[Congressional Record Volume 144, Number 86 (Friday, June 26, 1998)]
[Senate]
[Pages S7306-S7323]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          CHILD SUPPORT PERFORMANCE AND INCENTIVE ACT OF 1998

  Mr. LOTT. Mr. President, I ask unanimous consent the Chair lay before 
the Senate a message from the House of Representatives on the bill 
(H.R. 3130) to provide for an alternative penalty procedure for States 
that fail to meet Federal child support data processing requirements, 
to reform Federal incentive payments for effective child support 
performance, and to provide for a more flexible penalty procedure for 
States that violate interjurisdictional adoption requirements.
  The PRESIDING OFFICER laid before the Senate the following message 
from the House of Representatives:

       Resolved, That the House agree to the amendments of the 
     Senate to the bill (H.R. 3130) entitled ``An Act to provide 
     for an alternative penalty procedure for States that fail to 
     meet Federal child support data processing requirements, to 
     reform Federal incentive payments for effective child support 
     performance, to provide for a more flexible penalty procedure 
     for States that violate interjurisdictional adoption 
     requirements, to amend the Immigration and Nationality Act to 
     make certain aliens determined to be delinquent in the 
     payment of child support inadmissible and ineligible for 
     naturalization, and for other purposes'', with the following 
     amendments:
       Strike out all after the enacting clause and insert:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Child Support Performance 
     and Incentive Act of 1998''.

     SEC. 2. TABLE OF CONTENTS.

       The table of contents of this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.

          TITLE I--CHILD SUPPORT DATA PROCESSING REQUIREMENTS

Sec. 101. Alternative penalty procedure.
Sec. 102. Authority to waive single statewide automated data processing 
              and information retrieval system requirement.

                TITLE II--CHILD SUPPORT INCENTIVE SYSTEM

Sec. 201. Incentive payments to States.

                     TITLE III--ADOPTION PROVISIONS

Sec. 301. More flexible penalty procedure to be applied for failing to 
              permit interjurisdictional adoption.

                        TITLE IV--MISCELLANEOUS

Sec. 401. Elimination of barriers to the effective establishment and 
              enforcement of medical child support.
Sec. 402. Safeguard of new employee information.
Sec. 403. Limitations on use of TANF funds for matching under certain 
              Federal transportation program.
Sec. 404. Clarification of meaning of high-volume automated 
              administrative enforcement of child support in interstate 
              cases.
Sec. 405. General Accounting Office reports.
Sec. 406. Data matching by multistate financial institutions.
Sec. 407. Elimination of unnecessary data reporting.
Sec. 408. Clarification of eligibility under welfare-to-work programs.
Sec. 409. Study of feasibility of implementing immigration provisions 
              of H.R. 3130, as passed by the House of Representatives 
              on March 5, 1998.
Sec. 410. Technical corrections.
          TITLE I--CHILD SUPPORT DATA PROCESSING REQUIREMENTS

     SEC. 101. ALTERNATIVE PENALTY PROCEDURE.

       (a) In General.--Section 455(a) of the Social Security Act 
     (42 U.S.C. 655(a)) is amended by adding at the end the 
     following:
       ``(4)(A)(i) If--
       ``(I) the Secretary determines that a State plan under 
     section 454 would (in the absence of this paragraph) be 
     disapproved for the failure of the State to comply with a 
     particular subparagraph of section 454(24), and that the 
     State has made and is continuing to make a good faith effort 
     to so comply; and
       ``(II) the State has submitted to the Secretary a 
     corrective compliance plan that describes how, by when, and 
     at what cost the State will achieve such compliance, which 
     has been approved by the Secretary,
     then the Secretary shall not disapprove the State plan under 
     section 454, and the Secretary

[[Page S7307]]

     shall reduce the amount otherwise payable to the State under 
     paragraph (1)(A) of this subsection for the fiscal year by 
     the penalty amount.
       ``(ii) All failures of a State during a fiscal year to 
     comply with any of the requirements referred to in the same 
     subparagraph of section 454(24) shall be considered a single 
     failure of the State to comply with that subparagraph during 
     the fiscal year for purposes of this paragraph.
       ``(B) In this paragraph:
       ``(i) The term `penalty amount' means, with respect to a 
     failure of a State to comply with a subparagraph of section 
     454(24)--
       ``(I) 4 percent of the penalty base, in the case of the 1st 
     fiscal year in which such a failure by the State occurs 
     (regardless of whether a penalty is imposed under this 
     paragraph with respect to the failure);
       ``(II) 8 percent of the penalty base, in the case of the 
     2nd such fiscal year;
       ``(III) 16 percent of the penalty base, in the case of the 
     3rd such fiscal year;
       ``(IV) 25 percent of the penalty base, in the case of the 
     4th such fiscal year; or
       ``(V) 30 percent of the penalty base, in the case of the 
     5th or any subsequent such fiscal year.
       ``(ii) The term `penalty base' means, with respect to a 
     failure of a State to comply with a subparagraph of section 
     454(24) during a fiscal year, the amount otherwise payable to 
     the State under paragraph (1)(A) of this subsection for the 
     preceding fiscal year.
       ``(C)(i) The Secretary shall waive a penalty under this 
     paragraph for any failure of a State to comply with section 
     454(24)(A) during fiscal year 1998 if--
       ``(I) on or before August 1, 1998, the State has submitted 
     to the Secretary a request that the Secretary certify the 
     State as having met the requirements of such section;
       ``(II) the Secretary subsequently provides the 
     certification as a result of a timely review conducted 
     pursuant to the request; and
       ``(III) the State has not failed such a review.
       ``(ii) If a State with respect to which a reduction is made 
     under this paragraph for a fiscal year with respect to a 
     failure to comply with a subparagraph of section 454(24) 
     achieves compliance with such subparagraph by the beginning 
     of the succeeding fiscal year, the Secretary shall increase 
     the amount otherwise payable to the State under paragraph 
     (1)(A) of this subsection for the succeeding fiscal year by 
     an amount equal to 90 percent of the reduction for the fiscal 
     year.
       ``(D) The Secretary may not impose a penalty under this 
     paragraph against a State with respect to a failure to comply 
     with section 454(24)(B) for a fiscal year if the Secretary is 
     required to impose a penalty under this paragraph against the 
     State with respect to a failure to comply with section 
     454(24)(A) for the fiscal year.''.
       (b) Inapplicability of Penalty Under TANF Program.--Section 
     409(a)(8)(A)(i)(III) of such Act (42 U.S.C. 
     609(a)(8)(A)(i)(III)) is amended by inserting ``(other than 
     section 454(24))'' before the semicolon.

     SEC. 102. AUTHORITY TO WAIVE SINGLE STATEWIDE AUTOMATED DATA 
                   PROCESSING AND INFORMATION RETRIEVAL SYSTEM 
                   REQUIREMENT.

       (a) In General.--Section 452(d)(3) of the Social Security 
     Act (42 U.S.C. 652(d)(3)) is amended to read as follows:
       ``(3) The Secretary may waive any requirement of paragraph 
     (1) or any condition specified under section 454(16), and 
     shall waive the single statewide system requirement under 
     sections 454(16) and 454A, with respect to a State if--
       ``(A) the State demonstrates to the satisfaction of the 
     Secretary that the State has or can develop an alternative 
     system or systems that enable the State--
       ``(i) for purposes of section 409(a)(8), to achieve the 
     paternity establishment percentages (as defined in section 
     452(g)(2)) and other performance measures that may be 
     established by the Secretary;
       ``(ii) to submit data under section 454(15)(B) that is 
     complete and reliable;
       ``(iii) to substantially comply with the requirements of 
     this part; and
       ``(iv) in the case of a request to waive the single 
     statewide system requirement, to--
       ``(I) meet all functional requirements of sections 454(16) 
     and 454A;
       ``(II) ensure that calculation of distributions meets the 
     requirements of section 457 and accounts for distributions to 
     children in different families or in different States or sub-
     State jurisdictions, and for distributions to other States;
       ``(III) ensure that there is only 1 point of contact in the 
     State which provides seamless case processing for all 
     interstate case processing and coordinated, automated 
     intrastate case management;
       ``(IV) ensure that standardized data elements, forms, and 
     definitions are used throughout the State;
       ``(V) complete the alternative system in no more time than 
     it would take to complete a single statewide system that 
     meets such requirement; and
       ``(VI) process child support cases as quickly, efficiently, 
     and effectively as such cases would be processed through a 
     single statewide system that meets such requirement;
       ``(B)(i) the waiver meets the criteria of paragraphs (1), 
     (2), and (3) of section 1115(c); or
       ``(ii) the State provides assurances to the Secretary that 
     steps will be taken to otherwise improve the State's child 
     support enforcement program; and
       ``(C) in the case of a request to waive the single 
     statewide system requirement, the State has submitted to the 
     Secretary separate estimates of the total cost of a single 
     statewide system that meets such requirement, and of any such 
     alternative system or systems, which shall include estimates 
     of the cost of developing and completing the system and of 
     operating and maintaining the system for 5 years, and the 
     Secretary has agreed with the estimates.''.
       (b) Payments to States.--Section 455(a)(1) of such Act (42 
     U.S.C. 655(a)(1)) is amended--
       (1) by striking ``and'' at the end of subparagraph (B);
       (2) by striking the semicolon at the end of subparagraph 
     (C) and inserting ``, and''; and
       (3) by inserting after subparagraph (C) the following:
       ``(D) equal to 66 percent of the sums expended by the State 
     during the quarter for an alternative statewide system for 
     which a waiver has been granted under section 452(d)(3), but 
     only to the extent that the total of the sums so expended by 
     the State on or after the date of the enactment of this 
     subparagraph does not exceed the least total cost estimate 
     submitted by the State pursuant to section 452(d)(3)(C) in 
     the request for the waiver;''.
                TITLE II--CHILD SUPPORT INCENTIVE SYSTEM

     SEC. 201. INCENTIVE PAYMENTS TO STATES.

       (a) In General.--Part D of title IV of the Social Security 
     Act (42 U.S.C. 651-669) is amended by inserting after section 
     458 the following:

     ``SEC. 458A. INCENTIVE PAYMENTS TO STATES.

