food Stamp Act of 1977 (7 U.S.C. 
     2026(b)(1)), as amended by section 1058, is amended by adding 
     at the end the following:
       ``(D) Response to waivers.--
       ``(i) Response.--Not later than 60 days after the date of 
     receiving a request for a waiver under subparagraph (A), the 
     Secretary shall provide a response that--

       ``(I) approves the waiver request;
       ``(II) denies the waiver request and explains any 
     modification needed for approval of the waiver request;
       ``(III) denies the waiver request and explains the grounds 
     for the denial; or
       ``(IV) requests clarification of the waiver request.

       ``(ii) Failure to respond.--If the Secretary does not 
     provide a response in accordance with clause (i), the waiver 
     shall be considered approved, unless the approval is 
     specifically prohibited by this Act.
       ``(iii) Notice of denial.--On denial of a waiver request 
     under clause (i)(III), the Secretary shall provide a copy of 
     the waiver request and a description of the reasons for the 
     denial to the Committee on Agriculture of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate.''.

     SEC. 1060. EMPLOYMENT INITIATIVES PROGRAM.

       Section 17 of the Food Stamp Act of 1977 (7 U.S.C. 2026) is 
     amended by striking subsection (d) and inserting the 
     following:
       ``(d) Employment Initiatives Program.--
       ``(1) Election to participate.--
       ``(A) In general.--Subject to the other provisions of this 
     subsection, a State may elect to carry out an employment 
     initiatives program under this subsection.
       ``(B) Requirement.--A State shall be eligible to carry out 
     an employment initiatives program under this subsection only 
     if not less than 50 percent of the households that 
     received food stamp benefits during the summer of 1993 
     also received benefits under a State program funded under 
     part A of title IV of the Social Security Act (42 U.S.C. 
     601 et seq.) during the summer of 1993.
       ``(2) Procedure.--
       ``(A) In general.--A State that has elected to carry out an 
     employment initiatives program under paragraph (1) may use 
     amounts equal to the food stamp allotments that would 
     otherwise be issued to a household under the food stamp 
     program, but for the operation of this subsection, to provide 
     cash benefits in lieu of the food stamp allotments to the 
     household if the household is eligible under paragraph (3).
       ``(B) Payment.--The Secretary shall pay to each State that 
     has elected to carry out an employment initiatives program 
     under paragraph (1) an amount equal to the value of the 
     allotment that each household would be eligible to receive 
     under this Act but for the operation of this subsection.
       ``(C) Other provisions.--For purposes of the food stamp 
     program (other than this subsection)--
       ``(i) cash assistance under this subsection shall be 
     considered to be an allotment; and
       ``(ii) each household receiving cash benefits under this 
     subsection shall not receive any other food stamp benefit for 
     the period for which the cash assistance is provided.
       ``(D) Additional payments.--Each State that has elected to 
     carry out an employment

[[Page H7829]]

     initiatives program under paragraph (1) shall--
       ``(i) increase the cash benefits provided to each household 
     under this subsection to compensate for any State or local 
     sales tax that may be collected on purchases of food by any 
     household receiving cash benefits under this subsection, 
     unless the Secretary determines on the basis of information 
     provided by the State that the increase is unnecessary on the 
     basis of the limited nature of the items subject to the State 
     or local sales tax; and
       ``(ii) pay the cost of any increase in cash benefits 
     required by clause (i).
       ``(3) Eligibility.--A household shall be eligible to 
     receive cash benefits under paragraph (2) if an adult member 
     of the household--
       ``(A) has worked in unsubsidized employment for not less 
     than the preceding 90 days;
       ``(B) has earned not less than $350 per month from the 
     employment referred to in subparagraph (A) for not less than 
     the preceding 90 days;
       ``(C)(i) is receiving benefits under a State program funded 
     under part A of title IV of the Social Security Act (42 
     U.S.C. 601 et seq.); or
       ``(ii) was receiving benefits under a State program funded 
     under part A of title IV of the Social Security Act (42 
     U.S.C. 601 et seq.) at the time the member first received 
     cash benefits under this subsection and is no longer eligible 
     for the State program because of earned income;
       ``(D) is continuing to earn not less than $350 per month 
     from the employment referred to in subparagraph (A); and
       ``(E) elects to receive cash benefits in lieu of food stamp 
     benefits under this subsection.
       ``(4) Evaluation.--A State that operates a program under 
     this subsection for 2 years shall provide to the Secretary a 
     written evaluation of the impact of cash assistance under 
     this subsection. The State agency, with the concurrence of 
     the Secretary, shall determine the content of the 
     evaluation.''.

     SEC. 1061. REAUTHORIZATION.

       The first sentence of section 18(a)(1) of the Food Stamp 
     Act of 1977 (7 U.S.C. 2027(a)(1)) is amended by striking 
     ``1991 through 1997'' and inserting ``1996 through 2002''.

     SEC. 1062. SIMPLIFIED FOOD STAMP PROGRAM.

       (a) In General.--The Food Stamp Act of 1977 (7 U.S.C. 2011 
     et seq.) is amended by adding at the end the following:

     ``SEC. 26. SIMPLIFIED FOOD STAMP PROGRAM.

       ``(a) Definition of Federal Costs.--In this section, the 
     term `Federal costs' does not include any Federal costs 
     incurred under section 17.
       ``(b) Election.--Subject to subsection (d), a State may 
     elect to carry out a Simplified Food Stamp Program (referred 
     to in this section as a `Program'), statewide or in a 
     political subdivision of the State, in accordance with this 
     section.
       ``(c) Operation of Program.--If a State elects to carry out 
     a Program, within the State or a political subdivision of the 
     State--
       ``(1) a household in which all members receive assistance 
     under a State program funded under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.) shall 
     automatically be eligible to participate in the Program; and
       ``(2) subject to subsection (f), benefits under the Program 
     shall be determined under rules and procedures established by 
     the State under--
       ``(A) a State program funded under part A of title IV of 
     the Social Security Act (42 U.S.C. 601 et seq.);
       ``(B) the food stamp program (other than section 27); or
       ``(C) a combination of a State program funded under part A 
     of title IV of the Social Security Act (42 U.S.C. 601 et 
     seq.) and the food stamp program (other than section 27).
       ``(d) Approval of Program.--
       ``(1) State plan.--A State agency may not operate a Program 
     unless the Secretary approves a State plan for the operation 
     of the Program under paragraph (2).
       ``(2) Approval of plan.--The Secretary shall approve any 
     State plan to carry out a Program if the Secretary determines 
     that the plan--
       ``(A) complies with this section; and
       ``(B) contains sufficient documentation that the plan will 
     not increase Federal costs for any fiscal year.
       ``(e) Increased Federal Costs.--
       ``(1) Determination.--During each fiscal year and not later 
     than 90 days after the end of each fiscal year, the Secretary 
     shall determine whether a Program being carried out by a 
     State agency is increasing Federal costs under this Act above 
     the Federal costs incurred under the food stamp program in 
     operation in the State or political subdivision of the State 
     for the fiscal year prior to the implementation of the 
     Program, adjusted for any changes in--
       ``(A) participation;
       ``(B) the income of participants in the food stamp program 
     that is not attributable to public assistance; and
       ``(C) the thrifty food plan under section 3(o).
       ``(2) Notification.--If the Secretary determines that the 
     Program has increased Federal costs under this Act for any 
     fiscal year or any portion of any fiscal year, the Secretary 
     shall notify the State not later than 30 days after the 
     Secretary makes the determination under paragraph (1).
       ``(3) Enforcement.--
       ``(A) Corrective action.--Not later than 90 days after the 
     date of a notification under paragraph (2), the State shall 
     submit a plan for approval by the Secretary for prompt 
     corrective action that is designed to prevent the Program 
     from increasing Federal costs under this Act.
       ``(B) Termination.--If the State does not submit a plan 
     under subparagraph (A) or carry out a plan approved by the 
     Secretary, the Secretary shall terminate the approval of the 
     State agency operating the Program and the State agency shall 
     be ineligible to operate a future Program.
       ``(f) Rules and Procedures.--
       ``(1) In general.--In operating a Program, a State or 
     political subdivision of a State may follow the rules and 
     procedures established by the State or political subdivision 
     under a State program funded under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.) or under the food 
     stamp program.
       ``(2) Standardized deductions.--In operating a Program, a 
     State or political subdivision of a State may standardize the 
     deductions provided under section 5(e). In developing the 
     standardized deduction, the State shall consider the work 
     expenses, dependent care costs, and shelter costs of 
     participating households.
       ``(3) Requirements.--In operating a Program, a State or 
     political subdivision shall comply with the requirements of--
       ``(A) subsections (a) through (g) of section 7;
       ``(B) section 8(a) (except that the income of a household 
     may be determined under a State program funded under part A 
     of title IV of the Social Security Act (42 U.S.C. 601 et 
     seq.));
       ``(C) subsection (b) and (d) of section 8;
       ``(D) subsections (a), (c), (d), and (n) of section 11;
       ``(E) paragraphs (8), (12), (16), (18), (20), (24), and 
     (25) of section 11(e);
       ``(F) section 11(e)(10) (or a comparable requirement 
     established by the State under a State program funded under 
     part A of title IV of the Social Security Act (42 U.S.C. 601 
     et seq.)); and
       ``(G) section 16.
       ``(4) Limitation on eligibility.--Notwithstanding any other 
     provision of this section, a household may not receive 
     benefits under this section as a result of the eligibility of 
     the household under a State program funded under part A of 
     title IV of the Social Security Act (42 U.S.C. 601 et seq.), 
     unless the Secretary determines that any household with 
     income above 130 percent of the poverty guidelines is not 
     eligible for the program.''.
       (b) State Plan Provisions.--Section 11(e) of the Act (7 
     U.S.C. 2020(e)), as amended by sections 1020(b), 1028(b), and 
     1044, is amended by adding at the end the following:
       ``(25) if a State elects to carry out a Simplified Food 
     Stamp Program under section 26, the plans of the State agency 
     for operating the program, including--
       ``(A) the rules and procedures to be followed by the State 
     agency to determine food stamp benefits;
       ``(B) how the State agency will address the needs of 
     households that experience high shelter costs in relation to 
     the incomes of the households; and
       ``(C) a description of the method by which the State agency 
     will carry out a quality control system under section 
     16(c).''.
       (c) Conforming Amendments.--
       (1) Section 8 of the Act (7 U.S.C. 2017), as amended by 
     section 1039, is amended--
       (A) by striking subsection (e); and
       (B) by redesignating subsection (f) as subsection (e).
       (2) Section 17 of the Act (7 U.S.C. 2026) is amended--
       (A) by striking subsection (i); and
       (B) by redesignating subsections (j) through (l) as 
     subsections (i) through (k), respectively.

     SEC. 1063. STATE FOOD ASSISTANCE BLOCK GRANT.

       (a) In General.--The Food Stamp Act of 1977 (7 U.S.C. 2011 
     et seq.), as amended by section 1062, is amended by adding at 
     the end the following:

     ``SEC. 27. STATE FOOD ASSISTANCE BLOCK GRANT.

       ``(a) Definitions.--In this section:
       ``(1) Food assistance.--The term `food assistance' means 
     assistance that may be used only to obtain food, as defined 
     in section 3(g).
       ``(2) State.--The term `State' means each of the 50 States, 
     the District of Columbia, Guam, and the Virgin Islands of the 
     United States.
       ``(b) Establishment.--The Secretary shall establish a 
     program to make grants to States in accordance with this 
     section to provide--
       ``(1) food assistance to needy individuals and families 
     residing in the State; and
       ``(2) funds for administrative costs incurred in providing 
     the assistance.
       ``(c) Election.--
       ``(1) In general.--A State may annually elect to 
     participate in the program established under subsection (b) 
     if the State--
       ``(A) has fully implemented an electronic benefit transfer 
     system that operates in the entire State;
       ``(B) has a payment error rate under section 16(c) that is 
     not more than 6 percent as announced most recently by the 
     Secretary; or
       ``(C) has a payment error rate in excess of 6 percent and 
     agrees to contribute non-Federal funds for the fiscal year of 
     the grant, for

[[Page H7830]]

     benefits and administration of the State's food assistance 
     program, the amount determined under paragraph (2).
       ``(2) State mandatory contributions.--
       ``(A) In general.--In the case of a State that elects to 
     participate in the program under paragraph (1)(C), the State 
     shall agree to contribute, for a fiscal year, an amount equal 
     to--
       ``(i) the benefits issued in the State; multiplied by
       ``(ii) the payment error rate of the State; minus
       ``(B)(i) the benefits issued in the State; multiplied by
       ``(ii) 6 percent.
       ``(B) Determination.--Notwithstanding sections 13 and 14, 
     the calculation of the contribution shall be based solely on 
     the determination of the Secretary of the payment error rate.
       ``(C) Data.--For purposes of implementing subparagraph (A) 
     for a fiscal year, the Secretary shall use the data for the 
     most recent fiscal year available.
       ``(3) Election limitation.--
       ``(A) Re-entering food stamp program.--A State that elects 
     to participate in the program under paragraph (1) may in a 
     subsequent year decline to elect to participate in the 
     program and instead participate in the food stamp program in 
     accordance with the other sections of this Act.
       ``(B) Limitation.--Subsequent to re-entering the food stamp 
     program under subparagraph (A), the State shall only be 
     eligible to participate in the food stamp program in 
     accordance with the other sections of this Act and shall not 
     be eligible to elect to participate in the program 
     established under subsection (b).
       ``(4) Program exclusive.--
       ``(A) In general.--A State that is participating in the 
     program established under subsection (b) shall not be subject 
     to, or receive any benefit under, this Act except as provided 
     in this section.
       ``(B) Contract with federal government.--Nothing in this 
     section shall prohibit a State from contracting with the 
     Federal Government for the provision of services or materials 
     necessary to carry out a program under this section.
       ``(d) Lead Agency.--A State desiring to receive a grant 
     under this section shall designate, in an application 
     submitted to the Secretary under subsection (e)(1), an 
     appropriate State agency responsible for the 
     administration of the program under this section as the 
     lead agency.
       ``(e) Application and Plan.--
       ``(1) Application.--To be eligible to receive assistance 
     under this section, a State shall prepare and submit to the 
     Secretary an application at such time, in such manner, and 
     containing such information as the Secretary shall by 
     regulation require, including--
       ``(A) an assurance that the State will comply with the 
     requirements of this section;
       ``(B) a State plan that meets the requirements of paragraph 
     (3); and
       ``(C) an assurance that the State will comply with the 
     requirements of the State plan under paragraph (3).
       ``(2) Annual plan.--The State plan contained in the 
     application under paragraph (1) shall be submitted for 
     approval annually.
       ``(3) Requirements of plan.--
       ``(A) Lead agency.--The State plan shall identify the lead 
     agency.
       ``(B) Use of block grant funds.--The State plan shall 
     provide that the State shall use the amounts provided to the 
     State for each fiscal year under this section--
       ``(i) to provide food assistance to needy individuals and 
     families residing in the State, other than residents of 
     institutions who are ineligible for food stamps under section 
     3(i); and
       ``(ii) to pay administrative costs incurred in providing 
     the assistance.
       ``(C) Groups served.--The State plan shall describe how and 
     to what extent the program will serve specific groups of 
     individuals and families and how the treatment will differ 
     from treatment under the food stamp program under the other 
     sections of this Act of the individuals and families, 
     including--
       ``(i) elderly individuals and families;
       ``(ii) migrants or seasonal farmworkers;
       ``(iii) homeless individuals and families;
       ``(iv) individuals and families who live in institutions 
     eligible under section 3(i);
       ``(v) individuals and families with earnings; and
       ``(vi) members of Indian tribes or tribal organizations.
       ``(D) Assistance for entire state.--The State plan shall 
     provide that benefits under this section shall be available 
     throughout the entire State.
       ``(E) Notice and hearings.--The State plan shall provide 
     that an individual or family who applies for, or receives, 
     assistance under this section shall be provided with notice 
     of, and an opportunity for a hearing on, any action under 
     this section that adversely affects the individual or family.
       ``(F) Assessment of Needs.--The State plan shall assess the 
     food and nutrition needs of needy persons residing in the 
     State.
       ``(G) Eligibility standards.--The State plan shall describe 
     the income, resource, and other eligibility standards that 
     are established for the receipt of assistance under this 
     section.
       ``(H) Disqualification of fleeing felons.--The State plan 
     shall provide for the disqualification of any individual who 
     would be disqualified from participating in the food stamp 
     program under section 6(k).
       ``(I) Receiving benefits in more than 1 jurisdiction.--The 
     State plan shall establish a system for the exchange of 
     information with other States to verify the identity and 
     receipt of benefits by recipients.
       ``(J) Privacy.--The State plan shall provide for 
     safeguarding and restricting the use and disclosure 
     of information about any individual or family receiving 
     assistance under this section.
       ``(K) Other information.--The State plan shall contain such 
     other information as may be required by the Secretary.
       ``(4) Approval of application and plan.--The Secretary 
     shall approve an application and State plan that satisfies 
     the requirements of this section.
       ``(f) No Individual or Family Entitlement to Assistance.--
     Nothing in this section--
       ``(1) entitles any individual or family to assistance under 
     this section; or
       ``(2) limits the right of a State to impose additional 
     limitations or conditions on assistance under this section.
       ``(g) Benefits for Aliens.--
       ``(1) Eligibility.--No individual who is an alien shall be 
     eligible to receive benefits under a State plan approved 
     under subsection (e)(4) if the individual is not eligible to 
     participate in the food stamp program due to the alien status 
     of the individual.
       ``(2) Income.--The State plan shall provide that the income 
     of an alien shall be determined in accordance with section 
     5(i).
       ``(h) Employment and Training.--
       ``(1) Work requirements.--No individual or household shall 
     be eligible to receive benefits under a State plan funded 
     under this section if the individual or household is not 
     eligible to participate in the food stamp program under 
     subsection (d) or (o) of section 6.
       ``(2) Work programs.--Each State shall implement an 
     employment and training program in accordance with the terms 
     and conditions of section 6(d)(4) for individuals under the 
     program and shall be eligible to receive funding under 
     section 16(h).
       ``(i) Enforcement.--
       ``(1) Review of compliance with state plan.--The Secretary 
     shall review and monitor State compliance with this section 
     and the State plan approved under subsection (e)(4).
       ``(2) Noncompliance.--
       ``(A) In general.--If the Secretary, after reasonable 
     notice to a State and opportunity for a hearing, finds that--
       ``(i) there has been a failure by the State to comply 
     substantially with any provision or requirement set forth in 
     the State plan approved under subsection (e)(4); or
       ``(ii) in the operation of any program or activity for 
     which assistance is provided under this section, there is a 
     failure by the State to comply substantially with any 
     provision of this section;

     the Secretary shall notify the State of the finding and that 
     no further grants will be made to the State under this 
     section (or, in the case of noncompliance in the operation of 
     a program or activity, that no further grants to the State 
     will be made with respect to the program or activity) until 
     the Secretary is satisfied that there is no longer any 
     failure to comply or that the noncompliance will be promptly 
     corrected.
       ``(B) Other penalties.--In the case of a finding of 
     noncompliance made pursuant to subparagraph (A), the 
     Secretary may, in addition to, or in lieu of, imposing the 
     penalties described in subparagraph (A), impose other 
     appropriate penalties, including recoupment of money 
     improperly expended for purposes prohibited or not authorized 
     by this section and disqualification from the receipt of 
     financial assistance under this section.
       ``(C) Notice.--The notice required under subparagraph (A) 
     shall include a specific identification of any additional 
     penalty being imposed under subparagraph (B).
       ``(3) Issuance of regulations.--The Secretary shall 
     establish by regulation procedures for--
       ``(A) receiving, processing, and determining the validity 
     of complaints made to the Secretary concerning any failure of 
     a State to comply with the State plan or any requirement of 
     this section; and
       ``(B) imposing penalties under this section.
       ``(j) Grant.--
       ``(1) In general.--For each fiscal year, the Secretary 
     shall pay to a State that has an application approved by the 
     Secretary under subsection (e)(4) an amount that is equal to 
     the grant of the State under subsection (m) for the fiscal 
     year.
       ``(2) Method of grant.--The Secretary shall make a grant to 
     a State for a fiscal year under this section by issuing 1 or 
     more letters of credit for the fiscal year, with necessary 
     adjustments on account of overpayments or underpayments, as 
     determined by the Secretary.
       ``(3) Spending of grants by state.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     a grant to a State determined under subsection (m)(1) for a 
     fiscal year may be expended by the State only in the fiscal 
     year.
       ``(B) Carryover.--The State may reserve up to 10 percent of 
     a grant determined under subsection (m)(1) for a fiscal year 
     to provide assistance under this section in subsequent fiscal 
     years, except that the reserved funds may not exceed 30 
     percent of the total grant received under this section for a 
     fiscal year.
       ``(4) Food assistance and administrative expenditures.--In 
     each fiscal year, not more than 6 percent of the Federal and 
     State funds required to be expended by a State under

[[Page H7831]]

     this section shall be used for administrative expenses.
       ``(5) Provision of food assistance.--A State may provide 
     food assistance under this section in any manner determined 
     appropriate by the State, such as electronic benefit transfer 
     limited to food purchases, coupons limited to food purchases, 
     or direct provision of commodities.
       ``(k) Quality Control.--Each State participating in the 
     program established under this section shall maintain a 
     system in accordance with, and shall be subject to section 
     16(c), including sanctions and eligibility for incentive 
     payment under section 16(c), adjusted for State specific 
     characteristics under regulations issued by the Secretary.
       ``(l) Nondiscrimination.--
       ``(1) In general.--The Secretary shall not provide 
     financial assistance for any program, project, or activity 
     under this section if any person with responsibilities for 
     the operation of the program, project, or activity 
     discriminates with respect to the program, project, or 
     activity because of race, religion, color, national origin, 
     sex, or disability.
       ``(2) Enforcement.--The powers, remedies, and procedures 
     set forth in title VI of the Civil Rights Act of 1964 (42 
     U.S.C. 2000d et seq.) may be used by the Secretary to enforce 
     paragraph (1).
       ``(m) Grant Calculation.--
       ``(1) State grant.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     from the amounts made available under section 18 for each 
     fiscal year, the Secretary shall provide a grant to each 
     State participating in the program established under this 
     section an amount that is equal to the sum of--
       ``(i) the greater of, as determined by the Secretary--

       ``(I) the total dollar value of all benefits issued under 
     the food stamp program established under this Act by the 
     State during fiscal year 1994; or
       ``(II) the average per fiscal year of the total dollar 
     value of all benefits issued under the food stamp program by 
     the State during each of fiscal years 1992 through 1994; and

       ``(ii) the greater of, as determined by the Secretary--

       ``(I) the total amount received by the State for 
     administrative costs under section 16(a) (not including any 
     adjustment under section 16(c)) for fiscal year 1994; or
       ``(II) the average per fiscal year of the total amount 
     received by the State for administrative costs under section 
     16(a) (not including any adjustment under section 16(c)) for 
     each of fiscal years 1992 through 1994.

       ``(B) Insufficient funds.--If the Secretary finds that the 
     total amount of grants to which States would otherwise be 
     entitled for a fiscal year under subparagraph (A) will exceed 
     the amount of funds that will be made available to provide 
     the grants for the fiscal year, the Secretary shall reduce 
     the grants made to States under this subsection, on a pro 
     rata basis, to the extent necessary.
       ``(2) Reduction.--The Secretary shall reduce the grant of a 
     State by the amount a State has agreed to contribute under 
     subsection (c)(1)(C).''.
       (b) Employment and Training Funding.--Section 16(h) of the 
     Act (7 U.S.C. 2025(a)), as amended by section 1027(d)(2), is 
     amended by adding at the end the following:
       ``(6) Block grant states.--Each State electing to operate a 
     program under section 27 shall--
       ``(A) receive the greater of--
       ``(i) the total dollar value of the funds received under 
     paragraph (1) by the State during fiscal year 1994; or
       ``(ii) the average per fiscal year of the total dollar 
     value of all funds received under paragraph (1) by the State 
     during each of fiscal years 1992 through 1994; and
       ``(B) be eligible to receive funds under paragraph (2), 
     within the limitations in section 6(d)(4)(K).''.
       (c) Research on Optional State Food Assistance Block 
     Grant.--Section 17 of the Act (7 U.S.C. 2026), as amended by 
     section 1062(c)(2), is amended by adding at the end the 
     following:
       ``(l) Research on Optional State Food Assistance Block 
     Grant.--The Secretary may conduct research on the effects and 
     costs of a State program carried out under section 27.''.

     SEC. 1064. A STUDY OF THE USE OF FOOD STAMPS TO PURCHASE 
                   VITAMINS AND MINERALS.

       The Secretary of Agriculture shall, in consultation with 
     the National Academy of Sciences and the Center for Disease 
     Control and Prevention, conduct a study of the use of food 
     stamps to purchase vitamins and minerals. The study shall 
     include an analysis of scientific findings on the efficacy of 
     and need for vitamins and minerals, including the adequacy of 
     vitamin and mineral intake in low income populations, as 
     shown by existing research and surveys, and the potential 
     value of nutritional supplements in filling nutrient gaps 
     that may exist in the population as a whole or in vulnerable 
     subgroups in the U.S. population; the impact of nutritional 
     improvements (including vitamin or mineral supplementation) 
     on health status and health care costs for women of 
     childbearing age, pregnant or lactating women, and the 
     elderly; the cost of vitamin and mineral supplements 
     commercially available; the purchasing habits of low income 
     populations with regard to vitamins and minerals; the impact 
     on the food purchases of low income households; and the 
     economic impact on agricultural commodities. The Secretary 
     shall report the results of the study to the Committee on 
     Agriculture of the U.S. House of Representatives not later 
     than December 15, 1996.''.

     SEC. 1065. INVESTIGATIONS.

       Section 12(a) of the Food Stamp Act of 1977 (7 U.S.C. 
     2021(a)) is amended by adding at the end the following:
     ``Regulations issued pursuant to this Act shall provide 
     criteria for the finding of violations and the suspension or 
     disqualification of a retail food store or wholesale food 
     concern on the basis of evidence which may include, but is 
     not limited to, facts established through on-site 
     investigations, inconsistent redemption data or evidence 
     obtained through transaction reports under electronic 
     benefit transfer systems.''.

     SEC. 1066. FOOD STAMP ELIGIBILITY.

       Section 6(f) of the Food Stamp Act of 1977 (7 U.S.C. 
     2015(f)) is amended by striking the third sentence and 
     inserting the following:
     ``The State agency shall, at its option, consider either all 
     income and financial resources of the individual rendered 
     ineligible to participate in the food stamp program under 
     this subsection, or such income, less a pro rata share, and 
     the financial resources of the ineligible individual, to 
     determine the eligibility and the value of the allotment of 
     the household of which such individual is a member.''.

     SEC. 1067. REPORT BY THE SECRETARY.

       The Secretary of Agriculture may report to the Committee on 
     Agriculture of the House of Representatives, not later than 
     January 1, 2000, on the effect of the food stamp reforms in 
     the Welfare and Medicaid Reform Act of 1996 and the ability 
     of State and local governments to deal with people in 
     poverty. The report must answer the question: ``Did people 
     become more personally responsible and were work 
     opportunities provided such that poverty in America is better 
     managed?''.

     SEC. 1068. DEFICIT REDUCTION.

       It is the sense of the Committee on Agriculture of the 
     House of Representatives that reductions in outlays resulting 
     from this title shall not be taken into account for purposes 
     of section 552 of the Balanced Budget and Emergency Deficit 
     Control Act of 1985.
              Subtitle B--Commodity Distribution Programs

     SEC. 1071. EMERGENCY FOOD ASSISTANCE PROGRAM.

       (a) Definitions.--Section 201A of the Emergency Food 
     Assistance Act of 1983 (Public Law 98-8; 7 U.S.C. 612c note) 
     is amended to read as follows:

     ``SEC. 201A. DEFINITIONS.

       ``In this Act:
       ``(1) Additional commodities.--The term `additional 
     commodities' means commodities made available under section 
     214 in addition to the commodities made available under 
     sections 202 and 203D.
       ``(2) Average monthly number of unemployed persons.--The 
     term `average monthly number of unemployed persons' means the 
     average monthly number of unemployed persons in each State in 
     the most recent fiscal year for which information concerning 
     the number of unemployed persons is available, as determined 
     by the Bureau of Labor Statistics of the Department of Labor.
       ``(3) Eligible recipient agency.--The term `eligible 
     recipient agency' means a public or nonprofit organization--
       ``(A) that administers--
       ``(i) an emergency feeding organization;
       ``(ii) a charitable institution (including a hospital and a 
     retirement home, but excluding a penal institution) to the 
     extent that the institution serves needy persons;
       ``(iii) a summer camp for children, or a child nutrition 
     program providing food service;
       ``(iv) a nutrition project operating under the Older 
     Americans Act of 1965 (42 U.S.C. 3001 et seq.), including a 
     project that operates a congregate nutrition site and a 
     project that provides home-delivered meals; or
       ``(v) a disaster relief program;
       ``(B) that has been designated by the appropriate State 
     agency, or by the Secretary; and
       ``(C) that has been approved by the Secretary for 
     participation in the program established under this Act.
       ``(4) Emergency feeding organization.--The term `emergency 
     feeding organization' means a public or nonprofit 
     organization that administers activities and projects 
     (including the activities and projects of a charitable 
     institution, a food bank, a food pantry, a hunger relief 
     center, a soup kitchen, or a similar public or private 
     nonprofit eligible recipient agency) providing nutrition 
     assistance to relieve situations of emergency and distress 
     through the provision of food to needy persons, including 
     low-income and unemployed persons.
       ``(5) Food bank.--The term `food bank' means a public or 
     charitable institution that maintains an established 
     operation involving the provision of food or edible 
     commodities, or the products of food or edible commodities, 
     to food pantries, soup kitchens, hunger relief centers, or 
     other food or feeding centers that, as an integral part of 
     their normal activities, provide meals or food to feed needy 
     persons on a regular basis.
       ``(6) Food pantry.--The term `food pantry' means a public 
     or private nonprofit organization that distributes food to 
     low-income and unemployed households, including food from 
     sources other than the Department of Agriculture, to relieve 
     situations of emergency and distress.

[[Page H7832]]

       ``(7) Poverty line.--The term `poverty line' has the same 
     meaning given the term in section 673(2) of the Community 
     Services Block Grant Act (42 U.S.C. 9902(2)).
       ``(8) Soup kitchen.--The term `soup kitchen' means a public 
     or charitable institution that, as an integral part of the 
     normal activities of the institution, maintains an 
     established feeding operation to provide food to needy 
     homeless persons on a regular basis.
       ``(9) Total value of additional commodities.--The term 
     `total value of additional commodities' means the actual cost 
     of all additional commodities made available under section 
     214 that are paid by the Secretary (including the 
     distribution and processing costs incurred by the Secretary).
       ``(10) Value of additional commodities allocated to each 
     state.--The term `value of additional commodities allocated 
     to each State' means the actual cost of additional 
     commodities made available under section 214 and allocated to 
     each State that are paid by the Secretary (including the 
     distribution and processing costs incurred by the 
     Secretary).''.
       (b) State Plan.--Section 202A of the Act (7 U.S.C. 612c 
     note) is amended to read as follows:

     ``SEC. 202A. STATE PLAN.

       ``(a) In General.--To receive commodities under this Act, a 
     State shall submit a plan of operation and administration 
     every 4 years to the Secretary for approval. The plan may be 
     amended at any time, with the approval of the Secretary.
       ``(b) Requirements.--Each plan shall--
       ``(1) designate the State agency responsible for 
     distributing the commodities received under this Act;
       ``(2) set forth a plan of operation and administration to 
     expeditiously distribute commodities under this Act;
       ``(3) set forth the standards of eligibility for recipient 
     agencies; and
       ``(4) set forth the standards of eligibility for individual 
     or household recipients of commodities, which shall require--
       ``(A) individuals or households to be comprised of needy 
     persons; and
       ``(B) individual or household members to be residing in the 
     geographic location served by the distributing agency at the 
     time of applying for assistance.
       ``(c) State Advisory Board.--The Secretary shall encourage 
     each State receiving commodities under this Act to establish 
     a State advisory board consisting of representatives of all 
     interested entities, both public and private, in the 
     distribution of commodities received under this Act in the 
     State.''.
       (c) Authorization of Appropriations for Administrative 
     Funds.--Section 204(a)(1) of the Act (7 U.S.C. 612c note) is 
     amended--
       (1) in the first sentence by striking ``for State and 
     local'' and all that follows through ``under this title'' and 
     inserting ``to pay for the direct and indirect administrative 
     costs of the State related to the processing, transporting, 
     and distributing to eligible recipient agencies 
     of commodities provided by the Secretary under this Act 
     and commodities secured from other sources''; and
       (2) by striking the fourth sentence.
       (d) Delivery of Commodities.--Section 214 of the Act (7 
     U.S.C. 612c note) is amended--
       (1) by striking subsections (a) through (e) and (j);
       (2) by redesignating subsections (f) through (i) as 
     subsections (a) through (d), respectively;
       (3) in subsection (b), as redesignated by paragraph (2)--
       (A) in the first sentence, by striking ``subsection (f) or 
     subsection (j) if applicable,'' and inserting ``subsection 
     (a)''; and
       (B) in the second sentence, by striking ``subsection (f)'' 
     and inserting ``subsection (a)'';
       (4) by striking subsection (c), as redesignated by 
     paragraph (2), and inserting the following:
       ``(c) Administration.--
       ``(1) In general.--Commodities made available for each 
     fiscal year under this section shall be delivered at 
     reasonable intervals to States based on the grants calculated 
     under subsection (a), or reallocated under subsection (b), 
     before December 31 of the following fiscal year.
       ``(2) Entitlement.--Each State shall be entitled to receive 
     the value of additional commodities determined under 
     subsection (a).''; and
       (5) in subsection (d), as redesignated by paragraph (2), by 
     striking ``or reduce'' and all that follows through ``each 
     fiscal year''.
       (e) Technical Amendments.--The Act (7 U.S.C. 612c note) is 
     amended--
       (1) in the first sentence of section 203B(a), by striking 
     ``203 and 203A of this Act'' and inserting ``203A'';
       (2) in section 204(a), by striking ``title'' each place it 
     appears and inserting ``Act'';
       (3) in the first sentence of section 210(e), by striking 
     ``(except as otherwise provided for in section 214(j))''; and
       (4) by striking section 212.
       (f) Report on EFAP.--Section 1571 of the Food Security Act 
     of 1985 (Public Law 99-198; 7 U.S.C. 612c note) is repealed.
       (g) Availability of Commodities Under the Food Stamp 
     Program.--The Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.), 
     as amended by sections 1062 and 1063, is amended by adding at 
     the end the following:

     ``SEC. 28. AVAILABILITY OF COMMODITIES FOR THE EMERGENCY FOOD 
                   ASSISTANCE PROGRAM.

       ``(a) Purchase of Commodities.--From amounts appropriated 
     under this Act, for each of fiscal years 1997 through 2002, 
     the Secretary shall purchase $300,000,000 of a variety of 
     nutritious and useful commodities of the types that the 
     Secretary has the authority to acquire through the Commodity 
     Credit Corporation or under section 32 of the Act entitled 
     `An Act to amend the Agricultural Adjustment Act, and for 
     other purposes', approved August 24, 1935 (7 U.S.C. 612c), 
     and distribute the commodities to States for distribution in 
     accordance with section 214 of the Emergency Food Assistance 
     Act of 1983 (Public Law 98-8; 7 U.S.C. 612c note).
       ``(b) Basis for Commodity Purchases.--In purchasing 
     commodities under subsection (a), the Secretary shall, to the 
     extent practicable and appropriate, make purchases based on--
       ``(1) agricultural market conditions;
       ``(2) preferences and needs of States and distributing 
     agencies; and
       ``(3) preferences of recipients.''.
       (h) Effective Date.--The amendments made by subsection (d) 
     shall become effective on October 1, 1996.

     SEC. 1072. FOOD BANK DEMONSTRATION PROJECT.

       Section 3 of the Charitable Assistance and Food Bank Act of 
     1987 (Public Law 100-232; 7 U.S.C. 612c note) is repealed.

     SEC. 1073. HUNGER PREVENTION PROGRAMS.

       The Hunger Prevention Act of 1988 (Public Law 100-435; 7 
     U.S.C. 612c note) is amended--
       (1) by striking section 110;
       (2) by striking subtitle C of title II; and
       (3) by striking section 502.

     SEC. 1074. REPORT ON ENTITLEMENT COMMODITY PROCESSING.

       Section 1773 of the Food, Agriculture, Conservation, and 
     Trade Act of 1990 (Public Law 101-624; 7 U.S.C. 612c note) is 
     amended by striking subsection (f).
            Subtitle C--Electronic Benefit Transfer Systems

     SEC. 1091. PROVISIONS TO ENCOURAGE ELECTRONIC BENEFIT 
                   TRANSFER SYSTEMS.

       Section 904 of the Electronic Fund Transfer Act (15 U.S.C. 
     1693b) is amended--
       (1) by striking ``(d) In the event'' and inserting ``(d) 
     Applicability to Service Providers Other Than Certain 
     Financial Institutions.--
       ``(1) In general.--In the event''; and
       (2) by adding at the end the following new paragraph:
       ``(2) State and local government electronic benefit 
     transfer programs.--
       ``(A) Exemption generally.--The disclosures, protections, 
     responsibilities, and remedies established under this title, 
     and any regulation prescribed or order issued by the Board in 
     accordance with this title, shall not apply to any electronic 
     benefit transfer program established under State or local law 
     or administered by a State or local government.
       ``(B) Exception for direct deposit into recipient's 
     account.--Subparagraph (A) shall not apply with respect to 
     any electronic funds transfer under an electronic benefit 
     transfer program for deposits directly into a consumer 
     account held by the recipient of the benefit.
       ``(C) Rule of construction.--No provision of this paragraph 
     may be construed as--
       ``(i) affecting or altering the protections otherwise 
     applicable with respect to benefits established by Federal, 
     State, or local law; or
       ``(ii) otherwise superseding the application of any State 
     or local law.
       ``(D) Electronic benefit transfer program defined.--For 
     purposes of this paragraph, the term `electronic benefit 
     transfer program'--
       ``(i) means a program under which a government agency 
     distributes needs-tested benefits by establishing accounts to 
     be accessed by recipients electronically, such as through 
     automated teller machines, or point-of-sale terminals; and
       ``(ii) does not include employment-related payments, 
     including salaries and pension, retirement, or unemployment 
     benefits established by Federal, State, or local 
     governments.''.
                    TITLE II--COMMITTEE ON COMMERCE

     SEC. 2000. TABLE OF CONTENTS.

       The table of contents of this title is as follows:

Sec. 2000. Table of contents.

  Subtitle A--Involvement of Commerce Committee in Federal Government 
                          Position Reductions

Sec. 2001. Involvement of Commerce Committee in Federal government 
              position reductions.

           Subtitle B--Restricting Public Benefits for Aliens

              Chapter 1--Eligibility for Federal Benefits

Sec. 2101. Aliens who are not qualified aliens ineligible for Federal 
              public benefits.
Sec. 2102. Five-year limited eligibility of qualified aliens for 
              Federal means-tested public benefit.
Sec. 2103. Notification.

                     Chapter 2--General Provisions

Sec. 2111. Definitions.
Sec. 2112. Verification of eligibility for Federal public benefits.

                     Subtitle C--Energy Assistance

Sec. 2201. Energy assistance.

                    Subtitle D--Abstinence Education

Sec. 2301. Abstinence education.

[[Page H7833]]

  Subtitle A--Involvement of Commerce Committee in Federal Government 
                          Position Reductions

     SEC. 2001. INVOLVEMENT OF COMMERCE COMMITTEE IN FEDERAL 
                   GOVERNMENT POSITION REDUCTIONS.

       In any provision of law that provides for consultation with 
     (or a report to) a relevant committee of Congress respecting 
     reductions in Federal Government positions, a reference to 
     the Committee on Commerce of the House of Representatives 
     shall be deemed to have been made in relation to matters 
     within the jurisdiction of such Committee.
           Subtitle B--Restricting Public Benefits for Aliens

              CHAPTER 1--ELIGIBILITY FOR FEDERAL BENEFITS

     SEC. 2101. ALIENS WHO ARE NOT QUALIFIED ALIENS INELIGIBLE FOR 
                   FEDERAL PUBLIC BENEFITS.

       (a) In General.--Notwithstanding any other provision of law 
     and except as provided in subsection (b), an alien who is not 
     a qualified alien (as defined in section 2111) is not 
     eligible for any Federal public benefit (as defined in 
     subsection (c)).
       (b) Exceptions.--Subsection (a) shall not apply with 
     respect to the following Federal public benefits:
       (1) Emergency medical services under title XIX of the 
     Social Security Act.
       (2)(A) Public health assistance for immunizations.
       (B) Public health assistance for testing and treatment of a 
     serious communicable disease if the Secretary of Health and 
     Human Services determines that it is necessary to prevent the 
     spread of such disease.
       (c) Federal Public Benefit Defined.--
       (1) Except as provided in paragraph (2), for purposes of 
     this part, the term ``Federal public benefit'' means--
       (A) any grant, contract, loan, professional license, or 
     commercial license provided by an agency of the United States 
     or by appropriated funds of the United States; and
       (B) any retirement, welfare, health, disability, or any 
     other similar benefit for which payments or assistance are 
     provided to an individual, household, or family eligibility 
     unit by an agency of the United States or by appropriated 
     funds of the United States,

     but only if such grant, contract, loan, or license under 
     subparagraph (A) or program providing benefits under 
     subparagraph (B) is under the jurisdiction of the Committee 
     on Commerce of the House of Representatives.
       (2) Such term shall not apply--
       (A) to any contract, professional license, or commercial 
     license for a nonimmigrant whose visa for entry is related to 
     such employment in the United States; or
       (B) with respect to benefits for an alien who as a work 
     authorized nonimmigrant or as an alien lawfully admitted for 
     permanent residence under the Immigration and Nationality Act 
     qualified for such benefits and for whom the United States 
     under reciprocal treaty agreements is required to pay 
     benefits, as determined by the Attorney General, after 
     consultation with the Secretary of State.

     SEC. 2102. FIVE-YEAR LIMITED ELIGIBILITY OF QUALIFIED ALIENS 
                   FOR FEDERAL MEANS-TESTED PUBLIC BENEFIT.

       (a) In General.--Notwithstanding any other provision of law 
     and except as provided in subsection (b), an alien who is a 
     qualified alien (as defined in section 2111) and who enters 
     the United States on or after the date of the enactment of 
     this Act is not eligible for any Federal means-tested public 
     benefit (as defined in subsection (c)) for a period of five 
     years beginning on the date of the alien's entry into the 
     United States with a status within the meaning of the term 
     ``qualified alien''.
       (b) Exceptions.--The limitation under subsection (a) shall 
     not apply to the following aliens:
       (1) Exception for refugees and asylees.--
       (A) An alien who is admitted to the United States as a 
     refugee under section 207 of the Immigration and Nationality 
     Act.
       (B) An alien who is granted asylum under section 208 of 
     such Act.
       (C) An alien whose deportation is being withheld under 
     section 243(h) of such Act.
       (2) Veteran and active duty exception.--An alien who is 
     lawfully residing in any State and is--
       (A) a veteran (as defined in section 101 of title 38, 
     United States Code) with a discharge characterized as an 
     honorable discharge and not on account of alienage,
       (B) on active duty (other than active duty for training) in 
     the Armed Forces of the United States, or
       (C) the spouse or unmarried dependent child of an 
     individual described in subparagraph (A) or (B).
       (c) Federal Means-Tested Public Benefit Defined.--
       (1) Except as provided in paragraph (2), for purposes of 
     this part, the term ``Federal means-tested public benefit'' 
     means a Federal public benefit described in section 2101(c) 
     in which the eligibility of an individual, household, or 
     family eligibility unit for benefits, or the amount of such 
     benefits, or both are determined on the basis of income, 
     resources, or financial need of the individual, household, or 
     unit.
       (2) Such term does not include the following:
       (A) Emergency medical services under title XIX of the 
     Social Security Act.
       (B)(i) Public health assistance for immunizations.
       (ii) Public health assistance for testing and treatment of 
     a serious communicable disease if the Secretary of Health and 
     Human Services determines that it is necessary to prevent the 
     spread of such disease.

     SEC. 2103. NOTIFICATION.

       Each Federal agency that administers a program to which 
     section 2101 or 2102 applies shall, directly or through the 
     States, post information and provide general notification to 
     the public and to program recipients of the changes regarding 
     eligibility for any such program pursuant to this subpart.

                     CHAPTER 2--GENERAL PROVISIONS

     SEC. 2111. DEFINITIONS.

       (a) In General.--Except as otherwise provided in this part, 
     the terms used in this part have the same meaning given such 
     terms in section 101(a) of the Immigration and Nationality 
     Act.
       (b) Qualified Alien.--For purposes of this part, the term 
     ``qualified alien'' means an alien who, at the time the alien 
     applies for, receives, or attempts to receive a Federal 
     public benefit, is--
       (1) an alien who is lawfully admitted for permanent 
     residence under the Immigration and Nationality Act,
       (2) an alien who is granted asylum under section 208 of 
     such Act,
       (3) a refugee who is admitted to the United States under 
     section 207 of such Act,
       (4) an alien who is paroled into the United States under 
     section 212(d)(5) of such Act for a period of at least 1 
     year,
       (5) an alien whose deportation is being withheld under 
     section 243(h) of such Act, or
       (6) an alien who is granted conditional entry pursuant to 
     section 203(a)(7) of such Act as in effect prior to April 1, 
     1980.

     SEC. 2112. VERIFICATION OF ELIGIBILITY FOR FEDERAL PUBLIC 
                   BENEFITS.

       (a) In General.--Not later than 18 months after the date of 
     the enactment of this Act, the Attorney General of the United 
     States, after consultation with the Secretary of Health and 
     Human Services, shall promulgate regulations requiring 
     verification that a person applying for a Federal public 
     benefit (as defined in section 2101(c)), to which the 
     limitation under section 2101 applies, is a qualified alien 
     and is eligible to receive such benefit. Such regulations 
     shall, to the extent feasible, require that information 
     requested and exchanged be similar in form and manner to 
     information requested and exchanged under section 1137 of the 
     Social Security Act.
       (b) State Compliance.--Not later than 24 months after the 
     date the regulations described in subsection (a) are adopted, 
     a State that administers a program that provides a 
     Federal public benefit shall have in effect a verification 
     system that complies with the regulations.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as may be necessary to carry out 
     the purpose of this section.
                     Subtitle C--Energy Assistance

     SEC. 2201. ENERGY ASSISTANCE.

       Section 2605(f) of the Low-Income Home Energy Assistance 
     Act of 1981 (42 U.S.C. 8624(f)) is amended--
       (1) by striking ``(f)(1) Notwithstanding'' and inserting 
     ``(f) Notwithstanding''; and
       (2) by striking paragraph (2).
                    Subtitle D--Abstinence Education

     SEC. 2301. ABSTINENCE EDUCATION.

       (a) Increases in Funding.--Section 501(a) of the Social 
     Security Act (42 U.S.C. 701(a)) is amended in the matter 
     preceding paragraph (1) by striking ``Fiscal year 1990 and 
     each fiscal year thereafter'' and inserting ``Fiscal years 
     1990 through 1995 and $761,000,000 for fiscal year 1996 and 
     each fiscal year thereafter''.
       (b) Abstinence Education.--Section 501(a)(1) of such Act 
     (42 U.S.C. 701(a)(1)) is amended--
       (1) in subparagraph (C), by striking ``and'' at the end;
       (2) in subparagraph (D), by adding ``and'' at the end; and
       (3) by adding at the end the following new subparagraph:
       ``(E) to provide abstinence education, and at the option of 
     the State, where appropriate, mentoring, counseling, and 
     adult supervision to promote abstinence from sexual activity, 
     with a focus on those groups which are most likely to bear 
     children out-of-wedlock.''.
       (c) Abstinence Education Defined.--Section 501(b) of such 
     Act (42 U.S.C. 701(b)) is amended by adding at the end the 
     following new paragraph:
       ``(5) Abstinence education.--For purposes of this 
     subsection, the term `abstinence education' means an 
     educational or motivational program which--
       ``(A) has as its exclusive purpose, teaching the social, 
     psychological, and health gains to be realized by abstaining 
     from sexual activity;
       ``(B) teaches abstinence from sexual activity outside 
     marriage as the expected standard for all school age 
     children;
       ``(C) teaches that abstinence from sexual activity is the 
     only certain way to avoid out-of-wedlock pregnancy, sexually 
     transmitted diseases, and other associated health problems;
       ``(D) teaches that a mutually faithful monogamous 
     relationship in context of marriage is the expected standard 
     of human sexual activity;

[[Page H7834]]

       ``(E) teaches that sexual activity outside of the context 
     of marriage is likely to have harmful psychological and 
     physical effects;
       ``(F) teaches that bearing children out-of-wedlock is 
     likely to have harmful consequences for the child, the 
     child's parents, and society;
       ``(G) teaches young people how to reject sexual advances 
     and how alcohol and drug use increases vulnerability to 
     sexual advances; and
       ``(H) teaches the importance of attaining self-sufficiency 
     before engaging in sexual activity.''.
       (d) Set-Aside.--
       (1) In general.--Section 502(c) of such Act (42 U.S.C. 
     702(c)) is amended in the matter preceding paragraph (1) by 
     striking ``From'' and inserting ``Except as provided in 
     subsection (e), from''.
       (2) Set-aside.--Section 502 of such Act (42 U.S.C. 702) is 
     amended by adding at the end the following new subsection:
       ``(e) Of the amounts appropriated under section 501(a) for 
     any fiscal year, the Secretary shall set aside $75,000,000 
     for abstinence education in accordance with section 
     501(a)(1)(E).''.
     TITLE III--COMMITTEE ON ECONOMIC AND EDUCATIONAL OPPORTUNITIES

     SEC. 3001. SHORT TITLE.

       This title may be cited as the ``Personal Responsibility 
     and Work Opportunity Act of 1996''.

     SEC. 3002. TABLE OF CONTENTS.

       The table of contents of this title is as follows:

Sec. 3001. Short title.
Sec. 3002. Table of contents.

                         Subtitle A--Child Care

Sec. 3101. Short title and references.
Sec. 3102. Goals.
Sec. 3103. Authorization of appropriations and entitlement authority.
Sec. 3104. Lead agency.
Sec. 3105. Application and plan.
Sec. 3106. Limitation on State allotments.
Sec. 3107. Activities to improve the quality of child care.
Sec. 3108. Repeal of early childhood development and before- and after-
              school care requirement.
Sec. 3109. Administration and enforcement.
Sec. 3110. Payments.
Sec. 3111. Annual report and audits.
Sec. 3112. Report by the Secretary.
Sec. 3113. Allotments.
Sec. 3114. Definitions.
Sec. 3115. Repeals.
Sec. 3116. Effective date.

                  Subtitle B--Child Nutrition Programs

                  Chapter 1--National School Lunch Act

Sec. 3201. State disbursement to schools.
Sec. 3202. Nutritional and other program requirements.
Sec. 3203. Free and reduced price policy statement.
Sec. 3204. Special assistance.
Sec. 3205. Miscellaneous provisions and definitions.
Sec. 3206. Summer food service program for children.
Sec. 3207. Commodity distribution.
Sec. 3208. Child care food program.
Sec. 3209. Pilot projects.
Sec. 3210. Reduction of paperwork.
Sec. 3211. Information on income eligibility.
Sec. 3212. Nutrition guidance for child nutrition programs.
Sec. 3213. Information clearinghouse.

                 Chapter 2--Child Nutrition Act of 1966

Sec. 3221. Special milk program.
Sec. 3222. Free and reduced price policy statement.
Sec. 3223. School breakfast program authorization.
Sec. 3224. State administrative expenses.
Sec. 3225. Regulations.
Sec. 3226. Prohibitions.
Sec. 3227. Miscellaneous provisions and definitions.
Sec. 3228. Accounts and records.
Sec. 3229. Special supplemental nutrition program for women, infants, 
              and children.
Sec. 3230. Cash grants for nutrition education.
Sec. 3231. Nutrition education and training.

                  Chapter 3--Miscellaneous Provisions

Sec. 3241. Coordination of school lunch, school breakfast, and summer 
              food service programs.

                     Subtitle C--Related Provisions

Sec. 3301. Requirement that data relating to the incidence of poverty 
              in the United States be published at least every 2 years.
Sec. 3302. Sense of the Congress.
Sec. 3303. Legislative accountability.
                         Subtitle A--Child Care

     SEC. 3101. SHORT TITLE AND REFERENCES.

       (a) Short Title.--This subtitle may be cited as the ``Child 
     Care and Development Block Grant Amendments of 1996''.
       (b) References.--Except as otherwise expressly provided, 
     whenever in this subtitle an amendment or repeal is expressed 
     in terms of an amendment to, or repeal of, a section or other 
     provision, the reference shall be considered to be made to a 
     section or other provision of the Child Care and Development 
     Block Grant Act of 1990 (42 U.S.C. 9858 et seq.).

     SEC. 3102. GOALS.

       Section 658A (42 U.S.C. 9801 note) is amended--
       (1) in the section heading by inserting ``and goals'' after 
     ``title'';
       (2) by inserting ``(a) Short Title.--'' before ``This''; 
     and
       (3) by adding at the end the following:
       ``(b) Goals.--The goals of this subchapter are--
       ``(1) to allow each State maximum flexibility in developing 
     child care programs and policies that best suit the needs of 
     children and parents within such State;
       ``(2) to promote parental choice to empower working parents 
     to make their own decisions on the child care that best suits 
     their family's needs;
       ``(3) to encourage States to provide consumer education 
     information to help parents make informed choices about child 
     care;
       ``(4) to assist States to provide child care to parents 
     trying to achieve independence from public assistance; and
       ``(5) to assist States in implementing the health, safety, 
     licensing, and registration standards established in State 
     regulations.''.

     SEC. 3103. AUTHORIZATION OF APPROPRIATIONS AND ENTITLEMENT 
                   AUTHORITY.

       (a) In General.--Section 658B (42 U.S.C. 9858) is amended 
     to read as follows:

     ``SEC. 658B. AUTHORIZATION OF APPROPRIATIONS.

       ``There is authorized to be appropriated to carry out this 
     subchapter $1,000,000,000 for each of the fiscal years 1996 
     through 2002.''.
       (b) Social Security Act.--Part A of title IV of the Social 
     Security Act (42 U.S.C. 601-617) is amended by adding at the 
     end the following new section:

     ``SEC. 418. FUNDING FOR CHILD CARE.

       ``(a) General Child Care Entitlement.--
       ``(1) General entitlement.--Subject to the amount 
     appropriated under paragraph (3), each State shall, for the 
     purpose of providing child care assistance, be entitled to 
     payments under a grant under this subsection for a fiscal 
     year in an amount equal to--
       ``(A) the sum of the total amount required to be paid to 
     the State under section 403 for fiscal year 1994 or 1995 
     (whichever is greater) with respect to amounts expended for 
     child care under section--
       ``(i) 402(g) of this Act (as such section was in effect 
     before October 1, 1995); and
       ``(ii) 402(i) of this Act (as so in effect); or
       ``(B) the average of the total amounts required to be paid 
     to the State for fiscal years 1992 through 1994 under the 
     sections referred to in subparagraph (A);

     whichever is greater.
       ``(2) Remainder.--
       ``(A) Grants.--The Secretary shall use any amounts 
     appropriated for a fiscal year under paragraph (3), and 
     remaining after the reservation described in paragraph (4) 
     and after grants are awarded under paragraph (1), to make 
     grants to States under this paragraph.
       ``(B) Amount.--Subject to subparagraph (C), the amount of a 
     grant awarded to a State for a fiscal year under this 
     paragraph shall be based on the formula used for determining 
     the amount of Federal payments to the State under section 
     403(n) (as such section was in effect before October 1, 
     1995).
       ``(C) Matching requirement.--The Secretary shall pay to 
     each eligible State in a fiscal year an amount, under a grant 
     under subparagraph (A), equal to the Federal medical 
     assistance percentage for such State for fiscal year 1995 (as 
     defined in section 1905(b)) of so much of the expenditures by 
     the State for child care in such year as exceed the State 
     set-aside for such State under paragraph (1)(A) for such year 
     and the amount of State expenditures in fiscal year 1994 or 
     1995 (whichever is greater) that equal the non-Federal share 
     for the programs described in subparagraph (A) of paragraph 
     (1).
       ``(D) Redistribution.--
       ``(i) In general.--With respect to any fiscal year, if the 
     Secretary determines (in accordance with clause (ii)) that 
     amounts under any grant awarded to a State under this 
     paragraph for such fiscal year will not be used by such State 
     during such fiscal year for carrying out the purpose for 
     which the grant is made, the Secretary shall make such 
     amounts available in the subsequent fiscal year for 
     carrying out such purpose to 1 or more States which apply 
     for such funds to the extent the Secretary determines that 
     such States will be able to use such additional amounts 
     for carrying out such purpose. Such available amounts 
     shall be redistributed to a State pursuant to section 
     402(i) (as such section was in effect before October 1, 
     1995) by substituting `the number of children residing in 
     all States applying for such funds' for `the number of 
     children residing in the United States in the second 
     preceding fiscal year'.
       ``(ii) Time of determination and distribution.--The 
     determination of the Secretary under clause (i) for a fiscal 
     year shall be made not later than the end of the first 
     quarter of the subsequent fiscal year. The redistribution of 
     amounts under clause (i) shall be made as close as 
     practicable to the date on which such determination is made. 
     Any amount made available to a State from an appropriation 
     for a fiscal year in accordance with this subparagraph shall, 
     for purposes of this part, be regarded as part of such 
     State's payment (as determined under this subsection) for the 
     fiscal year in which the redistribution is made.
       ``(3) Appropriation.--For grants under this section, there 
     are appropriated--
       ``(A) $1,967,000,000 for fiscal year 1997;
       ``(B) $2,067,000,000 for fiscal year 1998;
       ``(C) $2,167,000,000 for fiscal year 1999;
       ``(D) $2,367,000,000 for fiscal year 2000;
       ``(E) $2,567,000,000 for fiscal year 2001; and
       ``(F) $2,717,000,000 for fiscal year 2002.

[[Page H7835]]

       ``(4) Indian tribes.--The Secretary shall reserve not more 
     than 1 percent of the aggregate amount appropriated to carry 
     out this section in each fiscal year for payments to Indian 
     tribes and tribal organizations.
       ``(b) Use of Funds.--
       ``(1) In general.--Amounts received by a State under this 
     section shall only be used to provide child care assistance. 
     Amounts received by a State under a grant under subsection 
     (a)(1) shall be available for use by the State without fiscal 
     year limitation.
       ``(2) Use for certain populations.--A State shall ensure 
     that not less than 70 percent of the total amount of funds 
     received by the State in a fiscal year under this section are 
     used to provide child care assistance to families who are 
     receiving assistance under a State program under this part, 
     families who are attempting through work activities to 
     transition off of such assistance program, and families who 
     are at risk of becoming dependent on such assistance program.
       ``(c) Application of Child Care and Development Block Grant 
     Act of 1990.--Notwithstanding any other provision of law, 
     amounts provided to a State under this section shall be 
     transferred to the lead agency under the Child Care and 
     Development Block Grant Act of 1990, integrated by the State 
     into the programs established by the State under such Act, 
     and be subject to requirements and limitations of such Act.
       ``(d) Definition.--As used in this section, the term 
     `State' means each of the 50 States or the District of 
     Columbia.''.

     SEC. 3104. LEAD AGENCY.

       Section 658D(b) (42 U.S.C. 9858b(b)) is amended--
       (1) in paragraph (1)--
       (A) in subparagraph (A), by striking ``State'' the first 
     place that such appears and inserting ``governmental or 
     nongovernmental''; and
       (B) in subparagraph (C), by inserting ``with sufficient 
     time and Statewide distribution of the notice of such 
     hearing,'' after ``hearing in the State''; and
       (2) in paragraph (2), by striking the second sentence.

     SEC. 3105. APPLICATION AND PLAN.

       Section 658E (42 U.S.C. 9858c) is amended--
       (1) in subsection (b)--
       (A) by striking ``implemented--'' and all that follows 
     through ``(2)'' and inserting ``implemented''; and
       (B) by striking ``for subsequent State plans'';
       (2) in subsection (c)--
       (A) in paragraph (2)--
       (i) in subparagraph (A)--

       (I) in clause (i) by striking ``, other than through 
     assistance provided under paragraph (3)(C),''; and
       (II) by striking ``except'' and all that follows through 
     ``1992'', and inserting ``and provide a detailed description 
     of the procedures the State will implement to carry out the 
     requirements of this subparagraph'';

       (ii) in subparagraph (B)--

       (I) by striking ``Provide assurances'' and inserting 
     ``Certify''; and
       (II) by inserting before the period at the end ``and 
     provide a detailed description of such procedures'';

       (iii) in subparagraph (C)--

       (I) by striking ``Provide assurances'' and inserting 
     ``Certify''; and
       (II) by inserting before the period at the end ``and 
     provide a detailed description of how such record is 
     maintained and is made available'';

       (iv) by amending subparagraph (D) to read as follows:
       ``(D) Consumer education information.--Certify that the 
     State will collect and disseminate to parents of eligible 
     children and the general public, consumer education 
     information that will promote informed child care choices.'';
       (v) in subparagraph (E), to read as follows:
       ``(E) Compliance with state licensing requirements.--
       ``(i) In general.--Certify that the State has in effect 
     licensing requirements applicable to child care services 
     provided within the State, and provide a detailed description 
     of such requirements and of how such requirements are 
     effectively enforced. Nothing in the preceding sentence shall 
     be construed to require that licensing requirements be 
     applied to specific types of providers of child care 
     services.
       ``(ii) Indian tribes and tribal organizations.--In lieu of 
     any licensing and regulatory requirements applicable under 
     State and local law, the Secretary, in consultation with 
     Indian tribes and tribal organizations, shall develop minimum 
     child care standards (that appropriately reflect tribal needs 
     and available resources) that shall be applicable to Indian 
     tribes and tribal organization receiving assistance under 
     this subchapter.'';
       (vi) in subparagraph (G) by striking ``Provide assurances'' 
     and inserting ``Certify''; and
       (vii) by striking subparagraphs (H), (I), and (J) and 
     inserting the following:
       ``(H) Meeting the needs of certain populations.--
     Demonstrate the manner in which the State will meet the 
     specific child care needs of families who are receiving 
     assistance under a State program under part A of title IV of 
     the Social Security Act, families who are attempting through 
     work activities to transition off of such assistance program, 
     and families that are at risk of becoming dependent on such 
     assistance program.'';
       (B) in paragraph (3)--
       (i) in subparagraph (A), by striking ``(B) and (C)'' and 
     inserting ``(B) through (D)'';
       (ii) in subparagraph (B)--

       (I) by striking ``.--Subject to the reservation contained 
     in subparagraph (C), the'' and inserting ``and related 
     activities.--The'';
       (II) in clause (i) by striking ``; and'' at the end and 
     inserting a period;
       (III) by striking ``for--'' and all that follows through 
     ``section 658E(c)(2)(A)'' and inserting ``for child care 
     services on sliding fee scale basis, activities that improve 
     the quality or availability of such services, and any other 
     activity that the State deems appropriate to realize any of 
     the goals specified in paragraphs (2) through (5) of section 
     658A(b)''; and
       (IV) by striking clause (ii);

       (iii) by amending subparagraph (C) to read as follows:
       ``(C) Limitation on administrative costs.--Not more than 5 
     percent of the aggregate amount of funds available to the 
     State to carry out this subchapter by a State in each fiscal 
     year may be expended for administrative costs incurred by 
     such State to carry out all of its functions and duties under 
     this subchapter. As used in the preceding sentence, the term 
     `administrative costs' shall not include the costs of 
     providing direct services.''; and
       (iv) by adding at the end thereof the following:
       ``(D) Assistance for certain families.--A State shall 
     ensure that a substantial portion of the amounts available 
     (after the State has complied with the requirement of section 
     418(b)(2) of the Social Security Act with respect to each of 
     the fiscal years 1997 through 2002) to the State to carry out 
     activities under this subchapter in each fiscal year is used 
     to provide assistance to low-income working families other 
     than families described in paragraph (2)(H).''; and
       (C) in paragraph (4)(A)--
       (i) by striking ``provide assurances'' and inserting 
     ``certify'';
       (ii) in the first sentence by inserting ``and shall provide 
     a summary of the facts relied on by the State to determine 
     that such rates are sufficient to ensure such access'' before 
     the period; and
       (iii) by striking the last sentence.

     SEC. 3106. LIMITATION ON STATE ALLOTMENTS.

       Section 658F(b)(1) (42 U.S.C. 9858d(b)(1)) is amended by 
     striking ``No'' and inserting ``Except as provided for in 
     section 658O(c)(6), no''.

     SEC. 3107. ACTIVITIES TO IMPROVE THE QUALITY OF CHILD CARE.

       Section 658G (42 U.S.C. 9858e) is amended to read as 
     follows:

     ``SEC. 658G. ACTIVITIES TO IMPROVE THE QUALITY OF CHILD CARE.

       ``A State that receives funds to carry out this subchapter 
     for a fiscal year, shall use not less than 4 percent of the 
     amount of such funds for activities that are designed to 
     provide comprehensive consumer education to parents and the 
     public, activities that increase parental choice, and 
     activities designed to improve the quality and availability 
     of child care (such as resource and referral services).''.

     SEC. 3108. REPEAL OF EARLY CHILDHOOD DEVELOPMENT AND BEFORE- 
                   AND AFTER-SCHOOL CARE REQUIREMENT.

       Section 658H (42 U.S.C. 9858f) is repealed.

     SEC. 3109. ADMINISTRATION AND ENFORCEMENT.

       Section 658I(b) (42 U.S.C. 9858g(b)) is amended--
       (1) in paragraph (1), by striking ``, and shall have'' and 
     all that follows through ``(2)''; and
       (2) in the matter following clause (ii) of paragraph 
     (2)(A), by striking ``finding and that'' and all that follows 
     through the period and inserting ``finding and shall require 
     that the State reimburse the Secretary for any funds that 
     were improperly expended for purposes prohibited or not 
     authorized by this subchapter, that the Secretary deduct from 
     the administrative portion of the State allotment for the 
     following fiscal year an amount that is less than or equal to 
     any improperly expended funds, or a combination of such 
     options.''.

     SEC. 3110. PAYMENTS.

       Section 658J(c) (42 U.S.C. 9858h(c)) is amended by striking 
     ``expended'' and inserting ``obligated''.

     SEC. 3111. ANNUAL REPORT AND AUDITS.

       Section 658K (42 U.S.C. 9858i) is amended--
       (1) in the section heading by striking ``annual report'' 
     and inserting ``reports'';
       (2) in subsection (a), to read as follows:
       ``(a) Reports.--
       ``(1) Collection of information by states.--
       ``(A) In general.--A State that receives funds to carry out 
     this subchapter shall collect the information described in 
     subparagraph (B) on a monthly basis.
       ``(B) Required information.--The information required under 
     this subparagraph shall include, with respect to a family 
     unit receiving assistance under this subchapter information 
     concerning--
       ``(i) family income;
       ``(ii) county of residence;
       ``(iii) the gender, race, and age of children receiving 
     such assistance;
       ``(iv) whether the family includes only 1 parent;
       ``(v) the sources of family income, including the amount 
     obtained from (and separately identified)--

       ``(I) employment, including self-employment;
       ``(II) cash or other assistance under part A of title IV of 
     the Social Security Act;

[[Page H7836]]

       ``(III) housing assistance;
       ``(IV) assistance under the Food Stamp Act of 1977; and
       ``(V) other assistance programs;

       ``(vi) the number of months the family has received 
     benefits;
       ``(vii) the type of child care in which the child was 
     enrolled (such as family child care, home care, or center-
     based child care);
       ``(viii) whether the child care provider involved was a 
     relative;
       ``(ix) the cost of child care for such families; and
       ``(x) the average hours per week of such care;

     during the period for which such information is required to 
     be submitted.
       ``(C) Submission to secretary.--A State described in 
     subparagraph (A) shall, on a quarterly basis, submit the 
     information required to be collected under subparagraph (B) 
     to the Secretary.
       ``(D) Sampling.--The Secretary may disapprove the 
     information collected by a State under this paragraph if the 
     State uses sampling methods to collect such information.
       ``(2) Biannual reports.--Not later than December 31, 1997, 
     and every 6 months thereafter, a State described in paragraph 
     (1)(A) shall prepare and submit to the Secretary a report 
     that includes aggregate data concerning--
       ``(A) the number of child care providers that received 
     funding under this subchapter as separately identified based 
     on the types of providers listed in section 658P(5);
       ``(B) the monthly cost of child care services, and the 
     portion of such cost that is paid for with assistance 
     provided under this subchapter, listed by the type of child 
     care services provided;
       ``(C) the number of payments made by the State through 
     vouchers, contracts, cash, and disregards under public 
     benefit programs, listed by the type of child care services 
     provided;
       ``(D) the manner in which consumer education information 
     was provided to parents and the number of parents to whom 
     such information was provided; and
       ``(E) the total number (without duplication) of children 
     and families served under this subchapter;

     during the period for which such report is required to be 
     submitted.''; and
       (2) in subsection (b)--
       (A) in paragraph (1) by striking ``a application'' and 
     inserting ``an application'';
       (B) in paragraph (2) by striking ``any agency administering 
     activities that receive'' and inserting ``the State that 
     receives''; and
       (C) in paragraph (4) by striking ``entitles'' and inserting 
     ``entitled''.

     SEC. 3112. REPORT BY THE SECRETARY.

       Section 658L (42 U.S.C. 9858j) is amended--
       (1) by striking ``1993'' and inserting ``1997'';
       (2) by striking ``annually'' and inserting ``biennially''; 
     and
       (3) by striking ``Education and Labor'' and inserting 
     ``Economic and Educational Opportunities''.

     SEC. 3113. ALLOTMENTS.

       Section 658O (42 U.S.C. 9858m) is amended--
       (1) in subsection (a)--
       (A) in paragraph (1)
       (i) by striking ``Possessions'' and inserting 
     ``possessions'';
       (ii) by inserting ``and'' after ``States,''; and
       (iii) by striking ``, and the Trust Territory of the 
     Pacific Islands''; and
       (B) in paragraph (2), by striking ``3 percent'' and 
     inserting ``1 percent'';
       (2) in subsection (c)--
       (A) in paragraph (5) by striking ``our'' and inserting 
     ``out''; and
       (B) by adding at the end thereof the following new 
     paragraph:
       ``(6) Construction or renovation of facilities.--
       ``(A) Request for use of funds.--An Indian tribe or tribal 
     organization may submit to the Secretary a request to use 
     amounts provided under this subsection for construction or 
     renovation purposes.
       ``(B) Determination.--With respect to a request submitted 
     under subparagraph (A), and except as provided in 
     subparagraph (C), upon a determination by the Secretary that 
     adequate facilities are not otherwise available to an Indian 
     tribe or tribal organization to enable such tribe or 
     organization to carry out child care programs in accordance 
     with this subchapter, and that the lack of such facilities 
     will inhibit the operation of such programs in the future, 
     the Secretary may permit the tribe or organization to use 
     assistance provided under this subsection to make payments 
     for the construction or renovation of facilities that will be 
     used to carry out such programs.
       ``(C) Limitation.--The Secretary may not permit an Indian 
     tribe or tribal organization to use amounts provided under 
     this subsection for construction or renovation if such use 
     will result in a decrease in the level of child care services 
     provided by the tribe or organization as compared to the 
     level of such services provided by the tribe or organization 
     in the fiscal year preceding the year for which the 
     determination under subparagraph (A) is being made.
       ``(D) Uniform procedures.--The Secretary shall develop and 
     implement uniform procedures for the solicitation and 
     consideration of requests under this paragraph.''; and
       (3) in subsection (e), by adding at the end thereof the 
     following new paragraph:
       ``(4) Indian tribes or tribal organizations.--Any portion 
     of a grant or contract made to an Indian tribe or tribal 
     organization under subsection (c) that the Secretary 
     determines is not being used in a manner consistent with the 
     provision of this subchapter in the period for which the 
     grant or contract is made available, shall be allotted by the 
     Secretary to other tribes or organizations that have 
     submitted applications under subsection (c) in accordance 
     with their respective needs.''.

     SEC. 3114. DEFINITIONS.

       Section 658P (42 U.S.C. 9858n) is amended--
       (1) in paragraph (2), in the first sentence by inserting 
     ``or as a deposit for child care services if such a deposit 
     is required of other children being cared for by the 
     provider'' after ``child care services''; and
       (2) by striking paragraph (3);
       (3) in paragraph (4)(B), by striking ``75 percent'' and 
     inserting ``85 percent'';
       (4) in paragraph (5)(B)--
       (A) by inserting ``great grandchild, sibling (if such 
     provider lives in a separate residence),'' after 
     ``grandchild,'';
       (B) by striking ``is registered and''; and
       (C) by striking ``State'' and inserting ``applicable''.
       (5) by striking paragraph (10);
       (6) in paragraph (13)--
       (A) by inserting ``or'' after ``Samoa,''; and
       (B) by striking ``, and the Trust Territory of the Pacific 
     Islands'';
       (7) in paragraph (14)--
       (A) by striking ``The term'' and inserting the following:
       ``(A) In general.--The term''; and
       (B) by adding at the end thereof the following new 
     subparagraph:
       ``(B) Other organizations.--Such term includes a Native 
     Hawaiian Organization, as defined in section 4009(4) of the 
     Augustus F. Hawkins-Robert T. Stafford Elementary and 
     Secondary School Improvement Amendments of 1988 (20 U.S.C. 
     4909(4)) and a private nonprofit organization established for 
     the purpose of serving youth who are Indians or Native 
     Hawaiians.''.

     SEC. 3115. REPEALS.

       (a) Child Development Associate Scholarship Assistance Act 
     of 1985.--Title VI of the Human Services Reauthorization Act 
     of 1986 (42 U.S.C. 10901-10905) is repealed.
       (b) State Dependent Care Development Grants Act.--
     Subchapter E of chapter 8 of subtitle A of title VI of the 
     Omnibus Budget Reconciliation Act of 1981 (42 U.S.C. 9871-
     9877) is repealed.
       (c) Programs of National Significance.--Title X of the 
     Elementary and Secondary Education Act of 1965, as amended by 
     Public Law 103-382 (108 Stat. 3809 et seq.), is amended--
       (1) in section 10413(a) by striking paragraph (4),
       (2) in section 10963(b)(2) by striking subparagraph (G), 
     and
       (3) in section 10974(a)(6) by striking subparagraph (G).
       (d) Native Hawaiian Family-Based Education Centers.--
     Section 9205 of the Native Hawaiian Education Act (Public Law 
     103-382; 108 Stat. 3794) is repealed.
       (e) Certain Child Care Programs Under the Social Security 
     Act.--
       (1) AFDC and transitional child care programs.--Section 402 
     of the Social Security Act (42 U.S.C. 602) is amended by 
     striking subsection (g).
       (2) At-risk child care program.--
       (A) Authorization.--Section 402 of the Social Security Act 
     (42 U.S.C. 602) is amended by striking subsection (i).
       (B) Funding provisions.--Section 403 of the Social Security 
     Act (42 U.S.C. 603) is amended by striking subsection (n).

     SEC. 3116. EFFECTIVE DATE.

       (a) In General.--Except as provided in subsection (b), this 
     subtitle and the amendments made by this subtitle shall take 
     effect on October 1, 1996.
       (b) Exception.--The amendment made by section 3303(a) shall 
     take effect on the date of enactment of this Act.
                  Subtitle B--Child Nutrition Programs

                  CHAPTER 1--NATIONAL SCHOOL LUNCH ACT

     SEC. 3201. STATE DISBURSEMENT TO SCHOOLS.

       (a) In General.--Section 8 of the National School Lunch Act 
     (42 U.S.C. 1757) is amended--
       (1) in the third sentence, by striking ``Nothing'' and all 
     that follows through ``educational agency to'' and inserting 
     ``The State educational agency may'';
       (2) by striking the fourth and fifth sentences;
       (3) by redesignating the first through sixth sentences, as 
     amended by paragraph (1), as subsections (a) through (f), 
     respectively;
       (4) in subsection (b), as redesignated by paragraph (3), by 
     striking ``the preceding sentence'' and inserting 
     ``subsection (a)''; and
       (5) in subsection (d), as redesignated by paragraph (3), by 
     striking ``Such food costs'' and inserting ``Use of funds 
     paid to States''.
       (b) Definition of Child.--Section 12(d) of the Act (42 
     U.S.C. 1760(d)) is amended by adding at the end the 
     following:
       ``(9) `child' includes an individual, regardless of age, 
     who--
       ``(A) is determined by a State educational agency, in 
     accordance with regulations prescribed by the Secretary, to 
     have 1 or more mental or physical disabilities; and
       ``(B) is attending any institution, as defined in section 
     17(a), or any nonresidential public or nonprofit private 
     school of high school grade or under, for the purpose of 
     participating in a school program established for individuals 
     with mental or physical disabilities.


[[Page H7837]]


     No institution that is not otherwise eligible to participate 
     in the program under section 17 shall be considered eligible 
     because of this paragraph.''.

     SEC. 3202. NUTRITIONAL AND OTHER PROGRAM REQUIREMENTS.

       (a) Nutritional Standards.--Section 9(a) of the National 
     School Lunch Act (42 U.S.C. 1758(a)) is amended--
       (1) in paragraph (2)--
       (A) by striking ``(2)(A) Lunches'' and inserting ``(2) 
     Lunches'';
       (B) by striking subparagraph (B); and
       (C) by redesignating clauses (i) and (ii) as subparagraphs 
     (A) and (B), respectively;
       (2) by striking paragraph (3); and
       (3) by redesignating paragraph (4) as paragraph (3).
       (b) Eligibility Guidelines.--Section 9(b) of the Act is 
     amended--
       (1) in paragraph (2)--
       (A) by striking subparagraph (A); and
       (B) by redesignating subparagraphs (B) and (C) as 
     subparagraphs (A) and (B), respectively;
       (2) in paragraph (5), by striking the third sentence; and
       (3) in paragraph (6), by striking ``paragraph (2)(C)'' and 
     inserting ``paragraph (2)(B)''.
       (c) Utilization of Agricultural Commodities.--Section 9(c) 
     of the Act is amended by striking the second, fourth, and 
     sixth sentences.
       (d) Conforming Amendment.--The last sentence of section 
     9(d)(1) of the Act is amended by striking ``subsection 
     (b)(2)(C)'' and inserting ``subsection (b)(2)(B)''.
       (e) Nutritional Information.--Section 9(f) of the Act is 
     amended--
       (1) by striking paragraph (1);
       (2) by striking ``(2)'';
       (3) by redesignating subparagraphs (A) through (D) as 
     paragraphs (1) through (4), respectively;
       (4) by striking paragraph (1), as redesignated by paragraph 
     (3), and inserting the following:
       ``(1) Nutritional requirements.--Except as provided in 
     paragraph (2), not later than the first day of the 1996-1997 
     school year, schools that are participating in the school 
     lunch or school breakfast program shall serve lunches and 
     breakfasts under the program that--
       ``(A) are consistent with the goals of the most recent 
     Dietary Guidelines for Americans published under section 301 
     of the National Nutrition Monitoring and Related Research Act 
     of 1990 (7 U.S.C. 5341); and
       ``(B) provide, on the average over each week, at least--
       ``(i) with respect to school lunches, \1/3\ of the daily 
     recommended dietary allowance established by the Food and 
     Nutrition Board of the National Research Council of the 
     National Academy of Sciences; and
       ``(ii) with respect to school breakfasts, \1/4\ of the 
     daily recommended dietary allowance established by the Food 
     and Nutrition Board of the National Research Council of the 
     National Academy of Sciences.'';
       (5) in paragraph (3), as redesignated by paragraph (3)--
       (A) by redesignating clauses (i) and (ii) as subparagraphs 
     (A) and (B), respectively; and
       (B) in subparagraph (A), as so redesignated, by 
     redesignating subclauses (I) and (II) as clauses (i) and 
     (ii), respectively; and
       (6) in paragraph (4), as redesignated by paragraph (3)--
       (A) by redesignating clauses (i) and (ii) as subparagraphs 
     (A) and (B), respectively;
       (B) in subparagraph (A) (as redesignated by subparagraph 
     (A)), by redesignating subclauses (I) and (II) as clauses (i) 
     and (ii), respectively; and
       (C) in subparagraph (A)(ii) (as redesignated by 
     subparagraph (B)), by striking ``subparagraph (C)'' and 
     inserting ``paragraph (3)''.
       (f) Use of Resources.--Section 9 of the Act is amended by 
     striking subsection (h).

     SEC. 3203. FREE AND REDUCED PRICE POLICY STATEMENT.

       Section 9(b)(2) of the National School Lunch Act (42 U.S.C. 
     1758(b)(2)), as amended by section 3202(b)(1), is further 
     amended by adding at the end the following:
       ``(C) Free and reduced price policy statement.--After the 
     initial submission, a school shall not be required to submit 
     a free and reduced price policy statement to a State 
     educational agency under this Act unless there is a 
     substantive change in the free and reduced price policy of 
     the school. A routine change in the policy of a school, such 
     as an annual adjustment of the income eligibility guidelines 
     for free and reduced price meals, shall not be sufficient 
     cause for requiring the school to submit a policy 
     statement.''.

     SEC. 3204. SPECIAL ASSISTANCE.

       (a) Extension of Payment Period.--Section 11(a)(1)(D)(i) of 
     the National School Lunch Act (42 U.S.C. 1759a(a)(1)(D)(i)) 
     is amended by striking ``, on the date of enactment of this 
     subparagraph,''.
       (b) Applicability of Other Provisions.--Section 11 of the 
     Act is amended--
       (1) by striking subsection (d);
       (2) in subsection (e)(2)--
       (A) by striking ``The'' and inserting ``On request of the 
     Secretary, the''; and
       (B) by striking ``each month''; and
       (3) by redesignating subsections (e) and (f), as so 
     amended, as subsections (d) and (e), respectively.

     SEC. 3205. MISCELLANEOUS PROVISIONS AND DEFINITIONS.

       (a) Accounts and Records.--Section 12(a) of the National 
     School Lunch Act (42 U.S.C. 1760(a)) is amended by striking 
     ``at all times be available'' and inserting ``be available at 
     any reasonable time''.
       (b) Restriction on Requirements.--Section 12(c) of the Act 
     is amended by striking ``neither the Secretary nor the State 
     shall'' and inserting ``the Secretary shall not''.
       (c) Definitions.--Section 12(d) of the Act, as amended by 
     section 3201(b), is further amended--
       (1) in paragraph (1), by striking ``the Trust Territory of 
     the Pacific Islands'' and inserting ``the Commonwealth of the 
     Northern Mariana Islands'';
       (2) by striking paragraphs (3) and (4); and
       (3) by redesignating paragraphs (1), (2), and (5) through 
     (9) as paragraphs (6), (7), (3), (4), (2), (5), and (1), 
     respectively, and rearranging the paragraphs so as to appear 
     in numerical order.
       (d) Adjustments to National Average Payment Rates.--Section 
     12(f) of the Act is amended by striking ``the Trust Territory 
     of the Pacific Islands,''.
       (e) Expedited Rulemaking.--Section 12(k) of the Act is 
     amended--
       (1) by striking paragraphs (1), (2), and (5); and
       (2) by redesignating paragraphs (3) and (4) as paragraphs 
     (1) and (2), respectively.
       (f) Waiver.--Section 12(l) of the Act is amended--
       (1) in paragraph (2)(A)--
       (A) in clause (iii), by adding ``and'' at the end;
       (B) in clause (iv), by striking the semicolon at the end 
     and inserting a period; and
       (C) by striking clauses (v) through (vii);
       (2) in paragraph (3)--
       (A) by striking ``(A)''; and
       (B) by striking subparagraphs (B) through (D);
       (3) in paragraph (4)--
       (A) in the matter preceding subparagraph (A), by striking 
     ``of any requirement relating'' and inserting ``that 
     increases Federal costs or that relates'';
       (B) by striking subparagraph (D);
       (C) by redesignating subparagraphs (E) through (N) as 
     subparagraphs (D) through (M), respectively; and
       (D) in subparagraph (L), as redesignated by subparagraph 
     (C), by striking ``and'' at the end and inserting ``or''; and
       (4) in paragraph (6)--
       (A) by striking ``(A)(i)'' and all that follows through 
     ``(B)''; and
       (B) by redesignating clauses (i) through (iv) as 
     subparagraphs (A) through (D), respectively.
       (g) Food and Nutrition Projects.--Section 12 of the Act is 
     amended by striking subsection (m).

     SEC. 3206. SUMMER FOOD SERVICE PROGRAM FOR CHILDREN.

       (a) Establishment of Program.--Section 13(a) of the 
     National School Lunch Act (42 U.S.C. 1761(a)) is amended--
       (1) in paragraph (1)--
       (A) in the first sentence, by striking ``initiate, 
     maintain, and expand'' and inserting ``initiate and 
     maintain''; and
       (B) in subparagraph (E) of the second sentence, by striking 
     ``the Trust Territory of the Pacific Islands,''; and
       (2) in paragraph (7)(A), by striking ``Except as provided 
     in subparagraph (C), private'' and inserting ``Private''.
       (b) Service Institutions.--Section 13(b) of the Act is 
     amended by striking ``(b)(1)'' and all that follows through 
     the end of paragraph (1) and inserting the following:
       ``(b) Service Institutions.--
       ``(1) Payments.--
       ``(A) In general.--Except as otherwise provided in this 
     paragraph, payments to service institutions shall equal the 
     full cost of food service operations (which cost shall 
     include the costs of obtaining, preparing, and serving food, 
     but shall not include administrative costs).
       ``(B) Maximum amounts.--Subject to subparagraph (C), 
     payments to any institution under subparagraph (A) shall not 
     exceed--
       ``(i) $1.82 for each lunch and supper served;
       ``(ii) $1.13 for each breakfast served; and
       ``(iii) 46 cents for each meal supplement served.
       ``(C) Adjustments.--Amounts specified in subparagraph (B) 
     shall be adjusted on January 1, 1997, and each January 1 
     thereafter, to the nearest lower cent increment in accordance 
     with the changes for the 12-month period ending the preceding 
     November 30 in the series for food away from home of the 
     Consumer Price Index for All Urban Consumers published by the 
     Bureau of Labor Statistics of the Department of Labor. Each 
     adjustment shall be based on the unrounded adjustment for the 
     prior 12-month period.''.
       (c) Administration of Service Institutions.--Section 
     13(b)(2) of the Act is amended--
       (1) in the first sentence, by striking ``four meals'' and 
     inserting ``3 meals, or 2 meals and 1 supplement,''; and
       (2) by striking the second sentence.
       (d) Reimbursements.--Section 13(c)(2) of the Act is 
     amended--
       (1) by striking subparagraph (A);
       (2) in subparagraph (B)--
       (A) in the first sentence--
       (i) by striking ``, and such higher education 
     institutions,''; and
       (ii) by striking ``without application'' and inserting 
     ``upon showing residence in areas in which poor economic 
     conditions exist or on the basis of income eligibility 
     statements for children enrolled in the program''; and
       (B) by adding at the end the following: ``The higher 
     education institutions referred

[[Page H7838]]

     to in the preceding sentence shall be eligible to participate 
     in the program under this paragraph without application.'';
       (3) in subparagraph (C)(ii), by striking ``severe need''; 
     and
       (4) by redesignating subparagraphs (B) through (E), as so 
     amended, as subparagraphs (A) through (D), respectively.
       (e) Advance Program Payments.--Section 13(e)(1) of the Act 
     is amended--
       (1) by striking ``institution: Provided, That (A) the'' and 
     inserting ``institution. The'';
       (2) by inserting ``(excluding a school)'' after ``any 
     service institution''; and
       (3) by striking ``responsibilities, and (B) no'' and 
     inserting ``responsibilities. No''.
       (f) Food Requirements.--Section 13(f) of the Act is 
     amended--
       (1) by redesignating the first through seventh sentences as 
     paragraphs (1) through (7), respectively;
       (2) by striking paragraph (3), as redesignated by paragraph 
     (1);
       (3) in paragraph (4), as redesignated by paragraph (1), by 
     striking ``the first sentence'' and inserting ``paragraph 
     (1)'';
       (4) in paragraph (6), as redesignated by paragraph (1), by 
     striking ``that bacteria levels'' and all that follows 
     through the period at the end and inserting ``conformance 
     with standards set by local health authorities.''; and
       (5) by redesignating paragraphs (4) through (7), as 
     redesignated by paragraph (1), as paragraphs (3) through (6), 
     respectively.
       (g) Permitting Offer Versus Serve.--Section 13(f) of the 
     Act, as amended by subsection (f), is further amended by 
     adding at the end the following:
       ``(7) Offer versus serve.--A school food authority 
     participating as a service institution may permit a child 
     attending a site on school premises operated directly by the 
     authority to refuse not more than 1 item of a meal that the 
     child does not intend to consume. A refusal of an offered 
     food item shall not affect the amount of payments made under 
     this section to a school for the meal.''.
       (h) Food Service Management Companies.--Section 13(l) of 
     the Act is amended--
       (1) by striking paragraph (4);
       (2) in paragraph (5), by striking the first sentence; and
       (3) by redesignating paragraph (5), as so amended, as 
     paragraph (4).
       (i) Records.--The second sentence of section 13(m) of the 
     Act is amended by striking ``at all times be available'' and 
     inserting ``be available at any reasonable time''.
       (j) Removing Mandatory Notice to Institutions.--Section 
     13(n)(2) of the Act is amended by striking ``, and its plans 
     and schedule for informing service institutions of the 
     availability of the program''.
       (k) Plan.--Section 13(n) of the Act is amended--
       (1) in paragraph (2), by striking ``, including the State's 
     methods of assessing need'';
       (2) by striking paragraph (3);
       (3) in paragraph (4), by striking ``and schedule''; and
       (4) by redesignating paragraphs (4) through (7), as so 
     amended, as paragraphs (3) through (6), respectively.
       (l) Monitoring and Training.--Section 13(q) of the Act is 
     amended--
       (1) by striking paragraphs (2) and (4);
       (2) in paragraph (3), by striking ``paragraphs (1) and (2) 
     of this subsection'' and inserting ``paragraph (1)''; and
       (3) by redesignating paragraph (3), as so amended, as 
     paragraph (2).
       (m) Expired Program.--Section 13 of the Act is amended--
       (1) by striking subsection (p); and
       (2) by redesignating subsections (q) and (r), as so 
     amended, as subsections (p) and (q), respectively.
       (n) Effective Date.--The amendments made by subsection (b) 
     shall become effective on January 1, 1997.