       ``(a) In General.--In addition to any other payment under 
     this part, the Secretary shall, subject to subsection (f), 
     make an incentive payment to each State for each fiscal year 
     in an amount determined under subsection (b).
       ``(b) Amount of Incentive Payment.--
       ``(1) In general.--The incentive payment for a State for a 
     fiscal year is equal to the incentive payment pool for the 
     fiscal year, multiplied by the State incentive payment share 
     for the fiscal year.
       ``(2) Incentive payment pool.--
       ``(A) In general.--In paragraph (1), the term `incentive 
     payment pool' means--
       ``(i) $422,000,000 for fiscal year 2000;
       ``(ii) $429,000,000 for fiscal year 2001;
       ``(iii) $450,000,000 for fiscal year 2002;
       ``(iv) $461,000,000 for fiscal year 2003;
       ``(v) $454,000,000 for fiscal year 2004;
       ``(vi) $446,000,000 for fiscal year 2005;
       ``(vii) $458,000,000 for fiscal year 2006;
       ``(viii) $471,000,000 for fiscal year 2007;
       ``(ix) $483,000,000 for fiscal year 2008; and
       ``(x) for any succeeding fiscal year, the amount of the 
     incentive payment pool for the fiscal year that precedes such 
     succeeding fiscal year, multiplied by the percentage (if any) 
     by which the CPI for such preceding fiscal year exceeds the 
     CPI for the 2nd preceding fiscal year.
       ``(B) CPI.--For purposes of subparagraph (A), the CPI for a 
     fiscal year is the average of the Consumer Price Index for 
     the 12-month period ending on September 30 of the fiscal 
     year. As used in the preceding sentence, the term `Consumer 
     Price Index' means the last Consumer Price Index for all-
     urban consumers published by the Department of Labor.
       ``(3) State incentive payment share.--In paragraph (1), the 
     term `State incentive payment share' means, with respect to a 
     fiscal year--
       ``(A) the incentive base amount for the State for the 
     fiscal year; divided by
       ``(B) the sum of the incentive base amounts for all of the 
     States for the fiscal year.
       ``(4) Incentive base amount.--In paragraph (3), the term 
     `incentive base amount' means, with respect to a State and a 
     fiscal year, the sum of the applicable percentages 
     (determined in accordance with paragraph (6)) multiplied by 
     the corresponding maximum incentive base amounts for the 
     State for the fiscal year, with respect to each of the 
     following measures of State performance for the fiscal year:
       ``(A) The paternity establishment performance level.
       ``(B) The support order performance level.
       ``(C) The current payment performance level.
       ``(D) The arrearage payment performance level.
       ``(E) The cost-effectiveness performance level.
       ``(5) Maximum incentive base amount.--
       ``(A) In general.--For purposes of paragraph (4), the 
     maximum incentive base amount for a State for a fiscal year 
     is--
       ``(i) with respect to the performance measures described in 
     subparagraphs (A), (B), and (C) of paragraph (4), the State 
     collections base for the fiscal year; and
       ``(ii) with respect to the performance measures described 
     in subparagraphs (D) and (E) of paragraph (4), 75 percent of 
     the State collections base for the fiscal year.
       ``(B) Data required to be complete and reliable.--
     Notwithstanding subparagraph (A), the maximum incentive base 
     amount for a State for a fiscal year with respect to a 
     performance measure described in paragraph (4) is zero, 
     unless the Secretary determines, on the basis of an audit 
     performed under section 452(a)(4)(C)(i), that the data which 
     the State submitted pursuant to section 454(15)(B) for the 
     fiscal year and which is used to determine the performance 
     level involved is complete and reliable.
       ``(C) State collections base.--For purposes of subparagraph 
     (A), the State collections base for a fiscal year is equal to 
     the sum of--
       ``(i) 2 times the sum of--

       ``(I) the total amount of support collected during the 
     fiscal year under the State plan approved under this part in 
     cases in which the support obligation involved is required to 
     be assigned to the State pursuant to part A or E of this 
     title or title XIX; and
       ``(II) the total amount of support collected during the 
     fiscal year under the State plan approved under this part in 
     cases in which the support obligation involved was so 
     assigned but, at the time of collection, is not required to 
     be so assigned; and

       ``(ii) the total amount of support collected during the 
     fiscal year under the State plan approved under this part in 
     all other cases.

[[Page S7308]]

       ``(6) Determination of applicable percentages based on 
     performance levels.--
       ``(A) Paternity establishment.--
       ``(i) Determination of paternity establishment performance 
     level.--The paternity establishment performance level for a 
     State for a fiscal year is, at the option of the State, the 
     IV-D paternity establishment percentage determined under 
     section 452(g)(2)(A) or the statewide paternity establishment 
     percentage determined under section 452(g)(2)(B).
       ``(ii) Determination of applicable percentage.--The 
     applicable percentage with respect to a State's paternity 
     establishment performance level is as follows:

------------------------------------------------------------------------
  ``If the paternity establishment performance level is:         The
-----------------------------------------------------------  applicable
                                                But less     percentage
                  At least:                       than:          is:
------------------------------------------------------------------------
80%.........................................  ............          100
79%.........................................          80%            98
78%.........................................          79%            96
77%.........................................          78%            94
76%.........................................          77%            92
75%.........................................          76%            90
74%.........................................          75%            88
73%.........................................          74%            86
72%.........................................          73%            84
71%.........................................          72%            82
70%.........................................          71%            80
69%.........................................          70%            79
68%.........................................          69%            78
67%.........................................          68%            77
66%.........................................          67%            76
65%.........................................          66%            75
64%.........................................          65%            74
63%.........................................          64%            73
62%.........................................          63%            72
61%.........................................          62%            71
60%.........................................          61%            70
59%.........................................          60%            69
58%.........................................          59%            68
57%.........................................          58%            67
56%.........................................          57%            66
55%.........................................          56%            65
54%.........................................          55%            64
53%.........................................          54%            63
52%.........................................          53%            62
51%.........................................          52%            61
50%.........................................          51%            60
0%..........................................          50%            0.
------------------------------------------------------------------------

     Notwithstanding the preceding sentence, if the paternity 
     establishment performance level of a State for a fiscal year 
     is less than 50 percent but exceeds by at least 10 percentage 
     points the paternity establishment performance level of the 
     State for the immediately preceding fiscal year, then the 
     applicable percentage with respect to the State's paternity 
     establishment performance level is 50 percent.
       ``(B) Establishment of child support orders.--
       ``(i) Determination of support order performance level.--
     The support order performance level for a State for a fiscal 
     year is the percentage of the total number of cases under the 
     State plan approved under this part in which there is a 
     support order during the fiscal year.
       ``(ii) Determination of applicable percentage.--The 
     applicable percentage with respect to a State's support order 
     performance level is as follows:

------------------------------------------------------------------------
       ``If the support order performance level is:              The
-----------------------------------------------------------  applicable
                                                But less     percentage
                  At least:                       than:          is:
------------------------------------------------------------------------
80%.........................................  ............          100
79%.........................................          80%            98
78%.........................................          79%            96
77%.........................................          78%            94
76%.........................................          77%            92
75%.........................................          76%            90
74%.........................................          75%            88
73%.........................................          74%            86
72%.........................................          73%            84
71%.........................................          72%            82
70%.........................................          71%            80
69%.........................................          70%            79
68%.........................................          69%            78
67%.........................................          68%            77
66%.........................................          67%            76
65%.........................................          66%            75
64%.........................................          65%            74
63%.........................................          64%            73
62%.........................................          63%            72
61%.........................................          62%            71
60%.........................................          61%            70
59%.........................................          60%            69
58%.........................................          59%            68
57%.........................................          58%            67
56%.........................................          57%            66
55%.........................................          56%            65
54%.........................................          55%            64
53%.........................................          54%            63
52%.........................................          53%            62
51%.........................................          52%            61
50%.........................................          51%            60
0%..........................................          50%            0.
------------------------------------------------------------------------

     Notwithstanding the preceding sentence, if the support order 
     performance level of a State for a fiscal year is less than 
     50 percent but exceeds by at least 5 percentage points the 
     support order performance level of the State for the 
     immediately preceding fiscal year, then the applicable 
     percentage with respect to the State's support order 
     performance level is 50 percent.
       ``(C) Collections on current child support due.--
       ``(i) Determination of current payment performance level.--
     The current payment performance level for a State for a 
     fiscal year is equal to the total amount of current support 
     collected during the fiscal year under the State plan 
     approved under this part divided by the total amount of 
     current support owed during the fiscal year in all cases 
     under the State plan, expressed as a percentage.
       ``(ii) Determination of applicable percentage.--The 
     applicable percentage with respect to a State's current 
     payment performance level is as follows:

------------------------------------------------------------------------
      ``If the current payment performance level is:             The
-----------------------------------------------------------  applicable
                                                But less     percentage
                  At least:                       than:          is:
------------------------------------------------------------------------
80%.........................................  ............          100
79%.........................................          80%            98
78%.........................................          79%            96
77%.........................................          78%            94
76%.........................................          77%            92
75%.........................................          76%            90
74%.........................................          75%            88
73%.........................................          74%            86
72%.........................................          73%            84
71%.........................................          72%            82
70%.........................................          71%            80
69%.........................................          70%            79
68%.........................................          69%            78
67%.........................................          68%            77
66%.........................................          67%            76
65%.........................................          66%            75
64%.........................................          65%            74
63%.........................................          64%            73
62%.........................................          63%            72
61%.........................................          62%            71
60%.........................................          61%            70
59%.........................................          60%            69
58%.........................................          59%            68
57%.........................................          58%            67
56%.........................................          57%            66
55%.........................................          56%            65
54%.........................................          55%            64
53%.........................................          54%            63
52%.........................................          53%            62
51%.........................................          52%            61
50%.........................................          51%            60
49%.........................................          50%            59
48%.........................................          49%            58
47%.........................................          48%            57
46%.........................................          47%            56
45%.........................................          46%            55
44%.........................................          45%            54
43%.........................................          44%            53
42%.........................................          43%            52
41%.........................................          42%            51
40%.........................................          41%            50
0%..........................................          40%            0.
------------------------------------------------------------------------

     Notwithstanding the preceding sentence, if the current 
     payment performance level of a State for a fiscal year is 
     less than 40 percent but exceeds by at least 5 percentage 
     points the current payment performance level of the State for 
     the immediately preceding fiscal year, then the applicable 
     percentage with respect to the State's current payment 
     performance level is 50 percent.
       ``(D) Collections on child support arrearages.--
       ``(i) Determination of arrearage payment performance 
     level.--The arrearage payment performance level for a State 
     for a fiscal year is equal to the total number of cases under 
     the State plan approved under this part in which payments of 
     past-due child support were received during the fiscal year 
     and part or all of the payments were distributed to the 
     family to whom the past-due child support was owed (or, if 
     all past-due child support owed to the family was, at the 
     time of receipt, subject to an assignment to the State, part 
     or all of the payments were retained by the State) divided by 
     the total number of cases under the State plan in which there 
     is past-due child support, expressed as a percentage.
       ``(ii) Determination of applicable percentage.--The 
     applicable percentage with respect to a State's arrearage 
     payment performance level is as follows:

------------------------------------------------------------------------
     ``If the arrearage payment performance level is:            The
-----------------------------------------------------------  applicable
                                                But less     percentage
                  At least:                       than:          is:
------------------------------------------------------------------------
80%.........................................  ............          100
79%.........................................          80%            98
78%.........................................          79%            96
77%.........................................          78%            94
76%.........................................          77%            92
75%.........................................          76%            90
74%.........................................          75%            88
73%.........................................          74%            86
72%.........................................          73%            84
71%.........................................          72%            82
70%.........................................          71%            80
69%.........................................          70%            79
68%.........................................          69%            78
67%.........................................          68%            77
66%.........................................          67%            76
65%.........................................          66%            75
64%.........................................          65%            74
63%.........................................          64%            73
62%.........................................          63%            72
61%.........................................          62%            71
60%.........................................          61%            70
59%.........................................          60%            69
58%.........................................          59%            68
57%.........................................          58%            67
56%.........................................          57%            66
55%.........................................          56%            65
54%.........................................          55%            64
53%.........................................          54%            63
52%.........................................          53%            62
51%.........................................          52%            61
50%.........................................          51%            60
49%.........................................          50%            59
48%.........................................          49%            58
47%.........................................          48%            57
46%.........................................          47%            56
45%.........................................          46%            55
44%.........................................          45%            54
43%.........................................          44%            53
42%.........................................          43%            52
41%.........................................          42%            51
40%.........................................          41%            50
0%..........................................          40%            0.
------------------------------------------------------------------------

     Notwithstanding the preceding sentence, if the arrearage 
     payment performance level of a State for a fiscal year is 
     less than 40 percent but exceeds by at least 5 percentage 
     points the arrearage payment performance level of the State 
     for the immediately preceding fiscal year, then the 
     applicable percentage with respect to the State's arrearage 
     payment performance level is 50 percent.
       ``(E) Cost-effectiveness.--
       ``(i) Determination of cost-effectiveness performance 
     level.--The cost-effectiveness performance level for a State 
     for a fiscal year is equal to the total amount collected 
     during the fiscal year under the State plan approved under 
     this part divided by the total amount expended during the 
     fiscal year under the State plan, expressed as a ratio.
       ``(ii) Determination of applicable percentage.--The 
     applicable percentage with respect to a State's cost-
     effectiveness performance level is as follows:

------------------------------------------------------------------------
     ``If the cost-effectiveness performance level is:           The
-----------------------------------------------------------  applicable
                                                But less     percentage
                  At least:                       than:          is:
------------------------------------------------------------------------
5.00........................................  ............          100
4.50........................................         4.99            90
4.00........................................         4.50            80
3.50........................................         4.00            70
3.00........................................         3.50            60
2.50........................................         3.00            50
2.00........................................         2.50            40
0.00........................................         2.00            0.
------------------------------------------------------------------------


[[Page S7309]]

       ``(c) Treatment of Interstate Collections.--In computing 
     incentive payments under this section, support which is 
     collected by a State at the request of another State shall be 
     treated as having been collected in full by both States, and 
     any amounts expended by a State in carrying out a special 
     project assisted under section 455(e) shall be excluded.
       ``(d) Administrative Provisions.--The amounts of the 
     incentive payments to be made to the States under this 
     section for a fiscal year shall be estimated by the Secretary 
     at or before the beginning of the fiscal year on the basis of 
     the best information available. The Secretary shall make the 
     payments for the fiscal year, on a quarterly basis (with each 
     quarterly payment being made no later than the beginning of 
     the quarter involved), in the amounts so estimated, reduced 
     or increased to the extent of any overpayments or 
     underpayments which the Secretary determines were made under 
     this section to the States involved for prior periods and 
     with respect to which adjustment has not already been made 
     under this subsection. Upon the making of any estimate by the 
     Secretary under the preceding sentence, any appropriations 
     available for payments under this section are deemed 
     obligated.
       ``(e) Regulations.--The Secretary shall prescribe such 
     regulations as may be necessary governing the calculation of 
     incentive payments under this section, including directions 
     for excluding from the calculations certain closed cases and 
     cases over which the States do not have jurisdiction.
       ``(f) Reinvestment.--A State to which a payment is made 
     under this section shall expend the full amount of the 
     payment to supplement, and not supplant, other funds used by 
     the State--
       ``(1) to carry out the State plan approved under this part; 
     or
       ``(2) for any activity (including cost-effective contracts 
     with local agencies) approved by the Secretary, whether or 
     not the expenditures for the activity are eligible for 
     reimbursement under this part, which may contribute to 
     improving the effectiveness or efficiency of the State 
     program operated under this part.''.
       (b) Transition Rule.--Notwithstanding any other provision 
     of law--
       (1) for fiscal year 2000, the Secretary shall reduce by \1/
     3\ the amount otherwise payable to a State under section 458 
     of the Social Security Act, and shall reduce by \2/3\ the 
     amount otherwise payable to a State under section 458A of 
     such Act; and
       (2) for fiscal year 2001, the Secretary shall reduce by \2/
     3\ the amount otherwise payable to a State under section 458 
     of the Social Security Act, and shall reduce by \1/3\ the 
     amount otherwise payable to a State under section 458A of 
     such Act.
       (c) Regulations.--Within 9 months after the date of the 
     enactment of this section, the Secretary of Health and Human 
     Services shall prescribe regulations governing the 
     implementation of section 458A of the Social Security Act 
     when such section takes effect and the implementation of 
     subsection (b) of this section.
       (d) Studies.--
       (1) General review of new incentive payment system.--
       (A) In general.--The Secretary of Health and Human Services 
     shall conduct a study of the implementation of the incentive 
     payment system established by section 458A of the Social 
     Security Act, in order to identify the problems and successes 
     of the system.
       (B) Reports to the congress.--
       (i) Report on variations in state performance attributable 
     to demographic variables.--Not later than October 1, 2000, 
     the Secretary shall submit to the Congress a report that 
     identifies any demographic or economic variables that account 
     for differences in the performance levels achieved by the 
     States with respect to the performance measures used in the 
     system, and contains the recommendations of the Secretary for 
     such adjustments to the system as may be necessary to ensure 
     that the relative performance of States is measured from a 
     baseline that takes account of any such variables.
       (ii) Interim report.--Not later than March 1, 2001, the 
     Secretary shall submit to the Congress an interim report that 
     contains the findings of the study required by subparagraph 
     (A).
       (iii) Final report.--Not later than October 1, 2003, the 
     Secretary shall submit to the Congress a final report that 
     contains the final findings of the study required by 
     subparagraph (A). The report shall include any 
     recommendations for changes in the system that the Secretary 
     determines would improve the operation of the child support 
     enforcement program.
       (2) Development of medical support incentive.--
       (A) In general.--The Secretary of Health and Human 
     Services, in consultation with State directors of programs 
     operated under part D of title IV of the Social Security Act 
     and representatives of children potentially eligible for 
     medical support, shall develop a performance measure based on 
     the effectiveness of States in establishing and enforcing 
     medical support obligations, and shall make recommendations 
     for the incorporation of the measure, in a revenue neutral 
     manner, into the incentive payment system established by 
     section 458A of the Social Security Act.
       (B) Report.--Not later than October 1, 1999, the Secretary 
     shall submit to the Congress a report that describes the 
     performance measure and contains the recommendations required 
     by subparagraph (A).
       (e) Technical Amendments.--
       (1) In general.--Section 341 of the Personal Responsibility 
     and Work Opportunity Reconciliation Act of 1996 (42 U.S.C. 
     658 note) is amended--
       (A) by striking subsection (a) and redesignating 
     subsections (b), (c), and (d) as subsections (a), (b), and 
     (c), respectively; and
       (B) in subsection (c) (as so redesignated)--
       (i) by striking paragraph (1) and inserting the following:
       ``(1) Conforming amendments to present system.--The 
     amendments made by subsection (a) of this section shall 
     become effective with respect to a State as of the date the 
     amendments made by section 103(a) (without regard to section 
     116(a)(2)) first apply to the State.''; and
       (ii) in paragraph (2), by striking ``(c)'' and inserting 
     ``(b)''.
       (2) Effective date.--The amendments made by this subsection 
     shall take effect as if included in the enactment of section 
     341 of the Personal Responsibility and Work Opportunity 
     Reconciliation Act of 1996.
       (f) Elimination of Predecessor Incentive Payment System.--
       (1) Repeal.--Section 458 of the Social Security Act (42 
     U.S.C. 658) is repealed.
       (2) Conforming amendments.--
       (A) Section 458A of the Social Security Act, as added by 
     section 201(a) of this Act, is redesignated as section 458.
       (B) Section 455(a)(4)(C)(iii) of such Act (42 U.S.C. 
     655(a)(4)(C)(iii)), as added by section 101(a) of this Act, 
     is amended--
       (i) by striking ``458A(b)(4)'' and inserting ``458(b)(4)'';
       (ii) by striking ``458A(b)(6)'' and inserting 
     ``458(b)(6)''; and
       (iii) by striking ``458A(b)(5)(B)'' and inserting 
     ``458(b)(5)(B)''.
       (C) Subsection (d)(1) of this section is amended by 
     striking ``458A'' and inserting ``458''.
       (3) Effective date.--The amendments made by this subsection 
     shall take effect on October 1, 2001.
       (g) General Effective Date.--Except as otherwise provided 
     in this section, the amendments made by this section shall 
     take effect on October 1, 1999.
                     TITLE III--ADOPTION PROVISIONS

     SEC. 301. MORE FLEXIBLE PENALTY PROCEDURE TO BE APPLIED FOR 
                   FAILING TO PERMIT INTERJURISDICTIONAL ADOPTION.

       (a) Conversion of Funding Ban Into State Plan 
     Requirement.--Section 471(a) of the Social Security Act (42 
     U.S.C. 671(a)) is amended--
       (1) by striking ``and'' at the end of paragraph (21);
       (2) by striking the period at the end of paragraph (22) and 
     inserting ``; and''; and
       (3) by adding at the end the following:
       ``(23) provides that the State shall not--
       ``(A) deny or delay the placement of a child for adoption 
     when an approved family is available outside of the 
     jurisdiction with responsibility for handling the case of the 
     child; or
       ``(B) fail to grant an opportunity for a fair hearing, as 
     described in paragraph (12), to an individual whose 
     allegation of a violation of subparagraph (A) of this 
     paragraph is denied by the State or not acted upon by the 
     State with reasonable promptness.''.
       (b) Penalty for Noncompliance.--Section 474(d) of such Act 
     (42 U.S.C. 674(d)) is amended in each of paragraphs (1) and 
     (2) by striking ``section 471(a)(18)'' and inserting 
     ``paragraph (18) or (23) of section 471(a)''.
       (c) Conforming Amendment.--Section 474 of such Act (42 
     U.S.C. 674) is amended by striking subsection (e).
       (d) Retroactivity.--The amendments made by this section 
     shall take effect as if included in the enactment of section 
     202 of the Adoption and Safe Families Act of 1997 (Public Law 
     105-89; 111 Stat. 2125).
                        TITLE IV--MISCELLANEOUS

     SEC. 401. ELIMINATION OF BARRIERS TO THE EFFECTIVE 
                   ESTABLISHMENT AND ENFORCEMENT OF MEDICAL CHILD 
                   SUPPORT.