     SEC. 3207. COMMODITY DISTRIBUTION.

       (a) Cereal and Shortening in Commodity Donations.--Section 
     14(b) of the National School Lunch Act (42 U.S.C. 1762a(b)) 
     is amended--
       (1) by striking paragraph (1); and
       (2) by redesignating paragraphs (2) and (3) as paragraphs 
     (1) and (2), respectively.
       (b) Impact Study and Purchasing Procedures.--Section 14(d) 
     of the Act is amended by striking the second and third 
     sentences.
       (c) Cash Compensation for Pilot Project Schools.--Section 
     14(g) of the Act is amended by striking paragraph (3).
       (d) State Advisory Council.--Section 14 is amended--
       (1) by striking subsection (e); and
       (2) by redesignating subsections (f) and (g), as so 
     amended, as subsections (e) and (f), respectively.

     SEC. 3208. CHILD CARE FOOD PROGRAM.

       (a) Establishment of Program.--Section 17 of the National 
     School Lunch Act (42 U.S.C. 1766) is amended--
       (1) in the section heading, by striking ``and adult''; and
       (2) in the first sentence of subsection (a), by striking 
     ``initiate, maintain, and expand'' and inserting ``initiate 
     and maintain''.
       (b) Payments to Sponsor Employees.--Paragraph (2) of the 
     last sentence of section 17(a) of the Act (42 U.S.C. 1766(a)) 
     is amended--
       (1) by striking ``and'' at the end of subparagraph (B);
       (2) by striking the period at the end of subparagraph (C) 
     and inserting ``; and''; and
       (3) by adding at the end the following:
       ``(D) in the case of a family or group day care home 
     sponsoring organization that employs more than 1 employee, 
     the organization does not base payments to an employee of the 
     organization on the number of family or group day care homes 
     recruited.''.
       (c) Technical Assistance.--The last sentence of section 
     17(d)(1) of the Act is amended by striking ``, and shall 
     provide technical assistance'' and all that follows through 
     ``its application''.
       (d) Reimbursement of Child Care Institutions.--Section 
     17(f)(2)(B) of the Act (42 U.S.C. 1766(f)(2)(B)) is amended 
     by striking ``two meals and two supplements or three meals 
     and one supplement'' and inserting ``two meals and one 
     supplement''.
       (e) Improved Targeting of Day Care Home Reimbursements.--
       (1) Restructured day care home reimbursements.--Section 
     17(f)(3) of the Act is amended by striking ``(3)(A) 
     Institutions'' and all that follows through the end of 
     subparagraph (A) and inserting the following:
       ``(3) Reimbursement of family or group day care home 
     sponsoring organizations.--
       ``(A) Reimbursement factor.--
       ``(i) In general.--An institution that participates in the 
     program under this section as a family or group day care home 
     sponsoring organization shall be provided, for payment to a 
     home sponsored by the organization, reimbursement factors in 
     accordance with this subparagraph for the cost of obtaining 
     and preparing food and prescribed labor costs involved in 
     providing meals under this section.
       ``(ii) Tier i family or group day care homes.--

       ``(I) Definition.--In this paragraph, the term `tier I 
     family or group day care home' means--

       ``(aa) a family or group day care home that is located in a 
     geographic area, as defined by the Secretary based on census 
     data, in which at least 50 percent of the children residing 
     in the area are members of households whose incomes meet the 
     income eligibility guidelines for free or reduced price meals 
     under section 9;
       ``(bb) a family or group day care home that is located in 
     an area served by a school enrolling elementary students in 
     which at least 50 percent of the total number of children 
     enrolled are certified eligible to receive free or reduced 
     price school meals under this Act or the Child Nutrition Act 
     of 1966 (42 U.S.C. 1771 et seq.); or
       ``(cc) a family or group day care home that is operated by 
     a provider whose household meets the income eligibility 
     guidelines for free or reduced price meals under section 9 
     and whose income is verified by the sponsoring organization 
     of the home under regulations established by the Secretary.

       ``(II) Reimbursement.--Except as provided in subclause 
     (III), a tier I family or group day care home shall be 
     provided reimbursement factors under this clause without a 
     requirement for documentation of the costs described in 
     clause (i), except that reimbursement shall not be provided 
     under this subclause for meals or supplements served to the 
     children of a person acting as a family or group day care 
     home provider unless the children meet the income eligibility 
     guidelines for free or reduced price meals under section 9.
       ``(III) Factors.--Except as provided in subclause (IV), the 
     reimbursement factors applied to a home referred to in 
     subclause (II) shall be the factors in effect on July 1, 
     1996.
       ``(IV) Adjustments.--The reimbursement factors under this 
     subparagraph shall be adjusted on July 1, 1997, and each July 
     1 thereafter, to reflect changes in the Consumer Price Index 
     for food at home for the most recent 12-month period for 
     which the data are available. The reimbursement factors under 
     this subparagraph shall be rounded to the nearest lower cent 
     increment and based on the unrounded adjustment in effect on 
     June 30 of the preceding school year.

       ``(iii) Tier ii family or group day care homes.--

       ``(I) In general.--

       ``(aa) Factors.--Except as provided in subclause (II), with 
     respect to meals or supplements served under this clause by a 
     family or group day care home that does not meet the criteria 
     set forth in clause (ii)(I), the reimbursement factors shall 
     be 90 cents for lunches and suppers, 25 cents for breakfasts, 
     and 10 cents for supplements.
       ``(bb) Adjustments.--The factors shall be adjusted on July 
     1, 1997, and each July 1 thereafter, to reflect changes in 
     the Consumer Price Index for food at home for the most recent 
     12-month period for which the data are available. The 
     reimbursement factors under this item shall be rounded down 
     to the nearest lower cent increment and based on the 
     unrounded adjustment for the preceding 12-month period.
       ``(cc) Reimbursement.--A family or group day care home 
     shall be provided reimbursement factors under this subclause 
     without a requirement for documentation of the costs 
     described in clause (i), except that reimbursement shall not 
     be provided under this subclause for meals or supplements 
     served to the children of a person acting as a family or 
     group day care home provider unless the children meet the 
     income eligibility guidelines for free or reduced price meals 
     under section 9.

       ``(II) Other factors.--A family or group day care home that 
     does not meet the criteria set forth in clause (ii)(I) may 
     elect to be provided reimbursement factors determined in 
     accordance with the following requirements:

       ``(aa) Children eligible for free or reduced price meals.--
     In the case of meals or

[[Page H7839]]

     supplements served under this subsection to children who are 
     members of households whose incomes meet the income 
     eligibility guidelines for free or reduced price meals under 
     section 9, the family or group day care home shall be 
     provided reimbursement factors set by the Secretary in 
     accordance with clause (ii)(III).
       ``(bb) Ineligible children.--In the case of meals or 
     supplements served under this subsection to children who are 
     members of households whose incomes do not meet the income 
     eligibility guidelines, the family or group day care home 
     shall be provided reimbursement factors in accordance with 
     subclause (I).

       ``(III) Information and determinations.--

       ``(aa) In general.--If a family or group day care home 
     elects to claim the factors described in subclause (II), the 
     family or group day care home sponsoring organization serving 
     the home shall collect the necessary income information, as 
     determined by the Secretary, from any parent or other 
     caretaker to make the determinations specified in subclause 
     (II) and shall make the determinations in accordance with 
     rules prescribed by the Secretary.
       ``(bb) Categorical eligibility.--In making a determination 
     under item (aa), a family or group day care home sponsoring 
     organization may consider a child participating in or 
     subsidized under, or a child with a parent participating in 
     or subsidized under, a federally or State supported child 
     care or other benefit program with an income eligibility 
     limit that does not exceed the eligibility standard for free 
     or reduced price meals under section 9 to be a child who is a 
     member of a household whose income meets the income 
     eligibility guidelines under section 9.
       ``(cc) Factors for children only.--A family or group day 
     care home may elect to receive the reimbursement factors 
     prescribed under clause (ii)(III) solely for the children 
     participating in a program referred to in item (bb) if the 
     home elects not to have income statements collected from 
     parents or other caretakers.

       ``(IV) Simplified meal counting and reporting procedures.--
     The Secretary shall prescribe simplified meal counting and 
     reporting procedures for use by a family or group day care 
     home that elects to claim the factors under subclause (II) 
     and by a family or group day care home sponsoring 
     organization that sponsors the home. The procedures the 
     Secretary prescribes may include 1 or more of the following:

       ``(aa) Setting an annual percentage for each home of the 
     number of meals served that are to be reimbursed in 
     accordance with the reimbursement factors prescribed under 
     clause (ii)(III) and an annual percentage of the number of 
     meals served that are to be reimbursed in accordance with the 
     reimbursement factors prescribed under subclause (I), based 
     on the family income of children enrolled in the home in a 
     specified month or other period.
       ``(bb) Placing a home into 1 of 2 or more reimbursement 
     categories annually based on the percentage of children in 
     the home whose households have incomes that meet the income 
     eligibility guidelines under section 9, with each such 
     reimbursement category carrying a set of reimbursement 
     factors such as the factors prescribed under clause (ii)(III) 
     or subclause (I) or factors established within the range 
     of factors prescribed under clause (ii)(III) and subclause 
     (I).
       ``(cc) Such other simplified procedures as the Secretary 
     may prescribe.

       ``(V) Minimum verification requirements.--The Secretary may 
     establish any necessary minimum verification requirements.''.

       (2) Grants to states to provide assistance to family or 
     group day care homes.--Section 17(f)(3) of the Act is amended 
     by adding at the end the following:
       ``(D) Grants to states to provide assistance to family or 
     group day care homes.--
       ``(i) In general.--

       ``(I) Reservation.--From amounts made available to carry 
     out this section, the Secretary shall reserve $5,000,000 of 
     the amount made available for fiscal year 1997.
       ``(II) Purpose.--The Secretary shall use the funds made 
     available under subclause (I) to provide grants to States for 
     the purpose of providing--

       ``(aa) assistance, including grants, to family and day care 
     home sponsoring organizations and other appropriate 
     organizations, in securing and providing training, materials, 
     automated data processing assistance, and other assistance 
     for the staff of the sponsoring organizations; and
       ``(bb) training and other assistance to family and group 
     day care homes in the implementation of the amendment to 
     subparagraph (A) made by section 3208(e)(1) of the Personal 
     Responsibility and Work Opportunity Act of 1996.
       ``(ii) Allocation.--The Secretary shall allocate from the 
     funds reserved under clause (i)(I)--

       ``(I) $30,000 in base funding to each State; and
       ``(II) any remaining amount among the States, based on the 
     number of family day care homes participating in the program 
     in a State during fiscal year 1995 as a percentage of the 
     number of all family day care homes participating in the 
     program during fiscal year 1995.

       ``(iii) Retention of funds.--Of the amount of funds made 
     available to a State for fiscal year 1997 under clause (i), 
     the State may retain not to exceed 30 percent of the amount 
     to carry out this subparagraph.
       ``(iv) Additional payments.--Any payments received under 
     this subparagraph shall be in addition to payments that a 
     State receives under subparagraph (A).''.
       (3) Provision of data.--Section 17(f)(3) of the Act, as 
     amended by paragraph (2), is further amended by adding at the 
     end the following:
       ``(E) Provision of data to family or group day care home 
     sponsoring organizations.--
       ``(i) Census data.--The Secretary shall provide to each 
     State agency administering a child care food program under 
     this section data from the most recent decennial census 
     survey or other appropriate census survey for which the data 
     are available showing which areas in the State meet the 
     requirements of subparagraph (A)(ii)(I)(aa). The State agency 
     shall provide the data to family or group day care home 
     sponsoring organizations located in the State.
       ``(ii) School data.--

       ``(I) In general.--A State agency administering the school 
     lunch program under this Act or the school breakfast program 
     under the Child Nutrition Act of 1966 (42 U.S.C. 1771 et 
     seq.) shall provide to approved family or group day care 
     home sponsoring organizations a list of schools serving 
     elementary school children in the State in which not less 
     than \1/2\ of the children enrolled are certified to 
     receive free or reduced price meals. The State agency 
     shall collect the data necessary to create the list 
     annually and provide the list on a timely basis to any 
     approved family or group day care home sponsoring 
     organization that requests the list.

       ``(II) Use of data from preceding school year.--In 
     determining for a fiscal year or other annual period whether 
     a home qualifies as a tier I family or group day care home 
     under subparagraph (A)(ii)(I), the State agency administering 
     the program under this section, and a family or group day 
     care home sponsoring organization, shall use the most current 
     available data at the time of the determination.

       ``(iii) Duration of determination.--For purposes of this 
     section, a determination that a family or group day care home 
     is located in an area that qualifies the home as a tier I 
     family or group day care home (as the term is defined in 
     subparagraph (A)(ii)(I)), shall be in effect for 3 years 
     (unless the determination is made on the basis of census 
     data, in which case the determination shall remain in effect 
     until more recent census data are available) unless the State 
     agency determines that the area in which the home is located 
     no longer qualifies the home as a tier I family or group day 
     care home.''.
       (4) Conforming amendments.--Section 17(c) of the Act is 
     amended by inserting ``except as provided in subsection 
     (f)(3),'' after ``For purposes of this section,'' each place 
     it appears in paragraphs (1), (2), and (3).
       (f) Reimbursement.--Section 17(f) of the Act is amended--
       (1) in paragraph (3)--
       (A) in subparagraph (B), by striking the third and fourth 
     sentences; and
       (B) in subparagraph (C)--
       (i) by striking ``(i)'' and
       (ii) by striking clause (ii); and
       (2) in paragraph (4), by striking ``shall'' and inserting 
     ``may'' in the first sentence.
       (g) Nutritional Requirements.--Section 17(g)(1) of the Act 
     is amended--
       (1) in subparagraph (A), by striking the second sentence; 
     and
       (2) in subparagraph (B), by striking the second sentence.
       (h) Elimination of State Paperwork and Outreach Burden.--
     Section 17 of the Act is amended by striking subsection (k) 
     and inserting the following:
       ``(k) Training and Technical Assistance.--A State 
     participating in the program established under this section 
     shall provide sufficient training, technical assistance, and 
     monitoring to facilitate effective operation of the program. 
     The Secretary shall assist the State in developing plans to 
     fulfill the requirements of this subsection.''.
       (i) Records.--The second sentence of section 17(m) of the 
     Act is amended by striking ``at all times'' and inserting 
     ``at any reasonable time''.
       (j) Modification of Adult Care Food Program.--Section 17(o) 
     of the Act is amended--
       (1) in the first sentence of paragraph (1)--
       (A) by striking ``adult day care centers'' and inserting 
     ``day care centers for chronically impaired disabled 
     persons''; and
       (B) by striking ``to persons 60 years of age or older or''; 
     and
       (2) in paragraph (2)--
       (A) in subparagraph (A)--
       (i) by striking ``adult day care center'' and inserting 
     ``day care center for chronically impaired disabled 
     persons''; and
       (ii) in clause (i)--

       (I) by striking ``adult'';
       (II) by striking ``adults'' and inserting ``persons''; and
       (III) by striking ``or persons 60 years of age or older''; 
     and

       (B) in subparagraph (B), by striking ``adult day care 
     services'' and inserting ``day care services for chronically 
     impaired disabled persons''.
       (k) Unneeded Provision.--Section 17 of the Act is amended 
     by striking subsection (q).
       (l) Conforming Amendments.--
       (1) Section 17B(f) of the Act (42 U.S.C. 1766b(f)) is 
     amended--
       (A) in the subsection heading, by striking ``and Adult''; 
     and
       (B) in paragraph (1), by striking ``and adult''.

[[Page H7840]]

       (2) Section 18(e)(3)(B) of the Act (42 U.S.C. 
     1769(e)(3)(B)) is amended by striking ``and adult''.
       (3) Section 25(b)(1)(C) of the Act (42 U.S.C. 
     1769f(b)(1)(C)) is amended by striking ``and adult''.
       (4) Section 3(1) of the Healthy Meals for Healthy Americans 
     Act of 1994 (Public Law 103-448) is amended by striking ``and 
     adult''.
       (m) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall become effective on the 
     date of enactment of this Act.
       (2) Improved targeting of day care home reimbursements.--
     The amendments made by paragraphs (1) and (4) of subsection 
     (e) shall become effective on July 1, 1997.
       (3) Regulations.--
       (A) Interim regulations.--Not later than January 1, 1997, 
     the Secretary shall issue interim regulations to implement--
       (i) the amendments made by paragraphs (1), (3), and (4) of 
     subsection (e); and
       (ii) section 17(f)(3)(C) of the National School Lunch Act 
     (42 U.S.C. 1766(f)(3)(C)).
       (B) Final regulations.--Not later than July 1, 1997, the 
     Secretary shall issue final regulations to implement the 
     provisions of law referred to in subparagraph (A).
       (n) Study of Impact of Amendments on Program Participation 
     and Family Day Care Licensing.--
       (1) In general.--The Secretary of Agriculture, in 
     conjunction with the Secretary of Health and Human Services, 
     shall study the impact of the amendments made by this section 
     on--
       (A) the number of family day care homes participating in 
     the child care food program established under section 17 of 
     the National School Lunch Act (42 U.S.C. 1766);
       (B) the number of day care home sponsoring organizations 
     participating in the program;
       (C) the number of day care homes that are licensed, 
     certified, registered, or approved by each State in 
     accordance with regulations issued by the Secretary;
       (D) the rate of growth of the numbers referred to in 
     subparagraphs (A) through (C);
       (E) the nutritional adequacy and quality of meals served in 
     family day care homes that--
       (i) received reimbursement under the program prior to the 
     amendments made by this section but do not receive 
     reimbursement after the amendments made by this section; or
       (ii) received full reimbursement under the program prior to 
     the amendments made by this section but do not receive full 
     reimbursement after the amendments made by this section; and
       (F) the proportion of low-income children participating in 
     the program prior to the amendments made by this section and 
     the proportion of low-income children participating in the 
     program after the amendments made by this section.
       (2) Required data.--Each State agency participating in the 
     child care food program under section 17 of the National 
     School Lunch Act (42 U.S.C. 1766) shall submit to the 
     Secretary data on--
       (A) the number of family day care homes participating in 
     the program on June 30, 1997, and June 30, 1998;
       (B) the number of family day care homes licensed, 
     certified, registered, or approved for service on June 30, 
     1997, and June 30, 1998; and
       (C) such other data as the Secretary may require to carry 
     out this subsection.
       (3) Submission of report.--Not later than 2 years after the 
     effective date of this section, the Secretary shall submit 
     the study required under this subsection to the Committee on 
     Economic and Educational Opportunities of the House of 
     Representatives and the Committee on Agriculture, Nutrition, 
     and Forestry of the Senate.

     SEC. 3209. PILOT PROJECTS.

       (a) Universal Free Pilot.--Section 18(d) of the National 
     School Lunch Act (42 U.S.C. 1769(d)) is amended--
       (1) by striking paragraph (3); and
       (2) by redesignating paragraphs (4) and (5) as paragraphs 
     (3) and (4), respectively.
       (b) Demo Project Outside School Hours.--Section 18(e) of 
     the Act is amended--
       (1) in paragraph (1)--
       (A) in subparagraph (A)--
       (i) by striking ``(A)''; and
       (ii) by striking ``shall'' and inserting ``may''; and
       (B) by striking subparagraph (B); and
       (2) by striking paragraph (5) and inserting the following:
       ``(5) Authorization of appropriations.--There are 
     authorized to be appropriated to carry out this subsection 
     such sums as are necessary for each of fiscal years 1997 and 
     1998.''.
       (c) Eliminating Projects.--Section 18 of the Act is 
     amended--
       (1) by striking subsections (a) and (g) through (i); and
       (2) by redesignating subsections (b) through (f), as so 
     amended, as subsections (a) through (e), respectively.
       (d) Conforming Amendment.--Section 17B(d)(1)(A) of the Act 
     (42 U.S.C. 1766b(d)(1)(A)) is amended by striking ``18(c)'' 
     and inserting ``18(b)''.

     SEC. 3210. REDUCTION OF PAPERWORK.

       Section 19 of the National School Lunch Act (42 U.S.C. 
     1769a) is repealed.

     SEC. 3211. INFORMATION ON INCOME ELIGIBILITY.

       Section 23 of the National School Lunch Act (42 U.S.C. 
     1769d) is repealed.

     SEC. 3212. NUTRITION GUIDANCE FOR CHILD NUTRITION PROGRAMS.

       Section 24 of the National School Lunch Act (42 U.S.C. 
     1769e) is repealed.

     SEC. 3213. INFORMATION CLEARINGHOUSE.

       Section 26 of the National School Lunch Act (42 U.S.C. 
     1769g) is repealed.

                 CHAPTER 2--CHILD NUTRITION ACT OF 1966

     SEC. 3221. SPECIAL MILK PROGRAM.

       Section 3(a)(3) of the Child Nutrition Act of 1966 (42 
     U.S.C. 1772(a)(3)) is amended by striking ``the Trust 
     Territory of the Pacific Islands'' and inserting ``the 
     Commonwealth of the Northern Mariana Islands''.

     SEC. 3222. FREE AND REDUCED PRICE POLICY STATEMENT.

       Section 4(b)(1) of the Child Nutrition Act of 1966 (42 
     U.S.C. 1773(b)(1)) is amended by adding at the end the 
     following:
       ``(E) Free and reduced price policy statement.--After the 
     initial submission, a school shall not be required to submit 
     a free and reduced price policy statement to a State 
     educational agency under this Act unless there is a 
     substantive change in the free and reduced price policy of 
     the school. A routine change in the policy of a school, such 
     as an annual adjustment of the income eligibility guidelines 
     for free and reduced price meals, shall not be sufficient 
     cause for requiring the school to submit a policy 
     statement.''.

     SEC. 3223. SCHOOL BREAKFAST PROGRAM AUTHORIZATION.

       (a) Training and Technical Assistance in Food 
     Preparation.--Section 4(e)(1) of the Child Nutrition Act of 
     1966 (42 U.S.C. 1773(e)(1)) is amended--
       (1) in subparagraph (A), by striking ``(A)''; and
       (2) by striking subparagraph (B).
       (b) Expansion of Program; Startup and Expansion Costs.--
       (1) In general.--Section 4 of the Act is amended by 
     striking subsections (f) and (g).
       (2) Effective date.--The amendments made by paragraph (1) 
     shall become effective on October 1, 1996.

     SEC. 3224. STATE ADMINISTRATIVE EXPENSES.

       (a) Use of Funds for Commodity Distribution Administration; 
     Studies.--Section 7 of the Child Nutrition Act of 1966 (42 
     U.S.C. 1776) is amended--
       (1) by striking subsections (e) and (h); and
       (2) by redesignating subsections (f), (g), and (i) as 
     subsections (e), (f), and (g), respectively.
       (b) Approval of Changes.--Section 7(e) of the Act, as so 
     redesignated, is amended--
       (1) by striking ``each year an annual plan'' and inserting 
     ``the initial fiscal year a plan''; and
       (2) by adding at the end the following: ``After submitting 
     the initial plan, a State shall only be required to submit to 
     the Secretary for approval a substantive change in the 
     plan.''.

     SEC. 3225. REGULATIONS.

       Section 10(b) of the Child Nutrition Act of 1966 (42 U.S.C. 
     1779(b)) is amended--
       (1) in paragraph (1), by striking ``(1)''; and
       (2) by striking paragraphs (2) through (4).

     SEC. 3226. PROHIBITIONS.

       Section 11(a) of the Child Nutrition Act of 1966 (42 U.S.C. 
     1780(a)) is amended by striking ``neither the Secretary nor 
     the State shall'' and inserting ``the Secretary shall not''.

     SEC. 3227. MISCELLANEOUS PROVISIONS AND DEFINITIONS.

       Section 15 of the Child Nutrition Act of 1966 (42 U.S.C. 
     1784) is amended--
       (1) in paragraph (1), by striking ``the Trust Territory of 
     the Pacific Islands'' and inserting ``the Commonwealth of the 
     Northern Mariana Islands''; and
       (2) in the first sentence of paragraph (3)--
       (A) in subparagraph (A), by inserting ``and'' at the end; 
     and
       (B) by striking ``, and (C)'' and all that follows through 
     ``Governor of Puerto Rico''.

     SEC. 3228. ACCOUNTS AND RECORDS.

       The second sentence of section 16(a) of the Child Nutrition 
     Act of 1966 (42 U.S.C. 1785(a)) is amended by striking ``at 
     all times be available'' and inserting ``be available at any 
     reasonable time''.

     SEC. 3229. SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, 
                   INFANTS, AND CHILDREN.

       (a) Definitions.--Section 17(b) of the Child Nutrition Act 
     of 1966 (42 U.S.C. 1786(b)) is amended--
       (1) in paragraph (15)(B)(iii), by inserting ``of not more 
     than 365 days'' after ``accommodation''; and
       (2) in paragraph (16)--
       (A) in subparagraph (A), by adding ``and'' at the end; and
       (B) in subparagraph (B), by striking ``; and'' and 
     inserting a period; and
       (C) by striking subparagraph (C).
       (b) Secretary's Promotion of WIC.--Section 17(c) of the Act 
     is amended by striking paragraph (5).
       (c) Eligible Participants.--Section 17(d) of the Act is 
     amended by striking paragraph (4).
       (d) Nutrition Education and Drug Abuse Education.--Section 
     17(e) of the Act is amended--
       (1) in the first sentence of paragraph (1), by striking 
     ``shall ensure'' and all that follows through ``is provided'' 
     and inserting ``shall provide nutrition education and may 
     provide drug abuse education'';
       (2) in paragraph (2), by striking the third sentence;

[[Page H7841]]

       (3) in paragraph (4)--
       (A) in the matter preceding subparagraph (A), by striking 
     ``shall'';
       (B) by striking subparagraph (A);
       (C) by redesignating subparagraphs (B) and (C) as 
     subparagraphs (A) and (B), respectively;
       (D) in subparagraphs (A) and (B) (as redesignated), by 
     inserting ``shall'' before ``provide'' each place it appears;
       (E) in subparagraph (A) (as redesignated), by striking 
     ``and'' at the end;
       (F) in subparagraph (B) (as redesignated), by striking the 
     period and inserting ``; and''; and
       (G) by adding at the end the following:
       ``(C) may provide a local agency with materials describing 
     other programs for which participants in the program may be 
     eligible.'';
       (4) in paragraph (5), by striking ``The State'' and all 
     that follows through ``local agency shall'' and inserting 
     ``Each local agency shall''; and
       (5) by striking paragraph (6).
       (e) State Plan.--Section 17(f) of the Act is amended--
       (1) in paragraph (1)--
       (A) in subparagraph (A)--
       (i) by striking ``annually to the Secretary, by a date 
     specified by the Secretary, a'' and inserting ``to the 
     Secretary, by a date specified by the Secretary, an 
     initial''; and
       (ii) by adding at the end the following: ``After submitting 
     the initial plan, a State shall only be required to submit to 
     the Secretary for approval a substantive change in the 
     plan.'';
       (B) in subparagraph (C)--
       (i) by striking clause (iii) and inserting the following:
       ``(iii) a plan to coordinate operations under the program 
     with other services or programs that may benefit participants 
     in, and applicants for, the program;'';
       (ii) in clause (vi), by inserting after ``in the State'' 
     the following: ``(including a plan to improve access to the 
     program for participants and prospective applicants who are 
     employed, or who reside in rural areas)'';
       (iii) in clause (vii), by striking ``to provide program 
     benefits'' and all that follows through ``emphasis on'' and 
     inserting ``for'';
       (iv) by striking clauses (ix), (x), and (xii);
       (v) in clause (xiii), by striking ``may require'' and 
     inserting ``may reasonably require''; and
       (vi) by redesignating clauses (xi) and (xiii), as so 
     amended, as clauses (ix) and (x), respectively;
       (C) by striking subparagraph (D); and
       (D) by redesignating subparagraph (E) as subparagraph (D);
       (2) by striking paragraphs (2), (6), (8), and (22);
       (3) in the second sentence of paragraph (5), by striking 
     ``at all times be available'' and inserting ``be available at 
     any reasonable time'';
       (4) in paragraph (9)(B), by striking the second sentence;
       (5) in the first sentence of paragraph (11), by striking 
     ``, including standards that will ensure sufficient State 
     agency staff'';
       (6) in paragraph (12), by striking the third sentence;
       (7) in paragraph (14), by striking ``shall'' and inserting 
     ``may'';
       (8) in paragraph (17), by striking ``and to accommodate'' 
     and all that follows through ``facilities'';
       (9) in paragraph (19), by striking ``shall'' and inserting 
     ``may''; and
       (10) by redesignating paragraphs (3), (4), (5), (7), (9) 
     through (19), (20), (21), (23), and (24), as so amended, as 
     paragraphs (2), (3), (4), (5), (6) through (16), (17), (18), 
     (19), and (20), respectively.
       (f) Information.--Section 17(g) of the Act is amended--
       (1) in paragraph (5), by striking ``the report required 
     under subsection (d)(4)'' and inserting ``reports on program 
     participant characteristics''; and
       (2) by striking paragraph (6).
       (g) Procurement of Infant Formula.--
       (1) In general.--Section 17(h) of the Act is amended--
       (A) in paragraph (4)(E), by striking ``and, on'' and all 
     that follows through ``(d)(4)'';
       (B) in paragraph (8)--
       (i) by striking subparagraphs (A), (C), and (M);
       (ii) in subparagraph (G)--

       (I) in clause (i), by striking ``(i)''; and
       (II) by striking clauses (ii) through (ix);

       (iii) in subparagraph (I), by striking ``Secretary--'' and 
     all that follows through ``(v) may'' and inserting 
     ``Secretary may'';
       (iv) by redesignating subparagraphs (B) and (D) through (L) 
     as subparagraphs (A) and (B) through (J), respectively;
       (v) in subparagraph (A)(i), as so redesignated, by striking 
     ``subparagraphs (C), (D), and (E)(iii), in carrying out 
     subparagraph (A),'' and inserting ``subparagraphs (B) and 
     (C)(iii),'';
       (vi) in subparagraph (B)(i), as so redesignated, by 
     striking ``subparagraph (B)'' each place it appears and 
     inserting ``subparagraph (A)''; and
       (vii) in subparagraph (C)(iii), as so redesignated, by 
     striking ``subparagraph (B)'' and inserting ``subparagraph 
     (A)''; and
       (C) in paragraph (10)(B)--
       (i) in clause (i), by striking the semicolon and inserting 
     ``; and'';
       (ii) in clause (ii), by striking ``; and'' and inserting a 
     period; and
       (iii) by striking clause (iii).
       (2) Application.--The amendments made by paragraph (1) 
     shall not apply to a contract for the procurement of infant 
     formula under section 17(h)(8) of the Act that is in effect 
     on the effective date of this subsection.
       (h) National Advisory Council on Maternal, Infant, and 
     Fetal Nutrition.--Section 17(k)(3) of the Act is amended by 
     striking ``Secretary shall designate'' and inserting 
     ``Council shall elect''.
       (i) Completed Study; Community College Demonstration; 
     Grants for Information and Data System.--Section 17 of the 
     Act is amended by striking subsections (n), (o), and (p).
       (j) Disqualification of Vendors Who Are Disqualified Under 
     the Food Stamp Program.--Section 17 of the Act, as so 
     amended, is further amended by adding at the end the 
     following:
       ``(n) Disqualification of Vendors Who Are Disqualified 
     Under the Food Stamp Program.--
       ``(1) In general.--The Secretary shall issue regulations 
     providing criteria for the disqualification under this 
     section of an approved vendor that is disqualified from 
     accepting benefits under the food stamp program established 
     under the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.).
       ``(2) Terms.--A disqualification under paragraph (1)--
       ``(A) shall be for the same period as the disqualification 
     from the program referred to in paragraph (1);
       ``(B) may begin at a later date than the disqualification 
     from the program referred to in paragraph (1); and
       ``(C) shall not be subject to judicial or administrative 
     review.''.

     SEC. 3230. CASH GRANTS FOR NUTRITION EDUCATION.

       Section 18 of the Child Nutrition Act of 1966 (42 U.S.C. 
     1787) is repealed.

     SEC. 3231. NUTRITION EDUCATION AND TRAINING.

       (a) Findings.--Section 19 of the Child Nutrition Act of 
     1966 (42 U.S.C. 1788) is amended--
       (1) in subsection (a), by striking ``that--'' and all that 
     follows through the period at the end and inserting ``that 
     effective dissemination of scientifically valid information 
     to children participating or eligible to participate in the 
     school lunch and related child nutrition programs should be 
     encouraged.''; and
       (2) in subsection (b), by striking ``encourage'' and all 
     that follows through ``establishing'' and inserting 
     ``establish''.
       (b) Use of Funds.--Section 19(f) of the Act is amended--
       (1) in paragraph (1)--
       (A) by striking subparagraph (B); and
       (B) in subparagraph (A)--
       (i) by striking ``(A)'';
       (ii) by striking clauses (ix) through (xix);
       (iii) by redesignating clauses (i) through (viii) and (xx) 
     as subparagraphs (A) through (H) and (I), respectively;
       (iv) in subparagraph (I), as so redesignated, by striking 
     the period at the end and inserting ``; and''; and
       (v) by adding at the end the following:
       ``(J) other appropriate related activities, as determined 
     by the State.'';
       (2) by striking paragraphs (2) and (4); and
       (3) by redesignating paragraph (3) as paragraph (2).
       (c) Accounts, Records, and Reports.--The second sentence of 
     section 19(g)(1) of the Act is amended by striking ``at all 
     times be available'' and inserting ``be available at any 
     reasonable time''.
       (d) State Coordinators for Nutrition; State Plan.--Section 
     19(h) of the Act is amended--
       (1) in the second sentence of paragraph (1)--
       (A) by striking ``as provided in paragraph (2) of this 
     subsection''; and
       (B) by striking ``as provided in paragraph (3) of this 
     subsection'';
       (2) in paragraph (2), by striking the second and third 
     sentences; and
       (3) by striking paragraph (3).
       (e) Authorization of Appropriations.--Section 19(i) of the 
     Act is amended--
       (1) in the first sentence of paragraph (2)(A), by striking 
     ``and each succeeding fiscal year'';
       (2) by redesignating paragraphs (3) and (4) as paragraphs 
     (4) and (5), respectively; and
       (3) by inserting after paragraph (2) the following:
       ``(3) Fiscal years 1997 through 2002.--
       ``(A) In general.--There are authorized to be appropriated 
     to carry out this section $10,000,000 for each of fiscal 
     years 1997 through 2002.
       ``(B) Grants.--
       ``(i) In general.--Grants to each State from the amounts 
     made available under subparagraph (A) shall be based on a 
     rate of 50 cents for each child enrolled in schools or 
     institutions within the State, except that no State shall 
     receive an amount less than $75,000 per fiscal year.
       ``(ii) Insufficient funds.--If the amount made available 
     for any fiscal year is insufficient to pay the amount to 
     which each State is entitled under clause (i), the amount of 
     each grant shall be ratably reduced.''.
       (f) Assessment.--Section 19 of the Act is amended by 
     striking subsection (j).
       (g) Effective Date.--The amendments made by subsection (e) 
     shall become effective on October 1, 1996.

[[Page H7842]]

                  CHAPTER 3--MISCELLANEOUS PROVISIONS

     SEC. 3241. COORDINATION OF SCHOOL LUNCH, SCHOOL BREAKFAST, 
                   AND SUMMER FOOD SERVICE PROGRAMS.

       (a) Coordination.--
       (1) In general.--The Secretary of Agriculture shall develop 
     proposed changes to the regulations under the school lunch 
     program under the National School Lunch Act, the summer food 
     service program under section 13 of that Act, and the school 
     breakfast program under section 4 of the Child Nutrition Act 
     of 1966, for the purpose of simplifying and coordinating 
     those programs into a comprehensive meal program.
       (2) Consultation.--In developing proposed changes to the 
     regulations under paragraph (1), the Secretary of Agriculture 
     shall consult with local, State, and regional administrators 
     of the programs described in such paragraph.
       (b) Report.--Not later than November 1, 1997, the Secretary 
     of Agriculture shall submit to the Committee on Agriculture, 
     Nutrition, and Forestry of the Senate and the Committee on 
     Economic and Educational Opportunities of the House of 
     Representatives a report containing the proposed changes 
     developed under subsection (a).
                     Subtitle C--Related Provisions

     Sec. 3301. REQUIREMENT THAT DATA RELATING TO THE INCIDENCE OF 
                   POVERTY IN THE UNITED STATES BE PUBLISHED AT 
                   LEAST EVERY 2 YEARS.

       (a) In General.--The Secretary shall, to the extent 
     feasible, produce and publish for each State, county, and 
     local unit of general purpose government for which data have 
     been compiled in the then most recent census of population 
     under section 141(a) of title 13, United States Code, and for 
     each school district, data relating to the incidence of 
     poverty. Such data may be produced by means of sampling, 
     estimation, or any other method that the Secretary determines 
     will produce current, comprehensive, and reliable data.
       (b) Content; Frequency.--Data under this section--
       (1) shall include--
       (A) for each school district, the number of children age 5 
     to 17, inclusive, in families below the poverty level; and
       (B) for each State and county referred to in subsection 
     (a), the number of individuals age 65 or older below the 
     poverty level; and
       (2) shall be published--
       (A) for each State, county, and local unit of general 
     purpose government referred to in subsection (a), in 1997 and 
     at least every second year thereafter; and
       (B) for each school district, in 1999 and at least every 
     second year thereafter.
       (c) Authority To Aggregate.--
       (1) In general.--If reliable data could not otherwise be 
     produced, the Secretary may, for purposes of subsection 
     (b)(1)(A), aggregate school districts, but only to the extent 
     necessary to achieve reliability.
       (2) Information relating to use of authority.--Any data 
     produced under this subsection shall be appropriately 
     identified and shall be accompanied by a detailed explanation 
     as to how and why aggregation was used (including the 
     measures taken to minimize any such aggregation).
       (d) Report To Be Submitted Whenever Data Is Not Timely 
     Published.--If the Secretary is unable to produce and publish 
     the data required under this section for any State, county, 
     local unit of general purpose government, or school district 
     in any year specified in subsection (b)(2), a report shall be 
     submitted by the Secretary to the President of the Senate and 
     the Speaker of the House of Representatives, not later than 
     90 days before the start of the following year, enumerating 
     each government or school district excluded and giving the 
     reasons for the exclusion.
       (e) Criteria Relating to Poverty.--In carrying out this 
     section, the Secretary shall use the same criteria relating 
     to poverty as were used in the then most recent census of 
     population under section 141(a) of title 13, United States 
     Code (subject to such periodic adjustments as may be 
     necessary to compensate for inflation and other similar 
     factors).
       (f) Consultation.--The Secretary shall consult with the 
     Secretary of Education in carrying out the requirements of 
     this section relating to school districts.
       (g) Definition.--For the purpose of this section, the term 
     ``Secretary'' means the Secretary of Health and Human 
     Services.
       (h) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section $1,500,000 for 
     each of fiscal years 1997 through 2000.

     SEC. 3302. SENSE OF THE CONGRESS.

       It is the sense of the Congress that this title, and the 
     amendments made by this title, should not result in an 
     increase in the number of children who are hungry, homeless, 
     poor, or medically uninsured.

     SEC. 3303. LEGISLATIVE ACCOUNTABILITY.

       In the event that this title, or the amendments made by 
     this title, results in an increase in the number of children 
     in the United States who are hungry, homeless, poor, or 
     medically uninsured by the end of the fiscal year 1997, the 
     Congress--
       (1) shall revisit the provisions of this title, or the 
     amendments made by this title, which caused such increase; 
     and
       (2) shall, as soon as practicable thereafter, pass 
     legislation that stops the continuation of such increase.
                 TITLE IV--COMMITTEE ON WAYS AND MEANS

     SEC. 4001. SHORT TITLE.

       This title may be cited as the ``Personal Responsibility 
     and Work Opportunity Act of 1996''.

     SEC. 4002. TABLE OF CONTENTS.

       The table of contents of this title is as follows:

Sec. 4001. Short title.
Sec. 4002. Table of contents.

  Subtitle A--Block Grants for Temporary Assistance for Needy Families

Sec. 4101. Findings.
Sec. 4102. Reference to Social Security Act.
Sec. 4103. Block grants to States.
Sec. 4104. Services provided by charitable, religious, or private 
              organizations.
Sec. 4105. Census data on grandparents as primary caregivers for their 
              grandchildren.
Sec. 4106. Report on data processing.
Sec. 4107. Study on alternative outcomes measures.
Sec. 4108. Conforming amendments to the Social Security Act.
Sec. 4109. Conforming amendments to the Food Stamp Act of 1977 and 
              related provisions.
Sec. 4110. Conforming amendments to other laws.
Sec. 4111. Development of prototype of counterfeit-resistant social 
              security card required.
Sec. 4112. Disclosure of receipt of Federal funds.
Sec. 4113. Modifications to the job opportunities for certain low-
              income individuals program.
Sec. 4114. Secretarial submission of legislative proposal for technical 
              and conforming amendments.
Sec. 4115. Conforming amendments to medicaid program.
Sec. 4116. Effective date; transition rule.

                Subtitle B--Supplemental Security Income

Sec. 4200. Reference to Social Security Act.

                  Chapter 1--Eligibility Restrictions

Sec. 4201. Denial of SSI benefits for 10 years to individuals found to 
              have fraudulently misrepresented residence in order to 
              obtain benefits simultaneously in 2 or more States.
Sec. 4202. Denial of SSI benefits for fugitive felons and probation and 
              parole violators.
Sec. 4203. Treatment of prisoners.
Sec. 4204. Effective date of application for benefits.

               Chapter 2--Benefits For Disabled Children

Sec. 4211. Definition and eligibility rules.
Sec. 4212. Eligibility redeterminations and continuing disability 
              reviews.
Sec. 4213. Additional accountability requirements.
Sec. 4214. Reduction in cash benefits payable to institutionalized 
              individuals whose medical costs are covered by private 
              insurance.
Sec. 4215. Regulations.

              Chapter 3--Additional Enforcement Provisions

Sec. 4221. Installment payment of large past-due supplemental security 
              income benefits.
Sec. 4222. Recovery of supplemental security income overpayments from 
              social security benefits.
Sec. 4223. Regulations.

               Chapter 4--State Supplementation Programs

Sec. 4225. Repeal of maintenance of effort requirements applicable to 
              optional State programs for supplementation of SSI 
              benefits.

   Chapter 5--Studies Regarding Supplemental Security Income Program

Sec. 4231. Annual report on the supplemental security income program.
Sec. 4232. Study of disability determination process.
Sec. 4233. Study by General Accounting Office.

       Chapter 6--National Commission on the Future of Disability

Sec. 4241. Establishment.
Sec. 4242. Duties of the commission.
Sec. 4243. Membership.
Sec. 4244. Staff and support services.
Sec. 4245. Powers of commission.
Sec. 4246. Reports.
Sec. 4247. Termination.
Sec. 4248. Authorization of appropriations.

                       Subtitle C--Child Support

Sec. 4300. Reference to Social Security Act.

     Chapter 1--Eligibility For Services; Distribution of Payments

Sec. 4301. State obligation to provide child support enforcement 
              services.
Sec. 4302. Distribution of child support collections.
Sec. 4303. Privacy safeguards.
Sec. 4304. Rights to notification of hearings.

                  Chapter 2--Locate And Case Tracking

Sec. 4311. State case registry.
Sec. 4312. Collection and disbursement of support payments.
Sec. 4313. State directory of new hires.
Sec. 4314. Amendments concerning income withholding.
Sec. 4315. Locator information from interstate networks.

[[Page H7843]]

Sec. 4316. Expansion of the Federal Parent Locator Service.
Sec. 4317. Collection and use of social security numbers for use in 
              child support enforcement.

          Chapter 3--Streamlining And Uniformity of Procedures

Sec. 4321. Adoption of uniform State laws.
Sec. 4322. Improvements to full faith and credit for child support 
              orders.
Sec. 4323. Administrative enforcement in interstate cases.
Sec. 4324. Use of forms in interstate enforcement.
Sec. 4325. State laws providing expedited procedures.

                   Chapter 4--Paternity Establishment

Sec. 4331. State laws concerning paternity establishment.
Sec. 4332. Outreach for voluntary paternity establishment.
Sec. 4333. Cooperation by applicants for and recipients of part A 
              assistance.

             Chapter 5--Program Administration and Funding

Sec. 4341. Performance-based incentives and penalties.
Sec. 4342. Federal and State reviews and audits.
Sec. 4343. Required reporting procedures.
Sec. 4344. Automated data processing requirements.
Sec. 4345. Technical assistance.
Sec. 4346. Reports and data collection by the Secretary.
Sec. 4347. Child support delinquency penalty.

      Chapter 6--Establishment And Modification of Support Orders

Sec. 4351. Simplified process for review and adjustment of child 
              support orders.
Sec. 4352. Furnishing consumer reports for certain purposes relating to 
              child support.
Sec. 4353. Nonliability for financial institutions providing financial 
              records to State child support enforcement agencies in 
              child support cases.

                Chapter 7--Enforcement Of Support Orders

Sec. 4361. Internal Revenue Service collection of arrearages.
Sec. 4362. Authority to collect support from Federal employees.
Sec. 4363. Enforcement of child support obligations of members of the 
              Armed Forces.
Sec. 4364. Voiding of fraudulent transfers.
Sec. 4365. Work requirement for persons owing past-due child support.
Sec. 4366. Definition of support order.
Sec. 4367. Reporting arrearages to credit bureaus.
Sec. 4368. Liens.
Sec. 4369. State law authorizing suspension of licenses.
Sec. 4370. Denial of passports for nonpayment of child support.
Sec. 4371. International support enforcement.
Sec. 4372. Financial institution data matches.
Sec. 4373. Enforcement of orders against paternal or maternal 
              grandparents in cases of minor parents.
Sec. 4374. Nondischargeability in bankruptcy of certain debts for the 
              support of a child.

                       Chapter 8--Medical Support

Sec. 4376. Correction to ERISA definition of medical child support 
              order.
Sec. 4377. Enforcement of orders for health care coverage.

Chapter 9--Enhancing Responsibility and Opportunity for Non-residential 
                                Parents

Sec. 4381. Grants to States for access and visitation programs.

         Chapter 10--Effective Dates and Conforming Amendments

Sec. 4391. Effective dates and conforming amendments.

     Subtitle D--Restricting Welfare and Public Benefits for Aliens

Sec. 4400. Statements of national policy concerning welfare and 
              immigration.

              Chapter 1--Eligibility For Federal Benefits

Sec. 4401. Aliens who are not qualified aliens ineligible for Federal 
              public benefits.
Sec. 4402. Limited eligibility of qualified aliens for certain Federal 
              programs.
Sec. 4403. Five-year limited eligibility of qualified aliens for 
              Federal means-tested public benefit.
Sec. 4404. Notification and information reporting.

  Chapter 2--Eligibility For State and Local Public Benefits Programs

Sec. 4411. Aliens who are not qualified aliens or nonimmigrants 
              ineligible for State and local public benefits.
Sec. 4412. State authority to limit eligibility of qualified aliens for 
              State public benefits.

       Chapter 3--Attribution Of Income and Affidavits of Support

Sec. 4421. Federal attribution of sponsor's income and resources to 
              alien.
Sec. 4422. Authority for States to provide for attribution of sponsors 
              income and resources to the alien with respect to State 
              programs.
Sec. 4423. Requirements for sponsor's affidavit of support.

                     Chapter 4--General Provisions

Sec. 4431. Definitions.
Sec. 4432. Verification of eligibility for Federal public benefits.
Sec. 4433. Statutory construction.
Sec. 4434. Communication between State and local government agencies 
              and the Immigration and Naturalization Service.
Sec. 4435. Qualifying quarters.

     Chapter 5--Conforming Amendments Relating to Assisted Housing

Sec. 4441. Conforming amendments relating to assisted housing.

    Chapter 6--Earned Income Credit Denied to Unauthorized Employees

Sec. 4451. Earned income credit denied to individuals not authorized to 
              be employed in the United States.

                  Subtitle E--Reform of Public Housing

Sec. 4601. Fraud under means-tested welfare and public assistance 
              programs.

  Subtitle F--Child Protection Block Grant Programs and Foster Care, 
          Adoption Assistance, and Independent Living Programs

   Chapter 1--Child Protection Block Grant Program and Foster Care, 
          Adoption Assistance, and Independent Living Programs


  SUBCHAPTER A--BLOCK GRANTS TO STATES FOR THE PROTECTION OF CHILDREN

Sec. 4701. Establishment of program.
Sec. 4702. Conforming amendments.


SUBCHAPTER B--FOSTER CARE, ADOPTION ASSISTANCE, AND INDEPENDENT LIVING 
                                PROGRAMS

Sec. 4711. Conforming amendments to part E of title IV.


                      SUBCHAPTER C--MISCELLANEOUS

Sec. 4721. Secretarial submission of legislative proposal for technical 
              and conforming amendments.
Sec. 4722. Sense of the Congress regarding timely adoption of children.
Sec. 4723. Removal of barriers to interethnic adoption.
Sec. 4724. Effective date; transition rules.

            Chapter 2--Child And Family Services Block Grant

Sec. 4751. Child and family services block grant.
Sec. 4752. Reauthorizations.
Sec. 4753. Repeals.

         Subtitle G--Reductions in Federal Government Positions

Sec. 4801. Reductions.
Sec. 4802. Reductions in Federal bureaucracy.
Sec. 4803. Reducing personnel in Washington, D.C. area.

                       Subtitle H--Miscellaneous

Sec. 4901. Appropriation by State legislatures.
Sec. 4902. Sanctioning for testing positive for controlled substances.
Sec. 4903. Reduction in block grants to States for social services.
  Subtitle A--Block Grants for Temporary Assistance for Needy Families

     SEC. 4101. FINDINGS.

       The Congress makes the following findings:
       (1) Marriage is the foundation of a successful society.
       (2) Marriage is an essential institution of a successful 
     society which promotes the interests of children.
       (3) Promotion of responsible fatherhood and motherhood is 
     integral to successful child rearing and the well-being of 
     children.
       (4) In 1992, only 54 percent of single-parent families with 
     children had a child support order established and, of that 
     54 percent, only about one-half received the full amount due. 
     Of the cases enforced through the public child support 
     enforcement system, only 18 percent of the caseload has a 
     collection.
       (5) The number of individuals receiving aid to families 
     with dependent children (in this section referred to as 
     ``AFDC'') has more than tripled since 1965. More than two-
     thirds of these recipients are children. Eighty-nine percent 
     of children receiving AFDC benefits now live in homes in 
     which no father is present.
       (A)(i) The average monthly number of children receiving 
     AFDC benefits--
       (I) was 3,300,000 in 1965;
       (II) was 6,200,000 in 1970;
       (III) was 7,400,000 in 1980; and
       (IV) was 9,300,000 in 1992.
       (ii) While the number of children receiving AFDC benefits 
     increased nearly threefold between 1965 and 1992, the total 
     number of children in the United States aged 0 to 18 has 
     declined by 5.5 percent.
       (B) The Department of Health and Human Services has 
     estimated that 12,000,000 children will receive AFDC benefits 
     within 10 years.
       (C) The increase in the number of children receiving public 
     assistance is closely related to the increase in births to 
     unmarried women. Between 1970 and 1991, the percentage of 
     live births to unmarried women increased nearly threefold, 
     from 10.7 percent to 29.5 percent.
       (6) The increase of out-of-wedlock pregnancies and births 
     is well documented as follows:
       (A) It is estimated that the rate of nonmarital teen 
     pregnancy rose 23 percent from 54 pregnancies per 1,000 
     unmarried teenagers in 1976 to 66.7 pregnancies in 1991. The 
     overall

[[Page H7844]]

     rate of nonmarital pregnancy rose 14 percent from 90.8 
     pregnancies per 1,000 unmarried women in 1980 to 103 in both 
     1991 and 1992. In contrast, the overall pregnancy rate for 
     married couples decreased 7.3 percent between 1980 and 1991, 
     from 126.9 pregnancies per 1,000 married women in 1980 to 
     117.6 pregnancies in 1991.
       (B) The total of all out-of-wedlock births between 1970 and 
     1991 has risen from 10.7 percent to 29.5 percent and if the 
     current trend continues, 50 percent of all births by the year 
     2015 will be out-of-wedlock.
       (7) The negative consequences of an out-of-wedlock birth on 
     the mother, the child, the family, and society are well 
     documented as follows:
       (A) Young women 17 and under who give birth outside of 
     marriage are more likely to go on public assistance and to 
     spend more years on welfare once enrolled. These combined 
     effects of ``younger and longer'' increase total AFDC costs 
     per household by 25 percent to 30 percent for 17-year-olds.
       (B) Children born out-of-wedlock have a substantially 
     higher risk of being born at a very low or moderately low 
     birth weight.
       (C) Children born out-of-wedlock are more likely to 
     experience low verbal cognitive attainment, as well as more 
     child abuse, and neglect.
       (D) Children born out-of-wedlock were more likely to have 
     lower cognitive scores, lower educational aspirations, and a 
     greater likelihood of becoming teenage parents themselves.
       (E) Being born out-of-wedlock significantly reduces the 
     chances of the child growing up to have an intact marriage.
       (F) Children born out-of-wedlock are 3 times more likely to 
     be on welfare when they grow up.
       (8) Currently 35 percent of children in single-parent homes 
     were born out-of-wedlock, nearly the same percentage as that 
     of children in single-parent homes whose parents are divorced 
     (37 percent). While many parents find themselves, through 
     divorce or tragic circumstances beyond their control, facing 
     the difficult task of raising children alone, nevertheless, 
     the negative consequences of raising children in single-
     parent homes are well documented as follows:
       (A) Only 9 percent of married-couple families with children 
     under 18 years of age have income below the national poverty 
     level. In contrast, 46 percent of female-headed households 
     with children under 18 years of age are below the national 
     poverty level.
       (B) Among single-parent families, nearly \1/2\ of the 
     mothers who never married received AFDC while only \1/5\ of 
     divorced mothers received AFDC.
       (C) Children born into families receiving welfare 
     assistance are 3 times more likely to be on welfare when they 
     reach adulthood than children not born into families 
     receiving welfare.
       (D) Mothers under 20 years of age are at the greatest risk 
     of bearing low-birth-weight babies.
       (E) The younger the single parent mother, the less likely 
     she is to finish high school.
       (F) Young women who have children before finishing high 
     school are more likely to receive welfare assistance for a 
     longer period of time.
       (G) Between 1985 and 1990, the public cost of births to 
     teenage mothers under the aid to families with dependent 
     children program, the food stamp program, and the medicaid 
     program has been estimated at $120,000,000,000.
       (H) The absence of a father in the life of a child has a 
     negative effect on school performance and peer adjustment.
       (I) Children of teenage single parents have lower cognitive 
     scores, lower educational aspirations, and a greater 
     likelihood of becoming teenage parents themselves.
       (J) Children of single-parent homes are 3 times more likely 
     to fail and repeat a year in grade school than are children 
     from intact 2-parent families.
       (K) Children from single-parent homes are almost 4 times 
     more likely to be expelled or suspended from school.
       (L) Neighborhoods with larger percentages of youth aged 12 
     through 20 and areas with higher percentages of single-parent 
     households have higher rates of violent crime.
       (M) Of those youth held for criminal offenses within the 
     State juvenile justice system, only 29.8 percent lived 
     primarily in a home with both parents. In contrast to these 
     incarcerated youth, 73.9 percent of the 62,800,000 children 
     in the Nation's resident population were living with both 
     parents.
       (9) Therefore, in light of this demonstration of the crisis 
     in our Nation, it is the sense of the Congress that 
     prevention of out-of-wedlock pregnancy and reduction in out-
     of-wedlock birth are very important Government interests and 
     the policy contained in part A of title IV of the Social 
     Security Act (as amended by section 4103(a) of this Act) is 
     intended to address the crisis.

     SEC. 4102. REFERENCE TO SOCIAL SECURITY ACT.

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

     SEC. 4103. BLOCK GRANTS TO STATES.

       (a) In General.--Part A of title IV (42 U.S.C. 601 et seq.) 
     is amended--
       (1) by striking all that precedes section 418 (as added by 
     section 4803(b)(2) of this Act) and inserting the following:

  ``PART A--BLOCK GRANTS TO STATES FOR TEMPORARY ASSISTANCE FOR NEEDY 
                                FAMILIES

     ``SEC. 401. PURPOSE.

       ``(a) In General.--The purpose of this part is to increase 
     the flexibility of States in operating a program designed 
     to--
       ``(1) provide assistance to needy families so that children 
     may be cared for in their own homes or in the homes of 
     relatives;
       ``(2) end the dependence of needy parents on government 
     benefits by promoting job preparation, work, and marriage;
       ``(3) prevent and reduce the incidence of out-of-wedlock 
     pregnancies and establish annual numerical goals for 
     preventing and reducing the incidence of these pregnancies; 
     and
       ``(4) encourage the formation and maintenance of two-parent 
     families.
       ``(b) No Individual Entitlement.--This part shall not be 
     interpreted to entitle any individual or family to assistance 
     under any State program funded under this part.

     ``SEC. 402. ELIGIBLE STATES; STATE PLAN.

       ``(a) In General.--As used in this part, the term `eligible 
     State' means, with respect to a fiscal year, a State that, 
     during the 2-year period immediately preceding the fiscal 
     year, has submitted to the Secretary a plan that the 
     Secretary has found includes the following:
       ``(1) Outline of family assistance program.--
       ``(A) General provisions.--A written document that outlines 
     how the State intends to do the following:
       ``(i) Conduct a program, designed to serve all political 
     subdivisions in the State (not necessarily in a uniform 
     manner), that provides assistance to needy families with (or 
     expecting) children and provides parents with job 
     preparation, work, and support services to enable them to 
     leave the program and become self-sufficient.
       ``(ii) Require a parent or caretaker receiving assistance 
     under the program to engage in work (as defined by the State) 
     once the State determines the parent or caretaker is ready to 
     engage in work, or once the parent or caretaker has received 
     assistance under the program for 24 months (whether or not 
     consecutive), whichever is earlier.
       ``(iii) Ensure that parents and caretakers receiving 
     assistance under the program engage in work activities in 
     accordance with section 407.
       ``(iv) Take such reasonable steps as the State deems 
     necessary to restrict the use and disclosure of information 
     about individuals and families receiving assistance under the 
     program attributable to funds provided by the Federal 
     Government.
       ``(B) Special provisions.--
       ``(i) The document shall indicate whether the State intends 
     to treat families moving into the State from another State 
     differently than other families under the program, and if so, 
     how the State intends to treat such families under the 
     program.
       ``(ii) The document shall indicate whether the State 
     intends to provide assistance under the program to 
     individuals who are not citizens of the United States, and 
     if so, shall include an overview of such assistance.
       ``(iii) The document shall set forth objective criteria for 
     the delivery of benefits and the determination of eligibility 
     and for fair and equitable treatment, including an 
     explanation of how the State will provide opportunities for 
     recipients who have been adversely affected to be heard in a 
     State administrative or appeal process.
       ``(2) Certification that the state will operate a child 
     support enforcement program.--A certification by the chief 
     executive officer of the State that, during the fiscal year, 
     the State will operate a child support enforcement program 
     under the State plan approved under part D.
       ``(3) Certification that the state will operate a child 
     protection program.--A certification by the chief executive 
     officer of the State that, during the fiscal year, the State 
     will operate a child protection program under the State plan 
     approved under part B.
       ``(4) Certification of the administration of the program.--
     A certification by the chief executive officer of the State 
     specifying which State agency or agencies will administer and 
     supervise the program referred to in paragraph (1) for the 
     fiscal year, which shall include assurances that local 
     governments and private sector organizations--
       ``(A) have been consulted regarding the plan and design of 
     welfare services in the State so that services are provided 
     in a manner appropriate to local populations; and
       ``(B) have had at least 45 days to submit comments on the 
     plan and the design of such services.
       ``(5) Certification that the state will provide indians 
     with equitable access to assistance.--A certification by the 
     chief executive officer of the State that, during the fiscal 
     year, the State will provide each Indian who is a member of 
     an Indian tribe in the State that does not have a tribal 
     family assistance plan approved under section 412 with 
     equitable access to assistance under the State program funded 
     under this part attributable to funds provided by the Federal 
     Government.
       ``(b) Public Availability of State Plan Summary.--The State 
     shall make available to the public a summary of any plan 
     submitted by the State under this section.

     ``SEC. 403. GRANTS TO STATES.

       ``(a) Grants.--

[[Page H7845]]

       ``(1) Family assistance grant.--
       ``(A) In general.--Each eligible State shall be entitled to 
     receive from the Secretary, for each of fiscal years 1996, 
     1997, 1998, 1999, 2000, and 2001 a grant in an amount equal 
     to the State family assistance grant.
       ``(B) State family assistance grant defined.--As used in 
     this part, the term `State family assistance grant' means the 
     greatest of--
       ``(i) \1/3\ of the total amount required to be paid to the 
     State under former section 403 (as in effect on September 30, 
     1995) for fiscal years 1992, 1993, and 1994 (other than with 
     respect to amounts expended by the State for child care under 
     subsection (g) or (i) of former section 402 (as so in 
     effect));
       ``(ii)(I) the total amount required to be paid to the State 
     under former section 403 for fiscal year 1994 (other than 
     with respect to amounts expended by the State for child care 
     under subsection (g) or (i) of former section 402 (as so in 
     effect)); plus
       ``(II) an amount equal to 85 percent of the amount (if any) 
     by which the total amount required to be paid to the State 
     under former section 403(a)(5) for emergency assistance 
     for fiscal year 1995 exceeds the total amount required to 
     be paid to the State under former section 403(a)(5) for 
     fiscal year 1994, if, during fiscal year 1994 or 1995, the 
     Secretary approved under former section 402 an amendment 
     to the former State plan to allow the provision of 
     emergency assistance in the context of family 
     preservation; or
       ``(iii) \4/3\ of the total amount required to be paid to 
     the State under former section 403 (as in effect on September 
     30, 1995) for the 1st 3 quarters of fiscal year 1995 (other 
     than with respect to amounts expended by the State under the 
     State plan approved under part F (as so in effect) or for 
     child care under subsection (g) or (i) of former section 402 
     (as so in effect)), plus the total amount required to be paid 
     to the State for fiscal year 1995 under former section 403(l) 
     (as so in effect).
       ``(C) Total amount required to be paid to the state under 
     former section 403 defined.--As used in this part, the term 
     `total amount required to be paid to the State under former 
     section 403' means, with respect to a fiscal year--
       ``(i) in the case of a State to which section 1108 does not 
     apply, the sum of--

       ``(I) the Federal share of maintenance assistance 
     expenditures for the fiscal year, before reduction pursuant 
     to subparagraph (B) or (C) of section 403(b)(2) (as in effect 
     on September 30, 1995), as reported by the State on ACF Form 
     231;
       ``(II) the Federal share of administrative expenditures 
     (including administrative expenditures for the development of 
     management information systems) for the fiscal year, as 
     reported by the State on ACF Form 231;
       ``(III) the Federal share of emergency assistance 
     expenditures for the fiscal year, as reported by the State on 
     ACF Form 231;
       ``(IV) the Federal share of expenditures for the fiscal 
     year with respect to child care pursuant to subsections (g) 
     and (i) of former section 402 (as in effect on September 30, 
     1995), as reported by the State on ACF Form 231; and
       ``(V) the aggregate amount required to be paid to the State 
     for the fiscal year with respect to the State program 
     operated under part F (as in effect on September 30, 1995), 
     as determined by the Secretary, including additional 
     obligations or reductions in obligations made after the close 
     of the fiscal year; and

       ``(ii) in the case of a State to which section 1108 
     applies, the lesser of--

       ``(I) the sum described in clause (i); or
       ``(II) the total amount certified by the Secretary under 
     former section 403 (as in effect during the fiscal year) with 
     respect to the territory.

       ``(D) Information to be used in determining amounts.--
       ``(i) For fiscal years 1992 and 1993.--

       ``(I) In determining the amounts described in subclauses 
     (I) through (IV) of subparagraph (C)(i) for any State for 
     each of fiscal years 1992 and 1993, the Secretary shall use 
     information available as of April 28, 1995.
       ``(II) In determining the amount described in subparagraph 
     (C)(i)(V) for any State for each of fiscal years 1992 and 
     1993, the Secretary shall use information available as of 
     January 6, 1995.

       ``(ii) For fiscal year 1994.--In determining the amounts 
     described in subparagraph (C)(i) for any State for fiscal 
     year 1994, the Secretary shall use information available as 
     of April 28, 1995.
       ``(iii) For fiscal year 1995.--

       ``(I) In determining the amount described in subparagraph 
     (B)(ii)(II) for any State for fiscal year 1995, the Secretary 
     shall use the information which was reported by the States 
     and estimates made by the States with respect to emergency 
     assistance expenditures and was available as of August 11, 
     1995.
       ``(II) In determining the amounts described in subclauses 
     (I) through (III) of subparagraph (C)(i) for any State for 
     fiscal year 1995, the Secretary shall use information 
     available as of October 2, 1995.
       ``(III) In determining the amount described in subparagraph 
     (C)(i)(IV) for any State for fiscal year 1995, the Secretary 
     shall use information available as of February 28, 1996.
       ``(IV) In determining the amount described in subparagraph 
     (C)(i)(V) for any State for fiscal year 1995, the Secretary 
     shall use information available as of October 5, 1995.

       ``(E) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there are 
     appropriated for fiscal years 1996, 1997, 1998, 1999, 2000, 
     and 2001 such sums as are necessary for grants under this 
     paragraph.
       ``(2) Grant to reward states that reduce out-of-wedlock 
     births.--
       ``(A) In general.--Each eligible State shall be entitled to 
     receive from the Secretary for fiscal year 1998 or any 
     succeeding fiscal year, a grant in an amount equal to the 
     State family assistance grant multiplied by--
       ``(i) 5 percent if--

       ``(I) the illegitimacy ratio of the State for the fiscal 
     year is at least 1 percentage point lower than the 
     illegitimacy ratio of the State for fiscal year 1995; and
       ``(II) the rate of induced pregnancy terminations in the 
     State for the fiscal year is less than the rate of induced 
     pregnancy terminations in the State for fiscal year 1995; or

       ``(ii) 10 percent if--

       ``(I) the illegitimacy ratio of the State for the fiscal 
     year is at least 2 percentage points lower than the 
     illegitimacy ratio of the State for fiscal year 1995; and
       ``(II) the rate of induced pregnancy terminations in the 
     State for the fiscal year is less than the rate of induced 
     pregnancy terminations in the State for fiscal year 1995.

       ``(B) Illegitimacy ratio.--As used in this paragraph, the 
     term `illegitimacy ratio' means, with respect to a State and 
     a fiscal year--
       ``(i) the number of out-of-wedlock births that occurred in 
     the State during the most recent fiscal year for which such 
     information is available; divided by
       ``(ii) the number of births that occurred in the State 
     during the most recent fiscal year for which such information 
     is available.
       ``(C) Disregard of changes in data due to changed reporting 
     methods.--For purposes of subparagraph (A), the Secretary 
     shall disregard--
       ``(i) any difference between the illegitimacy ratio of a 
     State for a fiscal year and the illegitimacy ratio of the 
     State for fiscal year 1995 which is attributable to a change 
     in State methods of reporting data used to calculate the 
     illegitimacy ratio; and
       ``(ii) any difference between the rate of induced pregnancy 
     terminations in a State for a fiscal year and such rate for 
     fiscal year 1995 which is attributable to a change in State 
     methods of reporting data used to calculate such rate.
       ``(D) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there are 
     appropriated for fiscal year 1998 and for each succeeding 
     fiscal year such sums as are necessary for grants under this 
     paragraph.
       ``(3) Supplemental grant for population increases in 
     certain states.--
       ``(A) In general.--Each qualifying State shall, subject to 
     subparagraph (F), be entitled to receive from the Secretary--
       ``(i) for fiscal year 1997 a grant in an amount equal to 
     2.5 percent of the total amount required to be paid to the 
     State under former section 403 (as in effect during fiscal 
     year 1994) for fiscal year 1994; and
       ``(ii) for each of fiscal years 1998, 1999, and 2000, a 
     grant in an amount equal to the sum of--

       ``(I) the amount (if any) required to be paid to the State 
     under this paragraph for the immediately preceding fiscal 
     year; and
       ``(II) 2.5 percent of the sum of--

       ``(aa) the total amount required to be paid to the State 
     under former section 403 (as in effect during fiscal year 
     1994) for fiscal year 1994; and
       ``(bb) the amount (if any) required to be paid to the State 
     under this paragraph for the fiscal year preceding the fiscal 
     year for which the grant is to be made.
       ``(B) Preservation of grant without increases for states 
     failing to remain qualifying states.--Each State that is not 
     a qualifying State for a fiscal year specified in 
     subparagraph (A)(ii) but was a qualifying State for a prior 
     fiscal year shall, subject to subparagraph (F), be entitled 
     to receive from the Secretary for the specified fiscal year, 
     a grant in an amount equal to the amount required to be paid 
     to the State under this paragraph for the most recent fiscal 
     year for which the State was a qualifying State.
       ``(C) Qualifying state.--
       ``(i) In general.--For purposes of this paragraph, a State 
     is a qualifying State for a fiscal year if--

       ``(I) the level of welfare spending per poor person by the 
     State for the immediately preceding fiscal year is less than 
     the national average level of State welfare spending per poor 
     person for such preceding fiscal year; and
       ``(II) the population growth rate of the State (as 
     determined by the Bureau of the Census) for the most recent 
     fiscal year for which information is available exceeds the 
     average population growth rate for all States (as so 
     determined) for such most recent fiscal year.

       ``(ii) State must qualify in fiscal year 1997.--
     Notwithstanding clause (i), a State shall not be a qualifying 
     State for any fiscal year after 1997 by reason of clause (i) 
     if the State is not a qualifying State for fiscal year 1997 
     by reason of clause (i).
       ``(iii) Certain states deemed qualifying states.--For 
     purposes of this paragraph, a State is deemed to be a 
     qualifying State for fiscal years 1997, 1998, 1999, and 2000 
     if--

       ``(I) the level of welfare spending per poor person by the 
     State for fiscal year 1996 is less than 35 percent of the 
     national average level of State welfare spending per poor 
     person for fiscal year 1996; or

[[Page H7846]]

       ``(II) the population of the State increased by more than 
     10 percent from April 1, 1990 to July 1, 1994, according to 
     the population estimates in publication CB94-204 of the 
     Bureau of the Census.
       ``(D) Definitions.--As used in this paragraph:
       ``(i) Level of welfare spending per poor person.--The term 
     `level of State welfare spending per poor person' means, with 
     respect to a State and a fiscal year--

       ``(I) the sum of--

       ``(aa) the total amount required to be paid to the State 
     under former section 403 (as in effect during fiscal year 
     1994) for fiscal year 1994; and
       ``(bb) the amount (if any) paid to the State under this 
     paragraph for the immediately preceding fiscal year; divided 
     by

       ``(II) the number of individuals, according to the 1990 
     decennial census, who were residents of the State and whose 
     income was below the poverty line.

       ``(ii) National average level of state welfare spending per 
     poor person.--The term `national average level of State 
     welfare spending per poor person' means, with respect to a 
     fiscal year, an amount equal to--

       ``(I) the total amount required to be paid to the States 
     under former section 403 (as in effect during fiscal year 
     1994) for fiscal year 1994; divided by
       ``(II) the number of individuals, according to the 1990 
     decennial census, who were residents of any State and whose 
     income was below the poverty line.

       ``(iii) State.--The term `State' means each of the 50 
     States of the United States and the District of Columbia.
       ``(E) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there are 
     appropriated for fiscal years 1997, 1998, 1999, and 2000 such 
     sums as are necessary for grants under this paragraph, in a 
     total amount not to exceed $800,000,000.
       ``(F) Grants reduced pro rata if insufficient 
     appropriations.--If the amount appropriated pursuant to this 
     paragraph for a fiscal year is less than the total amount of 
     payments otherwise required to be made under this paragraph 
     for the fiscal year, then the amount otherwise payable to any 
     State for the fiscal year under this paragraph shall be 
     reduced by a percentage equal to the amount so appropriated 
     divided by such total amount.
       ``(G) Budget scoring.--Notwithstanding section 257(b)(2) of 
     the Balanced Budget and Emergency Deficit Control Act of 
     1985, the baseline shall assume that no grant shall be made 
     under this paragraph after fiscal year 2000.
       ``(4) Bonus to reward high performance states.--
       ``(A) In general.--The Secretary shall make a grant 
     pursuant to this paragraph to each State for each bonus year 
     for which the State is a high performing State.
       ``(B) Amount of grant.--
       ``(i) In general.--Subject to clause (ii) of this 
     subparagraph, the Secretary shall determine the amount of the 
     grant payable under this paragraph to a high performing State 
     for a bonus year, which shall be based on the score assigned 
     to the State under subparagraph (D)(i) for the fiscal year 
     that immediately precedes the bonus year.
       ``(ii) Limitation.--The amount payable to a State under 
     this paragraph for a bonus year shall not exceed 5 percent of 
     the State family assistance grant.
       ``(C) Formula for measuring state performance.--Not later 
     than 1 year after the date of the enactment of the Personal 
     Responsibility and Work Opportunity Act of 1996, the 
     Secretary, in consultation with the National Governors' 
     Association and the American Public Welfare Association, 
     shall develop a formula for measuring State performance in 
     operating the State program funded under this part so as to 
     achieve the goals set forth in section 401(a).
       ``(D) Scoring of state performance; setting of performance 
     thresholds.--For each bonus year, the Secretary shall--
       ``(i) use the formula developed under subparagraph (C) to 
     assign a score to each eligible State for the fiscal year 
     that immediately precedes the bonus year; and
       ``(ii) prescribe a performance threshold in such a manner 
     so as to ensure that--

       ``(I) the average annual total amount of grants to be made 
     under this paragraph for each bonus year equals $100,000,000; 
     and
       ``(II) the total amount of grants to be made under this 
     paragraph for all bonus years equals $500,000,000.

       ``(E) Definitions.--As used in this paragraph:
       ``(i) Bonus year.--The term `bonus year' means fiscal years 
     1999, 2000, 2001, 2002, and 2003.
       ``(ii) High performing state.--The term `high performing 
     State' means, with respect a bonus year, an eligible State 
     whose score assigned pursuant to subparagraph (D)(i) for the 
     fiscal year immediately preceding the bonus year equals or 
     exceeds the performance threshold prescribed under 
     subparagraph (D)(ii) for such preceding fiscal year.
       ``(F) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there are 
     appropriated for fiscal years 1999 through 2003 $500,000,000 
     for grants under this paragraph.
       ``(5) Supplemental grant for operation of work program.--
       ``(A) Application requirements.--An eligible State may 
     submit to the Secretary an application for additional funds 
     to meet the requirements of section 407 with respect to a 
     fiscal year if the Secretary determines that--
       ``(i) the total expenditures of the State to meet such 
     requirements for the fiscal year exceed the total 
     expenditures of the State during fiscal year 1994 to carry 
     out part F (as in effect on September 30, 1994);
       ``(ii) the work programs of the State under this section 
     are coordinated with the job training programs established by 
     title II of the Job Training Partnership Act, or (if such 
     title is repealed by an Act that becomes law during the 104th 
     Congress) the Act that repeals such title; and
       ``(iii) the State needs additional funds to meet such 
     requirements or certifies that it intends to exceed such 
     requirements.
       ``(B) Grants.--The Secretary may make a grant to any 
     eligible State which submits an application in accordance 
     with subparagraph (A) for a fiscal year in an amount equal to 
     the Federal medical assistance percentage of the amount (if 
     any) by which the total expenditures of the State to meet or 
     exceed the requirements of section 407 for the fiscal year 
     exceeds the total expenditures of the State during fiscal 
     year 1994 to carry out part F (as in effect on September 30, 
     1994).
       ``(C) Regulations.--The Secretary shall issue regulations 
     providing for the equitable distribution of funds under this 
     paragraph.
       ``(D) Authorization of appropriations.--
       ``(i) In general.--There are authorized to be appropriated 
     for grants under this paragraph $3,000,000,000 for fiscal 
     year 1999.
       ``(ii) Availability.--Amounts appropriated pursuant to 
     clause (i) are authorized to remain available until expended.
       ``(b) Contingency Fund.--
       ``(1) Establishment.--There is hereby established in the 
     Treasury of the United States a fund which shall be known as 
     the `Contingency Fund for State Welfare Programs' (in this 
     section referred to as the `Fund').
       ``(2) Deposits into fund.--Out of any money in the Treasury 
     of the United States not otherwise appropriated, there are 
     appropriated for fiscal years 1997, 1998, 1999, 2000, and 
     2001 such sums as are necessary for payment to the Fund in a 
     total amount not to exceed $2,000,000,000.
       ``(3) Grants.--
       ``(A) Provisional payments.--If an eligible State submits 
     to the Secretary a request for funds under this paragraph 
     during an eligible month, the Secretary shall, subject to 
     this paragraph, pay to the State, from amounts appropriated 
     pursuant to paragraph (2), an amount equal to the amount of 
     funds so requested.
       ``(B) Payment priority.--The Secretary shall make payments 
     under subparagraph (A) in the order in which the Secretary 
     receives requests for such payments.
       ``(C) Limitations.--
       ``(i) Monthly payment to a state.--The total amount paid to 
     a single State under subparagraph (A) during a month shall 
     not exceed \1/12\ of 20 percent of the State family 
     assistance grant.
       ``(ii) Payments to all states.--The total amount paid to 
     all States under subparagraph (A) during fiscal years 1997 
     through 2001 shall not exceed the total amount appropriated 
     pursuant to paragraph (2).
       ``(4) Annual reconciliation.--Notwithstanding paragraph 
     (3), at the end of each fiscal year, each State shall remit 
     to the Secretary an amount equal to the amount (if any) by 
     which the total amount paid to the State under paragraph (3) 
     during the fiscal year exceeds--
       ``(A) the Federal medical assistance percentage for the 
     State for the fiscal year (as defined in section 1905(b), as 
     in effect on September 30, 1995) of the amount (if any) by 
     which the expenditures under the State program funded under 
     this part for the fiscal year exceed historic State 
     expenditures (as defined in section 409(a)(7)(B)(iii)); 
     multiplied by
       ``(B) \1/12\ times the number of months during the fiscal 
     year for which the Secretary makes a payment to the State 
     under this subsection.
       ``(5) Eligible month.--As used in paragraph (3)(A), the 
     term `eligible month' means, with respect to a State, a month 
     in the 2-month period that begins with any month for which 
     the State is a needy State.
       ``(6) Needy state.--For purposes of paragraph (5), a State 
     is a needy State for a month if--
       ``(A) the average rate of--
       ``(i) total unemployment in such State (seasonally 
     adjusted) for the period consisting of the most recent 3 
     months for which data for all States are published equals or 
     exceeds 6.5 percent; and
       ``(ii) total unemployment in such State (seasonally 
     adjusted) for the 3-month period equals or exceeds 110 
     percent of such average rate for either (or both) of the 
     corresponding 3-month periods ending in the 2 preceding 
     calendar years; or
       ``(B) as determined by the Secretary of Agriculture (in the 
     discretion of the Secretary of Agriculture), the monthly 
     average number of individuals (as of the last day of each 
     month) participating in the food stamp program in the 
     State in the then most recently concluded 3-month period 
     for which data are available exceeds by not less than 10 
     percent the lesser of--
       ``(i) the monthly average number of individuals (as of the 
     last day of each month) in the State that would have 
     participated in the food stamp program in the corresponding 
     3-month period in fiscal year 1994 if the amendments made by 
     subtitles D and J of

[[Page H7847]]

     the Personal Responsibility and Work Opportunity Act of 1996 
     had been in effect throughout fiscal year 1994; or
       ``(ii) the monthly average number of individuals (as of the 
     last day of each month) in the State that would have 
     participated in the food stamp program in the corresponding 
     3-month period in fiscal year 1995 if the amendments made by 
     subtitles D and J of the Personal Responsibility and Work 
     Opportunity Act of 1996 had been in effect throughout fiscal 
     year 1995.
       ``(7) Other terms defined.--As used in this subsection:
       ``(A) State.--The term `State' means each of the 50 States 
     of the United States and the District of Columbia.
       ``(B) Secretary.--The term `Secretary' means the Secretary 
     of the Treasury.
       ``(8) Annual reports.--The Secretary shall annually report 
     to the Congress on the status of the Fund.
       ``(9) Budget scoring.--Notwithstanding section 257(b)(2) of 
     the Balanced Budget and Emergency Deficit Control Act of 
     1985, the baseline shall assume that no grant shall be made 
     under this subsection after fiscal year 2001.

     ``SEC. 404. USE OF GRANTS.

       ``(a) General Rules.--Subject to this part, a State to 
     which a grant is made under section 403 may use the grant--
       ``(1) in any manner that is reasonably calculated to 
     accomplish the purpose of this part, including to provide low 
     income households with assistance in meeting home heating and 
     cooling costs; or
       ``(2) in any manner that the State was authorized to use 
     amounts received under part A or F, as such parts were in 
     effect on September 30, 1995.
       ``(b) Limitation on Use of Grant for Administrative 
     Purposes.--
       ``(1) Limitation.--A State to which a grant is made under 
     section 403 shall not expend more than 15 percent of the 
     grant for administrative purposes.
       ``(2) Exception.--Paragraph (1) shall not apply to the use 
     of a grant for information technology and computerization 
     needed for tracking or monitoring required by or under this 
     part.
       ``(c) Authority to Treat Interstate Immigrants Under Rules 
     of Former State.--A State operating a program funded under 
     this part may apply to a family the rules (including benefit 
     amounts) of the program funded under this part of another 
     State if the family has moved to the State from the other 
     State and has resided in the State for less than 12 months.
       ``(d) Authority to Use Portion of Grant for Other 
     Purposes.--
       ``(1) In general.--A State may use not more than 30 percent 
     of the amount of the grant made to the State under section 
     403 for a fiscal year to carry out a State program pursuant 
     to any or all of the following provisions of law:
       ``(A) Part B or E of this title.
       ``(B) Title XX of this Act.
       ``(C) The Child Care and Development Block Grant Act of 
     1990.
       ``(2) Applicable rules.--Any amount paid to the State under 
     this part that is used to carry out a State program pursuant 
     to a provision of law specified or described in paragraph (1) 
     shall not be subject to the requirements of this part, but 
     shall be subject to the requirements that apply to Federal 
     funds provided directly under the provision of law to 
     carry out the program.
       ``(e) Authority to Reserve Certain Amounts for 
     Assistance.--A State may reserve amounts paid to the State 
     under this part for any fiscal year for the purpose of 
     providing, without fiscal year limitation, assistance under 
     the State program funded under this part.
       ``(f) Authority to Operate Employment Placement Program.--A 
     State to which a grant is made under section 403 may use the 
     grant to make payments (or provide job placement vouchers) to 
     State-approved public and private job placement agencies that 
     provide employment placement services to individuals who 
     receive assistance under the State program funded under this 
     part.
       ``(g) Implementation of Electronic Benefit Transfer 
     System.--A State to which a grant is made under section 403 
     is encouraged to implement an electronic benefit transfer 
     system for providing assistance under the State program 
     funded under this part, and may use the grant for such 
     purpose.

     ``SEC. 405. ADMINISTRATIVE PROVISIONS.

       ``(a) Quarterly.--The Secretary shall pay each grant 
     payable to a State under section 403 in quarterly 
     installments.
       ``(b) Notification.--Not later than 3 months before the 
     payment of any such quarterly installment to a State, the 
     Secretary shall notify the State of the amount of any 
     reduction determined under section 412(a)(1)(B) with respect 
     to the State.
       ``(c) Computation and Certification of Payments to 
     States.--
       ``(1) Computation.--The Secretary shall estimate the amount 
     to be paid to each eligible State for each quarter under this 
     part, such estimate to be based on a report filed by the 
     State containing an estimate by the State of the total sum to 
     be expended by the State in the quarter under the State 
     program funded under this part and such other information as 
     the Secretary may find necessary.
       ``(2) Certification.--The Secretary of Health and Human 
     Services shall certify to the Secretary of the Treasury the 
     amount estimated under paragraph (1) with respect to a State, 
     reduced or increased to the extent of any overpayment or 
     underpayment which the Secretary of Health and Human Services 
     determines was made under this part to the State for any 
     prior quarter and with respect to which adjustment has not 
     been made under this paragraph.
       ``(d) Payment Method.--Upon receipt of a certification 
     under subsection (c)(2) with respect to a State, the 
     Secretary of the Treasury shall, through the Fiscal Service 
     of the Department of the Treasury and before audit or 
     settlement by the General Accounting Office, pay to the 
     State, at the time or times fixed by the Secretary of Health 
     and Human Services, the amount so certified.
       ``(e) Collection of State Overpayments to Families From 
     Federal Tax Refunds.--
       ``(1) In general.--Upon receiving notice from the Secretary 
     of Health and Human Services that a State agency 
     administering a program funded under this part has notified 
     the Secretary that a named individual has been overpaid under 
     the State program funded under this part, the Secretary of 
     the Treasury shall determine whether any amounts as refunds 
     of Federal taxes paid are payable to such individual, 
     regardless of whether the individual filed a tax return as a 
     married or unmarried individual. If the Secretary of the 
     Treasury finds that any such amount is so payable, the 
     Secretary shall withhold from such refunds an amount equal to 
     the overpayment sought to be collected by the State and pay 
     such amount to the State agency.
       ``(2) Regulations.--The Secretary of the Treasury shall 
     issue regulations, after review by the Secretary of Health 
     and Human services, that provide--
       ``(A) that a State may only submit under paragraph (1) 
     requests for collection of overpayments with respect to 
     individuals--
       ``(i) who are no longer receiving assistance under the 
     State program funded under this part;
       ``(ii) with respect to whom the State has already taken 
     appropriate action under State law against the income or 
     resources of the individuals or families involved to collect 
     the past-due legally enforceable debt; and
       ``(iii) to whom the State agency has given notice of its 
     intent to request withholding by the Secretary of the 
     Treasury from the income tax refunds of such individuals;
       ``(B) that the Secretary of the Treasury will give a timely 
     and appropriate notice to any other person filing a joint 
     return with the individual whose refund is subject to 
     withholding under paragraph (1); and
       ``(C) the procedures that the State and the Secretary of 
     the Treasury will follow in carrying out this subsection 
     which, to the maximum extent feasible and consistent with the 
     provisions of this subsection, will be the same as those 
     issued pursuant to section 464(b) applicable to collection of 
     past-due child support.

     ``SEC. 406. FEDERAL LOANS FOR STATE WELFARE PROGRAMS.

       ``(a) Loan Authority.--
       ``(1) In general.--The Secretary shall make loans to any 
     loan-eligible State, for a period to maturity of not more 
     than 3 years.
       ``(2) Loan-eligible state.--As used in paragraph (1), the 
     term `loan-eligible State' means a State against which a 
     penalty has not been imposed under section 409(a)(1).
       ``(b) Rate of Interest.--The Secretary shall charge and 
     collect interest on any loan made under this section at a 
     rate equal to the current average market yield on outstanding 
     marketable obligations of the United States with remaining 
     periods to maturity comparable to the period to maturity of 
     the loan.
       ``(c) Use of Loan.--A State shall use a loan made to the 
     State under this section only for any purpose for which grant 
     amounts received by the State under section 403(a) may be 
     used, including--
       ``(1) welfare anti-fraud activities; and
       ``(2) the provision of assistance under the State program 
     to Indian families that have moved from the service area of 
     an Indian tribe with a tribal family assistance plan approved 
     under section 412.
       ``(d) Limitation on Total Amount of Loans to a State.--The 
     cumulative dollar amount of all loans made to a State under 
     this section during fiscal years 1997 through 2001 shall not 
     exceed 10 percent of the State family assistance grant.
       ``(e) Limitation on Total Amount of Outstanding Loans.--The 
     total dollar amount of loans outstanding under this section 
     may not exceed $1,700,000,000.
       ``(f) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there are 
     appropriated such sums as may be necessary for the cost of 
     loans under this section.

     ``SEC. 407. MANDATORY WORK REQUIREMENTS.

       ``(a) Participation Rate Requirements.--
       ``(1) All families.--A State to which a grant is made under 
     section 403 for a fiscal year shall achieve the minimum 
     participation rate specified in the following table for 
     the fiscal year with respect to all families receiving 
     assistance under the State program funded under this part:

                                                            The minimum
                                                          participation
    ``If the fiscal year is:                                   rate is:
      1997........................................................25   
      1998........................................................30   
      1999........................................................35   
      2000........................................................40   
      2001........................................................45   
      2002 or thereafter..........................................50.  


[[Page H7848]]


       ``(2) 2-parent families.--A State to which a grant is made 
     under section 403 for a fiscal year shall achieve the minimum 
     participation rate specified in the following table for the 
     fiscal year with respect to 2-parent families receiving 
     assistance under the State program funded under this part:

                                                            The minimum
                                                          participation
    ``If the fiscal year is:                                   rate is:
      1996........................................................50   
      1997........................................................75   
      1998........................................................75   
      1999 or thereafter..........................................90.  

       ``(b) Calculation of Participation Rates.--
       ``(1) All families.--
       ``(A) Average monthly rate.--For purposes of subsection 
     (a)(1), the participation rate for all families of a State 
     for a fiscal year is the average of the participation rates 
     for all families of the State for each month in the fiscal 
     year.
       ``(B) Monthly participation rates.--The participation rate 
     of a State for all families of the State for a month, 
     expressed as a percentage, is--
       ``(i) the number of families receiving assistance under the 
     State program funded under this part that include an adult 
     who is engaged in work for the month; divided by
       ``(ii) the amount by which--

       ``(I) the number of families receiving such assistance 
     during the month that include an adult receiving such 
     assistance; exceeds
       ``(II) the number of families receiving such assistance 
     that are subject in such month to a penalty described in 
     subsection (e)(1) but have not been subject to such penalty 
     for more than 3 months within the preceding 12-month period 
     (whether or not consecutive).