       (a) Study on Effectiveness of Enforcement of Medical 
     Support by State Agencies.--
       (1) Medical child support working group.--Within 60 days 
     after the date of the enactment of this Act, the Secretary of 
     Health and Human Services and the Secretary of Labor shall 
     jointly establish a Medical Child Support Working Group. The 
     purpose of the Working Group shall be to identify the 
     impediments to the effective enforcement of medical support 
     by State agencies administering the programs operated 
     pursuant to part D of title IV of the Social Security Act.
       (2) Membership.--The Working Group shall consist of not 
     more than 30 members and shall be composed of representatives 
     of--
       (A) the Department of Labor;
       (B) the Department of Health and Human Services;
       (C) State directors of programs under part D of title IV of 
     the Social Security Act;
       (D) State directors of the medicaid program under title XIX 
     of the Social Security Act;
       (E) employers, including owners of small businesses and 
     their trade or industry representatives and certified human 
     resource and payroll professionals;
       (F) plan administrators and plan sponsors of group health 
     plans (as defined in section 607(1) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1167(1));
       (G) children potentially eligible for medical support, such 
     as child advocacy organizations;
       (H) State medical child support programs; and
       (I) organizations representing State child support 
     programs.
       (3) Compensation.--The members shall serve without 
     compensation.
       (4) Administrative support.--The Department of Health and 
     Human Services and the Department of Labor shall jointly 
     provide appropriate administrative support to the Working 
     Group, including technical assistance. The Working Group may 
     use the services and facilities of either such Department, 
     with or without

[[Page S7310]]

     reimbursement, as jointly determined by such Departments.
       (5) Report.--
       (A) Report by working group to the secretaries.--Not later 
     than 18 months after the date of the enactment of this Act, 
     the Working Group shall submit to the Secretary of Labor and 
     the Secretary of Health and Human Services a report 
     containing recommendations for appropriate measures to 
     address the impediments to the effective enforcement of 
     medical support by State agencies administering the programs 
     operated pursuant to part D of title IV of the Social 
     Security Act identified by the Working Group, including--
       (i) recommendations based on assessments of the form and 
     content of the National Medical Support Notice, as issued 
     under interim regulations;
       (ii) appropriate measures that establish the priority of 
     withholding of child support obligations, medical support 
     obligations, arrearages in such obligations, and, in the case 
     of a medical support obligation, the employee's portion of 
     any health care coverage premium, by such State agencies in 
     light of the restrictions on garnishment provided under title 
     III of the Consumer Credit Protection Act (15 U.S.C. 1671-
     1677);
       (iii) appropriate procedures for coordinating the 
     provision, enforcement, and transition of health care 
     coverage under the State programs operated pursuant to part D 
     of title IV of the Social Security Act and titles XIX and XXI 
     of such Act;
       (iv) appropriate measures to improve the availability of 
     alternate types of medical support that are aside from health 
     coverage offered through the noncustodial parent's health 
     plan and unrelated to the noncustodial parent's employer, 
     including measures that establish a noncustodial parent's 
     responsibility to share the cost of premiums, copayments, 
     deductibles, or payments for services not covered under a 
     child's existing health coverage;
       (v) recommendations on whether reasonable cost should 
     remain a consideration under section 452(f) of the Social 
     Security Act; and
       (vi) appropriate measures for eliminating any other 
     impediments to the effective enforcement of medical support 
     orders that the Working Group deems necessary.
       (B) Report by secretaries to the congress.--Not later than 
     2 months after receipt of the report pursuant to subparagraph 
     (A), the Secretaries shall jointly submit a report to each 
     House of the Congress regarding the recommendations contained 
     in the report under subparagraph (A).
       (6) Termination.--The Working Group shall terminate 30 days 
     after the date of the issuance of its report under paragraph 
     (5).
       (b) Promulgation of National Medical Support Notice.--
       (1) In general.--The Secretary of Health and Human Services 
     and the Secretary of Labor shall jointly develop and 
     promulgate by regulation a National Medical Support Notice, 
     to be issued by States as a means of enforcing the health 
     care coverage provisions in a child support order.
       (2) Requirements.--The National Medical Support Notice 
     shall--
       (A) conform with the requirements which apply to medical 
     child support orders under section 609(a)(3) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1169(a)(3)) 
     in connection with group health plans (subject to section 
     609(a)(4) of such Act), irrespective of whether the group 
     health plan is covered under section 4 of such Act;
       (B) conform with the requirements of part D of title IV of 
     the Social Security Act; and
       (C) include a separate and easily severable employer 
     withholding notice, informing the employer of--
       (i) applicable provisions of State law requiring the 
     employer to withhold any employee contributions due under any 
     group health plan in connection with coverage required to be 
     provided under such order;
       (ii) the duration of the withholding requirement;
       (iii) the applicability of limitations on any such 
     withholding under title III of the Consumer Credit Protection 
     Act;
       (iv) the applicability of any prioritization required under 
     State law between amounts to be withheld for purposes of cash 
     support and amounts to be withheld for purposes of medical 
     support, in cases where available funds are insufficient for 
     full withholding for both purposes; and
       (v) the name and telephone number of the appropriate unit 
     or division to contact at the State agency regarding the 
     National Medical Support Notice.
       (3) Procedures.--The regulations promulgated pursuant to 
     paragraph (1) shall include appropriate procedures for the 
     transmission of the National Medical Support Notice to 
     employers by State agencies administering the programs 
     operated pursuant to part D of title IV of the Social 
     Security Act.
       (4) Interim regulations.--Not later than 10 months after 
     the date of the enactment of this Act, the Secretaries shall 
     issue interim regulations providing for the National Medical 
     Support Notice.
       (5) Final regulations.--Not later than 1 year after the 
     issuance of the interim regulations under paragraph (4), the 
     Secretary of Health and Human Services and the Secretary of 
     Labor shall jointly issue final regulations providing for the 
     National Medical Support Notice.
       (c) Required Use by States of National Medical Support 
     Notices.--
       (1) State procedures.--Section 466(a)(19) of the Social 
     Security Act (42 U.S.C. 666(a)(19)) is amended to read as 
     follows:
       ``(19) Health care coverage.--Procedures under which--
       ``(A) effective as provided in section 401(c)(3) of the 
     Child Support Performance and Incentive Act of 1998, all 
     child support orders enforced pursuant to this part which 
     include a provision for the health care coverage of the child 
     are enforced, where appropriate, through the use of the 
     National Medical Support Notice promulgated pursuant to 
     section 401(b) of the Child Support Performance and Incentive 
     Act of 1998 (and referred to in section 609(a)(5)(C) of the 
     Employee Retirement Income Security Act of 1974 in connection 
     with group health plans covered under title I of such Act, in 
     section 401(e)(3)(C) of the Child Support Performance and 
     Incentive Act of 1998 in connection with State or local group 
     health plans, and in section 401(f)(5)(C) of such Act in 
     connection with church group health plans);
       ``(B) unless alternative coverage is allowed for in any 
     order of the court (or other entity issuing the child support 
     order), in any case in which a noncustodial parent is 
     required under the child support order to provide such health 
     care coverage and the employer of such noncustodial parent is 
     known to the State agency--
       ``(i) the State agency uses the National Medical Support 
     Notice to transfer notice of the provision for the health 
     care coverage of the child to the employer;
       ``(ii) within 20 business days after the date of the 
     National Medical Support Notice, the employer is required to 
     transfer the Notice, excluding the severable employer 
     withholding notice described in section 401(b)(2)(C) of the 
     Child Support Performance and Incentive Act of 1998, to the 
     appropriate plan providing any such health care coverage for 
     which the child is eligible;
       ``(iii) in any case in which the noncustodial parent is a 
     newly hired employee entered in the State Directory of New 
     Hires pursuant to section 453A(e), the State agency provides, 
     where appropriate, the National Medical Support Notice, 
     together with an income withholding notice issued pursuant to 
     section 466(b), within 2 days after the date of the entry of 
     such employee in such Directory; and
       ``(iv) in any case in which the employment of the 
     noncustodial parent with any employer who has received a 
     National Medical Support Notice is terminated, such employer 
     is required to notify the State agency of such termination; 
     and
       ``(C) any liability of the noncustodial parent to such plan 
     for employee contributions which are required under such plan 
     for enrollment of the child is effectively subject to 
     appropriate enforcement, unless the noncustodial parent 
     contests such enforcement based on a mistake of fact.''.
       (2) Conforming amendments.--Section 452(f) of such Act (42 
     U.S.C. 652(f)) is amended in the first sentence--
       (A) by striking ``petition for the inclusion of'' and 
     inserting ``include''; and
       (B) by inserting ``and enforce medical support'' before 
     ``whenever''.
       (3) Effective date.--The amendments made by this subsection 
     shall be effective with respect to periods beginning on or 
     after the later of--
       (A) October 1, 2001; or
       (B) the effective date of laws enacted by the legislature 
     of such State implementing such amendments,

     but in no event later than the first day of the first 
     calendar quarter beginning after the close of the first 
     regular session of the State legislature that begins after 
     the date of the enactment of this Act. For purposes of the 
     preceding sentence, in the case of a State that has a two-
     year legislative session, each year of such session shall be 
     deemed to be a separate regular session of the State 
     legislature.
       (d) National Medical Support Notice Deemed under ERISA a 
     Qualified Medical Child Support Order.--Section 609(a)(5) of 
     the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1169(a)(5)) is amended by adding at the end the 
     following:
       ``(C) National medical support notice deemed to be a 
     qualified medical child support order.--
       ``(i) In general.--If the plan administrator of a group 
     health plan which is maintained by the employer of a 
     noncustodial parent of a child or to which such an employer 
     contributes receives an appropriately completed National 
     Medical Support Notice promulgated pursuant to section 401(b) 
     of the Child Support Performance and Incentive Act of 1998 in 
     the case of such child, and the Notice meets the requirements 
     of paragraphs (3) and (4), the Notice shall be deemed to be a 
     qualified medical child support order in the case of such 
     child.
       ``(ii) Enrollment of child in plan.--In any case in which 
     an appropriately completed National Medical Support Notice is 
     issued in the case of a child of a participant under a group 
     health plan who is a noncustodial parent of the child, and 
     the Notice is deemed under clause (i) to be a qualified 
     medical child support order, the plan administrator, within 
     40 business days after the date of the Notice, shall--

       ``(I) notify the State agency issuing the Notice with 
     respect to such child whether coverage of the child is 
     available under the terms of the plan and, if so, whether 
     such child is covered under the plan and either the effective 
     date of the coverage or, if necessary, any steps to be taken 
     by the custodial parent (or by the official of a State or 
     political subdivision thereof substituted for the name of 
     such child pursuant to paragraph (3)(A)) to effectuate the 
     coverage; and
       ``(II) provide to the custodial parent (or such substituted 
     official) a description of the coverage available and any 
     forms or documents necessary to effectuate such coverage.

       ``(iii) Rule of construction.--Nothing in this subparagraph 
     shall be construed as requiring a group health plan, upon 
     receipt of a National Medical Support Notice, to provide 
     benefits under the plan (or eligibility for such benefits) in 
     addition to benefits (or eligibility for

[[Page S7311]]

     benefits) provided under the terms of the plan as of 
     immediately before receipt of such Notice.''.
       (e) National Medical Support Notices for State or Local 
     Governmental Group Health Plans.--
       (1) In general.--Each State or local governmental group 
     health plan shall provide benefits in accordance with the 
     applicable requirements of any National Medical Support 
     Notice.
       (2) Enrollment of child in plan.--In any case in which an 
     appropriately completed National Medical Support Notice is 
     issued in the case of a child of a participant under a State 
     or local governmental group health plan who is a noncustodial 
     parent of the child, the plan administrator, within 40 
     business days after the date of the Notice, shall--
       (A) notify the State agency issuing the Notice with respect 
     to such child whether coverage of the child is available 
     under the terms of the plan and, if so, whether such child is 
     covered under the plan and either the effective date of the 
     coverage or any steps necessary to be taken by the custodial 
     parent (or by any official of a State or political 
     subdivision thereof substituted in the Notice for the name of 
     such child in accordance with procedures appliable under 
     subsection (b)(2) of this section) to effectuate the 
     coverage; and
       (B) provide to the custodial parent (or such substituted 
     official) a description of the coverage available and any 
     forms or documents necessary to effectuate such coverage.
       (3) Rule of construction.--Nothing in this subsection shall 
     be construed as requiring a State or local governmental group 
     health plan, upon receipt of a National Medical Support 
     Notice, to provide benefits under the plan (or eligibility 
     for such benefits) in addition to benefits (or eligibility 
     for benefits) provided under the terms of the plan as of 
     immediately before receipt of such Notice.
       (4) Definitions.--For purposes of this subsection--
       (A) State or local governmental group health plan.--The 
     term ``State or local governmental group health plan'' means 
     a group health plan which is established or maintained for 
     its employees by the government of any State, any political 
     subdivision of a State, or any agency or instrumentality of 
     either of the foregoing.
       (B) Alternate recipient.--The term ``alternate recipient'' 
     means any child of a participant who is recognized under a 
     National Medical Support Notice as having a right to 
     enrollment under a State or local governmental group health 
     plan with respect to such participant.
       (C) Group health plan.--The term ``group health plan'' has 
     the meaning provided in section 607(1) of the Employee 
     Retirement Income Security Act of 1974.
       (D) State.--The term ``State'' includes the District of 
     Columbia, the Commonwealth of Puerto Rico, the Virgin 
     Islands, Guam, and American Samoa.
       (E) Other terms.--The terms ``participant'' and 
     ``administrator'' shall have the meanings provided such 
     terms, respectively, by paragraphs (7) and (16) of section 3 
     of the Employee Retirement Income Security Act of 1974.
       (5) Effective date.--The provisions of this subsection 
     shall take effect on the date of the issuance of interim 
     regulations pursuant to subsection (b)(4) of this section.
       (f) Qualified Medical Child Support Orders and National 
     Medical Support Notices for Church Plans.--
       (1) In general.--Each church group health plan shall 
     provide benefits in accordance with the applicable 
     requirements of any qualified medical child support order. A 
     qualified medical child support order with respect to any 
     participant or beneficiary shall be deemed to apply to each 
     such group health plan which has received such order, from 
     which the participant or beneficiary is eligible to receive 
     benefits, and with respect to which the requirements of 
     paragraph (4) are met.
       (2) Definitions.--For purposes of this subsection--
       (A) Church group health plan.--The term ``church group 
     health plan'' means a group health plan which is a church 
     plan.
       (B) Qualified medical child support order.--The term 
     ``qualified medical child support order'' means a medical 
     child support order--
       (i) which creates or recognizes the existence of an 
     alternate recipient's right to, or assigns to an alternate 
     recipient the right to, receive benefits for which a 
     participant or beneficiary is eligible under a church group 
     health plan; and
       (ii) with respect to which the requirements of paragraphs 
     (3) and (4) are met.
       (C) Medical child support order.--The term ``medical child 
     support order'' means any judgment, decree, or order 
     (including approval of a settlement agreement) which--
       (i) provides for child support with respect to a child of a 
     participant under a church group health plan or provides for 
     health benefit coverage to such a child, is made pursuant to 
     a State domestic relations law (including a community 
     property law), and relates to benefits under such plan; or
       (ii) is made pursuant to a law relating to medical child 
     support described in section 1908 of the Social Security Act 
     (as added by section 13822 of the Omnibus Budget 
     Reconciliation Act of 1993) with respect to a church group 
     health plan,

     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. For 
     purposes of this paragraph, an administrative notice which is 
     issued pursuant to an administrative process referred to in 
     subclause (II) of the preceding sentence and which has the 
     effect of an order described in clause (i) or (ii) of the 
     preceding sentence shall be treated as such an order.
       (D) Alternate recipient.--The term ``alternate recipient'' 
     means any child of a participant who is recognized under a 
     medical child support order as having a right to enrollment 
     under a church group health plan with respect to such 
     participant.
       (E) Group health plan.--The term ``group health plan'' has 
     the meaning provided in section 607(1) of the Employee 
     Retirement Income Security Act of 1974.
       (F) State.--The term ``State'' includes the District of 
     Columbia, the Commonwealth of Puerto Rico, the Virgin 
     Islands, Guam, and American Samoa.
       (G) Other terms.--The terms ``participant'', 
     ``beneficiary'', ``administrator'', and ``church plan'' shall 
     have the meanings provided such terms, respectively, by 
     paragraphs (7), (8), (16), and (33) of section 3 of the 
     Employee Retirement Income Security Act of 1974.
       (3) Information to be included in qualified order.--A 
     medical child support order meets the requirements of this 
     paragraph only if such order clearly specifies--
       (A) the name and the last known mailing address (if any) of 
     the participant and the name and mailing address of each 
     alternate recipient covered by the order, except that, to the 
     extent provided in the order, the name and mailing address of 
     an official of a State or a political subdivision thereof may 
     be substituted for the mailing address of any such alternate 
     recipient;
       (B) a reasonable description of the type of coverage to be 
     provided to each such alternate recipient, or the manner in 
     which such type of coverage is to be determined; and
       (C) the period to which such order applies.
       (4) Restriction on new types or forms of benefits.--A 
     medical child support order meets the requirements of this 
     paragraph only if such order does not require a church group 
     health plan to provide any type or form of benefit, or any 
     option, not otherwise provided under the plan, except to the 
     extent necessary to meet the requirements of a law relating 
     to medical child support described in section 1908 of the 
     Social Security Act (as added by section 13822 of the Omnibus 
     Budget Reconciliation Act of 1993).
       (5) Procedural requirements.--
       (A) Timely notifications and determinations.--In the case 
     of any medical child support order received by a church group 
     health plan--
       (i) the plan administrator shall promptly notify the 
     participant and each alternate recipient of the receipt of 
     such order and the plan's procedures for determining whether 
     medical child support orders are qualified medical child 
     support orders; and
       (ii) within a reasonable period after receipt of such 
     order, the plan administrator shall determine whether such 
     order is a qualified medical child support order and notify 
     the participant and each alternate recipient of such 
     determination.
       (B) Establishment of procedures for determining qualified 
     status of orders.--Each church group health plan shall 
     establish reasonable procedures to determine whether medical 
     child support orders are qualified medical child support 
     orders and to administer the provision of benefits under such 
     qualified orders. Such procedures--
       (i) shall be in writing;
       (ii) shall provide for the notification of each person 
     specified in a medical child support order as eligible to 
     receive benefits under the plan (at the address included in 
     the medical child support order) of such procedures promptly 
     upon receipt by the plan of the medical child support order; 
     and
       (iii) shall permit an alternate recipient to designate a 
     representative for receipt of copies of notices that are sent 
     to the alternate recipient with respect to a medical child 
     support order.
       (C) National medical support notice deemed to be a 
     qualified medical child support order.--
       (i) In general.--If the plan administrator of any church 
     group health plan which is maintained by the employer of a 
     noncustodial parent of a child or to which such an employer 
     contributes receives an appropriately completed National 
     Medical Support Notice promulgated pursuant to subsection (b) 
     of this section in the case of such child, and the Notice 
     meets the requirements of paragraphs (3) and (4) of this 
     subsection, the Notice shall be deemed to be a qualified 
     medical child support order in the case of such child.
       (ii) Enrollment of child in plan.--In any case in which an 
     appropriately completed National Medical Support Notice is 
     issued in the case of a child of a participant under a church 
     group health plan who is a noncustodial parent of the child, 
     and the Notice is deemed under clause (i) to be a qualified 
     medical child support order, the plan administrator, within 
     40 business days after the date of the Notice, shall--

       (I) notify the State agency issuing the Notice with respect 
     to such child whether coverage of the child is available 
     under the terms of the plan and, if so, whether such child is 
     covered under the plan and either the effective date of the 
     coverage or any steps necessary to be taken by the custodial 
     parent (or by the official of a State or political 
     subdivision thereof substituted for the name of such child 
     pursuant to paragraph (3)(A)) to effectuate the coverage; and
       (II) provide to the custodial parent (or such substituted 
     official) a description of the coverage available and any 
     forms or documents necessary to effectuate such coverage.

       (iii) Rule of construction.--Nothing in this subparagraph 
     shall be construed as requiring a church group health plan, 
     upon receipt of a National Medical Support Notice, to provide 
     benefits under the plan (or eligibility for such benefits) in 
     addition to benefits (or eligibility for benefits) provided 
     under the terms of the plan as of immediately before receipt 
     of such Notice.