       ``(2) 2-parent families.--
       ``(A) Average monthly rate.--For purposes of subsection 
     (a)(2), the participation rate for 2-parent families of a 
     State for a fiscal year is the average of the participation 
     rates for 2-parent families of the State for each month in 
     the fiscal year.
       ``(B) Monthly participation rates.--The participation rate 
     of a State for 2-parent families of the State for a month 
     shall be calculated by use of the formula set forth in 
     paragraph (1)(B), except that in the formula the term `number 
     of 2-parent families' shall be substituted for the term 
     `number of families' each place such latter term appears.
       ``(3) Pro rata reduction of participation rate due to 
     caseload reductions not required by federal law.--
       ``(A) In general.--The Secretary shall prescribe 
     regulations for reducing the minimum participation rate 
     otherwise required by this section for a fiscal year by the 
     number of percentage points equal to the number of percentage 
     points (if any) by which--
       ``(i) the average monthly number of families receiving 
     assistance during the fiscal year under the State program 
     funded under this part is less than
       ``(ii) the average monthly number of families that received 
     aid under the State plan approved under part A (as in effect 
     on September 30, 1995) during fiscal year 1995.

     The minimum participation rate shall not be reduced to the 
     extent that the Secretary determines that the reduction in 
     the number of families receiving such assistance is required 
     by Federal law.
       ``(B) Eligibility changes not counted.--The regulations 
     described in subparagraph (A) shall not take into account 
     families that are diverted from a State program funded under 
     this part as a result of differences in eligibility criteria 
     under a State program funded under this part and eligibility 
     criteria under the State program operated under the State 
     plan approved under part A (as such plan and such part were 
     in effect on September 30, 1995). Such regulations shall 
     place the burden on the Secretary to prove that such 
     families were diverted as a direct result of differences 
     in such eligibility criteria.
       ``(4) State option to include individuals receiving 
     assistance under a tribal family assistance plan.--For 
     purposes of paragraphs (1)(B) and (2)(B), a State may, at its 
     option, include families receiving assistance under a tribal 
     family assistance plan approved under section 412.
       ``(5) State option for participation requirement 
     exemptions.--For any fiscal year, a State may, at its option, 
     not require an individual who is a single custodial parent 
     caring for a child who has not attained 12 months of age to 
     engage in work and may disregard such an individual in 
     determining the participation rates under subsection (a).
       ``(c) Engaged in Work.--
       ``(1) All families.--For purposes of subsection 
     (b)(1)(B)(i), a recipient is engaged in work for a month in a 
     fiscal year if the recipient is participating in work 
     activities for at least the minimum average number of hours 
     per week specified in the following table during the month, 
     not fewer than 20 hours per week of which are attributable to 
     an activity described in paragraph (1), (2), (3), (4), (5), 
     (6), (7), or (8) of subsection (d):

                                                            The minimum
      ``If the month is                               average number of
      in fiscal year:                                hours per week is:
        1996......................................................20   
        1997......................................................20   
        1998......................................................20   
        1999......................................................25   
        2000 or thereafter........................................30.  

       ``(2) 2-parent families.--For purposes of subsection 
     (b)(2)(B)(i), an adult is engaged in work for a month in a 
     fiscal year if the adult is making progress in work 
     activities for at least 35 hours per week during the month, 
     not fewer than 30 hours per week of which are attributable to 
     an activity described in paragraph (1), (2), (3), (4), (5), 
     (6), (7), or (8) of subsection (d).
       ``(3) Limitation on number of weeks for which job search 
     counts as work.--Notwithstanding paragraphs (1) and (2), an 
     individual shall not be considered to be engaged in work by 
     virtue of participation in an activity described in 
     subsection (d)(6), after the individual has participated in 
     such an activity for 8 weeks in a fiscal year, or if the 
     participation is for a week that is in a fiscal year and that 
     immediately follows 4 consecutive weeks of such participation 
     in the fiscal year. An individual shall be considered to be 
     participating in such an activity for a week if the 
     individual participates in such an activity at any time 
     during the week.
       ``(4) Limitation on vocational education activities counted 
     as work.--For purposes of determining monthly participation 
     rates under paragraphs (1)(B)(i) and (2)(B)(i) of subsection 
     (b), not more than 20 percent of adults in all families and 
     in 2-parent families determined to be engaged in work in the 
     State for a month may meet the work activity requirement 
     through participation in vocational educational training.
       ``(5) Single parent with child under age 6 deemed to be 
     meeting work participation requirements if parent is engaged 
     in work for 20 hours per week.--For purposes of determining 
     monthly participation rates under subsection (b)(1)(B)(i), a 
     recipient in a 1-parent family who is the parent of a child 
     who has not attained 6 years of age is deemed to be engaged 
     in work for a month if the recipient is engaged in work 
     for an average of at least 20 hours per week during the 
     month.
       ``(6) Teen head of household who maintains satisfactory 
     school attendance deemed to be meeting work participation 
     requirements.--For purposes of determining monthly 
     participation rates under subsection (b)(1)(B)(i), a 
     recipient who is a single head of household and has not 
     attained 20 years of age is deemed to be engaged in work for 
     a month in a fiscal year if the recipient--
       ``(A) maintains satisfactory attendance at secondary school 
     or the equivalent during the month; or
       ``(B) participates in education directly related to 
     employment for at least the minimum average number of hours 
     per week specified in the table set forth in paragraph (1).
       ``(d) Work Activities Defined.--As used in this section, 
     the term `work activities' means--
       ``(1) unsubsidized employment;
       ``(2) subsidized private sector employment;
       ``(3) subsidized public sector employment;
       ``(4) work experience (including work associated with the 
     refurbishing of publicly assisted housing) if sufficient 
     private sector employment is not available;
       ``(5) on-the-job training;
       ``(6) job search and job readiness assistance;
       ``(7) community service programs;
       ``(8) vocational educational training (not to exceed 12 
     months with respect to any individual);
       ``(9) job skills training directly related to employment;
       ``(10) education directly related to employment, in the 
     case of a recipient who has not received a high school 
     diploma or a certificate of high school equivalency; and
       ``(11) satisfactory attendance at secondary school, in the 
     case of a recipient who has not completed secondary school.
       ``(e) Penalties Against Individuals.--
       ``(1) In general.--Except as provided in paragraph (2), if 
     an adult in a family receiving assistance under the State 
     program funded under this part refuses to engage in work 
     required in accordance with this section, the State shall--
       ``(A) reduce the amount of assistance otherwise payable to 
     the family pro rata (or more, at the option of the State) 
     with respect to any period during a month in which the adult 
     so refuses; or
       ``(B) terminate such assistance,

     subject to such good cause and other exceptions as the State 
     may establish.
       ``(2) Exception.--Notwithstanding paragraph (1), a State 
     may not reduce or terminate assistance under the State 
     program funded under this part based on a refusal of an adult 
     to work if the adult is a single custodial parent caring for 
     a child who has not attained 11 years of age, and the adult 
     proves that the adult has a demonstrated inability (as 
     determined by the State) to obtain needed child care, for 1 
     or more of the following reasons:
       ``(A) Unavailability of appropriate child care within a 
     reasonable distance from the individual's home or work site.
       ``(B) Unavailability or unsuitability of informal child 
     care by a relative or under other arrangements.
       ``(C) Unavailability of appropriate and affordable formal 
     child care arrangements.
       ``(f) Nondisplacement in Work Activities.--
       ``(1) In general.--Subject to paragraph (2), an adult in a 
     family receiving assistance under a State program funded 
     under this part attributable to funds provided by the Federal 
     Government may fill a vacant employment position in order to 
     engage in a work activity described in subsection (d).
       ``(2) No filling of certain vacancies.--No adult in a work 
     activity described in subsection (d) which is funded, in 
     whole or in

[[Page H7849]]

     part, by funds provided by the Federal Government shall be 
     employed or assigned--
       ``(A) when any other individual is on layoff from the same 
     or any substantially equivalent job; or
       ``(B) if the employer has terminated the employment of any 
     regular employee or otherwise caused an involuntary reduction 
     of its workforce in order to fill the vacancy so created with 
     an adult described in paragraph (1).
       ``(3) No preemption.--Nothing in this subsection shall 
     preempt or supersede any provision of State or local law that 
     provides greater protection for employees from displacement.
       ``(g) Sense of the Congress.--It is the sense of the 
     Congress that in complying with this section, each State that 
     operates a program funded under this part is encouraged to 
     assign the highest priority to requiring adults in 2-parent 
     families and adults in single-parent families that include 
     older preschool or school-age children to be engaged in work 
     activities.
       ``(h) Sense of the Congress That States Should Impose 
     Certain Requirements on Noncustodial, Nonsupporting Minor 
     Parents.--It is the sense of the Congress that the States 
     should require noncustodial, nonsupporting parents who have 
     not attained 18 years of age to fulfill community work 
     obligations and attend appropriate parenting or money 
     management classes after school.
       ``(i) Review of Implementation of State Work Programs.--
     During fiscal year 1999, the Committee on Ways and Means of 
     the House of Representatives and the Committee on Finance of 
     the Senate shall hold hearings and engage in other 
     appropriate activities to review the implementation of this 
     section by the States, and shall invite the Governors of the 
     States to testify before them regarding such implementation. 
     Based on such hearings, such Committees may introduce such 
     legislation as may be appropriate to remedy any problems with 
     the State programs operated pursuant to this section.
       In section 404(d) of the Social Security Act, as proposed 
     to be added by section 4103(a)(1), strike paragraph (2) and 
     insert the following:
       ``(2) Limitation on amount transferable to title xx 
     programs.--Notwithstanding paragraph (1), not more than \1/3\ 
     of the total amount paid to a State under this part for a 
     fiscal year that is used to carry out State programs pursuant 
     to provisions of law specified in paragraph (1) may be used 
     to carry out State programs pursuant to title XX.
       ``(3) Applicable rules.--
       ``(A) In general.--Except as provided in subparagraph (B) 
     of this paragraph, any amount paid to a State under this part 
     that is used to carry out a State program pursuant to a 
     provision of law specified in paragraph (1) shall not be 
     subject to the requirements of this part, but shall be 
     subject to the requirements that apply to Federal funds 
     provided directly under the provision of law to carry out the 
     program.
       ``(B) Exception relating to title xx programs.--All amounts 
     paid to a State under this part that are used to carry out 
     State programs pursuant to title XX shall be used only for 
     programs and services to children or their families.
       At the end of section 408(a)(8) of the Social Security Act, 
     as proposed to be added by section 4103(a)(2), add the 
     following:
       ``(E) Rule of interpretation.--This part shall not be 
     interpreted to prohibit any State from expending State funds 
     not originating with the Federal Government on benefits for 
     children or families that have become ineligible for 
     assistance under the State program funded under this part by 
     reason of subparagraph (A).
       In section 409(a)(7)(B) of the Social Security Act, as 
     proposed to be added by section 4103(a)(1), strike clause 
     (ii) and insert the following:
       ``(ii) Applicable percentage.--The term `applicable 
     percentage' means for fiscal years 1997 through 2001, 80 
     percent (or, if the State meets the requirements of section 
     407(a) for the fiscal year, 75 percent) reduced (if 
     appropriate) in accordance with subparagraph (C)(ii).
       In section 1931(a) of the Social Security Act, as proposed 
     to be inserted by section 4115(a)(2)--
       (1) in paragraph (1), strike ``through (4)'' and insert 
     ``through (5)'',
       (2) in paragraph (3), strike ``and'' at the end,
       (3) in paragraph (4), strike the period at the end and 
     insert ``; and'', and
       (4) insert after paragraph (4) the following:
       ``(5) a State may terminate medical assistance under this 
     title for an individual because the individual fails to meet 
     any requirement imposed pursuant to section 407 if the 
     individual was eligible for the medical assistance--
       ``(A) on the basis of receipt of assistance under a State 
     program funded under part A of title IV, or
       ``(B) pursuant to paragraph (1), on the basis that the 
     individual meets the requirements for receipt of aid or 
     assistance under the State plan under part A of title IV (as 
     in effect on July 16, 1996).
       In paragraph (31)(B) of section 454 of the Social Security 
     Act, as proposed to be added by section 4347(3)--
       (1) strike ``and shall'' and insert ``shall''; and
       (2) insert ``, and shall permit the country office of the 
     State agency administering the State program under this part 
     which collected such amounts to retain an amount equal to 5 
     percent of the amount applied to the payment of such 
     penalties'' before the period.

     ``SEC. 408. PROHIBITIONS; REQUIREMENTS.

       ``(a) In General.--
       ``(1) No assistance for families without a minor child.--A 
     State to which a grant is made under section 403 shall not 
     use any part of the grant to provide assistance to a family, 
     unless the family includes--
       ``(A) a minor child who resides with a custodial parent or 
     other adult caretaker relative of the child; or
       ``(B) a pregnant individual.
       ``(2) No additional cash assistance for children born to 
     families receiving assistance.--
       ``(A) General rule.--A State to which a grant is made under 
     section 403 shall not use any part of the grant to provide 
     cash benefits for a minor child who is born to--
       ``(i) a recipient of assistance under the program operated 
     under this part; or
       ``(ii) a person who received such assistance at any time 
     during the 10-month period ending with the birth of the 
     child.
       ``(B) Exception for children born into families with no 
     other children.--Subparagraph (A) shall not apply to a minor 
     child who is born into a family that does not include any 
     other children.
       ``(C) Exception for vouchers.--Subparagraph (A) shall not 
     apply to vouchers which are provided in lieu of cash benefits 
     and which may be used only to pay for particular goods and 
     services specified by the State as suitable for the care of 
     the child involved.
       ``(D) Exception for rape or incest.--Subparagraph (A) shall 
     not apply with respect to a child who is born as a result of 
     rape or incest.
       ``(E) State election to opt out.--Subparagraph (A) shall 
     not apply to a State if State law specifically exempts the 
     State program funded under this part from the application of 
     subparagraph (A).
       ``(F) Substitution of family caps in effect under 
     waivers.--Subparagraph (A) shall not apply to a State--
       ``(i) if, as of the date of the enactment of this part, 
     there is in effect a waiver approved by the Secretary under 
     section 1115 which permits the State to deny aid under the 
     State plan approved under part A of this title (as in effect 
     without regard to the amendments made by subtitle A of the 
     Personal Responsibility and Work Opportunity Act of 1996) to 
     a family by reason of the birth of a child to a family member 
     otherwise eligible for such aid; and
       ``(ii) for so long as the State continues to implement such 
     policy under the State program funded under this part, under 
     rules prescribed by the State.
       ``(3) Reduction or elimination of assistance for 
     noncooperation in establishing paternity or obtaining child 
     support.--If the agency responsible for administering the 
     State plan approved under part D determines that an 
     individual is not cooperating with the State in establishing 
     paternity or in establishing, modifying, or enforcing a 
     support order with respect to a child of the individual, and 
     the individual does not qualify for any good cause or other 
     exception established by the State pursuant to section 
     454(29), then the State--
       ``(A) shall deduct from the assistance that would otherwise 
     be provided to the family of the individual under the State 
     program funded under this part the share of such assistance 
     attributable to the individual; and
       ``(B) may deny the family any assistance under the State 
     program.
       ``(4) No assistance for families not assigning certain 
     support rights to the state.--
       ``(A) In general.--A State to which a grant is made under 
     section 403 shall require, as a condition of providing 
     assistance to a family under the State program funded under 
     this part, that a member of the family assign to the State 
     any rights the family member may have (on behalf of the 
     family member or of any other person for whom the family 
     member has applied for or is receiving such assistance) to 
     support from any other person, not exceeding the total amount 
     of assistance so provided to the family, which accrue (or 
     have accrued) before the date the family leaves the program, 
     which assignment, on and after the date the family leaves the 
     program, shall not apply with respect to any support (other 
     than support collected pursuant to section 464) which accrued 
     before the family received such assistance and which the 
     State has not collected by--
       ``(i) September 30, 2000, if the assignment is executed on 
     or after October 1, 1997, and before October 1, 2000; or
       ``(ii) the date the family leaves the program, if the 
     assignment is executed on or after October 1, 2000.
       ``(B) Limitation.--A State to which a grant is made under 
     section 403 shall not require, as a condition of providing 
     assistance to any family under the State program funded under 
     this part, that a member of the family assign to the State 
     any rights to support described in subparagraph (A) which 
     accrue after the date the family leaves the program.
       ``(5) No assistance for teenage parents who do not attend 
     high school or other equivalent training program.--A State to 
     which a grant is made under section 403 shall not use any 
     part of the grant to provide assistance to an individual who 
     has not attained 18 years of age, is not married, has a minor 
     child at least 12 weeks of age in his or her care, and has 
     not successfully completed a high-school education (or its 
     equivalent), if the individual does not participate in--

[[Page H7850]]

       ``(A) educational activities directed toward the attainment 
     of a high school diploma or its equivalent; or
       ``(B) an alternative educational or training program that 
     has been approved by the State.
       ``(6) No assistance for teenage parents not living in 
     adult-supervised settings.--
       ``(A) In general.--
       ``(i) Requirement.--Except as provided in subparagraph (B), 
     a State to which a grant is made under section 403 shall not 
     use any part of the grant to provide assistance to an 
     individual described in clause (ii) of this subparagraph if 
     the individual and the minor child referred to in clause 
     (ii)(II) do not reside in a place of residence maintained by 
     a parent, legal guardian, or other adult relative of the 
     individual as such parent's, guardian's, or adult 
     relative's own home.
       ``(ii) Individual described.-- For purposes of clause (i), 
     an individual described in this clause is an individual who--

       ``(I) has not attained 18 years of age; and
       ``(II) is not married, and has a minor child in his or her 
     care.

       ``(B) Exception.--
       ``(i) Provision of, or assistance in locating, adult-
     supervised living arrangement.--In the case of an individual 
     who is described in clause (ii), the State agency referred to 
     in section 402(a)(4) shall provide, or assist the individual 
     in locating, a second chance home, maternity home, or other 
     appropriate adult-supervised supportive living arrangement, 
     taking into consideration the needs and concerns of the 
     individual, unless the State agency determines that the 
     individual's current living arrangement is appropriate, and 
     thereafter shall require that the individual and the minor 
     child referred to in subparagraph (A)(ii)(II) reside in such 
     living arrangement as a condition of the continued receipt of 
     assistance under the State program funded under this part 
     attributable to funds provided by the Federal Government (or 
     in an alternative appropriate arrangement, should 
     circumstances change and the current arrangement cease to be 
     appropriate).
       ``(ii) Individual described.--For purposes of clause (i), 
     an individual is described in this clause if the individual 
     is described in subparagraph (A)(ii), and--

       ``(I) the individual has no parent, legal guardian or other 
     appropriate adult relative described in subclause (II) of his 
     or her own who is living or whose whereabouts are known;
       ``(II) no living parent, legal guardian, or other 
     appropriate adult relative, who would otherwise meet 
     applicable State criteria to act as the individual's legal 
     guardian, of such individual allows the individual to live in 
     the home of such parent, guardian, or relative;
       ``(III) the State agency determines that--

       ``(aa) the individual or the minor child referred to in 
     subparagraph (A)(ii)(II) is being or has been subjected to 
     serious physical or emotional harm, sexual abuse, or 
     exploitation in the residence of the individual's own parent 
     or legal guardian; or
       ``(bb) substantial evidence exists of an act or failure to 
     act that presents an imminent or serious harm if the 
     individual and the minor child lived in the same residence 
     with the individual's own parent or legal guardian; or

       ``(IV) the State agency otherwise determines that it is in 
     the best interest of the minor child to waive the requirement 
     of subparagraph (A) with respect to the individual or the 
     minor child.

       ``(iii) Second-chance home.--For purposes of this 
     subparagraph, the term `second-chance home' means an entity 
     that provides individuals described in clause (ii) with a 
     supportive and supervised living arrangement in which such 
     individuals are required to learn parenting skills, including 
     child development, family budgeting, health and nutrition, 
     and other skills to promote their long-term economic 
     independence and the well-being of their children.
       ``(7) No medical services.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     a State to which a grant is made under section 403 shall not 
     use any part of the grant to provide medical services.
       ``(B) Exception for family planning services.--As used in 
     subparagraph (A), the term `medical services' does not 
     include family planning services.
       ``(8) No assistance for more than 5 years.--
       ``(A) In general.--Except as provided in subparagraphs (B) 
     and (C), a State to which a grant is made under section 403 
     shall not use any part of the grant to provide assistance to 
     a family that includes an adult who has received assistance 
     under any State program funded under this part attributable 
     to funds provided by the Federal Government, for 60 months 
     (whether or not consecutive) after the date the State program 
     funded under this part commences.
       ``(B) Minor child exception.--In determining the number of 
     months for which an individual who is a parent or pregnant 
     has received assistance under the State program funded under 
     this part, the State shall disregard any month for which such 
     assistance was provided with respect to the individual and 
     during which the individual was--
       ``(i) a minor child; and
       ``(ii) not the head of a household or married to the head 
     of a household.
       ``(C) Hardship exception.--
       ``(i) In general.--The State may exempt a family from the 
     application of subparagraph (A) by reason of hardship or if 
     the family includes an individual who has been battered or 
     subjected to extreme cruelty.
       ``(ii) Limitation.--The number of families with respect to 
     which an exemption made by a State under clause (i) is in 
     effect for a fiscal year shall not exceed 20 percent of the 
     average monthly number of families to which assistance is 
     provided under the State program funded under this part.
       ``(iii) Battered or subject to extreme cruelty defined.--
     For purposes of clause (i), an individual has been battered 
     or subjected to extreme cruelty if the individual has been 
     subjected to--

       ``(I) physical acts that resulted in, or threatened to 
     result in, physical injury to the individual;
       ``(II) sexual abuse;
       ``(III) sexual activity involving a dependent child;
       ``(IV) being forced as the caretaker relative of a 
     dependent child to engage in nonconsensual sexual acts or 
     activities;
       ``(V) threats of, or attempts at, physical or sexual abuse;
       ``(VI) mental abuse; or
       ``(VII) neglect or deprivation of medical care.

       ``(D) Rule of interpretation.--Subparagraph (A) shall not 
     be interpreted to require any State to provide assistance to 
     any individual for any period of time under the State program 
     funded under this part.
       ``(9) Denial of assistance for 10 years to a person found 
     to have fraudulently misrepresented residence in order to 
     obtain assistance in 2 or more states.--A State to which a 
     grant is made under section 403 shall not use any part of the 
     grant to provide cash assistance to an individual during the 
     10-year period that begins on the date the individual is 
     convicted in Federal or State court of having made a 
     fraudulent statement or representation with respect to the 
     place of residence of the individual in order to receive 
     assistance simultaneously from 2 or more States under 
     programs that are funded under this title, title XIX, or the 
     Food Stamp Act of 1977, or benefits in 2 or more States under 
     the supplemental security income program under title XVI. The 
     preceding sentence shall not apply with respect to a 
     conviction of an individual, for any month beginning after 
     the President of the United States grants a pardon with 
     respect to the conduct which was the subject of the 
     conviction.
       ``(10) Denial of assistance for fugitive felons and 
     probation and parole violators.--
       ``(A) In general.--A State to which a grant is made under 
     section 403 shall not use any part of the grant to provide 
     assistance to any individual who is--
       ``(i) fleeing to avoid prosecution, or custody or 
     confinement after conviction, under the laws of the place 
     from which the individual flees, for a crime, or an attempt 
     to commit a crime, which is a felony under the laws of the 
     place from which the individual flees, or which, in the case 
     of the State of New Jersey, is a high misdemeanor under the 
     laws of such State; or
       ``(ii) violating a condition of probation or parole imposed 
     under Federal or State law.

     The preceding sentence shall not apply with respect to 
     conduct of an individual, for any month beginning after the 
     President of the United States grants a pardon with respect 
     to the conduct.
       ``(B) Exchange of information with law enforcement 
     agencies.--If a State to which a grant is made under section 
     403 establishes safeguards against the use or disclosure of 
     information about applicants or recipients of assistance 
     under the State program funded under this part, the 
     safeguards shall not prevent the State agency administering 
     the program from furnishing a Federal, State, or local law 
     enforcement officer, upon the request of the officer, with 
     the current address of any recipient if the officer furnishes 
     the agency with the name of the recipient and notifies the 
     agency that--
       ``(i) the recipient--

       ``(I) is described in subparagraph (A); or
       ``(II) has information that is necessary for the officer to 
     conduct the official duties of the officer; and

       ``(ii) the location or apprehension of the recipient is 
     within such official duties.
       ``(11) Denial of assistance for minor children who are 
     absent from the home for a significant period.--
       ``(A) In general.--A State to which a grant is made under 
     section 403 shall not use any part of the grant to provide 
     assistance for a minor child who has been, or is expected by 
     a parent (or other caretaker relative) of the child to be, 
     absent from the home for a period of 45 consecutive days or, 
     at the option of the State, such period of not less than 30 
     and not more than 180 consecutive days as the State may 
     provide for in the State plan submitted pursuant to section 
     402.
       ``(B) State authority to establish good cause exceptions.--
     The State may establish such good cause exceptions to 
     subparagraph (A) as the State considers appropriate if such 
     exceptions are provided for in the State plan submitted 
     pursuant to section 402.
       ``(C) Denial of assistance for relative who fails to notify 
     state agency of absence of child.--A State to which a grant 
     is made under section 403 shall not use any part of the grant 
     to provide assistance for an individual who is a parent (or 
     other caretaker relative) of a minor child and who fails to 
     notify the agency administering the State program funded 
     under this part of the absence of the minor child from the 
     home for

[[Page H7851]]

     the period specified in or provided for pursuant to 
     subparagraph (A), by the end of the 5-day period that begins 
     with the date that it becomes clear to the parent (or 
     relative) that the minor child will be absent for such period 
     so specified or provided for.
       ``(12) Income security payments not to be disregarded in 
     determining the amount of assistance to be provided to a 
     family.--If a State to which a grant is made under section 
     403 uses any part of the grant to provide assistance for any 
     individual who is receiving benefits, or on behalf of whom 
     benefits are paid, under a State plan for old-age assistance 
     approved under section 2, under section 202, 205(j)(1), 223, 
     or 228, under a State program funded under part E that 
     provides cash payments for foster care, or under the 
     supplemental security income program under title XVI, then 
     the State may disregard the payment in determining the amount 
     of assistance to be provided under the State program funded 
     under this part, from funds provided by the Federal 
     Government, to the family of which the individual is a 
     member.
       ``(13) Medical assistance required to be provided for 1 
     year for families becoming ineligible for cash assistance 
     under this part due to increased earnings from employment.--A 
     State to which a grant is made under section 403 shall take 
     such action as may be necessary to ensure that, if an 
     individual or family becomes ineligible to receive cash 
     assistance under the State program funded under this part as 
     a result of increased earnings from employment, having 
     received such assistance in at least 3 of the 6 months 
     immediately preceding the month in which such ineligibility 
     begins, the individual (or in the case of a family, each 
     individual in the family) shall be eligible for medical 
     assistance under the State's plan approved under title XIX 
     during the immediately succeeding 12-month period for so long 
     as family income (as defined by the State), excluding any 
     refund of Federal income taxes made by reason of section 32 
     of the Internal Revenue Code of 1986 (relating to earned 
     income tax credit) and any payment made by an employer under 
     section 3507 of such Code (relating to advance payment of 
     earned income credit), is less than the poverty line, and 
     that the family will be appropriately notified of such 
     eligibility.
       ``(14) Medical assistance required to be provided for 4 
     months for families becoming ineligible for cash assistance 
     under this part due to collection of child support.--A State 
     to which a grant is made under section 403 shall take such 
     action as may be necessary to ensure that, if any individual 
     or family becomes ineligible to receive cash assistance under 
     the State program funded under this part as a result of the 
     collection or increased collection of child or spousal 
     support under part D, having received such assistance in at 
     least 3 of the 6 months immediately preceding the month in 
     which such ineligibility begins, the individual (or, in the 
     case of a family, each individual in the family) shall be 
     eligible for medical assistance under the State's plan 
     approved under title XIX during the 4-month period beginning 
     with the month in which such ineligibility begins.
       ``(15) Medical assistance required to be provided for 
     certain individuals.--A State to which a grant is made under 
     section 403 shall take such action as may be necessary to 
     ensure that, under section 1931, individuals who would be 
     eligible for cash assistance under the State plan approved 
     under this part (as in effect as of July 16, 1996) if such 
     State plan were still in effect are eligible for medical 
     assistance under the State's plan approved under title XIX.
       ``(b) Individual Responsibility Plans.--
       ``(1) Assessment.--The State agency responsible for 
     administering the State program funded under this part shall 
     make an initial assessment of the skills, prior work 
     experience, and employability of each recipient of assistance 
     under the program who--
       ``(A) has attained 18 years of age; or
       ``(B) has not completed high school or obtained a 
     certificate of high school equivalency, and is not attending 
     secondary school.
       ``(2) Contents of plans.--
       ``(A) In general.--On the basis of the assessment made 
     under subsection (a) with respect to an individual, the State 
     agency, in consultation with the individual, may develop an 
     individual responsibility plan for the individual, which--
       ``(i) sets forth an employment goal for the individual and 
     a plan for moving the individual immediately into private 
     sector employment;
       ``(ii) sets forth the obligations of the individual, which 
     may include a requirement that the individual attend school, 
     maintain certain grades and attendance, keep school age 
     children of the individual in school, immunize children, 
     attend parenting and money management classes, or do other 
     things that will help the individual become and remain 
     employed in the private sector;
       ``(iii) to the greatest extent possible is designed to move 
     the individual into whatever private sector employment the 
     individual is capable of handling as quickly as possible, and 
     to increase the responsibility and amount of work the 
     individual is to handle over time;
       ``(iv) describes the services the State will provide the 
     individual so that the individual will be able to obtain and 
     keep employment in the private sector, and describe the job 
     counseling and other services that will be provided by the 
     State; and
       ``(v) may require the individual to undergo appropriate 
     substance abuse treatment.
       ``(B) Timing.--The State agency may comply with paragraph 
     (1) with respect to an individual--
       ``(i) within 90 days (or, at the option of the State, 180 
     days) after the effective date of this part, in the case of 
     an individual who, as of such effective date, is a recipient 
     of aid under the State plan approved under part A (as in 
     effect immediately before such effective date); or
       ``(ii) within 30 days (or, at the option of the State, 90 
     days) after the individual is determined to be eligible for 
     such assistance, in the case of any other individual.
       ``(3) Penalty for noncompliance by individual.--In addition 
     to any other penalties required under the State program 
     funded under this part, the State may reduce, by such amount 
     as the State considers appropriate, the amount of assistance 
     otherwise payable under the State program to a family that 
     includes an individual who fails without good cause to comply 
     with an individual responsibility plan signed by the 
     individual.
       ``(4) State discretion.--The exercise of the authority of 
     this subsection shall be within the sole discretion of the 
     State.
       ``(c) Aliens.--For special rules relating to the treatment 
     of aliens, see section 4402 of the Personal Responsibility 
     and Work Opportunity Act of 1996.

     ``SEC. 409. PENALTIES.

       ``(a) In General.--Subject to this section:
       ``(1) Use of grant in violation of this part.--
       ``(A) General penalty.--If an audit conducted under chapter 
     75 of title 31, United States Code, finds that an amount paid 
     to a State under section 403 for a fiscal year has been used 
     in violation of this part, the Secretary shall reduce the 
     grant payable to the State under section 403(a)(1) for the 
     immediately succeeding fiscal year quarter by the amount so 
     used.
       ``(B) Enhanced penalty for intentional violations.--If the 
     State does not prove to the satisfaction of the Secretary 
     that the State did not intend to use the amount in violation 
     of this part, the Secretary shall further reduce the grant 
     payable to the State under section 403(a)(1) for the 
     immediately succeeding fiscal year quarter by an amount 
     equal to 5 percent of the State family assistance grant.
       ``(2) Failure to submit required report.--
       ``(A) In general.--If the Secretary determines that a State 
     has not, within 1 month after the end of a fiscal quarter, 
     submitted the report required by section 411(a) for the 
     quarter, the Secretary shall reduce the grant payable to the 
     State under section 403(a)(1) for the immediately succeeding 
     fiscal year by an amount equal to 4 percent of the State 
     family assistance grant.
       ``(B) Rescission of penalty.--The Secretary shall rescind a 
     penalty imposed on a State under subparagraph (A) with 
     respect to a report if the State submits the report before 
     the end of the fiscal quarter that immediately succeeds the 
     fiscal quarter for which the report was required.
       ``(3) Failure to satisfy minimum participation rates.--
       ``(A) In general.--If the Secretary determines that a State 
     to which a grant is made under section 403 for a fiscal year 
     has failed to comply with section 407(a) for the fiscal year, 
     the Secretary shall reduce the grant payable to the State 
     under section 403(a)(1) for the immediately succeeding fiscal 
     year by an amount equal to not more than 5 percent of the 
     State family assistance grant.
       ``(B) Penalty based on severity of failure.--The Secretary 
     shall impose reductions under subparagraph (A) based on the 
     degree of noncompliance, and may reduce the penalty if the 
     State experiences an economic downturn that leads to 
     significantly greater unemployment.
       ``(4) Failure to participate in the income and eligibility 
     verification system.--If the Secretary determines that a 
     State program funded under this part is not participating 
     during a fiscal year in the income and eligibility 
     verification system required by section 1137, the Secretary 
     shall reduce the grant payable to the State under section 
     403(a)(1) for the immediately succeeding fiscal year by an 
     amount equal to not more than 2 percent of the State family 
     assistance grant.
       ``(5) Failure to comply with paternity establishment and 
     child support enforcement requirements under part d.--
     Notwithstanding any other provision of this Act, if the 
     Secretary determines that the State agency that administers a 
     program funded under this part does not enforce the penalties 
     requested by the agency administering part D against 
     recipients of assistance under the State program who fail to 
     cooperate in establishing paternity or in establishing, 
     modifying, or enforcing a child support order in accordance 
     with such part and who do not qualify for any good cause or 
     other exception established by the State under section 
     454(29), the Secretary shall reduce the grant payable to the 
     State under section 403(a)(1) for the immediately succeeding 
     fiscal year (without regard to this section) by not more than 
     5 percent.
       ``(6) Failure to timely repay a federal loan fund for state 
     welfare programs.--If the Secretary determines that a State 
     has failed to repay any amount borrowed from the Federal Loan 
     Fund for State Welfare Programs established under section 406 
     within the period of maturity applicable to the loan, plus 
     any interest owed on the loan, the Secretary shall reduce the 
     grant payable to

[[Page H7852]]

     the State under section 403(a)(1) for the immediately 
     succeeding fiscal year quarter (without regard to this 
     section) by the outstanding loan amount, plus the interest 
     owed on the outstanding amount. The Secretary shall not 
     forgive any outstanding loan amount or interest owed on the 
     outstanding amount.
       ``(7) Failure of any state to maintain certain level of 
     historic effort.--
       ``(A) In general.--The Secretary shall reduce the grant 
     payable to the State under section 403(a)(1) for fiscal year 
     1998, 1999, 2000, 2001, or 2002 by the amount (if any) by 
     which qualified State expenditures for the then immediately 
     preceding fiscal year are less than the applicable percentage 
     of historic State expenditures with respect to such preceding 
     fiscal year.
       ``(B) Definitions.--As used in this paragraph:
       ``(i) Qualified state expenditures.--

       ``(I) In general.--The term `qualified State expenditures' 
     means, with respect to a State and a fiscal year, the total 
     expenditures by the State during the fiscal year, under all 
     State programs, for any of the following with respect to 
     eligible families:

       ``(aa) Cash assistance.
       ``(bb) Child care assistance.
       ``(cc) Educational activities designed to increase self-
     sufficiency, job training, and work, excluding any 
     expenditure for public education in the State except 
     expenditures which involve the provision of services or 
     assistance to a member of an eligible family which is not 
     generally available to persons who are not members of an 
     eligible family.
       ``(dd) Administrative costs in connection with the matters 
     described in items (aa), (bb), (cc), and (ee), but only to 
     the extent that such costs do not exceed 15 percent of the 
     total amount of qualified State expenditures for the fiscal 
     year.
       ``(ee) Any other use of funds allowable under section 
     404(a)(1).

       ``(II) Exclusion of transfers from other state and local 
     programs.--Such term does not include expenditures under any 
     State or local program during a fiscal year, except to the 
     extent that--

       ``(aa) the expenditures exceed the amount expended under 
     the State or local program in the fiscal year most recently 
     ending before the date of the enactment of this part; or
       ``(bb) the State is entitled to a payment under former 
     section 403 (as in effect immediately before such date of 
     enactment) with respect to the expenditures.

       ``(III) Eligible families.--As used in subclause (I), the 
     term `eligible families' means families eligible for 
     assistance under the State program funded under this part, 
     and families that would be eligible for such assistance but 
     for the application of section 408(a)(8) of this Act or 
     section 4402 of the Personal Responsibility and Work 
     Opportunity Act of 1996.

       ``(ii) Applicable percentage.--The term `applicable 
     percentage' means for fiscal years 1997 through 2001, 75 
     percent reduced (if appropriate) in accordance with 
     subparagraph (C)(ii).
       ``(iii) Historic state expenditures.--The term `historic 
     State expenditures' means, with respect to a State, the 
     lesser of--

       ``(I) the expenditures by the State under parts A and F (as 
     in effect during fiscal year 1994) for fiscal year 1994; or
       ``(II) the amount which bears the same ratio to the amount 
     described in subclause (I) as--

       ``(aa) the State family assistance grant, plus the total 
     amount required to be paid to the State under former section 
     403 for fiscal year 1994 with respect to amounts expended by 
     the State for child care under subsection (g) or (i) of 
     section 402 (as in effect during fiscal year 1994); bears 
     to
       ``(bb) the total amount required to be paid to the State 
     under former section 403 (as in effect during fiscal year 
     1994) for fiscal year 1994.

     Such term does not include any expenditures under the State 
     plan approved under part A (as so in effect) on behalf of 
     individuals covered by a tribal family assistance plan 
     approved under section 412, as determined by the Secretary.
       ``(iv) Expenditures by the state.--The term `expenditures 
     by the State' does not include--

       ``(I) any expenditures from amounts made available by the 
     Federal Government;
       ``(II) State funds expended for the medicaid program under 
     title XIX; or
       ``(III) any State funds which are used to match Federal 
     funds or are expended as a condition of receiving Federal 
     funds under Federal programs other than under this part.

       ``(C) Applicable percentage reduced for high performance 
     states.--
       ``(i) Determination of high performance states.--The 
     Secretary shall use the formula developed under section 
     403(a)(4)(C) to assign a score to each eligible State that 
     represents the performance of the State program funded under 
     this part for each fiscal year, and shall prescribe a 
     performance threshold which the Secretary shall use to 
     determine whether to reduce the applicable percentage with 
     respect to any eligible State for a fiscal year.
       ``(ii) Reduction proportional to performance.--The 
     Secretary shall reduce the applicable percentage for a fiscal 
     year with respect to each eligible State by an amount which 
     is directly proportional to the amount (if any) by which the 
     score assigned to the State under clause (i) for the 
     immediately preceding fiscal year exceeds the performance 
     threshold prescribed under clause (i) for such preceding 
     fiscal year, subject to clause (iii).
       ``(iii) Limitation on reduction.--The applicable percentage 
     for a fiscal year with respect to a State may not be reduced 
     by more than 8 percentage points under this subparagraph.
       ``(8) Substantial noncompliance of state child support 
     enforcement program with requirements of part d.--
       ``(A) In general.--If a State program operated under part D 
     is found as a result of a review conducted under section 
     452(a)(4) not to have complied substantially with the 
     requirements of such part for any quarter, and the Secretary 
     determines that the program is not complying substantially 
     with such requirements at the time the finding is made, the 
     Secretary shall reduce the grant payable to the State under 
     section 403(a)(1) for the quarter and each subsequent quarter 
     that ends before the 1st quarter throughout which the program 
     is found to be in substantial compliance with such 
     requirements by--
       ``(i) not less than 1 nor more than 2 percent;
       ``(ii) not less than 2 nor more than 3 percent, if the 
     finding is the 2nd consecutive such finding made as a result 
     of such a review; or
       ``(iii) not less than 3 nor more than 5 percent, if the 
     finding is the 3rd or a subsequent consecutive such finding 
     made as a result of such a review.
       ``(B) Disregard of noncompliance which is of a technical 
     nature.--For purposes of subparagraph (A) and section 
     452(a)(4), a State which is not in full compliance with the 
     requirements of this part shall be determined to be in 
     substantial compliance with such requirements only if the 
     Secretary determines that any noncompliance with such 
     requirements is of a technical nature which does not 
     adversely affect the performance of the State's program 
     operated under part D.
       ``(9) Failure of state receiving amounts from contingency 
     fund to maintain 100 percent of historic effort.--If, at the 
     end of any fiscal year during which amounts from the 
     Contingency Fund for State Welfare Programs have been paid to 
     a State, the Secretary finds that the expenditures under the 
     State program funded under this part for the fiscal year are 
     less than 100 percent of historic State expenditures (as 
     defined in paragraph (8)(B)(iii) of this subsection), the 
     Secretary shall reduce the grant payable to the State under 
     section 403(a)(1) for the immediately succeeding fiscal year 
     by the total of the amounts so paid to the State.
       ``(10) Failure to expend additional state funds to replace 
     grant reductions.--If the grant payable to a State under 
     section 403(a)(1) for a fiscal year is reduced by reason of 
     this subsection, the State shall, during the immediately 
     succeeding fiscal year, expend under the State program funded 
     under this part an amount equal to the total amount of such 
     reductions.
       ``(11) Failure to provide medical assistance to families 
     becoming ineligible for cash assistance under this part due 
     to increased earnings from employment or collection of child 
     support.--
       ``(A) In general.--If the Secretary determines that a State 
     program funded under this part is not in compliance with 
     paragraph (13) or (14) of section 408(a) for a quarter, the 
     Secretary shall reduce the grant payable to the State under 
     section 403(a)(1) for the immediately succeeding fiscal year 
     by an amount equal to not more than 5 percent of the State 
     family assistance grant.
       ``(B) Penalty based on severity of failure.--The Secretary 
     shall impose reductions under subparagraph (A) based on the 
     degree of noncompliance.
       ``(b) Reasonable Cause Exception.--
       ``(1) In general.--The Secretary may not impose a penalty 
     on a State under subsection (a) with respect to a requirement 
     if the Secretary determines that the State has reasonable 
     cause for failing to comply with the requirement.
       ``(2) Exception.--Paragraph (1) of this subsection shall 
     not apply to any penalty under paragraph (7), (8), or (11) of 
     subsection (a).
       ``(c) Corrective Compliance Plan.--
       ``(1) In general.--
       ``(A) Notification of violation.--Before imposing a penalty 
     against a State under subsection (a) with respect to a 
     violation of this part, the Secretary shall notify the State 
     of the violation and allow the State the opportunity to enter 
     into a corrective compliance plan in accordance with this 
     subsection which outlines how the State will correct the 
     violation and how the State will insure continuing compliance 
     with this part.
       ``(B) 60-day period to propose a corrective compliance 
     plan.--During the 60-day period that begins on the date the 
     State receives a notice provided under subparagraph (A) with 
     respect to a violation, the State may submit to the Federal 
     Government a corrective compliance plan to correct the 
     violation.
       ``(C) Consultation about modifications.--During the 60-day 
     period that begins with the date the Secretary receives a 
     corrective compliance plan submitted by a State in accordance 
     with subparagraph (B), the Secretary may consult with the 
     State on modifications to the plan.
       ``(D) Acceptance of plan.-- A corrective compliance plan 
     submitted by a State in accordance with subparagraph (B) is 
     deemed to be accepted by the Secretary if the Secretary does 
     not accept or reject the plan during 60-

[[Page H7853]]

     day period that begins on the date the plan is submitted.
       ``(2) Effect of correcting violation.--The Secretary may 
     not impose any penalty under subsection (a) with respect to 
     any violation covered by a State corrective compliance plan 
     accepted by the Secretary if the State corrects the violation 
     pursuant to the plan.
       ``(3) Effect of failing to correct violation.--The 
     Secretary shall assess some or all of a penalty imposed on a 
     State under subsection (a) with respect to a violation if the 
     State does not, in a timely manner, correct the violation 
     pursuant to a State corrective compliance plan accepted by 
     the Secretary.
       ``(4) Inapplicability to failure to timely repay a federal 
     loan fund for a state welfare program.--This subsection shall 
     not apply to the imposition of a penalty against a State 
     under subsection (a)(6).
       ``(d) Limitation on Amount of Penalty.--
       ``(1) In general.--In imposing the penalties described in 
     subsection (a), the Secretary shall not reduce any quarterly 
     payment to a State by more than 25 percent.
       ``(2) Carryforward of unrecovered penalties.--To the extent 
     that paragraph (1) of this subsection prevents the Secretary 
     from recovering during a fiscal year the full amount of 
     penalties imposed on a State under subsection (a) of this 
     section for a prior fiscal year, the Secretary shall apply 
     any remaining amount of such penalties to the grant payable 
     to the State under section 403(a)(1) for the immediately 
     succeeding fiscal year.

     ``SEC. 410. APPEAL OF ADVERSE DECISION.

       ``(a) In General.--Within 5 days after the date the 
     Secretary takes any adverse action under this part with 
     respect to a State, the Secretary shall notify the chief 
     executive officer of the State of the adverse action, 
     including any action with respect to the State plan submitted 
     under section 402 or the imposition of a penalty under 
     section 409.
       ``(b) Administrative Review.--
       ``(1) In general.--Within 60 days after the date a State 
     receives notice under subsection (a) of an adverse action, 
     the State may appeal the action, in whole or in part, to the 
     Departmental Appeals Board established in the Department of 
     Health and Human Services (in this section referred to as the 
     `Board') by filing an appeal with the Board.
       ``(2) Procedural rules.--The Board shall consider an appeal 
     filed by a State under paragraph (1) on the basis of such 
     documentation as the State may submit and as the Board may 
     require to support the final decision of the Board. In 
     deciding whether to uphold an adverse action or any portion 
     of such an action, the Board shall conduct a thorough review 
     of the issues and take into account all relevant evidence. 
     The Board shall make a final determination with respect to an 
     appeal filed under paragraph (1) not less than 60 days after 
     the date the appeal is filed.
       ``(c) Judicial Review of Adverse Decision.--
       ``(1) In general.--Within 90 days after the date of a final 
     decision by the Board under this section with respect to an 
     adverse action taken against a State, the State may obtain 
     judicial review of the final decision (and the findings 
     incorporated into the final decision) by filing an action 
     in--
       ``(A) the district court of the United States for the 
     judicial district in which the principal or headquarters 
     office of the State agency is located; or
       ``(B) the United States District Court for the District of 
     Columbia.
       ``(2) Procedural rules.--The district court in which an 
     action is filed under paragraph (1) shall review the final 
     decision of the Board on the record established in the 
     administrative proceeding, in accordance with the standards 
     of review prescribed by subparagraphs (A) through (E) of 
     section 706(2) of title 5, United States Code. The review 
     shall be on the basis of the documents and supporting data 
     submitted to the Board.

     ``SEC. 411. DATA COLLECTION AND REPORTING.

       ``(a) Quarterly Reports by States.--
       ``(1) General reporting requirement.--
       ``(A) Contents of report.--Each eligible State shall 
     collect on a monthly basis, and report to the Secretary on a 
     quarterly basis, the following disaggregated case record 
     information on the families receiving assistance under the 
     State program funded under this part:
       ``(i) The county of residence of the family.
       ``(ii) Whether a child receiving such assistance or an 
     adult in the family is disabled.
       ``(iii) The ages of the members of such families.
       ``(iv) The number of individuals in the family, and the 
     relation of each family member to the youngest child in the 
     family.
       ``(v) The employment status and earnings of the employed 
     adult in the family.
       ``(vi) The marital status of the adults in the family, 
     including whether such adults have never married, are 
     widowed, or are divorced.
       ``(vii) The race and educational status of each adult in 
     the family.
       ``(viii) The race and educational status of each child in 
     the family.
       ``(ix) Whether the family received subsidized housing, 
     medical assistance under the State plan approved under title 
     XIX, food stamps, or subsidized child care, and if the latter 
     2, the amount received.
       ``(x) The number of months that the family has received 
     each type of assistance under the program.
       ``(xi) If the adults participated in, and the number of 
     hours per week of participation in, the following activities:

       ``(I) Education.
       ``(II) Subsidized private sector employment.
       ``(III) Unsubsidized employment.
       ``(IV) Public sector employment, work experience, or 
     community service.
       ``(V) Job search.
       ``(VI) Job skills training or on-the-job training.
       ``(VII) Vocational education.

       ``(xii) Information necessary to calculate participation 
     rates under section 407.
       ``(xiii) The type and amount of assistance received under 
     the program, including the amount of and reason for any 
     reduction of assistance (including sanctions).
       ``(xiv) Any amount of unearned income received by any 
     member of the family.
       ``(xv) The citizenship of the members of the family.
       ``(xvi) From a sample of closed cases, whether the family 
     left the program, and if so, whether the family left due to--

       ``(I) employment;
       ``(II) marriage;
       ``(III) the prohibition set forth in section 408(a)(8);
       ``(IV) sanction; or
       ``(V) State policy.

       ``(B) Use of estimates.--
       ``(i) Authority.--A State may comply with subparagraph (A) 
     by submitting an estimate which is obtained through the use 
     of scientifically acceptable sampling methods approved by the 
     Secretary.
       ``(ii) Sampling and other methods.--The Secretary shall 
     provide the States with such case sampling plans and data 
     collection procedures as the Secretary deems necessary to 
     produce statistically valid estimates of the performance of 
     State programs funded under this part. The Secretary may 
     develop and implement procedures for verifying the quality of 
     data submitted by the States.
       ``(2) Report on use of federal funds to cover 
     administrative costs and overhead.--The report required by 
     paragraph (1) for a fiscal quarter shall include a statement 
     of the percentage of the funds paid to the State under this 
     part for the quarter that are used to cover administrative 
     costs or overhead.
       ``(3) Report on state expenditures on programs for needy 
     families.--The report required by paragraph (1) for a fiscal 
     quarter shall include a statement of the total amount 
     expended by the State during the quarter on programs for 
     needy families.
       ``(4) Report on noncustodial parents participating in work 
     activities.--The report required by paragraph (1) for a 
     fiscal quarter shall include the number of noncustodial 
     parents in the State who participated in work activities (as 
     defined in section 407(d)) during the quarter.
       ``(5) Report on transitional services.--The report required 
     by paragraph (1) for a fiscal quarter shall include the total 
     amount expended by the State during the quarter to provide 
     transitional services to a family that has ceased to receive 
     assistance under this part because of employment, along with 
     a description of such services.
       ``(6) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary to define the data elements 
     with respect to which reports are required by this 
     subsection.
       ``(b) Annual Reports to the Congress by the Secretary.--Not 
     later than 6 months after the end of fiscal year 1997, and 
     each fiscal year thereafter, the Secretary shall transmit to 
     the Congress a report describing--
       ``(1) whether the States are meeting--
       ``(A) the participation rates described in section 407(a); 
     and
       ``(B) the objectives of--
       ``(i) increasing employment and earnings of needy families, 
     and child support collections; and
       ``(ii) decreasing out-of-wedlock pregnancies and child 
     poverty;
       ``(2) the demographic and financial characteristics of 
     families applying for assistance, families receiving 
     assistance, and families that become ineligible to receive 
     assistance;
       ``(3) the characteristics of each State program funded 
     under this part; and
       ``(4) the trends in employment and earnings of needy 
     families with minor children living at home.

     ``SEC. 412. DIRECT FUNDING AND ADMINISTRATION BY INDIAN 
                   TRIBES.

       ``(a) Grants for Indian Tribes.--
       ``(1) Tribal family assistance grant.--
       ``(A) In general.--For each of fiscal years 1997, 1998, 
     1999, and 2000, the Secretary shall pay to each Indian tribe 
     that has an approved tribal family assistance plan a tribal 
     family assistance grant for the fiscal year in an amount 
     equal to the amount determined under subparagraph (B), and 
     shall reduce the grant payable under section 403(a)(1) to any 
     State in which lies the service area or areas of the Indian 
     tribe by that portion of the amount so determined that is 
     attributable to expenditures by the State.
       ``(B) Amount determined.--
       ``(i) In general.--The amount determined under this 
     subparagraph is an amount equal to the total amount of the 
     Federal payments to a State or States under section 403 (as 
     in effect during such fiscal year) for fiscal year 1994 
     attributable to expenditures (other than child care 
     expenditures) by the State or States under parts A and F 
     (as so in effect) for fiscal year 1994 for Indian families 
     residing in the service area or areas identified by

[[Page H7854]]

     the Indian tribe pursuant to subsection (b)(1)(C) of this 
     section.
       ``(ii) Use of state submitted data.--

       ``(I) In general.--The Secretary shall use State submitted 
     data to make each determination under clause (i).
       ``(II) Disagreement with determination.--If an Indian tribe 
     or tribal organization disagrees with State submitted data 
     described under subclause (I), the Indian tribe or tribal 
     organization may submit to the Secretary such additional 
     information as may be relevant to making the determination 
     under clause (i) and the Secretary may consider such 
     information before making such determination.

       ``(2) Grants for indian tribes that received jobs funds.--
       ``(A) In general.--The Secretary shall pay to each eligible 
     Indian tribe for each of fiscal years 1996, 1997, 1998, 1999, 
     2000, and 2001 a grant in an amount equal to the amount 
     received by the Indian tribe in fiscal year 1994 under 
     section 482(i) (as in effect during fiscal year 1994).
       ``(B) Eligible indian tribe.--For purposes of subparagraph 
     (A), the term `eligible Indian tribe' means an Indian tribe 
     or Alaska Native organization that conducted a job 
     opportunities and basic skills training program in fiscal 
     year 1995 under section 482(i) (as in effect during fiscal 
     year 1995).
       ``(C) Use of grant.--Each Indian tribe to which a grant is 
     made under this paragraph shall use the grant for the purpose 
     of operating a program to make work activities available to 
     members of the Indian tribe.
       ``(D) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there are 
     appropriated $7,638,474 for each fiscal year specified in 
     subparagraph (A) for grants under subparagraph (A).
       ``(b) 3-Year Tribal Family Assistance Plan.--
       ``(1) In general.--Any Indian tribe that desires to receive 
     a tribal family assistance grant shall submit to the 
     Secretary a 3-year tribal family assistance plan that--
       ``(A) outlines the Indian tribe's approach to providing 
     welfare-related services for the 3-year period, consistent 
     with this section;
       ``(B) specifies whether the welfare-related services 
     provided under the plan will be provided by the Indian tribe 
     or through agreements, contracts, or compacts with 
     intertribal consortia, States, or other entities;
       ``(C) identifies the population and service area or areas 
     to be served by such plan;
       ``(D) provides that a family receiving assistance under the 
     plan may not receive duplicative assistance from other State 
     or tribal programs funded under this part;
       ``(E) identifies the employment opportunities in or near 
     the service area or areas of the Indian tribe and the manner 
     in which the Indian tribe will cooperate and participate in 
     enhancing such opportunities for recipients of assistance 
     under the plan consistent with any applicable State 
     standards; and
       ``(F) applies the fiscal accountability provisions of 
     section 5(f)(1) of the Indian Self-Determination and 
     Education Assistance Act (25 U.S.C. 450c(f)(1)), relating to 
     the submission of a single-agency audit report required by 
     chapter 75 of title 31, United States Code.
       ``(2) Approval.--The Secretary shall approve each tribal 
     family assistance plan submitted in accordance with paragraph 
     (1).
       ``(3) Consortium of tribes.--Nothing in this section shall 
     preclude the development and submission of a single tribal 
     family assistance plan by the participating Indian tribes of 
     an intertribal consortium.
       ``(c) Minimum Work Participation Requirements and Time 
     Limits.--The Secretary, with the participation of Indian 
     tribes, shall establish for each Indian tribe receiving a 
     grant under this section minimum work participation 
     requirements, appropriate time limits for receipt of welfare-
     related services under the grant, and penalties against 
     individuals--
       ``(1) consistent with the purposes of this section;
       ``(2) consistent with the economic conditions and resources 
     available to each tribe; and
       ``(3) similar to comparable provisions in section 407(d).
       ``(d) Emergency Assistance.--Nothing in this section shall 
     preclude an Indian tribe from seeking emergency assistance 
     from any Federal loan program or emergency fund.
       ``(e) Accountability.--Nothing in this section shall be 
     construed to limit the ability of the Secretary to maintain 
     program funding accountability consistent with--
       ``(1) generally accepted accounting principles; and
       ``(2) the requirements of the Indian Self-Determination and 
     Education Assistance Act (25 U.S.C. 450 et seq.).
       ``(f) Penalties.--
       ``(1) Subsections (a)(1), (a)(6), and (b) of section 409, 
     shall apply to an Indian tribe with an approved tribal 
     assistance plan in the same manner as such subsections apply 
     to a State.
       ``(2) Section 409(a)(3) shall apply to an Indian tribe with 
     an approved tribal assistance plan by substituting `meet 
     minimum work participation requirements established under 
     section 412(c)' for `comply with section 407(a)'.
       ``(g) Data Collection and Reporting.--Section 411 shall 
     apply to an Indian tribe with an approved tribal family 
     assistance plan.
       ``(h) Special Rule for Indian Tribes in Alaska.--
       ``(1) In general.--Notwithstanding any other provision of 
     this section, and except as provided in paragraph (2), an 
     Indian tribe in the State of Alaska that receives a tribal 
     family assistance grant under this section shall use the 
     grant to operate a program in accordance with requirements 
     comparable to the requirements applicable to the program of 
     the State of Alaska funded under this part. Comparability of 
     programs shall be established on the basis of program 
     criteria developed by the Secretary in consultation with the 
     State of Alaska and such Indian tribes.
       ``(2) Waiver.--An Indian tribe described in paragraph (1) 
     may apply to the appropriate State authority to receive a 
     waiver of the requirement of paragraph (1).

     ``SEC. 413. RESEARCH, EVALUATIONS, AND NATIONAL STUDIES.

       ``(a) Research.--The Secretary shall conduct research on 
     the benefits, effects, and costs of operating different State 
     programs funded under this part, including time limits 
     relating to eligibility for assistance. The research shall 
     include studies on the effects of different programs and the 
     operation of such programs on welfare dependency, 
     illegitimacy, teen pregnancy, employment rates, child well-
     being, and any other area the Secretary deems appropriate. 
     The Secretary shall also conduct research on the costs and 
     benefits of State activities under section 409.
       ``(b) Development and Evaluation of Innovative Approaches 
     To Reducing Welfare Dependency and Increasing Child Well-
     Being.--
       ``(1) In general.--The Secretary may assist States in 
     developing, and shall evaluate, innovative approaches for 
     reducing welfare dependency and increasing the well-being of 
     minor children living at home with respect to recipients of 
     assistance under programs funded under this part. 
     The Secretary may provide funds for training and technical 
     assistance to carry out the approaches developed pursuant 
     to this paragraph.
       ``(2) Evaluations.--In performing the evaluations under 
     paragraph (1), the Secretary shall, to the maximum extent 
     feasible, use random assignment as an evaluation methodology.
       ``(c) Dissemination of Information.--The Secretary shall 
     develop innovative methods of disseminating information on 
     any research, evaluations, and studies conducted under this 
     section, including the facilitation of the sharing of 
     information and best practices among States and localities 
     through the use of computers and other technologies.
       ``(d) Annual Ranking of States and Review of Most and Least 
     Successful Work Programs.--
       ``(1) Annual ranking of states.--The Secretary shall rank 
     annually the States to which grants are paid under section 
     403 in the order of their success in placing recipients of 
     assistance under the State program funded under this part 
     into long-term private sector jobs, reducing the overall 
     welfare caseload, and, when a practicable method for 
     calculating this information becomes available, diverting 
     individuals from formally applying to the State program and 
     receiving assistance. In ranking States under this 
     subsection, the Secretary shall take into account the average 
     number of minor children living at home in families in the 
     State that have incomes below the poverty line and the amount 
     of funding provided each State for such families.
       ``(2) Annual review of most and least successful work 
     programs.--The Secretary shall review the programs of the 3 
     States most recently ranked highest under paragraph (1) and 
     the 3 States most recently ranked lowest under paragraph (1) 
     that provide parents with work experience, assistance in 
     finding employment, and other work preparation activities and 
     support services to enable the families of such parents to 
     leave the program and become self-sufficient.
       ``(e) Annual Ranking of States and Review of Issues 
     Relating to Out-of-Wedlock Births.--
       ``(1) Annual ranking of states.--
       ``(A) In general.--The Secretary shall annually rank States 
     to which grants are made under section 403 based on the 
     following ranking factors:
       ``(i) Absolute out-of-wedlock ratios.--The ratio 
     represented by--

       ``(I) the total number of out-of-wedlock births in families 
     receiving assistance under the State program under this part 
     in the State for the most recent fiscal year for which 
     information is available; over
       ``(II) the total number of births in families receiving 
     assistance under the State program under this part in the 
     State for such year.

       ``(ii) Net changes in the out-of-wedlock ratio.--The 
     difference between the ratio described in subparagraph (A)(i) 
     with respect to a State for the most recent fiscal year for 
     which such information is available and the ratio with 
     respect to the State for the immediately preceding year.
       ``(2) Annual review.--The Secretary shall review the 
     programs of the 5 States most recently ranked highest under 
     paragraph (1) and the 5 States most recently ranked the 
     lowest under paragraph (1).
       ``(f) State-Initiated Evaluations.--A State shall be 
     eligible to receive funding to evaluate the State program 
     funded under this part if--
       ``(1) the State submits a proposal to the Secretary for the 
     evaluation;
       ``(2) the Secretary determines that the design and approach 
     of the evaluation is rigorous and is likely to yield 
     information that is

[[Page H7855]]

     credible and will be useful to other States, and
       ``(3) unless otherwise waived by the Secretary, the State 
     contributes to the cost of the evaluation, from non-Federal 
     sources, an amount equal to at least 10 percent of the 
     cost of the evaluation.
       ``(g) Report on Circumstances of Certain Children and 
     Families.--
       ``(1) In general.--Beginning 3 years after the date of the 
     enactment of this Act, the Secretary of Health and Human 
     Services shall prepare and submit to the Committees on Ways 
     and Means and on Economic and Educational Opportunities of 
     the House of Representatives and to the Committees on Finance 
     and on Labor and Resources of the Senate annual reports that 
     examine in detail the matters described in paragraph (2) with 
     respect to each of the following groups for the period after 
     such enactment:
       ``(A) Individuals who were children in families that have 
     become ineligible for assistance under a State program funded 
     under this part by reason of having reached a time limit on 
     the provision of such assistance.
       ``(B) Families that include a child who is ineligible for 
     assistance under a State program funded under this part by 
     reason of section 408(a)(2).
       ``(C) Children born after such date of enactment to parents 
     who, at the time of such birth, had not attained 20 years of 
     age.
       ``(D) Individuals who, after such date of enactment, became 
     parents before attaining 20 years of age.
       ``(2) Matters described.--The matters described in this 
     paragraph are the following:
       ``(A) The percentage of each group that has dropped out of 
     secondary school (or the equivalent), and the percentage of 
     each group at each level of educational attainment.
       ``(B) The percentage of each group that is employed.
       ``(C) The percentage of each group that has been convicted 
     of a crime or has been adjudicated as a delinquent.
       ``(D) The rate at which the members of each group are born, 
     or have children, out-of-wedlock, and the percentage of each 
     group that is married.
       ``(E) The percentage of each group that continues to 
     participate in State programs funded under this part.
       ``(F) The percentage of each group that has health 
     insurance provided by a private entity (broken down by 
     whether the insurance is provided through an employer or 
     otherwise), the percentage that has health insurance provided 
     by an agency of government, and the percentage that does not 
     have health insurance.
       ``(G) The average income of the families of the members of 
     each group.
       ``(H) Such other matters as the Secretary deems 
     appropriate.
       ``(h) Funding of Studies and Demonstrations.--
       ``(1) In general.--Out of any money in the Treasury of the 
     United States not otherwise appropriated, there are 
     appropriated $15,000,000 for each fiscal year specified in 
     section 403(a)(1) for the purpose of paying--
       ``(A) the cost of conducting the research described in 
     subsection (a);
       ``(B) the cost of developing and evaluating innovative 
     approaches for reducing welfare dependency and increasing the 
     well-being of minor children under subsection (b);
       ``(C) the Federal share of any State-initiated study 
     approved under subsection (f); and
       ``(D) an amount determined by the Secretary to be necessary 
     to operate and evaluate demonstration projects, relating to 
     this part, that are in effect or approved under section 1115 
     as of September 30, 1995, and are continued after such date.
       ``(2) Allocation.--Of the amount appropriated under 
     paragraph (1) for a fiscal year--
       ``(A) 50 percent shall be allocated for the purposes 
     described in subparagraphs (A) and (B) of paragraph (1), and
       ``(B) 50 percent shall be allocated for the purposes 
     described in subparagraphs (C) and (D) of paragraph (1).
       ``(3) Demonstrations of innovative strategies.--The 
     Secretary may implement and evaluate demonstrations of 
     innovative and promising strategies which--
       ``(A) provide one-time capital funds to establish, expand, 
     or replicate programs;
       ``(B) test performance-based grant-to-loan financing in 
     which programs meeting performance targets receive grants 
     while programs not meeting such targets repay funding on a 
     prorated basis; and
       ``(C) test strategies in multiple States and types of 
     communities.

     ``SEC. 414. STUDY BY THE CENSUS BUREAU.

       ``(a) In General.--The Bureau of the Census shall expand 
     the Survey of Income and Program Participation as necessary 
     to obtain such information as will enable interested persons 
     to evaluate the impact of the amendments made by subtitle A 
     of the Personal Responsibility and Work Opportunity Act of 
     1996 on a random national sample of recipients of assistance 
     under State programs funded under this part and (as 
     appropriate) other low income families, and in doing so, 
     shall pay particular attention to the issues of out-of-
     wedlock birth, welfare dependency, the beginning and end of 
     welfare spells, and the causes of repeat welfare spells.
       ``(b) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there are 
     appropriated $10,000,000 for each of fiscal years 1996, 1997, 
     1998, 1999, 2000, 2001, and 2002 for payment to the Bureau of 
     the Census to carry out subsection (a).

     ``SEC. 415. WAIVERS.

       ``(a) Continuation of Waivers.--
       ``(1) Waivers in effect on date of enactment of welfare 
     reform.--Except as provided in paragraph (3), if any waiver 
     granted to a State under section 1115 or otherwise which 
     relates to the provision of assistance under a State plan 
     under this part (as in effect on September 30, 1995) is in 
     effect as of the date of the enactment of the Personal 
     Responsibility and Work Opportunity Act of 1996, the 
     amendments made by such Act (other than by section 4103(d) of 
     such Act) shall not apply with respect to the State before 
     the expiration (determined without regard to any extensions) 
     of the waiver to the extent such amendments are inconsistent 
     with the waiver.
       ``(2) Waivers granted subsequently.--Except as provided in 
     paragraph (3), if any waiver granted to a State under section 
     1115 or otherwise which relates to the provision of 
     assistance under a State plan under this part (as in effect 
     on September 30, 1995) is submitted to the Secretary before 
     the date of the enactment of the Personal Responsibility and 
     Work Opportunity Act of 1996 and approved by the Secretary on 
     or before July 1, 1997, and the State demonstrates to the 
     satisfaction of the Secretary that the waiver will not result 
     in Federal expenditures under title IV of this Act (as in 
     effect without regard to the amendments made by the Personal 
     Responsibility and Work Opportunity Act of 1996) that are 
     greater than would occur in the absence of the waiver, the 
     amendments made by the Personal Responsibility and Work 
     Opportunity Act of 1996 (other than by section 4103(d) of 
     such Act) shall not apply with respect to the State before 
     the expiration (determined without regard to any extensions) 
     of the waiver to the extent the amendments made by the 
     Personal Responsibility and Work Opportunity Act of 1996 are 
     inconsistent with the waiver.
       ``(3) Financing limitation.--Notwithstanding any other 
     provision of law, beginning with fiscal year 1996, a State 
     operating under a waiver described in paragraph (1) shall be 
     entitled to payment under section 403 for the fiscal year, in 
     lieu of any other payment provided for in the waiver.
       ``(b) State Option To Terminate Waiver.--
       ``(1) In general.--A State may terminate a waiver described 
     in subsection (a) before the expiration of the waiver.
       ``(2) Report.--A State which terminates a waiver under 
     paragraph (1) shall submit a report to the Secretary 
     summarizing the waiver and any available information 
     concerning the result or effect of the waiver.
       ``(3) Hold harmless provision.--
       ``(A) In general.--Notwithstanding any other provision of 
     law, a State that, not later than the date described in 
     subparagraph (B), submits a written request to terminate a 
     waiver described in subsection (a) shall be held harmless for 
     accrued cost neutrality liabilities incurred under the 
     waiver.
       ``(B) Date described.--The date described in this 
     subparagraph is 90 days following the adjournment of the 
     first regular session of the State legislature that begins 
     after the date of the enactment of the Personal 
     Responsibility and Work Opportunity Act of 1996.
       ``(c) Secretarial Encouragement of Current Waivers.--The 
     Secretary shall encourage any State operating a waiver 
     described in subsection (a) to continue the waiver and to 
     evaluate, using random sampling and other characteristics of 
     accepted scientific evaluations, the result or effect of the 
     waiver.
       ``(d) Continuation of Individual Waivers.--A State may 
     elect to continue 1 or more individual waivers described in 
     subsection (a).

     ``SEC. 416. ASSISTANT SECRETARY FOR FAMILY SUPPORT.

       ``The programs under this part and part D shall be 
     administered by an Assistant Secretary for Family Support 
     within the Department of Health and Human Services, who shall 
     be appointed by the President, by and with the advice and 
     consent of the Senate, and who shall be in addition to any 
     other Assistant Secretary of Health and Human Services 
     provided for by law.

     ``SEC. 417. LIMITATION ON FEDERAL AUTHORITY.

       ``No officer or employee of the Federal Government may 
     regulate the conduct of States under this part or enforce any 
     provision of this part, except to the extent expressly 
     provided in this part.''; and
       (2) by inserting after such section 418 the following:

     ``SEC. 419. DEFINITIONS.

       ``As used in this part:
       ``(1) Adult.--The term `adult' means an individual who is 
     not a minor child.
       ``(2) Minor child.--The term `minor child' means an 
     individual who--
       ``(A) has not attained 18 years of age; or
       ``(B) has not attained 19 years of age and is a full-time 
     student in a secondary school (or in the equivalent level of 
     vocational or technical training).
       ``(3) Fiscal year.--The term `fiscal year' means any 12-
     month period ending on September 30 of a calendar year.
       ``(4) Indian, indian tribe, and tribal organization.--
       ``(A) In general.--Except as provided in subparagraph (B), 
     the terms `Indian', `Indian tribe', and `tribal organization' 
     have the meaning given such terms by section 4 of the

[[Page H7856]]

     Indian Self-Determination and Education Assistance Act (25 
     U.S.C. 450b).
       ``(B) Special rule for indian tribes in alaska.--The term 
     `Indian tribe' means, with respect to the State of Alaska, 
     only the Metlakatla Indian Community of the Annette Islands 
     Reserve and the following Alaska Native regional nonprofit 
     corporations:
       ``(i) Arctic Slope Native Association.
       ``(ii) Kawerak, Inc.
       ``(iii) Maniilaq Association.
       ``(iv) Association of Village Council Presidents.
       ``(v) Tanana Chiefs Conference.
       ``(vi) Cook Inlet Tribal Council.
       ``(vii) Bristol Bay Native Association.
       ``(viii) Aleutian and Pribilof Island Association.
       ``(ix) Chugachmuit.
       ``(x) Tlingit Haida Central Council.
       ``(xi) Kodiak Area Native Association.
       ``(xii) Copper River Native Association.
       ``(5) State.--Except as otherwise specifically provided, 
     the term `State' means the 50 States of the United States, 
     the District of Columbia, the Commonwealth of Puerto Rico, 
     the United States Virgin Islands, Guam, and American 
     Samoa.''.
       (b) Grants to Outlying Areas.--Section 1108 (42 U.S.C. 
     1308) is amended--
       (1) by redesignating subsection (c) as subsection (g);
       (2) by striking all that precedes subsection (c) and 
     inserting the following:

     ``SEC. 1108. ADDITIONAL GRANTS TO PUERTO RICO, THE VIRGIN 
                   ISLANDS, GUAM, AND AMERICAN SAMOA; LIMITATION 
                   ON TOTAL PAYMENTS.

       ``(a) Limitation on Total Payments to Each Territory.--
     Notwithstanding any other provision of this Act, the total 
     amount certified by the Secretary of Health and Human 
     Services under titles I, X, XIV, and XVI, under parts A, B, 
     and E of title IV, and under subsection (b) of this section, 
     for payment to any territory for a fiscal year shall not 
     exceed the ceiling amount for the territory for the fiscal 
     year.
       ``(b) Entitlement to Matching Grant.--
       ``(1) In general.--Each territory shall be entitled to 
     receive from the Secretary for each fiscal year a grant in an 
     amount equal to 75 percent of the amount (if any) by which--
       ``(A) the total expenditures of the territory during the 
     fiscal year under the territory programs funded under parts 
     A, B, and E of title IV; exceeds
       ``(B) the sum of--
       ``(i) the total amount required to be paid to the territory 
     (other than with respect to child care) under former section 
     403 (as in effect on September 30, 1995) for fiscal year 
     1995, which shall be determined by applying subparagraphs (C) 
     and (D) of section 403(a)(1) to the territory;
       ``(ii) the total amount required to be paid to the 
     territory under former section 434 (as so in effect) for 
     fiscal year 1995; and
       ``(iii) the total amount expended by the territory during 
     fiscal year 1995 pursuant to parts A, B, and F of title IV 
     (as so in effect), other than for child care.
       ``(2) Use of grant.--Any territory to which a grant is made 
     under paragraph (1) may expend the amount under any program 
     operated or funded under any provision of law specified in 
     subsection (a).
       ``(c) Definitions.--As used in this section:
       ``(1) Territory.--The term `territory' means Puerto Rico, 
     the Virgin Islands, Guam, and American Samoa.
       ``(2) Ceiling amount.--The term `ceiling amount' means, 
     with respect to a territory and a fiscal year, the mandatory 
     ceiling amount with respect to the territory plus the 
     discretionary ceiling amount with respect to the territory, 
     reduced for the fiscal year in accordance with subsection 
     (f).
       ``(3) Mandatory ceiling amount.--The term `mandatory 
     ceiling amount' means--
       ``(A) $105,538,000 with respect to for Puerto Rico;
       ``(B) $4,902,000 with respect to Guam;
       ``(C) $3,742,000 with respect to the Virgin Islands; and
       ``(D) $1,122,000 with respect to American Samoa.
       ``(4) Discretionary ceiling amount.--The term 
     `discretionary ceiling amount' means, with respect to a 
     territory and a fiscal year, the total amount appropriated 
     pursuant to subsection (d)(3) for the fiscal year for payment 
     to the territory.
       ``(5) Total amount expended by the territory.--The term 
     `total amount expended by the territory'--
       ``(A) does not include expenditures during the fiscal year 
     from amounts made available by the Federal Government; and
       ``(B) when used with respect to fiscal year 1995, also does 
     not include--
       ``(i) expenditures during fiscal year 1995 under subsection 
     (g) or (i) of section 402 (as in effect on September 30, 
     1995); or
       ``(ii) any expenditures during fiscal year 1995 for which 
     the territory (but for section 1108, as in effect on 
     September 30, 1995) would have received reimbursement from 
     the Federal Government.
       ``(d) Discretionary Grants.--
       ``(1) In general.--The Secretary shall make a grant to each 
     territory for any fiscal year in the amount appropriated 
     pursuant to paragraph (3) for the fiscal year for payment to 
     the territory.
       ``(2) Use of grant.--Any territory to which a grant is made 
     under paragraph (1) may expend the amount under any program 
     operated or funded under any provision of law specified in 
     subsection (a).
       ``(3) Limitation on authorization of appropriations.--For 
     grants under paragraph (1), there are authorized to be 
     appropriated to the Secretary for each fiscal year--
       ``(A) $7,951,000 for payment to Puerto Rico;
       ``(B) $345,000 for payment to Guam;
       ``(C) $275,000 for payment to the Virgin Islands; and
       ``(D) $190,000 for payment to American Samoa.
       ``(e) Authority to Transfer Funds Among Programs.--
     Notwithstanding any other provision of this Act, any 
     territory to which an amount is paid under any provision of 
     law specified in subsection (a) may use part or all of the 
     amount to carry out any program operated by the territory, or 
     funded, under any other such provision of law.
       ``(f) Maintenance of Effort.--The ceiling amount with 
     respect to a territory shall be reduced for a fiscal year by 
     an amount equal to the amount (if any) by which--
       ``(1) the total amount expended by the territory under all 
     programs of the territory operated pursuant to the provisions 
     of law specified in subsection (a) (as such provisions were 
     in effect for fiscal year 1995) for fiscal year 1995; exceeds
       ``(2) the total amount expended by the territory under all 
     programs of the territory that are funded under the 
     provisions of law specified in subsection (a) for the fiscal 
     year that immediately precedes the fiscal year referred to in 
     the matter preceding paragraph (1).''; and
       (3) by striking subsections (d) and (e).
       (c) Repeal of Provisions Requiring Reduction of Medicaid 
     Payments to States That Reduce Welfare Payment Levels.--
       (1) Section 1903(i) (42 U.S.C. 1396b(i)) is amended by 
     striking paragraph (9).
       (2) Section 1902 (42 U.S.C. 1396a) is amended by striking 
     subsection (c).
       (d) Elimination of Child Care Programs Under the Social 
     Security Act.--
       (1) AFDC and transitional child care programs.--Section 402 
     (42 U.S.C. 602) is amended by striking subsection (g).
       (2) At-risk child care program.--
       (A) Authorization.--Section 402 (42 U.S.C. 602) is amended 
     by striking subsection (i).
       (B) Funding provisions.--Section 403 (42 U.S.C. 603) is 
     amended by striking subsection (n).

     SEC. 4104. SERVICES PROVIDED BY CHARITABLE, RELIGIOUS, OR 
                   PRIVATE ORGANIZATIONS.

       (a) In General.--
       (1) State options.--A State may--
       (A) administer and provide services under the programs 
     described in subparagraphs (A) and (B)(i) of paragraph (2) 
     through contracts with charitable, religious, or private 
     organizations; and
       (B) provide beneficiaries of assistance under the programs 
     described in subparagraphs (A) and (B)(ii) of paragraph (2) 
     with certificates, vouchers, or other forms of disbursement 
     which are redeemable with such organizations.
       (2) Programs described.--The programs described in this 
     paragraph are the following programs:
       (A) A State program funded under part A of title IV of the 
     Social Security Act (as amended by section 4103(a) of this 
     Act).
       (B) Any other program established or modified under 
     subtitle A, B, or F of this title, that--
       (i) permits contracts with organizations; or
       (ii) permits certificates, vouchers, or other forms of 
     disbursement to be provided to beneficiaries, as a means of 
     providing assistance.
       (b) Religious Organizations.--The purpose of this section 
     is to allow States to contract with religious organizations, 
     or to allow religious organizations to accept certificates, 
     vouchers, or other forms of disbursement under any program 
     described in subsection (a)(2), on the same basis as any 
     other nongovernmental provider without impairing the 
     religious character of such organizations, and without 
     diminishing the religious freedom of beneficiaries of 
     assistance funded under such program.
       (c) Nondiscrimination Against Religious Organizations.--In 
     the event a State exercises its authority under subsection 
     (a), religious organizations are eligible, on the same basis 
     as any other private organization, as contractors to provide 
     assistance, or to accept certificates, vouchers, or other 
     forms of disbursement, under any program described in 
     subsection (a)(2) so long as the programs are implemented 
     consistent with the Establishment Clause of the United States 
     Constitution. Except as provided in subsection (k), neither 
     the Federal Government nor a State receiving funds under such 
     programs shall discriminate against an organization which is 
     or applies to be a contractor to provide assistance, or which 
     accepts certificates, vouchers, or other forms of 
     disbursement, on the basis that the organization has a 
     religious character.
       (d) Religious Character and Freedom.--
       (1) Religious organizations.--A religious organization with 
     a contract described in subsection (a)(1)(A), or which 
     accepts certificates, vouchers, or other forms of 
     disbursement under subsection (a)(1)(B), shall retain its 
     independence from Federal, State, and local governments, 
     including such organization's control over the definition, 
     development, practice, and expression of its religious 
     beliefs.
       (2) Additional safeguards.--Neither the Federal Government 
     nor a State shall require a religious organization to--
       (A) alter its form of internal governance; or
       (B) remove religious art, icons, scripture, or other 
     symbols;

[[Page H7857]]

     in order to be eligible to contract to provide assistance, or 
     to accept certificates, vouchers, or other forms of 
     disbursement, funded under a program described in subsection 
     (a)(2).
       (e) Rights of Beneficiaries of Assistance.--
       (1) In general.--If an individual described in paragraph 
     (2) has an objection to the religious character of the 
     organization or institution from which the individual 
     receives, or would receive, assistance funded under 
     any program described in subsection (a)(2), the State in 
     which the individual resides shall provide such individual 
     (if otherwise eligible for such assistance) within a 
     reasonable period of time after the date of such objection 
     with assistance from an alternative provider that is 
     accessible to the individual and the value of which is not 
     less than the value of the assistance which the individual 
     would have received from such organization.
       (2) Individual described.--An individual described in this 
     paragraph is an individual who receives, applies for, or 
     requests to apply for, assistance under a program described 
     in subsection (a)(2).
       (f) Employment Practices.--A religious organization's 
     exemption provided under section 702 of the Civil Rights Act 
     of 1964 (42 U.S.C. 2000e-1a) regarding employment practices 
     shall not be affected by its participation in, or receipt of 
     funds from, programs described in subsection (a)(2).
       (g) Nondiscrimination Against Beneficiaries.--Except as 
     otherwise provided in law, a religious organization shall not 
     discriminate against an individual in regard to rendering 
     assistance funded under any program described in subsection 
     (a)(2) on the basis of religion, a religious belief, or 
     refusal to actively participate in a religious practice.
       (h) Fiscal Accountability.--
       (1) In general.--Except as provided in paragraph (2), any 
     religious organization contracting to provide assistance 
     funded under any program described in subsection (a)(2) shall 
     be subject to the same regulations as other contractors to 
     account in accord with generally accepted auditing principles 
     for the use of such funds provided under such programs.
       (2) Limited audit.--If such organization segregates Federal 
     funds provided under such programs into separate accounts, 
     then only the financial assistance provided with such funds 
     shall be subject to audit.
       (i) Compliance.--Any party which seeks to enforce its 
     rights under this section may assert a civil action for 
     injunctive relief exclusively in an appropriate State court 
     against the entity or agency that allegedly commits such 
     violation.
       (j) Limitations on Use of Funds for Certain Purposes.--No 
     funds provided directly to institutions or organizations to 
     provide services and administer programs under subsection 
     (a)(1)(A) shall be expended for sectarian worship, 
     instruction, or proselytization.
       (k) Preemption.--Nothing in this section shall be construed 
     to preempt any provision of a State constitution or State 
     statute that prohibits or restricts the expenditure of State 
     funds in or by religious organizations.

     SEC. 4105. CENSUS DATA ON GRANDPARENTS AS PRIMARY CAREGIVERS 
                   FOR THEIR GRANDCHILDREN.

       (a) In General.--Not later than 90 days after the date of 
     the enactment of this Act, the Secretary of Commerce, in 
     carrying out section 141 of title 13, United States Code, 
     shall expand the data collection efforts of the Bureau of the 
     Census (in this section referred to as the ``Bureau'') to 
     enable the Bureau to collect statistically significant data, 
     in connection with its decennial census and its mid-decade 
     census, concerning the growing trend of grandparents who are 
     the primary caregivers for their grandchildren.
       (b) Expanded Census Question.--In carrying out subsection 
     (a), the Secretary of Commerce shall expand the Bureau's 
     census question that details households which include both 
     grandparents and their grandchildren. The expanded question 
     shall be formulated to distinguish between the following 
     households:
       (1) A household in which a grandparent temporarily provides 
     a home for a grandchild for a period of weeks or months 
     during periods of parental distress.
       (2) A household in which a grandparent provides a home for 
     a grandchild and serves as the primary caregiver for the 
     grandchild.

     SEC. 4106. REPORT ON DATA PROCESSING.

       (a) In General.--Within 6 months after the date of the 
     enactment of this Act, the Secretary of Health and Human 
     Services shall prepare and submit to the Congress a report 
     on--
       (1) the status of the automated data processing systems 
     operated by the States to assist management in the 
     administration of State programs under part A of title IV of 
     the Social Security Act (whether in effect before or after 
     October 1, 1995); and
       (2) what would be required to establish a system capable 
     of--
       (A) tracking participants in public programs over time; and
       (B) checking case records of the States to determine 
     whether individuals are participating in public programs of 2 
     or more States.
       (b) Preferred Contents.--The report required by subsection 
     (a) should include--
       (1) a plan for building on the automated data processing 
     systems of the States to establish a system with the 
     capabilities described in subsection (a)(2); and
       (2) an estimate of the amount of time required to establish 
     such a system and of the cost of establishing such a system.

     SEC. 4107. STUDY ON ALTERNATIVE OUTCOMES MEASURES.

       (a) Study.--The Secretary shall, in cooperation with the 
     States, study and analyze outcomes measures for evaluating 
     the success of the States in moving individuals out of the 
     welfare system through employment as an alternative to the 
     minimum participation rates described in section 407 of the 
     Social Security Act. The study shall include a determination 
     as to whether such alternative outcomes measures should be 
     applied on a national or a State-by-State basis and a 
     preliminary assessment of the effects of section 409(a)(7)(C) 
     of such Act.
       (b) Report.--Not later than September 30, 1998, the 
     Secretary shall submit to the Committee on Finance of the 
     Senate and the Committee on Ways and Means of the House of 
     Representatives a report containing the findings of the study 
     required by subsection (a).

     SEC. 4108. CONFORMING AMENDMENTS TO THE SOCIAL SECURITY ACT.

       (a) Amendments to Title II.--
       (1) Section 205(c)(2)(C)(vi) (42 U.S.C. 405(c)(2)(C)(vi)), 
     as so redesignated by section 321(a)(9)(B) of the Social 
     Security Independence and Program Improvements Act of 1994, 
     is amended--
       (A) by inserting ``an agency administering a program funded 
     under part A of title IV or'' before ``an agency operating''; 
     and
       (B) by striking ``A or D of title IV of this Act'' and 
     inserting ``D of such title''.
       (2) Section 228(d)(1) (42 U.S.C. 428(d)(1)) is amended by 
     inserting ``under a State program funded under'' before 
     ``part A of title IV''.
       (b) Amendments to Part D of Title IV.--
       (1) Section 451 (42 U.S.C. 651) is amended by striking 
     ``aid'' and inserting ``assistance under a State program 
     funded''.
       (2) Section 452(a)(10)(C) (42 U.S.C. 652(a)(10)(C)) is 
     amended--
       (A) by striking ``aid to families with dependent children'' 
     and inserting ``assistance under a State program funded under 
     part A'';
       (B) by striking ``such aid'' and inserting ``such 
     assistance''; and
       (C) by striking ``under section 402(a)(26) or'' and 
     inserting ``pursuant to section 408(a)(4) or under section''.
       (3) Section 452(a)(10)(F) (42 U.S.C. 652(a)(10)(F)) is 
     amended--
       (A) by striking ``aid under a State plan approved'' and 
     inserting ``assistance under a State program funded''; and
       (B) by striking ``in accordance with the standards referred 
     to in section 402(a)(26)(B)(ii)'' and inserting ``by the 
     State''.
       (4) Section 452(b) (42 U.S.C. 652(b)) is amended in the 
     first sentence by striking ``aid under the State plan 
     approved under part A'' and inserting ``assistance under the 
     State program funded under part A''.
       (5) Section 452(d)(3)(B)(i) (42 U.S.C. 652(d)(3)(B)(i)) is 
     amended by striking ``1115(c)'' and inserting ``1115(b)''.
       (6) Section 452(g)(2)(A)(ii)(I) (42 U.S.C. 
     652(g)(2)(A)(ii)(I)) is amended by striking ``aid is being 
     paid under the State's plan approved under part A or E'' and 
     inserting ``assistance is being provided under the State 
     program funded under part A''.
       (7) Section 452(g)(2)(A) (42 U.S.C. 652(g)(2)(A)) is 
     amended in the matter following clause (iii) by striking 
     ``aid was being paid under the State's plan approved under 
     part A or E'' and inserting ``assistance was being provided 
     under the State program funded under part A''.
       (8) Section 452(g)(2) (42 U.S.C. 652(g)(2)) is amended in 
     the matter following subparagraph (B)--
       (A) by striking ``who is a dependent child'' and inserting 
     ``with respect to whom assistance is being provided under the 
     State program funded under part A'';
       (B) by inserting ``by the State'' after ``found''; and
       (C) by striking ``to have good cause for refusing to 
     cooperate under section 402(a)(26)'' and inserting ``to 
     qualify for a good cause or other exception to cooperation 
     pursuant to section 454(29)''.
       (9) Section 452(h) (42 U.S.C. 652(h)) is amended by 
     striking ``under section 402(a)(26)'' and inserting 
     ``pursuant to section 408(a)(4)''.
       (10) Section 453(c)(3) (42 U.S.C. 653(c)(3)) is amended by 
     striking ``aid under part A of this title'' and inserting 
     ``assistance under a State program funded under part A''.
       (11) Section 454(5)(A) (42 U.S.C. 654(5)(A))) is amended--
       (A) by striking ``under section 402(a)(26)'' and inserting 
     ``pursuant to section 408(a)(4)''; and
       (B) by striking ``; except that this paragraph shall not 
     apply to such payments for any month following the first 
     month in which the amount collected is sufficient to make 
     such family ineligible for assistance under the State plan 
     approved under part A;'' and inserting a comma.
       (12) Section 454(6)(D) (42 U.S.C. 654(6)(D)) is amended by 
     striking ``aid under a State plan approved'' and inserting 
     ``assistance under a State program funded''.
       (13) Section 456(a)(1) (42 U.S.C. 656(a)(1)) is amended by 
     striking ``under section 402(a)(26)''.
       (14) Section 466(a)(3)(B) (42 U.S.C. 666(a)(3)(B)) is 
     amended by striking ``402(a)(26)'' and inserting 
     ``408(a)(3)''.
       (15) Section 466(b)(2) (42 U.S.C. 666(b)(2)) is amended by 
     striking ``aid'' and inserting ``assistance under a State 
     program funded''.