[[Page S7312]]

       (6) Direct provision of benefits provided to alternate 
     recipients.--Any payment for benefits made by a church group 
     health plan pursuant to a medical child support order in 
     reimbursement for expenses paid by an alternate recipient or 
     an alternate recipient's custodial parent or legal guardian 
     shall be made to the alternate recipient or the alternate 
     recipient's custodial parent or legal guardian.
       (7) Payment to state official treated as satisfaction of 
     plan's obligation to make payment to alternate recipient.--
     Payment of benefits by a church group health plan to an 
     official of a State or a political subdivision thereof whose 
     name and address have been substituted for the address of an 
     alternate recipient in a medical child support order, 
     pursuant to paragraph (3)(A), shall be treated, for purposes 
     of this subsection and part D of title IV of the Social 
     Security Act, as payment of benefits to the alternate 
     recipient.
       (8) Effective date.--The provisions of this subsection 
     shall take effect on the date of the issuance of interim 
     regulations pursuant to subsection (b)(4) of this section.
       (g) Report and Recommendations Regarding the Enforcement of 
     Qualified Medical Child Support Orders.--Not later than 8 
     months after the issuance of the report to the Congress 
     pursuant to subsection (a)(5), the Secretary of Health and 
     Human Services and the Secretary of Labor shall jointly 
     submit to each House of the Congress a report containing 
     recommendations for appropriate legislation to improve the 
     effectiveness of, and enforcement of, qualified medical child 
     support orders under the provisions of subsection (f) of this 
     section and section 609(a) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1169(a)).
       (h) Technical Corrections.--
       (1) Amendment relating to public law 104-266.--
       (A) In general.--Subsection (f) of section 101 of the 
     Employee Retirement Income Security Act of 1974 (29 U.S.C. 
     1021(f)) is repealed.
       (B) Effective date.--The amendment made by subparagraph (A) 
     shall take effect as if included in the enactment of the Act 
     entitled ``An Act to repeal the Medicare and Medicaid 
     Coverage Data Bank'', approved October 2, 1996 (Public Law 
     104-226; 110 Stat. 3033).
       (2) Amendments relating to public law 103-66.--
       (A) In general.--(i) Section 4301(c)(4)(A) of the Omnibus 
     Budget Reconciliation Act of 1993 (Public Law 103-66; 107 
     Stat. 377) is amended by striking ``subsection (b)(7)(D)'' 
     and inserting ``subsection (b)(7)''.
       (ii) Section 514(b)(7) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1144(b)(7)) is amended by 
     striking ``enforced by'' and inserting ``they apply to''.
       (iii) Section 609(a)(2)(B)(ii) of such Act (29 U.S.C. 
     1169(a)(2)(B)(ii)) is amended by striking ``enforces'' and 
     inserting ``is made pursuant to''.
       (B) Child defined.--Section 609(a)(2) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1169(a)(2)) 
     is amended by adding at the end the following:
       ``(D) Child.--The term `child' includes any child adopted 
     by, or placed for adoption with, a participant of a group 
     health plan.''.
       (C) Effective date.--The amendments made by subparagraph 
     (A) shall be effective as if included in the enactment of 
     section 4301(c)(4)(A) of the Omnibus Budget Reconciliation 
     Act of 1993.
       (3) Amendment related to public law 105-33.--
       (A) In general.--Section 609(a)(9) of the Employee 
     Retirement Income Security Act of 1974 (29 U.S.C. 1169(a)(9)) 
     is amended by striking ``the name and address'' and inserting 
     ``the address''.
       (B) Effective date.--The amendment made by subparagraph (A) 
     shall be effective as if included in the enactment of section 
     5611(b) of the Balanced Budget Act of 1997.

     SEC. 402. SAFEGUARD OF NEW EMPLOYEE INFORMATION.

       (a) Penalty for Unauthorized Access, Disclosure, or Use of 
     Information.--Section 453(l) of the Social Security Act (42 
     U.S.C. 653(l)) is amended--
       (1) by striking ``Information'' and inserting the 
     following:
       ``(1) In general.--Information''; and
       (2) by adding at the end the following:
       ``(2) Penalty for misuse of information in the national 
     directory of new hires.--The Secretary shall require the 
     imposition of an administrative penalty (up to and including 
     dismissal from employment), and a fine of $1,000, for each 
     act of unauthorized access to, disclosure of, or use of, 
     information in the National Directory of New Hires 
     established under subsection (i) by any officer or employee 
     of the United States who knowingly and willfully violates 
     this paragraph.''.
       (b) Limits on Retention of Data in the National Directory 
     of New Hires.--Section 453(i)(2) of such Act (42 U.S.C. 
     653(i)(2)) is amended to read as follows:
       ``(2) Data entry and deletion requirements.--
       ``(A) In general.--Information provided pursuant to section 
     453A(g)(2) shall be entered into the data base maintained by 
     the National Directory of New Hires within 2 business days 
     after receipt, and shall be deleted from the data base 24 
     months after the date of entry.
       ``(B) 12-month limit on access to wage and unemployment 
     compensation information.--The Secretary shall not have 
     access for child support enforcement purposes to information 
     in the National Directory of New Hires that is provided 
     pursuant to section 453A(g)(2)(B), if 12 months has elapsed 
     since the date the information is so provided and there has 
     not been a match resulting from the use of such information 
     in any information comparison under this subsection.
       ``(C) Retention of data for research purposes.--
     Notwithstanding subparagraphs (A) and (B), the Secretary may 
     retain such samples of data entered in the National Directory 
     of New Hires as the Secretary may find necessary to assist in 
     carrying out subsection (j)(5).''.
       (c) Notice of Purposes for Which Wage and Salary Data are 
     to be Used.--Within 90 days after the date of the enactment 
     of this Act, the Secretary of Health and Human Services shall 
     notify the Committee on Ways and Means of the House of 
     Representatives and the Committee on Finance of the Senate of 
     the specific purposes for which the new hire and the wage and 
     unemployment compensation information in the National 
     Directory of New Hires is to be used. At least 30 days before 
     such information is to be used for a purpose not specified in 
     the notice provided pursuant to the preceding sentence, the 
     Secretary shall notify the Committee on Ways and Means of the 
     House of Representatives and the Committee on Finance of the 
     Senate of such purpose.
       (d) Report by the Secretary.--Within 3 years after the date 
     of the enactment of this Act, the Secretary of Health and 
     Human Services shall submit to the Committee on Ways and 
     Means of the House of Representatives and the Committee on 
     Finance of the Senate a report on the accuracy of the data 
     maintained by the National Directory of New Hires pursuant to 
     section 453(i) of the Social Security Act, and the 
     effectiveness of the procedures designed to provide for the 
     security of such data.
       (e) Effective Date.--The amendments made by this section 
     shall take effect on October 1, 2000.

     SEC. 403. LIMITATIONS ON USE OF TANF FUNDS FOR MATCHING UNDER 
                   CERTAIN FEDERAL TRANSPORTATION PROGRAM.

       (a) In General.--Section 404 of the Social Security Act (42 
     U.S.C. 604) is amended by adding at the end the following:
       ``(k) Limitations on Use of Grant for Matching Under 
     Certain Federal Transportation Program.--
       ``(1) Use limitations.--A State to which a grant is made 
     under section 403 may not use any part of the grant to match 
     funds made available under section 3037 of the Transportation 
     Equity for the 21st Century Act of 1998, unless--
       ``(A) the grant is used for new or expanded transportation 
     services (and not for construction) that benefit individuals 
     described in subparagraph (C), and not to subsidize current 
     operating costs;
       ``(B) the grant is used to supplement and not supplant 
     other State expenditures on transportation;
       ``(C) the preponderance of the benefits derived from such 
     use of the grant accrues to individuals who are--
       ``(i) recipients of assistance under the State program 
     funded under this part;
       ``(ii) former recipients of such assistance;
       ``(iii) noncustodial parents who are described in item (aa) 
     or (bb) of section 403(a)(5)(C)(ii)(II); and
       ``(iv) low income individuals who are at risk of qualifying 
     for such assistance; and
       ``(D) the services provided through such use of the grant 
     promote the ability of such recipients to engage in work 
     activities (as defined in section 407(d)).
       ``(2) Amount limitation.--From a grant made to a State 
     under section 403(a), the amount that a State uses to match 
     funds described in paragraph (1) of this subsection shall not 
     exceed the amount (if any) by which 30 percent of the total 
     amount of the grant exceeds the amount (if any) of the grant 
     that is used by the State to carry out any State program 
     described in subsection (d)(1) of this section.
       ``(3) Rule of interpretation.--The provision by a State of 
     a transportation benefit under a program conducted under 
     section 3037 of the Transportation Equity for the 21st 
     Century Act of 1998, to an individual who is not otherwise a 
     recipient of assistance under the State program funded under 
     this part, using funds from a grant made under section 403(a) 
     of this Act, shall not be considered to be the provision of 
     assistance to the individual under the State program funded 
     under this part.''.
       (b) Report to the Congress.--Not later than 2 years after 
     the date of the enactment of this Act, the Secretary of 
     Transportation, in consultation with the Secretary of Health 
     and Human Services, shall submit to the Committees on Ways 
     and Means and on Transportation and Infrastructure of the 
     House of Representatives and the Committees on Finance and on 
     Environment and Public Works of the Senate a report that--
       (1) describes the manner in which funds made available 
     under section 3037 of the Transportation Equity for the 21st 
     Century Act of 1998 have been used;
       (2) describes whether such uses of such funds has improved 
     transportation services for low income individuals; and
       (3) contains such other relevant information as may be 
     appropriate.

     SEC. 404. CLARIFICATION OF MEANING OF HIGH-VOLUME AUTOMATED 
                   ADMINISTRATIVE ENFORCEMENT OF CHILD SUPPORT IN 
                   INTERSTATE CASES.

       (a) In General.--Section 466(a)(14)(B) of the Social 
     Security Act (42 U.S.C. 666(a)(14)(B)) is amended to read as 
     follows:
       ``(B) High-volume automated administrative enforcement.--In 
     this part, the term `high-volume automated administrative 
     enforcement', in interstate cases, means, on request of 
     another State, the identification by a State, through 
     automated data matches with financial institutions and other 
     entities where assets may be found, of assets owned by 
     persons who owe child support in other States, and the 
     seizure of such assets by the State, through levy or other 
     appropriate processes.''.

[[Page S7313]]

       (b) Retroactivity.--The amendment made by subsection (a) 
     shall take effect as if included in the enactment of section 
     5550 of the Balanced Budget Act of 1997 (Public Law 105-33; 
     111 Stat. 633).

     SEC. 405. GENERAL ACCOUNTING OFFICE REPORTS.

       (a) Report On Feasibility of Instant Check System.--Not 
     later than December 31, 1998, the Comptroller General of the 
     United States shall report to the Committee on Finance of the 
     Senate and the Committee on Ways and Means of the House of 
     Representatives on the feasibility and cost of creating and 
     maintaining a nationwide instant child support order check 
     system under which an employer would be able to determine 
     whether a newly hired employee is required to provide support 
     under a child support order.
       (b) Report On Implementation and Use of Child Support 
     Databases.--Not later than December 31, 1998, the Comptroller 
     General of the United States shall report to the Committee on 
     Finance of the Senate and the Committee on Ways and Means of 
     the House of Representatives on the implementation of the 
     Federal Parent Locater Service (including the Federal Case 
     Registry of Child Support Orders and the National Directory 
     of New Hires) established under section 453 of the Social 
     Security Act (42 U.S.C. 653) and the State Directory of New 
     Hires established under section 453A of such Act (42 U.S.C. 
     653a). The report shall include a detailed discussion of the 
     purposes for which, and the manner in which, the information 
     maintained in such databases has been used, and an 
     examination as to whether such databases are subject to 
     adequate safeguards to protect the privacy of the individuals 
     with respect to whom information is reported and maintained.

     SEC. 406. DATA MATCHING BY MULTISTATE FINANCIAL INSTITUTIONS.

       (a) Use of Federal Parent Locator Service.--Section 
     466(a)(17)(A)(i) of the Social Security Act (42 U.S.C. 
     666(a)(17)(A)(i)) is amended by inserting ``and the Federal 
     Parent Locator Service in the case of financial institutions 
     doing business in 2 or more States,'' before ``a data match 
     system''.
       (b) Facilitation of Agreements.--Section 452 of such Act 
     (42 U.S.C. 652) is amended by adding at the end the 
     following:
       ``(l) The Secretary, through the Federal Parent Locator 
     Service, may aid State agencies providing services under 
     State programs operated pursuant to this part and financial 
     institutions doing business in 2 or more States in reaching 
     agreements regarding the receipt from such institutions, and 
     the transfer to the State agencies, of information that may 
     be provided pursuant to section 466(a)(17)(A)(i), except that 
     any State that, as of the date of the enactment of this 
     subsection, is conducting data matches pursuant to section 
     466(a)(17)(A)(i) shall have until January 1, 2000, to allow 
     the Secretary to obtain such information from such 
     institutions that are operating in the State. For purposes of 
     section 1113(d) of the Right to Financial Privacy Act of 
     1978, a disclosure pursuant to this subsection shall be 
     considered a disclosure pursuant to a Federal statute.''.
       (c) Protection Against Liability.--Section 469A(a) of such 
     Act (42 U.S.C. 669a(a)) is amended by inserting ``, or for 
     disclosing any such record to the Federal Parent Locator 
     Service pursuant to section 466(a)(17)(A)'' before the 
     period.

     SEC. 407. ELIMINATION OF UNNECESSARY DATA REPORTING.

       (a) In General.--Section 469 of the Social Security Act (42 
     U.S.C. 669) is amended--
       (1) by striking all that precedes subsection (c) and 
     inserting the following:

     ``SEC. 469. COLLECTION AND REPORTING OF CHILD SUPPORT 
                   ENFORCEMENT DATA.

       ``(a) In General.--With respect to each type of service 
     described in subsection (b), the Secretary shall collect and 
     maintain up-to-date statistics, by State, and on a fiscal 
     year basis, on--
       ``(1) the number of cases in the caseload of the State 
     agency administering the plan approved under this part in 
     which the service is needed; and
       ``(2) the number of such cases in which the service has 
     actually been provided.
       ``(b) Types of Services.--The statistics required by 
     subsection (a) shall be separately stated with respect to 
     paternity establishment services and child support obligation 
     establishment services.
       ``(c) Types of Service Recipients.--The statistics required 
     by subsection (a) shall be separately stated with respect 
     to--
       ``(1) recipients of assistance under a State program funded 
     under part A or of payments or services under a State plan 
     approved under part E; and
       ``(2) individuals who are not such recipients.''; and
       (2) in subsection (c), by striking ``(c)'' and inserting 
     ``(d) Rule of Interpretation.--''.
       (b) Conforming Amendment.--Section 452(a)(10) of such Act 
     (42 U.S.C. 652(a)(10)) is amended--
       (1) by adding ``and'' at the end of subparagraph (H); and
       (2) by striking subparagraph (I) and redesignating 
     subparagraph (J) as subparagraph (I).
       (c) Effective Date.--The amendments made by this section 
     shall apply to information maintained with respect to fiscal 
     year 1995 or any succeeding fiscal year.

     SEC. 408. CLARIFICATION OF ELIGIBILITY UNDER WELFARE-TO-WORK 
                   PROGRAMS.

       Section 403(a)(5)(C)(ii) of the Social Security Act (42 
     U.S.C. 603(a)(5)(C)(ii)) is amended--
       (1) in the matter preceding subclause (I) by striking ``of 
     minors whose custodial parent is such a recipient'';
       (2) in subclause (I), by inserting ``or the noncustodial 
     parent'' after ``recipient''; and
       (3) in subclause (II), by striking ``The individual--'' and 
     inserting ``The recipient or the minor children of the 
     noncustodial parent--''.

     SEC. 409. STUDY OF FEASIBILITY OF IMPLEMENTING IMMIGRATION 
                   PROVISIONS OF H.R. 3130, AS PASSED BY THE HOUSE 
                   OF REPRESENTATIVES ON MARCH 5, 1998.

       (a) Study.--The Secretary of Health and Human Services, in 
     consultation with the Immigration and Naturalization Service, 
     shall conduct a study to determine the feasibility of the 
     provisions of title V of H.R. 3130, as passed by the House of 
     Representatives on March 5, 1998, were such provisions to 
     become law, especially whether it would be feasible for the 
     Immigration and Naturalization Service to implement 
     effectively the requirements of such provisions.
       (b) Report to the Congress.--Within 6 months after the date 
     of the enactment of this Act, the Secretary of health and 
     Human Services shall submit to the Committees on Ways and 
     Means and on the Judiciary of the House of Representatives 
     and the Committees on Finance and on the Judiciary of the 
     Senate a report on the results of the study required by 
     subsection (a).

     SEC. 410. TECHNICAL CORRECTIONS.

       (a) Section 413(g)(1) of the Social Security Act (42 U.S.C. 
     613(g)(1)) is amended by striking ``Economic and Educational 
     Opportunities'' and inserting ``Education and the 
     Workforce''.
       (b) Section 422(b)(2) of the Social Security Act (42 U.S.C. 
     622(b)(2)) is amended by striking ``under under'' and 
     inserting ``under''.
       (c) Section 432(a)(8) of the Social Security Act (42 U.S.C. 
     632(a)(8)) is amended by adding ``; and'' at the end.
       (d) Section 453(a)(2) of the Social Security Act (42 U.S.C. 
     653(a)(2)) is amended--
       (1) by striking ``parentage,'' and inserting ``parentage 
     or'';
       (2) by striking ``or making or enforcing child custody or 
     visitation orders,''; and
       (3) in subparagraph (A), by decreasing the indentation of 
     clause (iv) by 2 ems.
       (e)(1) Section 5557(b) of the Balanced Budget Act of 1997 
     (42 U.S.C. 608 note) is amended by adding at the end the 
     following: ``The amendment made by section 5536(1)(A) shall 
     not take effect with respect to a State until October 1, 
     2000, or such earlier date as the State may select.''.
       (2) The amendment made by paragraph (1) shall take effect 
     as if included in the enactment of section 5557 of the 
     Balanced Budget Act of 1997 (Public Law 105-33; 111 Stat. 
     637).
       (f) Section 473A(c)(2)(B) of the Social Security Act (42 
     U.S.C. 673b(c)(2)(B)) is amended--
       (1) by striking ``November 30, 1997'' and inserting ``April 
     30, 1998''; and
       (2) by striking ``March 1, 1998'' and inserting ``July 1, 
     1998''.
       (g) Section 474(a) of the Social Security Act (42 U.S.C. 
     674(a)) is amended by striking ``(subject to the limitations 
     imposed by subsection (b))''.
       (h) Section 232 of the Social Security Act Amendments of 
     1994 (42 U.S.C. 1314a) is amended--
       (1) in subsection (b)(3)(D), by striking ``Energy and''; 
     and
       (2) in subsection (d)(4), by striking ``(b)(3)(C)'' and 
     inserting ``(b)(3)''.
         In lieu of the matter proposed to be inserted by the 
     Senate amendment to the title of the bill, insert the 
     following: ``An Act to provide for an alternative penalty 
     procedure for States that fail to meet Federal child support 
     data processing requirements, to reform Federal incentive 
     payments for effective child support performance, to provide 
     for a more flexible penalty procedure for States that violate 
     interjurisdictional adoption requirements, and for other 
     purposes.''.

  Mr. ROTH. Mr. President, I rise in support of ``The Child Support 
Performance and Incentive Act of 1998'' now before the Senate as 
amended and urge its immediate adoption.
  Today we take another important step forward to help millions of 
children receive the financial and medical support owed to them by 
their absent parents. The child support enforcement system involves not 
only the federal, state, and local governments, but employers, 
financial institutions, and private sector agents and vendors as well.
  By continuing to improve the child support enforcement system, we 
will help families avoid and escape welfare dependency.
  Mr. President, when Congress passed welfare reform nearly two years 
ago, we sent a clear and unambiguous message that child support is 
indeed a personal responsibility. It has been with quiet determination 
that Republican and Democratic members have found common ground and 
worked together to strengthen and improve the child support enforcement 
system. The legislation before us today is directed at fulfilling the 
responsibilities of the states.
  The work on this legislation began shortly after the ``Personal 
Responsibility and Work Opportunity Reconciliation Act of 1996'' was 
signed into law.
  The 1996 welfare reform act required the Secretary of Health and 
Human Services to recommend to Congress a new, budget-neutral 
performance-based incentive system for the child support

[[Page S7314]]

enforcement program. H.R. 3130 incorporates those recommendations which 
were developed in consultation with 26 representatives of state and 
local child support enforcement systems. The new incentive program is 
the centerpiece of this bill.
  Under current law, the federal government returns more than $400 
million per year in child support collections to the states as 
incentive payments. But this incentive structure has been criticized 
for years as weak and inadequate.
  All states, regardless of actual performance, receive some incentive 
payments. But for more than a decade, performance has not been tied to 
the national goals of the program.
  H.R. 3130 breaks the past and creates five categories in which state 
performance will be evaluated and rewarded. The states will be measured 
according to their performance in paternity establishment, 
establishment of court orders, collections of current child support 
payments, collections on past due payments, and cost effectiveness.
  The new incentive structure is an important development not only for 
the child support enforcement system but also as a model for improving 
accountability and performance in government.
  The second major feature of this bill is to provide for an 
alternative penalty procedure for those states that have failed to meet 
federal child support data processing requirements. Less than half of 
the states have been certified as in compliance. Without this change, 
states face not only the loss of their entire child support grant, but 
all of their funds in the Temporary Assistance for Needy Families 
program as well.
  Such a result would obviously be crippling to a state and would 
ultimately hurt the very families these programs are intended to help. 
H.R. 3130 provides for a new mechanism under which HHS and the states 
will map out a strategic plan to meet the federal requirements. States 
which do not achieve compliance will face tough but fair penalties.