[[Page H7858]]

       (16) Section 469(a) (42 U.S.C. 669(a)) is amended--
       (A) by striking ``aid under plans approved'' and inserting 
     ``assistance under State programs funded''; and
       (B) by striking ``such aid'' and inserting ``such 
     assistance''.
       (c) Repeal of Part F of Title IV.--Part F of title IV (42 
     U.S.C. 681-687) is repealed.
       (d) Amendment to Title X.--Section 1002(a)(7) (42 U.S.C. 
     1202(a)(7)) is amended by striking ``aid to families with 
     dependent children under the State plan approved 
     under section 402 of this Act'' and inserting ``assistance 
     under a State program funded under part A of title IV''.
       (e) Amendments to Title XI.--
       (1) Section 1109 (42 U.S.C. 1309) is amended by striking 
     ``or part A of title IV,''.
       (2) Section 1115 (42 U.S.C. 1315) is amended--
       (A) in subsection (a)(2)--
       (i) by inserting ``(A)'' after ``(2)'';
       (ii) by striking ``403,'';
       (iii) by striking the period at the end and inserting ``, 
     and''; and
       (iv) by adding at the end the following new subparagraph:
       ``(B) costs of such project which would not otherwise be a 
     permissible use of funds under part A of title IV and which 
     are not included as part of the costs of projects under 
     section 1110, shall to the extent and for the period 
     prescribed by the Secretary, be regarded as a permissible use 
     of funds under such part.''; and
       (B) in subsection (c)(3), by striking ``the program of aid 
     to families with dependent children'' and inserting ``part A 
     of such title''.
       (3) Section 1116 (42 U.S.C. 1316) is amended--
       (A) in each of subsections (a)(1), (b), and (d), by 
     striking ``or part A of title IV,''; and
       (B) in subsection (a)(3), by striking ``404,''.
       (4) Section 1118 (42 U.S.C. 1318) is amended--
       (A) by striking ``403(a),'';
       (B) by striking ``and part A of title IV,''; and
       (C) by striking ``, and shall, in the case of American 
     Samoa, mean 75 per centum with respect to part A of title 
     IV''.
       (5) Section 1119 (42 U.S.C. 1319) is amended--
       (A) by striking ``or part A of title IV''; and
       (B) by striking ``403(a),''.
       (6) Section 1133(a) (42 U.S.C. 1320b-3(a)) is amended by 
     striking ``or part A of title IV,''.
       (7) Section 1136 (42 U.S.C. 1320b-6) is repealed.
       (8) Section 1137 (42 U.S.C. 1320b-7) is amended--
       (A) in subsection (b), by striking paragraph (1) and 
     inserting the following:
       ``(1) any State program funded under part A of title IV of 
     this Act;''; and
       (B) in subsection (d)(1)(B)--
       (i) by striking ``In this subsection--'' and all that 
     follows through ``(ii) in'' and inserting ``In this 
     subsection, in'';
       (ii) by redesignating subclauses (I), (II), and (III) as 
     clauses (i), (ii), and (iii); and
       (iii) by moving such redesignated material 2 ems to the 
     left.
       (f) Amendment to Title XIV.--Section 1402(a)(7) (42 U.S.C. 
     1352(a)(7)) is amended by striking ``aid to families with 
     dependent children under the State plan approved under 
     section 402 of this Act'' and inserting ``assistance under a 
     State program funded under part A of title IV''.
       (g) Amendment to Title XVI as in Effect With Respect to the 
     Territories.--Section 1602(a)(11), as in effect without 
     regard to the amendment made by section 301 of the Social 
     Security Amendments of 1972 (42 U.S.C. 1382 note), is amended 
     by striking ``aid under the State plan approved'' and 
     inserting ``assistance under a State program funded''.
       (h) Amendment to Title XVI as in Effect With Respect to the 
     States.--Section 1611(c)(5)(A) (42 U.S.C. 1382(c)(5)(A)) is 
     amended to read as follows: ``(A) a State program funded 
     under part A of title IV,''.
       (i) Amendment to Title XIX.--Section 1902(j) (42 U.S.C. 
     1396a(j)) is amended by striking ``1108(c)'' and inserting 
     ``1108(g)''.

     SEC. 4109. CONFORMING AMENDMENTS TO THE FOOD STAMP ACT OF 
                   1977 AND RELATED PROVISIONS.

       (a) Section 5 of the Food Stamp Act of 1977 (7 U.S.C. 2014) 
     is amended--
       (1) in the second sentence of subsection (a), by striking 
     ``plan approved'' and all that follows through ``title IV of 
     the Social Security Act'' and inserting ``program funded 
     under part A of title IV of the Social Security Act (42 
     U.S.C. 601 et seq.)'';
       (2) in subsection (d)--
       (A) in paragraph (5), by striking ``assistance to families 
     with dependent children'' and inserting ``assistance under a 
     State program funded''; and
       (B) by striking paragraph (13) and redesignating paragraphs 
     (14), (15), and (16) as paragraphs (13), (14), and (15), 
     respectively;
       (3) in subsection (j), by striking ``plan approved under 
     part A of title IV of such Act (42 U.S.C. 601 et seq.)'' and 
     inserting ``program funded under part A of title IV of the 
     Act (42 U.S.C. 601 et seq.)''; and
       (4) by striking subsection (m).
       (b) Section 6 of such Act (7 U.S.C. 2015) is amended--
       (1) in subsection (c)(5), by striking ``the State plan 
     approved'' and inserting ``the State program funded''; and
       (2) in subsection (e)(6), by striking ``aid to families 
     with dependent children'' and inserting ``benefits under a 
     State program funded''.
       (c) Section 16(g)(4) of such Act (7 U.S.C. 2025(g)(4)) is 
     amended by striking ``State plans under the Aid to Families 
     with Dependent Children Program under'' and inserting ``State 
     programs funded under part A of''.
       (d) Section 17 of such Act (7 U.S.C. 2026) is amended--
       (1) in the first sentence of subsection (b)(1)(A), by 
     striking ``to aid to families with dependent children under 
     part A of title IV of the Social Security Act'' and inserting 
     ``or are receiving assistance under a State program funded 
     under part A of title IV of the Social Security Act (42 
     U.S.C. 601 et seq.)''; and
       (2) in subsection (b)(3), by adding at the end the 
     following new subparagraph:
       ``(I) The Secretary may not grant a waiver under this 
     paragraph on or after October 1, 1995. Any reference in this 
     paragraph to a provision of title IV of the Social Security 
     Act shall be deemed to be a reference to such provision as in 
     effect on September 30, 1995.'';
       (e) Section 20 of such Act (7 U.S.C. 2029) is amended--
       (1) in subsection (a)(2)(B) by striking ``operating--'' and 
     all that follows through ``(ii) any other'' and inserting 
     ``operating any''; and
       (2) in subsection (b)--
       (A) in paragraph (1)--
       (i) by striking ``(b)(1) A household'' and inserting ``(b) 
     A household''; and
       (ii) in subparagraph (B), by striking ``training program'' 
     and inserting ``activity'';
       (B) by striking paragraph (2); and
       (C) by redesignating subparagraphs (A) through (F) as 
     paragraphs (1) through (6), respectively.
       (f) Section 5(h)(1) of the Agriculture and Consumer 
     Protection Act of 1973 (Public Law 93-186; 7 U.S.C. 612c 
     note) is amended by striking ``the program for aid to 
     families with dependent children'' and inserting ``the State 
     program funded''.
       (g) Section 9 of the National School Lunch Act (42 U.S.C. 
     1758) is amended--
       (1) in subsection (b)--
       (A) in paragraph (2)(C)(ii)(II)--
       (i) by striking ``program for aid to families with 
     dependent children'' and inserting ``State program funded''; 
     and
       (ii) by inserting before the period at the end the 
     following: ``that the Secretary determines complies with 
     standards established by the Secretary that ensure that the 
     standards under the State program are comparable to or more 
     restrictive than those in effect on June 1, 1995''; and
       (B) in paragraph (6)--
       (i) in subparagraph (A)(ii)--

       (I) by striking ``an AFDC assistance unit (under the aid to 
     families with dependent children program authorized'' and 
     inserting ``a family (under the State program funded''; and
       (II) by striking ``, in a State'' and all that follows 
     through ``9902(2)))'' and inserting ``that the Secretary 
     determines complies with standards established by the 
     Secretary that ensure that the standards under the State 
     program are comparable to or more restrictive than those in 
     effect on June 1, 1995''; and

       (ii) in subparagraph (B), by striking ``aid to families 
     with dependent children'' and inserting ``assistance under 
     the State program funded under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.) that the 
     Secretary determines complies with standards established by 
     the Secretary that ensure that the standards under the State 
     program are comparable to or more restrictive than those in 
     effect on June 1, 1995''; and
       (2) in subsection (d)(2)(C)--
       (A) by striking ``program for aid to families with 
     dependent children'' and inserting ``State program funded''; 
     and
       (B) by inserting before the period at the end the 
     following: ``that the Secretary determines complies with 
     standards established by the Secretary that ensure that the 
     standards under the State program are comparable to or more 
     restrictive than those in effect on June 1, 1995''.
       (h) Section 17(d)(2)(A)(ii)(II) of the Child Nutrition Act 
     of 1966 (42 U.S.C. 1786(d)(2)(A)(ii)(II)) is amended--
       (1) by striking ``program for aid to families with 
     dependent children established'' and inserting ``State 
     program funded''; and
       (2) by inserting before the semicolon the following: ``that 
     the Secretary determines complies with standards established 
     by the Secretary that ensure that the standards under the 
     State program are comparable to or more restrictive than 
     those in effect on June 1, 1995''.

     SEC. 4110. CONFORMING AMENDMENTS TO OTHER LAWS.

       (a) Subsection (b) of section 508 of the Unemployment 
     Compensation Amendments of 1976 (42 U.S.C. 603a; Public Law 
     94-566; 90 Stat. 2689) is amended to read as follows:
       ``(b) Provision for Reimbursement of Expenses.--For 
     purposes of section 455 of the Social Security Act, expenses 
     incurred to reimburse State employment offices for furnishing 
     information requested of such offices--
       ``(1) pursuant to the third sentence of section 3(a) of the 
     Act entitled `An Act to provide for the establishment of a 
     national employment system and for cooperation with the 
     States in the promotion of such system, and for other 
     purposes', approved June 6, 1933 (29 U.S.C. 49b(a)), or
       ``(2) by a State or local agency charged with the duty of 
     carrying a State plan for child support approved under part D 
     of title IV of the Social Security Act,


[[Page H7859]]


     shall be considered to constitute expenses incurred in the 
     administration of such State plan.''.
       (b) Section 9121 of the Omnibus Budget Reconciliation Act 
     of 1987 (42 U.S.C. 602 note) is repealed.
       (c) Section 9122 of the Omnibus Budget Reconciliation Act 
     of 1987 (42 U.S.C. 602 note) is repealed.
       (d) Section 221 of the Housing and Urban-Rural Recovery Act 
     of 1983 (42 U.S.C. 602 note), relating to treatment under 
     AFDC of certain rental payments for federally assisted 
     housing, is repealed.
       (e) Section 159 of the Tax Equity and Fiscal Responsibility 
     Act of 1982 (42 U.S.C. 602 note) is repealed.
       (f) Section 202(d) of the Social Security Amendments of 
     1967 (81 Stat. 882; 42 U.S.C. 602 note) is repealed.
       (g) Section 903 of the Stewart B. McKinney Homeless 
     Assistance Amendments Act of 1988 (42 U.S.C. 11381 note), 
     relating to demonstration projects to reduce number of AFDC 
     families in welfare hotels, is amended--
       (1) in subsection (a), by striking ``aid to families with 
     dependent children under a State plan approved'' and 
     inserting ``assistance under a State program funded''; and
       (2) in subsection (c), by striking ``aid to families with 
     dependent children in the State under a State plan approved'' 
     and inserting ``assistance in the State under a State program 
     funded''.
       (h) The Higher Education Act of 1965 (20 U.S.C. 1001 et 
     seq.) is amended--
       (1) in section 404C(c)(3) (20 U.S.C. 1070a-23(c)(3)), by 
     striking ``(Aid to Families with Dependent Children)''; and
       (2) in section 480(b)(2) (20 U.S.C. 1087vv(b)(2)), by 
     striking ``aid to families with dependent children under a 
     State plan approved'' and inserting ``assistance under a 
     State program funded''.
       (i) The Carl D. Perkins Vocational and Applied Technology 
     Education Act (20 U.S.C. 2301 et seq.) is amended--
       (1) in section 231(d)(3)(A)(ii) (20 U.S.C. 
     2341(d)(3)(A)(ii)), by striking ``The program for aid to 
     dependent children'' and inserting ``The State program 
     funded'';
       (2) in section 232(b)(2)(B) (20 U.S.C. 2341a(b)(2)(B)), by 
     striking ``the program for aid to families with dependent 
     children'' and inserting ``the State program funded''; and
       (3) in section 521(14)(B)(iii) (20 U.S.C. 
     2471(14)(B)(iii)), by striking ``the program for aid to 
     families with dependent children'' and inserting ``the State 
     program funded''.
       (j) The Elementary and Secondary Education Act of 1965 (20 
     U.S.C. 2701 et seq.) is amended--
       (1) in section 1113(a)(5) (20 U.S.C. 6313(a)(5)), by 
     striking ``Aid to Families with Dependent Children program'' 
     and inserting ``State program funded under part A of title IV 
     of the Social Security Act'';
       (2) in section 1124(c)(5) (20 U.S.C. 6333(c)(5)), by 
     striking ``the program of aid to families with dependent 
     children under a State plan approved under'' and inserting 
     ``a State program funded under part A of''; and
       (3) in section 5203(b)(2) (20 U.S.C. 7233(b)(2))--
       (A) in subparagraph (A)(xi), by striking ``Aid to Families 
     with Dependent Children benefits'' and inserting ``assistance 
     under a State program funded under part A of title IV of the 
     Social Security Act''; and
       (B) in subparagraph (B)(viii), by striking ``Aid to 
     Families with Dependent Children'' and inserting ``assistance 
     under the State program funded under part A of title IV of 
     the Social Security Act''.
       (k) The 4th proviso of chapter VII of title I of Public Law 
     99-88 (25 U.S.C. 13d-1) is amended to read as follows: 
     ``Provided further, That general assistance payments made by 
     the Bureau of Indian Affairs shall be made--
       ``(1) after April 29, 1985, and before October 1, 1995, on 
     the basis of Aid to Families with Dependent Children (AFDC) 
     standards of need; and
       ``(2) on and after October 1, 1995, on the basis of 
     standards of need established under the State program funded 
     under part A of title IV of the Social Security Act,

     except that where a State ratably reduces its AFDC or State 
     program payments, the Bureau shall reduce general assistance 
     payments in such State by the same percentage as the State 
     has reduced the AFDC or State program payment.''.
       (l) The Internal Revenue Code of 1986 (26 U.S.C. 1 et seq.) 
     is amended--
       (1) in section 51(d)(9) (26 U.S.C. 51(d)(9)), by striking 
     all that follows ``agency as'' and inserting ``being eligible 
     for financial assistance under part A of title IV of the 
     Social Security Act and as having continually received 
     such financial assistance during the 90-day period which 
     immediately precedes the date on which such individual is 
     hired by the employer.'';
       (2) in section 3304(a)(16) (26 U.S.C. 3304(a)(16)), by 
     striking ``eligibility for aid or services,'' and all that 
     follows through ``children approved'' and inserting 
     ``eligibility for assistance, or the amount of such 
     assistance, under a State program funded'';
       (3) in section 6103(l)(7)(D)(i) (26 U.S.C. 
     6103(l)(7)(D)(i)), by striking ``aid to families with 
     dependent children provided under a State plan approved'' and 
     inserting ``a State program funded'';
       (4) in section 6103(l)(10) (26 U.S.C. 6103(l)(10))--
       (A) by striking ``(c) or (d)'' each place it appears and 
     inserting ``(c), (d), or (e)''; and
       (B) by adding at the end of subparagraph (B) the following 
     new sentence: ``Any return information disclosed with respect 
     to section 6402(e) shall only be disclosed to officers and 
     employees of the State agency requesting such information.'';
       (5) in section 6103(p)(4) (26 U.S.C. 6103(p)(4)), in the 
     matter preceding subparagraph (A)--
       (A) by striking ``(5), (10)'' and inserting ``(5)''; and
       (B) by striking ``(9), or (12)'' and inserting ``(9), (10), 
     or (12)'';
       (6) in section 6334(a)(11)(A) (26 U.S.C. 6334(a)(11)(A)), 
     by striking ``(relating to aid to families with dependent 
     children)'';
       (7) in section 6402 (26 U.S.C. 6402)--
       (A) in subsection (a), by striking ``(c) and (d)'' and 
     inserting ``(c), (d), and (e)'';
       (B) by redesignating subsections (e) through (i) as 
     subsections (f) through (j), respectively; and
       (C) by inserting after subsection (d) the following:
       ``(e) Collection of Overpayments Under Title IV-A of the 
     Social Security Act.--The amount of any overpayment to be 
     refunded to the person making the overpayment shall be 
     reduced (after reductions pursuant to subsections (c) and 
     (d), but before a credit against future liability for an 
     internal revenue tax) in accordance with section 405(e) of 
     the Social Security Act (concerning recovery of overpayments 
     to individuals under State plans approved under part A of 
     title IV of such Act).''; and
       (8) in section 7523(b)(3)(C) (26 U.S.C. 7523(b)(3)(C)), by 
     striking ``aid to families with dependent children'' and 
     inserting ``assistance under a State program funded under 
     part A of title IV of the Social Security Act''.
       (m) Section 3(b) of the Wagner-Peyser Act (29 U.S.C. 
     49b(b)) is amended by striking ``State plan approved under 
     part A of title IV'' and inserting ``State program funded 
     under part A of title IV''.
       (n) The Job Training Partnership Act (29 U.S.C. 1501 et 
     seq.) is amended--
       (1) in section 4(29)(A)(i) (29 U.S.C. 1503(29)(A)(i)), by 
     striking ``(42 U.S.C. 601 et seq.)'';
       (2) in section 106(b)(6)(C) (29 U.S.C. 1516(b)(6)(C)), by 
     striking ``State aid to families with dependent children 
     records,'' and inserting ``records collected under the State 
     program funded under part A of title IV of the Social 
     Security Act,'';
       (3) in section 121(b)(2) (29 U.S.C. 1531(b)(2))--
       (A) by striking ``the JOBS program'' and inserting ``the 
     work activities required under title IV of the Social 
     Security Act''; and
       (B) by striking the second sentence;
       (4) in section 123(c) (29 U.S.C. 1533(c))--
       (A) in paragraph (1)(E), by repealing clause (vi); and
       (B) in paragraph (2)(D), by repealing clause (v);
       (5) in section 203(b)(3) (29 U.S.C. 1603(b)(3)), by 
     striking ``, including recipients under the JOBS program'';
       (6) in subparagraphs (A) and (B) of section 204(a)(1) (29 
     U.S.C. 1604(a)(1) (A) and (B)), by striking ``(such as the 
     JOBS program)'' each place it appears;
       (7) in section 205(a) (29 U.S.C. 1605(a)), by striking 
     paragraph (4) and inserting the following:
       ``(4) the portions of title IV of the Social Security Act 
     relating to work activities;'';
       (8) in section 253 (29 U.S.C. 1632)--
       (A) in subsection (b)(2), by repealing subparagraph (C); 
     and
       (B) in paragraphs (1)(B) and (2)(B) of subsection (c), by 
     striking ``the JOBS program or'' each place it appears;
       (9) in section 264 (29 U.S.C. 1644)--
       (A) in subparagraphs (A) and (B) of subsection (b)(1), by 
     striking ``(such as the JOBS program)'' each place it 
     appears; and
       (B) in subparagraphs (A) and (B) of subsection (d)(3), by 
     striking ``and the JOBS program'' each place it appears;
       (10) in section 265(b) (29 U.S.C. 1645(b)), by striking 
     paragraph (6) and inserting the following:
       ``(6) the portion of title IV of the Social Security Act 
     relating to work activities;'';
       (11) in the second sentence of section 429(e) (29 U.S.C. 
     1699(e)), by striking ``and shall be in an amount that does 
     not exceed the maximum amount that may be provided by the 
     State pursuant to section 402(g)(1)(C) of the Social Security 
     Act (42 U.S.C. 602(g)(1)(C))'';
       (12) in section 454(c) (29 U.S.C. 1734(c)), by striking 
     ``JOBS and'';
       (13) in section 455(b) (29 U.S.C. 1735(b)), by striking 
     ``the JOBS program,'';
       (14) in section 501(1) (29 U.S.C. 1791(1)), by striking 
     ``aid to families with dependent children under part A of 
     title IV of the Social Security Act (42 U.S.C. 601 et seq.)'' 
     and inserting ``assistance under the State program funded 
     under part A of title IV of the Social Security Act'';
       (15) in section 506(1)(A) (29 U.S.C. 1791e(1)(A)), by 
     striking ``aid to families with dependent children'' and 
     inserting ``assistance under the State program funded'';
       (16) in section 508(a)(2)(A) (29 U.S.C. 1791g(a)(2)(A)), by 
     striking ``aid to families with dependent children'' and 
     inserting ``assistance under the State program funded''; and
       (17) in section 701(b)(2)(A) (29 U.S.C. 1792(b)(2)(A))--
       (A) in clause (v), by striking the semicolon and inserting 
     ``; and''; and
       (B) by striking clause (vi).
       (o) Section 3803(c)(2)(C)(iv) of title 31, United States 
     Code, is amended to read as follows:

[[Page H7860]]

       ``(iv) assistance under a State program funded under part A 
     of title IV of the Social Security Act;''.
       (p) Section 2605(b)(2)(A)(i) of the Low-Income Home Energy 
     Assistance Act of 1981 (42 U.S.C. 8624(b)(2)(A)(i)) is 
     amended to read as follows:
       ``(i) assistance under the State program funded under part 
     A of title IV of the Social Security Act;''.
       (q) Section 303(f)(2) of the Family Support Act of 1988 (42 
     U.S.C. 602 note) is amended--
       (1) by striking ``(A)''; and
       (2) by striking subparagraphs (B) and (C).
       (r) The Balanced Budget and Emergency Deficit Control Act 
     of 1985 (2 U.S.C. 900 et seq.) is amended--
       (1) in the first section 255(h) (2 U.S.C. 905(h)), by 
     striking ``Aid to families with dependent children (75-0412-
     0-1-609);'' and inserting ``Block grants to States for 
     temporary assistance for needy families;''; and
       (2) in section 256 (2 U.S.C. 906)--
       (A) by striking subsection (k); and
       (B) by redesignating subsection (l) as subsection (k).
       (s) The Immigration and Nationality Act (8 U.S.C. 1101 et 
     seq.) is amended--
       (1) in section 210(f) (8 U.S.C. 1160(f)), by striking ``aid 
     under a State plan approved under'' each place it appears and 
     inserting ``assistance under a State program funded under'';
       (2) in section 245A(h) (8 U.S.C. 1255a(h))--
       (A) in paragraph (1)(A)(i), by striking ``program of aid to 
     families with dependent children'' and inserting ``State 
     program of assistance''; and
       (B) in paragraph (2)(B), by striking ``aid to families with 
     dependent children'' and inserting ``assistance under a State 
     program funded under part A of title IV of the Social 
     Security Act''; and
       (3) in section 412(e)(4) (8 U.S.C. 1522(e)(4)), by striking 
     ``State plan approved'' and inserting ``State program 
     funded''.
       (t) Section 640(a)(4)(B)(i) of the Head Start Act (42 
     U.S.C. 9835(a)(4)(B)(i)) is amended by striking ``program of 
     aid to families with dependent children under a State plan 
     approved'' and inserting ``State program of assistance 
     funded''.
       (u) Section 9 of the Act of April 19, 1950 (64 Stat. 47, 
     chapter 92; 25 U.S.C. 639) is repealed.
       (v) Subparagraph (E) of section 213(d)(6) of the School-To-
     Work Opportunities Act of 1994 (20 U.S.C. 6143(d)(6)) is 
     amended to read as follows:
       ``(E) part A of title IV of the Social Security Act (42 
     U.S.C. 601 et seq.) relating to work activities;''.
       (w) Section 552a(a)(8)(B)(iv)(III) of title 5, United 
     States Code, is amended by striking ``section 464 or 1137 of 
     the Social Security Act'' and inserting ``section 404(e), 
     464, or 1137 of the Social Security Act''.

     SEC. 4111. DEVELOPMENT OF PROTOTYPE OF COUNTERFEIT-RESISTANT 
                   SOCIAL SECURITY CARD REQUIRED.

       (a) Development.--
       (1) In general.--The Commissioner of Social Security (in 
     this section referred to as the ``Commissioner'') shall, in 
     accordance with this section, develop a prototype of a 
     counterfeit-resistant social security card. Such prototype 
     card shall--
       (A) be made of a durable, tamper-resistant material such as 
     plastic or polyester,
       (B) employ technologies that provide security features, 
     such as magnetic stripes, holograms, and integrated circuits, 
     and
       (C) be developed so as to provide individuals with reliable 
     proof of citizenship or legal resident alien status.
       (2) Assistance by attorney general.--The Attorney General 
     of the United States shall provide such information and 
     assistance as the Commissioner deems necessary to enable the 
     Commissioner to comply with this section.
       (b) Study and Report.--
       (1) In general.--The Commissioner shall conduct a study and 
     issue a report to Congress which examines different methods 
     of improving the social security card application process.
       (2) Elements of study.--The study shall include an 
     evaluation of the cost and work load implications of issuing 
     a counterfeit-resistant social security card for all 
     individuals over a 3-, 5-, and 10-year period. The study 
     shall also evaluate the feasibility and cost implications of 
     imposing a user fee for replacement cards and cards issued to 
     individuals who apply for such a card prior to the scheduled 
     3-, 5-, and 10-year phase-in options.
       (3) Distribution of report.--The Commissioner shall submit 
     copies of the report described in this subsection along with 
     a facsimile of the prototype card as described in 
     subsection (a) to the Committees on Ways and Means and 
     Judiciary of the House of Representatives and the 
     Committees on Finance and Judiciary of the Senate within 1 
     year after the date of the enactment of this Act.

     SEC. 4112. DISCLOSURE OF RECEIPT OF FEDERAL FUNDS.

       (a) In General.--Whenever an organization that accepts 
     Federal funds under this title or the amendments made by this 
     title (other than funds provided under title IV, XVI, or XX 
     of the Social Security Act) makes any communication that in 
     any way intends to promote public support or opposition to 
     any policy of a Federal, State, or local government through 
     any broadcasting station, newspaper, magazine, outdoor 
     advertising facility, direct mailing, or any other type of 
     general public advertising, such communication shall state 
     the following: ``This was prepared and paid for by an 
     organization that accepts taxpayer dollars.''.
       (b) Failure To Comply.--If an organization makes any 
     communication described in subsection (a) and fails to 
     provide the statement required by that subsection, such 
     organization shall be ineligible to receive Federal funds 
     under this title or the amendments made by this title.
       (c) Definition.--For purposes of this section, the term 
     ``organization'' means an organization described in section 
     501(c) of the Internal Revenue Code of 1986.
       (d) Effective Dates.--This section shall take effect--
       (1) with respect to printed communications 1 year after the 
     date of enactment of this Act; and
       (2) with respect to any other communication on the date of 
     enactment of this Act.

     SEC. 4113. MODIFICATIONS TO THE JOB OPPORTUNITIES FOR CERTAIN 
                   LOW-INCOME INDIVIDUALS PROGRAM.

       Section 505 of the Family Support Act of 1988 (42 U.S.C. 
     1315 note) is amended--
       (1) in the heading, by striking ``DEMONSTRATION'';
       (2) by striking ``demonstration'' each place such term 
     appears;
       (3) in subsection (a), by striking ``in each of fiscal 
     years'' and all that follows through ``10'' and inserting 
     ``shall enter into agreements with'';
       (4) in subsection (b)(3), by striking ``aid to families 
     with dependent children under part A of title IV of the 
     Social Security Act'' and inserting ``assistance under the 
     program funded part A of title IV of the Social Security Act 
     of the State in which the individual resides'';
       (5) in subsection (c)--
       (A) in paragraph (1)(C), by striking ``aid to families with 
     dependent children under title IV of the Social Security 
     Act'' and inserting ``assistance under a State program funded 
     part A of title IV of the Social Security Act'';
       (B) in paragraph (2), by striking ``aid to families with 
     dependent children under title IV of such Act'' and inserting 
     ``assistance under a State program funded part A of title IV 
     of the Social Security Act'';
       (6) in subsection (d), by striking ``job opportunities and 
     basic skills training program (as provided for under title IV 
     of the Social Security Act)'' and inserting ``the State 
     program funded under part A of title IV of the Social 
     Security Act''; and
       (7) by striking subsections (e) through (g) and inserting 
     the following:
       ``(e) Authorization of Appropriations.--For the purpose of 
     conducting projects under this section, there is authorized 
     to be appropriated an amount not to exceed $25,000,000 for 
     any fiscal year.''.

     SEC. 4114. SECRETARIAL SUBMISSION OF LEGISLATIVE PROPOSAL FOR 
                   TECHNICAL AND CONFORMING AMENDMENTS.

       Not later than 90 days after the date of the enactment of 
     this Act, the Secretary of Health and Human Services and the 
     Commissioner of Social Security, in consultation, 
     as appropriate, with the heads of other Federal agencies, 
     shall submit to the appropriate committees of Congress a 
     legislative proposal proposing such technical and 
     conforming amendments as are necessary to bring the law 
     into conformity with the policy embodied in this subtitle.

     SEC. 4115. CONFORMING AMENDMENTS TO MEDICAID PROGRAM.

       (a) In General.--Title XIX is amended--
       (1) in section 1931, by inserting ``subject to section 
     1931(a),'' in subsection (a) after ``under this title,'' and 
     by redesignating such section as section 1932; and
       (2) by inserting after section 1930 the following new 
     section:


``continued application of standards and methodologies under part a of 
                    title iv for certain individuals

       ``Sec. 1931. (a) For purposes of applying this title with 
     respect to a State, notwithstanding any other provision of 
     this title--
       ``(1) except as provided in paragraphs (2) through (4), any 
     reference in this title (or other provision of law in 
     relation to the operation of this title) to a provision of 
     part A of title IV, or a State plan under such part, shall be 
     considered a reference to such provision or plan as in effect 
     as of July 16, 1996, with respect to the State and 
     eligibility for medical assistance under this title shall be 
     determined as if such provision or plan (as in effect as of 
     such date) remained in effect;
       ``(2) any reference in section 1902(a)(5) or 1902(a)(55) to 
     a State plan approved under part A of title IV shall be 
     deemed a reference to a State program funded under such part;
       ``(3) a State may provide that any income standard under 
     the State plan referred to in paragraph (1) may be increased 
     over a period (beginning after July 16, 1996) by a percentage 
     that does not exceed the percentage increase in the consumer 
     price index for all urban consumers (all items; U.S. city 
     average) over such period; and
       ``(4) in applying section 1925, medical assistance is 
     required to be provided under such section only if it is 
     required to be provided under section 408(a)(13).
       ``(b) In the case of a waiver of a provision of part A of 
     title IV in effect with respect to a State as of July 16, 
     1996, if the waiver affects eligibility of individuals for 
     medical assistance under this title, such waiver may continue 
     to be applied, at the option of the State, in relation to 
     this title after the date the waiver would otherwise 
     expire.''.
       (b) Plan Amendment.--Section 1902(a) (42 U.S.C. 1396a(a)) 
     is amended--

[[Page H7861]]

       (1) by striking ``and'' at the end of paragraph (61),
       (2) by striking the period at the end of paragraph (62) and 
     inserting ``; and'', and
       (3) by inserting after paragraph (62) the following new 
     paragraph:
       ``(63) provide for continuing to administer eligibility 
     standards with respect to individuals who are (or seek to be) 
     eligible for medical assistance based on the application of 
     section 1931.''.
       (c) Conforming Amendments.--(1) Section 1902(c) (42 U.S.C. 
     1396a(c)) is amended by striking ``if--'' and all that 
     follows and inserting the following: ``if the State requires 
     individuals described in subsection (l)(1) to apply for 
     assistance under the State program funded under part A of 
     title IV as a condition of applying for or receiving medical 
     assistance under this title.''.
       (2) Section 1903(i) (42 U.S.C. 1396b(i)) is amended by 
     striking paragraph (9).

     SEC. 4116. EFFECTIVE DATE; TRANSITION RULE.

       (a) Effective Dates.--
       (1) In general.--Except as otherwise provided in this 
     subtitle, this subtitle and the amendments made by this 
     subtitle shall take effect on July 1, 1997.
       (2) Delayed effective date for certain provisions.--
     Notwithstanding any other provision of this section, 
     paragraphs (2), (3), (4), (5), (8), and (10) of 
     section 409(a) and section 411(a) of the Social Security 
     Act (as added by the amendments made by section 4103(a) of 
     this Act) shall not take effect with respect to a State 
     until, and shall apply only with respect to conduct that 
     occurs on or after, the later of--
       (A) July 1, 1997; or
       (B) the date that is 6 months after the date the Secretary 
     of Health and Human Services receives from the State a plan 
     described in section 402(a) of the Social Security Act (as 
     added by such amendment).
       (3) Elimination of child care programs.--The amendments 
     made by section 4103(d) shall take effect on October 1, 1996.
       (4) Definitions applicable to new child care entitlement.--
     Sections 403(a)(1)(C), 403(a)(1)(D), and 419(4) of the Social 
     Security Act, as added by the amendments made by section 
     4103(a) of this Act, shall take effect on October 1, 1996.
       (b) Transition Rules.--Effective on the date of the 
     enactment of this Act:
       (1) State option to accelerate effective date.--
       (A) In general.--If the Secretary of Health and Human 
     Services receives from a State a plan described in section 
     402(a) of the Social Security Act (as added by the amendment 
     made by section 4103(a)(1) of this Act), then--
       (i) on and after the date of such receipt--

       (I) except as provided in clause (ii), this subtitle and 
     the amendments made by this subtitle (other than by section 
     4103(d) of this Act) shall apply with respect to the State; 
     and
       (II) the State shall be considered an eligible State for 
     purposes of part A of title IV of the Social Security Act (as 
     in effect pursuant to the amendments made by such section 
     4103(a)); and

       (ii) during the period that begins on the date of such 
     receipt and ends on June 30, 1997, there shall remain in 
     effect with respect to the State--

       (I) section 403(h) of the Social Security Act (as in effect 
     on September 30, 1995); and
       (II) all State reporting requirements under parts A and F 
     of title IV of the Social Security Act (as in effect on 
     September 30, 1995), modified by the Secretary as 
     appropriate, taking into account the State program under part 
     A of title IV of the Social Security Act (as in effect 
     pursuant to the amendments made by such section 4103(a)).

       (B) Limitations on federal obligations.--
       (i) Under afdc program.--The total obligations of the 
     Federal Government to a State under part A of title IV of the 
     Social Security Act (as in effect on September 30, 1995) with 
     respect to expenditures in fiscal year 1997 shall not exceed 
     an amount equal to the State family assistance grant.
       (ii) Under temporary family assistance program.--
     Notwithstanding section 403(a)(1) of the Social Security Act 
     (as in effect pursuant to the amendments made by section 
     4103(a) of this Act), the total obligations of the Federal 
     Government to a State under such section 403(a)(1)--

       (I) for fiscal year 1996, shall be an amount equal to--

       (aa) the State family assistance grant; multiplied by
       (bb) \1/366\ of the number of days during the period that 
     begins on the date the Secretary of Health and Human Services 
     first receives from the State a plan described in section 
     402(a) of the Social Security Act (as added by the 
     amendment made by section 4103(a)(1) of this Act) and ends 
     on September 30, 1996; and

       (II) for fiscal year 1997, shall be an amount equal to the 
     lesser of--

       (aa) the amount (if any) by which the State family 
     assistance grant exceeds the total obligations of the Federal 
     Government to the State under part A of title IV of the 
     Social Security Act (as in effect on September 30, 1995) with 
     respect to expenditures in fiscal year 1997; or
       (bb) the State family assistance grant, multiplied by \1/
     365\ of the number of days during the period that begins on 
     October 1, 1996, or the date the Secretary of Health and 
     Human Services first receives from the State a plan described 
     in section 402(a) of the Social Security Act (as added by the 
     amendment made by section 4103(a)(1) of this Act), whichever 
     is later, and ends on September 30, 1997.
       (iii) Child care obligations excluded in determining 
     federal afdc obligations.--As used in this subparagraph, the 
     term ``obligations of the Federal Government to the State 
     under part A of title IV of the Social Security Act'' does 
     not include any obligation of the Federal Government with 
     respect to child care expenditures by the State.
       (C) Submission of state plan for fiscal year 1996 or 1997 
     deemed acceptance of grant limitations and formula and 
     termination of afdc entitlement.--The submission of a plan by 
     a State pursuant to subparagraph (A) is deemed to 
     constitute--
       (i) the State's acceptance of the grant reductions under 
     subparagraph (B) (including the formula for computing the 
     amount of the reduction); and
       (ii) the termination of any entitlement of any individual 
     or family to benefits or services under the State AFDC 
     program.
       (D) Definitions.--As used in this paragraph:
       (i) State afdc program.--The term ``State AFDC program'' 
     means the State program under parts A and F of title IV of 
     the Social Security Act (as in effect on September 30, 1995).
       (ii) State.--The term ``State'' means the 50 States and the 
     District of Columbia.
       (iii) State family assistance grant.--The term ``State 
     family assistance grant'' means the State family assistance 
     grant (as defined in section 403(a)(1)(B) of the Social 
     Security Act, as added by the amendment made by section 
     4103(a)(1) of this Act).
       (2) Claims, actions, and proceedings.--The amendments made 
     by this subtitle shall not apply with respect to--
       (A) powers, duties, functions, rights, claims, penalties, 
     or obligations applicable to aid, assistance, or services 
     provided before the effective date of this subtitle under the 
     provisions amended; and
       (B) administrative actions and proceedings commenced before 
     such date, or authorized before such date to be commenced, 
     under such provisions.
       (3) Closing out account for those programs terminated or 
     substantially modified by this subtitle.--In closing out 
     accounts, Federal and State officials may use scientifically 
     acceptable statistical sampling techniques. Claims made with 
     respect to State expenditures under a State plan approved 
     under part A of title IV of the Social Security Act (as in 
     effect on September 30, 1995) with respect to assistance or 
     services provided on or before September 30, 1995, shall be 
     treated as claims with respect to expenditures during fiscal 
     year 1995 for purposes of reimbursement even if payment 
     was made by a State on or after October 1, 1995. Each 
     State shall complete the filing of all claims under the 
     State plan (as so in effect) within 2 years after the date 
     of the enactment of this Act. The head of each Federal 
     department shall--
       (A) use the single audit procedure to review and resolve 
     any claims in connection with the close out of programs under 
     such State plans; and
       (B) reimburse States for any payments made for assistance 
     or services provided during a prior fiscal year from funds 
     for fiscal year 1995, rather than from funds authorized by 
     this subtitle.
       (4) Continuance in office of assistant secretary for family 
     support.--The individual who, on the day before the effective 
     date of this subtitle, is serving as Assistant Secretary for 
     Family Support within the Department of Health and Human 
     Services shall, until a successor is appointed to such 
     position--
       (A) continue to serve in such position; and
       (B) except as otherwise provided by law--
       (i) continue to perform the functions of the Assistant 
     Secretary for Family Support under section 417 of the Social 
     Security Act (as in effect before such effective date); and
       (ii) have the powers and duties of the Assistant Secretary 
     for Family Support under section 416 of the Social Security 
     Act (as in effect pursuant to the amendment made by section 
     4103(a)(1) of this Act).
       (c) Termination of Entitlement Under AFDC Program.--
     Effective October 1, 1996, no individual or family shall be 
     entitled to any benefits or services under any State plan 
     approved under part A or F of title IV of the Social Security 
     Act (as in effect on September 30, 1995).
                Subtitle B--Supplemental Security Income

     SEC. 4200. REFERENCE TO SOCIAL SECURITY ACT.

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

                  CHAPTER 1--ELIGIBILITY RESTRICTIONS

     SEC. 4201. DENIAL OF SSI BENEFITS FOR 10 YEARS TO INDIVIDUALS 
                   FOUND TO HAVE FRAUDULENTLY MISREPRESENTED 
                   RESIDENCE IN ORDER TO OBTAIN BENEFITS 
                   SIMULTANEOUSLY IN 2 OR MORE STATES.

       (a) In General.--Section 1611(e) (42 U.S.C. 1382(e)), as 
     amended by section 105(b)(4) of the Contract with America 
     Advancement Act of 1996, is amended by redesignating 
     paragraph (5) as paragraph (3) and by adding at the end the 
     following new paragraph:
       ``(4)(A) No person shall be considered an eligible 
     individual or eligible spouse for purposes of this title 
     during the 10-year period

[[Page H7862]]

     that begins on the date the person is convicted in Federal or 
     State court of having made a fraudulent statement or 
     representation with respect to the place of residence of the 
     person in order to receive assistance simultaneously from 2 
     or more States under programs that are funded under title IV, 
     title XIX, or the Food Stamp Act of 1977, or benefits in 2 or 
     more States under the supplemental security income program 
     under this title.
       ``(B) As soon as practicable after the conviction of a 
     person in a Federal or State court as described in 
     subparagraph (A), an official of such court shall notify the 
     Commissioner of such conviction.''.
       (b) Effective Date.--The amendment made by this section 
     shall take effect on the date of the enactment of this Act.

     SEC. 4202. DENIAL OF SSI BENEFITS FOR FUGITIVE FELONS AND 
                   PROBATION AND PAROLE VIOLATORS.

       (a) In General.--Section 1611(e) (42 U.S.C. 1382(e)), as 
     amended by section 4201(a) of this Act, is amended by adding 
     at the end the following new paragraph:
       ``(5) No person shall be considered an eligible individual 
     or eligible spouse for purposes of this title with respect to 
     any month if during such month the person is--
       ``(A) fleeing to avoid prosecution, or custody or 
     confinement after conviction, under the laws of the place 
     from which the person flees, for a crime, or an attempt to 
     commit a crime, which is a felony under the laws of the place 
     from which the person flees, or which, in the case of the 
     State of New Jersey, is a high misdemeanor under the laws of 
     such State; or
       ``(B) violating a condition of probation or parole imposed 
     under Federal or State law.''.
       (b) Exchange of Information.--Section 1611(e) (42 U.S.C. 
     1382(e)), as amended by section 4201(a) of this Act and 
     subsection (a) of this section, is amended by adding at the 
     end the following new paragraph:
       ``(6) Notwithstanding any other provision of law (other 
     than section 6103 of the Internal Revenue Code of 1986), the 
     Commissioner shall furnish any Federal, State, or local law 
     enforcement officer, upon the written request of the officer, 
     with the current address, Social Security number, and 
     photograph (if applicable) of any recipient of benefits under 
     this title, if the officer furnishes the Commissioner with 
     the name of the recipient, and other identifying information 
     as reasonably required by the Commissioner to establish the 
     unique identity of the recipient, and notifies the 
     Commissioner that--
       ``(A) the recipient--
       ``(i) is described in subparagraph (A) or (B) of paragraph 
     (5); or
       ``(ii) has information that is necessary for the officer to 
     conduct the officer's official duties; and
       ``(B) the location or apprehension of the recipient is 
     within the officer's official duties.''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.

     SEC. 4203. TREATMENT OF PRISONERS.

       (a) Implementation of Prohibition Against Payment of 
     Benefits to Prisoners.--
       (1) In general.--Section 1611(e)(1) (42 U.S.C. 1382(e)(1)) 
     is amended by adding at the end the following new 
     subparagraph:
       ``(I)(i) The Commissioner shall enter into an agreement, 
     with any interested State or local institution described in 
     clause (i) or (ii) of section 202(x)(1)(A) the primary 
     purpose of which is to confine individuals as described in 
     section 202(x)(1)(A), under which--
       ``(I) the institution shall provide to the Commissioner, on 
     a monthly basis and in a manner specified by the 
     Commissioner, the names, social security account numbers, 
     dates of birth, confinement commencement dates, and, to the 
     extent available to the institution, such other identifying 
     information concerning the inmates of the institution as the 
     Commissioner may require for the purpose of carrying out 
     paragraph (1); and
       ``(II) the Commissioner shall pay to any such institution, 
     with respect to each inmate of the institution who is 
     eligible for a benefit under this title for the month 
     preceding the first month throughout which such inmate is in 
     such institution and becomes ineligible for such benefit as a 
     result of the application of this subparagraph, $400 if the 
     institution furnishes the information described in subclause 
     (I) to the Commissioner within 30 days after the date such 
     individual becomes an inmate of such institution, or $200 if 
     the institution furnishes such information after 30 days 
     after such date but within 90 days after such date.
       ``(ii)(I) The provisions of section 552a of title 5, United 
     States Code, shall not apply to any agreement entered 
     into under clause (i) or to information exchanged pursuant 
     to such agreement.
       ``(II) The Commissioner is authorized to provide, on a 
     reimbursable basis, information obtained pursuant to 
     agreements entered into under clause (i) to any Federal or 
     federally-assisted cash, food, or medical assistance program 
     for eligibility purposes.
       ``(iii) The dollar amounts specified in clause (i)(II) 
     shall be reduced by 50 percent if the Commissioner is also 
     required to make a payment to the institution with respect to 
     the same individual under an agreement entered into under 
     section 202(x)(3)(B).
       ``(iv) Payments to institutions required by clause (i)(II) 
     shall be made from funds otherwise available for the payment 
     of benefits under this title and shall be treated as direct 
     spending for purposes of the Balanced Budget and Emergency 
     Deficit Control Act of 1985.''.
       (2) Conforming oasdi amendments.--Section 202(x)(3) (42 
     U.S.C. 402(x)(3)) is amended--
       (A) by inserting ``(A)'' after ``(3)''; and
       (B) by adding at the end the following new subparagraph:
       ``(B)(i) The Commissioner shall enter into an agreement, 
     with any interested State or local institution described in 
     clause (i) or (ii) of paragraph (1)(A) the primary purpose of 
     which is to confine individuals as described in paragraph 
     (1)(A), under which--
       ``(I) the institution shall provide to the Commissioner, on 
     a monthly basis and in a manner specified by the 
     Commissioner, the names, social security account numbers, 
     dates of birth, confinement commencement dates, and, to the 
     extent available to the institution, such other identifying 
     information concerning the individuals confined in the 
     institution as the Commissioner may require for the purpose 
     of carrying out paragraph (1); and
       ``(II) the Commissioner shall pay to any such institution, 
     with respect to each individual who is entitled to a benefit 
     under this title for the month preceding the first month 
     throughout which such individual is confined in such 
     institution as described in paragraph (1)(A), $400 if the 
     institution furnishes the information described in subclause 
     (I) to the Commissioner within 30 days after the date such 
     individual's confinement in such institution begins, or $200 
     if the institution furnishes such information after 30 days 
     after such date but within 90 days after such date.
       ``(ii)(I) The provisions of section 552a of title 5, United 
     States Code, shall not apply to any agreement entered into 
     under clause (i) or to information exchanged pursuant to such 
     agreement.
       ``(II) The Commissioner is authorized to provide, on a 
     reimbursable basis, information obtained pursuant to 
     agreements entered into under clause (i) to any Federal or 
     federally-assisted cash, food, or medical assistance program 
     for eligibility purposes.
       ``(iii) The dollar amounts specified in clause (i)(II) 
     shall be reduced by 50 percent if the Commissioner is also 
     required to make a payment to the institution with respect to 
     the same individual under an agreement entered into under 
     section 1611(e)(1)(I).
       ``(iv) There shall be transferred from the Federal Old-Age 
     and Survivors Insurance Trust Fund and the Federal Disability 
     Insurance Trust Fund, as appropriate, such sums as may be 
     necessary to enable the Commissioner to make payments to 
     institutions required by clause (i)(II). Sums so transferred 
     shall be treated as direct spending for purposes of the 
     Balanced Budget and Emergency Deficit Control Act of 1985 and 
     excluded from budget totals in accordance with section 13301 
     of the Budget Enforcement Act of 1990.''.
       (3) Effective date.--The amendments made by this subsection 
     shall apply to individuals whose period of confinement in an 
     institution commences on or after the first day of the 
     seventh month beginning after the month in which this Act is 
     enacted.
       (b) Elimination of OASDI Requirement That Confinement Stem 
     From Crime Punishable by Imprisonment for More Than 1 Year.--
       (1) In general.--Section 202(x)(1)(A) (42 U.S.C. 
     402(x)(1)(A)) is amended--
       (A) in the matter preceding clause (i), by striking 
     ``during'' and inserting ``throughout'';
       (B) in clause (i), by striking ``pursuant'' and all that 
     follows through ``imposed)''; and
       (C) in clause (ii)(I), by striking ``an offense punishable 
     by imprisonment for more than 1 year'' and inserting ``a 
     criminal offense''.
       (2) Effective date.--The amendments made by this subsection 
     shall be effective with respect to benefits payable for 
     months beginning more than 180 days after the date of the 
     enactment of this Act.
       (c) Study of Other Potential Improvements in the Collection 
     of Information Respecting Public Inmates.--
       (1) Study.--The Commissioner of Social Security shall 
     conduct a study of the desirability, feasibility, and cost 
     of--
       (A) establishing a system under which Federal, State, and 
     local courts would furnish to the Commissioner such 
     information respecting court orders by which individuals are 
     confined in jails, prisons, or other public penal, 
     correctional, or medical facilities as the Commissioner may 
     require for the purpose of carrying out sections 202(x) and 
     1611(e)(1) of the Social Security Act; and
       (B) requiring that State and local jails, prisons, and 
     other institutions that enter into agreements with the 
     Commissioner under section 202(x)(3)(B) or 1611(e)(1)(I) of 
     the Social Security Act furnish the information required by 
     such agreements to the Commissioner by means of an electronic 
     or other sophisticated data exchange system.
       (2) Report.--Not later than 1 year after the date of the 
     enactment of this Act, the Commissioner of Social Security 
     shall submit a report on the results of the study conducted 
     pursuant to this subsection to the Committee on Finance of 
     the Senate and the Committee on Ways and Means of the House 
     of Representatives.
       (d) Additional Report to Congress.--Not later than October 
     1, 1998, the Commissioner of Social Security shall provide to 
     the Committee on Finance of the Senate and the Committee on 
     Ways and Means of the House of Representatives a list of the 
     institutions that are and are not providing information to 
     the Commissioner under sections 202(x)(3)(B) and 
     1611(e)(1)(I) of the Social Security Act (as added by this 
     section).

[[Page H7863]]

     SEC. 4204. EFFECTIVE DATE OF APPLICATION FOR BENEFITS.

       (a) In General.--Subparagraphs (A) and (B) of section 
     1611(c)(7) (42 U.S.C. 1382(c)(7)) are amended to read as 
     follows:
       ``(A) the first day of the month following the date such 
     application is filed, or
       ``(B) the first day of the month following the date such 
     individual becomes eligible for such benefits with respect to 
     such application.''.
       (b) Special Rule Relating to Emergency Advance Payments.--
     Section 1631(a)(4)(A) (42 U.S.C. 1383(a)(4)(A)) is amended--
       (1) by inserting ``for the month following the date the 
     application is filed'' after ``is presumptively eligible for 
     such benefits''; and
       (2) by inserting ``, which shall be repaid through 
     proportionate reductions in such benefits over a period of 
     not more than 6 months'' before the semicolon.
       (c) Conforming Amendments.--
       (1) Section 1614(b) (42 U.S.C. 1382c(b)) is amended by 
     striking ``at the time the application or request is 
     filed'' and inserting ``on the first day of the month 
     following the date the application or request is filed''.
       (2) Section 1631(g)(3) (42 U.S.C. 1382j(g)(3)) is amended 
     by inserting ``following the month'' after ``beginning with 
     the month''.
       (d) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     apply to applications for benefits under title XVI of the 
     Social Security Act filed on or after the date of the 
     enactment of this Act, without regard to whether regulations 
     have been issued to implement such amendments.
       (2) Benefits under title xvi.--For purposes of this 
     subsection, the term ``benefits under title XVI of the Social 
     Security Act'' includes supplementary payments pursuant to an 
     agreement for Federal administration under section 1616(a) of 
     the Social Security Act, and payments pursuant to an 
     agreement entered into under section 212(b) of Public Law 93-
     66.

               CHAPTER 2--BENEFITS FOR DISABLED CHILDREN

     SEC. 4211. DEFINITION AND ELIGIBILITY RULES.

       (a) Definition of Childhood Disability.--Section 1614(a)(3) 
     (42 U.S.C. 1382c(a)(3)), as amended by section 105(b)(1) of 
     the Contract with America Advancement Act of 1996, is 
     amended--
       (1) in subparagraph (A), by striking ``An individual'' and 
     inserting ``Except as provided in subparagraph (C), an 
     individual'';
       (2) in subparagraph (A), by striking ``(or, in the case of 
     an individual under the age of 18, if he suffers from any 
     medically determinable physical or mental impairment of 
     comparable severity)'';
       (3) by redesignating subparagraphs (C) through (I) as 
     subparagraphs (D) through (J), respectively;
       (4) by inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C)(i) An individual under the age of 18 shall be 
     considered disabled for the purposes of this title if that 
     individual has a medically determinable physical or mental 
     impairment, which results in marked and severe functional 
     limitations, and which can be expected to result in death or 
     which has lasted or can be expected to last for a continuous 
     period of not less than 12 months.
       ``(ii) The Commissioner shall ensure that the combined 
     effects of all physical or mental impairments of an 
     individual are taken into account in determining whether an 
     individual is disabled in accordance with clause (i).
       ``(iii) The Commissioner shall ensure that the regulations 
     prescribed under this subparagraph provide for the evaluation 
     of children who cannot be tested because of their young age.
       ``(iv) Notwithstanding the preceding provisions of this 
     subparagraph, no individual under the age of 18 who engages 
     in substantial gainful activity (determined in accordance 
     with regulations prescribed pursuant to subparagraph (E)) may 
     be considered to be disabled.''; and
       (5) in subparagraph (F), as redesignated by paragraph (3), 
     by striking ``(D)'' and inserting ``(E)''.
       (b) Changes to Childhood SSI Regulations.--
       (1) Modification to medical criteria for evaluation of 
     mental and emotional disorders.--The Commissioner of Social 
     Security shall modify sections 112.00C.2. and 112.02B.2.c.(2) 
     of appendix 1 to subpart P of part 404 of title 20, Code of 
     Federal Regulations, to eliminate references to maladaptive 
     behavior in the domain of personal/behavorial function.
       (2) Discontinuance of individualized functional 
     assessment.--The Commissioner of Social Security shall 
     discontinue the individualized functional assessment for 
     children set forth in sections 416.924d and 416.924e of title 
     20, Code of Federal Regulations.
       (c) Medical Improvement Review Standard as it Applies to 
     Individuals Under the Age of 18.--Section 1614(a)(4) (42 
     U.S.C. 1382(a)(4)) is amended--
       (1) by redesignating subclauses (I) and (II) of clauses (i) 
     and (ii) of subparagraph (B) as items (aa) and (bb), 
     respectively;
       (2) by redesignating clauses (i) and (ii) of subparagraphs 
     (A) and (B) as subclauses (I) and (II), respectively;
       (3) by redesignating subparagraphs (A) through (C) as 
     clauses (i) through (iii), respectively;
       (4) by inserting before clause (i) (as redesignated by 
     paragraph (3)) the following new subparagraph:
       ``(A) in the case of an individual who is age 18 or older--
     '';
       (5) by inserting after and below subparagraph (A)(iii) (as 
     so redesignated) the following new subparagraph:
       ``(B) in the case of an individual who is under the age of 
     18--
       ``(i) substantial evidence which demonstrates that there 
     has been medical improvement in the individual's impairment 
     or combination of impairments, and that such impairment or 
     combination of impairments no longer results in marked and 
     severe functional limitations; or
       ``(ii) substantial evidence which demonstrates that, as 
     determined on the basis of new or improved diagnostic 
     techniques or evaluations, the individual's impairment or 
     combination of impairments, is not as disabling as it was 
     considered to be at the time of the most recent prior 
     decision that the individual was under a disability or 
     continued to be under a disability, and such impairment or 
     combination of impairments does not result in marked and 
     severe functional limitations; or'';
       (6) by redesignating subparagraph (D) as subparagraph (C) 
     and by inserting in such subparagraph ``in the case of any 
     individual,'' before ``substantial evidence''; and
       (7) in the first sentence following subparagraph (C) (as 
     redesignated by paragraph (6)), by--
       (A) inserting ``(i)'' before ``to restore''; and
       (B) inserting ``, or (ii) in the case of an individual 
     under the age of 18, to eliminate or improve the individual's 
     impairment or combination of impairments so that it no longer 
     results in marked and severe functional limitations'' 
     immediately before the period.
       (d) Effective Dates, Etc.--
       (1) Effective dates.--
       (A) Subsections (a) and (b).--
       (i) In general.--The provisions of, and amendments made by, 
     subsections (a) and (b) shall apply to any individual who 
     applies for, or whose claim is finally adjudicated with 
     respect to, benefits under title XVI of the Social Security 
     Act on or after the date of the enactment of this Act, 
     without regard to whether regulations have been issued to 
     implement such provisions and amendments.
       (ii) Determination of final adjudication.--For purposes of 
     clause (i), no individual's claim with respect to such 
     benefits may be considered to be finally adjudicated before 
     such date of enactment if, on or after such date, there is 
     pending a request for either administrative or judicial 
     review with respect to such claim that has been denied in 
     whole, or there is pending, with respect to such claim, 
     readjudication by the Commissioner of Social Security 
     pursuant to relief in a class action or implementation by the 
     Commissioner of a court remand order.
       (B) Subsection (c).--The amendments made by subsection (c) 
     shall apply with respect to benefits under title XVI of the 
     Social Security Act for months beginning on or after the date 
     of the enactment of this Act, without regard to whether 
     regulations have been issued to implement such amendments.
       (2) Application to current recipients.--
       (A) Eligibility redeterminations.--During the period 
     beginning on the date of the enactment of this Act and ending 
     on the date which is 1 year after such date of enactment, 
     the Commissioner of Social Security shall redetermine the 
     eligibility of any individual under age 18 who is eligible 
     for supplemental security income benefits by reason of 
     disability under title XVI of the Social Security Act as 
     of the date of the enactment of this Act and whose 
     eligibility for such benefits may terminate by reason of 
     the provisions of, or amendments made by, subsections (a) 
     and (b). With respect to any redetermination under this 
     subparagraph--
       (i) section 1614(a)(4) of the Social Security Act (42 
     U.S.C. 1382c(a)(4)) shall not apply;
       (ii) the Commissioner of Social Security shall apply the 
     eligibility criteria for new applicants for benefits under 
     title XVI of such Act;
       (iii) the Commissioner shall give such redetermination 
     priority over all continuing eligibility reviews and other 
     reviews under such title; and
       (iv) such redetermination shall be counted as a review or 
     redetermination otherwise required to be made under section 
     208 of the Social Security Independence and Program 
     Improvements Act of 1994 or any other provision of title XVI 
     of the Social Security Act.
       (B) Grandfather provision.--The provisions of, and 
     amendments made by, subsections (a) and (b), and the 
     redetermination under subparagraph (A), shall only apply with 
     respect to the benefits of an individual described in 
     subparagraph (A) for months beginning on or after the date of 
     the redetermination with respect to such individual.
       (C) Notice.--Not later than January 1, 1997, the 
     Commissioner of Social Security shall notify an individual 
     described in subparagraph (A) of the provisions of this 
     paragraph.
       (3) Report.--The Commissioner of Social Security shall 
     report to the Congress regarding the progress made in 
     implementing the provisions of, and amendments made by, this 
     section on child disability evaluations not later than 180 
     days after the date of the enactment of this Act.
       (4) Regulations.--Notwithstanding any other provision of 
     law, the Commissioner of Social Security shall submit for 
     review to the committees of jurisdiction in the Congress any 
     final regulation pertaining to the eligibility of individuals 
     under age 18 for benefits under title XVI of the Social 
     Security Act at least 45 days before the effective

[[Page H7864]]

     date of such regulation. The submission under this paragraph 
     shall include supporting documentation providing a cost 
     analysis, workload impact, and projections as to how the 
     regulation will effect the future number of recipients under 
     such title.
       (5) Benefits under title xvi.--For purposes of this 
     subsection, the term ``benefits under title XVI of the Social 
     Security Act'' includes supplementary payments pursuant to an 
     agreement for Federal administration under section 1616(a) of 
     the Social Security Act, and payments pursuant to an 
     agreement entered into under section 212(b) of Public Law 93-
     66.

     SEC. 4212. ELIGIBILITY REDETERMINATIONS AND CONTINUING 
                   DISABILITY REVIEWS.

       (a) Continuing Disability Reviews Relating to Certain 
     Children.--Section 1614(a)(3)(H) (42 U.S.C. 1382c(a)(3)(H)), 
     as redesignated by section 4211(a)(3) of this Act, is 
     amended--
       (1) by inserting ``(i)'' after ``(H)''; and
       (2) by adding at the end the following new clause:
       ``(ii)(I) Not less frequently than once every 3 years, the 
     Commissioner shall review in accordance with paragraph (4) 
     the continued eligibility for benefits under this title of 
     each individual who has not attained 18 years of age and is 
     eligible for such benefits by reason of an impairment (or 
     combination of impairments) which is likely to improve (or, 
     at the option of the Commissioner, which is unlikely to 
     improve).
       ``(II) A representative payee of a recipient whose case is 
     reviewed under this clause shall present, at the time of 
     review, evidence demonstrating that the recipient is, and has 
     been, receiving treatment, to the extent considered medically 
     necessary and available, of the condition which was the basis 
     for providing benefits under this title.
       ``(III) If the representative payee refuses to comply 
     without good cause with the requirements of subclause (II), 
     the Commissioner of Social Security shall, if the 
     Commissioner determines it is in the best interest of the 
     individual, promptly suspend payment of benefits to the 
     representative payee, and provide for payment of benefits 
     to an alternative representative payee of the individual 
     or, if the interest of the individual under this title 
     would be served thereby, to the individual.
       ``(IV) Subclause (II) shall not apply to the representative 
     payee of any individual with respect to whom the Commissioner 
     determines such application would be inappropriate or 
     unnecessary. In making such determination, the Commissioner 
     shall take into consideration the nature of the individual's 
     impairment (or combination of impairments). Section 1631(c) 
     shall not apply to a finding by the Commissioner that the 
     requirements of subclause (II) should not apply to an 
     individual's representative payee.''.
       (b) Disability Eligibility Redeterminations Required for 
     SSI Recipients Who Attain 18 Years of Age.--
       (1) In general.--Section 1614(a)(3)(H) (42 U.S.C. 
     1382c(a)(3)(H)), as amended by subsection (a) of this 
     section, is amended by adding at the end the following new 
     clause:
       ``(iii) If an individual is eligible for benefits under 
     this title by reason of disability for the month preceding 
     the month in which the individual attains the age of 18 
     years, the Commissioner shall redetermine such eligibility--
       ``(I) during the 1-year period beginning on the 
     individual's 18th birthday; and
       ``(II) by applying the criteria used in determining the 
     initial eligibility for applicants who are age 18 or older.

     With respect to a redetermination under this clause, 
     paragraph (4) shall not apply and such redetermination shall 
     be considered a substitute for a review or redetermination 
     otherwise required under any other provision of this 
     subparagraph during that 1-year period.''.
       (2) Conforming repeal.--Section 207 of the Social Security 
     Independence and Program Improvements Act of 1994 (42 U.S.C. 
     1382 note; 108 Stat. 1516) is hereby repealed.
       (c) Continuing Disability Review Required for Low Birth 
     Weight Babies.--Section 1614(a)(3)(H) (42 U.S.C. 
     1382c(a)(3)(H)), as amended by subsections (a) and (b) of 
     this section, is amended by adding at the end the following 
     new clause:
       ``(iv)(I) Not later than 12 months after the birth of an 
     individual, the Commissioner shall review in accordance with 
     paragraph (4) the continuing eligibility for benefits under 
     this title by reason of disability of such individual whose 
     low birth weight is a contributing factor material to the 
     Commissioner's determination that the individual is disabled.
       ``(II) A review under subclause (I) shall be considered a 
     substitute for a review otherwise required under any other 
     provision of this subparagraph during that 12-month period.
       ``(III) A representative payee of a recipient whose case is 
     reviewed under this clause shall present, at the time of 
     review, evidence demonstrating that the recipient is, and has 
     been, receiving treatment, to the extent considered medically 
     necessary and available, of the condition which was the basis 
     for providing benefits under this title.
       ``(IV) If the representative payee refuses to comply 
     without good cause with the requirements of subclause (III), 
     the Commissioner of Social Security shall, if the 
     Commissioner determines it is in the best interest of the 
     individual, promptly suspend payment of benefits to the 
     representative payee, and provide for payment of benefits to 
     an alternative representative payee of the individual or, if 
     the interest of the individual under this title would be 
     served thereby, to the individual.
       ``(V) Subclause (III) shall not apply to the representative 
     payee of any individual with respect to whom the Commissioner 
     determines such application would be inappropriate or 
     unnecessary. In making such determination, the Commissioner 
     shall take into consideration the nature of the individual's 
     impairment (or combination of impairments). Section 1631(c) 
     shall not apply to a finding by the Commissioner that the 
     requirements of subclause (III) should not apply to an 
     individual's representative payee.''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to benefits for months beginning on or after the 
     date of the enactment of this Act, without regard to whether 
     regulations have been issued to implement such amendments.

     SEC. 4213. ADDITIONAL ACCOUNTABILITY REQUIREMENTS.

       (a) Disposal of Resources for Less Than Fair Market 
     Value.--
       (1) In general.--Section 1613(c) (42 U.S.C. 1382b(c)) is 
     amended to read as follows:

        ``Disposal of Resources for Less Than Fair Market Value

       ``(c)(1)(A)(i) If an individual who has not attained 18 
     years of age (or any person acting on such individual's 
     behalf) disposes of resources of the individual for less than 
     fair market value on or after the look-back date specified in 
     clause (ii)(I), the individual is ineligible for benefits 
     under this title for months during the period beginning on 
     the date specified in clause (iii) and equal to the number of 
     months specified in clause (iv).
       ``(ii)(I) The look-back date specified in this subclause is 
     a date that is 36 months before the date specified in 
     subclause (II).
       ``(II) The date specified in this subclause is the date on 
     which the individual applies for benefits under this title 
     or, if later, the date on which the disposal of the 
     individual's resources for less than fair market value 
     occurs.
       ``(iii) The date specified in this clause is the first day 
     of the first month that follows the month in which the 
     individual's resources were disposed of for less than fair 
     market value and that does not occur in any other period of 
     ineligibility under this paragraph.
       ``(iv) The number of months of ineligibility under this 
     clause for an individual shall be equal to--
       ``(I) the total, cumulative uncompensated value of all the 
     individual's resources so disposed of on or after the look-
     back date specified in clause (ii)(I), divided by
       ``(II) the amount of the maximum monthly benefit payable 
     under section 1611(b) to an eligible individual for the month 
     in which the date specified in clause (ii)(II) occurs.
       ``(B) An individual shall not be ineligible for benefits 
     under this title by reason of subparagraph (A) if the 
     Commissioner determines that--
       ``(i) the individual intended to dispose of the resources 
     at fair market value;
       ``(ii) the resources were transferred exclusively for a 
     purpose other than to qualify for benefits under this title;
       ``(iii) all resources transferred for less than fair market 
     value have been returned to the individual; or
       ``(iv) the denial of eligibility would work an undue 
     hardship on the individual (as determined on the basis of 
     criteria established by the Commissioner in regulations).
       ``(C) For purposes of this paragraph, in the case of a 
     resource held by an individual in common with another person 
     or persons in a joint tenancy, tenancy in common, or similar 
     arrangement, the resource (or the affected portion of such 
     resource) shall be considered to be disposed of by such 
     individual when any action is taken, either by such 
     individual or by any other person, that reduces or eliminates 
     such individual's ownership or control of such resource.
       ``(D)(i) Notwithstanding subparagraph (A), this subsection 
     shall not apply to a transfer of a resource to a trust if the 
     portion of the trust attributable to such resource is 
     considered a resource available to the individual pursuant to 
     subsection (e)(3) (or would be so considered, but for the 
     application of subsection (e)(4)).
       ``(ii) In the case of a trust established by an individual 
     (within the meaning of subsection (e)(2)(A)), if from such 
     portion of the trust (if any) that is considered a resource 
     available to the individual pursuant to subsection (e)(3) (or 
     would be so considered but for the application of subsection 
     (e)(2)) or the residue of such portion upon the termination 
     of the trust--
       ``(I) there is made a payment other than to or for the 
     benefit of the individual, or
       ``(II) no payment could under any circumstance be made to 
     the individual,

     then the payment described in subclause (I) or the 
     foreclosure of payment described in subclause (II) shall be 
     considered a disposal of resources by the individual subject 
     to this subsection, as of the date of such payment or 
     foreclosure, respectively.
       ``(2)(A) At the time an individual (and the individual's 
     eligible spouse, if any) applies for benefits under this 
     title, and at the time the eligibility of an individual (and 
     such spouse, if any) for such benefits is redetermined, the 
     Commissioner of Social Security shall--
       ``(i) inform such individual of the provisions of paragraph 
     (1) providing for a period

[[Page H7865]]

     of ineligibility for benefits under this title for 
     individuals who make certain dispositions of resources for 
     less than fair market value, and inform such individual that 
     information obtained pursuant to clause (ii) will be made 
     available to the State agency administering a State plan 
     approved under title XIX (as provided in subparagraph (B)); 
     and
       ``(ii) obtain from such individual information which may be 
     used in determining whether or not a period of ineligibility 
     for such benefits would be required by reason of paragraph 
     (1).
       ``(B) The Commissioner of Social Security shall make the 
     information obtained under subparagraph (A)(ii) available, on 
     request, to any State agency administering a State plan 
     approved under title XIX.
       ``(3) For purposes of this subsection--
       ``(A) the term `trust' includes any legal instrument or 
     device that is similar to a trust; and
       ``(B) the term `benefits under this title' includes 
     supplementary payments pursuant to an agreement for Federal 
     administration under section 1616(a), and payments pursuant 
     to an agreement entered into under section 212(b) of Public 
     Law 93-66.''.
       (2) Effective date.--The amendment made by this subsection 
     shall be effective with respect to transfers that occur at 
     least 90 days after the date of the enactment of this Act.
       (b) Treatment of Assets Held in Trust.--
       (1) Treatment as resource.--Section 1613 (42 U.S.C. 1382) 
     is amended by adding at the end the following new subsection:

                                ``Trusts

       ``(e)(1) In determining the resources of an individual who 
     has not attained 18 years of age, the provisions of paragraph 
     (3) shall apply to a trust established by such individual.
       ``(2)(A) For purposes of this subsection, an individual 
     shall be considered to have established a trust if any assets 
     of the individual were transferred to the trust.
       ``(B) In the case of an irrevocable trust to which the 
     assets of an individual and the assets of any other person or 
     persons were transferred, the provisions of this subsection 
     shall apply to the portion of the trust attributable to the 
     assets of the individual.
       ``(C) This subsection shall apply without regard to--
       ``(i) the purposes for which the trust is established;
       ``(ii) whether the trustees have or exercise any discretion 
     under the trust;
       ``(iii) any restrictions on when or whether distributions 
     may be made from the trust; or
       ``(iv) any restrictions on the use of distributions from 
     the trust.
       ``(3)(A) In the case of a revocable trust, the corpus of 
     the trust shall be considered a resource available to the 
     individual.
       ``(B) In the case of an irrevocable trust, if there are any 
     circumstances under which payment from the trust could be 
     made to or for the benefit of the individual, the portion of 
     the corpus from which payment to or for the benefit of the 
     individual could be made shall be considered a resource 
     available to the individual.
       ``(4) The Commissioner may waive the application of this 
     subsection with respect to any individual if the Commissioner 
     determines, on the basis of criteria prescribed in 
     regulations, that such application would work an undue 
     hardship on such individual.
       ``(5) For purposes of this subsection--
       ``(A) the term `trust' includes any legal instrument or 
     device that is similar to a trust;
       ``(B) the term `corpus' means all property and other 
     interests held by the trust, including accumulated earnings 
     and any other addition to such trust after its establishment 
     (except that such term does not include any such earnings or 
     addition in the month in which such earnings or addition is 
     credited or otherwise transferred to the trust);
       ``(C) the term `asset' includes any income or resource of 
     the individual, including--
       ``(i) any income otherwise excluded by section 1612(b);
       ``(ii) any resource otherwise excluded by this section; and
       ``(iii) any other payment or property that the individual 
     is entitled to but does not receive or have access to because 
     of action by--
       ``(I) such individual;
       ``(II) a person or entity (including a court) with legal 
     authority to act in place of, or on behalf of, such 
     individual; or
       ``(III) a person or entity (including a court) acting at 
     the direction of, or upon the request of, such individual; 
     and
       ``(D) the term `benefits under this title' includes 
     supplementary payments pursuant to an agreement for Federal 
     administration under section 1616(a), and payments pursuant 
     to an agreement entered into under section 212(b) of Public 
     Law 93-66.''.
       (2) Treatment as income.--Section 1612(a)(2) (42 U.S.C. 
     1382a(a)(2)) is amended--
       (A) by striking ``and'' at the end of subparagraph (E);
       (B) by striking the period at the end of subparagraph (F) 
     and inserting ``; and''; and
       (C) by adding at the end the following new subparagraph:
       ``(G) any earnings of, and additions to, the corpus of a 
     trust (as defined in section 1613(f)) established by an 
     individual (within the meaning of section 1613(e)(2)(A)) and 
     of which such individual is a beneficiary (other than a trust 
     to which section 1613(e)(4) applies), except that in the case 
     of an irrevocable trust, there shall exist circumstances 
     under which payment from such earnings or additions could be 
     made to, or for the benefit of, such individual.''.
       (3) Effective date.--The amendments made by this subsection 
     shall take effect on the date which is 90 days after the date 
     of the enactment of this Act, and shall apply to trusts 
     established on or after such date.
       (c) Requirement To Establish Account.--
       (1) In general.--Section 1631(a)(2) (42 U.S.C. 1383(a)(2)) 
     is amended--
       (A) by redesignating subparagraphs (F) and (G) as 
     subparagraphs (G) and (H), respectively; and
       (B) by inserting after subparagraph (E) the following new 
     subparagraph:
       ``(F)(i)(I) Each representative payee of an eligible 
     individual under the age of 18 who is eligible for the 
     payment of benefits described in subclause (II) shall 
     establish on behalf of such individual an account in a 
     financial institution into which such benefits shall be paid, 
     and shall thereafter maintain such account for use in 
     accordance with clause (ii).
       ``(II) Benefits described in this subclause are past-due 
     monthly benefits under this title (which, for purposes of 
     this subclause, include State supplementary payments made by 
     the Commissioner pursuant to an agreement under section 1616 
     or section 212(b) of Public Law 93-66) in an amount (after 
     any withholding by the Commissioner for reimbursement to a 
     State for interim assistance under subsection (g)) that 
     exceeds the product of--
       ``(aa) 6, and
       ``(bb) the maximum monthly benefit payable under this title 
     to an eligible individual.
       ``(ii)(I) A representative payee shall use funds in the 
     account established under clause (i) to pay for allowable 
     expenses described in subclause (II).
       ``(II) An allowable expense described in this subclause is 
     an expense for--
       ``(aa) education or job skills training;
       ``(bb) personal needs assistance;
       ``(cc) special equipment;
       ``(dd) housing modification;
       ``(ee) medical treatment;
       ``(ff) therapy or rehabilitation; or
       ``(gg) any other item or service that the Commissioner 
     determines to be appropriate;

     provided that such expense benefits such individual and, in 
     the case of an expense described in item (bb), (cc), (dd), 
     (ff), or (gg), is related to the impairment (or combination 
     of impairments) of such individual.
       ``(III) The use of funds from an account established under 
     clause (i) in any manner not authorized by this clause--
       ``(aa) by a representative payee shall be considered a 
     misapplication of benefits for all purposes of this 
     paragraph, and any representative payee who knowingly 
     misapplies benefits from such an account shall be liable to 
     the Commissioner in an amount equal to the total amount of 
     such benefits; and
       ``(bb) by an eligible individual who is his or her own 
     payee shall be considered a misapplication of benefits for 
     all purposes of this paragraph and the total amount of such 
     benefits so used shall be considered to be the uncompensated 
     value of a disposed resource and shall be subject to the 
     provisions of section 1613(c).
       ``(IV) This clause shall continue to apply to funds in the 
     account after the child has reached age 18, regardless of 
     whether benefits are paid directly to the beneficiary or 
     through a representative payee.
       ``(iii) The representative payee may deposit into the 
     account established pursuant to clause (i)--
       ``(I) past-due benefits payable to the eligible individual 
     in an amount less than that specified in clause (i)(II), and
       ``(II) any other funds representing an underpayment under 
     this title to such individual, provided that the amount of 
     such underpayment is equal to or exceeds the maximum monthly 
     benefit payable under this title to an eligible individual.
       ``(iv) The Commissioner of Social Security shall establish 
     a system for accountability monitoring whereby such 
     representative payee shall report, at such time and in such 
     manner as the Commissioner shall require, on activity 
     respecting funds in the account established pursuant to 
     clause (i).''.
       (2) Exclusion from resources.--Section 1613(a) (42 U.S.C. 
     1382b(a)) is amended--
       (A) by striking ``and'' at the end of paragraph (10);
       (B) by striking the period at the end of paragraph (11) and 
     inserting ``; and''; and
       (C) by inserting after paragraph (11) the following new 
     paragraph:
       ``(12) any account, including accrued interest or other 
     earnings thereon, established and maintained in accordance 
     with section 1631(a)(2)(F).''.
       (3) Exclusion from income.--Section 1612(b) (42 U.S.C. 
     1382a(b)) is amended--
       (A) by striking ``and'' at the end of paragraph (19);
       (B) by striking the period at the end of paragraph (20) and 
     inserting ``; and''; and
       (C) by adding at the end the following new paragraph:
       ``(21) the interest or other earnings on any account 
     established and maintained in accordance with section 
     1631(a)(2)(F).''.
       (4) Effective date.--The amendments made by this subsection 
     shall apply to payments made after the date of the enactment 
     of this Act.

     SEC. 4214. REDUCTION IN CASH BENEFITS PAYABLE TO 
                   INSTITUTIONALIZED INDIVIDUALS WHOSE MEDICAL 
                   COSTS ARE COVERED BY PRIVATE INSURANCE.

       (a) In General.--Section 1611(e)(1)(B) (42 U.S.C. 
     1382(e)(1)(B)) is amended--

[[Page H7866]]

       (1) by striking ``title XIX, or'' and inserting ``title 
     XIX,''; and
       (2) by inserting ``or, in the case of an eligible 
     individual under the age of 18, receiving payments (with 
     respect to such individual) under any health insurance policy 
     issued by a private provider of such insurance'' after 
     ``section 1614(f)(2)(B),''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to benefits for months beginning 90 or more days 
     after the date of the enactment of this Act, without regard 
     to whether regulations have been issued to implement such 
     amendments.

     SEC. 4215. REGULATIONS.

       Within 3 months after the date of the enactment of this 
     Act, the Commissioner of Social Security shall prescribe such 
     regulations as may be necessary to implement the amendments 
     made by this chapter.

              CHAPTER 3--ADDITIONAL ENFORCEMENT PROVISIONS

     SEC. 4221. INSTALLMENT PAYMENT OF LARGE PAST-DUE SUPPLEMENTAL 
                   SECURITY INCOME BENEFITS.

       (a) In General.--Section 1631(a) (42 U.S.C. 1383) is 
     amended by adding at the end the following new paragraph:
       ``(10)(A) If an individual is eligible for past-due monthly 
     benefits under this title in an amount that (after any 
     withholding for reimbursement to a State for interim 
     assistance under subsection (g)) equals or exceeds the 
     product of--
       ``(i) 12, and
       ``(ii) the maximum monthly benefit payable under this title 
     to an eligible individual (or, if appropriate, to an eligible 
     individual and eligible spouse),

     then the payment of such past-due benefits (after any such 
     reimbursement to a State) shall be made in installments as 
     provided in subparagraph (B).
       ``(B)(i) The payment of past-due benefits subject to this 
     subparagraph shall be made in not to exceed 3 installments 
     that are made at 6-month intervals.
       ``(ii) Except as provided in clause (iii), the amount of 
     each of the first and second installments may not exceed an 
     amount equal to the product of clauses (i) and (ii) of 
     subparagraph (A).
       ``(iii) In the case of an individual who has--
       ``(I) outstanding debt attributable to--
       ``(aa) food,
       ``(bb) clothing,
       ``(cc) shelter, or
       ``(dd) medically necessary services, supplies or equipment, 
     or medicine; or
       ``(II) current expenses or expenses anticipated in the near 
     term attributable to--
       ``(aa) medically necessary services, supplies or equipment, 
     or medicine, or
       ``(bb) the purchase of a home, and

     such debt or expenses are not subject to reimbursement by a 
     public assistance program, the Secretary under title XVIII, a 
     State plan approved under title XIX, or any private entity 
     legally liable to provide payment pursuant to an insurance 
     policy, pre-paid plan, or other arrangement, the limitation 
     specified in clause (ii) may be exceeded by an amount equal 
     to the total of such debt and expenses.
       ``(C) This paragraph shall not apply to any individual who, 
     at the time of the Commissioner's determination that such 
     individual is eligible for the payment of past-due monthly 
     benefits under this title--
       ``(i) is afflicted with a medically determinable impairment 
     that is expected to result in death within 12 months; or
       ``(ii) is ineligible for benefits under this title and the 
     Commissioner determines that such individual is likely to 
     remain ineligible for the next 12 months.
       ``(D) For purposes of this paragraph, the term `benefits 
     under this title' includes supplementary payments pursuant to 
     an agreement for Federal administration under section 
     1616(a), and payments pursuant to an agreement entered into 
     under section 212(b) of Public Law 93-66.''.
       (b) Conforming Amendment.--Section 1631(a)(1) (42 U.S.C. 
     1383(a)(1)) is amended by inserting ``(subject to paragraph 
     (10))'' immediately before ``in such installments''.
       (c) Effective Date.--
       (1) In general.--The amendments made by this section are 
     effective with respect to past-due benefits payable under 
     title XVI of the Social Security Act after the third month 
     following the month in which this Act is enacted.
       (2) Benefits payable under title xvi.--For purposes of this 
     subsection, the term ``benefits payable under title XVI of 
     the Social Security Act'' includes supplementary payments 
     pursuant to an agreement for Federal administration under 
     section 1616(a) of the Social Security Act, and payments 
     pursuant to an agreement entered into under section 212(b) of 
     Public Law 93-66.

     SEC. 4222. RECOVERY OF SUPPLEMENTAL SECURITY INCOME 
                   OVERPAYMENTS FROM SOCIAL SECURITY BENEFITS.

       (a) In General.--Part A of title XI is amended by adding at 
     the end the following new section:


      ``RECOVERY OF SSI OVERPAYMENTS FROM SOCIAL SECURITY BENEFITS

       ``Sec. 1146. (a) In General.--Whenever the Commissioner of 
     Social Security determines that more than the correct amount 
     of any payment has been made to any person under the 
     supplemental security income program authorized by title XVI, 
     and the Commissioner is unable to make proper adjustment or 
     recovery of the amount so incorrectly paid as provided in 
     section 1631(b), the Commissioner (notwithstanding section 
     207) may recover the amount incorrectly paid by decreasing 
     any amount which is payable under the Federal Old-Age and 
     Survivors Insurance program or the Federal Disability 
     Insurance program authorized by title II to that person or 
     that person's estate.
       ``(b) No Effect on SSI Benefit Eligibility or Amount.--
     Notwithstanding subsections (a) and (b) of section 1611, in 
     any case in which the Commissioner takes action in accordance 
     with subsection (a) to recover an overpayment from any 
     person, neither that person, nor any individual whose 
     eligibility or benefit amount is determined by considering 
     any part of that person's income, shall, as a result of such 
     action--
       ``(1) become eligible under the program of supplemental 
     security income benefits under title XVI, or
       ``(2) if such person or individual is already so eligible, 
     become eligible for increased benefits thereunder.
       ``(c) Program Under Title XVI.--For purposes of this 
     section, the term `supplemental security income program 
     authorized by title XVI' includes supplementary payments 
     pursuant to an agreement for Federal administration under 
     section 1616(a), and payments pursuant to an agreement 
     entered into under section 212(b) of Public Law 93-66.''.
       (b) Conforming Amendments.--
       (1) Section 204 (42 U.S.C. 404) is amended by adding at the 
     end the following new subsection:
       ``(g) For payments which are adjusted or withheld to 
     recover an overpayment of supplemental security income 
     benefits paid under title XVI (including State supplementary 
     payments which were paid under an agreement pursuant to 
     section 1616(a) or section 212(b) of Public Law 93-66), see 
     section 1146.''.
       (2) Section 1631(b) is amended by adding at the end the 
     following new paragraph:
       ``(5) For the recovery of overpayments of benefits under 
     this title from benefits payable under title II, see section 
     1146.''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act 
     and shall apply to overpayments outstanding on or after such 
     date.

     SEC. 4223. REGULATIONS.

       Within 3 months after the date of the enactment of this 
     Act, the Commissioner of Social Security shall prescribe such 
     regulations as may be necessary to implement the amendments 
     made by this chapter.

               CHAPTER 4--STATE SUPPLEMENTATION PROGRAMS

     SEC. 4225. REPEAL OF MAINTENANCE OF EFFORT REQUIREMENTS 
                   APPLICABLE TO OPTIONAL STATE PROGRAMS FOR 
                   SUPPLEMENTATION OF SSI BENEFITS.

       Section 1618 (42 U.S.C. 1382g) is hereby repealed.

   CHAPTER 5--STUDIES REGARDING SUPPLEMENTAL SECURITY INCOME PROGRAM

     SEC. 4231. ANNUAL REPORT ON THE SUPPLEMENTAL SECURITY INCOME 
                   PROGRAM.

       Title XVI (42 U.S.C. 1381 et seq.), as amended by section 
     4201(c) of this Act, is amended by adding at the end the 
     following new section:


                       ``ANNUAL REPORT ON PROGRAM

       ``Sec. 1637. (a) Not later than May 30 of each year, the 
     Commissioner of Social Security shall prepare and deliver a 
     report annually to the President and the Congress regarding 
     the program under this title, including--
       ``(1) a comprehensive description of the program;
       ``(2) historical and current data on allowances and 
     denials, including number of applications and allowance rates 
     for initial determinations, reconsideration determinations, 
     administrative law judge hearings, appeals council reviews, 
     and Federal court decisions;
       ``(3) historical and current data on characteristics of 
     recipients and program costs, by recipient group (aged, 
     blind, disabled adults, and disabled children);
       ``(4) projections of future number of recipients and 
     program costs, through at least 25 years;
       ``(5) number of redeterminations and continuing disability 
     reviews, and the outcomes of such redeterminations and 
     reviews;
       ``(6) data on the utilization of work incentives;
       ``(7) detailed information on administrative and other 
     program operation costs;
       ``(8) summaries of relevant research undertaken by the 
     Social Security Administration, or by other researchers;
       ``(9) State supplementation program operations;
       ``(10) a historical summary of statutory changes to this 
     title; and
       ``(11) such other information as the Commissioner deems 
     useful.
       ``(b) Each member of the Social Security Advisory Board 
     shall be permitted to provide an individual report, or a 
     joint report if agreed, of views of the program under this 
     title, to be included in the annual report required under 
     this section.''.

     SEC. 4232. STUDY OF DISABILITY DETERMINATION PROCESS.

       (a) In General.--Not later than 90 days after the date of 
     the enactment of this Act, and from funds otherwise 
     appropriated, the Commissioner of Social Security shall make 
     arrangements with the National Academy of Sciences, or other 
     independent entity, to conduct a study of the disability 
     determination process under titles II and XVI of the

[[Page H7867]]

     Social Security Act. This study shall be undertaken in 
     consultation with professionals representing appropriate 
     disciplines.
       (b) Study Components.--The study described in subsection 
     (a) shall include--
       (1) an initial phase examining the appropriateness of, and 
     making recommendations regarding--
       (A) the definitions of disability in effect on the date of 
     the enactment of this Act and the advantages and 
     disadvantages of alternative definitions; and
       (B) the operation of the disability determination process, 
     including the appropriate method of performing comprehensive 
     assessments of individuals under age 18 with physical and 
     mental impairments;
       (2) a second phase, which may be concurrent with the 
     initial phase, examining the validity, reliability, and 
     consistency with current scientific knowledge of the 
     standards and individual listings in the Listing of 
     Impairments set forth in appendix 1 of subpart P of part 404 
     of title 20, Code of Federal Regulations, and of related 
     evaluation procedures as promulgated by the Commissioner of 
     Social Security; and
       (3) such other issues as the applicable entity considers 
     appropriate.
       (c) Reports and Regulations.--
       (1) Reports.--The Commissioner of Social Security shall 
     request the applicable entity, to submit an interim report 
     and a final report of the findings and recommendations 
     resulting from the study described in this section to the 
     President and the Congress not later than 18 months and 24 
     months, respectively, from the date of the contract for such 
     study, and such additional reports as the Commissioner deems 
     appropriate after consultation with the applicable entity.
       (2) Regulations.--The Commissioner of Social Security shall 
     review both the interim and final reports, and shall issue 
     regulations implementing any necessary changes following each 
     report.

     SEC. 4233. STUDY BY GENERAL ACCOUNTING OFFICE.

       Not later than January 1, 1999, the Comptroller General of 
     the United States shall study and report on--
       (1) the impact of the amendments made by, and the 
     provisions of, this subtitle on the supplemental security 
     income program under title XVI of the Social Security Act; 
     and
       (2) extra expenses incurred by families of children 
     receiving benefits under such title that are not covered by 
     other Federal, State, or local programs.

       CHAPTER 6--NATIONAL COMMISSION ON THE FUTURE OF DISABILITY

     SEC. 4241. ESTABLISHMENT.

       There is established a commission to be known as the 
     National Commission on the Future of Disability (referred to 
     in this chapter as the ``Commission'').

     SEC. 4242. DUTIES OF THE COMMISSION.

       (a) In General.--The Commission shall develop and carry out 
     a comprehensive study of all matters related to the nature, 
     purpose, and adequacy of all Federal programs serving 
     individuals with disabilities. In particular, the 
     Commission shall study the disability insurance program 
     under title II of the Social Security Act and the 
     supplemental security income disability program under 
     title XVI of such Act.
       (b) Matters Studied.--The Commission shall prepare an 
     inventory of Federal programs serving individuals with 
     disabilities, and shall examine--
       (1) trends and projections regarding the size and 
     characteristics of the population of individuals with 
     disabilities, and the implications of such analyses for 
     program planning;
       (2) the feasibility and design of performance standards for 
     the Nation's disability programs;
       (3) the adequacy of Federal efforts in rehabilitation 
     research and training, and opportunities to improve the lives 
     of individuals with disabilities through all manners of 
     scientific and engineering research; and
       (4) the adequacy of policy research available to the 
     Federal Government, and what actions might be undertaken to 
     improve the quality and scope of such research.
       (c) Recommendations.--The Commission shall submit to the 
     appropriate committees of the Congress and to the President 
     recommendations and, as appropriate, proposals for 
     legislation, regarding--
       (1) which (if any) Federal disability programs should be 
     eliminated or augmented;
       (2) what new Federal disability programs (if any) should be 
     established;
       (3) the suitability of the organization and location of 
     disability programs within the Federal Government;
       (4) other actions the Federal Government should take to 
     prevent disabilities and disadvantages associated with 
     disabilities; and
       (5) such other matters as the Commission considers 
     appropriate.

     SEC. 4243. MEMBERSHIP.

       (a) Number and Appointment.--
       (1) In general.--The Commission shall be composed of 15 
     members, of whom--
       (A) five shall be appointed by the President, of whom not 
     more than 3 shall be of the same major political party;
       (B) three shall be appointed by the Majority Leader of the 
     Senate;
       (C) two shall be appointed by the Minority Leader of the 
     Senate;
       (D) three shall be appointed by the Speaker of the House of 
     Representatives; and
       (E) two shall be appointed by the Minority Leader of the 
     House of Representatives.
       (2) Representation.--The Commission members shall be chosen 
     based on their education, training, or experience. In 
     appointing individuals as members of the Commission, the 
     President and the Majority and Minority Leaders of the Senate 
     and the Speaker and Minority Leader of the House of 
     Representatives shall seek to ensure that the membership of 
     the Commission reflects the general interests of the business 
     and taxpaying community and the diversity of individuals with 
     disabilities in the United States.
       (b) Comptroller General.--The Comptroller General of the 
     United States shall advise the Commission on the methodology 
     and approach of the study of the Commission.
       (c) Term of Appointment.--The members shall serve on the 
     Commission for the life of the Commission.
       (d) Meetings.--The Commission shall locate its headquarters 
     in the District of Columbia, and shall meet at the call of 
     the Chairperson, but not less than 4 times each year during 
     the life of the Commission.
       (e) Quorum.--Ten members of the Commission shall constitute 
     a quorum, but a lesser number may hold hearings.
       (f) Chairperson and Vice Chairperson.--Not later than 15 
     days after the members of the Commission are appointed, such 
     members shall designate a Chairperson and Vice Chairperson 
     from among the members of the Commission.
       (g) Continuation of Membership.--If a member of the 
     Commission becomes an officer or employee of any government 
     after appointment to the Commission, the individual may 
     continue as a member until a successor member is appointed.
       (h) Vacancies.--A vacancy on the Commission shall be filled 
     in the manner in which the original appointment was made not 
     later than 30 days after the Commission is given notice of 
     the vacancy.
       (i) Compensation.--Members of the Commission shall receive 
     no additional pay, allowances, or benefits by reason of their 
     service on the Commission.
       (j) Travel Expenses.--Each member of the Commission shall 
     receive travel expenses, including per diem in lieu of 
     subsistence, in accordance with sections 5702 and 5703 of 
     title 5, United States Code.

     SEC. 4244. STAFF AND SUPPORT SERVICES.

       (a) Director.--
       (1) Appointment.--Upon consultation with the members of the 
     Commission, the Chairperson shall appoint a Director of the 
     Commission.
       (2) Compensation.--The Director shall be paid the rate of 
     basic pay for level V of the Executive Schedule.
       (b) Staff.--With the approval of the Commission, the 
     Director may appoint such personnel as the Director considers 
     appropriate.
       (c) Applicability of Civil Service Laws.--The staff of the 
     Commission shall be appointed without regard to the 
     provisions of title 5, United States Code, governing 
     appointments in the competitive service, and shall be paid 
     without regard to the provisions of chapter 51 and subchapter 
     III of chapter 53 of such title relating to classification 
     and General Schedule pay rates.
       (d) Experts and Consultants.--With the approval of the 
     Commission, the Director may procure temporary and 
     intermittent services under section 3109(b) of title 5, 
     United States Code.
       (e) Staff of Federal Agencies.--Upon the request of the 
     Commission, the head of any Federal agency may detail, on a 
     reimbursable basis, any of the personnel of such agency to 
     the Commission to assist in carrying out the duties of the 
     Commission under this chapter.
       (f) Other Resources.--The Commission shall have reasonable 
     access to materials, resources, statistical data, and other 
     information from the Library of Congress and agencies and 
     elected representatives of the executive and legislative 
     branches of the Federal Government. The Chairperson of the 
     Commission shall make requests for such access in writing 
     when necessary.
       (g) Physical Facilities.--The Administrator of the General 
     Services Administration shall locate suitable office space 
     for the operation of the Commission. The facilities shall 
     serve as the headquarters of the Commission and shall include 
     all necessary equipment and incidentals required for proper 
     functioning of the Commission.

     SEC. 4245. POWERS OF COMMISSION.

       (a) Hearings.--The Commission may conduct public hearings 
     or forums at the discretion of the Commission, at any time 
     and place the Commission is able to secure facilities and 
     witnesses, for the purpose of carrying out the duties of the 
     Commission under this chapter.
       (b) Delegation of Authority.--Any member or agent of the 
     Commission may, if authorized by the Commission, take any 
     action the Commission is authorized to take by this section.
       (c) Information.--The Commission may secure directly from 
     any Federal agency information necessary to enable the 
     Commission to carry out its duties under this chapter. Upon 
     request of the Chairperson or Vice Chairperson of the 
     Commission, the head of a Federal agency shall furnish the 
     information to the Commission to the extent permitted by law.
       (d) Gifts, Bequests, and Devises.--The Commission may 
     accept, use, and dispose of gifts, bequests, or devises of 
     services or property, both real and personal, for the purpose 
     of aiding or facilitating the work of the Commission. Gifts, 
     bequests, or devises of money

[[Page H7868]]

     and proceeds from sales of other property received as gifts, 
     bequests, or devises shall be deposited in the Treasury and 
     shall be available for disbursement upon order of the 
     Commission.
       (e) Mails.--The Commission may use the United States mails 
     in the same manner and under the same conditions as other 
     Federal agencies.

     SEC. 4246. REPORTS.

       (a) Interim Report.--Not later than 1 year prior to the 
     date on which the Commission terminates pursuant to section 
     4247, the Commission shall submit an interim report to the 
     President and to the Congress. The interim report shall 
     contain a detailed statement of the findings and conclusions 
     of the Commission, together with the Commission's 
     recommendations for legislative and administrative action, 
     based on the activities of the Commission.
       (b) Final Report.--Not later than the date on which the 
     Commission terminates, the Commission shall submit to the 
     Congress and to the President a final report containing--
       (1) a detailed statement of final findings, conclusions, 
     and recommendations; and
       (2) an assessment of the extent to which recommendations of 
     the Commission included in the interim report under 
     subsection (a) have been implemented.
       (c) Printing and Public Distribution.--Upon receipt of each 
     report of the Commission under this section, the President 
     shall--
       (1) order the report to be printed; and
       (2) make the report available to the public upon request.

     SEC. 4247. TERMINATION.

       The Commission shall terminate on the date that is 2 years 
     after the date on which the members of the Commission have 
     met and designated a Chairperson and Vice Chairperson.

     SEC. 4248. AUTHORIZATION OF APPROPRIATIONS.

       There are authorized to be appropriated such sums as are 
     necessary to carry out the purposes of the Commission.
                       Subtitle C--Child Support

     SEC. 4300. REFERENCE TO SOCIAL SECURITY ACT.

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

     CHAPTER 1--ELIGIBILITY FOR SERVICES; DISTRIBUTION OF PAYMENTS

     SEC. 4301. STATE OBLIGATION TO PROVIDE CHILD SUPPORT 
                   ENFORCEMENT SERVICES.

       (a) State Plan Requirements.--Section 454 (42 U.S.C. 654) 
     is amended--
       (1) by striking paragraph (4) and inserting the following 
     new paragraph:
       ``(4) provide that the State will--
       ``(A) provide services relating to the establishment of 
     paternity or the establishment, modification, or enforcement 
     of child support obligations, as appropriate, under the plan 
     with respect to--
       ``(i) each child for whom (I) assistance is provided under 
     the State program funded under part A of this title, (II) 
     benefits or services for foster care maintenance are provided 
     under the State program funded under part E of this title, or 
     (III) medical assistance is provided under the State plan 
     under title XIX, unless, in accordance with paragraph (29), 
     good cause or other exceptions exist;
       ``(ii) any other child, if an individual applies for such 
     services with respect to the child; and
       ``(B) enforce any support obligation established with 
     respect to--
       ``(i) a child with respect to whom the State provides 
     services under the plan; or
       ``(ii) the custodial parent of such a child;''; and
       (2) in paragraph (6)--
       (A) by striking ``provide that'' and inserting ``provide 
     that--'';
       (B) by striking subparagraph (A) and inserting the 
     following new subparagraph:
       ``(A) services under the plan shall be made available to 
     residents of other States on the same terms as to residents 
     of the State submitting the plan;'';
       (C) in subparagraph (B), by inserting ``on individuals not 
     receiving assistance under any State program funded under 
     part A'' after ``such services shall be imposed'';
       (D) in each of subparagraphs (B), (C), (D), and (E)--
       (i) by indenting the subparagraph in the same manner as, 
     and aligning the left margin of the subparagraph with the 
     left margin of, the matter inserted by subparagraph (B) of 
     this paragraph; and
       (ii) by striking the final comma and inserting a semicolon; 
     and
       (E) in subparagraph (E), by indenting each of clauses (i) 
     and (ii) 2 additional ems.
       (b) Continuation of Services for Families Ceasing To 
     Receive Assistance Under the State Program Funded Under Part 
     A.--Section 454 (42 U.S.C. 654) is amended--
       (1) by striking ``and'' at the end of paragraph (23);
       (2) by striking the period at the end of paragraph (24) and 
     inserting ``; and''; and
       (3) by adding after paragraph (24) the following new 
     paragraph:
       ``(25) provide that if a family with respect to which 
     services are provided under the plan ceases to receive 
     assistance under the State program funded under part A, the 
     State shall provide appropriate notice to the family and 
     continue to provide such services, subject to the same 
     conditions and on the same basis as in the case of other 
     individuals to whom services are furnished under the plan, 
     except that an application or other request to continue 
     services shall not be required of such a family and paragraph 
     (6)(B) shall not apply to the family.''.
       (c) Conforming Amendments.--
       (1) Section 452(b) (42 U.S.C. 652(b)) is amended by 
     striking ``454(6)'' and inserting ``454(4)''.
       (2) Section 452(g)(2)(A) (42 U.S.C. 652(g)(2)(A)) is 
     amended by striking ``454(6)'' each place it appears and 
     inserting ``454(4)(A)(ii)''.
       (3) Section 466(a)(3)(B) (42 U.S.C. 666(a)(3)(B)) is 
     amended by striking ``in the case of overdue support which a 
     State has agreed to collect under section 454(6)'' and 
     inserting ``in any other case''.
       (4) Section 466(e) (42 U.S.C. 666(e)) is amended by 
     striking ``paragraph (4) or (6) of section 454'' and 
     inserting ``section 454(4)''.

     SEC. 4302. DISTRIBUTION OF CHILD SUPPORT COLLECTIONS.

       (a) In General.--Section 457 (42 U.S.C. 657) is amended to 
     read as follows:

     ``SEC. 457. DISTRIBUTION OF COLLECTED SUPPORT.

       ``(a) In General.--Subject to subsection (e), an amount 
     collected on behalf of a family as support by a State 
     pursuant to a plan approved under this part shall be 
     distributed as follows:
       ``(1) Families receiving assistance.--In the case of a 
     family receiving assistance from the State, the State shall--
       ``(A) pay to the Federal Government the Federal share of 
     the amount so collected; and
       ``(B) retain, or distribute to the family, the State share 
     of the amount so collected.
       ``(2) Families that formerly received assistance.--In the 
     case of a family that formerly received assistance from the 
     State:
       ``(A) Current support payments.--To the extent that the 
     amount so collected does not exceed the amount required to be 
     paid to the family for the month in which collected, the 
     State shall distribute the amount so collected to the family.
       ``(B) Payments of arrearages.--To the extent that the 
     amount so collected exceeds the amount required to be paid to 
     the family for the month in which collected, the State shall 
     distribute the amount so collected as follows:
       ``(i) Distribution of arrearages that accrued after the 
     family ceased to receive assistance.--

       ``(I) Pre-october 1997.--Except as provided in subclause 
     (II), the provisions of this section (other than subsection 
     (b)(1)) as in effect and applied on the day before the date 
     of the enactment of section 4302 of the Personal 
     Responsibility and Work Opportunity Act of 1996 shall apply 
     with respect to the distribution of support arrearages that--

       ``(aa) accrued after the family ceased to receive 
     assistance, and
       ``(bb) are collected before October 1, 1997.

       ``(II) Post-september 1997.--With respect to the amount so 
     collected on or after October 1, 1997 (or before such date, 
     at the option of the State)--

       ``(aa) In general.--The State shall first distribute the 
     amount so collected (other than any amount described in 
     clause (iv)) to the family to the extent necessary to satisfy 
     any support arrearages with respect to the family that 
     accrued after the family ceased to receive assistance from 
     the State.
       ``(bb) Reimbursement of governments for assistance provided 
     to the family.--After the application of division (aa) and 
     clause (ii)(II)(aa) with respect to the amount so collected, 
     the State shall retain the State share of the amount so 
     collected, and pay to the Federal Government the Federal 
     share (as defined in subsection (c)(2)) of the amount so 
     collected, but only to the extent necessary to reimburse 
     amounts paid to the family as assistance by the State.
       ``(cc) Distribution of the remainder to the family.--To the 
     extent that neither division (aa) nor division (bb) applies 
     to the amount so collected, the State shall distribute the 
     amount to the family.
       ``(ii) Distribution of arrearages that accrued before the 
     family received assistance.--

       ``(I) Pre-october 2000.--Except as provided in subclause 
     (II), the provisions of this section (other than subsection 
     (b)(1)) as in effect and applied on the day before the date 
     of the enactment of section 4302 of the Personal 
     Responsibility and Work Opportunity Act of 1996 shall apply 
     with respect to the distribution of support arrearages that--

       ``(aa) accrued before the family received assistance, and
       ``(bb) are collected before October 1, 2000.

       ``(II) Post-september 2000.--Unless, based on the report 
     required by paragraph (4), the Congress determines otherwise, 
     with respect to the amount so collected on or after October 
     1, 2000 (or before such date, at the option of the State)--

       ``(aa) In general.--The State shall first distribute the 
     amount so collected (other than any amount described in 
     clause (iv)) to the family to the extent necessary to satisfy 
     any support arrearages with respect to the family that 
     accrued before the family received assistance from the State.
       ``(bb) Reimbursement of governments for assistance provided 
     to the family.--After the application of clause (i)(II)(aa) 
     and division (aa) with respect to the amount so collected, 
     the State shall retain the State share

[[Page H7869]]

     of the amount so collected, and pay to the Federal Government 
     the Federal share (as defined in subsection (c)(2)) of the 
     amount so collected, but only to the extent necessary to 
     reimburse amounts paid to the family as assistance by the 
     State.
       ``(cc) Distribution of the remainder to the family.--To the 
     extent that neither division (aa) nor division (bb) applies 
     to the amount so collected, the State shall distribute the 
     amount to the family.
       ``(iii) Distribution of arrearages that accrued while the 
     family received assistance.--In the case of a family 
     described in this subparagraph, the provisions of paragraph 
     (1) shall apply with respect to the distribution of support 
     arrearages that accrued while the family received assistance.
       ``(iv) Amounts collected pursuant to section 464.--
     Notwithstanding any other provision of this section, any 
     amount of support collected pursuant to section 464 shall be 
     retained by the State to the extent past-due support has been 
     assigned to the State as a condition of receiving assistance 
     from the State, up to the amount necessary to reimburse the 
     State for amounts paid to the family as assistance by the 
     State. The State shall pay to the Federal Government the 
     Federal share of the amounts so retained. To the extent the 
     amount collected pursuant to section 464 exceeds the amount 
     so retained, the State shall distribute the excess to the 
     family.
       ``(v) Ordering rules for distributions.--For purposes of 
     this subparagraph, unless an earlier effective date is 
     required by this section, effective October 1, 2000, the 
     State shall treat any support arrearages collected, except 
     for amounts collected pursuant to section 464, as accruing in 
     the following order:

       ``(I) To the period after the family ceased to receive 
     assistance.
       ``(II) To the period before the family received assistance.
       ``(III) To the period while the family was receiving 
     assistance.

       ``(3) Families that never received assistance.--In the case 
     of any other family, the State shall distribute the amount so 
     collected to the family.
       ``(4) Study and report.--Not later than October 1, 1998, 
     the Secretary shall report to the Congress the Secretary's 
     findings with respect to--
       ``(A) whether the distribution of post-assistance 
     arrearages to families has been effective in moving people 
     off of welfare and keeping them off of welfare;
       ``(B) whether early implementation of a pre-assistance 
     arrearage program by some States has been effective in moving 
     people off of welfare and keeping them off of welfare;
       ``(C) what the overall impact has been of the amendments 
     made by the Personal Responsibility and Work Opportunity Act 
     of 1996 with respect to child support enforcement in moving 
     people off of welfare and keeping them off of welfare; and
       ``(D) based on the information and data the Secretary has 
     obtained, what changes, if any, should be made in the 
     policies related to the distribution of child support 
     arrearages.
       ``(b) Continuation Of Assignments.--Any rights to support 
     obligations, which were assigned to a State as a condition of 
     receiving assistance from the State under part A and which 
     were in effect on the day before the date of the enactment of 
     the Personal Responsibility and Work Opportunity Act of 1996, 
     shall remain assigned after such date.
       ``(c) Definitions.--As used in subsection (a):
       ``(1) Assistance.--The term `assistance from the State' 
     means--
       ``(A) assistance under the State program funded under part 
     A or under the State plan approved under part A of this title 
     (as in effect on the day before the date of the enactment of 
     the Personal Responsibility and Work Opportunity Act of 
     1996); and
       ``(B) foster care maintenance payments under the State plan 
     approved under part E of this title.
       ``(2) Federal share.--The term `Federal share' means that 
     portion of the amount collected resulting from the 
     application of the Federal medical assistance percentage in 
     effect for the fiscal year in which the amount is collected.
       ``(3) Federal medical assistance percentage.--The term 
     `Federal medical assistance percentage' means--
       ``(A) the Federal medical assistance percentage (as defined 
     in section 1118), in the case of Puerto Rico, the Virgin 
     Islands, Guam, and American Samoa; or
       ``(B) the Federal medical assistance percentage (as defined 
     in section 1905(b), as in effect on September 30, 1996) in 
     the case of any other State.
       ``(4) State share.--The term `State share' means 100 
     percent minus the Federal share.
       ``(d) Hold Harmless Provision.--If the amounts collected 
     which could be retained by the State in the fiscal year (to 
     the extent necessary to reimburse the State for amounts paid 
     to families as assistance by the State) are less than the 
     State share of the amounts collected in fiscal year 1995 
     (determined in accordance with section 457 as in effect on 
     the day before the date of the enactment of the Personal 
     Responsibility and Work Opportunity Act of 1996), the State 
     share for the fiscal year shall be an amount equal to the 
     State share in fiscal year 1995.
       ``(e) Gap Payments not Subject to Distribution Under This 
     Section.--At State option, this section shall not apply to 
     any amount collected on behalf of a family as support by the 
     State (and paid to the family in addition to the amount of 
     assistance otherwise payable to the family) pursuant to a 
     plan approved under this part if such amount would have been 
     paid to the family by the State under section 402(a)(28), as 
     in effect and applied on the day before the date of the 
     enactment of section 4302 of the Personal Responsibility and 
     Work Opportunity Act of 1996. For purposes of subsection (d), 
     the State share of such amount paid to the family shall be 
     considered amounts which could be retained by the State if 
     such payments were reported by the State as part of the State 
     share of amounts collected in fiscal year 1995.''.
       (b) Conforming Amendments.--
       (1) Section 464(a)(1) (42 U.S.C. 664(a)(1)) is amended by 
     striking ``section 457(b)(4) or (d)(3)'' and inserting 
     ``section 457''.
       (2) Section 454 (42 U.S.C. 654) is amended--
       (A) in paragraph (11)--
       (i) by striking ``(11)'' and inserting ``(11)(A)''; and
       (ii) by inserting after the semicolon ``and''; and
       (B) by redesignating paragraph (12) as subparagraph (B) of 
     paragraph (11).
       (c) Effective Dates.--
       (1) In General.--Except as provided in paragraph (2), the 
     amendments made by this section shall be effective on October 
     1, 1996, or earlier at the State's option.
       (2) Conforming amendments.--The amendments made by 
     subsection (b)(2) shall become effective on the date of the 
     enactment of this Act.

     SEC. 4303. PRIVACY SAFEGUARDS.

       (a) State Plan Requirement.--Section 454 (42 U.S.C. 654), 
     as amended by section 4301(b) of this Act, is amended--
       (1) by striking ``and'' at the end of paragraph (24);
       (2) by striking the period at the end of paragraph (25) and 
     inserting ``; and''; and
       (3) by adding after paragraph (25) the following new 
     paragraph:
       ``(26) will have in effect safeguards, applicable to all 
     confidential information handled by the State agency, that 
     are designed to protect the privacy rights of the parties, 
     including--
       ``(A) safeguards against unauthorized use or disclosure of 
     information relating to proceedings or actions to establish 
     paternity, or to establish or enforce support;
       ``(B) prohibitions against the release of information on 
     the whereabouts of 1 party to another party against whom a 
     protective order with respect to the former party has been 
     entered; and
       ``(C) prohibitions against the release of information on 
     the whereabouts of 1 party to another party if the State has 
     reason to believe that the release of the information may 
     result in physical or emotional harm to the former party.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall become effective on October 1, 1997.

     SEC. 4304. RIGHTS TO NOTIFICATION OF HEARINGS.

       (a) In General.--Section 454 (42 U.S.C. 654), as amended by 
     section 4302(b)(2) of this Act, is amended by inserting after 
     paragraph (11) the following new paragraph:
       ``(12) provide for the establishment of procedures to 
     require the State to provide individuals who are applying for 
     or receiving services under the State plan, or who are 
     parties to cases in which services are being provided under 
     the State plan--
       ``(A) with notice of all proceedings in which support 
     obligations might be established or modified; and
       ``(B) with a copy of any order establishing or modifying a 
     child support obligation, or (in the case of a petition for 
     modification) a notice of determination that there should be 
     no change in the amount of the child support award, within 14 
     days after issuance of such order or determination;''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall become effective on October 1, 1997.

                  CHAPTER 2--LOCATE AND CASE TRACKING

     SEC. 4311. STATE CASE REGISTRY.

       Section 454A, as added by section 4344(a)(2) of this Act, 
     is amended by adding at the end the following new 
     subsections:
       ``(e) State Case Registry.--
       ``(1) Contents.--The automated system required by this 
     section shall include a registry (which shall be known as the 
     `State case registry') that contains records with respect 
     to--
       ``(A) each case in which services are being provided by the 
     State agency under the State plan approved under this part; 
     and
       ``(B) each support order established or modified in the 
     State on or after October 1, 1998.
       ``(2) Linking of local registries.--The State case registry 
     may be established by linking local case registries of 
     support orders through an automated information network, 
     subject to this section.
       ``(3) Use of standardized data elements.--Such records 
     shall use standardized data elements for both parents (such 
     as names, social security numbers and other uniform 
     identification numbers, dates of birth, and case 
     identification numbers), and contain such other information 
     (such as on case status) as the Secretary may require.
       ``(4) Payment records.--Each case record in the State case 
     registry with respect to which services are being provided 
     under the State plan approved under this part and with

[[Page H7870]]

     respect to which a support order has been established shall 
     include a record of--
       ``(A) the amount of monthly (or other periodic) support 
     owed under the order, and other amounts (including 
     arrearages, interest or late payment penalties, and fees) due 
     or overdue under the order;
       ``(B) any amount described in subparagraph (A) that has 
     been collected;
       ``(C) the distribution of such collected amounts;
       ``(D) the birth date of any child for whom the order 
     requires the provision of support; and
       ``(E) the amount of any lien imposed with respect to the 
     order pursuant to section 466(a)(4).
       ``(5) Updating and monitoring.--The State agency operating 
     the automated system required by this section shall promptly 
     establish and update, maintain, and regularly monitor, case 
     records in the State case registry with respect to which 
     services are being provided under the State plan approved 
     under this part, on the basis of--
       ``(A) information on administrative actions and 
     administrative and judicial proceedings and orders relating 
     to paternity and support;
       ``(B) information obtained from comparison with Federal, 
     State, or local sources of information;
       ``(C) information on support collections and distributions; 
     and
       ``(D) any other relevant information.
       ``(f) Information Comparisons and Other Disclosures of 
     Information.--The State shall use the automated system 
     required by this section to extract information from (at such 
     times, and in such standardized format or formats, as may be 
     required by the Secretary), to share and compare information 
     with, and to receive information from, other data bases and 
     information comparison services, in order to obtain (or 
     provide) information necessary to enable the State agency (or 
     the Secretary or other State or Federal agencies) to carry 
     out this part, subject to section 6103 of the Internal 
     Revenue Code of 1986. Such information comparison activities 
     shall include the following:
       ``(1) Federal case registry of child support orders.--
     Furnishing to the Federal Case Registry of Child Support 
     Orders established under section 453(h) (and update as 
     necessary, with information including notice of expiration of 
     orders) the minimum amount of information on child support 
     cases recorded in the State case registry that is necessary 
     to operate the registry (as specified by the Secretary in 
     regulations).
       ``(2) Federal parent locator service.--Exchanging 
     information with the Federal Parent Locator Service for the 
     purposes specified in section 453.
       ``(3) Temporary family assistance and medicaid agencies.--
     Exchanging information with State agencies (of the State and 
     of other States) administering programs funded under part A, 
     programs operated under a State plan approved under title 
     XIX, and other programs designated by the Secretary, as 
     necessary to perform State agency responsibilities under this 
     part and under such programs.
       ``(4) Intrastate and interstate information comparisons.--
     Exchanging information with other agencies of the State, 
     agencies of other States, and interstate information 
     networks, as necessary and appropriate to carry out (or 
     assist other States to carry out) the purposes of this 
     part.''.

     SEC. 4312. COLLECTION AND DISBURSEMENT OF SUPPORT PAYMENTS.

       (a) State Plan Requirement.--Section 454 (42 U.S.C. 654), 
     as amended by sections 4301(b) and 4303(a) of this Act, is 
     amended--
       (1) by striking ``and'' at the end of paragraph (25);
       (2) by striking the period at the end of paragraph (26) and 
     inserting ``; and''; and
       (3) by adding after paragraph (26) the following new 
     paragraph:
       ``(27) provide that, on and after October 1, 1998, the 
     State agency will--
       ``(A) operate a State disbursement unit in accordance with 
     section 454B; and
       ``(B) have sufficient State staff (consisting of State 
     employees) and (at State option) contractors reporting 
     directly to the State agency to--
       ``(i) monitor and enforce support collections through the 
     unit in cases being enforced by the State pursuant to section 
     454(4) (including carrying out the automated data processing 
     responsibilities described in section 454A(g)); and
       ``(ii) take the actions described in section 466(c)(1) in 
     appropriate cases.''.
       (b) Establishment of State Disbursement Unit.--Part D of 
     title IV (42 U.S.C. 651-669), as amended by section 
     4344(a)(2) of this Act, is amended by inserting after section 
     454A the following new section:

     ``SEC. 454B. COLLECTION AND DISBURSEMENT OF SUPPORT PAYMENTS.

       ``(a) State Disbursement Unit.--
       ``(1) In general.--In order for a State to meet the 
     requirements of this section, the State agency must establish 
     and operate a unit (which shall be known as the `State 
     disbursement unit') for the collection and disbursement of 
     payments under support orders--
       ``(A) in all cases being enforced by the State pursuant to 
     section 454(4); and
       ``(B) in all cases not being enforced by the State under 
     this part in which the support order is initially issued in 
     the State on or after January 1, 1994, and in which the 
     income of the noncustodial parent are subject to withholding 
     pursuant to section 466(a)(8)(B).
       ``(2) Operation.--The State disbursement unit shall be 
     operated--
       ``(A) directly by the State agency (or 2 or more State 
     agencies under a regional cooperative agreement), or (to the 
     extent appropriate) by a contractor responsible directly to 
     the State agency; and
       ``(B) except in cases described in paragraph (1)(B), in 
     coordination with the automated system established by the 
     State pursuant to section 454A.
       ``(3) Linking of local disbursement units.--The State 
     disbursement unit may be established by linking local 
     disbursement units through an automated information network, 
     subject to this section, if the Secretary agrees that the 
     system will not cost more nor take more time to establish or 
     operate than a centralized system. In addition, employers 
     shall be given 1 location to which income withholding is 
     sent.
       ``(b) Required Procedures.--The State disbursement unit 
     shall use automated procedures, electronic processes, and 
     computer-driven technology to the maximum extent feasible, 
     efficient, and economical, for the collection and 
     disbursement of support payments, including procedures--
       ``(1) for receipt of payments from parents, employers, and 
     other States, and for disbursements to custodial parents and 
     other obligees, the State agency, and the agencies of other 
     States;
       ``(2) for accurate identification of payments;
       ``(3) to ensure prompt disbursement of the custodial 
     parent's share of any payment; and
       ``(4) to furnish to any parent, upon request, timely 
     information on the current status of support payments under 
     an order requiring payments to be made by or to the parent, 
     except that, with respect to a case described in subsection 
     (a)(1)(B), the State disbursement unit shall not be required 
     to maintain records of payments which, after the effective 
     date of this section, are made to, and distributed by, the 
     unit.
       ``(c) Timing of Disbursements.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     State disbursement unit shall distribute all amounts payable 
     under section 457(a) within 2 business days after receipt 
     from the employer or other source of periodic income, if 
     sufficient information identifying the payee is provided.
       ``(2) Permissive retention of arrearages.--The State 
     disbursement unit may delay the distribution of collections 
     toward arrearages until the resolution of any timely appeal 
     with respect to such arrearages.
       ``(d) Business Day Defined.--As used in this section, the 
     term `business day' means a day on which State offices are 
     open for regular business.''.
       (c) Use of Automated System.--Section 454A, as added by 
     section 4344(a)(2) and as amended by section 4311 of this 
     Act, is amended by adding at the end the following new 
     subsection:
       ``(g) Collection and Distribution of Support Payments.--
       ``(1) In general.--The State shall use the automated system 
     required by this section, to the maximum extent feasible, to 
     assist and facilitate the collection and disbursement of 
     support payments through the State disbursement unit operated 
     under section 454B, through the performance of functions, 
     including, at a minimum--
       ``(A) transmission of orders and notices to employers (and 
     other debtors) for the withholding of income--
       ``(i) within 2 business days after receipt of notice of, 
     and the income source subject to, such withholding from a 
     court, another State, an employer, the Federal Parent Locator 
     Service, or another source recognized by the State; and
       ``(ii) using uniform formats prescribed by the Secretary;
       ``(B) ongoing monitoring to promptly identify failures to 
     make timely payment of support; and
       ``(C) automatic use of enforcement procedures (including 
     procedures authorized pursuant to section 466(c)) if payments 
     are not timely made.
       ``(2) Business day defined.--As used in paragraph (1), the 
     term `business day' means a day on which State offices are 
     open for regular business.''.
       (d) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall become effective on 
     October 1, 1998.
       (2) Limited exception to unit handling payments.--
     Notwithstanding section 454B(b)(1) of the Social Security 
     Act, as added by this section, any State which, as of the 
     date of the enactment of this Act, processes the receipt of 
     child support payments through local courts may, at the 
     option of the State, continue to process through September 
     30, 1999, such payments through such courts as processed such 
     payments on or before such date of enactment.
       (e) Sense of the Congress.--It is the sense of the Congress 
     that, in determining whether to comply with section 454B of 
     the Social Security Act by establishing a single, centralized 
     unit for the collection and disbursement of support payments 
     or by linking together through automation local units for the 
     collection and disbursement of support payments, a 
     State should choose the method of compliance which best 
     meets the needs of parents, employers, and children.

     SEC. 4313. STATE DIRECTORY OF NEW HIRES.

       (a) State Plan Requirement.--Section 454 (42 U.S.C. 654), 
     as amended by sections

[[Page H7871]]

     4301(b), 4303(a) and 4312(a) of this Act, is amended--
       (1) by striking ``and'' at the end of paragraph (26);
       (2) by striking the period at the end of paragraph (27) and 
     inserting ``; and''; and
       (3) by adding after paragraph (27) the following new 
     paragraph:
       ``(28) provide that, on and after October 1, 1997, the 
     State will operate a State Directory of New Hires in 
     accordance with section 453A.''.
       (b) State Directory of New Hires.--Part D of title IV (42 
     U.S.C. 651-669) is amended by inserting after section 453 the 
     following new section:

     ``SEC. 453A. STATE DIRECTORY OF NEW HIRES.

       ``(a) Establishment.--
       ``(1) In general.--
       ``(A) Requirement for States that have no directory.--
     Except as provided in subparagraph (B), not later than 
     October 1, 1997, each State shall establish an automated 
     directory (to be known as the `State Directory of New Hires') 
     which shall contain information supplied in accordance with 
     subsection (b) by employers on each newly hired employee.
       ``(B) States with new hire reporting in existence.--A State 
     which has a new hire reporting law in existence on the date 
     of the enactment of this section may continue to operate 
     under the State law, but the State must meet the requirements 
     of subsection (g)(2) not later than October 1, 1997, and the 
     requirements of this section (other than subsection (g)(2)) 
     not later than October 1, 1998.
       ``(2) Definitions.--As used in this section:
       ``(A) Employee.--The term `employee'--
       ``(i) means an individual who is an employee within the 
     meaning of chapter 24 of the Internal Revenue Code of 1986; 
     and
       ``(ii) does not include an employee of a Federal or State 
     agency performing intelligence or counterintelligence 
     functions, if the head of such agency has determined that 
     reporting pursuant to paragraph (1) with respect to the 
     employee could endanger the safety of the employee or 
     compromise an ongoing investigation or intelligence mission.
       ``(B) Employer.--
       ``(i) In general.--The term `employer' has the meaning 
     given such term in section 3401(d) of the Internal Revenue 
     Code of 1986 and includes any governmental entity and any 
     labor organization.
       ``(ii) Labor organization.--The term `labor organization' 
     shall have the meaning given such term in section 2(5) of the 
     National Labor Relations Act, and includes any entity (also 
     known as a `hiring hall') which is used by the organization 
     and an employer to carry out requirements described in 
     section 8(f)(3) of such Act of an agreement between the 
     organization and the employer.
       ``(b) Employer Information.--
       ``(1) Reporting requirement.--
       ``(A) In general.--Except as provided in subparagraphs (B) 
     and (C), each employer shall furnish to the Directory of New 
     Hires of the State in which a newly hired employee works, a 
     report that contains the name, address, and social security 
     number of the employee, and the name and address of, and 
     identifying number assigned under section 6109 of the 
     Internal Revenue Code of 1986 to, the employer.
       ``(B) Multistate employers.--An employer that has employees 
     who are employed in 2 or more States and that transmits 
     reports magnetically or electronically may comply with 
     subparagraph (A) by designating 1 State in which such 
     employer has employees to which the employer will transmit 
     the report described in subparagraph (A), and transmitting 
     such report to such State. Any employer that transmits 
     reports pursuant to this subparagraph shall notify the 
     Secretary in writing as to which State such employer 
     designates for the purpose of sending reports.
       ``(C) Federal government employers.--Any department, 
     agency, or instrumentality of the United States shall comply 
     with subparagraph (A) by transmitting the report described in 
     subparagraph (A) to the National Directory of New Hires 
     established pursuant to section 453.
       ``(2) Timing of report.--Each State may provide the time 
     within which the report required by paragraph (1) shall be 
     made with respect to an employee, but such report shall be 
     made--
       ``(A) not later than 20 days after the date the employer 
     hires the employee; or
       ``(B) in the case of an employer transmitting reports 
     magnetically or electronically, by 2 monthly transmissions 
     (if necessary) not less than 12 days nor more than 16 days 
     apart.
       ``(c) Reporting Format and Method.--Each report required by 
     subsection (b) shall be made on a W-4 form or, at the option 
     of the employer, an equivalent form, and may be transmitted 
     by 1st class mail, magnetically, or electronically.
       ``(d) Civil Money Penalties on Noncomplying Employers.--The 
     State shall have the option to set a State civil money 
     penalty which shall be less than--
       ``(1) $25; or
       ``(2) $500 if, under State law, the failure is the result 
     of a conspiracy between the employer and the employee to not 
     supply the required report or to supply a false or incomplete 
     report.
       ``(e) Entry of Employer Information.--Information shall be 
     entered into the data base maintained by the State Directory 
     of New Hires within 5 business days of receipt from an 
     employer pursuant to subsection (b).
       ``(f) Information Comparisons.--
       ``(1) In general.--Not later than May 1, 1998, an agency 
     designated by the State shall, directly or by contract, 
     conduct automated comparisons of the social security numbers 
     reported by employers pursuant to subsection (b) and the 
     social security numbers appearing in the records of the State 
     case registry for cases being enforced under the State plan.
       ``(2) Notice of match.--When an information comparison 
     conducted under paragraph (1) reveals a match with respect to 
     the social security number of an individual required to 
     provide support under a support order, the State Directory of 
     New Hires shall provide the agency administering the State 
     plan approved under this part of the appropriate State with 
     the name, address, and social security number of the employee 
     to whom the social security number is assigned, and the name 
     and address of, and identifying number assigned under section 
     6109 of the Internal Revenue Code of 1986 to, the employer.
       ``(g) Transmission of Information.--
       ``(1) Transmission of wage withholding notices to 
     employers.--Within 2 business days after the date information 
     regarding a newly hired employee is entered into the State 
     Directory of New Hires, the State agency enforcing the 
     employee's child support obligation shall transmit a notice 
     to the employer of the employee directing the employer to 
     withhold from the income of the employee an amount equal to 
     the monthly (or other periodic) child support obligation 
     (including any past due support obligation) of the employee, 
     unless the employee's income is not subject to withholding 
     pursuant to section 466(b)(3).
       ``(2) Transmissions to the national directory of new 
     hires.--
       ``(A) New hire information.--Within 3 business days after 
     the date information regarding a newly hired employee is 
     entered into the State Directory of New Hires, the State 
     Directory of New Hires shall furnish the information to the 
     National Directory of New Hires.
       ``(B) Wage and unemployment compensation information.--The 
     State Directory of New Hires shall, on a quarterly basis, 
     furnish to the National Directory of New Hires extracts of 
     the reports required under section 303(a)(6) to be made to 
     the Secretary of Labor concerning the wages and unemployment 
     compensation paid to individuals, by such dates, in such 
     format, and containing such information as the Secretary of 
     Health and Human Services shall specify in regulations.
       ``(3) Business day defined.--As used in this subsection, 
     the term `business day' means a day on which State offices 
     are open for regular business.
       ``(h) Other Uses of New Hire Information.--
       ``(1) Location of child support obligors.--The agency 
     administering the State plan approved under this part shall 
     use information received pursuant to subsection (f)(2) to 
     locate individuals for purposes of establishing paternity and 
     establishing, modifying, and enforcing child support 
     obligations, and may disclose such information to any agent 
     of the agency that is under contract with the agency to carry 
     out such purposes.
       ``(2) Verification of eligibility for certain programs.--A 
     State agency responsible for administering a program 
     specified in section 1137(b) shall have access to information 
     reported by employers pursuant to subsection (b) of this 
     section for purposes of verifying eligibility for the 
     program.
       ``(3) Administration of employment security and workers' 
     compensation.--State agencies operating employment security 
     and workers' compensation programs shall have access to 
     information reported by employers pursuant to subsection (b) 
     for the purposes of administering such programs.''.
       (c) Quarterly Wage Reporting.--Section 1137(a)(3) (42 
     U.S.C. 1320b-7(a)(3)) is amended--
       (1) by inserting ``(including State and local governmental 
     entities and labor organizations (as defined in section 
     453A(a)(2)(B)(iii))'' after ``employers''; and
       (2) by inserting ``, and except that no report shall be 
     filed with respect to an employee of a State or local agency 
     performing intelligence or counterintelligence functions, if 
     the head of such agency has determined that filing such a 
     report could endanger the safety of the employee or 
     compromise an ongoing investigation or intelligence mission'' 
     after ``paragraph (2)''.
       (d) Disclosure to Certain Agents.--Section 303(e) (42 
     U.S.C. 503(e)) is amended by adding at the end the following:
       ``(5) A State or local child support enforcement agency may 
     disclose to any agent of the agency that is under contract 
     with the agency to carry out the purposes described in 
     paragraph (1)(B) wage information that is disclosed to an 
     officer or employee of the agency under paragraph (1)(A). Any 
     agent of a State or local child support agency that receives 
     wage information under this paragraph shall comply with the 
     safeguards established pursuant to paragraph (1)(B).''.

     SEC. 4314. AMENDMENTS CONCERNING INCOME WITHHOLDING.

       (a) Mandatory Income Withholding.--
       (1) In general.--Section 466(a)(1) (42 U.S.C. 666(a)(1)) is 
     amended to read as follows:
       ``(1)(A) Procedures described in subsection (b) for the 
     withholding from income of amounts payable as support in 
     cases subject to enforcement under the State plan.
       ``(B) Procedures under which the income of a person with a 
     support obligation imposed by a support order issued (or 
     modified) in the

[[Page H7872]]

     State before October 1, 1996, if not otherwise subject to 
     withholding under subsection (b), shall become subject to 
     withholding as provided in subsection (b) if arrearages 
     occur, without the need for a judicial or administrative 
     hearing.''.
       (2) Conforming amendments.--
       (A) Section 466(b) (42 U.S.C. 666(b)) is amended in the 
     matter preceding paragraph (1), by striking ``subsection 
     (a)(1)'' and inserting ``subsection (a)(1)(A)''.
       (B) Section 466(b)(4) (42 U.S.C. 666(b)(4)) is amended to 
     read as follows:
       ``(4)(A) Such withholding must be carried out in full 
     compliance with all procedural due process requirements of 
     the State, and the State must send notice to each 
     noncustodial parent to whom paragraph (1) applies--
       ``(i) that the withholding has commenced; and
       ``(ii) of the procedures to follow if the noncustodial 
     parent desires to contest such withholding on the grounds 
     that the withholding or the amount withheld is improper due 
     to a mistake of fact.
       ``(B) The notice under subparagraph (A) of this paragraph 
     shall include the information provided to the employer under 
     paragraph (6)(A).''.
       (C) Section 466(b)(5) (42 U.S.C. 666(b)(5)) is amended by 
     striking all that follows ``administered by'' and inserting 
     ``the State through the State disbursement unit established 
     pursuant to section 454B, in accordance with the requirements 
     of section 454B.''.
       (D) Section 466(b)(6)(A) (42 U.S.C. 666(b)(6)(A)) is 
     amended--
       (i) in clause (i), by striking ``to the appropriate 
     agency'' and all that follows and inserting ``to the State 
     disbursement unit within 5 business days after the date the 
     amount would (but for this subsection) have been paid or 
     credited to the employee, for distribution in accordance with 
     this part. The employer shall withhold funds as directed in 
     the notice. For terms and conditions for withholding income 
     that are not specified in a notice issued by another State, 
     the employer shall apply the law of the State in which the 
     obligor works. An employer who complies with an income 
     withholding notice that is regular on its face shall not be 
     subject to civil liability to any individual or agency for 
     conduct in compliance with the notice.''.
       (ii) in clause (ii), by inserting ``be in a standard format 
     prescribed by the Secretary, and'' after ``shall''; and
       (iii) by adding at the end the following new clause:
       ``(iii) As used in this subparagraph, the term `business 
     day' means a day on which State offices are open for regular 
     business.''.
       (E) Section 466(b)(6)(D) (42 U.S.C. 666(b)(6)(D)) is 
     amended by striking ``any employer'' and all that follows and 
     inserting ``any employer who--
       ``(i) discharges from employment, refuses to employ, or 
     takes disciplinary action against any noncustodial parent 
     subject to income withholding required by this subsection 
     because of the existence of such withholding and the 
     obligations or additional obligations which it imposes upon 
     the employer; or
       ``(ii) fails to withhold support from income or to pay such 
     amounts to the State disbursement unit in accordance with 
     this subsection.''.
       (F) Section 466(b) (42 U.S.C. 666(b)) is amended by adding 
     at the end the following new paragraph:
       ``(11) Procedures under which the agency administering the 
     State plan approved under this part may execute a withholding 
     order without advance notice to the obligor, including 
     issuing the withholding order through electronic means.''.
       (b) Definition of Income.--
       (1) In general.--Section 466(b)(8) (42 U.S.C. 666(b)(8)) is 
     amended to read as follows:
       ``(8) For purposes of subsection (a) and this subsection, 
     the term `income' means any periodic form of payment due to 
     an individual, regardless of source, including wages, 
     salaries, commissions, bonuses, worker's compensation, 
     disability, payments pursuant to a pension or retirement 
     program, and interest.''.
       (2) Conforming amendments.--
       (A) Subsections (a)(8)(A), (a)(8)(B)(i), (b)(3)(A), 
     (b)(3)(B), (b)(6)(A)(i), and (b)(6)(C), and (b)(7) of section 
     466 (42 U.S.C. 666(a)(8)(A), (a)(8)(B)(i), (b)(3)(A), 
     (b)(3)(B), (b)(6)(A)(i), and (b)(6)(C), and (b)(7)) are each 
     amended by striking ``wages'' each place such term appears 
     and inserting ``income''.
       (B) Section 466(b)(1) (42 U.S.C. 666(b)(1)) is amended by 
     striking ``wages (as defined by the State for purposes of 
     this section)'' and inserting ``income''.
       (c) Conforming Amendment.--Section 466(c) (42 U.S.C. 
     666(c)) is repealed.

     SEC. 4315. LOCATOR INFORMATION FROM INTERSTATE NETWORKS.

       Section 466(a) (42 U.S.C. 666(a)) is amended by inserting 
     after paragraph (11) the following new paragraph:
       ``(12) Locator information from interstate networks.--
     Procedures to ensure that all Federal and State agencies 
     conducting activities under this part have access to any 
     system used by the State to locate an individual for purposes 
     relating to motor vehicles or law enforcement.''.

     SEC. 4316. EXPANSION OF THE FEDERAL PARENT LOCATOR SERVICE.

       (a) Expanded Authority To Locate Individuals and Assets.--
     Section 453 (42 U.S.C. 653) is amended--
       (1) in subsection (a), by striking all that follows 
     ``subsection (c))'' and inserting ``, for the purpose of 
     establishing parentage, establishing, setting the amount of, 
     modifying, or enforcing child support obligations, or 
     enforcing child custody or visitation orders--
       ``(1) information on, or facilitating the discovery of, the 
     location of any individual--
       ``(A) who is under an obligation to pay child support or 
     provide child custody or visitation rights;
       ``(B) against whom such an obligation is sought;
       ``(C) to whom such an obligation is owed,

     including the individual's social security number (or 
     numbers), most recent address, and the name, address, and 
     employer identification number of the individual's employer;
       ``(2) information on the individual's wages (or other 
     income) from, and benefits of, employment (including rights 
     to or enrollment in group health care coverage); and
       ``(3) information on the type, status, location, and amount 
     of any assets of, or debts owed by or to, any such 
     individual.''; and
       (2) in subsection (b)--
       (A) in the matter preceding paragraph (1), by striking 
     ``social security'' and all that follows through ``absent 
     parent'' and inserting ``information described in subsection 
     (a)''; and
       (B) in the flush paragraph at the end, by adding the 
     following: ``No information shall be disclosed to any person 
     if the State has notified the Secretary that the State has 
     reasonable evidence of domestic violence or child abuse and 
     the disclosure of such information could be harmful to the 
     custodial parent or the child of such parent. Information 
     received or transmitted pursuant to this section shall be 
     subject to the safeguard provisions contained in section 
     454(26).''.
       (b) Authorized Person for Information Regarding Visitation 
     Rights.--Section 453(c) (42 U.S.C. 653(c)) is amended--
       (1) in paragraph (1), by striking ``support'' and inserting 
     ``support or to seek to enforce orders providing child 
     custody or visitation rights''; and
       (2) in paragraph (2), by striking ``, or any agent of such 
     court; and'' and inserting ``or to issue an order against a 
     resident parent for child custody or visitation rights, or 
     any agent of such court;''.
       (c) Reimbursement for Information From Federal Agencies.--
     Section 453(e)(2) (42 U.S.C. 653(e)(2)) is amended in the 4th 
     sentence by inserting ``in an amount which the Secretary 
     determines to be reasonable payment for the information 
     exchange (which amount shall not include payment for the 
     costs of obtaining, compiling, or maintaining the 
     information)'' before the period.
       (d) Reimbursement for Reports by State Agencies.--Section 
     453 (42 U.S.C. 653) is amended by adding at the end the 
     following new subsection:
       ``(g) Reimbursement for Reports by State Agencies.--The 
     Secretary may reimburse Federal and State agencies for the 
     costs incurred by such entities in furnishing information 
     requested by the Secretary under this section in an amount 
     which the Secretary determines to be reasonable payment for 
     the information exchange (which amount shall not include 
     payment for the costs of obtaining, compiling, or maintaining 
     the information).''.
       (e) Conforming Amendments.--
       (1) Sections 452(a)(9), 453(a), 453(b), 463(a), 463(e), and 
     463(f) (42 U.S.C. 652(a)(9), 653(a), 653(b), 663(a), 663(e), 
     and 663(f)) are each amended by inserting ``Federal'' before 
     ``Parent'' each place such term appears.
       (2) Section 453 (42 U.S.C. 653) is amended in the heading 
     by adding ``federal'' before ``parent''.
       (f) New Components.--Section 453 (42 U.S.C. 653), as 
     amended by subsection (d) of this section, is amended by 
     adding at the end the following new subsections:
       ``(h) Federal Case Registry of Child Support Orders.--
       ``(1) In general.--Not later than October 1, 1998, in order 
     to assist States in administering programs under State plans 
     approved under this part and programs funded under part A, 
     and for the other purposes specified in this section, the 
     Secretary shall establish and maintain in the Federal Parent 
     Locator Service an automated registry (which shall be known 
     as the `Federal Case Registry of Child Support Orders'), 
     which shall contain abstracts of support orders and other 
     information described in paragraph (2) with respect to each 
     case in each State case registry maintained pursuant to 
     section 454A(e), as furnished (and regularly updated), 
     pursuant to section 454A(f), by State agencies administering 
     programs under this part.
       ``(2) Case information.--The information referred to in 
     paragraph (1) with respect to a case shall be such 
     information as the Secretary may specify in regulations 
     (including the names, social security numbers or other 
     uniform identification numbers, and State case identification 
     numbers) to identify the individuals who owe or are owed 
     support (or with respect to or on behalf of whom support 
     obligations are sought to be established), and the State or 
     States which have the case.
       ``(i) National Directory of New Hires.--
       ``(1) In general.--In order to assist States in 
     administering programs under State plans approved under this 
     part and programs funded under part A, and for the other 
     purposes specified in this section, the Secretary shall, not 
     later than October 1, 1997, establish and maintain in the 
     Federal Parent Locator Service an automated directory to be 
     known as the National Directory of New Hires, which shall 
     contain the information supplied pursuant to section 
     453A(g)(2).

[[Page H7873]]

       ``(2) Entry of data.--Information shall be entered into the 
     data base maintained by the National Directory of New Hires 
     within 2 business days of receipt pursuant to section 
     453A(g)(2).
       ``(3) Administration of federal tax laws.--The Secretary of 
     the Treasury shall have access to the information in the 
     National Directory of New Hires for purposes of administering 
     section 32 of the Internal Revenue Code of 1986, or the 
     advance payment of the earned income tax credit under 
     section 3507 of such Code, and verifying a claim with 
     respect to employment in a tax return.
       ``(4) List of multistate employers.--The Secretary shall 
     maintain within the National Directory of New Hires a list of 
     multistate employers that report information regarding newly 
     hired employees pursuant to section 453A(b)(1)(B), and the 
     State which each such employer has designated to receive such 
     information.
       ``(j) Information Comparisons and Other Disclosures.--
       ``(1) Verification by social security administration.--
       ``(A) In general.--The Secretary shall transmit information 
     on individuals and employers maintained under this section to 
     the Social Security Administration to the extent necessary 
     for verification in accordance with subparagraph (B).
       ``(B) Verification by ssa.--The Social Security 
     Administration shall verify the accuracy of, correct, or 
     supply to the extent possible, and report to the Secretary, 
     the following information supplied by the Secretary pursuant 
     to subparagraph (A):
       ``(i) The name, social security number, and birth date of 
     each such individual.
       ``(ii) The employer identification number of each such 
     employer.
       ``(2) Information comparisons.--For the purpose of locating 
     individuals in a paternity establishment case or a case 
     involving the establishment, modification, or enforcement of 
     a support order, the Secretary shall--
       ``(A) compare information in the National Directory of New 
     Hires against information in the support case abstracts in 
     the Federal Case Registry of Child Support Orders not less 
     often than every 2 business days; and
       ``(B) within 2 business days after such a comparison 
     reveals a match with respect to an individual, report the 
     information to the State agency responsible for the case.
       ``(3) Information comparisons and disclosures of 
     information in all registries for title iv program 
     purposes.--To the extent and with the frequency that the 
     Secretary determines to be effective in assisting States to 
     carry out their responsibilities under programs operated 
     under this part and programs funded under part A, the 
     Secretary shall--
       ``(A) compare the information in each component of the 
     Federal Parent Locator Service maintained under this section 
     against the information in each other such component (other 
     than the comparison required by paragraph (2)), and report 
     instances in which such a comparison reveals a match with 
     respect to an individual to State agencies operating such 
     programs; and
       ``(B) disclose information in such registries to such State 
     agencies.
       ``(4) Provision of new hire information to the social 
     security administration.--The National Directory of New Hires 
     shall provide the Commissioner of Social Security with all 
     information in the National Directory, which shall be used to 
     determine the accuracy of payments under the supplemental 
     security income program under title XVI and in connection 
     with benefits under title II.
       ``(5) Research.--The Secretary may provide access to 
     information reported by employers pursuant to section 453A(b) 
     for research purposes found by the Secretary to be likely to 
     contribute to achieving the purposes of part A or this part, 
     but without personal identifiers.
       ``(k) Fees.--
       ``(1) For ssa verification.--The Secretary shall reimburse 
     the Commissioner of Social Security, at a rate negotiated 
     between the Secretary and the Commissioner, for the costs 
     incurred by the Commissioner in performing the 
     verification services described in subsection (j).
       ``(2) For information from state directories of new 
     hires.--The Secretary shall reimburse costs incurred by State 
     directories of new hires in furnishing information as 
     required by subsection (j)(3), at rates which the Secretary 
     determines to be reasonable (which rates shall not include 
     payment for the costs of obtaining, compiling, or maintaining 
     such information).
       ``(3) For information furnished to state and federal 
     agencies.--A State or Federal agency that receives 
     information from the Secretary pursuant to this section shall 
     reimburse the Secretary for costs incurred by the Secretary 
     in furnishing the information, at rates which the Secretary 
     determines to be reasonable (which rates shall include 
     payment for the costs of obtaining, verifying, maintaining, 
     and comparing the information).
       ``(l) Restriction on Disclosure and Use.--Information in 
     the Federal Parent Locator Service, and information resulting 
     from comparisons using such information, shall not be used or 
     disclosed except as expressly provided in this section, 
     subject to section 6103 of the Internal Revenue Code of 1986.
       ``(m) Information Integrity and Security.--The Secretary 
     shall establish and implement safeguards with respect to the 
     entities established under this section designed to--
       ``(1) ensure the accuracy and completeness of information 
     in the Federal Parent Locator Service; and
       ``(2) restrict access to confidential information in the 
     Federal Parent Locator Service to authorized persons, and 
     restrict use of such information to authorized purposes.
       ``(n) Federal Government Reporting.--Each department, 
     agency, and instrumentality of the United States shall on a 
     quarterly basis report to the Federal Parent Locator Service 
     the name and social security number of each employee and the 
     wages paid to the employee during the previous quarter, 
     except that such a report shall not be filed with respect to 
     an employee of a department, agency, or instrumentality 
     performing intelligence or counterintelligence functions, if 
     the head of such department, agency, or instrumentality has 
     determined that filing such a report could endanger the 
     safety of the employee or compromise an ongoing investigation 
     or intelligence mission.''.
       (g) Conforming Amendments.--
       (1) To part d of title iv of the social security act.--
       (A) Section 454(8)(B) (42 U.S.C. 654(8)(B)) is amended to 
     read as follows:
       ``(B) the Federal Parent Locator Service established under 
     section 453;''.
       (B) Section 454(13) (42 U.S.C.654(13)) is amended by 
     inserting ``and provide that information requests by parents 
     who are residents of other States be treated with the same 
     priority as requests by parents who are residents of the 
     State submitting the plan'' before the semicolon.
       (2) To federal unemployment tax act.--Section 3304(a)(16) 
     of the Internal Revenue Code of 1986 is amended--
       (A) by striking ``Secretary of Health, Education, and 
     Welfare'' each place such term appears and inserting 
     ``Secretary of Health and Human Services'';
       (B) in subparagraph (B), by striking ``such information'' 
     and all that follows and inserting ``information furnished 
     under subparagraph (A) or (B) is used only for the purposes 
     authorized under such subparagraph;'';
       (C) by striking ``and'' at the end of subparagraph (A);
       (D) by redesignating subparagraph (B) as subparagraph (C); 
     and
       (E) by inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) wage and unemployment compensation information 
     contained in the records of such agency shall be furnished to 
     the Secretary of Health and Human Services (in accordance 
     with regulations promulgated by such Secretary) as 
     necessary for the purposes of the National Directory of 
     New Hires established under section 453(i) of the Social 
     Security Act, and''.
       (3) To state grant program under title iii of the social 
     security act.--Subsection (h) of section 303 (42 U.S.C. 503) 
     is amended to read as follows:
       ``(h)(1) The State agency charged with the administration 
     of the State law shall, on a reimbursable basis--
       ``(A) disclose quarterly, to the Secretary of Health and 
     Human Services, wage and claim information, as required 
     pursuant to section 453(i)(1), contained in the records of 
     such agency;
       ``(B) ensure that information provided pursuant to 
     subparagraph (A) meets such standards relating to correctness 
     and verification as the Secretary of Health and Human 
     Services, with the concurrence of the Secretary of Labor, may 
     find necessary; and
       ``(C) establish such safeguards as the Secretary of Labor 
     determines are necessary to insure that information disclosed 
     under subparagraph (A) is used only for purposes of section 
     453(i)(1) in carrying out the child support enforcement 
     program under title IV.
       ``(2) Whenever the Secretary of Labor, after reasonable 
     notice and opportunity for hearing to the State agency 
     charged with the administration of the State law, finds that 
     there is a failure to comply substantially with the 
     requirements of paragraph (1), the Secretary of Labor shall 
     notify such State agency that further payments will not be 
     made to the State until the Secretary of Labor is satisfied 
     that there is no longer any such failure. Until the Secretary 
     of Labor is so satisfied, the Secretary shall make no future 
     certification to the Secretary of the Treasury with respect 
     to the State.
       ``(3) For purposes of this subsection--
       ``(A) the term `wage information' means information 
     regarding wages paid to an individual, the social security 
     account number of such individual, and the name, address, 
     State, and the Federal employer identification number of the 
     employer paying such wages to such individual; and
       ``(B) the term `claim information' means information 
     regarding whether an individual is receiving, has received, 
     or has made application for, unemployment compensation, the 
     amount of any such compensation being received (or to be 
     received by such individual), and the individual's current 
     (or most recent) home address.''.
       (4) Disclosure of certain information to agents of child 
     support enforcement agencies.--
       (A) In general.--Paragraph (6) of section 6103(l) of the 
     Internal Revenue Code of 1986 (relating to disclosure of 
     return information to Federal, State, and local child support 
     enforcement agencies) is amended by redesignating 
     subparagraph (B) as subparagraph (C) and by inserting after 
     subparagraph (A) the following new subparagraph:
       ``(B) Disclosure to certain agents.--The following 
     information disclosed to any child

[[Page H7874]]

     support enforcement agency under subparagraph (A) with 
     respect to any individual with respect to whom child support 
     obligations are sought to be established or enforced may be 
     disclosed by such agency to any agent of such agency which is 
     under contract with such agency to carry out the purposes 
     described in subparagraph (C):
       ``(i) The address and social security account number (or 
     numbers) of such individual.
       ``(ii) The amount of any reduction under section 6402(c) 
     (relating to offset of past-due support against overpayments) 
     in any overpayment otherwise payable to such individual.''
       (B) Conforming amendments.--
       (i) Paragraph (3) of section 6103(a) of such Code is 
     amended by striking ``(l)(12)'' and inserting ``paragraph (6) 
     or (12) of subsection (l)''.
       (ii) Subparagraph (C) of section 6103(l)(6) of such Code, 
     as redesignated by subsection (a), is amended to read as 
     follows:
       ``(C) Restriction on disclosure.--Information may be 
     disclosed under this paragraph only for purposes of, and to 
     the extent necessary in, establishing and collecting child 
     support obligations from, and locating, individuals owing 
     such obligations.''
       (iii) The material following subparagraph (F) of section 
     6103(p)(4) of such Code is amended by striking ``subsection 
     (l)(12)(B)'' and inserting ``paragraph (6)(A) or (12)(B) of 
     subsection (l)''.
       (h) Requirement for Cooperation.--The Secretary of Labor 
     and the Secretary of Health and Human Services shall work 
     jointly to develop cost-effective and efficient methods of 
     accessing the information in the various State directories of 
     new hires and the National Directory of New Hires as 
     established pursuant to the amendments made by this chapter. 
     In developing these methods the Secretaries shall take into 
     account the impact, including costs, on the States, and shall 
     also consider the need to insure the proper and authorized 
     use of wage record information.

     SEC. 4317. COLLECTION AND USE OF SOCIAL SECURITY NUMBERS FOR 
                   USE IN CHILD SUPPORT ENFORCEMENT.

       (a) State Law Requirement.--Section 466(a) (42 U.S.C. 
     666(a)), as amended by section 4315 of this Act, is amended 
     by inserting after paragraph (12) the following new 
     paragraph:
       ``(13) Recording of social security numbers in certain 
     family matters.--Procedures requiring that the social 
     security number of--
       ``(A) any applicant for a professional license, commercial 
     driver's license, occupational license, or marriage license 
     be recorded on the application;
       ``(B) any individual who is subject to a divorce decree, 
     support order, or paternity determination or acknowledgment 
     be placed in the records relating to the matter; and
       ``(C) any individual who has died be placed in the records 
     relating to the death and be recorded on the death 
     certificate.

     For purposes of subparagraph (A), if a State allows the use 
     of a number other than the social security number, the State 
     shall so advise any applicants.''.
       (b) Conforming Amendments.--Section 205(c)(2)(C) (42 U.S.C. 
     405(c)(2)(C)), as amended by section 321(a)(9) of the Social 
     Security Independence and Program Improvements Act of 1994, 
     is amended--
       (1) in clause (i), by striking ``may require'' and 
     inserting ``shall require'';
       (2) in clause (ii), by inserting after the 1st sentence the 
     following: ``In the administration of any law involving the 
     issuance of a marriage certificate or license, each State 
     shall require each party named in the certificate or license 
     to furnish to the State (or political subdivision thereof), 
     or any State agency having administrative responsibility for 
     the law involved, the social security number of the party.'';
       (3) in clause (ii), by inserting ``or marriage 
     certificate'' after ``Such numbers shall not be recorded on 
     the birth certificate''.
       (4) in clause (vi), by striking ``may'' and inserting 
     ``shall''; and
       (5) by adding at the end the following new clauses:
       ``(x) An agency of a State (or a political subdivision 
     thereof) charged with the administration of any law 
     concerning the issuance or renewal of a license, certificate, 
     permit, or other authorization to engage in a profession, an 
     occupation, or a commercial activity shall require all 
     applicants for issuance or renewal of the license, 
     certificate, permit, or other authorization to provide the 
     applicant's social security number to the agency for the 
     purpose of administering such laws, and for the purpose of 
     responding to requests for information from an agency 
     operating pursuant to part D of title IV.
       ``(xi) All divorce decrees, support orders, and paternity 
     determinations issued, and all paternity acknowledgments 
     made, in each State shall include the social security number 
     of each party to the decree, order, determination, or 
     acknowledgment in the records relating to the matter, for the 
     purpose of responding to requests for information from an 
     agency operating pursuant to part D of title IV.''.

          CHAPTER 3--STREAMLINING AND UNIFORMITY OF PROCEDURES

     SEC. 4321. ADOPTION OF UNIFORM STATE LAWS.

       Section 466 (42 U.S.C. 666) is amended by adding at the end 
     the following new subsection:
       ``(f) Uniform Interstate Family Support Act.--
       ``(1) Enactment and use.--In order to satisfy section 
     454(20)(A), on and after January 1, 1998, each State must 
     have in effect the Uniform Interstate Family Support Act, as 
     approved by the American Bar Association on February 9, 1993, 
     together with any amendments officially adopted before 
     January 1, 1998 by the National Conference of Commissioners 
     on Uniform State Laws.
       ``(2) Employers to follow procedural rules of State where 
     employee works.--The State law enacted pursuant to paragraph 
     (1) shall provide that an employer that receives an income 
     withholding order or notice pursuant to section 501 of the 
     Uniform Interstate Family Support Act follow the procedural 
     rules that apply with respect to such order or notice under 
     the laws of the State in which the obligor works.''.

     SEC. 4322. IMPROVEMENTS TO FULL FAITH AND CREDIT FOR CHILD 
                   SUPPORT ORDERS.

       Section 1738B of title 28, United States Code, is amended--
       (1) in subsection (a)(2), by striking ``subsection (e)'' 
     and inserting ``subsections (e), (f), and (i)'';
       (2) in subsection (b), by inserting after the 2nd 
     undesignated paragraph the following:
       `` `child's home State' means the State in which a child 
     lived with a parent or a person acting as parent for at least 
     6 consecutive months immediately preceding the time of filing 
     of a petition or comparable pleading for support and, if a 
     child is less than 6 months old, the State in which the child 
     lived from birth with any of them. A period of temporary 
     absence of any of them is counted as part of the 6-month 
     period.'';
       (3) in subsection (c), by inserting ``by a court of a 
     State'' before ``is made'';
       (4) in subsection (c)(1), by inserting ``and subsections 
     (e), (f), and (g)'' after ``located'';
       (5) in subsection (d)--
       (A) by inserting ``individual'' before ``contestant''; and
       (B) by striking ``subsection (e)'' and inserting 
     ``subsections (e) and (f)'';
       (6) in subsection (e), by striking ``make a modification of 
     a child support order with respect to a child that is made'' 
     and inserting ``modify a child support order issued'';
       (7) in subsection (e)(1), by inserting ``pursuant to 
     subsection (i)'' before the semicolon;
       (8) in subsection (e)(2)--
       (A) by inserting ``individual'' before ``contestant'' each 
     place such term appears; and
       (B) by striking ``to that court's making the modification 
     and assuming'' and inserting ``with the State of continuing, 
     exclusive jurisdiction for a court of another State to modify 
     the order and assume'';
       (9) by redesignating subsections (f) and (g) as subsections 
     (g) and (h), respectively;
       (10) by inserting after subsection (e) the following new 
     subsection:
       ``(f) Recognition of Child Support Orders.--If 1 or more 
     child support orders have been issued with regard to an 
     obligor and a child, a court shall apply the following rules 
     in determining which order to recognize for purposes of 
     continuing, exclusive jurisdiction and enforcement:
       ``(1) If only 1 court has issued a child support order, the 
     order of that court must be recognized.
       ``(2) If 2 or more courts have issued child support orders 
     for the same obligor and child, and only 1 of the courts 
     would have continuing, exclusive jurisdiction under this 
     section, the order of that court must be recognized.
       ``(3) If 2 or more courts have issued child support orders 
     for the same obligor and child, and more than 1 of the courts 
     would have continuing, exclusive jurisdiction under this 
     section, an order issued by a court in the current home State 
     of the child must be recognized, but if an order has not been 
     issued in the current home State of the child, the order most 
     recently issued must be recognized.
       ``(4) If 2 or more courts have issued child support orders 
     for the same obligor and child, and none of the courts would 
     have continuing, exclusive jurisdiction under this section, a 
     court may issue a child support order, which must be 
     recognized.
       ``(5) The court that has issued an order recognized under 
     this subsection is the court having continuing, exclusive 
     jurisdiction.'';
       (11) in subsection (g) (as so redesignated)--
       (A) by striking ``Prior'' and inserting ``Modified''; and
       (B) by striking ``subsection (e)'' and inserting 
     ``subsections (e) and (f)'';
       (12) in subsection (h) (as so redesignated)--
       (A) in paragraph (2), by inserting ``including the duration 
     of current payments and other obligations of support'' before 
     the comma; and
       (B) in paragraph (3), by inserting ``arrears under'' after 
     ``enforce''; and
       (13) by adding at the end the following new subsection:
       ``(i) Registration for Modification.--If there is no 
     individual contestant or child residing in the issuing State, 
     the party or support enforcement agency seeking to modify, or 
     to modify and enforce, a child support order issued in 
     another State shall register that order in a State with 
     jurisdiction over the nonmovant for the purpose of 
     modification.''.

     SEC. 4323. ADMINISTRATIVE ENFORCEMENT IN INTERSTATE CASES.

       Section 466(a) (42 U.S.C. 666(a)), as amended by sections 
     4315 and 4317(a) of this Act, is amended by inserting after 
     paragraph (13) the following new paragraph:

[[Page H7875]]

       ``(14) Administrative enforcement in interstate cases.--
     Procedures under which--
       ``(A)(i) the State shall respond within 5 business days to 
     a request made by another State to enforce a support order; 
     and
       ``(ii) the term `business day' means a day on which State 
     offices are open for regular business;
       ``(B) the State may, by electronic or other means, transmit 
     to another State a request for assistance in a case involving 
     the enforcement of a support order, which request--
       ``(i) shall include such information as will enable the 
     State to which the request is transmitted to compare the 
     information about the case to the information in the data 
     bases of the State; and
       ``(ii) shall constitute a certification by the requesting 
     State--

       ``(I) of the amount of support under the order the payment 
     of which is in arrears; and
       ``(II) that the requesting State has complied with all 
     procedural due process requirements applicable to the case;

       ``(C) if the State provides assistance to another State 
     pursuant to this paragraph with respect to a case, neither 
     State shall consider the case to be transferred to the 
     caseload of such other State; and
       ``(D) the State shall maintain records of--
       ``(i) the number of such requests for assistance received 
     by the State;
       ``(ii) the number of cases for which the State collected 
     support in response to such a request; and
       ``(iii) the amount of such collected support.''.

     SEC. 4324. USE OF FORMS IN INTERSTATE ENFORCEMENT.

       (a) Promulgation.--Section 452(a) (42 U.S.C. 652(a)) is 
     amended--
       (1) by striking ``and'' at the end of paragraph (9);
       (2) by striking the period at the end of paragraph (10) (as 
     amended by section 4346(a) of this Act) and inserting ``; 
     and''; and
       (3) by adding at the end the following new paragraph:
       ``(11) not later than October 1, 1996, after consulting 
     with the State directors of programs under this part, 
     promulgate forms to be used by States in interstate cases 
     for--
       ``(A) collection of child support through income 
     withholding;
       ``(B) imposition of liens; and
       ``(C) administrative subpoenas.''.
       (b) Use by States.--Section 454(9) (42 U.S.C. 654(9)) is 
     amended--
       (1) by striking ``and'' at the end of subparagraph (C);
       (2) by inserting ``and'' at the end of subparagraph (D); 
     and
       (3) by adding at the end the following new subparagraph:
       ``(E) not later than March 1, 1997, in using the forms 
     promulgated pursuant to section 452(a)(11) for income 
     withholding, imposition of liens, and issuance of 
     administrative subpoenas in interstate child support 
     cases;''.

     SEC. 4325. STATE LAWS PROVIDING EXPEDITED PROCEDURES.

       (a) State Law Requirements.--Section 466 (42 U.S.C. 666), 
     as amended by section 4314 of this Act, is amended--
       (1) in subsection (a)(2), by striking the first sentence 
     and inserting the following: ``Expedited administrative and 
     judicial procedures (including the procedures specified in 
     subsection (c)) for establishing paternity and for 
     establishing, modifying, and enforcing support 
     obligations.''; and
       (2) by inserting after subsection (b) the following new 
     subsection:
       ``(c) Expedited Procedures.--The procedures specified in 
     this subsection are the following:
       ``(1) Administrative action by state agency.--Procedures 
     which give the State agency the authority to take the 
     following actions relating to establishment of paternity or 
     to establishment, modification, or enforcement of support 
     orders, without the necessity of obtaining an order from any 
     other judicial or administrative tribunal, and to recognize 
     and enforce the authority of State agencies of other States 
     to take the following actions:
       ``(A) Genetic testing.--To order genetic testing for the 
     purpose of paternity establishment as provided in section 
     466(a)(5).
       ``(B) Financial or other information.--To subpoena any 
     financial or other information needed to establish, modify, 
     or enforce a support order, and to impose penalties for 
     failure to respond to such a subpoena.
       ``(C) Response to state agency request.--To require all 
     entities in the State (including for-profit, nonprofit, and 
     governmental employers) to provide promptly, in response to a 
     request by the State agency of that or any other State 
     administering a program under this part, information on the 
     employment, compensation, and benefits of any individual 
     employed by such entity as an employee or contractor, and to 
     sanction failure to respond to any such request.
       ``(D) Access to information contained in certain records.--
     To obtain access, subject to safeguards on privacy and 
     information security, and subject to the nonliability of 
     entities that afford such access under this subparagraph, 
     to information contained in the following records 
     (including automated access, in the case of records 
     maintained in automated data bases):
       ``(i) Records of other State and local government agencies, 
     including--

       ``(I) vital statistics (including records of marriage, 
     birth, and divorce);
       ``(II) State and local tax and revenue records (including 
     information on residence address, employer, income and 
     assets);
       ``(III) records concerning real and titled personal 
     property;
       ``(IV) records of occupational and professional licenses, 
     and records concerning the ownership and control of 
     corporations, partnerships, and other business entities;
       ``(V) employment security records;
       ``(VI) records of agencies administering public assistance 
     programs;
       ``(VII) records of the motor vehicle department; and
       ``(VIII) corrections records.

       ``(ii) Certain records held by private entities with 
     respect to individuals who owe or are owed support (or 
     against or with respect to whom a support obligation is 
     sought), consisting of--

       ``(I) the names and addresses of such individuals and the 
     names and addresses of the employers of such individuals, as 
     appearing in customer records of public utilities and cable 
     television companies, pursuant to an administrative subpoena 
     authorized by subparagraph (B); and
       ``(II) information (including information on assets and 
     liabilities) on such individuals held by financial 
     institutions.

       ``(E) Change in payee.--In cases in which support is 
     subject to an assignment in order to comply with a 
     requirement imposed pursuant to part A or section 1912, or to 
     a requirement to pay through the State disbursement unit 
     established pursuant to section 454B, upon providing notice 
     to obligor and obligee, to direct the obligor or other payor 
     to change the payee to the appropriate government entity.
       ``(F) Income withholding.--To order income withholding in 
     accordance with subsections (a)(1)(A) and (b) of section 466.
       ``(G) Securing assets.--In cases in which there is a 
     support arrearage, to secure assets to satisfy the arrearage 
     by--
       ``(i) intercepting or seizing periodic or lump-sum payments 
     from--

       ``(I) a State or local agency, including unemployment 
     compensation, workers' compensation, and other benefits; and
       ``(II) judgments, settlements, and lotteries;

       ``(ii) attaching and seizing assets of the obligor held in 
     financial institutions;
       ``(iii) attaching public and private retirement funds; and
       ``(iv) imposing liens in accordance with subsection (a)(4) 
     and, in appropriate cases, to force sale of property and 
     distribution of proceeds.
       ``(H) Increase monthly payments.--For the purpose of 
     securing overdue support, to increase the amount of monthly 
     support payments to include amounts for arrearages, subject 
     to such conditions or limitations as the State may provide.

     Such procedures shall be subject to due process safeguards, 
     including (as appropriate) requirements for 
     notice, opportunity to contest the action, and opportunity 
     for an appeal on the record to an independent 
     administrative or judicial tribunal.
       ``(2) Substantive and procedural rules.--The expedited 
     procedures required under subsection (a)(2) shall include the 
     following rules and authority, applicable with respect to all 
     proceedings to establish paternity or to establish, modify, 
     or enforce support orders:
       ``(A) Locator information; presumptions concerning 
     notice.--Procedures under which--
       ``(i) each party to any paternity or child support 
     proceeding is required (subject to privacy safeguards) to 
     file with the tribunal and the State case registry upon entry 
     of an order, and to update as appropriate, information on 
     location and identity of the party, including social security 
     number, residential and mailing addresses, telephone number, 
     driver's license number, and name, address, and telephone 
     number of employer; and
       ``(ii) in any subsequent child support enforcement action 
     between the parties, upon sufficient showing that diligent 
     effort has been made to ascertain the location of such a 
     party, the tribunal may deem State due process requirements 
     for notice and service of process to be met with respect to 
     the party, upon delivery of written notice to the most recent 
     residential or employer address filed with the tribunal 
     pursuant to clause (i).
       ``(B) Statewide jurisdiction.--Procedures under which--
       ``(i) the State agency and any administrative or judicial 
     tribunal with authority to hear child support and paternity 
     cases exerts statewide jurisdiction over the parties; and
       ``(ii) in a State in which orders are issued by courts or 
     administrative tribunals, a case may be transferred between 
     local jurisdictions in the State without need for any 
     additional filing by the petitioner, or service of process 
     upon the respondent, to retain jurisdiction over the parties.
       ``(3) Coordination with erisa.--Notwithstanding subsection 
     (d) of section 514 of the Employee Retirement Income Security 
     Act of 1974 (relating to effect on other laws), nothing in 
     this subsection shall be construed to alter, amend, modify, 
     invalidate, impair, or supersede subsections (a), (b), and 
     (c) of such section 514 as it applies with respect to any 
     procedure referred to in paragraph (1) and any expedited 
     procedure referred to in paragraph (2), except to the extent 
     that such procedure would be consistent with the requirements 
     of section 206(d)(3) of such Act (relating to qualified 
     domestic relations orders) or the requirements of section 
     609(a) of

[[Page H7876]]

     such Act (relating to qualified medical child support orders) 
     if the reference in such section 206(d)(3) to a domestic 
     relations order and the reference in such section 609(a) to a 
     medical child support order were a reference to a support 
     order referred to in paragraphs (1) and (2) relating to the 
     same matters, respectively.''.
       (b) Automation of State Agency Functions.--Section 454A, as 
     added by section 4344(a)(2) and as amended by sections 4311 
     and 4312(c) of this Act, is amended by adding at the end the 
     following new subsection:
       ``(h) Expedited Administrative Procedures.--The automated 
     system required by this section shall be used, to the maximum 
     extent feasible, to implement the expedited administrative 
     procedures required by section 466(c).''.

                   CHAPTER 4--PATERNITY ESTABLISHMENT

     SEC. 4331. STATE LAWS CONCERNING PATERNITY ESTABLISHMENT.

       (a) State Laws Required.--Section 466(a)(5) (42 U.S.C. 
     666(a)(5)) is amended to read as follows:
       ``(5) Procedures concerning paternity establishment.--
       ``(A) Establishment process available from birth until age 
     18.--
       ``(i) Procedures which permit the establishment of the 
     paternity of a child at any time before the child attains 18 
     years of age.
       ``(ii) As of August 16, 1984, clause (i) shall also apply 
     to a child for whom paternity has not been established or for 
     whom a paternity action was brought but dismissed because a 
     statute of limitations of less than 18 years was then in 
     effect in the State.
       ``(B) Procedures concerning genetic testing.--
       ``(i) Genetic testing required in certain contested 
     cases.--Procedures under which the State is required, in a 
     contested paternity case (unless otherwise barred by State 
     law) to require the child and all other parties (other than 
     individuals found under section 454(29) to have good cause 
     and other exceptions for refusing to cooperate) to submit to 
     genetic tests upon the request of any such party, if the 
     request is supported by a sworn statement by the party--

       ``(I) alleging paternity, and setting forth facts 
     establishing a reasonable possibility of the requisite sexual 
     contact between the parties; or
       ``(II) denying paternity, and setting forth facts 
     establishing a reasonable possibility of the nonexistence of 
     sexual contact between the parties.

       ``(ii) Other requirements.--Procedures which require the 
     State agency, in any case in which the agency orders genetic 
     testing--

       ``(I) to pay costs of such tests, subject to recoupment (if 
     the State so elects) from the alleged father if paternity is 
     established; and
       ``(II) to obtain additional testing in any case if an 
     original test result is contested, upon request and advance 
     payment by the contestant.

       ``(C) Voluntary paternity acknowledgment.--
       ``(i) Simple civil process.--Procedures for a simple civil 
     process for voluntarily acknowledging paternity under which 
     the State must provide that, before a mother and a putative 
     father can sign an acknowledgment of paternity, the mother 
     and the putative father must be given notice, orally and in 
     writing, of the alternatives to, the legal consequences of, 
     and the rights (including, if 1 parent is a minor, any rights 
     afforded due to minority status) and responsibilities that 
     arise from, signing the acknowledgment.
       ``(ii) Hospital-based program.--Such procedures must 
     include a hospital-based program for the voluntary 
     acknowledgment of paternity focusing on the period 
     immediately before or after the birth of a child.
       ``(iii) Paternity establishment services.--

       ``(I) State-offered services.--Such procedures must require 
     the State agency responsible for maintaining birth records to 
     offer voluntary paternity establishment services.
       ``(II) Regulations.--

       ``(aa) Services offered by hospitals and birth record 
     agencies.--The Secretary shall prescribe regulations 
     governing voluntary paternity establishment services offered 
     by hospitals and birth record agencies.
       ``(bb) Services offered by other entities.--The Secretary 
     shall prescribe regulations specifying the types of other 
     entities that may offer voluntary paternity establishment 
     services, and governing the provision of such services, 
     which shall include a requirement that such an entity must 
     use the same notice provisions used by, use the same 
     materials used by, provide the personnel providing such 
     services with the same training provided by, and evaluate 
     the provision of such services in the same manner as the 
     provision of such services is evaluated by, voluntary 
     paternity establishment programs of hospitals and birth 
     record agencies.
       ``(iv) Use of paternity acknowledgment affidavit.--Such 
     procedures must require the State to develop and use an 
     affidavit for the voluntary acknowledgment of paternity which 
     includes the minimum requirements of the affidavit specified 
     by the Secretary under section 452(a)(7) for the voluntary 
     acknowledgment of paternity, and to give full faith and 
     credit to such an affidavit signed in any other State 
     according to its procedures.
       ``(D) Status of signed paternity acknowledgment.--
       ``(i) Inclusion in birth records.--Procedures under which 
     the name of the father shall be included on the record of 
     birth of the child of unmarried parents only if--

       ``(I) the father and mother have signed a voluntary 
     acknowledgment of paternity; or
       ``(II) a court or an administrative agency of competent 
     jurisdiction has issued an adjudication of paternity.

     Nothing in this clause shall preclude a State agency from 
     obtaining an admission of paternity from the father for 
     submission in a judicial or administrative proceeding, or 
     prohibit the issuance of an order in a judicial or 
     administrative proceeding which bases a legal finding of 
     paternity on an admission of paternity by the father and any 
     other additional showing required by State law.
       ``(ii) Legal finding of paternity.--Procedures under which 
     a signed voluntary acknowledgment of paternity is considered 
     a legal finding of paternity, subject to the right of any 
     signatory to rescind the acknowledgment within the earlier 
     of--

       ``(I) 60 days; or
       ``(II) the date of an administrative or judicial proceeding 
     relating to the child (including a proceeding to establish a 
     support order) in which the signatory is a party.

       ``(iii) Contest.--Procedures under which, after the 60-day 
     period referred to in clause (ii), a signed voluntary 
     acknowledgment of paternity may be challenged in court only 
     on the basis of fraud, duress, or material mistake of fact, 
     with the burden of proof upon the challenger, and under which 
     the legal responsibilities (including child support 
     obligations) of any signatory arising from the acknowledgment 
     may not be suspended during the challenge, except for good 
     cause shown.
       ``(E) Bar on acknowledgment ratification proceedings.--
     Procedures under which judicial or administrative proceedings 
     are not required or permitted to ratify an unchallenged 
     acknowledgment of paternity.
       ``(F) Admissibility of genetic testing results.--
     Procedures--
       ``(i) requiring the admission into evidence, for purposes 
     of establishing paternity, of the results of any genetic test 
     that is--

       ``(I) of a type generally acknowledged as reliable by 
     accreditation bodies designated by the Secretary; and

       ``(II) performed by a laboratory approved by such an 
     accreditation body;

       ``(ii) requiring an objection to genetic testing results to 
     be made in writing not later than a specified number of days 
     before any hearing at which the results may be introduced 
     into evidence (or, at State option, not later than a 
     specified number of days after receipt of the results); and
       ``(iii) making the test results admissible as evidence of 
     paternity without the need for foundation testimony or other 
     proof of authenticity or accuracy, unless objection is made.
       ``(G) Presumption of paternity in certain cases.--
     Procedures which create a rebuttable or, at the option of the 
     State, conclusive presumption of paternity upon genetic 
     testing results indicating a threshold probability that the 
     alleged father is the father of the child.
       ``(H) Default orders.--Procedures requiring a default order 
     to be entered in a paternity case upon a showing of service 
     of process on the defendant and any additional showing 
     required by State law.
       ``(I) No right to jury trial.--Procedures providing that 
     the parties to an action to establish paternity are not 
     entitled to a trial by jury.
       ``(J) Temporary support order based on probable paternity 
     in contested cases.--Procedures which require that a 
     temporary order be issued, upon motion by a party, requiring 
     the provision of child support pending an administrative or 
     judicial determination of parentage, if there is clear and 
     convincing evidence of paternity (on the basis of genetic 
     tests or other evidence).
       ``(K) Proof of certain support and paternity establishment 
     costs.--Procedures under which bills for pregnancy, 
     childbirth, and genetic testing are admissible as evidence 
     without requiring third-party foundation testimony, and shall 
     constitute prima facie evidence of amounts incurred for such 
     services or for testing on behalf of the child.
       ``(L) Standing of putative fathers.--Procedures ensuring 
     that the putative father has a reasonable opportunity to 
     initiate a paternity action.
       ``(M) Filing of acknowledgments and adjudications in state 
     registry of birth records.--Procedures under which voluntary 
     acknowledgments and adjudications of paternity by judicial or 
     administrative processes are filed with the State registry of 
     birth records for comparison with information in the State 
     case registry.''.
       (b) National Paternity Acknowledgment Affidavit.--Section 
     452(a)(7) (42 U.S.C. 652(a)(7)) is amended by inserting ``, 
     and specify the minimum requirements of an affidavit to be 
     used for the voluntary acknowledgment of paternity which 
     shall include the social security number of each parent and, 
     after consultation with the States, other common elements as 
     determined by such designee'' before the semicolon.
       (c) Conforming Amendment.--Section 468 (42 U.S.C. 668) is 
     amended by striking ``a simple civil process for voluntarily 
     acknowledging paternity and''.

     SEC. 4332. OUTREACH FOR VOLUNTARY PATERNITY ESTABLISHMENT.

       Section 454(23) (42 U.S.C. 654(23)) is amended by inserting 
     ``and will publicize the availability and encourage the use 
     of procedures for voluntary establishment of paternity and

[[Page H7877]]

     child support by means the State deems appropriate'' before 
     the semicolon.

     SEC. 4333. COOPERATION BY APPLICANTS FOR AND RECIPIENTS OF 
                   PART A ASSISTANCE.

       Section 454 (42 U.S.C. 654), as amended by sections 
     4301(b), 4303(a), 4312(a), and 4313(a) of this Act, is 
     amended--
       (1) by striking ``and'' at the end of paragraph (27);
       (2) by striking the period at the end of paragraph (28) and 
     inserting ``; and''; and
       (3) by inserting after paragraph (28) the following new 
     paragraph:
       ``(29) provide that the State agency responsible for 
     administering the State plan--
       ``(A) shall make the determination (and redetermination at 
     appropriate intervals) as to whether an individual who has 
     applied for or is receiving assistance under the State 
     program funded under part A of this title or the State 
     program under title XIX is cooperating in good faith with the 
     State in establishing the paternity of, or in establishing, 
     modifying, or enforcing a support order for, any child of the 
     individual by providing the State agency with the name of, 
     and such other information as the State agency may require 
     with respect to, the noncustodial parent of the child, 
     subject to good cause and other exceptions which--
       ``(i) shall be defined, taking into account the best 
     interests of the child, and
       ``(ii) shall be applied in each case,

     by, at the option of the State, the State agency 
     administering the State program under part A, this part, or 
     title XIX;
       ``(B) shall require the individual to supply additional 
     necessary information and appear at interviews, hearings, and 
     legal proceedings;
       ``(C) shall require the individual and the child to submit 
     to genetic tests pursuant to judicial or administrative 
     order;
       ``(D) may request that the individual sign a voluntary 
     acknowledgment of paternity, after notice of the rights and 
     consequences of such an acknowledgment, but may not require 
     the individual to sign an acknowledgment or otherwise 
     relinquish the right to genetic tests as a condition of 
     cooperation and eligibility for assistance under the State 
     program funded under part A, or the State program under title 
     XIX; and
       ``(E) shall promptly notify the individual, the State 
     agency administering the State program funded under part A, 
     and the State agency administering the State program under 
     title XIX, of each such determination, and if noncooperation 
     is determined, the basis therefor.''.

             CHAPTER 5--PROGRAM ADMINISTRATION AND FUNDING

     SEC. 4341. PERFORMANCE-BASED INCENTIVES AND PENALTIES.

       (a) Development of New System.--The Secretary of Health and 
     Human Services, in consultation with State directors of 
     programs under part D of title IV of the Social Security Act, 
     shall develop a new incentive system to replace, in a revenue 
     neutral manner, the system under section 458 of such Act. The 
     new system shall provide additional payments to any State 
     based on such State's performance under such a program. Not 
     later than November 1, 1996, the Secretary shall report on 
     the new system to the Committee on Ways and Means of the 
     House of Representatives and the Committee on Finance of the 
     Senate.
       (b) Conforming Amendments to Present System.--Section 458 
     (42 U.S.C. 658) is amended--
       (1) in subsection (a), by striking ``aid to families with 
     dependent children under a State plan approved under part A 
     of this title'' and inserting ``assistance under a program 
     funded under part A'';
       (2) in subsection (b)(1)(A), by striking ``section 
     402(a)(26)'' and inserting ``section 408(a)(4)'';
       (3) in subsections (b) and (c)--
       (A) by striking ``AFDC collections'' each place it appears 
     and inserting ``title IV-A collections'', and
       (B) by striking ``non-AFDC collections'' each place it 
     appears and inserting ``non-title IV-A collections''; and
       (4) in subsection (c), by striking ``combined AFDC/non-AFDC 
     administrative costs'' both places it appears and inserting 
     ``combined title IV-A/non-title IV-A administrative costs''.
       (c) Calculation of Paternity Establishment Percentage.--
       (1) Section 452(g)(1)(A) (42 U.S.C. 652(g)(1)(A)) is 
     amended by striking ``75'' and inserting ``90''.
       (2) Section 452(g)(1) (42 U.S.C. 652(g)(1)) is amended--
       (A) by redesignating subparagraphs (B) through (E) as 
     subparagraphs (C) through (F), respectively, and by inserting 
     after subparagraph (A) the following new subparagraph:
       ``(B) for a State with a paternity establishment percentage 
     of not less than 75 percent but less than 90 percent for such 
     fiscal year, the paternity establishment percentage of the 
     State for the immediately preceding fiscal year plus 2 
     percentage points;''; and
       (B) by adding at the end the following new flush sentence:
     ``In determining compliance under this section, a State may 
     use as its paternity establishment percentage either the 
     State's IV-D paternity establishment percentage (as defined 
     in paragraph (2)(A)) or the State's statewide paternity 
     establishment percentage (as defined in paragraph (2)(B)).''.
       (3) Section 452(g)(2) (42 U.S.C. 652(g)(2)) is amended--
       (A) in subparagraph (A)--
       (i) in the matter preceding clause (i)--

       (I) by striking ``paternity establishment percentage'' and 
     inserting ``IV-D paternity establishment percentage''; and
       (II) by striking ``(or all States, as the case may be)''; 
     and

       (ii) by striking ``and'' at the end; and
       (B) by redesignating subparagraph (B) as subparagraph (C) 
     and by inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) the term `statewide paternity establishment 
     percentage' means, with respect to a State for a fiscal year, 
     the ratio (expressed as a percentage) that the total number 
     of minor children--
       ``(i) who have been born out of wedlock, and
       ``(ii) the paternity of whom has been established or 
     acknowledged during the fiscal year,

     bears to the total number of children born out of wedlock 
     during the preceding fiscal year; and''.
       (4) Section 452(g)(3) (42 U.S.C. 652(g)(3)) is amended--
       (A) by striking subparagraph (A) and redesignating 
     subparagraphs (B) and (C) as subparagraphs (A) and (B), 
     respectively; and
       (B) in subparagraph (A) (as so redesignated), by striking 
     ``the percentage of children born out-of-wedlock in a State'' 
     and inserting ``the percentage of children in a State who are 
     born out of wedlock or for whom support has not been 
     established''.
       (d) Effective Dates.--
       (1) Incentive adjustments.--
       (A) In general.--The system developed under subsection (a) 
     and the amendments made by subsection (b) shall become 
     effective on October 1, 1998, except to the extent provided 
     in subparagraph (B).
       (B) Application of section 458.--Section 458 of the Social 
     Security Act, as in effect on the day before the date of the 
     enactment of this section, shall be effective for purposes of 
     incentive payments to States for fiscal years before fiscal 
     year 1999.
       (2) Penalty reductions.--The amendments made by subsection 
     (c) shall become effective with respect to calendar quarters 
     beginning on or after the date of the enactment of this Act.

     SEC. 4342. FEDERAL AND STATE REVIEWS AND AUDITS.

       (a) State Agency Activities.--Section 454 (42 U.S.C. 654) 
     is amended--
       (1) in paragraph (14), by striking ``(14)'' and inserting 
     ``(14)(A)'';
       (2) by redesignating paragraph (15) as subparagraph (B) of 
     paragraph (14); and
       (3) by inserting after paragraph (14) the following new 
     paragraph:
       ``(15) provide for--
       ``(A) a process for annual reviews of and reports to the 
     Secretary on the State program operated under the State plan 
     approved under this part, including such information as may 
     be necessary to measure State compliance with Federal 
     requirements for expedited procedures, using such standards 
     and procedures as are required by the Secretary, under which 
     the State agency will determine the extent to which the 
     program is operated in compliance with this part; and
       ``(B) a process of extracting from the automated data 
     processing system required by paragraph (16) and transmitting 
     to the Secretary data and calculations concerning the levels 
     of accomplishment (and rates of improvement) with respect to 
     applicable performance indicators (including paternity 
     establishment percentages) to the extent necessary for 
     purposes of sections 452(g) and 458;''.
       (b) Federal Activities.--Section 452(a)(4) (42 U.S.C. 
     652(a)(4)) is amended to read as follows:
       ``(4)(A) review data and calculations transmitted by State 
     agencies pursuant to section 454(15)(B) on State program 
     accomplishments with respect to performance indicators for 
     purposes of subsection (g) of this section and section 458;
       ``(B) review annual reports submitted pursuant to section 
     454(15)(A) and, as appropriate, provide to the State 
     comments, recommendations for additional or alternative 
     corrective actions, and technical assistance; and
       ``(C) conduct audits, in accordance with the Government 
     auditing standards of the Comptroller General of the United 
     States--
       ``(i) at least once every 3 years (or more frequently, in 
     the case of a State which fails to meet the requirements of 
     this part concerning performance standards and reliability of 
     program data) to assess the completeness, reliability, and 
     security of the data and the accuracy of the reporting 
     systems used in calculating performance indicators under 
     subsection (g) of this section and section 458;
       ``(ii) of the adequacy of financial management of the State 
     program operated under the State plan approved under this 
     part, including assessments of--
       ``(I) whether Federal and other funds made available to 
     carry out the State program are being appropriately expended, 
     and are properly and fully accounted for; and
       ``(II) whether collections and disbursements of support 
     payments are carried out correctly and are fully accounted 
     for; and
       ``(iii) for such other purposes as the Secretary may find 
     necessary;''.
       (c) Effective Date.--The amendments made by this section 
     shall be effective with respect to calendar quarters 
     beginning 12 months or more after the date of the enactment 
     of this Act.

[[Page H7878]]

     SEC. 4343. REQUIRED REPORTING PROCEDURES.

       (a) Establishment.--Section 452(a)(5) (42 U.S.C. 652(a)(5)) 
     is amended by inserting ``, and establish procedures to be 
     followed by States for collecting and reporting information 
     required to be provided under this part, and establish 
     uniform definitions (including those necessary to enable the 
     measurement of State compliance with the requirements of this 
     part relating to expedited processes) to be applied in 
     following such procedures'' before the semicolon.
       (b) State Plan Requirement.--Section 454 (42 U.S.C. 654), 
     as amended by sections 4301(b), 4303(a), 4312(a), 4313(a), 
     and 4333 of this Act, is amended--
       (1) by striking ``and'' at the end of paragraph (28);
       (2) by striking the period at the end of paragraph (29) and 
     inserting ``; and''; and
       (3) by adding after paragraph (29) the following new 
     paragraph:
       ``(30) provide that the State shall use the definitions 
     established under section 452(a)(5) in collecting and 
     reporting information as required under this part.''.

     SEC. 4344. AUTOMATED DATA PROCESSING REQUIREMENTS.

       (a) Revised Requirements.--
       (1) In general.--Section 454(16) (42 U.S.C. 654(16)) is 
     amended--
       (A) by striking ``, at the option of the State,'';
       (B) by inserting ``and operation by the State agency'' 
     after ``for the establishment'';
       (C) by inserting ``meeting the requirements of section 
     454A'' after ``information retrieval system'';
       (D) by striking ``in the State and localities thereof, so 
     as (A)'' and inserting ``so as'';
       (E) by striking ``(i)''; and
       (F) by striking ``(including'' and all that follows and 
     inserting a semicolon.
       (2) Automated data processing.--Part D of title IV (42 
     U.S.C. 651-669) is amended by inserting after section 454 the 
     following new section:

     ``SEC. 454A. AUTOMATED DATA PROCESSING.

       ``(a) In General.--In order for a State to meet the 
     requirements of this section, the State agency administering 
     the State program under this part shall have in operation a 
     single statewide automated data processing and information 
     retrieval system which has the capability to perform the 
     tasks specified in this section with the frequency and in the 
     manner required by or under this part.
       ``(b) Program Management.--The automated system required by 
     this section shall perform such functions as the Secretary 
     may specify relating to management of the State program under 
     this part, including--
       ``(1) controlling and accounting for use of Federal, State, 
     and local funds in carrying out the program; and
       ``(2) maintaining the data necessary to meet Federal 
     reporting requirements under this part on a timely basis.
       ``(c) Calculation of Performance Indicators.--In order to 
     enable the Secretary to determine the incentive payments and 
     penalty adjustments required by sections 452(g) and 458, the 
     State agency shall--
       ``(1) use the automated system--
       ``(A) to maintain the requisite data on State performance 
     with respect to paternity establishment and child support 
     enforcement in the State; and
       ``(B) to calculate the paternity establishment percentage 
     for the State for each fiscal year; and
       ``(2) have in place systems controls to ensure the 
     completeness and reliability of, and ready access to, the 
     data described in paragraph (1)(A), and the accuracy of the 
     calculations described in paragraph (1)(B).
       ``(d) Information Integrity and Security.--The State agency 
     shall have in effect safeguards on the integrity, accuracy, 
     and completeness of, access to, and use of data in the 
     automated system required by this section, which shall 
     include the following (in addition to such other safeguards 
     as the Secretary may specify in regulations):
       ``(1) Policies restricting access.--Written policies 
     concerning access to data by State agency personnel, and 
     sharing of data with other persons, which--
       ``(A) permit access to and use of data only to the extent 
     necessary to carry out the State program under this part; and
       ``(B) specify the data which may be used for particular 
     program purposes, and the personnel permitted access to such 
     data.
       ``(2) Systems controls.--Systems controls (such as 
     passwords or blocking of fields) to ensure strict adherence 
     to the policies described in paragraph (1).
       ``(3) Monitoring of access.--Routine monitoring of access 
     to and use of the automated system, through methods such as 
     audit trails and feedback mechanisms, to guard against and 
     promptly identify unauthorized access or use.
       ``(4) Training and information.--Procedures to ensure that 
     all personnel (including State and local agency staff and 
     contractors) who may have access to or be required to use 
     confidential program data are informed of applicable 
     requirements and penalties (including those in section 6103 
     of the Internal Revenue Code of 1986), and are adequately 
     trained in security procedures.
       ``(5) Penalties.--Administrative penalties (up to and 
     including dismissal from employment) for unauthorized access 
     to, or disclosure or use of, confidential data.''.
       (3) Regulations.--The Secretary of Health and Human 
     Services shall prescribe final regulations for implementation 
     of section 454A of the Social Security Act not later than 2 
     years after the date of the enactment of this Act.
       (4) Implementation timetable.--Section 454(24) (42 U.S.C. 
     654(24)), as amended by section 4303(a)(1) of this Act, is 
     amended to read as follows:
       ``(24) provide that the State will have in effect an 
     automated data processing and information retrieval system--
       ``(A) by October 1, 1997, which meets all requirements of 
     this part which were enacted on or before the date of 
     enactment of the Family Support Act of 1988, and
       ``(B) by October 1, 1999, which meets all requirements of 
     this part enacted on or before the date of the enactment of 
     the Personal Responsibility and Work Opportunity Act of 1996, 
     except that such deadline shall be extended by 1 day for each 
     day (if any) by which the Secretary fails to meet the 
     deadline imposed by section 4344(a)(3) of the Personal 
     Responsibility and Work Opportunity Act of 1996;''.
       (b) Special Federal Matching Rate for Development Costs of 
     Automated Systems.--
       (1) In general.--Section 455(a) (42 U.S.C. 655(a)) is 
     amended--
       (A) in paragraph (1)(B)--
       (i) by striking ``90 percent'' and inserting ``the percent 
     specified in paragraph (3)'';
       (ii) by striking ``so much of''; and
       (iii) by striking ``which the Secretary'' and all that 
     follows and inserting ``, and''; and
       (B) by adding at the end the following new paragraph:
       ``(3)(A) The Secretary shall pay to each State, for each 
     quarter in fiscal years 1996 and 1997, 90 percent of so much 
     of the State expenditures described in paragraph (1)(B) as 
     the Secretary finds are for a system meeting the requirements 
     specified in section 454(16) (as in effect on September 30, 
     1995) but limited to the amount approved for States in the 
     advance planning documents of such States submitted on or 
     before September 30, 1995.
       ``(B)(i) The Secretary shall pay to each State, for each 
     quarter in fiscal years 1996 through 2001, the percentage 
     specified in clause (ii) of so much of the State expenditures 
     described in paragraph (1)(B) as the Secretary finds are for 
     a system meeting the requirements of sections 454(16) and 
     454A.
       ``(ii) The percentage specified in this clause is 80 
     percent.''.
       (2) Temporary limitation on payments under special federal 
     matching rate.--
       (A) In general.--The Secretary of Health and Human Services 
     may not pay more than $400,000,000 in the aggregate under 
     section 455(a)(3)(B) of the Social Security Act for fiscal 
     years 1996 through 2001.
       (B) Allocation of limitation among states.--The total 
     amount payable to a State under section 455(a)(3)(B) of such 
     Act for fiscal years 1996 through 2001 shall not exceed the 
     limitation determined for the State by the Secretary of 
     Health and Human Services in regulations.
       (C) Allocation formula.--The regulations referred to in 
     subparagraph (B) shall prescribe a formula for allocating the 
     amount specified in subparagraph (A) among States with plans 
     approved under part D of title IV of the Social Security Act, 
     which shall take into account--
       (i) the relative size of State caseloads under such part; 
     and
       (ii) the level of automation needed to meet the automated 
     data processing requirements of such part.
       (c) Conforming Amendment.--Section 123(c) of the Family 
     Support Act of 1988 (102 Stat. 2352; Public Law 100-485) is 
     repealed.

     SEC. 4345. TECHNICAL ASSISTANCE.

       (a) For Training of Federal and State Staff, Research and 
     Demonstration Programs, and Special Projects of Regional or 
     National Significance.--Section 452 (42 U.S.C. 652) is 
     amended by adding at the end the following new subsection:
       ``(j) Out of any money in the Treasury of the United States 
     not otherwise appropriated, there is hereby appropriated to 
     the Secretary for each fiscal year an amount equal to 1 
     percent of the total amount paid to the Federal Government 
     pursuant to section 457(a) during the immediately preceding 
     fiscal year (as determined on the basis of the most recent 
     reliable data available to the Secretary as of the end of the 
     3rd calendar quarter following the end of such preceding 
     fiscal year), to cover costs incurred by the Secretary for--
       ``(1) information dissemination and technical assistance to 
     States, training of State and Federal staff, staffing 
     studies, and related activities needed to improve programs 
     under this part (including technical assistance concerning 
     State automated systems required by this part); and
       ``(2) research, demonstration, and special projects of 
     regional or national significance relating to the operation 
     of State programs under this part.

     The amount appropriated under this subsection shall remain 
     available until expended.''.
       (b) Operation of Federal Parent Locator Service.--Section 
     453 (42 U.S.C. 653), as amended by section 4316 of this Act, 
     is amended by adding at the end the following new subsection:
       ``(o) Recovery of Costs.--Out of any money in the Treasury 
     of the United States not otherwise appropriated, there is 
     hereby appropriated to the Secretary for each fiscal year an 
     amount equal to 2 percent of the total amount paid to the 
     Federal Government pursuant to section 457(a) during the 
     immediately preceding fiscal year (as determined on the basis 
     of the most recent reliable data available to the Secretary 
     as of the

[[Page H7879]]

     end of the 3rd calendar quarter following the end of such 
     preceding fiscal year), to cover costs incurred by the 
     Secretary for operation of the Federal Parent Locator Service 
     under this section, to the extent such costs are not 
     recovered through user fees.''.

     SEC. 4346. REPORTS AND DATA COLLECTION BY THE SECRETARY.

       (a) Annual Report to Congress.--
       (1) Section 452(a)(10)(A) (42 U.S.C. 652(a)(10)(A)) is 
     amended--
       (A) by striking ``this part;'' and inserting ``this part, 
     including--''; and
       (B) by adding at the end the following new clauses:
       ``(i) the total amount of child support payments collected 
     as a result of services furnished during the fiscal year to 
     individuals receiving services under this part;
       ``(ii) the cost to the States and to the Federal Government 
     of so furnishing the services; and
       ``(iii) the number of cases involving families--

       ``(I) who became ineligible for assistance under State 
     programs funded under part A during a month in the fiscal 
     year; and
       ``(II) with respect to whom a child support payment was 
     received in the month;''.

       (2) Section 452(a)(10)(C) (42 U.S.C. 652(a)(10)(C)) is 
     amended--
       (A) in the matter preceding clause (i)--
       (i) by striking ``with the data required under each clause 
     being separately stated for cases'' and inserting 
     ``separately stated for cases'';
       (ii) by striking ``cases where the child was formerly 
     receiving'' and inserting ``or formerly received'';
       (iii) by inserting ``or 1912'' after ``471(a)(17)''; and
       (iv) by inserting ``for'' before ``all other'';
       (B) in each of clauses (i) and (ii), by striking ``, and 
     the total amount of such obligations'';
       (C) in clause (iii), by striking ``described in'' and all 
     that follows and inserting ``in which support was collected 
     during the fiscal year;'';
       (D) by striking clause (iv); and
       (E) by redesignating clause (v) as clause (vii), and 
     inserting after clause (iii) the following new clauses:
       ``(iv) the total amount of support collected during such 
     fiscal year and distributed as current support;
       ``(v) the total amount of support collected during such 
     fiscal year and distributed as arrearages;
       ``(vi) the total amount of support due and unpaid for all 
     fiscal years; and''.
       (3) Section 452(a)(10)(G) (42 U.S.C. 652(a)(10)(G)) is 
     amended by striking ``on the use of Federal courts and''.
       (4) Section 452(a)(10) (42 U.S.C. 652(a)(10)) is amended--
       (A) in subparagraph (H), by striking ``and'';
       (B) in subparagraph (I), by striking the period and 
     inserting ``; and''; and
       (C) by inserting after subparagraph (I) the following new 
     subparagraph:
       ``(J) compliance, by State, with the standards established 
     pursuant to subsections (h) and (i).''.
       (5) Section 452(a)(10) (42 U.S.C. 652(a)(10)) is amended by 
     striking ``The information contained in any such report under 
     subpargraph (A)'' and all that follows through ``the State 
     plan approved under part A.''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall be effective with respect to fiscal year 1997 and 
     succeeding fiscal years.

     SEC. 4347. CHILD SUPPORT DELINQUENCY PENALTY.

       Section 454 (42 U.S.C. 654), as amended by sections 
     4301(b), 4303(a), 4312(a), 4313(a), 4333, and 4343(b) of this 
     Act, is amended--
       (1) by striking ``and'' at the end of paragraph (29);
       (2) by striking the period at the end of paragraph (30) and 
     inserting ``; and''; and
       (3) by adding after paragraph (30) the following new 
     paragraph:
       ``(31) provide that the State shall have in effect such 
     laws and procedures as may be necessary to ensure that--
       ``(A) any person who, at the end of any calendar year, is 
     delinquent in the payment of child support is civilly liable 
     to the State for a penalty in an amount equal to 10 percent 
     of the amount of the delinquency (excluding any delinquency 
     of the person with respect to which a penalty has been 
     imposed pursuant to this paragraph for a prior calendar 
     year); and
       ``(B) the State shall apply amounts collected from a person 
     described in subparagraph (A) to the payment of penalties 
     imposed pursuant to subparagraph (A), after all child support 
     delinquencies of the person have been extinguished and the 
     person has repaid the State for all public assistance 
     provided to the person owed such support, and shall remit to 
     the Federal Government an amount equal to 50 percent of the 
     amount applied to the payment of such penalties.''

      CHAPTER 6--ESTABLISHMENT AND MODIFICATION OF SUPPORT ORDERS

     SEC. 4351. SIMPLIFIED PROCESS FOR REVIEW AND ADJUSTMENT OF 
                   CHILD SUPPORT ORDERS.

       Section 466(a)(10) (42 U.S.C. 666(a)(10)) is amended to 
     read as follows:
       ``(10) Review and adjustment of support orders upon 
     request.--
       ``(A) In general.--Procedures under which--
       ``(i) upon the request of either parent, the State shall 
     review and, as appropriate, adjust each support order being 
     enforced under this part, taking into account the best 
     interests of the child involved; and
       ``(ii) upon the State's own initiative, the State may 
     review and, if appropriate, adjust any support order being 
     enforced under this part with respect to which there is an 
     assignment under part A, taking into account the best 
     interests of the child involved.Such procedures shall provide 
     the following:
       ``(B) Methods of adjustment.--Such procedures shall provide 
     that the State may elect to review and, if appropriate, 
     adjust an order--
       ``(i) by reviewing and, if appropriate, adjusting the order 
     in accordance with the guidelines established pursuant to 
     section 467(a) if the amount of the child support award under 
     the order differs from the amount that would be awarded in 
     accordance with the guidelines;
       ``(ii) by applying a cost-of-living adjustment to the order 
     in accordance with a formula developed by the State and 
     permit either party to contest the adjustment, within 30 days 
     after the date of the notice of the adjustment, by making a 
     request for review and, if appropriate, adjustment of the 
     order in accordance with the child support guidelines 
     established pursuant to section 467(a); or
       ``(iii) by using automated methods (including automated 
     comparisons with wage or State income tax data) to identify 
     orders eligible for review, conduct the review, identify 
     orders eligible for adjustment, and apply the appropriate 
     adjustment to the orders eligible for adjustment under the 
     threshold established by the State.
       ``(C) No proof of change in circumstances necessary.--Such 
     procedures shall provide that any adjustment under this 
     paragraph shall be made without a requirement for proof or 
     showing of a change in circumstances.
       ``(D) Notice of right to review.--Such procedures shall 
     require the State to provide notice not less than once every 
     3 years to the parents subject to an order being enforced 
     under this part informing them of their right to request the 
     State to review and, if appropriate, adjust the order 
     pursuant to this paragraph. The notice may be included in the 
     order.''.

     SEC. 4352. FURNISHING CONSUMER REPORTS FOR CERTAIN PURPOSES 
                   RELATING TO CHILD SUPPORT.

       Section 604 of the Fair Credit Reporting Act (15 U.S.C. 
     1681b) is amended by adding at the end the following new 
     paragraphs:
       ``(4) In response to a request by the head of a State or 
     local child support enforcement agency (or a State or local 
     government official authorized by the head of such an 
     agency), if the person making the request certifies to the 
     consumer reporting agency that--
       ``(A) the consumer report is needed for the purpose of 
     establishing an individual's capacity to make child support 
     payments or determining the appropriate level of such 
     payments;
       ``(B) the paternity of the consumer for the child to which 
     the obligation relates has been established or acknowledged 
     by the consumer in accordance with State laws under which the 
     obligation arises (if required by those laws);
       ``(C) the person has provided at least 10 days' prior 
     notice to the consumer whose report is requested, by 
     certified or registered mail to the last known address of the 
     consumer, that the report will be requested; and
       ``(D) the consumer report will be kept confidential, will 
     be used solely for a purpose described in subparagraph (A), 
     and will not be used in connection with any other civil, 
     administrative, or criminal proceeding, or for any other 
     purpose.
       ``(5) To an agency administering a State plan under section 
     454 of the Social Security Act (42 U.S.C. 654) for use to set 
     an initial or modified child support award.''.

     SEC. 4353. NONLIABILITY FOR FINANCIAL INSTITUTIONS PROVIDING 
                   FINANCIAL RECORDS TO STATE CHILD SUPPORT 
                   ENFORCEMENT AGENCIES IN CHILD SUPPORT CASES.

       Part D of title IV (42 U.S.C. 651-669) is amended by adding 
     at the end the following:

     ``SEC. 469A. NONLIABILITY FOR FINANCIAL INSTITUTIONS 
                   PROVIDING FINANCIAL RECORDS TO STATE CHILD 
                   SUPPORT ENFORCEMENT AGENCIES IN CHILD SUPPORT 
                   CASES.

       ``(a) In General.--Notwithstanding any other provision of 
     Federal or State law, a financial institution shall not be 
     liable under any Federal or State law to any person for 
     disclosing any financial record of an individual to a State 
     child support enforcement agency attempting to establish, 
     modify, or enforce a child support obligation of such 
     individual.
       ``(b) Prohibition of Disclosure of Financial Record 
     Obtained by State Child Support Enforcement Agency.--A State 
     child support enforcement agency which obtains a financial 
     record of an individual from a financial institution pursuant 
     to subsection (a) may disclose such financial record only for 
     the purpose of, and to the extent necessary in, establishing, 
     modifying, or enforcing a child support obligation of such 
     individual.
       ``(c) Civil Damages for Unauthorized Disclosure.--
       ``(1) Disclosure by state officer or employee.--If any 
     person knowingly, or by reason of negligence, discloses a 
     financial record of an individual in violation of subsection 
     (b), such individual may bring a civil

[[Page H7880]]

     action for damages against such person in a district court of 
     the United States.
       ``(2) No liability for good faith but erroneous 
     interpretation.--No liability shall arise under this 
     subsection with respect to any disclosure which results from 
     a good faith, but erroneous, interpretation of subsection 
     (b).
       ``(3) Damages.--In any action brought under paragraph (1), 
     upon a finding of liability on the part of the defendant, the 
     defendant shall be liable to the plaintiff in an amount equal 
     to the sum of--
       ``(A) the greater of--
       ``(i) $1,000 for each act of unauthorized disclosure of a 
     financial record with respect to which such defendant is 
     found liable; or
       ``(ii) the sum of--

       ``(I) the actual damages sustained by the plaintiff as a 
     result of such unauthorized disclosure; plus

       ``(II) in the case of a willful disclosure or a disclosure 
     which is the result of gross negligence, punitive damages; 
     plus

       ``(B) the costs (including attorney's fees) of the action.
       ``(d) Definitions.--For purposes of this section--
       ``(1) Financial institution.--The term `financial 
     institution' means--
       ``(A) a depository institution, as defined in section 3(c) 
     of the Federal Deposit Insurance Act (12 U.S.C. 1813(c));
       ``(B) an institution-affiliated party, as defined in 
     section 3(u) of such Act (12 U.S.C. 1813(u));
       ``(C) any Federal credit union or State credit union, as 
     defined in section 101 of the Federal Credit Union Act (12 
     U.S.C. 1752), including an institution-affiliated party of 
     such a credit union, as defined in section 206(r) of such Act 
     (12 U.S.C. 1786(r)); and
       ``(D) any benefit association, insurance company, safe 
     deposit company, money-market mutual fund, or similar entity 
     authorized to do business in the State.
       ``(2) Financial record.--The term `financial record' has 
     the meaning given such term in section 1101 of the Right to 
     Financial Privacy Act of 1978 (12 U.S.C. 3401).''.

                CHAPTER 7--ENFORCEMENT OF SUPPORT ORDERS

     SEC. 4361. INTERNAL REVENUE SERVICE COLLECTION OF ARREARAGES.

       (a) Collection of Fees.--Section 6305(a) of the Internal 
     Revenue Code of 1986 (relating to collection of certain 
     liability) is amended--
       (1) by striking ``and'' at the end of paragraph (3);
       (2) by striking the period at the end of paragraph (4) and 
     inserting ``, and'';
       (3) by adding at the end the following new paragraph:
       ``(5) no additional fee may be assessed for adjustments to 
     an amount previously certified pursuant to such section 
     452(b) with respect to the same obligor.''; and
       (4) by striking ``Secretary of Health, Education, and 
     Welfare'' each place it appears and inserting ``Secretary of 
     Health and Human Services''.
       (b) Effective Date.--The amendments made by this section 
     shall become effective October 1, 1997.

     SEC. 4362. AUTHORITY TO COLLECT SUPPORT FROM FEDERAL 
                   EMPLOYEES.

       (a) Consolidation and Streamlining of Authorities.--Section 
     459 (42 U.S.C. 659) is amended to read as follows:

     ``SEC. 459. CONSENT BY THE UNITED STATES TO INCOME 
                   WITHHOLDING, GARNISHMENT, AND SIMILAR 
                   PROCEEDINGS FOR ENFORCEMENT OF CHILD SUPPORT 
                   AND ALIMONY OBLIGATIONS.

       ``(a) Consent to Support Enforcement.--Notwithstanding any 
     other provision of law (including section 207 of this Act and 
     section 5301 of title 38, United States Code), effective 
     January 1, 1975, moneys (the entitlement to which is based 
     upon remuneration for employment) due from, or payable by, 
     the United States or the District of Columbia (including any 
     agency, subdivision, or instrumentality thereof) to any 
     individual, including members of the Armed Forces of the 
     United States, shall be subject, in like manner and to the 
     same extent as if the United States or the District of 
     Columbia were a private person, to withholding in accordance 
     with State law enacted pursuant to subsections (a)(1) and (b) 
     of section 466 and regulations of the Secretary under such 
     subsections, and to any other legal process brought, by a 
     State agency administering a program under a State plan 
     approved under this part or by an individual obligee, to 
     enforce the legal obligation of the individual to provide 
     child support or alimony.
       ``(b) Consent to Requirements Applicable to Private 
     Person.--With respect to notice to withhold income pursuant 
     to subsection (a)(1) or (b) of section 466, or any 
     other order or process to enforce support obligations 
     against an individual (if the order or process contains or 
     is accompanied by sufficient data to permit prompt 
     identification of the individual and the moneys involved), 
     each governmental entity specified in subsection (a) shall 
     be subject to the same requirements as would apply if the 
     entity were a private person, except as otherwise provided 
     in this section.
       ``(c) Designation of Agent; Response to Notice or Process--
       ``(1) Designation of agent.--The head of each agency 
     subject to this section shall--
       ``(A) designate an agent or agents to receive orders and 
     accept service of process in matters relating to child 
     support or alimony; and
       ``(B) annually publish in the Federal Register the 
     designation of the agent or agents, identified by title or 
     position, mailing address, and telephone number.
       ``(2) Response to notice or process.--If an agent 
     designated pursuant to paragraph (1) of this subsection 
     receives notice pursuant to State procedures in effect 
     pursuant to subsection (a)(1) or (b) of section 466, or is 
     effectively served with any order, process, or interrogatory, 
     with respect to an individual's child support or alimony 
     payment obligations, the agent shall--
       ``(A) as soon as possible (but not later than 15 days) 
     thereafter, send written notice of the notice or service 
     (together with a copy of the notice or service) to the 
     individual at the duty station or last-known home address of 
     the individual;
       ``(B) within 30 days (or such longer period as may be 
     prescribed by applicable State law) after receipt of a notice 
     pursuant to such State procedures, comply with all applicable 
     provisions of section 466; and
       ``(C) within 30 days (or such longer period as may be 
     prescribed by applicable State law) after effective service 
     of any other such order, process, or interrogatory, respond 
     to the order, process, or interrogatory.
       ``(d) Priority of Claims.--If a governmental entity 
     specified in subsection (a) receives notice or is served with 
     process, as provided in this section, concerning amounts owed 
     by an individual to more than 1 person--
       ``(1) support collection under section 466(b) must be given 
     priority over any other process, as provided in section 
     466(b)(7);
       ``(2) allocation of moneys due or payable to an individual 
     among claimants under section 466(b) shall be governed by 
     section 466(b) and the regulations prescribed under such 
     section; and
       ``(3) such moneys as remain after compliance with 
     paragraphs (1) and (2) shall be available to satisfy any 
     other such processes on a first-come, first-served basis, 
     with any such process being satisfied out of such moneys as 
     remain after the satisfaction of all such processes which 
     have been previously served.
       ``(e) No Requirement to Vary Pay Cycles.--A governmental 
     entity that is affected by legal process served for the 
     enforcement of an individual's child support or alimony 
     payment obligations shall not be required to vary its normal 
     pay and disbursement cycle in order to comply with the legal 
     process.
       ``(f) Relief From Liability.--
       ``(1) Neither the United States, nor the government of the 
     District of Columbia, nor any disbursing officer shall be 
     liable with respect to any payment made from moneys due or 
     payable from the United States to any individual pursuant to 
     legal process regular on its face, if the payment is made in 
     accordance with this section and the regulations issued to 
     carry out this section.
       ``(2) No Federal employee whose duties include taking 
     actions necessary to comply with the requirements of 
     subsection (a) with regard to any individual shall be subject 
     under any law to any disciplinary action or civil or criminal 
     liability or penalty for, or on account of, any disclosure 
     of information made by the employee in connection with the 
     carrying out of such actions.
       ``(g) Regulations.--Authority to promulgate regulations for 
     the implementation of this section shall, insofar as this 
     section applies to moneys due from (or payable by)--
       ``(1) the United States (other than the legislative or 
     judicial branches of the Federal Government) or the 
     government of the District of Columbia, be vested in the 
     President (or the designee of the President);
       ``(2) the legislative branch of the Federal Government, be 
     vested jointly in the President pro tempore of the Senate and 
     the Speaker of the House of Representatives (or their 
     designees), and
       ``(3) the judicial branch of the Federal Government, be 
     vested in the Chief Justice of the United States (or the 
     designee of the Chief Justice).
       ``(h) Moneys Subject to Process.--
       ``(1) In general.--Subject to paragraph (2), moneys paid or 
     payable to an individual which are considered to be based 
     upon remuneration for employment, for purposes of this 
     section--
       ``(A) consist of--
       ``(i) compensation paid or payable for personal services of 
     the individual, whether the compensation is denominated as 
     wages, salary, commission, bonus, pay, allowances, or 
     otherwise (including severance pay, sick pay, and incentive 
     pay);
       ``(ii) periodic benefits (including a periodic benefit as 
     defined in section 228(h)(3)) or other payments--

       ``(I) under the insurance system established by title II;
       ``(II) under any other system or fund established by the 
     United States which provides for the payment of pensions, 
     retirement or retired pay, annuities, dependents' or 
     survivors' benefits, or similar amounts payable on account of 
     personal services performed by the individual or any other 
     individual;
       ``(III) as compensation for death under any Federal 
     program;
       ``(IV) under any Federal program established to provide 
     `black lung' benefits; or
       ``(V) by the Secretary of Veterans Affairs as compensation 
     for a service-connected disability paid by the Secretary to a 
     former member of the Armed Forces who is in receipt of 
     retired or retainer pay if the former member has waived a 
     portion of the retired or retainer pay in order to receive 
     such compensation; and

[[Page H7881]]

       ``(iii) worker's compensation benefits paid under Federal 
     or State law but
       ``(B) do not include any payment--
       ``(i) by way of reimbursement or otherwise, to defray 
     expenses incurred by the individual in carrying out duties 
     associated with the employment of the individual; or
       ``(ii) as allowances for members of the uniformed services 
     payable pursuant to chapter 7 of title 37, United States 
     Code, as prescribed by the Secretaries concerned (defined by 
     section 101(5) of such title) as necessary for the efficient 
     performance of duty.
       ``(2) Certain amounts excluded.--In determining the amount 
     of any moneys due from, or payable by, the United States to 
     any individual, there shall be excluded amounts which--
       ``(A) are owed by the individual to the United States;
       ``(B) are required by law to be, and are, deducted from the 
     remuneration or other payment involved, including Federal 
     employment taxes, and fines and forfeitures ordered by court-
     martial;
       ``(C) are properly withheld for Federal, State, or local 
     income tax purposes, if the withholding of the amounts is 
     authorized or required by law and if amounts withheld are not 
     greater than would be the case if the individual claimed all 
     dependents to which he was entitled (the withholding of 
     additional amounts pursuant to section 3402(i) of the 
     Internal Revenue Code of 1986 may be permitted only when the 
     individual presents evidence of a tax obligation which 
     supports the additional withholding);
       ``(D) are deducted as health insurance premiums;
       ``(E) are deducted as normal retirement contributions (not 
     including amounts deducted for supplementary coverage); or
       ``(F) are deducted as normal life insurance premiums from 
     salary or other remuneration for employment (not including 
     amounts deducted for supplementary coverage).
       ``(i) Definitions.--For purposes of this section--
       ``(1) United states.--The term `United States' includes any 
     department, agency, or instrumentality of the legislative, 
     judicial, or executive branch of the Federal Government, the 
     United States Postal Service, the Postal Rate Commission, any 
     Federal corporation created by an Act of Congress that is 
     wholly owned by the Federal Government, and the governments 
     of the territories and possessions of the United States.
       ``(2) Child support.--The term `child support', when used 
     in reference to the legal obligations of an individual to 
     provide such support, means amounts required to be paid under 
     a judgment, decree, or order, whether temporary, final, or 
     subject to modification, issued by a court or an 
     administrative agency of competent jurisdiction, for the 
     support and maintenance of a child, including a child who has 
     attained the age of majority under the law of the issuing 
     State, or a child and the parent with whom the child is 
     living, which provides for monetary support, health care, 
     arrearages or reimbursement, and which may include other 
     related costs and fees, interest and penalties, income 
     withholding, attorney's fees, and other relief.
       ``(3) Alimony.--
       ``(A) In general.--The term `alimony', when used in 
     reference to the legal obligations of an individual to 
     provide the same, means periodic payments of funds for the 
     support and maintenance of the spouse (or former spouse) of 
     the individual, and (subject to and in accordance with State 
     law) includes separate maintenance, alimony pendente lite, 
     maintenance, and spousal support, and includes attorney's 
     fees, interest, and court costs when and to the extent that 
     the same are expressly made recoverable as such pursuant to a 
     decree, order, or judgment issued in accordance with 
     applicable State law by a court of competent jurisdiction.
       ``(B) Exceptions.--Such term does not include--
       ``(i) any child support; or
       ``(ii) any payment or transfer of property or its value by 
     an individual to the spouse or a former spouse of the 
     individual in compliance with any community property 
     settlement, equitable distribution of property, or other 
     division of property between spouses or former spouses.
       ``(4) Private person.--The term `private person' means a 
     person who does not have sovereign or other special immunity 
     or privilege which causes the person not to be subject to 
     legal process.
       ``(5) Legal process.--The term `legal process' means any 
     writ, order, summons, or other similar process in the nature 
     of garnishment--
       ``(A) which is issued by--
       ``(i) a court or an administrative agency of competent 
     jurisdiction in any State, territory, or possession of the 
     United States;
       ``(ii) a court or an administrative agency of competent 
     jurisdiction in any foreign country with which the United 
     States has entered into an agreement which requires the 
     United States to honor the process; or
       ``(iii) an authorized official pursuant to an order of such 
     a court or an administrative agency of competent jurisdiction 
     or pursuant to State or local law; and
       ``(B) which is directed to, and the purpose of which is to 
     compel, a governmental entity which holds moneys which are 
     otherwise payable to an individual to make a payment from the 
     moneys to another party in order to satisfy a legal 
     obligation of the individual to provide child support or make 
     alimony payments.''.
       (b) Conforming Amendments.--
       (1) To part d of title iv.--Sections 461 and 462 (42 U.S.C. 
     661 and 662) are repealed.
       (2) To title 5, united states code.--Section 5520a of title 
     5, United States Code, is amended, in subsections (h)(2) and 
     (i), by striking ``sections 459, 461, and 462 of the Social 
     Security Act (42 U.S.C. 659, 661, and 662)'' and inserting 
     ``section 459 of the Social Security Act (42 U.S.C. 659)''.
       (c) Military Retired and Retainer Pay.--
       (1) Definition of court.--Section 1408(a)(1) of title 10, 
     United States Code, is amended--
       (A) by striking ``and'' at the end of subparagraph (B);
       (B) by striking the period at the end of subparagraph (C) 
     and inserting ``; and''; and
       (C) by adding after subparagraph (C) the following new 
     subparagraph:
       ``(D) any administrative or judicial tribunal of a State 
     competent to enter orders for support or maintenance 
     (including a State agency administering a program under a 
     State plan approved under part D of title IV of the Social 
     Security Act), and, for purposes of this subparagraph, the 
     term `State' includes the District of Columbia, the 
     Commonwealth of Puerto Rico, the Virgin Islands, Guam, and 
     American Samoa.''.
       (2) Definition of court order.--Section 1408(a)(2) of such 
     title is amended--
       (A) by inserting ``or a support order, as defined in 
     section 453(p) of the Social Security Act (42 U.S.C. 
     653(p)),'' before ``which--'';
       (B) in subparagraph (B)(i), by striking ``(as defined in 
     section 462(b) of the Social Security Act (42 U.S.C. 
     662(b)))'' and inserting ``(as defined in section 459(i)(2) 
     of the Social Security Act (42 U.S.C. 659(i)(2)))''; and
       (C) in subparagraph (B)(ii), by striking ``(as defined in 
     section 462(c) of the Social Security Act (42 U.S.C. 
     662(c)))'' and inserting ``(as defined in section 459(i)(3) 
     of the Social Security Act (42 U.S.C. 659(i)(3)))''.
       (3) Public payee.--Section 1408(d) of such title is 
     amended--
       (A) in the heading, by inserting ``(or for Benefit of)'' 
     before ``Spouse or''; and
       (B) in paragraph (1), in the 1st sentence, by inserting 
     ``(or for the benefit of such spouse or former spouse to a 
     State disbursement unit established pursuant to section 454B 
     of the Social Security Act or other public payee designated 
     by a State, in accordance with part D of title IV of the 
     Social Security Act, as directed by court order, or as 
     otherwise directed in accordance with such part D)'' before 
     ``in an amount sufficient''.
       (4) Relationship to part d of title iv.--Section 1408 of 
     such title is amended by adding at the end the following new 
     subsection:
       ``(j) Relationship to Other Laws.--In any case involving an 
     order providing for payment of child support (as defined in 
     section 459(i)(2) of the Social Security Act) by a member who 
     has never been married to the other parent of the child, the 
     provisions of this section shall not apply, and the case 
     shall be subject to the provisions of section 459 of such 
     Act.''.
       (d) Effective Date.--The amendments made by this section 
     shall become effective 6 months after the date of the 
     enactment of this Act.

     SEC. 4363. ENFORCEMENT OF CHILD SUPPORT OBLIGATIONS OF 
                   MEMBERS OF THE ARMED FORCES.

       (a) Availability of Locator Information.--
       (1) Maintenance of address information.--The Secretary of 
     Defense shall establish a centralized personnel locator 
     service that includes the address of each member of the Armed 
     Forces under the jurisdiction of the Secretary. Upon request 
     of the Secretary of Transportation, addresses for members of 
     the Coast Guard shall be included in the centralized 
     personnel locator service.
       (2) Type of address.--
       (A) Residential address.--Except as provided in 
     subparagraph (B), the address for a member of the Armed 
     Forces shown in the locator service shall be the residential 
     address of that member.
       (B) Duty address.--The address for a member of the Armed 
     Forces shown in the locator service shall be the duty address 
     of that member in the case of a member--
       (i) who is permanently assigned overseas, to a vessel, or 
     to a routinely deployable unit; or
       (ii) with respect to whom the Secretary concerned makes a 
     determination that the member's residential address should 
     not be disclosed due to national security or safety concerns.
       (3) Updating of locator information.--Within 30 days after 
     a member listed in the locator service establishes a new 
     residential address (or a new duty address, in the case of a 
     member covered by paragraph (2)(B)), the Secretary concerned 
     shall update the locator service to indicate the new address 
     of the member.
       (4) Availability of information.--The Secretary of Defense 
     shall make information regarding the address of a member of 
     the Armed Forces listed in the locator service available, on 
     request, to the Federal Parent Locator Service established 
     under section 453 of the Social Security Act.
       (b) Facilitating Granting of Leave for Attendance at 
     Hearings.--
       (1) Regulations.--The Secretary of each military 
     department, and the Secretary of Transportation with respect 
     to the Coast Guard when it is not operating as a service in 
     the Navy, shall prescribe regulations to facilitate the 
     granting of leave to a member of the Armed Forces under the 
     jurisdiction of that Secretary in a case in which--

[[Page H7882]]

       (A) the leave is needed for the member to attend a hearing 
     described in paragraph (2);
       (B) the member is not serving in or with a unit deployed in 
     a contingency operation (as defined in section 101 of title 
     10, United States Code); and
       (C) the exigencies of military service (as determined by 
     the Secretary concerned) do not otherwise require that such 
     leave not be granted.
       (2) Covered hearings.--Paragraph (1) applies to a hearing 
     that is conducted by a court or pursuant to an administrative 
     process established under State law, in connection with a 
     civil action--
       (A) to determine whether a member of the Armed Forces is a 
     natural parent of a child; or
       (B) to determine an obligation of a member of the Armed 
     Forces to provide child support.
       (3) Definitions.--For purposes of this subsection--
       (A) The term ``court'' has the meaning given that term in 
     section 1408(a) of title 10, United States Code.
       (B) The term ``child support'' has the meaning given such 
     term in section 459(i) of the Social Security Act (42 U.S.C. 
     659(i)).
       (c) Payment of Military Retired Pay in Compliance With 
     Child Support Orders.--
       (1) Date of certification of court order.--Section 1408 of 
     title 10, United States Code, as amended by section 
     4362(c)(4) of this Act, is amended--
       (A) by redesignating subsections (i) and (j) as subsections 
     (j) and (k), respectively; and
       (B) by inserting after subsection (h) the following new 
     subsection:
       ``(i) Certification Date.--It is not necessary that the 
     date of a certification of the authenticity or completeness 
     of a copy of a court order for child support received by the 
     Secretary concerned for the purposes of this section be 
     recent in relation to the date of receipt by the 
     Secretary.''.
       (2) Payments consistent with assignments of rights to 
     states.--Section 1408(d)(1) of such title is amended by 
     inserting after the 1st sentence the following new sentence: 
     ``In the case of a spouse or former spouse who, pursuant to 
     section 408(a)(4) of the Social Security Act (42 U.S.C. 
     608(a)(4)), assigns to a State the rights of the spouse or 
     former spouse to receive support, the Secretary concerned may 
     make the child support payments referred to in the preceding 
     sentence to that State in amounts consistent with that 
     assignment of rights.''.
       (3) Arrearages owed by members of the uniformed services.--
     Section 1408(d) of such title is amended by adding at the end 
     the following new paragraph:
       ``(6) In the case of a court order for which effective 
     service is made on the Secretary concerned on or after the 
     date of the enactment of this paragraph and which provides 
     for payments from the disposable retired pay of a member to 
     satisfy the amount of child support set forth in the order, 
     the authority provided in paragraph (1) to make payments from 
     the disposable retired pay of a member to satisfy the amount 
     of child support set forth in a court order shall apply to 
     payment of any amount of child support arrearages set forth 
     in that order as well as to amounts of child support that 
     currently become due.''.
       (4) Payroll deductions.--The Secretary of Defense shall 
     begin payroll deductions within 30 days after receiving 
     notice of withholding, or for the 1st pay period that begins 
     after such 30-day period.

     SEC. 4364. VOIDING OF FRAUDULENT TRANSFERS.

       Section 466 (42 U.S.C. 666), as amended by section 4321 of 
     this Act, is amended by adding at the end the following new 
     subsection:
       ``(g) Laws Voiding Fraudulent Transfers.--In order to 
     satisfy section 454(20)(A), each State must have in effect--
       ``(1)(A) the Uniform Fraudulent Conveyance Act of 1981;
       ``(B) the Uniform Fraudulent Transfer Act of 1984; or
       ``(C) another law, specifying indicia of fraud which create 
     a prima facie case that a debtor transferred income or 
     property to avoid payment to a child support creditor, which 
     the Secretary finds affords comparable rights to child 
     support creditors; and
       ``(2) procedures under which, in any case in which the 
     State knows of a transfer by a child support debtor with 
     respect to which such a prima facie case is established, the 
     State must--
       ``(A) seek to void such transfer; or
       ``(B) obtain a settlement in the best interests of the 
     child support creditor.''.

     SEC. 4365. WORK REQUIREMENT FOR PERSONS OWING PAST-DUE CHILD 
                   SUPPORT.

       (a) In General.--Section 466(a) (42 U.S.C. 666(a)), as 
     amended by sections 4315, 4317(a), and 4323 of this Act, is 
     amended by inserting after paragraph (14) the following new 
     paragraph:
       ``(15) Procedures to ensure that persons owing past-due 
     support work or have a plan for payment of such support.--
       ``(A) In general.--Procedures under which the State has the 
     authority, in any case in which an individual owes past-due 
     support with respect to a child receiving assistance under a 
     State program funded under part A, to issue an order or to 
     request that a court or an administrative process established 
     pursuant to State law issue an order that requires the 
     individual to--
       ``(i) pay such support in accordance with a plan approved 
     by the court, or, at the option of the State, a plan approved 
     by the State agency administering the State program under 
     this part; or
       ``(ii) if the individual is subject to such a plan and is 
     not incapacitated, participate in such work activities (as 
     defined in section 407(d)) as the court, or, at the option of 
     the State, the State agency administering the State program 
     under this part, deems appropriate.
       ``(B) Past-due support defined.--For purposes of 
     subparagraph (A), the term `past-due support' means the 
     amount of a delinquency, determined under a court order, or 
     an order of an administrative process established under State 
     law, for support and maintenance of a child, or of a child 
     and the parent with whom the child is living.''.
       (b) Conforming amendment.--The flush paragraph at the end 
     of section 466(a) (42 U.S.C.666(a)) is amended by striking 
     ``and (7)'' and inserting ``(7), and (15)''.

     SEC. 4366. DEFINITION OF SUPPORT ORDER.

       Section 453 (42 U.S.C. 653) as amended by sections 4316 and 
     4345(b) of this Act, is amended by adding at the end the 
     following new subsection:
       ``(p) Support Order Defined.--As used in this part, the 
     term `support order' means a judgment, decree, or order, 
     whether temporary, final, or subject to modification, issued 
     by a court or an administrative agency of competent 
     jurisdiction, for the support and maintenance of a child, 
     including a child who has attained the age of majority under 
     the law of the issuing State, or a child and the parent with 
     whom the child is living, which provides for monetary 
     support, health care, arrearages, or reimbursement, and which 
     may include related costs and fees, interest and penalties, 
     income withholding, attorneys' fees, and other relief.''.

     SEC. 4367. REPORTING ARREARAGES TO CREDIT BUREAUS.

       Section 466(a)(7) (42 U.S.C. 666(a)(7)) is amended to read 
     as follows:
       ``(7) Reporting arrearages to credit bureaus.--
       ``(A) In general.--Procedures (subject to safeguards 
     pursuant to subparagraph (B)) requiring the State to report 
     periodically to consumer reporting agencies (as defined in 
     section 603(f) of the Fair Credit Reporting Act (15 U.S.C. 
     1681a(f)) the name of any noncustodial parent who is 
     delinquent in the payment of support, and the amount of 
     overdue support owed by such parent.
       ``(B) Safeguards.--Procedures ensuring that, in carrying 
     out subparagraph (A), information with respect to a 
     noncustodial parent is reported--
       ``(i) only after such parent has been afforded all due 
     process required under State law, including notice and a 
     reasonable opportunity to contest the accuracy of such 
     information; and
       ``(ii) only to an entity that has furnished evidence 
     satisfactory to the State that the entity is a consumer 
     reporting agency (as so defined).''.

     SEC. 4368. LIENS.

       Section 466(a)(4) (42 U.S.C. 666(a)(4)) is amended to read 
     as follows:
       ``(4) Liens.--Procedures under which--
       ``(A) liens arise by operation of law against real and 
     personal property for amounts of overdue support owed by a 
     noncustodial parent who resides or owns property in the 
     State; and
       ``(B) the State accords full faith and credit to liens 
     described in subparagraph (A) arising in another State, when 
     the State agency, party, or other entity seeking to enforce 
     such a lien complies with the procedural rules relating to 
     recording or serving liens that arise within the State, 
     except that such rules may not require judicial notice or 
     hearing prior to the enforcement of such a lien.''.

     SEC. 4369. STATE LAW AUTHORIZING SUSPENSION OF LICENSES.

       Section 466(a) (42 U.S.C. 666(a)), as amended by sections 
     4315, 4317(a), 4323, and 4365 of this Act, is amended by 
     inserting after paragraph (15) the following:
       ``(16) Authority to withhold or suspend licenses.--
     Procedures under which the State has (and uses in appropriate 
     cases) authority to withhold or suspend, or to restrict the 
     use of driver's licenses, professional and occupational 
     licenses, and recreational licenses of individuals owing 
     overdue support or failing, after receiving appropriate 
     notice, to comply with subpoenas or warrants relating to 
     paternity or child support proceedings.''.

     SEC. 4370. DENIAL OF PASSPORTS FOR NONPAYMENT OF CHILD 
                   SUPPORT.

       (a) HHS Certification Procedure.--
       (1) Secretarial responsibility.--Section 452 (42 U.S.C. 
     652), as amended by section 4345 of this Act, is amended by 
     adding at the end the following new subsection:
       ``(k)(1) If the Secretary receives a certification by a 
     State agency in accordance with the requirements of section 
     454(31) that an individual owes arrearages of child support 
     in an amount exceeding $5,000, the Secretary shall transmit 
     such certification to the Secretary of State for action (with 
     respect to denial, revocation, or limitation of passports) 
     pursuant to paragraph (2).
       ``(2) The Secretary of State shall, upon certification by 
     the Secretary transmitted under paragraph (1), refuse to 
     issue a passport to such individual, and may revoke, 
     restrict, or limit a passport issued previously to such 
     individual.
       ``(3) The Secretary and the Secretary of State shall not be 
     liable to an individual for any action with respect to a 
     certification by a State agency under this section.''.
       (2) State agency responsibility.--Section 454 (42 U.S.C. 
     654), as amended by sections 4301(b), 4303(a), 4312(b), 
     4313(a), 4333, 4343(b), and 4347 of this Act, is amended--

[[Page H7883]]

       (A) by striking ``and'' at the end of paragraph (30);
       (B) by striking the period at the end of paragraph (31) and 
     inserting ``; and''; and
       (C) by adding after paragraph (31) the following new 
     paragraph:
       ``(32) provide that the State agency will have in effect a 
     procedure for certifying to the Secretary, for purposes of 
     the procedure under section 452(k), determinations that 
     individuals owe arrearages of child support in an amount 
     exceeding $5,000, under which procedure--
       ``(A) each individual concerned is afforded notice of such 
     determination and the consequences thereof, and an 
     opportunity to contest the determination; and
       ``(B) the certification by the State agency is furnished to 
     the Secretary in such format, and accompanied by such 
     supporting documentation, as the Secretary may require.''.
       (b) Effective Date.--This section and the amendments made 
     by this section shall become effective October 1, 1997.

     SEC. 4371. INTERNATIONAL SUPPORT ENFORCEMENT.

       (a) Authority for International Agreements.--Part D of 
     title IV, as amended by section 4362(a) of this Act, is 
     amended by adding after section 459 the following new 
     section:

     ``SEC. 459A. INTERNATIONAL SUPPORT ENFORCEMENT.

       ``(a) Authority for Declarations.--
       ``(1) Declaration.--The Secretary of State, with the 
     concurrence of the Secretary of Health and Human Services, is 
     authorized to declare any foreign country (or a political 
     subdivision thereof) to be a foreign reciprocating country if 
     the foreign country has established, or undertakes to 
     establish, procedures for the establishment and enforcement 
     of duties of support owed to obligees who are residents of 
     the United States, and such procedures are substantially in 
     conformity with the standards prescribed under subsection 
     (b).
       ``(2) Revocation.--A declaration with respect to a foreign 
     country made pursuant to paragraph (1) may be revoked if the 
     Secretaries of State and Health and Human Services determine 
     that--
       ``(A) the procedures established by the foreign country 
     regarding the establishment and enforcement of duties of 
     support have been so changed, or the foreign country's 
     implementation of such procedures is so unsatisfactory, that 
     such procedures do not meet the criteria for such a 
     declaration; or
       ``(B) continued operation of the declaration is not 
     consistent with the purposes of this part.
       ``(3) Form of declaration.--A declaration under paragraph 
     (1) may be made in the form of an international agreement, in 
     connection with an international agreement or corresponding 
     foreign declaration, or on a unilateral basis.
       ``(b) Standards for Foreign Support Enforcement 
     Procedures.--
       ``(1) Mandatory elements.--Support enforcement procedures 
     of a foreign country which may be the subject of a 
     declaration pursuant to subsection (a)(1) shall include the 
     following elements:
       ``(A) The foreign country (or political subdivision 
     thereof) has in effect procedures, available to residents of 
     the United States--
       ``(i) for establishment of paternity, and for establishment 
     of orders of support for children and custodial parents; and
       ``(ii) for enforcement of orders to provide support to 
     children and custodial parents, including procedures for 
     collection and appropriate distribution of support payments 
     under such orders.
       ``(B) The procedures described in subparagraph (A), 
     including legal and administrative assistance, are provided 
     to residents of the United States at no cost.
       ``(C) An agency of the foreign country is designated as a 
     Central Authority responsible for--
       ``(i) facilitating support enforcement in cases involving 
     residents of the foreign country and residents of the United 
     States; and
       ``(ii) ensuring compliance with the standards established 
     pursuant to this subsection.
       ``(2) Additional elements.--The Secretary of Health and 
     Human Services and the Secretary of State, in consultation 
     with the States, may establish such additional standards as 
     may be considered necessary to further the purposes of this 
     section.
       ``(c) Designation of United States Central Authority.--It 
     shall be the responsibility of the Secretary of Health and 
     Human Services to facilitate support enforcement in cases 
     involving residents of the United States and residents of 
     foreign countries that are the subject of a declaration under 
     this section, by activities including--
       ``(1) development of uniform forms and procedures for use 
     in such cases;
       ``(2) notification of foreign reciprocating countries of 
     the State of residence of individuals sought for support 
     enforcement purposes, on the basis of information provided by 
     the Federal Parent Locator Service; and
       ``(3) such other oversight, assistance, and coordination 
     activities as the Secretary may find necessary and 
     appropriate.
       ``(d) Effect on Other Laws.--States may enter into 
     reciprocal arrangements for the establishment and enforcement 
     of support obligations with foreign countries that are not 
     the subject of a declaration pursuant to subsection (a), to 
     the extent consistent with Federal law.''.
       (b) State Plan Requirement.--Section 454 (42 U.S.C. 654), 
     as amended by sections 4301(b), 4303(a), 4312(b), 4313(a), 
     4333, 4343(b), 4347, and 4370(a)(2) of this Act, is amended--
       (1) by striking ``and'' at the end of paragraph (31);
       (2) by striking the period at the end of paragraph (32) and 
     inserting ``; and''; and
       (3) by adding after paragraph (32) the following new 
     paragraph:
       ``(33)(A) provide that any request for services under this 
     part by a foreign reciprocating country or a foreign country 
     with which the State has an arrangement described in section 
     459A(d)(2) shall be treated as a request by a State;
       ``(B) provide, at State option, notwithstanding paragraph 
     (4) or any other provision of this part, for services under 
     the plan for enforcement of a spousal support order not 
     described in paragraph (4)(B) entered by such a country (or 
     subdivision); and
       ``(C) provide that no applications will be required from, 
     and no costs will be assessed for such services against, the 
     foreign reciprocating country or foreign obligee (but costs 
     may at State option be assessed against the obligor).''.

     SEC. 4372. FINANCIAL INSTITUTION DATA MATCHES.

       Section 466(a) (42 U.S.C. 666(a)), as amended by sections 
     4315, 4317(a), 4323, 4365, and 4369 of this Act, is amended 
     by inserting after paragraph (16) the following new 
     paragraph:
       ``(17) Financial institution data matches.--
       ``(A) In general.--Procedures under which the State agency 
     shall enter into agreements with financial institutions doing 
     business in the State--
       ``(i) to develop and operate, in coordination with such 
     financial institutions, a data match system, using automated 
     data exchanges to the maximum extent feasible, in which each 
     such financial institution is required to provide for each 
     calendar quarter the name, record address, social security 
     number or other taxpayer identification number, and other 
     identifying information for each noncustodial parent who 
     maintains an account at such institution and who owes past-
     due support, as identified by the State by name and social 
     security number or other taxpayer identification number; and
       ``(ii) in response to a notice of lien or levy, encumber or 
     surrender, as the case may be, assets held by such 
     institution on behalf of any noncustodial parent who is 
     subject to a child support lien pursuant to paragraph (4).
       ``(B) Reasonable fees.--The State agency may pay a 
     reasonable fee to a financial institution for conducting the 
     data match provided for in subparagraph (A)(i), not to exceed 
     the actual costs incurred by such financial institution.
       ``(C) Liability.--A financial institution shall not be 
     liable under any Federal or State law to any person--
       ``(i) for any disclosure of information to the State agency 
     under subparagraph (A)(i);
       ``(ii) for encumbering or surrendering any assets held by 
     such financial institution in response to a notice of lien or 
     levy issued by the State agency as provided for in 
     subparagraph (A)(ii); or
       ``(iii) for any other action taken in good faith to comply 
     with the requirements of subparagraph (A).
       ``(D) Definitions.--For purposes of this paragraph--
       ``(i) Financial institution.--The term `financial 
     institution' has the meaning given to such term by section 
     469A(d)(1).
       ``(ii) Account.--The term `account' means a demand deposit 
     account, checking or negotiable withdrawal order account, 
     savings account, time deposit account, or money-market mutual 
     fund account.''.

     SEC. 4373. ENFORCEMENT OF ORDERS AGAINST PATERNAL OR MATERNAL 
                   GRANDPARENTS IN CASES OF MINOR PARENTS.

       Section 466(a) (42 U.S.C. 666(a)), as amended by sections 
     4315, 4317(a), 4323, 4365, 4369, and 4372 of this Act, is 
     amended by inserting after paragraph (17) the following new 
     paragraph:
       ``(18) Enforcement of orders against paternal or maternal 
     grandparents.--Procedures under which, at the State's option, 
     any child support order enforced under this part with respect 
     to a child of minor parents, if the custodial parent of such 
     child is receiving assistance under the State program under 
     part A, shall be enforceable, jointly and severally, against 
     the parents of the noncustodial parent of such child.''.

     SEC. 4374. NONDISCHARGEABILITY IN BANKRUPTCY OF CERTAIN DEBTS 
                   FOR THE SUPPORT OF A CHILD.

       (a) Amendment to Title 11 of the United States Code.--
     Section 523(a) of title 11, United States Code, is amended--
       (1) by striking ``or'' at the end of paragraph (16);
       (2) by striking the period at the end of paragraph (17) and 
     inserting ``; or'';
       (3) by adding at the end the following:
       ``(18) owed under State law to a State or municipality that 
     is--
       ``(A) in the nature of support, and
       ``(B) enforceable under part D of title IV of the Social 
     Security Act (42 U.S.C. 601 et seq.).''; and
       (4) in paragraph (5), by striking ``section 402(a)(26)'' 
     and inserting ``section 408(a)(4)''.
       (b) Amendment to the Social Security Act.--Section 456(b) 
     (42 U.S.C. 656(b)) is amended to read as follows:
       ``(b) Nondischargeability.--A debt (as defined in section 
     101 of title 11 of the United States Code) owed under State 
     law to a State (as defined in such section) or municipality 
     (as defined in such section) that is in the nature of support 
     and that is enforceable under

[[Page H7884]]

     this part is not released by a discharge in bankruptcy under 
     title 11 of the United States Code.''.
       (c) Application of Amendments.--The amendments made by this 
     section shall apply only with respect to cases commenced 
     under title 11 of the United States Code after the date of 
     the enactment of this Act.

                       CHAPTER 8--MEDICAL SUPPORT

     SEC. 4376. CORRECTION TO ERISA DEFINITION OF MEDICAL CHILD 
                   SUPPORT ORDER.

       (a) In General.--Section 609(a)(2)(B) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 
     1169(a)(2)(B)) is amended--
       (1) by striking ``issued by a court of competent 
     jurisdiction'';
       (2) by striking the period at the end of clause (ii) and 
     inserting a comma; and
       (3) by adding, after and below clause (ii), the following:

     ``if such judgment, decree, or order (I) is issued by a court 
     of competent jurisdiction or (II) is issued through an 
     administrative process established under State law and has 
     the force and effect of law under applicable State law.''.
       (b) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     take effect on the date of the enactment of this Act.
       (2) Plan amendments not required until january 1, 1997.--
     Any amendment to a plan required to be made by an amendment 
     made by this section shall not be required to be made before 
     the 1st plan year beginning on or after January 1, 1997, if--
       (A) during the period after the date before the date of the 
     enactment of this Act and before such 1st plan year, the plan 
     is operated in accordance with the requirements of the 
     amendments made by this section; and
       (B) such plan amendment applies retroactively to the period 
     after the date before the date of the enactment of this Act 
     and before such 1st plan year.

     A plan shall not be treated as failing to be operated in 
     accordance with the provisions of the plan merely because it 
     operates in accordance with this paragraph.

     SEC. 4377. ENFORCEMENT OF ORDERS FOR HEALTH CARE COVERAGE.

       Section 466(a) (42 U.S.C. 666(a)), as amended by sections 
     4315, 4317(a), 4323, 4365, 4369, 4372, and 4373 of this Act, 
     is amended by inserting after paragraph (18) the following 
     new paragraph:
       ``(19) Health care coverage.--Procedures under which all 
     child support orders enforced pursuant to this part shall 
     include a provision for the health care coverage of the 
     child, and in the case in which a noncustodial parent 
     provides such coverage and changes employment, and the new 
     employer provides health care coverage, the State agency 
     shall transfer notice of the provision to the employer, which 
     notice shall operate to enroll the child in the noncustodial 
     parent's health plan, unless the noncustodial parent contests 
     the notice.''.

CHAPTER 9--ENHANCING RESPONSIBILITY AND OPPORTUNITY FOR NON-RESIDENTIAL 
                                PARENTS

     SEC. 4381. GRANTS TO STATES FOR ACCESS AND VISITATION 
                   PROGRAMS.

       Part D of title IV (42 U.S.C. 651-669), as amended by 
     section 4353 of this Act, is amended by adding at the end the 
     following new section:

     ``SEC. 469B. GRANTS TO STATES FOR ACCESS AND VISITATION 
                   PROGRAMS.

       ``(a) In General.--The Administration for Children and 
     Families shall make grants under this section to enable 
     States to establish and administer programs to support and 
     facilitate noncustodial parents' access to and visitation of 
     their children, by means of activities including mediation 
     (both voluntary and mandatory), counseling, education, 
     development of parenting plans, visitation enforcement 
     (including monitoring, supervision and neutral drop-off and 
     pickup), and development of guidelines for visitation and 
     alternative custody arrangements.
       ``(b) Amount of Grant.--The amount of the grant to be made 
     to a State under this section for a fiscal year shall be an 
     amount equal to the lesser of--
       ``(1) 90 percent of State expenditures during the fiscal 
     year for activities described in subsection (a); or
       ``(2) the allotment of the State under subsection (c) for 
     the fiscal year.
       ``(c) Allotments to States.--
       ``(1) In general.--The allotment of a State for a fiscal 
     year is the amount that bears the same ratio to $10,000,000 
     for grants under this section for the fiscal year as the 
     number of children in the State living with only 1 biological 
     parent bears to the total number of such children in all 
     States.
       ``(2) Minimum allotment.--The Administration for Children 
     and Families shall adjust allotments to States under 
     paragraph (1) as necessary to ensure that no State is 
     allotted less than--
       ``(A) $50,000 for fiscal year 1997 or 1998; or
       ``(B) $100,000 for any succeeding fiscal year.
       ``(d) No Supplantation of State Expenditures for Similar 
     Activities.--A State to which a grant is made under this 
     section may not use the grant to supplant expenditures by the 
     State for activities specified in subsection (a), but shall 
     use the grant to supplement such expenditures at a level at 
     least equal to the level of such expenditures for fiscal year 
     1995.
       ``(e) State Administration.--Each State to which a grant is 
     made under this section--
       ``(1) may administer State programs funded with the grant, 
     directly or through grants to or contracts with courts, local 
     public agencies, or nonprofit private entities;
       ``(2) shall not be required to operate such programs on a 
     statewide basis; and
       ``(3) shall monitor, evaluate, and report on such programs 
     in accordance with regulations prescribed by the 
     Secretary.''.

         CHAPTER 10--EFFECTIVE DATES AND CONFORMING AMENDMENTS

     SEC. 4391. EFFECTIVE DATES AND CONFORMING AMENDMENTS.

       (a) In General.--Except as otherwise specifically provided 
     (but subject to subsections (b) and (c))--
       (1) the provisions of this subtitle requiring the enactment 
     or amendment of State laws under section 466 of the Social 
     Security Act, or revision of State plans under section 454 of 
     such Act, shall be effective with respect to periods 
     beginning on and after October 1, 1996; and
       (2) all other provisions of this subtitle shall become 
     effective upon the date of the enactment of this Act.
       (b) Grace Period for State Law Changes.--The provisions of 
     this subtitle shall become effective with respect to a State 
     on the later of--
       (1) the date specified in this subtitle, or
       (2) the effective date of laws enacted by the legislature 
     of such State implementing such provisions,

     but in no event later than the 1st day of the 1st calendar 
     quarter beginning after the close of the 1st regular session 
     of the State legislature that begins after the date of the 
     enactment of this Act. For purposes of the previous sentence, 
     in the case of a State that has a 2-year legislative session, 
     each year of such session shall be deemed to be a separate 
     regular session of the State legislature.
       (c) Grace Period for State Constitutional Amendment.--A 
     State shall not be found out of compliance with any 
     requirement enacted by this subtitle if the State is unable 
     to so comply without amending the State constitution until 
     the earlier of--
       (1) 1 year after the effective date of the necessary State 
     constitutional amendment; or
       (2) 5 years after the date of the enactment of this Act.
       (d) Conforming Amendments.--
       (1) The following provisions are amended by striking 
     ``absent'' each place it appears and inserting 
     ``noncustodial'':
       (A) Section 451 (42 U.S.C. 651).
       (B) Subsections (a)(1), (a)(8), (a)(10)(E), (a)(10)(F), 
     (f), and (h) of section 452 (42 U.S.C. 652).
       (C) Section 453(f) (42 U.S.C. 653(f)).
       (D) Paragraphs (8), (13), and (21)(A) of section 454 (42 
     U.S.C. 654).
       (E) Section 455(e)(1) (42 U.S.C. 655(e)(1)).
       (F) Section 458(a) (42 U.S.C. 658(a)).
       (G) Subsections (a), (b), and (c) of section 463 (42 U.S.C. 
     663).
       (H) Subsections (a)(3)(A), (a)(3)(C), (a)(6), and 
     (a)(8)(B)(ii), the last sentence of subsection (a), and 
     subsections (b)(1), (b)(3)(B), (b)(3)(B)(i), (b)(6)(A)(i), 
     (b)(9), and (e) of section 466 (42 U.S.C. 666).
       (2) The following provisions are amended by striking ``an 
     absent'' each place it appears and inserting ``a 
     noncustodial'':
       (A) Paragraphs (2) and (3) of section 453(c) (42 U.S.C. 
     653(c)).
       (B) Subparagraphs (B) and (C) of section 454(9) (42 U.S.C. 
     654(9)).
       (C) Section 456(a)(3) (42 U.S.C. 656(a)(3)).
       (D) Subsections (a)(3)(A), (a)(6), (a)(8)(B)(i), (b)(3)(A), 
     and (b)(3)(B) of section 466 (42 U.S.C. 666).
       (E) Paragraphs (2) and (4) of section 469(b) (42 U.S.C. 
     669(b)).
     Subtitle D--Restricting Welfare and Public Benefits for Aliens

     SEC. 4400. STATEMENTS OF NATIONAL POLICY CONCERNING WELFARE 
                   AND IMMIGRATION.

       The Congress makes the following statements concerning 
     national policy with respect to welfare and immigration:
       (1) Self-sufficiency has been a basic principle of United 
     States immigration law since this country's earliest 
     immigration statutes.
       (2) It continues to be the immigration policy of the United 
     States that--
       (A) aliens within the Nation's borders not depend on public 
     resources to meet their needs, but rather rely on their own 
     capabilities and the resources of their families, their 
     sponsors, and private organizations, and
       (B) the availability of public benefits not constitute an 
     incentive for immigration to the United States.
       (3) Despite the principle of self-sufficiency, aliens have 
     been applying for and receiving public benefits from Federal, 
     State, and local governments at increasing rates.
       (4) Current eligibility rules for public assistance and 
     unenforceable financial support agreements have proved wholly 
     incapable of assuring that individual aliens not burden the 
     public benefits system.
       (5) It is a compelling government interest to enact new 
     rules for eligibility and sponsorship agreements in order to 
     assure that aliens be self-reliant in accordance with 
     national immigration policy.
       (6) It is a compelling government interest to remove the 
     incentive for illegal immigration provided by the 
     availability of public benefits.
       (7) With respect to the State authority to make 
     determinations concerning the eligibility of qualified aliens 
     for public benefits in this subtitle, a State that chooses to 
     follow the Federal classification in determining the 
     eligibility of such aliens for public assistance shall be 
     considered to have chosen

[[Page H7885]]

     the least restrictive means available for achieving the 
     compelling governmental interest of assuring that aliens be 
     self-reliant in accordance with national immigration policy.

              CHAPTER 1--ELIGIBILITY FOR FEDERAL BENEFITS

     SEC. 4401. ALIENS WHO ARE NOT QUALIFIED ALIENS INELIGIBLE FOR 
                   FEDERAL PUBLIC BENEFITS.

       (a) In General.--Notwithstanding any other provision of law 
     and except as provided in subsection (b), an alien who is not 
     a qualified alien (as defined in section 4431) is not 
     eligible for any Federal public benefit (as defined in 
     subsection (c)).
       (b) Exceptions.--
       (1) Subsection (a) shall not apply with respect to the 
     following Federal public benefits:
       (A) Emergency medical services under title XIX of the 
     Social Security Act.
       (B) Short-term, non-cash, in-kind emergency disaster 
     relief.
       (C) Public health assistance for immunizations with respect 
     to immunizable diseases and for testing and treatment of 
     symptoms of communicable diseases whether or not such 
     symptoms are caused by a communicable disease.
       (D) Programs, services, or assistance (such as soup 
     kitchens, crisis counseling and intervention, and short-term 
     shelter) specified by the Attorney General, in the Attorney 
     General's sole and unreviewable discretion after consultation 
     with appropriate Federal agencies and departments, which (i) 
     deliver in-kind services at the community level, including 
     through public or private nonprofit agencies; (ii) do not 
     condition the provision of assistance, the amount of 
     assistance provided, or the cost of assistance provided on 
     the individual recipient's income or resources; and (iii) are 
     necessary for the protection of life or safety.
       (E) Programs for housing or community development 
     assistance or financial assistance administered by the 
     Secretary of Housing and Urban Development, any program under 
     title V of the Housing Act of 1949, or any assistance under 
     section 306C of the Consolidated Farm and Rural Development 
     Act, to the extent that the alien is receiving such a benefit 
     on the date of the enactment of this Act.
       (2) Subsection (a) shall not apply to any benefit payable 
     under title II of the Social Security Act to an alien who is 
     lawfully present in the United States as determined by the 
     Attorney General, to any benefit if nonpayment of such 
     benefit would contravene an international agreement described 
     in section 233 of the Social Security Act, to any benefit if 
     nonpayment would be contrary to section 202(t) of the Social 
     Security Act, or to any benefit payable under title II of the 
     Social Security Act to which entitlement is based on an 
     application filed in or before the month in which this Act 
     becomes law.
       (c) Federal Public Benefit Defined.--
       (1) Except as provided in paragraph (2), for purposes of 
     this subtitle the term ``Federal public benefit'' means--
       (A) any grant, contract, loan, professional license, or 
     commercial license provided by an agency of the United States 
     or by appropriated funds of the United States; and
       (B) any retirement, welfare, health, disability, public or 
     assisted housing, postsecondary education, food assistance, 
     unemployment benefit, or any other similar benefit for which 
     payments or assistance are provided to an individual, 
     household, or family eligibility unit by an agency of the 
     United States or by appropriated funds of the United States.
       (2) Such term shall not apply--
       (A) to any contract, professional license, or commercial 
     license for a nonimmigrant whose visa for entry is related to 
     such employment in the United States; or
       (B) with respect to benefits for an alien who as a work 
     authorized nonimmigrant or as an alien lawfully admitted for 
     permanent residence under the Immigration and Nationality Act 
     qualified for such benefits and for whom the United States 
     under reciprocal treaty agreements is required to pay 
     benefits, as determined by the Attorney General, after 
     consultation with the Secretary of State.

     SEC. 4402. LIMITED ELIGIBILITY OF QUALIFIED ALIENS FOR 
                   CERTAIN FEDERAL PROGRAMS.

       (a) Limited Eligibility for Specified Federal Programs.--
       (1) In general.--Notwithstanding any other provision of law 
     and except as provided in paragraph (2), an alien who is a 
     qualified alien (as defined in section 4431) is not eligible 
     for any specified Federal program (as defined in paragraph 
     (3)).
       (2) Exceptions.--
       (A) Time-limited exception for refugees and asylees.--
     Paragraph (1) shall not apply to an alien until 5 years after 
     the date--
       (i) an alien is admitted to the United States as a refugee 
     under section 207 of the Immigration and Nationality Act;
       (ii) an alien is granted asylum under section 208 of such 
     Act; or
       (iii) an alien's deportation is withheld under section 
     243(h) of such Act.
       (B) Certain permanent resident aliens.--Paragraph (1) shall 
     not apply to an alien who--
       (i) is lawfully admitted to the United States for permanent 
     residence under the Immigration and Nationality Act; and
       (ii)(I) has worked 40 qualifying quarters of coverage as 
     defined under title II of the Social Security Act or can be 
     credited with such qualifying quarters as provided under 
     section 435, and (II) did not receive any Federal means-
     tested public benefit (as defined in section 4403(c)) during 
     any such quarter.
       (C) Veteran and active duty exception.--Paragraph (1) shall 
     not apply to an alien who is lawfully residing in any State 
     and is--
       (i) a veteran (as defined in section 101 of title 38, 
     United States Code) with a discharge characterized as an 
     honorable discharge and not on account of alienage,
       (ii) on active duty (other than active duty for training) 
     in the Armed Forces of the United States, or
       (iii) the spouse or unmarried dependent child of an 
     individual described in clause (i) or (ii).
       (D) Transition for aliens currently receiving benefits.--
       (i) SSI.--

       (I) In general.--With respect to the specified Federal 
     program described in paragraph (3)(A), during the period 
     beginning on the date of the enactment of this Act and ending 
     on the date which is 1 year after such date of enactment, the 
     Commissioner of Social Security shall redetermine the 
     eligibility of any individual who is receiving benefits under 
     such program as of the date of the enactment of this Act and 
     whose eligibility for such benefits may terminate by reason 
     of the provisions of this subsection.
       (II) Redetermination criteria.-- With respect to any 
     redetermination under subclause (I), the Commissioner of 
     Social Security shall apply the eligibility criteria for new 
     applicants for benefits under such program.
       (III) Grandfather provision.--The provisions of this 
     subsection and the redetermination under subclause (I), shall 
     only apply with respect to the benefits of an individual 
     described in subclause (I) for months beginning on or after 
     the date of the redetermination with respect to such 
     individual.
       (IV) Notice.--Not later than January 1, 1997, the 
     Commissioner of Social Security shall notify an individual 
     described in subclause (I) of the provisions of this clause.

       (ii) Food stamps.--

       (I) In general.--With respect to the specified Federal 
     program described in paragraph (3)(B), during the period 
     beginning on the date of enactment of this Act and ending on 
     the date which is 1 year after the date of enactment, the 
     State agency shall, at the time of the recertification, 
     recertify the eligibility of any individual who is receiving 
     benefits under such program as of the date of enactment of 
     this Act and whose eligibility for such benefits may 
     terminate by reason of the provisions of this subsection.
       (II) Recertification criteria.--With respect to any 
     recertification under subclause (I), the State agency shall 
     apply the eligibility criteria for applicants for benefits 
     under such program.
       (III) Grandfather provision.--The provisions of this 
     subsection and the recertification under subclause (I) shall 
     only apply with respect to the eligibility of an alien for a 
     program for months beginning on or after the date of 
     recertification, if on the date of enactment of this Act the 
     alien is lawfully residing in any State and is receiving 
     benefits under such program on such date of enactment.

       (iii) Medicaid.--

       (I) In general.--With respect to the specified Federal 
     program described in paragraph (3)(C), during the period 
     beginning on the date of enactment of this Act and ending on 
     the date which is 1 year after the date of enactment, the 
     State agency shall, at the time of the redetermination, 
     redetermine the eligibility of any individual who is 
     receiving benefits under such program as of the date of 
     enactment of this Act and whose eligibility for such benefits 
     may terminate by reason of the provisions of this subsection.
       (II) Redetermination.--With respect to any redetermination 
     under subclause (I), the State agency shall apply the 
     eligibility criteria for applicants for benefits under such 
     program.
       (III) Grandfather provision.--The provisions of this 
     subsection and the redetermination under subclause (I) shall 
     only apply with respect to the eligibility of an alien for a 
     program for months beginning on or after the date of 
     redetermination, if on the date of enactment of this Act the 
     alien is lawfully residing in any State and is receiving 
     benefits under such program on such date of enactment.

       (3) Specified federal program defined.--For purposes of 
     this subtitle, the term ``specified Federal program'' means 
     any of the following:
       (A) SSI.--The supplemental security income program under 
     title XVI of the Social Security Act, including supplementary 
     payments pursuant to an agreement for Federal administration 
     under section 1616(a) of the Social Security Act and payments 
     pursuant to an agreement entered into under section 212(b) of 
     Public Law 93-66.
       (B) Food stamps.--The food stamp program as defined in 
     section 3(h) of the Food Stamp Act of 1977.
       (C) Medicaid.--A State plan approved under title XIX of the 
     Social Security Act.
       (b) Limited Eligibility for Designated Federal Programs.--
       (1) In general.--Notwithstanding any other provision of law 
     and except as provided in section 4403 and paragraph (2), a 
     State is authorized to determine the eligibility of an alien 
     who is a qualified alien (as defined in

[[Page H7886]]

     section 4431) for any designated Federal program (as defined 
     in paragraph (3)).
       (2) Exceptions.--Qualified aliens under this paragraph 
     shall be eligible for any designated Federal program.
       (A) Time-limited exception for refugees and asylees.--
       (i) An alien who is admitted to the United States as a 
     refugee under section 207 of the Immigration and Nationality 
     Act until 5 years after the date of an alien's entry into the 
     United States.
       (ii) An alien who is granted asylum under section 208 of 
     such Act until 5 years after the date of such grant of 
     asylum.
       (iii) An alien whose deportation is being withheld under 
     section 243(h) of such Act until 5 years after such 
     withholding.
       (B) Certain permanent resident aliens.--An alien who--
       (i) is lawfully admitted to the United States for permanent 
     residence under the Immigration and Nationality Act; and
       (ii)(I) has worked 40 qualifying quarters of coverage as 
     defined under title II of the Social Security Act or can be 
     credited with such qualifying quarters as provided under 
     section 4435, and (II) did not receive any Federal means-
     tested public benefit (as defined in section 4403(c)) during 
     any such quarter.
       (C) Veteran and active duty exception.--An alien who is 
     lawfully residing in any State and is--
       (i) a veteran (as defined in section 101 of title 38, 
     United States Code) with a discharge characterized as an 
     honorable discharge and not on account of alienage,
       (ii) on active duty (other than active duty for training) 
     in the Armed Forces of the United States, or
       (iii) the spouse or unmarried dependent child of an 
     individual described in clause (i) or (ii).
       (D) Transition for those currently receiving benefits.--An 
     alien who on the date of the enactment of this Act is 
     lawfully residing in any State and is receiving benefits 
     under such program on the date of the enactment of this Act 
     shall continue to be eligible to receive such benefits until 
     January 1, 1997.
       (3) Designated federal program defined.--For purposes of 
     this subtitle, the term ``designated Federal program'' means 
     any of the following:
       (A) Temporary assistance for needy families.--The program 
     of block grants to States for temporary assistance for needy 
     families under part A of title IV of the Social Security Act.
       (B) Social services block grant.--The program of block 
     grants to States for social services under title XX of the 
     Social Security Act.

     SEC. 4403. FIVE-YEAR LIMITED ELIGIBILITY OF QUALIFIED ALIENS 
                   FOR FEDERAL MEANS-TESTED PUBLIC BENEFIT.

       (a) In General.--Notwithstanding any other provision of law 
     and except as provided in subsection (b), an alien who is a 
     qualified alien (as defined in section 4431) and who enters 
     the United States on or after the date of the enactment of 
     this Act is not eligible for any Federal means-tested public 
     benefit (as defined in subsection (c)) for a period of five 
     years beginning on the date of the alien's entry into the 
     United States with a status within the meaning of the term 
     ``qualified alien''.
       (b) Exceptions.--The limitation under subsection (a) shall 
     not apply to the following aliens:
       (1) Exception for refugees and asylees.--
       (A) An alien who is admitted to the United States as a 
     refugee under section 207 of the Immigration and Nationality 
     Act.
       (B) An alien who is granted asylum under section 208 of 
     such Act.
       (C) An alien whose deportation is being withheld under 
     section 243(h) of such Act.
       (2) Veteran and active duty exception.--An alien who is 
     lawfully residing in any State and is--
       (A) a veteran (as defined in section 101 of title 38, 
     United States Code) with a discharge characterized as an 
     honorable discharge and not on account of alienage,
       (B) on active duty (other than active duty for training) in 
     the Armed Forces of the United States, or
       (C) the spouse or unmarried dependent child of an 
     individual described in subparagraph (A) or (B).
       (c) Federal Means-tested Public Benefit Defined.--
       (1) Except as provided in paragraph (2), for purposes of 
     this subtitle, the term ``Federal means-tested public 
     benefit'' means a public benefit (including cash, medical, 
     housing, and food assistance and social services) of the 
     Federal Government in which the eligibility of an individual, 
     household, or family eligibility unit for benefits, or the 
     amount of such benefits, or both are determined on the basis 
     of income, resources, or financial need of the individual, 
     household, or unit.
       (2) Such term does not include the following:
       (A) Emergency medical services under title XIX of the 
     Social Security Act.
       (B) Short-term, non-cash, in-kind emergency disaster 
     relief.
       (C) Assistance or benefits under the National School Lunch 
     Act.
       (D) Assistance or benefits under the Child Nutrition Act of 
     1966.
       (E) Public health assistance for immunizations with respect 
     to immunizable diseases and for testing and treatment of 
     symptoms of communicable diseases whether or not such 
     symptoms are caused by a communicable disease.
       (F) Payments for foster care and adoption assistance under 
     parts B and E of title IV of the Social Security Act for a 
     child who would, in the absence of subsection (a), be 
     eligible to have such payments made on the child's behalf 
     under such part, but only if the foster or adoptive parent or 
     parents of such child are not described under subsection (a).
       (G) Programs, services, or assistance (such as soup 
     kitchens, crisis counseling and intervention, and short-term 
     shelter) specified by the Attorney General, in the Attorney 
     General's sole and unreviewable discretion after consultation 
     with appropriate Federal agencies and departments, which (i) 
     deliver in-kind services at the community level, including 
     through public or private nonprofit agencies; (ii) do not 
     condition the provision of assistance, the amount of 
     assistance provided, or the cost of assistance provided on 
     the individual recipient's income or resources; and (iii) are 
     necessary for the protection of life or safety.
       (H) Programs of student assistance under titles IV, V, IX, 
     and X of the Higher Education Act of 1965.
       (I) Means-tested programs under the Elementary and 
     Secondary Education Act of 1965.
       (J) Benefits under the Head Start Act.
       (K) Benefits under the Job Training Partnership Act.

     SEC. 4404. NOTIFICATION AND INFORMATION REPORTING.

       (a) Notification.--Each Federal agency that administers a 
     program to which section 4401, 4402, or 4403 applies shall, 
     directly or through the States, post information and provide 
     general notification to the public and to program recipients 
     of the changes regarding eligibility for any such program 
     pursuant to this chapter.
       (b) Information Reporting Under Title IV of the Social 
     Security Act.--Part A of title IV of the Social Security Act, 
     as amended by section 4103(a) of this Act, is amended by 
     inserting the following new section after section 411:

     ``SEC. 411A. STATE REQUIRED TO PROVIDE CERTAIN INFORMATION.

       ``Each State to which a grant is made under section 403 
     shall, at least 4 times annually and upon request of the 
     Immigration and Naturalization Service, furnish the 
     Immigration and Naturalization Service with the name and 
     address of, and other identifying information on, any 
     individual who the State knows is unlawfully in the United 
     States.''.
       (c) SSI.--Section 1631(e) of such Act (42 U.S.C. 1383(e)) 
     is amended--
       (1) by redesignating the paragraphs (6) and (7) inserted by 
     sections 206(d)(2) and 206(f)(1) of the Social Security 
     Independence and Programs Improvement Act of 1994 (Public Law 
     103-296; 108 Stat. 1514, 1515) as paragraphs (7) and (8), 
     respectively; and
       (2) by adding at the end the following new paragraph:
       ``(9) Notwithstanding any other provision of law, the 
     Commissioner shall, at least 4 times annually and upon 
     request of the Immigration and Naturalization Service 
     (hereafter in this paragraph referred to as the `Service'), 
     furnish the Service with the name and address of, and other 
     identifying information on, any individual who the 
     Commissioner knows is unlawfully in the United States, and 
     shall ensure that each agreement entered into under section 
     1616(a) with a State provides that the State shall furnish 
     such information at such times with respect to any individual 
     who the State knows is unlawfully in the United States.''.
       (d) Information Reporting for Housing Programs.--Title I of 
     the United States Housing Act of 1937 (42 U.S.C. 1437 et 
     seq.) is amended by adding at the end the following new 
     section:

     ``SEC. 27. PROVISION OF INFORMATION TO LAW ENFORCEMENT AND 
                   OTHER AGENCIES.

       ``Notwithstanding any other provision of law, the Secretary 
     shall, at least 4 times annually and upon request of the 
     Immigration and Naturalization Service (hereafter in this 
     section referred to as the `Service'), furnish the Service 
     with the name and address of, and other identifying 
     information on, any individual who the Secretary knows is 
     unlawfully in the United States, and shall ensure that each 
     contract for assistance entered into under section 6 or 8 of 
     this Act with a public housing agency provides that the 
     public housing agency shall furnish such information at such 
     times with respect to any individual who the public housing 
     agency knows is unlawfully in the United States.''.

  CHAPTER 2--ELIGIBILITY FOR STATE AND LOCAL PUBLIC BENEFITS PROGRAMS

     SEC. 4411. ALIENS WHO ARE NOT QUALIFIED ALIENS OR 
                   NONIMMIGRANTS INELIGIBLE FOR STATE AND LOCAL 
                   PUBLIC BENEFITS.

       (a) In General.--Notwithstanding any other provision of law 
     and except as provided in subsections (b) and (d), an alien 
     who is not--
       (1) a qualified alien (as defined in section 4431),
       (2) a nonimmigrant under the Immigration and Nationality 
     Act, or
       (3) an alien who is paroled into the United States under 
     section 212(d)(5) of such Act for less than one year,

     is not eligible for any State or local public benefit (as 
     defined in subsection (c)).
       (b) Exceptions.--Subsection (a) shall not apply with 
     respect to the following State or local public benefits:
       (1) Emergency medical services under title XIX of the 
     Social Security Act.

[[Page H7887]]

       (2) Short-term, non-cash, in-kind emergency disaster 
     relief.
       (3) Public health assistance for immunizations with respect 
     to immunizable diseases and for testing and treatment of 
     symptoms of communicable diseases whether or not such 
     symptoms are caused by a communicable disease.
       (4) Programs, services, or assistance (such as soup 
     kitchens, crisis counseling and intervention, and short-term 
     shelter) specified by the Attorney General, in the Attorney 
     General's sole and unreviewable discretion after consultation 
     with appropriate Federal agencies and departments, which (A) 
     deliver in-kind services at the community level, including 
     through public or private nonprofit agencies; (B) do not 
     condition the provision of assistance, the amount of 
     assistance provided, or the cost of assistance provided on 
     the individual recipient's income or resources; and (C) are 
     necessary for the protection of life or safety.
       (c) State or Local Public Benefit Defined.--
       (1) Except as provided in paragraph (2), for purposes of 
     this chapter the term ``State or local public benefit'' 
     means--
       (A) any grant, contract, loan, professional license, or 
     commercial license provided by an agency of a State or local 
     government or by appropriated funds of a State or local 
     government; and
       (B) any retirement, welfare, health, disability, public or 
     assisted housing, postsecondary education, food assistance, 
     unemployment benefit, or any other similar benefit for which 
     payments or assistance are provided to an individual, 
     household, or family eligibility unit by an agency of a State 
     or local government or by appropriated funds of a State or 
     local government.
       (2) Such term shall not apply--
       (A) to any contract, professional license, or commercial 
     license for a nonimmigrant whose visa for entry is related to 
     such employment in the United States; or
       (B) with respect to benefits for an alien who as a work 
     authorized nonimmigrant or as an alien lawfully admitted for 
     permanent residence under the Immigration and Nationality Act 
     qualified for such benefits and for whom the United States 
     under reciprocal treaty agreements is required to pay 
     benefits, as determined by the Secretary of State, after 
     consultation with the Attorney General.
       (d) State Authority to Provide for Eligibility of Illegal 
     Aliens for State and Local Public Benefits.--A State may 
     provide that an alien who is not lawfully present in the 
     United States is eligible for any State or local public 
     benefit for which such alien would otherwise be ineligible 
     under subsection (a) only through the enactment of a State 
     law after the date of the enactment of this Act which 
     affirmatively provides for such eligibility.

     SEC. 4412. STATE AUTHORITY TO LIMIT ELIGIBILITY OF QUALIFIED 
                   ALIENS FOR STATE PUBLIC BENEFITS.

       (a) In General.--Notwithstanding any other provision of law 
     and except as provided in subsection (b), a State is 
     authorized to determine the eligibility for any State public 
     benefits (as defined in subsection (c) of an alien who is a 
     qualified alien (as defined in section 4431), a nonimmigrant 
     under the Immigration and Nationality Act, or an alien who is 
     paroled into the United States under section 212(d)(5) of 
     such Act for less than one year.
       (b) Exceptions.--Qualified aliens under this subsection 
     shall be eligible for any State public benefits.
       (1) Time-limited exception for refugees and asylees.--
       (A) An alien who is admitted to the United States as a 
     refugee under section 207 of the Immigration and Nationality 
     Act until 5 years after the date of an alien's entry into the 
     United States.
       (B) An alien who is granted asylum under section 208 of 
     such Act until 5 years after the date of such grant of 
     asylum.
       (C) An alien whose deportation is being withheld under 
     section 243(h) of such Act until 5 years after such 
     withholding.
       (2) Certain permanent resident aliens.--An alien who--
       (A) is lawfully admitted to the United States for permanent 
     residence under the Immigration and Nationality Act; and
       (B)(i) has worked 40 qualifying quarters of coverage as 
     defined under title II of the Social Security Act or can be 
     credited with such qualifying quarters as provided under 
     section 4435, and (ii) did not receive any Federal means-
     tested public benefit (as defined in section 4403(c)) during 
     any such quarter.
       (3) Veteran and active duty exception.--An alien who is 
     lawfully residing in any State and is--
       (A) a veteran (as defined in section 101 of title 38, 
     United States Code) with a discharge characterized as an 
     honorable discharge and not on account of alienage,
       (B) on active duty (other than active duty for training) in 
     the Armed Forces of the United States, or
       (C) the spouse or unmarried dependent child of an 
     individual described in subparagraph (A) or (B).
       (4) Transition for those currently receiving benefits.--An 
     alien who on the date of the enactment of this Act is 
     lawfully residing in any State and is receiving benefits on 
     the date of the enactment of this Act shall continue to be 
     eligible to receive such benefits until January 1, 1997.
       (c) State Public Benefits Defined.--The term ``State public 
     benefits'' means any means-tested public benefit of a State 
     or political subdivision of a State under which the State or 
     political subdivision specifies the standards for 
     eligibility, and does not include any Federal public benefit.

       CHAPTER 3--ATTRIBUTION OF INCOME AND AFFIDAVITS OF SUPPORT

     SEC. 4421. FEDERAL ATTRIBUTION OF SPONSOR'S INCOME AND 
                   RESOURCES TO ALIEN.

       (a) In General.--Notwithstanding any other provision of 
     law, in determining the eligibility and the amount of 
     benefits of an alien for any Federal means-tested public 
     benefits program (as defined in section 4403(c)), the income 
     and resources of the alien shall be deemed to include the 
     following:
       (1) The income and resources of any person who executed an 
     affidavit of support pursuant to section 213A of the 
     Immigration and Nationality Act (as added by section 4423) on 
     behalf of such alien.
       (2) The income and resources of the spouse (if any) of the 
     person.
       (b) Application.--Subsection (a) shall apply with respect 
     to an alien until such time as the alien--
       (1) achieves United States citizenship through 
     naturalization pursuant to chapter 2 of title III of the 
     Immigration and Nationality Act; or
       (2)(A) has worked 40 qualifying quarters of coverage as 
     defined under title II of the Social Security Act or can be 
     credited with such qualifying quarters as provided under 
     section 4435, and (B) did not receive any Federal means-
     tested public benefit (as defined in section 4403(c)) during 
     any such quarter.
       (c) Review of Income and Resources of Alien Upon 
     Reapplication.--Whenever an alien is required to reapply for 
     benefits under any Federal means-tested public benefits 
     program, the applicable agency shall review the income and 
     resources attributed to the alien under subsection (a).
       (d) Application.--
       (1) If on the date of the enactment of this Act, a Federal 
     means-tested public benefits program attributes a sponsor's 
     income and resources to an alien in determining the alien's 
     eligibility and the amount of benefits for an alien, this 
     section shall apply to any such determination beginning on 
     the day after the date of the enactment of this Act.
       (2) If on the date of the enactment of this Act, a Federal 
     means-tested public benefits program does not attribute a 
     sponsor's income and resources to an alien in determining the 
     alien's eligibility and the amount of benefits for an alien, 
     this section shall apply to any such determination beginning 
     180 days after the date of the enactment of this Act.

     SEC. 4422. AUTHORITY FOR STATES TO PROVIDE FOR ATTRIBUTION OF 
                   SPONSORS INCOME AND RESOURCES TO THE ALIEN WITH 
                   RESPECT TO STATE PROGRAMS.

       (a) Optional Application to State Programs.--Except as 
     provided in subsection (b), in determining the eligibility 
     and the amount of benefits of an alien for any State public 
     benefits (as defined in section 4412(c)), the State or 
     political subdivision that offers the benefits is authorized 
     to provide that the income and resources of the alien shall 
     be deemed to include--
       (1) the income and resources of any individual who executed 
     an affidavit of support pursuant to section 213A of the 
     Immigration and Nationality Act (as added by section 4423) on 
     behalf of such alien, and
       (2) the income and resources of the spouse (if any) of the 
     individual.
       (b) Exceptions.--Subsection (a) shall not apply with 
     respect to the following State public benefits:
       (1) Emergency medical services.
       (2) Short-term, non-cash, in-kind emergency disaster 
     relief.
       (3) Programs comparable to assistance or benefits under the 
     National School Lunch Act.
       (4) Programs comparable to assistance or benefits under the 
     Child Nutrition Act of 1966.
       (5) Public health assistance for immunizations with respect 
     to immunizable diseases and for testing and treatment of 
     symptoms of communicable diseases whether or not such 
     symptoms are caused by a communicable disease.
       (6) Payments for foster care and adoption assistance.
       (7) Programs, services, or assistance (such as soup 
     kitchens, crisis counseling and intervention, and short-term 
     shelter) specified by the Attorney General of a State, after 
     consultation with appropriate agencies and departments, which 
     (A) deliver in-kind services at the community level, 
     including through public or private nonprofit agencies; (B) 
     do not condition the provision of assistance, the amount of 
     assistance provided, or the cost of assistance provided on 
     the individual recipient's income or resources; and (C) are 
     necessary for the protection of life or safety.

     SEC. 4423. REQUIREMENTS FOR SPONSOR'S AFFIDAVIT OF SUPPORT.

       (a) In General.--Title II of the Immigration and 
     Nationality Act is amended by inserting after section 213 the 
     following new section:


           ``requirements for sponsor's affidavit of support

       ``Sec. 213A. (a) Enforceability.--(1) No affidavit of 
     support may be accepted by the Attorney General or by any 
     consular officer to establish that an alien is not excludable 
     as a public charge under section 212(a)(4) unless such 
     affidavit is executed as a contract--

[[Page H7888]]

       ``(A) which is legally enforceable against the sponsor by 
     the sponsored alien, the Federal Government, and by any State 
     (or any political subdivision of such State) which provides 
     any means-tested public benefits program, but not later than 
     10 years after the alien last receives any such benefit;
       ``(B) in which the sponsor agrees to financially support 
     the alien, so that the alien will not become a public charge; 
     and
       ``(C) in which the sponsor agrees to submit to the 
     jurisdiction of any Federal or State court for the purpose of 
     actions brought under subsection (e)(2).
       ``(2) A contract under paragraph (1) shall be enforceable 
     with respect to benefits provided to the alien until such 
     time as the alien achieves United States citizenship through 
     naturalization pursuant to chapter 2 of title III.
       ``(b) Forms.--Not later than 90 days after the date of 
     enactment of this section, the Attorney General, in 
     consultation with the Secretary of State and the Secretary of 
     Health and Human Services, shall formulate an affidavit of 
     support consistent with the provisions of this section.
       ``(c) Remedies.--Remedies available to enforce an affidavit 
     of support under this section include any or all of the 
     remedies described in section 3201, 3203, 3204, or 3205 of 
     title 28, United States Code, as well as an order for 
     specific performance and payment of legal fees and other 
     costs of collection, and include corresponding remedies 
     available under State law. A Federal agency may seek to 
     collect amounts owed under this section in accordance with 
     the provisions of subchapter II of chapter 37 of title 31, 
     United States Code.
       ``(d) Notification of Change of Address.--
       ``(1) In general.--The sponsor shall notify the Attorney 
     General and the State in which the sponsored alien is 
     currently resident within 30 days of any change of address of 
     the sponsor during the period specified in subsection (a)(2).
       ``(2) Penalty.--Any person subject to the requirement of 
     paragraph (1) who fails to satisfy such requirement shall be 
     subject to a civil penalty of--
       ``(A) not less than $250 or more than $2,000, or
       ``(B) if such failure occurs with knowledge that the alien 
     has received any means-tested public benefit, not less than 
     $2,000 or more than $5,000.
       ``(e) Reimbursement of Government Expenses.--(1)(A) Upon 
     notification that a sponsored alien has received any benefit 
     under any means-tested public benefits program, the 
     appropriate Federal, State, or local official shall request 
     reimbursement by the sponsor in the amount of such 
     assistance.
       ``(B) The Attorney General, in consultation with the 
     Secretary of Health and Human Services, shall prescribe such 
     regulations as may be necessary to carry out subparagraph 
     (A).
       ``(2) If within 45 days after requesting reimbursement, the 
     appropriate Federal, State, or local agency has not received 
     a response from the sponsor indicating a willingness to 
     commence payments, an action may be brought against the 
     sponsor pursuant to the affidavit of support.
       ``(3) If the sponsor fails to abide by the repayment terms 
     established by such agency, the agency may, within 60 days of 
     such failure, bring an action against the sponsor pursuant to 
     the affidavit of support.
       ``(4) No cause of action may be brought under this 
     subsection later than 10 years after the alien last received 
     any benefit under any means-tested public benefits program.
       ``(5) If, pursuant to the terms of this subsection, a 
     Federal, State, or local agency requests reimbursement from 
     the sponsor in the amount of assistance provided, or brings 
     an action against the sponsor pursuant to the affidavit of 
     support, the appropriate agency may appoint or hire an 
     individual or other person to act on behalf of such agency 
     acting under the authority of law for purposes of collecting 
     any moneys owed. Nothing in this subsection shall preclude 
     any appropriate Federal, State, or local agency from directly 
     requesting reimbursement from a sponsor for the amount of 
     assistance provided, or from bringing an action against a 
     sponsor pursuant to an affidavit of support.
       ``(f) Definitions.--For the purposes of this section--
       ``(1) Sponsor.--The term `sponsor' means an individual 
     who--
       ``(A) is a citizen or national of the United States or an 
     alien who is lawfully admitted to the United States for 
     permanent residence;
       ``(B) is 18 years of age or over;
       ``(C) is domiciled in any of the 50 States or the District 
     of Columbia; and
       ``(D) is the person petitioning for the admission of the 
     alien under section 204.
       ``(2) Means-tested public benefits program.--The term 
     `means-tested public benefits program' means a program of 
     public benefits (including cash, medical, housing, and food 
     assistance and social services) of the Federal Government or 
     of a State or political subdivision of a State in which the 
     eligibility of an individual, household, or family 
     eligibility unit for benefits under the program, or the 
     amount of such benefits, or both are determined on the basis 
     of income, resources, or financial need of the individual, 
     household, or unit.''.
       (b) Clerical Amendment.--The table of contents of such Act 
     is amended by inserting after the item relating to section 
     213 the following:

``Sec. 213A. Requirements for sponsor's affidavit of support.''.
       (c) Effective Date.--Subsection (a) of section 213A of the 
     Immigration and Nationality Act, as inserted by subsection 
     (a) of this section, shall apply to affidavits of support 
     executed on or after a date specified by the Attorney 
     General, which date shall be not earlier than 60 days (and 
     not later than 90 days) after the date the Attorney General 
     formulates the form for such affidavits under subsection (b) 
     of such section.
       (d) Benefits Not Subject to Reimbursement.--Requirements 
     for reimbursement by a sponsor for benefits provided to a 
     sponsored alien pursuant to an affidavit of support under 
     section 213A of the Immigration and Nationality Act shall not 
     apply with respect to the following:
       (1) Emergency medical services under title XIX of the 
     Social Security Act.
       (2) Short-term, non-cash, in-kind emergency disaster 
     relief.
       (3) Assistance or benefits under the National School Lunch 
     Act.
       (4) Assistance or benefits under the Child Nutrition Act of 
     1966.
       (5) Public health assistance for immunizations with respect 
     to immunizable diseases and for testing and treatment of 
     symptoms of communicable diseases whether or not such 
     symptoms are caused by a communicable disease.
       (6) Payments for foster care and adoption assistance under 
     part B of title IV of the Social Security Act for a child, 
     but only if the foster or adoptive parent or parents of such 
     child are not otherwise ineligible pursuant to section 4403 
     of this Act.
       (7) Programs, services, or assistance (such as soup 
     kitchens, crisis counseling and intervention, and short-term 
     shelter) specified by the Attorney General, in the Attorney 
     General's sole and unreviewable discretion after consultation 
     with appropriate Federal agencies and departments, which (A) 
     deliver in-kind services at the community level, including 
     through public or private nonprofit agencies; (B) do not 
     condition the provision of assistance, the amount of 
     assistance provided, or the cost of assistance provided on 
     the individual recipient's income or resources; and (C) are 
     necessary for the protection of life or safety.
       (8) Programs of student assistance under titles IV, V, IX, 
     and X of the Higher Education Act of 1965.
       (9) Benefits under the Head Start Act.
       (10) Means-tested programs under the Elementary and 
     Secondary Education Act of 1965.
       (11) Benefits under the Job Training Partnership Act.

                     CHAPTER 4--GENERAL PROVISIONS

     SEC. 4431. DEFINITIONS.

       (a) In General.--Except as otherwise provided in this 
     subtitle, the terms used in this subtitle have the same 
     meaning given such terms in section 101(a) of the Immigration 
     and Nationality Act.
       (b) Qualified Alien.--For purposes of this subtitle, the 
     term ``qualified alien'' means an alien who, at the time the 
     alien applies for, receives, or attempts to receive a Federal 
     public benefit, is--
       (1) an alien who is lawfully admitted for permanent 
     residence under the Immigration and Nationality Act,
       (2) an alien who is granted asylum under section 208 of 
     such Act,
       (3) a refugee who is admitted to the United States under 
     section 207 of such Act,
       (4) an alien who is paroled into the United States under 
     section 212(d)(5) of such Act for a period of at least 1 
     year,
       (5) an alien whose deportation is being withheld under 
     section 243(h) of such Act, or
       (6) an alien who is granted conditional entry pursuant to 
     section 203(a)(7) of such Act as in effect prior to April 1, 
     1980.

     SEC. 4432. VERIFICATION OF ELIGIBILITY FOR FEDERAL PUBLIC 
                   BENEFITS.

       (a) In General.--Not later than 18 months after the date of 
     the enactment of this Act, the Attorney General of the United 
     States, after consultation with the Secretary of Health and 
     Human Services, shall promulgate regulations requiring 
     verification that a person applying for a Federal public 
     benefit (as defined in section 4401(c)), to which the 
     limitation under section 4401 applies, is a qualified alien 
     and is eligible to receive such benefit. Such regulations 
     shall, to the extent feasible, require that information 
     requested and exchanged be similar in form and manner to 
     information requested and exchanged under section 1137 of the 
     Social Security Act.
       (b) State Compliance.--Not later than 24 months after the 
     date the regulations described in subsection (a) are adopted, 
     a State that administers a program that provides a Federal 
     public benefit shall have in effect a verification system 
     that complies with the regulations.
       (c) Authorization of Appropriations.--There are authorized 
     to be appropriated such sums as may be necessary to carry out 
     the purpose of this section.

     SEC. 4433. STATUTORY CONSTRUCTION.

       (a) Limitation.--
       (1) Nothing in this subtitle may be construed as an 
     entitlement or a determination of an individual's eligibility 
     or fulfillment of the requisite requirements for any Federal, 
     State, or local governmental program, assistance, or 
     benefits. For purposes of this subtitle, eligibility relates 
     only to the general issue of eligibility or ineligibility on 
     the basis of alienage.

[[Page H7889]]

       (2) Nothing in this subtitle may be construed as addressing 
     alien eligibility for a basic public education as determined 
     by the Supreme Court of the United States under Plyler v. Doe 
     (457 U.S. 202)(1982).
       (b) Not Applicable to Foreign Assistance.--This subtitle 
     does not apply to any Federal, State, or local governmental 
     program, assistance, or benefits provided to an alien under 
     any program of foreign assistance as determined by the 
     Secretary of State in consultation with the Attorney General.
       (c) Severability.--If any provision of this subtitle or the 
     application of such provision to any person or circumstance 
     is held to be unconstitutional, the remainder of this 
     subtitle and the application of the provisions of such to any 
     person or circumstance shall not be affected thereby.

     SEC. 4434. COMMUNICATION BETWEEN STATE AND LOCAL GOVERNMENT 
                   AGENCIES AND THE IMMIGRATION AND NATURALIZATION 
                   SERVICE.

       Notwithstanding any other provision of Federal, State, or 
     local law, no State or local government entity may be 
     prohibited, or in any way restricted, from sending to or 
     receiving from the Immigration and Naturalization Service 
     information regarding the immigration status, lawful or 
     unlawful, of an alien in the United States.

     SEC. 4435. QUALIFYING QUARTERS.

       For purposes of this subtitle, in determining the number of 
     qualifying quarters of coverage under title II of the Social 
     Security Act an alien shall be credited with--
       (1) all of the qualifying quarters of coverage as defined 
     under title II of the Social Security Act worked by a parent 
     of such alien while the alien was under age 18 if the parent 
     did not receive any Federal means-tested public benefit (as 
     defined in section 4403(c)) during any such quarter, and
       (2) all of the qualifying quarters worked by a spouse of 
     such alien during their marriage if the spouse did not 
     receive any Federal means-tested public benefit (as defined 
     in section 4403(c)) during any such quarter and the alien 
     remains married to such spouse or such spouse is deceased.

     CHAPTER 5--CONFORMING AMENDMENTS RELATING TO ASSISTED HOUSING

     SEC. 4441. CONFORMING AMENDMENTS RELATING TO ASSISTED 
                   HOUSING.

       (a) Limitations on Assistance.--Section 214 of the Housing 
     and Community Development Act of 1980 (42 U.S.C. 1436a) is 
     amended--
       (1) by striking ``Secretary of Housing and Urban 
     Development'' each place it appears and inserting 
     ``applicable Secretary'';
       (2) in subsection (b), by inserting after ``National 
     Housing Act,'' the following: ``the direct loan program under 
     section 502 of the Housing Act of 1949 or section 
     502(c)(5)(D), 504, 521(a)(2)(A), or 542 of such Act, subtitle 
     A of title III of the Cranston-Gonzalez National Affordable 
     Housing Act,'';
       (3) in paragraphs (2) through (6) of subsection (d), by 
     striking ``Secretary'' each place it appears and inserting 
     ``applicable Secretary'';
       (4) in subsection (d), in the matter following paragraph 
     (6), by striking ``the term `Secretary''' and inserting ``the 
     term `applicable Secretary'''; and
       (5) by adding at the end the following new subsection:
       ``(h) For purposes of this section, the term `applicable 
     Secretary' means--
       ``(1) the Secretary of Housing and Urban Development, with 
     respect to financial assistance administered by such 
     Secretary and financial assistance under subtitle A of title 
     III of the Cranston-Gonzalez National Affordable Housing Act; 
     and
       ``(2) the Secretary of Agriculture, with respect to 
     financial assistance administered by such Secretary.''.
       (b) Conforming Amendments.--Section 501(h) of the Housing 
     Act of 1949 (42 U.S.C. 1471(h)) is amended--
       (1) by striking ``(1)'';
       (2) by striking ``by the Secretary of Housing and Urban 
     Development''; and
       (3) by striking paragraph (2).

    CHAPTER 6--EARNED INCOME CREDIT DENIED TO UNAUTHORIZED EMPLOYEES

     SEC. 4451. EARNED INCOME CREDIT DENIED TO INDIVIDUALS NOT 
                   AUTHORIZED TO BE EMPLOYED IN THE UNITED STATES.

       (a) In General.--Section 32(c)(1) of the Internal Revenue 
     Code of 1986 (relating to individuals eligible to claim the 
     earned income credit) is amended by adding at the end the 
     following new subparagraph:
       ``(F) Identification number requirement.--The term 
     `eligible individual' does not include any individual who 
     does not include on the return of tax for the taxable year--
       ``(i) such individual's taxpayer identification number, and
       ``(ii) if the individual is married (within the meaning of 
     section 7703), the taxpayer identification number of such 
     individual's spouse.''.
       (b) Special Identification Number.--Section 32 of such Code 
     is amended by adding at the end the following new subsection:
       ``(l) Identification Numbers.--Solely for purposes of 
     subsections (c)(1)(F) and (c)(3)(D), a taxpayer 
     identification number means a social security number issued 
     to an individual by the Social Security Administration (other 
     than a social security number issued pursuant to clause (II) 
     (or that portion of clause (III) that relates to clause (II)) 
     of section 205(c)(2)(B)(i) of the Social Security Act).''.
       (c) Extension of Procedures Applicable to Mathematical or 
     Clerical Errors.--Section 6213(g)(2) of such Code (relating 
     to the definition of mathematical or clerical errors) is 
     amended by striking ``and' at the end of subparagraph (D), by 
     striking the period at the end of subparagraph (E) and 
     inserting a comma, and by inserting after subparagraph (E) 
     the following new subparagraphs:
       ``(F) an omission of a correct taxpayer identification 
     number required under section 32 (relating to the earned 
     income tax credit) to be included on a return, and
       ``(G) an entry on a return claiming the credit under 
     section 32 with respect to net earnings from self-employment 
     described in section 32(c)(2)(A) to the extent the tax 
     imposed by section 1401 (relating to self-employment tax) on 
     such net earnings has not been paid.''
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1995.
                  Subtitle E--Reform of Public Housing

     SEC. 4601. FRAUD UNDER MEANS-TESTED WELFARE AND PUBLIC 
                   ASSISTANCE PROGRAMS.

       (a) In General.--If an individual's benefits under a 
     Federal, State, or local law relating to a means-tested 
     welfare or a public assistance program are reduced because of 
     an act of fraud by the individual under the law or program, 
     the individual may not, for the duration of the reduction, 
     receive an increased benefit under any other means-tested 
     welfare or public assistance program for which Federal funds 
     are appropriated as a result of a decrease in the income of 
     the individual (determined under the applicable program) 
     attributable to such reduction.
       (b) Welfare or Public Assistance Programs for Which Federal 
     Funds Are Appropriated.--For purposes of subsection (a), the 
     term ``means-tested welfare or public assistance program for 
     which Federal funds are appropriated'' includes the food 
     stamp program under the Food Stamp Act of 1977 (7 U.S.C. 2011 
     et seq.), any program of public or assisted housing under 
     title I of the United States Housing Act of 1937 (42 U.S.C. 
     1437 et seq.), and State programs funded under part A of 
     title IV of the Social Security Act (42 U.S.C. 601 et seq.).
  Subtitle F--Child Protection Block Grant Programs and Foster Care, 
          Adoption Assistance, and Independent Living Programs

   CHAPTER 1--CHILD PROTECTION BLOCK GRANT PROGRAM AND FOSTER CARE, 
          ADOPTION ASSISTANCE, AND INDEPENDENT LIVING PROGRAMS

  Subchapter A--Block Grants to States for the Protection of Children

     SEC. 4701. ESTABLISHMENT OF PROGRAM.

       Title IV of the Social Security Act (42 U.S.C. 601 et seq.) 
     is amended by striking part B and inserting the following:

    ``PART B--BLOCK GRANTS TO STATES FOR THE PROTECTION OF CHILDREN

     ``SEC. 421. PURPOSE.

       ``The purpose of this part is to enable eligible States to 
     carry out a child protection program to--
       ``(1) identify and assist families at risk of abusing or 
     neglecting their children;
       ``(2) operate a system for receiving reports of abuse or 
     neglect of children;
       ``(3) improve the intake, assessment, screening, and 
     investigation of reports of abuse and neglect;
       ``(4) enhance the general child protective system by 
     improving risk and safety assessment tools and protocols;
       ``(5) improve legal preparation and representation, 
     including procedures for appealing and responding to appeals 
     of substantiated reports of abuse and neglect;
       ``(6) provide support, treatment, and family preservation 
     services to families which are, or are at risk of, abusing or 
     neglecting their children;
       ``(7) support children who must be removed from or who 
     cannot live with their families;
       ``(8) make timely decisions about permanent living 
     arrangements for children who must be removed from or who 
     cannot live with their families;
       ``(9) provide for continuing evaluation and improvement of 
     child protection laws, regulations, and services;
       ``(10) develop and facilitate training protocols for 
     individuals mandated to report child abuse or neglect; and
       ``(11) develop and enhance the capacity of community-based 
     programs to integrate shared leadership strategies between 
     parents and professionals to prevent and treat child abuse 
     and neglect at the neighborhood level.

     ``SEC. 422. ELIGIBLE STATES.

       ``(a) In General.--As used in this part, the term `eligible 
     State' means a State that has submitted to the Secretary, not 
     later than October 1, 1996, and every 3 years thereafter, a 
     plan which has been signed by the chief executive officer of 
     the State and that includes the following:
       ``(1) Outline of child protection program.--A written 
     document that outlines the activities the State intends to 
     conduct to achieve the purpose of this part, including the 
     procedures to be used for--
       ``(A) receiving and assessing reports of child abuse or 
     neglect;
       ``(B) investigating such reports;
       ``(C) with respect to families in which abuse or neglect 
     has been confirmed, providing services or referral for 
     services for families and children where the State makes a 
     determination that the child may safely remain with the 
     family;

[[Page H7890]]

       ``(D) protecting children by removing them from dangerous 
     settings and ensuring their placement in a safe environment;
       ``(E) providing training for individuals mandated to report 
     suspected cases of child abuse or neglect;
       ``(F) protecting children in foster care;
       ``(G) promoting timely adoptions;
       ``(H) protecting the rights of families, using adult 
     relatives as the preferred placement for children separated 
     from their parents where such relatives meet the relevant 
     State child protection standards; and
       ``(I) providing services to individuals, families, or 
     communities, either directly or through referral, that are 
     aimed at preventing the occurrence of child abuse and 
     neglect.
       ``(2) Certification of state law requiring the reporting of 
     child abuse and neglect.--A certification that the State has 
     in effect laws that require public officials and other 
     professionals to report, in good faith, actual or suspected 
     instances of child abuse or neglect.
       ``(3) Certification of procedures for screening, safety 
     assessment, and prompt investigation.--A certification that 
     the State has in effect procedures for receiving and 
     responding to reports of child abuse or neglect, including 
     the reports described in paragraph (2), and for the immediate 
     screening, safety assessment, and prompt investigation of 
     such reports.
       ``(4) Certification of state procedures for removal and 
     placement of abused or neglected children.--A certification 
     that the State has in effect procedures for the removal from 
     families and placement of abused or neglected children and of 
     any other child in the same household who may also be in 
     danger of abuse or neglect.
       ``(5) Certification of provisions for immunity from 
     prosecution.--A certification that the State has in effect 
     laws requiring immunity from prosecution under State and 
     local laws and regulations for individuals making good faith 
     reports of suspected or known instances of child abuse or 
     neglect.
       ``(6) Certification of provisions and procedures relating 
     to appeals.--A certification that not later than 2 years 
     after the date of the enactment of this part, the State shall 
     have laws and procedures in effect affording individuals an 
     opportunity to appeal an official finding of abuse or 
     neglect.
       ``(7) Certification of state procedures for developing and 
     reviewing written plans for permanent placement of removed 
     children.--A certification that the State has in effect 
     procedures for ensuring that a written plan is prepared for 
     children who have been removed from their families. Such plan 
     shall specify the goals for achieving a permanent placement 
     for the child in a timely fashion, for ensuring that the 
     written plan is reviewed every 6 months (until such placement 
     is achieved), and for ensuring that information about such 
     children is collected regularly and recorded in case records, 
     and include a description of such procedures.
       ``(8) Certification of state program to provide independent 
     living services.--A certification that the State has in 
     effect a program to provide independent living services, for 
     assistance in making the transition to self-sufficient 
     adulthood, to individuals in the child protection program of 
     the State who are 16, but who are not 20 (or, at the option 
     of the State, 22), years of age, and who do not have a family 
     to which to be returned.
       ``(9) Certification of state procedures to respond to 
     reporting of medical neglect of disabled infants.--
       ``(A) In general.--A certification that the State has in 
     place for the purpose of responding to the reporting of 
     medical neglect of infants (including instances of 
     withholding of medically indicated treatment from disabled 
     infants with life-threatening conditions), procedures or 
     programs, or both (within the State child protective services 
     system), to provide for--
       ``(i) coordination and consultation with individuals 
     designated by and within appropriate health-care facilities;
       ``(ii) prompt notification by individuals designated by and 
     within appropriate health-care facilities of cases of 
     suspected medical neglect (including instances of withholding 
     of medically indicated treatment from disabled infants with 
     life-threatening conditions); and
       ``(iii) authority, under State law, for the State child 
     protective service to pursue any legal remedies, including 
     the authority to initiate legal proceedings in a court of 
     competent jurisdiction, as may be necessary to prevent the 
     withholding of medically indicated treatment from disabled 
     infants with life-threatening conditions.
       ``(B) Withholding of medically indicated treatment.--As 
     used in subparagraph (A), the term `withholding of medically 
     indicated treatment' means the failure to respond to the 
     infant's life-threatening conditions by providing treatment 
     (including appropriate nutrition, hydration, and medication) 
     which, in the treating physician's or physicians' reasonable 
     medical judgment, will be most likely to be effective in 
     ameliorating or correcting all such conditions, except that 
     such term does not include the failure to provide treatment 
     (other than appropriate nutrition, hydration, or medication) 
     to an infant when, in the treating physician's or physicians' 
     reasonable medical judgment--
       ``(i) the infant is chronically and irreversibly comatose;
       ``(ii) the provision of such treatment would--

       ``(I) merely prolong dying;
       ``(II) not be effective in ameliorating or correcting all 
     of the infant's life-threatening conditions; or
       ``(III) otherwise be futile in terms of the survival of the 
     infant; or

       ``(iii) the provision of such treatment would be virtually 
     futile in terms of the survival of the infant and the 
     treatment itself under such circumstances would be inhumane.
       ``(10) Identification of child protection goals.--The 
     quantitative goals of the State child protection program.
       ``(11) Certification of child protection standards.--With 
     respect to fiscal years beginning on or after April 1, 1996, 
     a certification that the State--
       ``(A) has completed an inventory of all children who, 
     before the inventory, had been in foster care under the 
     responsibility of the State for 6 months or more, which 
     determined--
       ``(i) the appropriateness of, and necessity for, the foster 
     care placement;
       ``(ii) whether the child could or should be returned to the 
     parents of the child or should be freed for adoption or other 
     permanent placement; and
       ``(iii) the services necessary to facilitate the return of 
     the child or the placement of the child for adoption or legal 
     guardianship;
       ``(B) is operating, to the satisfaction of the Secretary--
       ``(i) a statewide information system from which can be 
     readily determined the status, demographic characteristics, 
     location, and goals for the placement of every child who is 
     (or, within the immediately preceding 12 months, has been) in 
     foster care;
       ``(ii) a case review system for each child receiving foster 
     care under the supervision of the State;
       ``(iii) a service program designed to help children--

       ``(I) where appropriate, return to families from which they 
     have been removed; or
       ``(II) be placed for adoption, with a legal guardian, or if 
     adoption or legal guardianship is determined not to be 
     appropriate for a child, in some other planned, permanent 
     living arrangement; and

       ``(iv) a preplacement preventive services program designed 
     to help children at risk for foster care placement remain 
     with their families; and
       ``(C)(i) has reviewed (or not later than October 1, 1997, 
     will review) State policies and administrative and judicial 
     procedures in effect for children abandoned at or shortly 
     after birth (including policies and procedures providing for 
     legal representation of such children); and
       ``(ii) is implementing (or not later than October 1, 1997, 
     will implement) such policies and procedures as the State 
     determines, on the basis of the review described in clause 
     (i), to be necessary to enable permanent decisions to be made 
     expeditiously with respect to the placement of such children.
       ``(12) Certification of reasonable efforts before placement 
     of children in foster care.--A certification that the State 
     in each case will--
       ``(A) make reasonable efforts prior to the placement of a 
     child in foster care, to prevent or eliminate the need for 
     removal of the child from the child's home, and to make it 
     possible for the child to return home; and
       ``(B) with respect to families in which abuse or neglect 
     has been confirmed, provide services or referral for services 
     for families and children where the State makes a 
     determination that the child may safely remain with the 
     family.
       ``(13) Certification of cooperative efforts.--A 
     certification by the State, where appropriate, that all steps 
     will be taken, including cooperative efforts with the State 
     agencies administering the plans approved under parts A and 
     D, to secure an assignment to the State of any rights to 
     support on behalf of each child receiving foster care 
     maintenance payments under part E.
       ``(14) Certification of confidentiality and requirements 
     for information disclosure.--
       ``(A) In general.--A certification that the State has in 
     effect and operational--
       ``(i) requirements ensuring that reports and records made 
     and maintained pursuant to the purposes of this part shall 
     only be made available to--

       ``(I) individuals who are the subject of the report;
       ``(II) Federal, State, or local government entities, or any 
     agent of such entities, having a need for such information in 
     order to carry out their responsibilities under law to 
     protect children from abuse and neglect;
       ``(III) child abuse citizen review panels;
       ``(IV) child fatality review panels;
       ``(V) a grand jury or court, upon a finding that 
     information in the record is necessary for the determination 
     of an issue before the court or grand jury; and
       ``(VI) other entities or classes of individuals statutorily 
     authorized by the State to receive such information pursuant 
     to a legitimate State purpose; and

       ``(ii) provisions that allow for public disclosure of the 
     findings or information about cases of child abuse or neglect 
     that have resulted in a child fatality or near fatality.
       ``(B) Limitation.--Disclosures made pursuant to clause (i) 
     or (ii) shall not include the identifying information 
     concerning the individual initiating a report or complaint 
     alleging suspected instances of child abuse or neglect.
       ``(C) Definition.--For purposes of this paragraph, the term 
     `near fatality' means an

[[Page H7891]]

     act that, as certified by a physician, places the child in 
     serious or critical condition.
       ``(b) Determinations.--The Secretary shall determine 
     whether a plan submitted pursuant to subsection (a) contains 
     the material required by subsection (a), other than the 
     material described in paragraph (9) of such subsection. The 
     Secretary may not require a State to include in such a plan 
     any material not described in subsection (a).

     ``SEC. 423. GRANTS TO STATES FOR CHILD PROTECTION.

       ``(a) Funding of Block Grants.--
       ``(1) Entitlement component.--
       ``(A) Eligible states.--Each eligible State shall be 
     entitled to receive from the Secretary for each fiscal year 
     specified in subsection (b)(1) a grant in an amount equal to 
     the State share of 99 percent of the child protection amount 
     for the fiscal year.
       ``(B) Indian tribes and tribal organizations.--The 
     Secretary shall reserve for payments to Indian tribes (as 
     defined in section 658P(7) of the Child Care and Development 
     Block Grant Act of 1990) and tribal organizations (as defined 
     in section 658P(14) of such Act) for each fiscal year 
     specified in subsection (b)(1) an amount equal to 1 percent 
     of the child protection amount for the fiscal year.
       ``(2) Authorization component.--
       ``(A) In general.--
       ``(i) Eligible states.--For each eligible State for each 
     fiscal year specified in subsection (b)(1), the Secretary 
     shall supplement the grant under paragraph (1)(A) of this 
     subsection by an amount equal to the State share of 99.64 
     percent of the amount (if any) appropriated pursuant to 
     subparagraph (B) of this paragraph for the fiscal year.
       ``(ii) Indian tribes and tribal organizations.--The 
     Secretary shall supplement the amount reserved for payments 
     pursuant to paragraph (1)(B) of this subsection for each 
     fiscal year specified in subsection (b)(1), by an amount 
     equal to 0.36 percent of the amount (if any) appropriated 
     pursuant to subparagraph (B) of this paragraph for the fiscal 
     year.
       ``(B) Limitation on authorization of appropriations.--For 
     grants under subparagraph (A), there are authorized to be 
     appropriated to the Secretary an amount not to exceed 
     $325,000,000 for each fiscal year specified in subsection 
     (b)(1).
       ``(b) Definitions.--As used in this section:
       ``(1) Child protection amount.--The term `child protection 
     amount' means--
       ``(A) $240,000,000 for fiscal year 1997;
       ``(B) $255,000,000 for fiscal year 1998;
       ``(C) $262,000,000 for fiscal year 1999;
       ``(D) $270,000,000 for fiscal year 2000;
       ``(E) $278,000,000 for fiscal year 2001; and
       ``(F) $286,000,000 for fiscal year 2002;
       ``(2) State share.--
       ``(A) In general.--The term `State share' means the 
     qualified child protection expenses of the State divided by 
     the sum of the qualified child protection expenses of all of 
     the States.
       ``(B) Qualified child protection expenses.--The term 
     `qualified child protection expenses' means, with respect to 
     a State the greater of--
       ``(i) the total amount of one-third of the Federal grant 
     amounts to the State under the provisions of law specified in 
     clauses (i) and (ii) of subparagraph (C) for fiscal years 
     1992, 1993, and 1994; or
       ``(ii) the total amount of the Federal grant amounts to the 
     State under the provisions of law specified in clauses (i) 
     and (ii) of subparagraph (C) for fiscal year 1994.
       ``(C) Provisions of law.--The provisions of law specified 
     in this subparagraph are the following (as in effect with 
     respect to each of the fiscal years referred to in 
     subparagraph (B)):
       ``(i) Section 423 of this Act.
       ``(ii) Section 434 of this Act.
       ``(D) Determination of information.--In determining amounts 
     for fiscal years 1992, 1993, and 1994 under clauses (i) and 
     (ii) of subparagraph (B), the Secretary shall use information 
     listed as actual amounts in the Justification for Estimates 
     for Appropriation Committees of the Administration for 
     Children and Families for fiscal years 1994, 1995, and 1996, 
     respectively.
       ``(c) Use of Grant.--
       ``(1) In general.--A State to which a grant is made under 
     this section may use the grant in any manner that the State 
     deems appropriate to accomplish the purpose of this part.
       ``(2) Timing of expenditures.--A State to which a grant is 
     made under this section for a fiscal year shall expend the 
     total amount of the grant not later than the end of the 
     immediately succeeding fiscal year.
       ``(3) Rule of interpretation.--This part shall not be 
     interpreted to prohibit short- and long-term foster care 
     facilities operated for profit from receiving funds provided 
     under this part or part E.
       ``(4) Prohibition against use of funds for foster care 
     maintenance or adoption assistance payments.--Funds provided 
     under this part shall not be used to make foster care 
     maintenance payments or adoption assistance payments under 
     any State plan approved under part E.
       ``(d) Timing of Payments.--The Secretary shall pay each 
     eligible State the amount of the grant payable to the State 
     under this section in quarterly installments.
       ``(e) Penalties.--
       ``(1) For use of grant in violation of this part.--If an 
     audit conducted pursuant to chapter 75 of title 31, United 
     States Code, finds that an amount paid to a State under 
     this section for a fiscal year has been used in violation 
     of this part, then the Secretary shall reduce the amount 
     of the grant that would (in the absence of this paragraph) 
     be payable to the State under this section for the 
     immediately succeeding fiscal year by the amount so used, 
     plus 5 percent of the grant paid under this section to the 
     State for such fiscal year.
       ``(2) For failure to maintain effort.--
       ``(A) In general.--If an audit conducted pursuant to 
     chapter 75 of title 31, United States Code, finds that the 
     amount expended by a State (other than from amounts provided 
     by the Federal Government) during the fiscal years specified 
     in subparagraph (B), to carry out the State program funded 
     under this part is less than the applicable percentage 
     specified in such subparagraph of the total amount expended 
     by the State (other than from amounts provided by the Federal 
     Government) during fiscal year 1994 under part B of this 
     title (as in effect on the day before the date of the 
     enactment of this part), then the Secretary shall reduce the 
     amount of the grant that would (in the absence of this 
     paragraph) be payable to the State under this section for the 
     immediately succeeding fiscal year by the amount of the 
     difference, plus 5 percent of the grant paid under this 
     section to the State for such fiscal year.
       ``(B) Specification of fiscal years and applicable 
     percentages.--The fiscal years and applicable percentages 
     specified in this subparagraph are as follows:
       ``(i) For fiscal years 1997 and 1998, 100 percent.
       ``(ii) For fiscal years 1999 through 2002, 75 percent.
       ``(3) For failure to submit required report.--
       ``(A) In general.--The Secretary shall reduce by 3 percent 
     the amount of the grant that would (in the absence of this 
     paragraph) be payable to a State under this section for a 
     fiscal year if the Secretary determines that the State has 
     not submitted the report required by section 424 for the 
     immediately preceding fiscal year, within 6 months after the 
     end of the immediately preceding fiscal year.
       ``(B) Rescission of penalty.--The Secretary shall rescind a 
     penalty imposed on a State under subparagraph (A) with 
     respect to a report for a fiscal year if the State submits 
     the report before the end of the immediately succeeding 
     fiscal year.
       ``(4) State funds to replace reductions in grant.--A State 
     which has a penalty imposed against it under this subsection 
     for a fiscal year shall expend additional State funds in an 
     amount equal to the amount of the penalty for the purpose of 
     carrying out the State program under this part during the 
     immediately succeeding fiscal year.
       ``(5) Reasonable cause exception.--Except in the case of 
     the penalty described in paragraph (2), the Secretary may not 
     impose a penalty on a State under this subsection with 
     respect to a requirement if the Secretary determines that the 
     State has reasonable cause for failing to comply with the 
     requirement.
       ``(6) Corrective compliance plan.--
       ``(A) In general.--
       ``(i) Notification of violation.--Before imposing a penalty 
     against a State under this subsection with respect to a 
     violation of this part, the Secretary shall notify the State 
     of the violation and allow the State the opportunity to enter 
     into a corrective compliance plan in accordance with this 
     paragraph which outlines how the State will correct the 
     violation and how the State will insure continuing compliance 
     with this part.
       ``(ii) 60-day period to propose a corrective compliance 
     plan.--During the 60-day period that begins on the date the 
     State receives a notice provided under clause (i) with 
     respect to a violation, the State may submit to the Federal 
     Government a corrective compliance plan to correct the 
     violation.
       ``(iii) Consultation about modifications.--During the 60-
     day period that begins with the date the Secretary receives a 
     corrective compliance plan submitted by a State in accordance 
     with clause (ii), the Secretary may consult with the State on 
     modifications to the plan.
       ``(iv) Acceptance of plan.--A corrective compliance plan 
     submitted by a State in accordance with clause (ii) is deemed 
     to be accepted by the Secretary if the Secretary does not 
     accept or reject the plan during the 60-day period that 
     begins on the date the plan is submitted.
       ``(B) Effect of correcting violation.--The Secretary may 
     not impose any penalty under this subsection with respect to 
     any violation covered by a State corrective compliance plan 
     accepted by the Secretary if the State corrects the violation 
     pursuant to the plan.
       ``(C) Effect of failing to correct violation.--The 
     Secretary shall assess some or all of a penalty imposed on a 
     State under this subsection with respect to a violation if 
     the State does not, in a timely manner, correct the violation 
     pursuant to a State corrective compliance plan accepted by 
     the Secretary.
       ``(7) Limitation on amount of penalty.--
       ``(A) In general.--In imposing the penalties described in 
     this subsection, the Secretary shall not reduce any quarterly 
     payment to a State by more than 25 percent.
       ``(B) Carryforward of unrecovered penalties.--To the extent 
     that subparagraph (A) prevents the Secretary from recovering 
     during a fiscal year the full amount of all penalties imposed 
     on a State under this subsection for a prior fiscal year, the 
     Secretary shall apply any remaining amount of such penalties 
     to the grant payable to the State

[[Page H7892]]

     under subsection (a) for the immediately succeeding fiscal 
     year.
       ``(f) Treatment of Territories.--
       ``(1) In general.--A territory, as defined in section 
     1108(b)(1), shall carry out a child protection program in 
     accordance with the provisions of this part.
       ``(2) Payments.--Subject to the mandatory ceiling amounts 
     specified in section 1108, each territory, as so defined, 
     shall be entitled to receive from the Secretary for any 
     fiscal year an amount equal to the total obligations to the 
     territory under section 434 (as in effect on the day before 
     the date of the enactment of this part) for fiscal year 1995.
       ``(g) Limitation on Federal Authority.--Except as expressly 
     provided in this Act, the Secretary may not regulate the 
     conduct of States under this part or enforce any provision of 
     this part.

     ``SEC. 424. DATA COLLECTION AND REPORTING.

       ``(a) National Child Abuse and Neglect Data System.--The 
     Secretary shall establish a national data collection and 
     analysis program--
       ``(1) which, to the extent practicable, coordinates 
     existing State child abuse and neglect reports and which 
     shall include--
       ``(A) standardized data on substantiated, as well as false, 
     unfounded, or unsubstantiated reports; and
       ``(B) information on the number of deaths due to child 
     abuse and neglect; and
       ``(2) which shall collect, compile, analyze, and make 
     available State child abuse and neglect reporting information 
     which, to the extent practical, is universal and case-
     specific and integrated with other case-based foster care and 
     adoption data collected by the Secretary.
       ``(b) Adoption and Foster Care and Analysis and Reporting 
     Systems.--The Secretary shall implement a system for the 
     collection of data relating to adoption and foster care in 
     the United States. Such data collection system shall--
       ``(1) avoid unnecessary diversion of resources from 
     agencies responsible for adoption and foster care;
       ``(2) assure that any data that is collected is reliable 
     and consistent over time and among jurisdictions through the 
     use of uniform definitions and methodologies;
       ``(3) provide comprehensive national information with 
     respect to--
       ``(A) the demographic characteristics of adoptive and 
     foster children and their biological and adoptive or foster 
     parents;
       ``(B) the status of the foster care population (including 
     the number of children in foster care, length of placement, 
     type of placement, availability for adoption, and goals for 
     ending or continuing foster care);
       ``(C) the number and characteristics of--
       ``(i) children placed in or removed from foster care;
       ``(ii) children adopted or with respect to whom adoptions 
     have been terminated; and
       ``(iii) children placed in foster care outside the State 
     which has placement and care responsibility; and
       ``(D) the extent and nature of assistance provided by 
     Federal, State, and local adoption and foster care programs 
     and the characteristics of the children with respect to whom 
     such assistance is provided; and
       ``(4) utilize appropriate requirements and incentives to 
     ensure that the system functions reliably throughout the 
     United States.
       ``(c) Additional Information.--The Secretary may require 
     the provision of additional information under the data 
     collection system established under subsection (b) if the 
     addition of such information is agreed to by a majority of 
     the States.
       ``(d) Annual Report by the Secretary.--Not later than 6 
     months after the end of each fiscal year, the Secretary shall 
     prepare a report based on information provided by the States 
     for the fiscal year pursuant to this section, and shall make 
     the report and such information available to the Congress and 
     the public.

     ``SEC. 425. FUNDING FOR STUDIES OF CHILD WELFARE.

       ``(a) National Random Sample Study of Child Welfare.--There 
     are authorized to be appropriated and there are appropriated 
     to the Secretary for each of fiscal years 1996 through 2002--
       ``(1) $6,000,000 to conduct a national study based on 
     random samples of children who are at risk of child abuse or 
     neglect, or are determined by States to have been abused or 
     neglected under section 208 of the Child and Family Services 
     Block Grant Act of 1996; and
       ``(2) $10,000,000 for such other research as may be 
     necessary under such section.
       ``(b) Assessment of State Courts Improvement of Handling of 
     Proceedings Relating to Foster Care and Adoption.--There are 
     authorized to be appropriated and there are appropriated to 
     the Secretary for each of fiscal years 1996 through 1998 
     $10,000,000 for the purpose of carrying out section 13712 of 
     the Omnibus Budget Reconciliation Act of 1993 (42 U.S.C. 670 
     note). All funds appropriated under this subsection shall be 
     expended not later than September 30, 1999.

     ``SEC. 426. DEFINITIONS.

       ``For purposes of this part and part E, the following 
     definitions shall apply:
       ``(1) Administrative review.--The term `administrative 
     review' means a review open to the participation of the 
     parents of the child, conducted by a panel of appropriate 
     persons at least one of whom is not responsible for the case 
     management of, or the delivery of services to, either the 
     child or the parents who are the subject of the review.
       ``(2) Adoption assistance agreement.--The term `adoption 
     assistance agreement' means a written agreement, binding on 
     the parties to the agreement, between the State, other 
     relevant agencies, and the prospective adoptive parents of a 
     minor child which at a minimum--
       ``(A) specifies the nature and amount of any payments, 
     services, and assistance to be provided under such agreement; 
     and
       ``(B) stipulates that the agreement shall remain in effect 
     regardless of the State of which the adoptive parents are 
     residents at any given time.

     The agreement shall contain provisions for the protection 
     (under an interstate compact approved by the Secretary or 
     otherwise) of the interests of the child in cases where the 
     adoptive parents and child move to another State while the 
     agreement is effective.
       ``(3) Case plan.--The term `case plan' means a written 
     document which includes at least the following:
       ``(A) A description of the type of home or institution in 
     which a child is to be placed, including a discussion of the 
     appropriateness of the placement and how the agency which is 
     responsible for the child plans to carry out the voluntary 
     placement agreement entered into or judicial determination 
     made with respect to the child in accordance with section 
     472(a)(1).
       ``(B) A plan for assuring that the child receives proper 
     care and that services are provided to the parents, child, 
     and foster parents in order to improve the conditions in the 
     parents' home, facilitate return of the child to his or her 
     own home or the permanent placement of the child, and address 
     the needs of the child while in foster care, including a 
     discussion of the appropriateness of the services that have 
     been provided to the child under the plan.
       ``(C) To the extent available and accessible, the health 
     and education records of the child, including--
       ``(i) the names and addresses of the child's health and 
     educational providers;
       ``(ii) the child's grade level performance;
       ``(iii) the child's school record;
       ``(iv) assurances that the child's placement in foster care 
     takes into account proximity to the school in which the child 
     is enrolled at the time of placement;
       ``(v) a record of the child's immunizations;
       ``(vi) the child's known medical problems;
       ``(vii) the child's medications; and
       ``(viii) any other relevant health and education 
     information concerning the child determined to be appropriate 
     by the State.

     Where appropriate, for a child age 16 or over, the case plan 
     must also include a written description of the programs and 
     services which will help such child prepare for the 
     transition from foster care to independent living.
       ``(4) Case review system.--The term `case review system' 
     means a procedure for assuring that--
       ``(A) each child has a case plan designed to achieve 
     placement in the least restrictive (most family-like) and 
     most appropriate setting available and in close proximity to 
     the parents' home, consistent with the best interests and 
     special needs of the child, which--
       ``(i) if the child has been placed in a foster family home 
     or child-care institution a substantial distance from the 
     home of the parents of the child, or in a State different 
     from the State in which such home is located, sets forth the 
     reasons why such placement is in the best interests of the 
     child; and
       ``(ii) if the child has been placed in foster care outside 
     the State in which the home of the parents of the child is 
     located, requires that, periodically, but not less frequently 
     than every 12 months, a caseworker on the staff of the State 
     in which the home of the parents of the child is located, 
     or of the State in which the child has been placed, visit 
     such child in such home or institution and submit a report 
     on such visit to the State in which the home of the 
     parents of the child is located;
       ``(B) the status of each child is reviewed periodically but 
     no less frequently than once every 6 months by either a court 
     or by administrative review (as defined in paragraph (1)) in 
     order to determine the continuing necessity for and 
     appropriateness of the placement, the extent of compliance 
     with the case plan, and the extent of progress which has been 
     made toward alleviating or mitigating the causes 
     necessitating placement in foster care, and to project a 
     likely date by which the child may be returned to the home or 
     placed for adoption or legal guardianship;
       ``(C) with respect to each such child, procedural 
     safeguards will be applied, among other things, to assure 
     each child in foster care under the supervision of the State 
     of a dispositional hearing to be held, in a family or 
     juvenile court or another court (including a tribal court) of 
     competent jurisdiction, or by an administrative body 
     appointed or approved by the court, no later than 18 months 
     after the original placement (and not less frequently than 
     every 12 months thereafter during the continuation of foster 
     care), which hearing shall determine the future status of the 
     child (including whether the child should be returned to the 
     parent, should be continued in foster care for a specified 
     period, should be placed for adoption, or should (because of 
     the child's special needs or circumstances) be continued in 
     foster care on a permanent or long-term basis) and, in the 
     case of a child described in subparagraph (A)(ii), whether 
     the out-of-State placement continues to be appropriate and in 
     the best

[[Page H7893]]

     interests of the child, and, in the case of a child who has 
     attained age 16, the services needed to assist the child to 
     make the transition from foster care to independent living; 
     and procedural safeguards shall also be applied with respect 
     to parental rights pertaining to the removal of the child 
     from the home of his parents, to a change in the child's 
     placement, and to any determination affecting visitation 
     privileges of parents; and
       ``(D) a child's health and education record (as described 
     in paragraph (3)(C)) is reviewed and updated, and supplied to 
     the foster parent or foster care provider with whom the child 
     is placed, at the time of each placement of the child in 
     foster care.
       ``(5) Child-care institution.--The term `child-care 
     institution' means a private child-care institution, or a 
     public child-care institution which accommodates no more than 
     25 children, which is licensed by the State in which it is 
     situated or has been approved, by the agency of such State 
     responsible for licensing or approval of institutions of this 
     type, as meeting the standards established for such 
     licensing, but the term shall not include detention 
     facilities, forestry camps, training schools, or any other 
     facility operated primarily for the detention of children who 
     are determined to be delinquent.
       ``(6) Foster care maintenance payments.--
       ``(A) In general.--The term `foster care maintenance 
     payments' means payments to cover the cost of (and the cost 
     of providing) food, clothing, shelter, daily supervision, 
     school supplies, a child's personal incidentals, liability 
     insurance with respect to a child, and reasonable travel to 
     the child's home for visitation. In the case of institutional 
     care, such term shall include the reasonable costs of 
     administration and operation of such institution as are 
     necessarily required to provide the items described in the 
     preceding sentence.
       ``(B) Special rule.--In cases where--
       ``(i) a child placed in a foster family home or child-care 
     institution is the parent of a son or daughter who is in the 
     same home or institution; and
       ``(ii) payments described in subparagraph (A) are being 
     made under this part with respect to such child,

     the foster care maintenance payments made with respect to 
     such child as otherwise determined under subparagraph (A) 
     shall also include such amounts as may be necessary to cover 
     the cost of the items described in that subparagraph with 
     respect to such son or daughter.
       ``(7) Foster family home.--The term `foster family home' 
     means a foster family home for children which is licensed by 
     the State in which it is situated or has been approved, by 
     the agency of such State having responsibility for licensing 
     homes of this type, as meeting the standards established for 
     such licensing.
       ``(8) Parents.--The term `parents' means biological or 
     adoptive parents or legal guardians, as determined by 
     applicable State law.
       ``(9) State.--The term `State' means the 50 States and the 
     District of Columbia.
       ``(10) Voluntary placement.--The term `voluntary placement' 
     means an out-of-home placement of a minor, by or with 
     participation of the State, after the parents or guardians of 
     the minor have requested the assistance of the State and 
     signed a voluntary placement agreement.
       ``(11) Voluntary placement agreement.--The term `voluntary 
     placement agreement' means a written agreement, binding on 
     the parties to the agreement, between the State, any other 
     agency acting on its behalf, and the parents or guardians of 
     a minor child which specifies, at a minimum, the legal status 
     of the child and the rights and obligations of the parents or 
     guardians, the child, and the agency while the child is in 
     placement.''.

     SEC. 4702. CONFORMING AMENDMENTS.

       (a) Amendments to Part D of Title IV of the Social Security 
     Act.--
       (1) Section 452(a)(10)(C) of the Social Security Act (42 
     U.S.C. 652(a)(10)(C)), as amended by section 4108(b)(2) of 
     this Act, is amended by striking ``or under section 
     471(a)(17),''.
       (2) Section 452(g)(2)(A) of such Act (42 U.S.C. 
     652(g)(2)(A)), as amended by paragraphs (6) and (7) of 
     section 4108(b) of this Act, is amended by inserting ``or 
     benefits or services for foster care maintenance were being 
     provided under the State program funded under part E'' after 
     ``part A'' each place it appears.
       (3) Section 466(a)(3)(B) of such Act (42 U.S.C. 
     666(a)(3)(B)), as amended by section 4108(b)(14) of this Act, 
     is amended by striking ``or 471(a)(17)''.
       (b) Amendment to Section 9442 of the Omnibus Budget 
     Reconciliation Act of 1986.--Section 9442(4) of the Omnibus 
     Budget Reconciliation Act of 1986 (42 U.S.C. 679a(4)) is 
     amended by inserting ``(as in effect before October 1, 
     1995)'' after ``Act''.
       (c) Redesignation and Amendments of Section 1123.--
       (1) Redesignation.--The Social Security Act is amended by 
     redesignating section 1123, the second place it appears (42 
     U.S.C. 1320a-1a), as section 1123A.
       (2) Amendments.--Section 1123A of such Act, as so 
     redesignated, is amended in subsection (a)--
       (A) by striking ``The Secretary'' and inserting 
     ``Notwithstanding section 423(g), the Secretary''; and
       (B) in paragraph (2), by inserting ``under this section'' 
     after ``promulgated''.

Subchapter B--Foster Care, Adoption Assistance, and Independent Living 
                                Programs

     SEC. 4711. CONFORMING AMENDMENTS TO PART E OF TITLE IV.

       (a) Purpose; Appropriation.--Section 470 of the Social 
     Security Act (42 U.S.C 670) is amended--
       (1) by amending the heading to read as follows:

     ``SEC. 470. PURPOSE; APPROPRIATION.''; and

       (2) in the second sentence, by striking ``this part'' and 
     inserting ``section 422''.
       (b) State Plan For Foster Care and Adoption Assistance.--
     Section 471 of such Act (42 U.S.C. 671) is amended to read as 
     follows:

     ``SEC. 471. ELIGIBLE STATES.

       ``In order for a State to be eligible for payments under 
     this part, the State shall have submitted to the Secretary a 
     plan which satisfies the requirements of section 422.''.
       (c) Foster Care Maintenance Payments Program.--Section 472 
     of such Act (42 U.S.C. 672) is amended to read as follows:

     ``SEC. 472. REQUIREMENTS FOR FOSTER CARE MAINTENANCE 
                   PAYMENTS.

       ``(a) In General.--Each State operating a program under 
     this part shall make foster care maintenance payments, as 
     defined in section 426(6) with respect to a child who would 
     meet the requirements of section 406(a) (as in effect on the 
     day before the date of the enactment of the Personal 
     Responsibility and Work Opportunity Act of 1996) or of 
     section 407 (as so in effect) but for the removal of the 
     child from the home of a relative (specified in section 
     406(a) (as so in effect)), if--
       ``(1) the removal from the home occurred pursuant to a 
     voluntary placement agreement entered into by the child's 
     parent or legal guardian, or was the result of a judicial 
     determination to the effect that continuation therein would 
     be contrary to the welfare of such child and that reasonable 
     efforts of the type described in section 422(a)(12) have been 
     made;
       ``(2) such child's placement and care are the 
     responsibility of--
       ``(A) the State; or
       ``(B) any other public agency with which the State has made 
     an agreement for the administration of the State program 
     under this part which is still in effect;
       ``(3) such child has been placed in a foster family home or 
     child-care institution as a result of the voluntary placement 
     agreement or judicial determination referred to in paragraph 
     (1); and
       ``(4) such child--
       ``(A) would have been eligible to receive aid under the 
     eligibility standards under the State plan approved under 
     section 402 (as in effect on the day before the date of the 
     enactment of this part and adjusted for inflation, in 
     accordance with regulations issued by the Secretary) in or 
     for the month in which such agreement was entered into or 
     court proceedings leading to the removal of such child from 
     the home were initiated; or
       ``(B) would have received such aid in or for such month if 
     application had been made therefor, or the child had been 
     living with a relative specified in section 406(a) (as so in 
     effect) within 6 months prior to the month in which such 
     agreement was entered into or such proceedings were 
     initiated, and would have received such aid in or for such 
     month if in such month such child had been living with such a 
     relative and application therefor had been made.
       ``(b) Limitation on Foster Care Payments.--Foster care 
     maintenance payments may be made under this part only on 
     behalf of a child described in subsection (a) of this section 
     who is--
       ``(1) in the foster family home of an individual, whether 
     the payments therefore are made to such individual or to a 
     public or private child placement or child-care agency; or
       ``(2) in a child-care institution, whether the payments 
     therefore are made to such institution or to a public or 
     private child-placement or child-care agency, which payments 
     shall be limited so as to include in such payments only those 
     items which are included in the term `foster care maintenance 
     payments' (as defined in section 426(6)).
       ``(c) Voluntary Placements.--
       ``(1) Satisfaction of child protection standards.--
     Notwithstanding any other provision of this section, Federal 
     payments may be made under this part with respect to amounts 
     expended by any State as foster care maintenance payments 
     under this part, in the case of children removed from their 
     homes pursuant to voluntary placement agreements as described 
     in subsection (a), only if (at the time such amounts were 
     expended) the State has fulfilled all of the requirements of 
     section 422(a)(11).
       ``(2) Removal in excess of 180 days.--No Federal payment 
     may be made under this part with respect to amounts expended 
     by any State as foster care maintenance payments, in the case 
     of any child who was removed from such child's home pursuant 
     to a voluntary placement agreement as described in subsection 
     (a) and has remained in voluntary placement for a period in 
     excess of 180 days, unless there has been a judicial 
     determination by a court of competent jurisdiction (within 
     the first 180 days of such placement) that such placement is 
     in the best interests of the child.
       ``(3) Deemed revocation of agreements.--In any case where--
       ``(A) the placement of a minor child in foster care 
     occurred pursuant to a voluntary placement agreement entered 
     into by the

[[Page H7894]]

     parents or guardians of such child as provided in subsection 
     (a); and
       ``(B) such parents or guardians request (in such manner and 
     form as the Secretary may prescribe) that the child be 
     returned to their home or to the home of a relative,
     the voluntary placement agreement shall be deemed to be 
     revoked unless the State opposes such request and obtains a 
     judicial determination, by a court of competent jurisdiction, 
     that the return of the child to such home would be contrary 
     to the child's best interests.
       ``(d) Eligibility for Medical Assistance.--For purposes of 
     titles XIX and XX, any child with respect to whom foster care 
     maintenance payments are made under this section is deemed to 
     be a recipient of cash assistance under part A of this title. 
     For the purposes of the preceding sentence, a child whose 
     costs in a foster family home or child-care institution are 
     covered by the foster care maintenance payments being made 
     with respect to his or her minor parent, as provided in 
     section 426(6)(B), shall be considered a child with respect 
     to whom foster care maintenance payments are made under this 
     section.''.
       (d) Adoption Assistance Program.--Section 473 of such Act 
     (42 U.S.C. 673) is amended to read as follows:

     ``SEC. 473. REQUIREMENTS FOR ADOPTION ASSISTANCE PAYMENTS.

       ``(a) In General.--A State operating a program under this 
     part shall enter into adoption assistance agreements with the 
     adoptive parents of children with special needs.
       ``(b) Payments Under Agreements.--
       ``(1) In general.--Under any adoption assistance agreement 
     entered into by a State with parents who adopt a child with 
     special needs, the State--
       ``(A) shall make payments of nonrecurring adoption expenses 
     incurred by or on behalf of such parents in connection with 
     the adoption of such child, directly through the State agency 
     or through another public or nonprofit private agency, in 
     amounts determined under subsection (e), and
       ``(B) in any case where the child meets the requirements of 
     subsection (d), may make adoption assistance payments to such 
     parents, directly through the State agency or through another 
     public or nonprofit private agency, in amounts so 
     determined.
       ``(2) Definition of nonrecurring adoption expenses.--
       ``(A) In general.--For purposes of paragraph (1)(A), the 
     term `nonrecurring adoption expenses' means reasonable and 
     necessary adoption fees, court costs, attorney fees, and 
     other expenses which are directly related to the legal 
     adoption of a child with special needs and which are not 
     incurred in violation of State or Federal law.
       ``(B) Treatment as an administrative expense.--A State's 
     payment of nonrecurring adoption expenses under an adoption 
     assistance agreement shall be treated as an expenditure made 
     for the proper and efficient administration of the State plan 
     for purposes of section 474(a)(3)(E).
       ``(c) Eligibility for Medical Assistance.--For purposes of 
     titles XIX and XX, any child--
       ``(1)(A) who is a child described in subsection (b), and
       ``(B) with respect to whom an adoption assistance agreement 
     is in effect under this section (whether or not adoption 
     assistance payments are provided under the agreement or are 
     being made under this section), including any such child who 
     has been placed for adoption in accordance with applicable 
     State and local law (whether or not an interlocutory or other 
     judicial decree of adoption has been issued), or
       ``(2) with respect to whom foster care maintenance payments 
     are being made under section 472,
     is deemed to be a recipient of cash assistance under part A 
     of this title in the State where such child resides. For 
     purposes of the preceding sentence, a child whose costs in a 
     foster family home or child-care institution are covered by 
     the foster care maintenance payments being made with respect 
     to his or her minor parent, as provided in section 426(6)(B), 
     shall be considered a child with respect to whom foster care 
     maintenance payments are being made under section 472.
       ``(d) Children With Special Needs.--For purposes of 
     subsection (b)(1)(B), a child meets the requirements of this 
     subsection if such child--
       ``(1)(A) at the time adoption proceedings were initiated, 
     met the requirements of section 406(a) (as in effect on the 
     day before the date of the enactment of the Personal 
     Responsibility and Work Opportunity Act of 1996) or section 
     407 (as so in effect) or would have met such requirements 
     except for such child's removal from the home of a relative 
     (specified in section 406(a) (as so in effect)), either 
     pursuant to a voluntary placement agreement with respect to 
     which Federal payments are provided under section 474 (or 403 
     (as so in effect)) or as a result of a judicial determination 
     to the effect that continuation therein would be contrary to 
     the welfare of such child;
       ``(B) meets all of the requirements of title XVI with 
     respect to eligibility for supplemental security income 
     benefits; or
       ``(C) is a child whose costs in a foster family home or 
     child-care institution are covered by the foster care 
     maintenance payments being made with respect to his or her 
     minor parent;
       ``(2)(A) would have received aid under the eligibility 
     standards under the State plan approved under section 402 (as 
     in effect on the day before the date of the enactment of this 
     part, adjusted for inflation, in accordance with regulations 
     issued by the Secretary) in or for the month in which such 
     agreement was entered into or court proceedings leading to 
     the removal of such child from the home were initiated;
       ``(B) would have received such aid in or for such month if 
     application had been made therefor, or had been living with a 
     relative specified in section 406(a) (as so in effect) within 
     6 months prior to the month in which such agreement was 
     entered into or such proceedings were initiated, and would 
     have received such aid in or for such month if in such month 
     such child had been living with such a relative and 
     application therefor had been made; or
       ``(C) is a child described in subparagraph (A) or (B); and
       ``(3) has been determined by the State, pursuant to 
     subsection (h) of this section, to be a child with special 
     needs.
       ``(e) Determination of Payments.--The amount of the 
     payments to be made in any case under subsection (b) shall be 
     determined through agreement between the adoptive parents and 
     the State or a public or nonprofit private agency 
     administering the program under this part, which shall take 
     into consideration the circumstances of the adopting parents 
     and the needs of the child being adopted, and may be 
     readjusted periodically, with the concurrence of the adopting 
     parents (which may be specified in the adoption assistance 
     agreement), depending upon changes in such circumstances. 
     However, in no case may the amount of the adoption assistance 
     payment exceed the foster care maintenance payment which 
     would have been paid during the period if the child with 
     respect to whom the adoption assistance payment is made had 
     been in a foster family home.
       ``(f) Payment Exception.--Notwithstanding subsection (e), 
     no payment may be made to parents with respect to any child 
     who has attained the age of 18 (or, where the State 
     determines that the child has a mental or physical disability 
     which warrants the continuation of assistance, the age of 
     21), and no payment may be made to parents with respect to 
     any child if the State determines that the parents are no 
     longer legally responsible for the support of the child or if 
     the State determines that the child is no longer receiving 
     any support from such parents. Parents who have been 
     receiving adoption assistance payments under this part shall 
     keep the State or public or nonprofit private agency 
     administering the program under this part informed of 
     circumstances which would, pursuant to this section, make 
     them ineligible for such assistance payments, or eligible for 
     assistance payments in a different amount.
       ``(g) Preadoption Payments.--For purposes of this part, 
     individuals with whom a child who has been determined by the 
     State, pursuant to subsection (h), to be a child with special 
     needs is placed for adoption in accordance with applicable 
     State and local law shall be eligible for adoption assistance 
     payments during the period of the placement, on the same 
     terms and subject to the same conditions as if such 
     individuals had adopted such child.
       ``(h) Determination of Child With Special Needs.--For 
     purposes of this section, a child shall not be considered a 
     child with special needs unless--
       ``(1) the State has determined that the child cannot or 
     should not be returned to the home of the child's parents; 
     and
       ``(2) the State had first determined--
       ``(A) that there exists with respect to the child a 
     specific factor or condition such as the child's ethnic 
     background, age, or membership in a minority or sibling 
     group, or the presence of factors such as medical conditions 
     or physical, mental, or emotional handicaps because of which 
     it is reasonable to conclude that such child cannot be placed 
     with adoptive parents without providing adoption assistance 
     under this part or medical assistance under title XIX; and
       ``(B) that, except where it would be against the best 
     interests of the child because of such factors as the 
     existence of significant emotional ties with prospective 
     adoptive parents while in the care of such parents as a 
     foster child, a reasonable, but unsuccessful, effort has been 
     made to place the child with appropriate adoptive parents 
     without providing adoption assistance under this section or 
     medical assistance under title XIX.''.
       (e) Payments to States; Allotments to States.--Section 474 
     of such Act (42 U.S.C. 674) is amended to read as follows:

     ``SEC. 474. PAYMENTS TO STATES; ALLOTMENTS TO STATES.

       ``(a) Foster Care, Adoption Assistance, and Independent 
     Living Programs Payments.--Each eligible State, as determined 
     under section 471, shall be entitled to receive from the 
     Secretary for each quarter of each fiscal year a payment 
     equal to the sum of--
       ``(1) an amount equal to the Federal medical assistance 
     percentage (as defined in section 1905(b) of this Act as in 
     effect on the day before the date of the enactment of the 
     Personal Responsibility and Work Opportunity Act of 1996) of 
     the total amount expended during such quarter as foster care 
     maintenance payments under the child protection program under 
     this part for children in foster family homes or child-care 
     institutions; plus
       ``(2) an amount equal to the Federal medical assistance 
     percentage (as defined in section 1905(b) of this Act (as so 
     in effect)) of the total amount expended during such quarter 
     as adoption assistance payments under

[[Page H7895]]

     the child protection program under this part pursuant to 
     adoption assistance agreements; plus
       ``(3) an amount equal to the sum of the following 
     proportions of the total amounts expended during such quarter 
     as found necessary by the Secretary for the provision of 
     child placement services and for the proper and efficient 
     administration of the State foster care and adoption 
     assistance program--
       ``(A) 75 percent of so much of such expenditures as are for 
     the training (including both short and long-term training at 
     educational institutions through grants to such institutions 
     or by direct financial assistance to students enrolled in 
     such institutions) of personnel employed or preparing for 
     employment by the State agency or by the local agency 
     administering the plan in the political subdivision;
       ``(B) 75 percent of so much of such expenditures (including 
     travel and per diem expenses) as are for the short-term 
     training of current or prospective foster or adoptive parents 
     and the members of the staff of State-licensed or State-
     approved child care institutions providing care to foster and 
     adopted children receiving assistance under this part, in 
     ways that increase the ability of such current or prospective 
     parents, staff members, and institutions to provide support 
     and assistance to foster and adopted children, whether 
     incurred directly by the State or by contract;
       ``(C) 50 percent (or, if the quarter is in fiscal year 
     1997, 75 percent) of so much of such expenditures as are for 
     the planning, design, development, or installation of 
     statewide mechanized data collection and information 
     retrieval systems (including 50 percent (or, if the quarter 
     is in fiscal year 1997, 75 percent) of the full amount of 
     expenditures for hardware components for such systems) but 
     only to the extent that such systems--
       ``(i) meet the requirements imposed by regulations;
       ``(ii) to the extent practicable, are capable of 
     interfacing with the State data collection system that 
     collects information relating to child abuse and neglect;
       ``(iii) to the extent practicable, have the capability of 
     interfacing with, and retrieving information from, the State 
     data collection system that collects information relating to 
     the eligibility of individuals under part A (for the purposes 
     of facilitating verification of eligibility of foster 
     children); and
       ``(iv) are determined by the Secretary to be likely to 
     provide more efficient, economical, and effective 
     administration of the programs carried out under a State plan 
     approved under this part;
       ``(D) 50 percent of so much of such expenditures as are for 
     the operation of the statewide mechanized data collection and 
     information retrieval systems referred to in subparagraph 
     (C); and
       ``(E) one-half of the remainder of such expenditures; plus
       ``(4) an amount equal to the sum of--
       ``(A) so much of the amounts expended by such State to 
     carry out a program under section 476, as do not exceed the 
     basic amount for such State determined under subsection 
     (e)(1) of such section; and
       ``(B) the lesser of--
       ``(i) one-half of any additional amounts expended by such 
     State for such programs; or
       ``(ii) the maximum additional amount for such State under 
     subsection (e)(1) of such section.
       ``(b) Automated Data Collection Expenditures.--The 
     Secretary shall treat as necessary for the proper and 
     efficient administration of the State plan all expenditures 
     of a State necessary in order for the State to plan, design, 
     develop, install, and operate data collection and information 
     retrieval systems, without regard to whether the systems may 
     be used with respect to foster or adoptive children other 
     than those on behalf of whom foster care maintenance payments 
     or adoption assistance payments may be made under this part.
       ``(c) Estimates by the Secretary.--
       ``(1) In general.--The Secretary shall, prior to the 
     beginning of each quarter, estimate the amount which a State 
     will be entitled to receive under subsection (a) for such 
     quarter, such estimates to be based on--
       ``(A) a report filed by the State containing its estimate 
     of the total sum to be expended in such quarter in accordance 
     with subsection (a), and stating the amount appropriated or 
     made available by the State and its political subdivisions 
     for such expenditures in such quarter, and if such amount is 
     less than the State's proportionate share of the total sum of 
     such estimated expenditures, the source or sources from which 
     the difference is expected to be derived;
       ``(B) records showing the number of children in the State 
     receiving assistance under this part; and
       ``(C) such other information as the Secretary may find 
     necessary.
       ``(2) Payments.--The Secretary shall pay to the States the 
     amounts so estimated under paragraph (1), reduced or 
     increased to the extent of any overpayment or underpayment 
     which the Secretary determines was made under this subsection 
     to such State for any prior quarter and with respect to which 
     adjustment has not already been made under this subsection.
       ``(3) Pro rata share.-- The pro rata share to which the 
     United States is equitably entitled, as determined by the 
     Secretary, of the net amount recovered during any quarter by 
     the State or any political subdivision thereof with respect 
     to foster care and adoption assistance furnished under this 
     part shall be considered an overpayment to be adjusted under 
     this subsection.
       ``(d) Allowance or Disallowance of Claim.--
       ``(1) In general.--Within 60 days after receipt of a State 
     claim for expenditures pursuant to subsection (b)(1), the 
     Secretary shall allow, disallow, or defer such claim.
       ``(2) Notice.--Within 15 days after a decision to defer a 
     State claim, the Secretary shall notify the State of the 
     reasons for the deferral and of the additional information 
     necessary to determine the allowability of the claim.
       ``(3) Decision.--Within 90 days after receiving such 
     necessary information (in readily reviewable form), the 
     Secretary shall--
       ``(A) disallow the claim, if able to complete the review 
     and determine that the claim is not allowable; or
       ``(B) in any other case, allow the claim, subject to 
     disallowance (as necessary)--
       ``(i) upon completion of the review, if it is determined 
     that the claim is not allowable; or
       ``(ii) on the basis of findings of an audit or financial 
     management review.''.
       (f) Definitions.--Section 475 of such Act (42 U.S.C. 675) 
     is amended to read as follows:

     ``SEC. 475. DEFINITIONS.

       For definitions of terms used in this part, see section 
     426.''.
       (g) Technical Assistance; Data Collection and Evaluation.--
     Part E of title IV of such Act is amended by striking section 
     476.
       (h) Independent Living Initiatives.--Part E of title IV of 
     such Act (42 U.S.C. 670 et seq.), as amended by subsection 
     (g) of this section, is amended--
       (1) by redesignating section 477 as section 476; and
       (2) by amending section 476, as so redesignated, to read as 
     follows:

     ``SEC. 476. REQUIREMENTS FOR INDEPENDENT LIVING PROGRAMS.

       ``(a) Payments for Independent Living Programs.--
       ``(1) In general.--Payments shall be made in accordance 
     with this section for the purpose of assisting States and 
     localities in establishing and carrying out programs designed 
     to assist children described in paragraph (2) who have 
     attained age 16 in making the transition from foster care to 
     independent living. Any State which provides for the 
     establishment and carrying out of one or more such programs 
     in accordance with this section for a fiscal year shall be 
     entitled to receive payments under this section for such 
     fiscal year, in an amount determined under subsection (e).
       ``(2) Program requirements.--A program established and 
     carried out under paragraph (1)--
       ``(A) shall be designed to assist children with respect to 
     whom foster care maintenance payments are being made by the 
     State under this part;
       ``(B) may at the option of the State also include any or 
     all other children in foster care under the responsibility of 
     the State; and
       ``(C) may at the option of the State also include any child 
     who has not attained age 21 to whom foster care maintenance 
     payments were previously made by a State under this part and 
     whose payments were discontinued on or after the date such 
     child attained age 16, and any child who previously was in 
     foster care described in subparagraph (B) and for whom such 
     care was discontinued on or after the date such child 
     attained age 16; and a written transitional independent 
     living plan of the type described in subsection (d)(6) shall 
     be developed for such child as a part of such program.
       ``(b) Use of Funds.--Payment under this section shall be 
     made to the State, and shall be used for the purpose of 
     conducting and providing in accordance with this section 
     (directly or under contracts with local governmental entities 
     or private nonprofit organizations) the activities and 
     services required to carry out the program or programs 
     involved.
       ``(c) Submission of Program Description and Assurances.--In 
     order for a State to receive payments under this section for 
     any fiscal year, the State, prior to February 1 of such 
     fiscal year, must submit to the Secretary, in such manner and 
     form as the Secretary may prescribe, a description of the 
     program together with satisfactory assurances that the 
     program will be operated in an effective and efficient manner 
     and will otherwise meet the requirements of this section.
       ``(d) Program Objectives.--In carrying out the purpose 
     described in subsection (a), it shall be the objective of 
     each program established under this section to help the 
     individuals participating in such program to prepare to live 
     independently upon leaving foster care. Such programs may 
     include (subject to the availability of funds) programs to--
       ``(1) enable participants to seek a high school diploma or 
     its equivalent or to take part in appropriate vocational 
     training;
       ``(2) provide training in daily living skills, budgeting, 
     locating and maintaining housing, and career planning;
       ``(3) provide for individual and group counseling;
       ``(4) integrate and coordinate services otherwise available 
     to participants;
       ``(5) provide for the establishment of outreach programs 
     designed to attract individuals who are eligible to 
     participate in the program;
       ``(6) provide each participant a written transitional 
     independent living plan which

[[Page H7896]]

     shall be based on an assessment of his needs, and which shall 
     be incorporated into his case plan, as defined in section 
     426(3); and
       ``(7) provide participants with other services and 
     assistance designed to improve their transition to 
     independent living.
       ``(e) Determination of Payments.--
       ``(1) Basic amount.--
       ``(A) In general.--The basic amount to which a State shall 
     be entitled under section 474(a)(4) for a fiscal year shall 
     be an amount which bears the same ratio to the basic ceiling 
     for such fiscal year as such State's average number of 
     children receiving foster care maintenance payments under 
     part E in fiscal year 1984 bore to the total of the average 
     number of children receiving such payments under such part 
     for all States for fiscal year 1984.
       ``(B) Maximum additional amount.--The maximum additional 
     amount to which a State shall be entitled under section 
     474(a)(4) for a fiscal year shall be an amount which bears 
     the same ratio to the additional ceiling for such fiscal year 
     as the basic amount of such State bears to $45,000,000.
       ``(C) Definitions.--For purposes of this section:
       ``(i) Basic ceiling.--The term `basic ceiling' means, for 
     any fiscal year, $45,000,000.
       ``(ii) Additional ceiling.--The term `additional ceiling' 
     means, for any fiscal year, $25,000,000.
       ``(2) Reallocation of funds.--If any State does not apply 
     for funds under this section for any fiscal year within the 
     time provided in subsection (c), the funds to which such 
     State would have been entitled for such fiscal year shall be 
     reallocated to one or more other States on the basis of their 
     relative need for additional payments under this section (as 
     determined by the Secretary).
       ``(3) Supplement to other funds.--Any amounts payable to 
     States under this section shall be in addition to amounts 
     payable to States under paragraphs (1), (2), and (3) of 
     section 474(a), and shall supplement and not replace any 
     other funds which may be available for the same general 
     purposes in the localities involved.
       ``(f) Limitation on Use of Funds.--Payments made to a State 
     under this section for any fiscal year--
       ``(1) shall be used only for the specific purposes 
     described in this section;
       ``(2) may not be used for the provision of room or board;
       ``(3) may be made on an estimated basis in advance of the 
     determination of the exact amount, with appropriate 
     subsequent adjustments to take account of any error in the 
     estimates; and
       ``(4) shall be expended by such State in such fiscal year 
     or in the succeeding fiscal year.
       ``(g) Reporting Requirements.--Not later than the first 
     January 1 following the end of each fiscal year, each State 
     shall submit to the Secretary a report on the programs 
     carried out during such fiscal year with the amounts received 
     under this section. Such report shall be in such form and 
     contain such information as may be necessary to provide an 
     accurate description of such activities, to provide a 
     complete record of the purposes for which the funds were 
     spent, and to indicate the extent to which the expenditure 
     of such funds succeeded in accomplishing the purpose 
     described in subsection (a).
       ``(h) Assistance Not Considered Income or Resources.--
     Notwithstanding any other provision of this title, payments 
     made and services provided to participants in a program under 
     this section, as a direct consequence of their participation 
     in such program, shall not be considered as income or 
     resources for purposes of determining eligibility (or the 
     eligibility of any other persons) for assistance under the 
     State's plan approved under this part or part A, or for 
     purposes of determining the level of such assistance.''.
       (i) Collection of Data Relating to Adoption and Foster 
     Care.--Part E of title IV of such Act (42 U.S.C. 670 et seq.) 
     is amended--
       (1) by redesignating section 479 as section 477; and
       (2) by amending section 477, as so redesignated, to read as 
     follows:

     ``SEC. 477. COLLECTION OF DATA RELATING TO ADOPTION AND 
                   FOSTER CARE.

       ``For requirements with respect to the collection of data 
     relating to adoption and foster care, see section 424.''.

                      Subchapter C--Miscellaneous

     SEC. 4721. SECRETARIAL SUBMISSION OF LEGISLATIVE PROPOSAL FOR 
                   TECHNICAL AND CONFORMING AMENDMENTS.

       Not later than 90 days after the date of the enactment of 
     this chapter, the Secretary of Health and Human Services, in 
     consultation, as appropriate, with the heads of other Federal 
     agencies, shall submit to the appropriate committees of 
     Congress a legislative proposal providing for such technical 
     and conforming amendments in the law as are required by the 
     provisions of this chapter.

     SEC. 4722. SENSE OF THE CONGRESS REGARDING TIMELY ADOPTION OF 
                   CHILDREN.

       It is the sense of the Congress that--
       (1) too many children who wish to be adopted are spending 
     inordinate amounts of time in foster care;
       (2) there is an urgent need for States to increase the 
     number of waiting children being adopted in a timely and 
     lawful manner;
       (3) studies have shown that States spend an excess of 
     $15,000 each year on each special needs child in foster care, 
     and would save significant amounts of money if they offered 
     incentives to families to adopt special needs children;
       (4) States should allocate sufficient funds under this 
     subtitle for adoption assistance and medical assistance to 
     encourage more families to adopt children who otherwise would 
     languish in the foster care system for a period that many 
     experts consider detrimental to their development;
       (5) States should offer incentives for families that adopt 
     special needs children to make adoption more affordable for 
     middle-class families;
       (6) when it is necessary for a State to remove a child from 
     the home of the child's biological parents, the State should 
     strive--
       (A) to provide the child with a single foster care 
     placement and a single coordinated case team; and
       (B) to conclude an adoption of the child, when adoption is 
     the goal of the child and the State, within one year of the 
     child's placement in foster care; and
       (7) States should participate in local, regional, or 
     national programs to enable maximum visibility of waiting 
     children to potential parents. Such programs should include a 
     nationwide, interactive computer network to disseminate 
     information on children eligible for adoption to help match 
     them with families around the country.

     SEC. 4723. REMOVAL OF BARRIERS TO INTERETHNIC ADOPTION.

       (a) State Plan Requirements.--Section 422(a) of the Social 
     Security Act (42 U.S.C 622(a)), as added by section 4701 of 
     this Act, is amended by adding at the end the following:
       ``(15) Certification regarding removal of barriers to 
     interethnic adoption.--A certification that, not later than 
     January 1, 1997, the State has in effect such laws and 
     procedures as may be necessary to ensure that neither the 
     State nor any other entity in the State that receives funds 
     from the Federal Government and is involved in adoption or 
     foster care placements may--
       ``(A) deny to any person the opportunity to become an 
     adoptive or a foster parent, on the basis of the race, color, 
     or national origin of the person, or of the child, involved; 
     or
       ``(B) delay or deny the placement of a child for adoption 
     or into foster care, on the basis of the race, color, or 
     national origin of the adoptive or foster parent, or the 
     child, involved.''.
       (b) Enforcement.--Section 423(e) of such Act (42 U.S.C. 
     623(e)), as added by section 4701 of this Act, is amended by 
     redesignating paragraphs (5), (6), and (7) as paragraphs (6), 
     (7), and (8), respectively, and by inserting after paragraph 
     (4) the following:
       ``(5) Penalty for failure to remove barriers to interethnic 
     adoption.--
       ``(A) Reduction of payments to the state.--If a State's 
     program operated under this part is found, as a result of a 
     review conducted under section 1123, to have violated section 
     422(a)(15) during a quarter with respect to any person, then, 
     notwithstanding any regulations promulgated under section 
     1123(b)(3), the Secretary shall reduce the amount otherwise 
     payable to the State under this part, for the quarter and for 
     each subsequent quarter before the 1st quarter for which the 
     State program is found, as a result of such a review, not to 
     have violated section 422(a)(15) with respect to any person, 
     by--
       ``(i) 2 percent of such otherwise payable amount, in the 
     case of the 1st such finding with respect to the State;
       ``(ii) 5 percent of such otherwise payable amount, in the 
     case of the 2nd such finding with respect to the State; or
       ``(iii) 10 percent of such otherwise payable amount, in the 
     case of the 3rd or subsequent such finding with respect to 
     the State.
       ``(B) Return of funds paid to other violators.--Any other 
     entity which is in a State that receives funds under this 
     part and which violates section 422(a)(15) during a quarter 
     with respect to any person shall remit to the Secretary all 
     funds that were paid by the State to the entity during the 
     quarter from such funds.
       ``(C) Private cause of action.--
       ``(i) In general.--Any individual who is aggrieved by a 
     violation of section 422(a)(15) by a State or other entity 
     may bring an action seeking relief from the State or other 
     entity in any United States district court.
       ``(ii) Limitation.--An action under this subparagraph may 
     not be brought more than 2 years after the date the alleged 
     violation occurred.
       ``(D) No effect on the indian child welfare act of 1978.--
     This paragraph shall not be construed to affect the 
     application of the Indian Child Welfare Act of 1978.''.
       (c) Civil Rights.--
       (1) Prohibited conduct.--A person or government that is 
     involved in adoption or foster care placements may not--
       (A) deny to any individual the opportunity to become an 
     adoptive or a foster parent, on the basis of the race, color, 
     or national origin of the individual, or of the child, 
     involved; or
       (B) delay or deny the placement of a child for adoption or 
     into foster care, on the basis of the race, color, or 
     national origin of the adoptive or foster parent, or the 
     child, involved.
       (2) Enforcement.--Noncompliance with paragraph (1) is 
     deemed a violation of title VI of the Civil Rights Act of 
     1964.
       (3) No effect on the indian child welfare act of 1978.--
     This subsection shall not be construed to affect the 
     application of the Indian Child Welfare Act of 1978.
       (d) Conforming Repeal.--Section 553 of the Howard M. 
     Metzenbaum Multiethnic

[[Page H7897]]

     Placement Act of 1994 (42 U.S.C. 5115a) is repealed.

     SEC. 4724. EFFECTIVE DATE; TRANSITION RULES.

       (a) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), this 
     chapter and the amendments made by this chapter shall be 
     effective on and after October 1, 1996.
       (2) Exception.--Section 425 of the Social Security Act, as 
     added by section 4701 of this Act, shall take effect on the 
     date of the enactment of this chapter.
       (3) Temporary redesignation of section 425.--During the 
     period beginning on the date of the enactment of this chapter 
     and ending on October 1, 1996, section 425 of the Social 
     Security Act, as added by section 4701 of this Act, is 
     redesignated as section 425A.
       (b) Transition Rules.--
       (1) Claims, actions, and proceedings.--The amendments made 
     by this chapter shall not apply with respect to--
       (A) powers, duties, functions, rights, claims, penalties, 
     or obligations applicable to aid, assistance, or services 
     provided before the effective date of this chapter under the 
     provisions amended; and
       (B) administrative actions and proceedings commenced before 
     such date, or authorized before such date to be commenced, 
     under such provisions.
       (2) Closing out account for those programs terminated or 
     substantially modified by this chapter.--In closing out 
     accounts, Federal and State officials may use scientifically 
     acceptable statistical sampling techniques. Claims made under 
     programs which are repealed or substantially amended in this 
     chapter and which involve State expenditures in cases where 
     assistance or services were provided during a prior fiscal 
     year, shall be treated as expenditures during fiscal year 
     1995 for purposes of reimbursement even if payment was made 
     by a State on or after October 1, 1995. States shall complete 
     the filing of all claims no later than September 30, 1997. 
     Federal department heads shall--
       (A) use the single audit procedure to review and resolve 
     any claims in connection with the closeout of programs; and
       (B) reimburse States for any payments made for assistance 
     or services provided during a prior fiscal year from funds 
     for fiscal year 1995, rather than the funds authorized by 
     this chapter.

            CHAPTER 2--CHILD AND FAMILY SERVICES BLOCK GRANT

     SEC. 4751. CHILD AND FAMILY SERVICES BLOCK GRANT.

       The Child Abuse Prevention and Treatment Act (42 U.S.C. 
     5101 et seq.) is amended to read as follows:

     ``SECTION 1. SHORT TITLE.

       ``This Act may be cited as the `Child and Family Services 
     Block Grant Act of 1996'.

     ``SEC. 2. FINDINGS.

       ``The Congress finds the following:
       ``(1) Each year, close to 1,000,000 American children are 
     victims of abuse and neglect.
       ``(2) Many of these children and their families fail to 
     receive adequate protection or treatment.
       ``(3) The problem of child abuse and neglect requires a 
     comprehensive approach that--
       ``(A) integrates the work of social service, legal, health, 
     mental health, education, and substance abuse agencies and 
     organizations;
       ``(B) strengthens coordination among all levels of 
     government, and with private agencies, civic, religious, and 
     professional organizations, and individual volunteers;
       ``(C) emphasizes the need for abuse and neglect prevention, 
     assessment, investigation, and treatment at the neighborhood 
     level;
       ``(D) ensures properly trained and support staff with 
     specialized knowledge, to carry out their child protection 
     duties; and
       ``(E) is sensitive to ethnic and cultural diversity.
       ``(4) The child protection system should be comprehensive, 
     child-centered, family-focused, and community-based, should 
     incorporate all appropriate measures to prevent the 
     occurrence or recurrence of child abuse and neglect, and 
     should promote physical and psychological recovery and social 
     reintegration in an environment that fosters the health, 
     safety, self-respect, and dignity of the child.
       ``(5) The Federal Government should provide leadership and 
     assist communities in their child and family protection 
     efforts by--
       ``(A) generating and sharing knowledge relevant to child 
     and family protection, including the development of models 
     for service delivery;
       ``(B) strengthening the capacity of States to assist 
     communities;
       ``(C) helping communities to carry out their child and 
     family protection plans by promoting the competence of 
     professional, paraprofessional, and volunteer resources; and
       ``(D) providing leadership to end the abuse and neglect of 
     the Nation's children and youth.

     ``SEC. 3. PURPOSES.

       ``The purposes of this Act are the following:
       ``(1) To assist each State in improving the child 
     protective service systems of such State by--
       ``(A) improving risk and safety assessment tools and 
     protocols;
       ``(B) developing, strengthening, and facilitating training 
     opportunities for individuals who are mandated to report 
     child abuse or neglect or otherwise overseeing, 
     investigating, prosecuting, or providing services to children 
     and families who are at risk of abusing or neglecting their 
     children; and
       ``(C) developing, implementing, or operating information, 
     education, training, or other programs designed to assist and 
     provide services for families of disabled infants with life-
     threatening conditions.
       ``(2) To support State efforts to develop, operate, expand 
     and enhance a network of community-based, prevention-focused, 
     family resource and support programs that are culturally 
     competent and that coordinate resources among existing 
     education, vocational rehabilitation, disability, respite, 
     health, mental health, job readiness, self-sufficiency, child 
     and family development, community action, Head Start, child 
     care, child abuse and neglect prevention, juvenile justice, 
     domestic violence prevention and intervention, housing, and 
     other human service organizations within the State.
       ``(3) To facilitate the elimination of barriers to adoption 
     and to provide permanent and loving home environments for 
     children who would benefit from adoption, particularly 
     children with special needs, including disabled infants with 
     life-threatening conditions, by--
       ``(A) promoting model adoption legislation and procedures 
     in the States and territories of the United States in order 
     to eliminate jurisdictional and legal obstacles to adoption;
       ``(B) providing a mechanism for the Department of Health 
     and Human Services to--
       ``(i) promote quality standards for adoption services, 
     preplacement, post-placement, and post-legal adoption 
     counseling, and standards to protect the rights of children 
     in need of adoption;
       ``(ii) maintain a national adoption information exchange 
     system to bring together children who would benefit from 
     adoption and qualified prospective adoptive parents who are 
     seeking such children, and conduct national recruitment 
     efforts in order to reach prospective parents for children 
     awaiting adoption; and
       ``(iii) demonstrate expeditious ways to free children for 
     adoption for whom it has been determined that adoption is the 
     appropriate plan; and
       ``(C) facilitating the identification and recruitment of 
     foster and adoptive families that can meet children's needs.
       ``(4) To respond to the needs of children, in particular 
     those who are drug exposed or afflicted with Acquired Immune 
     Deficiency Syndrome (AIDS), by supporting activities aimed at 
     preventing the abandonment of children, providing support to 
     children and their families, and facilitating the recruitment 
     and training of health and social service personnel.
       ``(5) To carry out any other activities as the Secretary 
     determines are consistent with this Act.

     ``SEC. 4. DEFINITIONS.

       ``As used in this Act:
       ``(1) Child.--The term `child' means a person who has not 
     attained the lesser of--
       ``(A) the age of 18; or
       ``(B) except in the case of sexual abuse, the age specified 
     by the child protection law of the State in which the child 
     resides.
       ``(2) Child abuse and neglect.--The term `child abuse and 
     neglect' means, at a minimum, any recent act or failure to 
     act on the part of a parent or caretaker, which results in 
     death, serious physical or emotional harm, sexual abuse or 
     exploitation, or an act or failure to act which presents an 
     imminent risk of serious harm.
       ``(3) Family resource and support programs.--The term 
     `family resource and support program' means a community-
     based, prevention-focused entity that--
       ``(A) provides, through direct service, the core services 
     required under this Act, including--
       ``(i) parent education, support and leadership services, 
     together with services characterized by relationships between 
     parents and professionals that are based on equality and 
     respect, and designed to assist parents in acquiring 
     parenting skills, learning about child development, and 
     responding appropriately to the behavior of their children;
       ``(ii) services to facilitate the ability of parents to 
     serve as resources to one another (such as through mutual 
     support and parent self-help groups);
       ``(iii) early developmental screening of children to assess 
     any needs of children, and to identify types of support that 
     may be provided;
       ``(iv) outreach services provided through voluntary home 
     visits and other methods to assist parents in becoming aware 
     of and able to participate in family resources and support 
     program activities;
       ``(v) community and social services to assist families in 
     obtaining community resources; and
       ``(vi) followup services;
       ``(B) provides, or arranges for the provision of, other 
     core services through contracts or agreements with other 
     local agencies; and
       ``(C) provides access to optional services, directly or by 
     contract, purchase of service, or interagency agreement, 
     including--
       ``(i) child care, early childhood development and early 
     intervention services;
       ``(ii) self-sufficiency and life management skills 
     training;
       ``(iii) education services, such as scholastic tutoring, 
     literacy training, and General Educational Degree services;
       ``(iv) job readiness skills;
       ``(v) child abuse and neglect prevention activities;
       ``(vi) services that families with children with 
     disabilities or special needs may require;

[[Page H7898]]

       ``(vii) community and social service referral;
       ``(viii) peer counseling;
       ``(ix) referral for substance abuse counseling and 
     treatment; and
       ``(x) help line services.
       ``(4) Indian tribe and tribal organization.--The terms 
     `Indian tribe' and `tribal organization' shall have the same 
     meanings given such terms in subsections (e) and (l), 
     respectively, of section 4 of the Indian Self-Determination 
     and Education Assistance Act (25 U.S.C. 450b(e) and (l)).
       ``(5) Respite services.--The term `respite services' means 
     short-term care services provided in the temporary absence of 
     the regular caregiver (parent, other relative, foster parent, 
     adoptive parent, or guardian) to children who--
       ``(A) are in danger of abuse or neglect;
       ``(B) have experienced abuse or neglect; or
       ``(C) have disabilities, chronic, or terminal illnesses.
     Such services shall be provided within or outside the home of 
     the child, be short-term care (ranging from a few hours to a 
     few weeks of time, per year), and be intended to enable the 
     family to stay together and to keep the child living in the 
     home and community of the child.
       ``(6) Secretary.--The term `Secretary' means the Secretary 
     of Health and Human Services.
       ``(7) Sexual abuse.--The term `sexual abuse' includes--
       ``(A) the employment, use, persuasion, inducement, 
     enticement, or coercion of any child to engage in, or assist 
     any other person to engage in, any sexually explicit conduct 
     or simulation of such conduct for the purpose of producing a 
     visual depiction of such conduct; or
       ``(B) the rape, molestation, prostitution, or other form of 
     sexual exploitation of children, or incest with children.
       ``(8) State.--The term `State' means each of the several 
     States, the District of Columbia, the Commonwealth of Puerto 
     Rico, the Virgin Islands, Guam, American Samoa, the 
     Commonwealth of the Northern Mariana Islands, and the Trust 
     Territory of the Pacific Islands.
       ``(9) Withholding of medically indicated treatment.--The 
     term `withholding of medically indicated treatment' means the 
     failure to respond to the infant's life-threatening 
     conditions by providing treatment (including appropriate 
     nutrition, hydration, and medication) which, in the treating 
     physician's or physicians' reasonable medical judgment, will 
     be most likely to be effective in ameliorating or correcting 
     all such conditions, except that the term does not include 
     the failure to provide treatment (other than appropriate 
     nutrition, hydration, or medication) to an infant when, in 
     the treating physician's or physicians' reasonable medical 
     judgment--
       ``(A) the infant is chronically and irreversibly comatose;
       ``(B) the provision of such treatment would--
       ``(i) merely prolong dying;
       ``(ii) not be effective in ameliorating or correcting all 
     of the infant's life-threatening conditions; or
       ``(iii) otherwise be futile in terms of the survival of the 
     infant; or
       ``(C) the provision of such treatment would be virtually 
     futile in terms of the survival of the infant and the 
     treatment itself under such circumstances would be inhumane.
                     ``TITLE I--GENERAL BLOCK GRANT

     ``SEC. 101. CHILD AND FAMILY SERVICES BLOCK GRANTS.

       ``(a) Eligibility.--The Secretary shall award grants to 
     eligible States that file a State plan that is approved under 
     section 102 and that otherwise meet the eligibility 
     requirements for grants under this title.
       ``(b) Amount of Grant.--The amount of a grant made to each 
     State under subsection (a) for a fiscal year shall be based 
     on the population of children under the age of 18 residing in 
     each State that applies for a grant under this section.
       ``(c) Use of Amounts.--Amounts received by a State under a 
     grant awarded under subsection (a) shall be used to carry out 
     the purposes described in section 3.

     ``SEC. 102. ELIGIBLE STATES.

       ``(a) In General.--As used in this title, the term 
     `eligible State' means a State that has submitted to the 
     Secretary, not later than October 1, 1996, and every 3 years 
     thereafter, a plan which has been signed by the chief 
     executive officer of the State and that includes the 
     following:
       ``(1) Outline of child protection program.--A written 
     document that outlines the activities the State intends to 
     conduct to achieve the purpose of this title, including the 
     procedures to be used for--
       ``(A) receiving and assessing reports of child abuse or 
     neglect;
       ``(B) investigating such reports;
       ``(C) with respect to families in which abuse or neglect 
     has been confirmed, providing services or referral for 
     services for families and children where the State makes a 
     determination that the child may safely remain with the 
     family;
       ``(D) protecting children by removing them from dangerous 
     settings and ensuring their placement in a safe environment;
       ``(E) providing training for individuals mandated to report 
     suspected cases of child abuse or neglect;
       ``(F) protecting children in foster care;
       ``(G) promoting timely adoptions;
       ``(H) protecting the rights of families, using adult 
     relatives as the preferred placement for children separated 
     from their parents where such relatives meet the relevant 
     State child protection standards; and
       ``(I) providing services to individuals, families, or 
     communities, either directly or through referral, that are 
     aimed at preventing the occurrence of child abuse and 
     neglect.
       ``(2) Certification of state law requiring the reporting of 
     child abuse and neglect.--A certification that the State has 
     in effect laws that require public officials and other 
     professionals to report, in good faith, actual or suspected 
     instances of child abuse or neglect.
       ``(3) Certification of procedures for screening, safety 
     assessment, and prompt investigation.--A certification that 
     the State has in effect procedures for receiving and 
     responding to reports of child abuse or neglect, including 
     the reports described in paragraph (2), and for the immediate 
     screening, safety assessment, and prompt investigation of 
     such reports.
       ``(4) Certification of state procedures for removal and 
     placement of abused or neglected children.--A certification 
     that the State has in effect procedures for the removal from 
     families and placement of abused or neglected children and of 
     any other child in the same household who may also be in 
     danger of abuse or neglect.
       ``(5) Certification of provisions for immunity from 
     prosecution.--A certification that the State has in effect 
     laws requiring immunity from prosecution under State and 
     local laws and regulations for individuals making good faith 
     reports of suspected or known instances of child abuse or 
     neglect.
       ``(6) Certification of provisions and procedures relating 
     to appeals.--A certification that not later than 2 years 
     after the date of the enactment of this Act, the State shall 
     have laws and procedures in effect affording individuals an 
     opportunity to appeal an official finding of abuse or 
     neglect.
       ``(7) Certification of state procedures for developing and 
     reviewing written plans for permanent placement of removed 
     children.--A certification that the State has in effect 
     procedures for ensuring that a written plan is prepared for 
     children who have been removed from their families. Such plan 
     shall specify the goals for achieving a permanent placement 
     for the child in a timely fashion, for ensuring that the 
     written plan is reviewed every 6 months (until such placement 
     is achieved), and for ensuring that information about such 
     children is collected regularly and recorded in case records, 
     and include a description of such procedures.
       ``(8) Certification of state program to provide independent 
     living services.--A certification that the State has in 
     effect a program to provide independent living services, for 
     assistance in making the transition to self-sufficient 
     adulthood, to individuals in the child protection program of 
     the State who are 16, but who are not 20 (or, at the option 
     of the State, 22), years of age, and who do not have a family 
     to which to be returned.
       ``(9) Certification of state procedures to respond to 
     reporting of medical neglect of disabled infants.--
       ``(A) In general.--A certification that the State has in 
     place for the purpose of responding to the reporting of 
     medical neglect of infants (including instances of 
     withholding of medically indicated treatment from disabled 
     infants with life-threatening conditions), procedures or 
     programs, or both (within the State child protective services 
     system), to provide for--
       ``(i) coordination and consultation with individuals 
     designated by and within appropriate health-care facilities;
       ``(ii) prompt notification by individuals designated by and 
     within appropriate health-care facilities of cases of 
     suspected medical neglect (including instances of withholding 
     of medically indicated treatment from disabled infants with 
     life-threatening conditions); and
       ``(iii) authority, under State law, for the State child 
     protective service to pursue any legal remedies, including 
     the authority to initiate legal proceedings in a court of 
     competent jurisdiction, as may be necessary to prevent the 
     withholding of medically indicated treatment from disabled 
     infants with life-threatening conditions.
       ``(B) Withholding of medically indicated treatment.--As 
     used in subparagraph (A), the term `withholding of medically 
     indicated treatment' means the failure to respond to the 
     infant's life-threatening conditions by providing treatment 
     (including appropriate nutrition, hydration, and medication) 
     which, in the treating physician's or physicians' reasonable 
     medical judgment, will be most likely to be effective in 
     ameliorating or correcting all such conditions, except that 
     such term does not include the failure to provide treatment 
     (other than appropriate nutrition, hydration, or medication) 
     to an infant when, in the treating physician's or physicians' 
     reasonable medical judgment--
       ``(i) the infant is chronically and irreversibly comatose;
       ``(ii) the provision of such treatment would--

       ``(I) merely prolong dying;
       ``(II) not be effective in ameliorating or correcting all 
     of the infant's life-threatening conditions; or
       ``(III) otherwise be futile in terms of the survival of the 
     infant; or

       ``(iii) the provision of such treatment would be virtually 
     futile in terms of the survival of the infant and the 
     treatment itself

[[Page H7899]]

     under such circumstances would be inhumane.
       ``(10) Identification of child protection goals.--The 
     quantitative goals of the State child protection program.
       ``(11) Certification of child protection standards.--With 
     respect to fiscal years beginning on or after April 1, 1996, 
     a certification that the State--
       ``(A) has completed an inventory of all children who, 
     before the inventory, had been in foster care under the 
     responsibility of the State for 6 months or more, which 
     determined--
       ``(i) the appropriateness of, and necessity for, the foster 
     care placement;
       ``(ii) whether the child could or should be returned to the 
     parents of the child or should be freed for adoption or other 
     permanent placement; and
       ``(iii) the services necessary to facilitate the return of 
     the child or the placement of the child for adoption or legal 
     guardianship;
       ``(B) is operating, to the satisfaction of the Secretary--
       ``(i) a statewide information system from which can be 
     readily determined the status, demographic characteristics, 
     location, and goals for the placement of every child who is 
     (or, within the immediately preceding 12 months, has been) in 
     foster care;
       ``(ii) a case review system for each child receiving foster 
     care under the supervision of the State;
       ``(iii) a service program designed to help children--

       ``(I) where appropriate, return to families from which they 
     have been removed; or
       ``(II) be placed for adoption, with a legal guardian, or if 
     adoption or legal guardianship is determined not to be 
     appropriate for a child, in some other planned, permanent 
     living arrangement; and

       ``(iv) a preplacement preventive services program designed 
     to help children at risk for foster care placement remain 
     with their families; and
       ``(C)(i) has reviewed (or not later than October 1, 1997, 
     will review) State policies and administrative and judicial 
     procedures in effect for children abandoned at or shortly 
     after birth (including policies and procedures providing for 
     legal representation of such children); and
       ``(ii) is implementing (or not later than October 1, 1997, 
     will implement) such policies and procedures as the State 
     determines, on the basis of the review described in clause 
     (i), to be necessary to enable permanent decisions to be made 
     expeditiously with respect to the placement of such children.
       ``(12) Certification of reasonable efforts before placement 
     of children in foster care.--A certification that the State 
     in each case will--
       ``(A) make reasonable efforts prior to the placement of a 
     child in foster care, to prevent or eliminate the need for 
     removal of the child from the child's home, and to make it 
     possible for the child to return home; and
       ``(B) with respect to families in which abuse or neglect 
     has been confirmed, provide services or referral for services 
     for families and children where the State makes a 
     determination that the child may safely remain with the 
     family.
       ``(13) Certification of confidentiality and requirements 
     for information disclosure.--
       ``(A) In general.--A certification that the State has in 
     effect and operational--
       ``(i) requirements ensuring that reports and records made 
     and maintained pursuant to the purposes of this part shall 
     only be made available to--

       ``(I) individuals who are the subject of the report;
       ``(II) Federal, State, or local government entities, or any 
     agent of such entities, having a need for such information in 
     order to carry out their responsibilities under law to 
     protect children from abuse and neglect;
       ``(III) child abuse citizen review panels;
       ``(IV) child fatality review panels;
       ``(V) a grand jury or court, upon a finding that 
     information in the record is necessary for the determination 
     of an issue before the court or grand jury; and
       ``(VI) other entities or classes of individuals statutorily 
     authorized by the State to receive such information pursuant 
     to a legitimate State purpose; and

       ``(ii) provisions that allow for public disclosure of the 
     findings or information about cases of child abuse or neglect 
     that have resulted in a child fatality or near fatality.
       ``(B) Limitation.--Disclosures made pursuant to clause (i) 
     or (ii) shall not include the identifying information 
     concerning the individual initiating a report or complaint 
     alleging suspected instances of child abuse or neglect.
       ``(C) Definition.--For purposes of this paragraph, the term 
     `near fatality' means an act that, as certified by a 
     physician, places the child in serious or critical condition.
       ``(b) Determinations.--The Secretary shall determine 
     whether a plan submitted pursuant to subsection (a) contains 
     the material required by subsection (a), other than the 
     material described in paragraph (9) of such subsection. The 
     Secretary may not require a State to include in such a plan 
     any material not described in subsection (a).

     ``SEC. 103. DATA COLLECTION AND REPORTING.

       ``(a) National Child Abuse and Neglect Data System.--The 
     Secretary shall establish a national data collection and 
     analysis program--
       ``(1) which, to the extent practicable, coordinates 
     existing State child abuse and neglect reports and which 
     shall include--
       ``(A) standardized data on substantiated, as well as false, 
     unfounded, or unsubstantiated reports; and
       ``(B) information on the number of deaths due to child 
     abuse and neglect; and
       ``(2) which shall collect, compile, analyze, and make 
     available State child abuse and neglect reporting information 
     which, to the extent practical, is universal and case-
     specific and integrated with other case-based foster care and 
     adoption data collected by the Secretary.
       ``(b) Adoption and Foster Care and Analysis and Reporting 
     Systems.--The Secretary shall implement a system for the 
     collection of data relating to adoption and foster care in 
     the United States. Such data collection system shall--
       ``(1) avoid unnecessary diversion of resources from 
     agencies responsible for adoption and foster care;
       ``(2) assure that any data that is collected is reliable 
     and consistent over time and among jurisdictions through the 
     use of uniform definitions and methodologies;
       ``(3) provide comprehensive national information with 
     respect to--
       ``(A) the demographic characteristics of adoptive and 
     foster children and their biological and adoptive or foster 
     parents;
       ``(B) the status of the foster care population (including 
     the number of children in foster care, length of placement, 
     type of placement, availability for adoption, and goals for 
     ending or continuing foster care);
       ``(C) the number and characteristics of--
       ``(i) children placed in or removed from foster care;
       ``(ii) children adopted or with respect to whom adoptions 
     have been terminated; and
       ``(iii) children placed in foster care outside the State 
     which has placement and care responsibility; and
       ``(D) the extent and nature of assistance provided by 
     Federal, State, and local adoption and foster care programs 
     and the characteristics of the children with respect to whom 
     such assistance is provided; and
       ``(4) utilize appropriate requirements and incentives to 
     ensure that the system functions reliably throughout the 
     United States.
       ``(c) Additional Information.--The Secretary may require 
     the provision of additional information under the data 
     collection system established under subsection (b) if the 
     addition of such information is agreed to by a majority of 
     the States.
       ``(d) Annual Report by the Secretary.--Within 6 months 
     after the end of each fiscal year, the Secretary shall 
     prepare a report based on information provided by the States 
     for the fiscal year pursuant to this section, and shall make 
     the report and such information available to the Congress and 
     the public.
     ``TITLE II--RESEARCH, DEMONSTRATIONS, TRAINING, AND TECHNICAL 
                               ASSISTANCE

     ``SEC. 201. RESEARCH GRANTS.

       ``(a) In General.--The Secretary, in consultation with 
     appropriate Federal officials and recognized experts in the 
     field, shall award grants or contracts for the conduct of 
     research in accordance with subsection (b).
       ``(b) Research.--Research projects to be conducted using 
     amounts received under this section--
       ``(1) shall be designed to provide information to better 
     protect children from abuse or neglect and to improve the 
     well-being of abused or neglected children, with at least a 
     portion of any such research conducted under a project being 
     field initiated;
       ``(2) shall at a minimum, focus on--
       ``(A) the nature and scope of child abuse and neglect;
       ``(B) the causes, prevention, assessment, identification, 
     treatment, cultural and socioeconomic distinctions, and the 
     consequences of child abuse and neglect;
       ``(C) appropriate, effective and culturally sensitive 
     investigative, administrative, and judicial procedures with 
     respect to cases of child abuse; and
       ``(D) the national incidence of child abuse and neglect, 
     including--
       ``(i) the extent to which incidents of child abuse are 
     increasing or decreasing in number and severity;
       ``(ii) the incidence of substantiated and unsubstantiated 
     reported child abuse cases;
       ``(iii) the number of substantiated cases that result in a 
     judicial finding of child abuse or neglect or related 
     criminal court convictions;
       ``(iv) the extent to which the number of unsubstantiated, 
     unfounded and false reported cases of child abuse or neglect 
     have contributed to the inability of a State to respond 
     effectively to serious cases of child abuse or neglect;
       ``(v) the extent to which the lack of adequate resources 
     and the lack of adequate training of reporters have 
     contributed to the inability of a State to respond 
     effectively to serious cases of child abuse and neglect;
       ``(vi) the number of unsubstantiated, false, or unfounded 
     reports that have resulted in a child being placed in 
     substitute care, and the duration of such placement;
       ``(vii) the extent to which unsubstantiated reports return 
     as more serious cases of child abuse or neglect;
       ``(viii) the incidence and prevalence of physical, sexual, 
     and emotional abuse and physical and emotional neglect in 
     substitute care;
       ``(ix) the incidence and outcomes of abuse allegations 
     reported within the context of divorce, custody, or other 
     family court proceedings, and the interaction between this

[[Page H7900]]

     venue and the child protective services system; and
       ``(x) the cases of children reunited with their families or 
     receiving family preservation services that result in 
     subsequent substantiated reports of child abuse and neglect, 
     including the death of the child; and
       ``(3) may include the appointment of an advisory board to--
       ``(A) provide recommendations on coordinating Federal, 
     State, and local child abuse and neglect activities at the 
     State level with similar activities at the State and local 
     level pertaining to family violence prevention;
       ``(B) consider specific modifications needed in State laws 
     and programs to reduce the number of unfounded or 
     unsubstantiated reports of child abuse or neglect while 
     enhancing the ability to identify and substantiate legitimate 
     cases of abuse or neglect which place a child in danger; and
       ``(C) provide recommendations for modifications needed to 
     facilitate coordinated national and Statewide data collection 
     with respect to child protection and child welfare.

     ``SEC. 202. NATIONAL CLEARINGHOUSE FOR INFORMATION RELATING 
                   TO CHILD ABUSE.

       ``(a) Establishment.--The Secretary shall, through the 
     Department of Health and Human Services, or by one or more 
     contracts of not less than 3 years duration provided through 
     a competition, establish a national clearinghouse for 
     information relating to child abuse.
       ``(b) Functions.--The Secretary shall, through the 
     clearinghouse established by subsection (a)--
       ``(1) maintain, coordinate, and disseminate information on 
     all programs, including private programs, that show promise 
     of success with respect to the prevention, assessment, 
     identification, and treatment of child abuse and neglect;
       ``(2) maintain and disseminate information relating to--
       ``(A) the incidence of cases of child abuse and neglect in 
     the United States;
       ``(B) the incidence of such cases in populations determined 
     by the Secretary under section 105(a)(1) of the Child Abuse 
     Prevention, Adoption, and Family Services Act of 1988 (as 
     such section was in effect on the day before the date of 
     enactment of this Act); and
       ``(C) the incidence of any such cases related to alcohol or 
     drug abuse;
       ``(3) disseminate information related to data collected and 
     reported by States pursuant to section 103;
       ``(4) compile, analyze, and publish a summary of the 
     research conducted under section 201; and
       ``(5) solicit public comment on the components of such 
     clearinghouse.

     ``SEC. 203. GRANTS FOR DEMONSTRATION PROJECTS.

       ``(a) Awarding of General Grants.--The Secretary may make 
     grants to, and enter into contracts with, public and 
     nonprofit private agencies or organizations (or combinations 
     of such agencies or organizations) for the purpose of 
     developing, implementing, and operating time limited, 
     demonstration programs and projects for the following 
     purposes:
       ``(1) Innovative programs and projects.--The Secretary may 
     award grants to public agencies that demonstrate innovation 
     in responding to reports of child abuse and neglect including 
     programs of collaborative partnerships between the State 
     child protective service agency, community social service 
     agencies and family support programs, schools, churches and 
     synagogues, and other community agencies to allow for the 
     establishment of a triage system that--
       ``(A) accepts, screens and assesses reports received to 
     determine which such reports require an intensive 
     intervention and which require voluntary referral to another 
     agency, program or project;
       ``(B) provides, either directly or through referral, a 
     variety of community-linked services to assist families in 
     preventing child abuse and neglect; and
       ``(C) provides further investigation and intensive 
     intervention where the child's safety is in jeopardy.
       ``(2) Kinship care programs and projects.--The Secretary 
     may award grants to public entities to assist such entities 
     in developing or implementing procedures using adult 
     relatives as the preferred placement for children removed 
     from their home, where such relatives are determined to be 
     capable of providing a safe nurturing environment for the 
     child and where, to the maximum extent practicable, such 
     relatives comply with relevant State child protection 
     standards.
       ``(3) Adoption opportunities.--The Secretary may award 
     grants to public entities to assist such entities in 
     developing or implementing programs to expand opportunities 
     for the adoption of children with special needs.
       ``(4) Family resource centers.--The Secretary may award 
     grants to public or nonprofit private entities to provide for 
     the establishment of family resource programs and support 
     services that--
       ``(A) develop, expand, and enhance statewide networks of 
     community-based, prevention-focused centers, programs, or 
     services that provide comprehensive support for families;
       ``(B) promote the development of parental competencies and 
     capacities in order to increase family stability;
       ``(C) support the additional needs of families with 
     children with disabilities;
       ``(D) foster the development of a continuum of preventive 
     services for children and families through State and 
     community-based collaborations and partnerships (both public 
     and private); and
       ``(E) maximize funding for the financing, planning, 
     community mobilization, collaboration, assessment, 
     information and referral, startup, training and technical 
     assistance, information management, reporting, and evaluation 
     costs for establishing, operating, or expanding a statewide 
     network of community-based, prevention-focused family 
     resource and support services.
       ``(5) Other innovative programs.--The Secretary may award 
     grants to public or private nonprofit organizations to assist 
     such entities in developing or implementing innovative 
     programs and projects that show promise of preventing and 
     treating cases of child abuse and neglect (such as Parents 
     Anonymous).
       ``(b) Grants for Abandoned Infant Programs.--The Secretary 
     may award grants to public and nonprofit private entities to 
     assist such entities in developing or implementing 
     procedures--
       ``(1) to prevent the abandonment of infants and young 
     children, including the provision of services to members of 
     the natural family for any condition that increases the 
     probability of abandonment of an infant or young child;
       ``(2) to identify and address the needs of abandoned 
     infants and young children;
       ``(3) to assist abandoned infants and young children to 
     reside with their natural families or in foster care, as 
     appropriate;
       ``(4) to recruit, train, and retain foster families for 
     abandoned infants and young children;
       ``(5) to carry out residential care programs for abandoned 
     infants and young children who are unable to reside with 
     their families or to be placed in foster care;
       ``(6) to carry out programs of respite care for families 
     and foster families of infants and young children; and
       ``(7) to recruit and train health and social services 
     personnel to work with families, foster care families, and 
     residential care programs for abandoned infants and young 
     children.
       ``(c) Evaluation.--In making grants for demonstration 
     projects under this section, the Secretary shall require all 
     such projects to be evaluated for their effectiveness. 
     Funding for such evaluations shall be provided either as a 
     stated percentage of a demonstration grant or as a separate 
     grant entered into by the Secretary for the purpose of 
     evaluating a particular demonstration project or group of 
     projects.

     ``SEC. 204. TECHNICAL ASSISTANCE.

       ``(a) Child Abuse and Neglect.--
       ``(1) In general.--The Secretary shall provide technical 
     assistance under this title to States to assist such States 
     in planning, improving, developing, and carrying out programs 
     and activities relating to the prevention, assessment 
     identification, and treatment of child abuse and neglect.
       ``(2) Evaluation.--Technical assistance provided under 
     paragraph (1) may include an evaluation or identification 
     of--
       ``(A) various methods and procedures for the investigation, 
     assessment, and prosecution of child physical and sexual 
     abuse cases;
       ``(B) ways to mitigate psychological trauma to the child 
     victim; and
       ``(C) effective programs carried out by the States under 
     this Act.
       ``(b) Adoption Opportunities.--The Secretary shall provide, 
     directly or by grant to or contract with public or private 
     nonprofit agencies or organizations--
       ``(1) technical assistance and resource and referral 
     information to assist State or local governments with 
     termination of parental rights issues, in recruiting and 
     retaining adoptive families, in the successful placement of 
     children with special needs, and in the provision of pre- and 
     post-placement services, including post-legal adoption 
     services; and
       ``(2) other assistance to help State and local governments 
     replicate successful adoption-related projects from other 
     areas in the United States.

     ``SEC. 205. TRAINING RESOURCES.

       ``(a) Training Programs.--The Secretary may award grants to 
     public or private nonprofit organizations--
       ``(1) for the training of professional and paraprofessional 
     personnel in the fields of medicine, law, education, law 
     enforcement, social work, and other relevant fields who are 
     engaged in, or intend to work in, the field of prevention, 
     identification, and treatment of child abuse and neglect, 
     including the links between domestic violence and child 
     abuse;
       ``(2) to provide culturally specific instruction in methods 
     of protecting children from child abuse and neglect to 
     children and to persons responsible for the welfare of 
     children, including parents of and persons who work with 
     children with disabilities; and
       ``(3) to improve the recruitment, selection, and training 
     of volunteers serving in private and public nonprofit 
     children, youth and family service organizations in order to 
     prevent child abuse and neglect through collaborative 
     analysis of current recruitment, selection, and training 
     programs and development of model programs for dissemination 
     and replication nationally.
       ``(b) Dissemination of Information.--The Secretary may 
     provide for and disseminate

[[Page H7901]]

     information relating to various training resources available 
     at the State and local level to--
       ``(1) individuals who are engaged, or who intend to engage, 
     in the prevention, identification, assessment, and treatment 
     of child abuse and neglect; and
       ``(2) appropriate State and local officials, including 
     prosecutors, to assist in training law enforcement, legal, 
     judicial, medical, mental health, education, and child 
     welfare personnel in appropriate methods of interacting 
     during investigative, administrative, and judicial 
     proceedings with children who have been subjected to abuse.

     ``SEC. 206. APPLICATIONS AND AMOUNTS OF GRANTS.

       ``(a) Requirement of Application.--The Secretary may not 
     make a grant to a State or other entity under this title 
     unless--
       ``(1) an application for the grant is submitted to the 
     Secretary;
       ``(2) with respect to carrying out the purpose for which 
     the grant is to be made, the application provides assurances 
     of compliance satisfactory to the Secretary; and
       ``(3) the application otherwise is in such form, is made in 
     such manner, and contains such agreements, assurances, and 
     information as the Secretary determines to be necessary to 
     carry out this title.
       ``(b) Amount of Grant.--The Secretary shall determine the 
     amount of a grant to be awarded under this title.

     ``SEC. 207. PEER REVIEW FOR GRANTS.

       ``(a) Establishment of Peer Review Process.--
       ``(1) In general.--The Secretary shall, in consultation 
     with experts in the field and other Federal agencies, 
     establish a formal, rigorous, and meritorious peer review 
     process for purposes of evaluating and reviewing applications 
     for grants under this title and determining the relative 
     merits of the projects for which such assistance is 
     requested. The purpose of this process is to enhance the 
     quality and usefulness of research in the field of child 
     abuse and neglect.
       ``(2) Requirements for members.--In establishing the 
     process required by paragraph (1), the Secretary shall 
     appoint to the peer review panels only members who are 
     experts in the field of child abuse and neglect or related 
     disciplines, with appropriate expertise in the application to 
     be reviewed, and who are not individuals who are officers or 
     employees of the Administration for Children and Families. 
     The panels shall meet as often as is necessary to facilitate 
     the expeditious review of applications for grants and 
     contracts under this title, but may not meet less than once a 
     year. The Secretary shall ensure that the peer review panel 
     utilizes scientifically valid review criteria and scoring 
     guidelines for review committees.
       ``(b) Review of Applications for Assistance.--Each peer 
     review panel established under subsection (a)(1) that reviews 
     any application for a grant shall--
       ``(1) determine and evaluate the merit of each project 
     described in such application;
       ``(2) rank such application with respect to all other 
     applications it reviews in the same priority area for the 
     fiscal year involved, according to the relative merit of all 
     of the projects that are described in such application and 
     for which financial assistance is requested; and
       ``(3) make recommendations to the Secretary concerning 
     whether the application for the project shall be approved.
     The Secretary shall award grants under this title on the 
     basis of competitive review.
       ``(c) Notice of Approval.--
       ``(1) In general.--The Secretary shall provide grants under 
     this title from among the projects which the peer review 
     panels established under subsection (a)(1) have determined to 
     have merit.
       ``(2) Requirement of explanation.--In the instance in which 
     the Secretary approves an application for a program under 
     this title without having approved all applications ranked 
     above such application, the Secretary shall append to the 
     approved application a detailed explanation of the reasons 
     relied on for approving the application and for failing to 
     approve each pending application that is superior in merit.

     ``SEC. 208. NATIONAL RANDOM SAMPLE STUDY OF CHILD WELFARE.

       ``(a) In General.--The Secretary shall conduct a national 
     study based on random samples of children who are at risk of 
     child abuse or neglect, or are determined by States to have 
     been abused or neglected, and such other research as may be 
     necessary.
       ``(b) Requirements.--The study required by subsection (a) 
     shall--
       ``(1) have a longitudinal component; and
       ``(2) yield data reliable at the State level for as many 
     States as the Secretary determines is feasible.
       ``(c) Preferred Contents.--In conducting the study required 
     by subsection (a), the Secretary should--
       ``(1) collect data on the child protection programs of 
     different small States (or different groups of such States) 
     in different years to yield an occasional picture of the 
     child protection programs of such States;
       ``(2) carefully consider selecting the sample from cases of 
     confirmed abuse or neglect; and
       ``(3) follow each case for several years while obtaining 
     information on, among other things--
       ``(A) the type of abuse or neglect involved;
       ``(B) the frequency of contact with State or local 
     agencies;
       ``(C) whether the child involved has been separated from 
     the family, and, if so, under what circumstances;
       ``(D) the number, type, and characteristics of out-of-home 
     placements of the child; and
       ``(E) the average duration of each placement.
       ``(d) Reports.--
       ``(1) In general.--From time to time, the Secretary shall 
     prepare reports summarizing the results of the study required 
     by subsection (a).
       ``(2) Availability.--The Secretary shall make available to 
     the public any report prepared under paragraph (1), in 
     writing or in the form of an electronic data tape.
       ``(3) Authority to charge fee.--The Secretary may charge 
     and collect a fee for the furnishing of reports under 
     paragraph (2).
       ``(4) Funding.--The Secretary shall carry out this section 
     using amounts made available under section 425 of the Social 
     Security Act.
                    ``TITLE III--GENERAL PROVISIONS

     ``SEC. 301. AUTHORIZATION OF APPROPRIATIONS.

       ``(a) Title I.--There are authorized to be appropriated to 
     carry out title I, $230,000,000 for fiscal year 1996, and 
     such sums as may be necessary for each of the fiscal years 
     1997 through 2002.
       ``(b) Title II.--
       ``(1) In general.--Of the amount appropriated under 
     subsection (a) for a fiscal year, the Secretary shall make 
     available 12 percent of such amount to carry out title II 
     (except for sections 203 and 208).
       ``(2) Grants for demonstration projects.--Of the amount 
     made available under paragraph (1) for a fiscal year, the 
     Secretary shall make available not less than 40 percent of 
     such amount to carry out section 203.
       ``(c) Indian Tribes.--Of the amount appropriated under 
     subsection (a) for a fiscal year, the Secretary shall make 
     available 1 percent of such amount to provide grants and 
     contracts to Indian tribes and Tribal Organizations.
       ``(d) Availability of Appropriations.--Amounts appropriated 
     under subsection (a) shall remain available until expended.

     ``SEC. 302. GRANTS TO STATES FOR PROGRAMS RELATING TO THE 
                   INVESTIGATION AND PROSECUTION OF CHILD ABUSE 
                   AND NEGLECT CASES.

       ``(a) Grants to States.--The Secretary, in consultation 
     with the Attorney General, is authorized to make grants to 
     the States for the purpose of assisting States in developing, 
     establishing, and operating programs designed to improve--
       ``(1) the handling of child abuse and neglect cases, 
     particularly cases of child sexual abuse and exploitation, in 
     a manner which limits additional trauma to the child victim;
       ``(2) the handling of cases of suspected child abuse or 
     neglect related fatalities; and
       ``(3) the investigation and prosecution of cases of child 
     abuse and neglect, particularly child sexual abuse and 
     exploitation.
       ``(b) Eligibility Requirements.--In order for a State to 
     qualify for assistance under this section, such State shall--
       ``(1) be an eligible State under section 102;
       ``(2) establish a task force as provided in subsection (c);
       ``(3) fulfill the requirements of subsection (d);
       ``(4) submit annually an application to the Secretary at 
     such time and containing such information and assurances as 
     the Secretary considers necessary, including an assurance 
     that the State will--
       ``(A) make such reports to the Secretary as may reasonably 
     be required; and
       ``(B) maintain and provide access to records relating to 
     activities under subsection (a); and
       ``(5) submit annually to the Secretary a report on the 
     manner in which assistance received under this program was 
     expended throughout the State, with particular attention 
     focused on the areas described in paragraphs (1) through (3) 
     of subsection (a).
       ``(c) State Task Forces.--
       ``(1) General rule.--Except as provided in paragraph (2), a 
     State requesting assistance under this section shall 
     establish or designate, and maintain, a State 
     multidisciplinary task force on children's justice (hereafter 
     in this section referred to as `State task force') composed 
     of professionals with knowledge and experience relating to 
     the criminal justice system and issues of child physical 
     abuse, child neglect, child sexual abuse and exploitation, 
     and child maltreatment related fatalities. The State task 
     force shall include--
       ``(A) individuals representing the law enforcement 
     community;
       ``(B) judges and attorneys involved in both civil and 
     criminal court proceedings related to child abuse and neglect 
     (including individuals involved with the defense as well as 
     the prosecution of such cases);
       ``(C) child advocates, including both attorneys for 
     children and, where such programs are in operation, court 
     appointed special advocates;
       ``(D) health and mental health professionals;
       ``(E) individuals representing child protective service 
     agencies;
       ``(F) individuals experienced in working with children with 
     disabilities;
       ``(G) parents; and
       ``(H) representatives of parents' groups.
       ``(2) Existing task force.--As determined by the Secretary, 
     a State commission or task force established after January 1, 
     1983, with substantially comparable membership and functions, 
     may be considered the State task force for purposes of this 
     subsection.

[[Page H7902]]

       ``(d) State Task Force Study.--Before a State receives 
     assistance under this section, and at 3-year intervals 
     thereafter, the State task force shall comprehensively--
       ``(1) review and evaluate State investigative, 
     administrative and both civil and criminal judicial handling 
     of cases of child abuse and neglect, particularly child 
     sexual abuse and exploitation, as well as cases involving 
     suspected child maltreatment related fatalities and cases 
     involving a potential combination of jurisdictions, such as 
     interstate, Federal-State, and State-Tribal; and
       ``(2) make policy and training recommendations in each of 
     the categories described in subsection (e).
     The task force may make such other comments and 
     recommendations as are considered relevant and useful.
       ``(e) Adoption of State Task Force Recommendations.--
       ``(1) General rule.--Subject to the provisions of paragraph 
     (2), before a State receives assistance under this section, a 
     State shall adopt recommendations of the State task force in 
     each of the following categories--
       ``(A) investigative, administrative, and judicial handling 
     of cases of child abuse and neglect, particularly child 
     sexual abuse and exploitation, as well as cases involving 
     suspected child maltreatment related fatalities and cases 
     involving a potential combination of jurisdictions, such as 
     interstate, Federal-State, and State-Tribal, in a manner 
     which reduces the additional trauma to the child victim and 
     the victim's family and which also ensures procedural 
     fairness to the accused;
       ``(B) experimental, model and demonstration programs for 
     testing innovative approaches and techniques which may 
     improve the prompt and successful resolution of civil and 
     criminal court proceedings or enhance the effectiveness of 
     judicial and administrative action in child abuse and neglect 
     cases, particularly child sexual abuse and exploitation 
     cases, including the enhancement of performance of court-
     appointed attorneys and guardians ad litem for children; and
       ``(C) reform of State laws, ordinances, regulations, 
     protocols and procedures to provide comprehensive protection 
     for children from abuse, particularly child sexual abuse and 
     exploitation, while ensuring fairness to all affected 
     persons.
       ``(2) Exemption.--As determined by the Secretary, a State 
     shall be considered to be in fulfillment of the requirements 
     of this subsection if--
       ``(A) the State adopts an alternative to the 
     recommendations of the State task force, which carries out 
     the purpose of this section, in each of the categories under 
     paragraph (1) for which the State task force's 
     recommendations are not adopted; or
       ``(B) the State is making substantial progress toward 
     adopting recommendations of the State task force or a 
     comparable alternative to such recommendations.
       ``(f) Funds Available.--For grants under this section, the 
     Secretary shall use the amount authorized by section 1404A of 
     the Victims of Crime Act of 1984.

     ``SEC. 303. TRANSITIONAL PROVISION.

       ``A State or other entity that has a grant, contract, or 
     cooperative agreement in effect, on the date of enactment of 
     this Act, under the Family Resource and Support Program, the 
     Community-Based Family Resource Program, the Family Support 
     Center Program, the Emergency Child Abuse Prevention Grant 
     Program, the Abandoned Infants Assistance Act of 1988, or the 
     Temporary Child Care for Children with Disabilities and 
     Crisis Nurseries Programs shall continue to receive funds 
     under such grant, contract, or cooperative agreement, subject 
     to the original terms under which such funds were provided, 
     through the end of the applicable grant, contract, or 
     agreement cycle.

     ``SEC. 304. RULE OF CONSTRUCTION.

       ``(a) In General.--Nothing in this Act, or in part B or E 
     of title IV of the Social Security Act, shall be construed--
       ``(1) as establishing a Federal requirement that a parent 
     or legal guardian provide a child any medical service or 
     treatment against the religious beliefs of the parent or 
     legal guardian; and
       ``(2) to require that a State find, or to prohibit a State 
     from finding, abuse or neglect in cases in which a parent or 
     legal guardian relies solely or partially upon spiritual 
     means rather than medical treatment, in accordance with the 
     religious beliefs of the parent or legal guardian.
       ``(b) State Requirement.--Notwithstanding subsection (a), a 
     State shall have in place authority under State law to permit 
     the child protective service system of the State to pursue 
     any legal remedies, including the authority to initiate legal 
     proceedings in a court of competent jurisdiction, to provide 
     medical care or treatment for a child when such care or 
     treatment is necessary to prevent or remedy serious harm to 
     the child, or to prevent the withholding of medically 
     indicated treatment from children with life threatening 
     conditions. Except with respect to the withholding of 
     medically indicated treatments from disabled infants with 
     life threatening conditions, case by case determinations 
     concerning the exercise of the authority of this subsection 
     shall be within the sole discretion of the State.''.

     SEC. 4752. REAUTHORIZATIONS.

       (a) Missing Children's Assistance Act.--Section 408 of the 
     Missing Children's Assistance Act (42 U.S.C. 5777) is 
     amended--
       (1) by striking ``To'' and inserting ``(a) In General.--
     To''
       (2) by striking ``and 1996'' and inserting ``1996, and 
     1997''; and
       (3) by adding at the end thereof the following new 
     subsection:
       ``(b) Evaluation.--The Administrator shall use not more 
     than 5 percent of the amount appropriated for a fiscal year 
     under subsection (a) to conduct an evaluation of the 
     effectiveness of the programs and activities established and 
     operated under this title.''.
       (b) Victims of Child Abuse Act of 1990.--Section 214B of 
     the Victims of Child Abuse Act of 1990 (42 U.S.C. 13004) is 
     amended--
       (1) in subsection (a)(2), by striking ``and 1996'' and 
     inserting ``1996, and 1997''; and
       (2) in subsection (b)(2), by striking ``and 1996'' and 
     inserting ``1996, and 1997''.

     SEC. 4753. REPEALS.

       (a) In General.--The following provisions of law are 
     repealed:
       (1) Title II of the Child Abuse Prevention and Treatment 
     and Adoption Reform Act of 1978 (42 U.S.C. 5111 et seq.).
       (2) The Abandoned Infants Assistance Act of 1988 (42 U.S.C. 
     670 note).
       (3) The Temporary Child Care for Children with Disabilities 
     and Crisis Nurseries Act of 1986 (42 U.S.C. 5117 et seq.).
       (4) Subtitle F of title VII of the Stewart B. McKinney 
     Homeless Assistance Act (42 U.S.C. 11481 et seq.).
       (b) Conforming Amendments.--
       (1) Recommended legislation.--After consultation with the 
     appropriate committees of the Congress and the Director of 
     the Office of Management and Budget, the Secretary of Health 
     and Human Services shall prepare and submit to the Congress a 
     legislative proposal in the form of an implementing bill 
     containing technical and conforming amendments to reflect the 
     repeals made by this section.
       (2) Submission to congress.--Not later than 6 months after 
     the date of enactment of this subchapter, the Secretary of 
     Health and Human Services shall submit the implementing bill 
     referred to under paragraph (1).
         Subtitle G--Reductions in Federal Government Positions

     SEC. 4801. REDUCTIONS.

       (a) Definitions.--As used in this section:
       (1) Appropriate effective date.--The term ``appropriate 
     effective date'', used with respect to a Department referred 
     to in this section, means the date on which all provisions of 
     this Act (other than subtitle B of this title) that the 
     Department is required to carry out, and amendments and 
     repeals made by this Act to provisions of Federal law that 
     the Department is required to carry out, are effective.
       (2) Covered activity.--The term ``covered activity'', used 
     with respect to a Department referred to in this section, 
     means an activity that the Department is required to carry 
     out under--
       (A) a provision of this Act (other than subtitle B of this 
     title); or
       (B) a provision of Federal law that is amended or repealed 
     by this Act (other than subtitle B of this title).
       (b) Reports.--
       (1) Contents.--Not later than January 1, 1997, each 
     Secretary referred to in paragraph (2) shall prepare and 
     submit to the relevant committees described in paragraph (3) 
     a report containing--
       (A) the determinations described in subsection (c);
       (B) appropriate documentation in support of such 
     determinations; and
       (C) a description of the methodology used in making such 
     determinations.
       (2) Secretary.--The Secretaries referred to in this 
     paragraph are--
       (A) the Secretary of Agriculture;
       (B) the Secretary of Education;
       (C) the Secretary of Labor;
       (D) the Secretary of Housing and Urban Development; and
       (E) the Secretary of Health and Human Services.
       (3) Relevant committees.--The relevant Committees described 
     in this paragraph are the following:
       (A) With respect to each Secretary described in paragraph 
     (2), the Committee on Government Reform and Oversight of the 
     House of Representatives and the Committee on Governmental 
     Affairs of the Senate.
       (B) With respect to the Secretary of Agriculture, the 
     Committee on Agriculture and the Committee on Economic and 
     Educational Opportunities of the House of Representatives and 
     the Committee on Agriculture, Nutrition, and Forestry of the 
     Senate.
       (C) With respect to the Secretary of Education, the 
     Committee on Economic and Educational Opportunities of the 
     House of Representatives and the Committee on Labor and Human 
     Resources of the Senate.
       (D) With respect to the Secretary of Labor, the Committee 
     on Economic and Educational Opportunities of the House of 
     Representatives and the Committee on Labor and Human 
     Resources of the Senate.
       (E) With respect to the Secretary of Housing and Urban 
     Development, the Committee on Banking and Financial Services 
     of the House of Representatives and the Committee on Banking, 
     Housing, and Urban Affairs of the Senate.
       (F) With respect to the Secretary of Health and Human 
     Services, the Committee on Economic and Educational 
     Opportunities of the House of Representatives, the Committee 
     on Labor and Human Resources of the Senate, the Committee on 
     Ways and Means of the House of Representatives, and the 
     Committee on Finance of the Senate.

[[Page H7903]]

       (4) Report on changes.--Not later than December 31, 1996, 
     and each December 31 thereafter, each Secretary referred to 
     in paragraph (2) shall prepare and submit to the relevant 
     Committees described in paragraph (3), a report concerning 
     any changes with respect to the determinations made under 
     subsection (c) for the year in which the report is being 
     submitted.
       (c) Determinations.--Not later than December 31, 1996, each 
     Secretary referred to in subsection (b)(2) shall determine--
       (1) the number of full-time equivalent positions required 
     by the Department headed by such Secretary to carry out the 
     covered activities of the Department, as of the day before 
     the date of enactment of this Act;
       (2) the number of such positions required by the Department 
     to carry out the activities, as of the appropriate effective 
     date for the Department; and
       (3) the difference obtained by subtracting the number 
     referred to in paragraph (2) from the number referred to in 
     paragraph (1).
       (d) Actions.--Each Secretary referred to in subsection 
     (b)(2) shall take such actions as may be necessary, including 
     reduction in force actions, consistent with sections 3502 and 
     3595 of title 5, United States Code, to reduce the number of 
     positions of personnel of the Department--
       (1) not later than 30 days after the appropriate effective 
     date for the Department involved, by at least 50 percent of 
     the difference referred to in subsection (c)(3); and
       (2) not later than 13 months after such appropriate 
     effective date, by at least the remainder of such difference 
     (after the application of paragraph (1)).
       (e) Consistency.--
       (1) Education.--The Secretary of Education shall carry out 
     this section in a manner that enables the Secretary to meet 
     the requirements of this section.
       (2) Labor.--The Secretary of Labor shall carry out this 
     section in a manner that enables the Secretary to meet the 
     requirements of this section.
       (3) Health and human services.--The Secretary of Health and 
     Human Services shall carry out this section in a manner that 
     enables the Secretary to meet the requirements of this 
     section and sections 4802 and 4803.
       (f) Calculation.--In determining, under subsection (c), the 
     number of full-time equivalent positions required by a 
     Department to carry out a covered activity, a Secretary 
     referred to in subsection (b)(2) shall include the number of 
     such positions occupied by personnel carrying out program 
     functions or other functions (including budgetary, 
     legislative, administrative, planning, evaluation, and legal 
     functions) related to the activity.
       (g) General Accounting Office Report.--Not later than July 
     1, 1997, the Comptroller General of the United States shall 
     prepare and submit to the committees described in subsection 
     (b)(3), a report concerning the determinations made by each 
     Secretary under subsection (c). Such report shall contain an 
     analysis of the determinations made by each Secretary under 
     subsection (c) and a determination as to whether further 
     reductions in full-time equivalent positions are appropriate.

     SEC. 4802. REDUCTIONS IN FEDERAL BUREAUCRACY.

       (a) In General.--The Secretary of Health and Human Services 
     shall reduce the Federal workforce within the Department of 
     Health and Human Services by an amount equal to the sum of--
       (1) 75 percent of the full-time equivalent positions at 
     such Department that relate to any direct spending program, 
     or any program funded through discretionary spending, that 
     has been converted into a block grant program under this Act 
     and the amendments made by this Act; and
       (2) an amount equal to 75 percent of that portion of the 
     total full-time equivalent departmental management positions 
     at such Department that bears the same relationship to the 
     amount appropriated for the programs referred to in paragraph 
     (1) as such amount relates to the total amount appropriated 
     for use by such Department.
       (b) Reductions in the Department of Health and Human 
     Services.--Notwithstanding any other provision of this Act, 
     the Secretary of Health and Human Services shall take such 
     actions as may be necessary, including reductions in force 
     actions, consistent with sections 3502 and 3595 of title 5, 
     United States Code, to reduce the full-time equivalent 
     positions within the Department of Health and Human 
     Services--
       (1) by 245 full-time equivalent positions related to the 
     program converted into a block grant under the amendment made 
     by section 103; and
       (2) by 60 full-time equivalent managerial positions in the 
     Department.

     SEC. 4803. REDUCING PERSONNEL IN WASHINGTON, D.C. AREA.

       In making reductions in full-time equivalent positions, the 
     Secretary of Health and Human Services is encouraged to 
     reduce personnel in the Washington, D.C., area office (agency 
     headquarters) before reducing field personnel.
                       Subtitle H--Miscellaneous

     SEC. 4901. APPROPRIATION BY STATE LEGISLATURES.

       (a) In General.--Any funds received by a State under the 
     provisions of law specified in subsection (b) shall be 
     subject to appropriation by the State legislature, consistent 
     with the terms and conditions required under such provisions 
     of law.
       (b) Provisions of Law.--The provisions of law specified in 
     this subsection are the following:
       (1) Part A of title IV of the Social Security Act (relating 
     to block grants for temporary assistance for needy families).
       (2) Section 25 of the Food Stamp Act of 1977 (relating to 
     the optional State food assistance block grant).
       (3) The Child Care and Development Block Grant Act of 1990 
     (relating to block grants for child care).

     SEC. 4902. SANCTIONING FOR TESTING POSITIVE FOR CONTROLLED 
                   SUBSTANCES.

       Notwithstanding any other provision of law, States shall 
     not be prohibited by the Federal Government from testing 
     welfare recipients for use of controlled substances nor from 
     sanctioning welfare recipients who test positive for use of 
     controlled substances.

     SEC. 4903. REDUCTION IN BLOCK GRANTS TO STATES FOR SOCIAL 
                   SERVICES.

       Section 2003(c) of the Social Security Act (42 U.S.C. 
     1397b(c)) is amended--
       (1) by striking ``and'' at the end of paragraph (4); and
       (2) by striking paragraph (5) and inserting the following:
       ``(5) $2,800,000,000 for each of the fiscal years 1990 
     through 1995;
       ``(6) $2,520,000,000 for each of the fiscal years 1997 
     through 2002; and
       ``(7) $2,380,000,000 for the fiscal year 2003 and each 
     succeeding fiscal year.''.

  The CHAIRMAN. No other amendment shall be in order except the 
following amendments:
  First, a further amendment printed in part 2 of the report, which may 
be offered only by the gentleman from Ohio [Mr. Kasich] or his 
designee, shall be considered read, shall be debatable for the time 
specified in the report, equally divided and controlled by the 
proponent and an opponent, shall not be subject to amendment, and shall 
not be subject to a demand for division of the question; and
  Second, a further amendment in the nature of a substitute consisting 
of the text of H.R. 3832, which may be offered only by the gentleman 
from Missouri [Mr. Gephardt] or his designee, shall be considered read, 
shall be debatable for 1 hour, equally divided and controlled by the 
proponent and an opponent, and shall not be subject to amendment.


                      amendment offered by Mr. ney

  Mr. NEY. Mr. Chairman, I offer an amendment as the designee of the 
gentleman from Ohio [Mr. Kasich].
  The CHAIRMAN. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Amendment offered by Mr. Ney:
       Subsection (o) of section 6 of the Food Stamp Act of 1977 
     (7 U.S.C. 2015), as added by section 1033(a), is amended--
       (1) in paragraph (2)--
       (A) by striking ``, during the preceding 12-month 
     period,'',
       (B) by inserting ``after the effective date of this 
     subsection'' after ``received'', and
       (C) by striking ``4'' and insert ``3'', and
       (2) in paragraph (5) by striking subparagraph (B) and 
     making such technical and conforming changes as may be 
     appropriate.
       Section 1033 is amended by striking subsection (b) and 
     making such technical and conforming changes as may be 
     appropriate.

  The CHAIRMAN. Pursuant to House Resolution 482, the gentleman from 
Ohio [Mr. Ney] and a Member opposed each will control 10 minutes.
  Mr. SABO. Madam Chairman, I rise in opposition.
  The CHAIRMAN. The gentleman from Minnesota [Mr. Sabo] will be 
recognized to control the time in opposition.
  The Chair recognizes the gentleman from Ohio [Mr. Ney].
  Mr. NEY. Madam Chairman, I yield myself such time as I may consume.
  Madam Chairman, caring for people is not necessarily synonymous with 
taking care of people. Anyone can say that they feel pain, and many 
people obviously do feel pain for others that have not had the path of 
opportunity in this country. We have to work with all Americans to try 
and alleviate and minimize and finally end the pain once and for all. 
We need to reach out a helping hand to every person currently in the 
welfare system and say to them: If you want to work, we're going to 
help you climb that ladder of opportunity in this great country.
  My amendment, which is the Kasich-Ney amendment, and I thank my 
colleague, the gentleman from Ohio [Mr. Kasich], for his guidance and 
support on this amendment; this amendment to H.R. 3437 is just that: It 
is a ladder. The amendment will tell every able-bodied person without 
children between the ages of 18 and 50 that there is no escalator built 
by Washington that will carry them up the ladder of opportunity, but 
with a little help from us,

[[Page H7904]]

and if they are willing to help themselves, they can have a chance in 
this country.
  Madam Chairman, as my colleagues know, under the base text of the 
bill, able-bodied adults between the ages of 18 and 50 who have no 
children are permitted to receive food stamps without working for 4 
months out of every 12-month period. This means they could potentially 
work 8 months and take 4 months off. The amendment, while retaining the 
exemptions in the base bill; I would like to just restate those 
exemptions for the record; this is who the amendment does not affect: 
Anyone under 18 or over the age of 50, anyone medically certified as 
physically or mentally incapable or unable to be employed, a parent or 
other member of the household responsible for a dependent child or a 
pregnant woman.
  Those are the persons that are not included in this amendment. They 
are exempted from it.
  What I am talking about, very clearly, are people who have no 
dependents, that are 18 years old to 50 years old that are able to work 
and are receiving food stamps. So instead of the 4 months off 
potentially every year, there will be a 3-month lifetime ability to 
take off.
  Now, they have to remain employed for at least 20 hours, be in a job 
training program or one of the workfare programs.
  I believe that this is a very fair measure. I believe that this is a 
measure that will help people on the opportunity scale in this country.
  I would ask, Madam Chairman, why does Washington continue to promote 
a welfare system that discourages work? Is it extreme to think that we 
can do better? Is it extreme to want to give welfare recipients hope 
instead of an endless cycle of dependency? Should we not be trying to 
encourage work?
  And that is what this amendment does, but it is an amendment that 
provides some safety, it provides a course of a safety net, it has the 
ability to have waivers from the State departments of human services. 
So it is a well-crafted, very fair amendment, but it simply says: If 
you want assistance from your government and you are 18 to 50 years 
old, and you don't have any dependents, and you are capable of working, 
then you have to simply work.
  This is a fair amendment, it provides the change that is necessary in 
this country, and let me just say in closing, as my colleague, the 
gentleman from Ohio [Mr. Kasich], many times refers to the end of the 
day, this amendment is referring to the end of the day because that day 
has come that we have to step up to the plate and take the 
responsibility to help people.
  The easy path is to say to an individual man or woman in this 
country, Take the check, don't be seen, take 4 months of the year off, 
we don't want to address the problem of what we do with you.
  What we are doing is forcing this issue to be addressed, but we are 
providing help to a person. But we want to say that, yes, we are going 
to be there. There are going to be some problems throughout the course 
in welfare reform, we better believe there are. But I can tell my 
colleagues for sure that the current system is in hard failure, and the 
current system is not creating opportunity, and what the bottom line of 
this Congress is and the bottom line of this change in this country, 
this is about children, and each and every one of us as human beings 
are responsible, we are responsible for whether this planet is going to 
be safe and prosperous and peaceful for children, and we do not want to 
have a legacy of children who know nothing but the welfare system. We 
want to provide opportunity.
  This is another step in the right direction, it is a caring step, and 
it shows that we are a Congress that cares to help involve people in 
that ladder of opportunity.
  Madam Chairman, I reserve the balance of my time.
  Mr. SABO. Madam Chairman, I yield 3 minutes to the distinguished 
gentleman from Texas [Mr. Stenholm].
  (Mr. STENHOLM asked and was given permission to revise and extend his 
remarks.)
  Mr. STENHOLM. Madam Chairman, I rise in opposition to this single-
bullet amendment to this year's first reconciliation bill. I understand 
full well the political advantage which is sought with amendments such 
as this. I am certainly not interested in ever defending a wasteful use 
of food stamps. But I am also interested in abandoning people in real 
need, confronted by unexpected, uncontrollable circumstances who count 
on food stamps for their survival.
  I find it amazing that the Rules Committee took the unprecedented 
action of allowing an amendment other than a complete substitute. Had I 
known there was any possibility of such amendments being made in order, 
I assure my colleagues I would have had a number of my own to offer, 
and I know dozens of other Members would have wanted to do the same.
  This unprecedented change of the rules aside, I must point out that 
this particular amendment is not about a food stamp time limit; it is a 
lifetime ban on food stamp benefits if ever they have received them in 
their adult life for 3 months and been unable to find work during that 
3 months. If they have faced unexpected and uncontrollable 
circumstances in their life, if they have been laid off from their job 
in a period of recession, if they went on food stamps, searched high 
and low for work and found nothing after 3 months, it is tough luck for 
them. They are off the food stamp program and until they have reached 
age 50 or until you have found a job. It does not matter if they are 
following all of the rules, looking for work, in real need of a hand 
up, the food stamp program just will not be there for them.
  The implication behind this amendment is that finding some kind of 
job is always easy. That simply is not true.
  For example, food stamp data show that more than 40 percent of those 
who would be affected by this provision are women, and nearly one-third 
of those women are over the age of 40. Whether widowed, divorced, or 
facing some other difficult life circumstance, these 40-plus women 
typically have a very difficult time finding employment. Their skills 
may be out of date or underdeveloped because they have been raising 
their families, and there simply are not many jobs out there for which 
they are qualified without training, which is another shortcoming of 
the base bill.
  Coming from a rural district, I know very well that this amendment 
will hit particularly hard because there are an especially limited 
number of new employment opportunities in many small towns and rural 
communities of America.
  This amendment is much more extreme even than the original bill 
passed by the House last year. Under that bill, people who were unable 
to find work could have continued to get food stamps if they 
participated in job search programs. This amendment cuts those people 
off the program and imposes the harshest work requirement of any 
proposal made during this Congress.
  The amendment cannot be said to be toughening the work requirements. 
Such a statement assumes that for every person cut off from food stamps 
there is a job. Common sense tells us that is not the case. If this 
amendment were really intended to put people to work, it would provide 
a number of things, including funding for additional workfare slots. 
But, of course, that would cost money, and this amendment is intended 
to save an additional $2.2 billion. This is just another example of how 
extreme philosophy and this year's budget, not sound policy, are 
driving welfare reform.
  This amendment is bad policy, a paperwork nightmare, and I urge every 
Member to vote against it.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the distinguished 
gentlewoman from North Carolina [Mrs. Clayton].
  Mrs. CLAYTON. Madam Chairman, I rise today in strong opposition to 
the Kasich-Ney amendment.
  I believe that the 4-month time limit presently contained in this 
legislation is egregious. This amendment would further reduce this 
already short period of time by 30 days.
  According to data collected by USDA, three-fourths of able-bodied, 
nonelderly food stamp recipients leave within 9 months because they 
have found a job or another alternative means to augment their income, 
but over one-half of those people need more than 4 months to do so.

[[Page H7905]]

  Even our current unemployment compensation system acknowledges that 
people need about 6 months to find a job.
  That is why I offered an amendment, albeit unsuccessful, during the 
Agriculture Committee consideration of the food stamp title to increase 
the limit from 4 months to 6 months, which is consistent with last 
year's Senate welfare reform package.
  The Congressional Budget Office has estimated that 700,000 unemployed 
people who are willing to work and willing to comply with the tenets of 
a work program would be denied food stamp assistance under the 4-month 
ceiling contained in H.R. 3734, whereas under the 6-month scenario of 
my amendment only 450,000 workers would be cut off.
  If the proposed 120-day limit is shortened further to 90 days, 90 
days, close to 1 million Americans will be denied food stamp 
assistance, 1 million of the poorest of the poor.
  Madam Chairman, the majority must be credited here for the inclusion 
of the 4-month bridge, which is not as long as I would like it to be, 
but it is far better than the 3-month ceiling that this punitive 
amendment seeks to introduce.
  Thirty days, Madam Chairman; imagine not eating for 30 days? That is 
the reality that some poor Americans who are actively looking for work 
will have to face, if the Kasich-Ney amendment passes. Is the small 
budget reduction gained by this proposal worth the large loss of food 
assistance, sustenance if my colleagues will, to those 1 million 
Americans denied assistance under a 90-day ceiling?

                              {time}  1330

  Mr. NEY. Madam Chairman, I yield 3 minutes to my colleague, the 
gentleman from Ohio [Mr. Kasich].
  Mr. KASICH. Madam Chairman, let me make clear what the amendment does 
so that there is no confusion. If you are able-bodied, single, between 
the ages of 18 and 50 and you get food stamps, we are saying you have 
to work 20 hours a week. It is no more complicated than that. If you 
cannot get a job, you go in a workfare program; 45 out of 50 States 
have a workfare program.
  Let me just suggest to the Members, if there is any program that 
Americans who go to work are frustrated about, it is food stamps. They 
get frustrated to stand in line at the grocery store and just observe 
what goes on and the way in which people buy. They think people are 
trading them, they think there is a lot of fraud involved in the 
program. The American people, while supporting a food stamp program, 
they want the food stamp program cleaned up, tightened up, and fixed 
and reformed.
  Madam Chairman, what this amendment says is that if you need to get 
food stamps and you are single, you are able-bodied, you are between 
the ages of 18 and 50, you have to do some work in exchange for the 
food stamps.
  The opposition to this amendment, frankly, is opposed to the very 
premises that underlie our bill, our welfare bill. Our welfare bill 
says at some point you have to get trained, you have to go to work. You 
have to get off the system and get a job.
  What this amendment says is very simple. If your people at home are 
frustrated about food stamps, this amendment does not take away food 
stamps. It says, though, if you are going to get food stamps, you are 
going to work 20 hours a week; 20 hours a week.
  If you cannot find a job, you go to work for the State in a workfare 
program, and maybe you whitewash the graffiti, or maybe you clean up 
the neighborhood, but you participate in a program where you do some 
work in exchange, in exchange for the food stamps that you get.
  Madam Chairman, it is not complicated. There is not a reason that I 
can think of as to why you should not be able to put in 20 hours a week 
if you are able-bodied, between the age of 18 to 50, in exchange for 
that program.
  I would say to the House, think about this. If my colleagues support 
the underlying parts of this bill that call for people to work, that 
call for people to get trained, then clearly they support this concept. 
We are not asking people to work overly generous hours. In fact, there 
is already a requirement that says you have to work 8 months out of the 
year. What we say is we will give you a little exemption up front for 3 
months, you have your 3 months, but after that if you need the food 
stamps you have to put in a little bit of work.
  I think that is fair for the people who get the food stamps, and I 
think it is eminently reasonable and fair for the people that pay the 
bills for those who get the food stamps.
  Support the Ney amendment.
  Mr. SABO. Madam Chairman, I yield 2 minutes to the gentleman from 
Michigan [Mr. Levin].
  Mr. LEVIN. Madam Chairman, I want to tell the gentleman from Ohio I 
fully share, and indeed I have worked hard for the concept, off of 
welfare and into work, with time limits. But this amendment goes far 
beyond it.
  Take the State of Michigan in the early 1980's. We had unemployment 
rising for 3 years in a row. We had about 115,000 more people on food 
stamps. In the Detroit metropolitan area, unemployment did not hit the 
10 percent mark at any point.
  So what about people, able bodied, who have been working all their 
lives, who are thrown out on the streets because there is no work? They 
had been on food stamps for 3 months 10 years earlier. What the 
gentleman is saying to those people: Starve. Oh, Members say all they 
have to do is get a job through workfare. Is there a workfare program 
in Michigan for 50,000 people or 100,000 people thrown out of work in a 
recession? Of course there is not.
  I believe unequivocally people on welfare, able bodied, get to work 
with the adequate support protections in Castle-Tanner. What I do not 
say is to the hard-working person, with or without kids, if you cannot 
find a job, if you are working hard, looking hard to find one, we are 
going to say you starve, because 10 years ago you were on food stamps 
for 3 months.
  Yes, Madam Chairman, I think this shows the difference between the 
two bills. They just insist on thinking tough means mean. I think tough 
means getting people off of welfare to work, but not hurting the hard-
working person who hits hard times.
  Vote against this amendment. It has been considered in the Senate 
before and rejected, across the board, on a bipartisan basis. This 
violates the spirit of getting tough on work but not being mean to kids 
or mean to anybody else.
  Mr. NEY. Madam Chairman, I yield myself the balance of my time.
  The CHAIRMAN. The gentleman from Ohio [Mr. Ney] is recognized for 2 
minutes.
  Mr. NEY. Madam Chairman, let me make this point very clear. This does 
not apply to children. Let me read the exemptions once again: Anyone 
under 18 years old or over 50, this does not apply to them. Anyone 
medically certified as physically or mentally incapable or unfit for 
employment, it does not apply to them. A parent or other member of a 
household responsible for a dependent child, it does not apply to them. 
A pregnant woman, it does not apply to her.
  Also, if the gentleman wants to talk about unemployment, if we read 
the text, there are hardship exemptions. It can be waived. There are 
safeguards in this. The bottom line is it saves $2.2 billion on the 
fiscal side, but the real bottom line is it is responsible. It is a 
good amendment. It is fair. It is an amendment, and I cannot even 
believe some of the statements I have heard about this amendment. It is 
a very responsible amendment.
  Mr. KASICH. Madam Chairman, will the gentleman yield?
  Mr. NEY. I yield to the gentleman from Ohio.
  Mr. KASICH. In other words, Madam Chairman, if you are under the age 
of 18 or over the age of 50, this does not apply to you. Only if you 
are childless and able-bodied and if there is an unemployment rate over 
10 percent, it can be waived, is that correct? So if you have high 
unemployment or if you have children or if you are sick, it does not 
apply. It is only if you are able-bodied, if you are childless, and you 
live in an area where you are getting food stamps and there are jobs 
available, then it applies.
  So if you are able-bodied and there are jobs available, you go and 
you have to work 20 hours to get your food stamps. Then of course if 
you cannot find a job then you do workfare. That is what it is. But 
there are a number of exemptions in here for people who find themselves 
in particularly difficult circumstances and in a State with high

[[Page H7906]]

unemployment. Or you can be in job training. They can go to job 
training.
  Mr. NEY. The gentleman is correct. It just means you simply have to 
work, just like everyone else. This is responsible, it is fair, it has 
exemptions. I urge support of the amendment.
  Mr. SABO. Madam Chairman, I yield 45 seconds to the gentleman from 
North Carolina [Mr. Hefner].
  Mr. HEFNER. Madam Chairman, I guess I do not understand what the 
gentleman talks about, asking about a waiver. How would you get that? 
Would it have to do with the percentage of unemployment in this 
district?
  I have been in this place for 22 years. I have seen some mean-
spirited amendments in this place. To me this is the most mean-spirited 
amendment that I have ever seen on any bill that has come before this 
House. If this is what you have to do to get reelected to this 
Congress, I do not want to be a part of this body any longer if I have 
to vote for such mean-spirited legislation as this. It is not worth it 
to be in this most deliberative body in the world. I do not think it 
speaks well for this body as a whole to accept a mean-spirited 
amendment like this. It is degrading.
  Mr. SABO. Madam Chairman, I yield the balance of my time to the 
gentlewoman from Florida [Mrs. Thurman].
  The CHAIRMAN. The gentlewoman from Florida [Mrs. Thurman] is 
recognized for 2 minutes.
  Mrs. THURMAN. Madam Chairman, I have to tell the Members, I am 
shocked at this attempt one more time to further erode one of the few 
protections we have for laidoff and downsized employees in America. The 
Kasich-Ney amendment actually penalizes people who play by the rules 
and do exactly what we want people on welfare to do: find a job.
  Someone who loses her job during a recession is often forced to turn 
to food stamp assistance to meet her basic needs. If this person acts 
responsibly and finds a new job within 3 short months, she should not 
be disqualified, yes, for the rest of her adult years, from further 
food stamp assistance. If 10 years later this welfare success story is 
downsized, as so many people in modern America have been, the Kasich-
Ney amendment would deny her the temporary assistance needed for her to 
get back into the job market.
  Why? Because it is about money, not policy. Good policy would be to 
reinforce the goal of moving people to work instead of offering an 
amendment that penalizes people who are trying to fulfill that goal. I 
sit on the Committee on Agriculture in the House. No one came before 
our committee to offer this amendment. In fact, we had a discussion 
about how the 4-month time limit in the majority's bill was unrealistic 
if job slots are not available.
  I was actually encouraged by the conversation and believed we may 
have been able to reach a compromise on this issue. Now, all of a 
sudden, an amendment surfaces to not only cut back the time limit to 3 
months, but to prohibit 18- to 50-year-olds from any further food 
assistance. The logic escapes me. Is it not the people that we want to 
work that we are trying to help? This amendment simply is another 
example of money over policy. While the majority may believe that this 
saves them money, the policy is quite costly.
  The CHAIRMAN. All time for debate on this amendment has expired.
  The question is on the amendment offered by the gentleman from Ohio 
[Mr. Ney].
  The question was taken; and the chairman announced that the noes 
appeared to have it.


                             recorded vote

  Mr. NEY. Madam Chairman, I demand a recorded vote.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 239, 
noes 184, not voting 10, as follows:

                             [Roll No 328]

                               AYES--239

     Allard
     Archer
     Armey
     Bachus
     Baesler
     Baker (CA)
     Baker (LA)
     Ballenger
     Barr
     Barrett (NE)
     Bartlett
     Barton
     Bass
     Bateman
     Bereuter
     Bilbray
     Bilirakis
     Bliley
     Boehner
     Bonilla
     Bono
     Browder
     Brownback
     Bryant (TN)
     Bunning
     Burr
     Burton
     Buyer
     Callahan
     Calvert
     Camp
     Campbell
     Canady
     Chabot
     Chambliss
     Chenoweth
     Christensen
     Chrysler
     Clement
     Clinger
     Coble
     Coburn
     Collins (GA)
     Combest
     Cooley
     Cox
     Cramer
     Crane
     Crapo
     Cremeans
     Cubin
     Cunningham
     Danner
     Deal
     DeLay
     Diaz-Balart
     Dickey
     Dornan
     Dreier
     Duncan
     Dunn
     Ehlers
     Ehrlich
     English
     Ensign
     Everett
     Ewing
     Fawell
     Fields (TX)
     Flanagan
     Foley
     Fowler
     Fox
     Franks (CT)
     Franks (NJ)
     Frelinghuysen
     Frisa
     Funderburk
     Furse
     Gallegly
     Ganske
     Gekas
     Geren
     Gilchrest
     Gillmor
     Goodlatte
     Goodling
     Gordon
     Goss
     Graham
     Greene (UT)
     Greenwood
     Gunderson
     Gutknecht
     Hall (TX)
     Hamilton
     Hancock
     Hansen
     Hastert
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Heineman
     Herger
     Hilleary
     Hobson
     Hoekstra
     Hoke
     Holden
     Horn
     Hostettler
     Hunter
     Hutchinson
     Hyde
     Inglis
     Istook
     Johnson (SD)
     Johnson, Sam
     Jones
     Kasich
     Kelly
     Kim
     King
     Kingston
     Klug
     Knollenberg
     Kolbe
     LaHood
     Largent
     Latham
     LaTourette
     Laughlin
     Lazio
     Leach
     Lewis (CA)
     Lewis (KY)
     Lightfoot
     Linder
     Lipinski
     Livingston
     LoBiondo
     Longley
     Lucas
     Manzullo
     Martini
     McCollum
     McCrery
     McHale
     McHugh
     McInnis
     McIntosh
     McKeon
     Metcalf
     Meyers
     Mica
     Miller (FL)
     Molinari
     Moorhead
     Moran
     Myers
     Myrick
     Neumann
     Ney
     Norwood
     Nussle
     Oxley
     Parker
     Paxon
     Peterson (MN)
     Petri
     Pombo
     Porter
     Portman
     Poshard
     Pryce
     Quillen
     Radanovich
     Ramstad
     Regula
     Richardson
     Riggs
     Roberts
     Roemer
     Rogers
     Rohrabacher
     Ros-Lehtinen
     Roth
     Royce
     Salmon
     Sanford
     Saxton
     Schaefer
     Seastrand
     Sensenbrenner
     Shadegg
     Shaw
     Shuster
     Sisisky
     Skeen
     Skelton
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Smith (WA)
     Solomon
     Souder
     Spence
     Stearns
     Stockman
     Stump
     Talent
     Tate
     Tauzin
     Taylor (MS)
     Taylor (NC)
     Thomas
     Thornberry
     Tiahrt
     Torkildsen
     Traficant
     Upton
     Visclosky
     Vucanovich
     Walker
     Wamp
     Ward
     Watts (OK)
     Weldon (FL)
     Weldon (PA)
     Weller
     White
     Whitfield
     Wicker
     Williams
     Wolf
     Young (AK)
     Zeliff
     Zimmer

                               NOES--184

     Abercrombie
     Ackerman
     Andrews
     Baldacci
     Barcia
     Barrett (WI)
     Becerra
     Beilenson
     Bentsen
     Berman
     Bevill
     Bishop
     Blumenauer
     Blute
     Boehlert
     Bonior
     Borski
     Boucher
     Brewster
     Brown (CA)
     Brown (FL)
     Brown (OH)
     Bryant (TX)
     Bunn
     Cardin
     Castle
     Chapman
     Clay
     Clayton
     Clyburn
     Coleman
     Collins (IL)
     Collins (MI)
     Condit
     Conyers
     Costello
     Coyne
     Cummings
     Davis
     DeFazio
     DeLauro
     Dellums
     Deutsch
     Dicks
     Dingell
     Dixon
     Doggett
     Dooley
     Doyle
     Durbin
     Edwards
     Engel
     Eshoo
     Evans
     Farr
     Fattah
     Fazio
     Fields (LA)
     Filner
     Flake
     Foglietta
     Ford
     Frank (MA)
     Frost
     Gejdenson
     Gephardt
     Gibbons
     Gilman
     Gonzalez
     Green (TX)
     Gutierrez
     Hall (OH)
     Harman
     Hastings (FL)
     Hefner
     Hilliard
     Hinchey
     Houghton
     Hoyer
     Jackson (IL)
     Jackson-Lee (TX)
     Jacobs
     Jefferson
     Johnson (CT)
     Johnson, E. B.
     Johnston
     Kanjorski
     Kaptur
     Kennedy (MA)
     Kennedy (RI)
     Kennelly
     Kildee
     Kleczka
     Klink
     LaFalce
     Lantos
     Levin
     Lewis (GA)
     Lofgren
     Lowey
     Luther
     Maloney
     Manton
     Markey
     Martinez
     Mascara
     Matsui
     McCarthy
     McDermott
     McKinney
     McNulty
     Meehan
     Meek
     Menendez
     Millender-McDonald
     Minge
     Mink
     Moakley
     Mollohan
     Montgomery
     Morella
     Murtha
     Nadler
     Neal
     Nethercutt
     Oberstar
     Obey
     Olver
     Ortiz
     Orton
     Owens
     Pallone
     Pastor
     Payne (NJ)
     Payne (VA)
     Pelosi
     Peterson (FL)
     Pickett
     Pomeroy
     Quinn
     Rahall
     Rangel
     Reed
     Rivers
     Rose
     Roukema
     Roybal-Allard
     Rush
     Sabo
     Sanders
     Sawyer
     Schroeder
     Schumer
     Scott
     Serrano
     Shays
     Skaggs
     Slaughter
     Spratt
     Stark
     Stenholm
     Stokes
     Studds
     Stupak
     Tanner
     Tejeda
     Thompson
     Thornton
     Thurman
     Torres
     Torricelli
     Towns
     Velazquez
     Vento
     Volkmer
     Walsh
     Waters
     Watt (NC)
     Waxman
     Wilson
     Wise
     Woolsey
     Wynn
     Yates

                             NOT VOTING--10

     de la Garza
     Doolittle
     Forbes
     Lincoln
     McDade
     Miller (CA)
     Packard
     Scarborough
     Schiff
     Young (FL)

                              {time}  1401

  The Clerk announced the following pair:
  On this vote:

       Mr. Forbes for, with Mrs. Lincoln against.


[[Page H7907]]


  Messrs. NADLER, DEUTSCH, and SHAYS, and Mrs. JOHNSON of Connecticut 
changed their vote from ``aye'' to ``no.''
  Mr. PETERSON of Minnesota, Mrs. KELLY, and Mr. JOHNSON of South 
Dakota changed their vote from ``no'' to ``aye.''
  So the amendment was agreed to.
  The result of the vote was announced as above recorded.


                          personal explanation

  Mr. SCARBOROUGH. Madam Chairman, on rollcall No. 328, I was detained 
at a meeting. Had I been present, I would have voted ``aye.''
  Mr. SHAW. Mr. Chairman, I move that the Committee do now rise.
  The motion was agreed to.
  Accordingly the Committee rose; and the Speaker pro tempore (Mr. 
Upton) having assumed the chair, Ms. Greene of Utah, Chairman of the 
Committee of the Whole House on the State of the Union, reported that 
that Committee, having had under consideration the bill (H.R. 3734) to 
provide for reconciliation pursuant to section 201(a)(1) of the 
concurrent resolution on the budget for fiscal year 1997, had come to 
no resolution thereon.

                          ____________________