  The alternative penalty procedure is a new tool for both the state 
and federal governments to achieve compliance with federal requirements 
in the child support enforcement system. It is not intended to be a 
means of raising revenue at the expense of the state and potentially at 
the expense of the very families who rely on this system.
  H.R. 3130 also provides additional flexibility to the states in how 
they design their automated systems. In looking back over the history 
of automation, we find there were a number of mistakes made at both the 
federal and state levels which contributed to the delay in getting 
these systems operational. The child support enforcement system is a 
prime example of what can happen when regulations fail to keep pace 
with real world practices.
  H.R. 3130 recognizes the advances in technologies and allows states 
to take advantage of these improvements. It properly refocuses federal 
policy on function and results rather than on rigid rules.
  All of these changes will work together to get the states in 
compliance as quickly as possible. This will mean the child support 
enforcement system will work better for the families who depend on 
child support.
  Working with the states and employers, a bipartisan effort has 
yielded a three part approach to eliminate barriers to effective 
medical support enforcement. More children will no doubt gain access to 
their non-custodial parents' private health insurance plans because of 
H.R. 3130. Children and taxpayers alike will benefit from the medical 
child support provisions.
  H.R. 3130 also makes a correction in how penalties are applied under 
the new ``Adoption and Safe Families Act of 1997'' which became law 
last November. It is vitally important that the states be held 
accountable for assisting the children in foster care.
  When Congress passed this legislation last fall, it sent an important 
message across the country that a child should not be denied the 
opportunity to be adopted into a loving and caring family simply 
because the prospective parents live in the next county. The intent of 
Section 202, ``Adoptions Across State and County Jurisdictions'' is to 
ensure that states facilitate timely permanent placements for children 
so their wait in foster care be brief.
  A child should not be denied the opportunity to be adopted into a 
loving and caring family simply because the prospective parents live in 
the next county.
  The intent of P.L. 105-89 clearly is to remove interjurisdictional 
barriers to adoption. I am deeply concerned about recent reports that 
some states may in fact be erecting new barriers to families who are 
seeking to adopt. There are some disturbing reports that some states 
may be engaging in policies or practices that could create 
interjurisdictional barriers to adoption such as discontinuance of the 
registration of waiting families with adoption exchanges outside the 
state, refusal to share home studies across state lines, and refusal to 
respond to out-of-state inquiries.
  The Secretary should closely monitor any change in state policy or 
practice which discourages families from seeking to adopt children and 
take appropriate action if a state is not complying with the law. When 
the Department of Health and Human Services issues regulations on how 
the new penalties are enforced, it should of course provide the states 
with the opportunity to present evidence of how it complies with the 
new law. The review of this new requirement must be a fair and complete 
assessment of whether the law is being met.

  Mr. President, this is indeed an important, bipartisan bill which 
will prove itself to pay dividends for Americans' families. I urge its 
adoption.
  I ask unanimous consent that a legislative history be printed in the 
Record to reflect the Senate and House action on H.R. 3130. While there 
is a cost of $2,009 associated with printing this material, in the 
Record, it is important that our action be clearly explained. 
Furthermore, this history is in lieu of a conference report which would 
have been printed in the Record, so there is really no additional cost 
to the taxpayer.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

LEGISLATIVE HISTORY OF SENATE AND HOUSE AMENDMENTS TO THE CHILD SUPPORT 
                 PERFORMANCE AND INCENTIVE ACT OF 1998

          Title I. Child Support Data Processing Requirements


                Sec. 101. Alternative Penalty Procedures

     1. Eligibility for alternative penalty procedure
       Present law
       No provision. Under current law, if a State failed to 
     implement a statewide automated data processing and 
     information retrieval system by October 1, 1997 (which is a 
     child support enforcement State plan requirement), the Office 
     of Child Support Enforcement is required to ``disapprove'' 
     the State's child support enforcement plan, after an appeals 
     process, and suspend federal funding for the State's child 
     support enforcement program. Moreover, pursuant to title IV-A 
     (Temporary Assistance for Needy Families; TANF), a State that 
     cannot certify that it has an approved Child Support 
     Enforcement plan when it amends its TANF plan (generally 
     every 2 years), is not eligible for TANF block grant funding. 
     Thus, a State that failed to implement a statewide automated 
     data processing and information retrieval system is in 
     eventual jeopardy of losing its TANF block grant allocation 
     along with its federal Chief Support Enforcement funding.
       House bill
       If the Secretary determines that a State is making good 
     faith efforts to comply with the data processing requirements 
     and if the State submits a corrective compliance plan 
     describing how it will comply, by when, and at what cost, the 
     State may avoid the penalty in current law and qualify for 
     the new penalty procedure outlined below.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     2. Penalty amount
       Present law
       As noted above, the penalty for noncompliance with a Child 
     Support Enforcement State plan requirement is loss of all 
     federal Child Support Enforcement funding and all TANF 
     funding as well.
       House bill
       The percentage penalty is 4 percent, 8 percent, 16 percent, 
     and 20 percent respectively for the first, second, third, and 
     fourth or subsequent years of failing to comply with the data 
     processing requirements. The percentage penalty is applied to 
     the amount payable to the State in the previous year as 
     Federal administrative reimbursement under the child support 
     program.
       Senate amendment
       Same as House bill, except in the fourth or subsequent 
     year, the percentage penalty is 30 percent.

[[Page S7315]]

       Agreement
       The agreement follows the House bill and the Senate 
     amendment with the modification that the percentage penalty 
     is 4, 8, 16, 25, and 30 percent in the first through fifth 
     and subsequent years respectively.
     3. Penalty waiver
       Present law
       No provision.
       House bill
       If by December 31, 1997, a State has submitted to the 
     Secretary a request that the Secretary certify the State as 
     meeting the 1998 data processing requirements and is 
     subsequently certified as a result of a review pursuant to 
     the request, all penalties are waived.
       Senate amendment
       If at any time during year 1998, a State has submitted to 
     the Secretary a request that the Secretary certify the State 
     as having met the 1988 data processing requirement and is 
     subsequently certified as a result of a review pursuant to 
     the request, all penalties are waived.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment except the State request that the Secretary certify 
     the state as meeting the 1988 data processing requirements 
     must be submitted by August 1, 1998.
     4. Partial Penalty Forgiveness
       Present law
       No provision.
       House bill
       If a State operating under the penalty procedure achieves 
     compliance with the data processing requirements before the 
     first day of the next fiscal year, then the penalty for the 
     current fiscal year is reduced by 75 percent.
       Senate amendment
       Under the Senate amendment, States will not face a penalty 
     in the fiscal year in which they come into compliance. 
     Moreover, if a State comes into compliance within the first 
     two years after penalties have been imposed, then the penalty 
     from the prior fiscal year is reduced by 20 percent.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment with the modifications that there is no 
     retrospective penalty reduction of 20 percent and the penalty 
     reduction in the year of certification is 90 percent. It is 
     expected that the date of certification for a given State 
     will be the date the State informs the Secretary in writing 
     that the State is ready for certification review and the 
     State in fact is certified under that review.
     5. Penalty Reduction for Good Performance
       Present law
       No provision.
       House bill
       States must comply with all the data processing 
     requirements imposed by the 1996 welfare reform law by 
     October 1, 2000. A State that fails to comply may 
     nonetheless have its annual penalty reduced by 20 percent 
     for each performance measure under the new incentive 
     system (see Title II below) for which it achieves a 
     maximum score. Thus, for example, a State being penalized 
     would have its penalty for a given year reduced by 60 
     percent if it achieved maximum performance on three of the 
     five performance measures.
       Senate enactment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     6. Penalty procedure applies to requirements of 1988 act and 
         1996 act
       Present law
       P.L. 104-193 requires that as part of their State child 
     support enforcement plans all States, by October 1, 2000, 
     have in effect a single statewide automated data processing 
     and information retrieval system that meets all of the 
     specified requirements, except that the deadline is extended 
     by one day for each day (if any) by which the Secretary fails 
     to meet the deadline for final regulations on the new data 
     processing requirements (i.e., which is not later than August 
     22, 1998). The disapproval procedures described above also 
     would apply to these new data processing requirements.
       House bill
       With the exception of the FY1998 waiver provision, which 
     applies only to the 1988 requirements, and the penalty 
     reduction provision for good performance, which applies only 
     to the 1996 requirements, the new penalty procedure applies 
     to data processing requirements of both the 1988 Family 
     Support Act and the 1996 welfare reform legislation.
       Senate enactment
       Same as House bill, except the Secretary may only impose a 
     single penalty for any given fiscal year with respect to the 
     establishment or operation of an automated data processing 
     and information retrieval system.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment with a modification which stipulates that a state 
     may not be penalized for violating the automatic data 
     processing and information retrieval system requirements 
     imposed under Public Law 104-193 if the state is being 
     penalized for violating the automatic data processing 
     requirements of the 1988 Family Support Act. In addition, a 
     State is not subject to more than one penalty at a given time 
     under the data processing requirements of either the 1988 Act 
     or the 1996 Act.
     7. Exemption from TANF penalty procedures
       Present law
       As noted above, States without approved child support 
     enforcement plans are in eventual danger of losing funding 
     for the TANF block grant (which would include supplemental 
     and bonus TANF funding and funding for the Welfare-to-Work 
     program).
       The TANF penalty for a State which the Secretary finds has 
     not complied with one or more of the child support 
     enforcement program requirements and has failed to take 
     sufficient corrective action to achieve the appropriate 
     performance level or compliance is subject to a graduated 
     penalty of TANF block grant funds equal to not less than 1% 
     nor more than 2% for the first finding of noncompliance; not 
     less than 2% nor more than 3% for the second consecutive 
     finding of noncompliance; and not less than 3% nor more than 
     5% for the third or subsequent finding of noncompliance.
       House bill
       No provision.
       Senate amendment
       Because States are subject to the penalty procedure 
     outlined above for violations of the data processing 
     requirement, they are exempt from the TANF penalty procedure 
     for such violations.
       Agreement
       The agreement follows the Senate amendment. In addition the 
     Social Security Act is amended to clarify that TANF money 
     used as matching funds for grants under section 3037 of the 
     Transportation Equity for the 21st Century Act of 1998 can 
     only be spent on the transportation needs of families 
     eligible for TANF benefits and other low-income families. 
     TANF funds used to provide transportation services under 
     section 3037 grants are not considered assistance for 
     purposes of the TANF program.


Sec. 102. Authority to Waive Single Statewide Automated Data Processing 
              and Information Retrieval System Requirement

     8. Expansion of waiver provision
       Present law
       Current law states that the Secretary of the Department of 
     Health and Human Services may waive any requirement related 
     to the advance planning automated data processing document or 
     the automated data processing and information retrieval 
     system if the State demonstrates to the Secretary's 
     satisfaction that the State has an alternative system or 
     systems that enable the State to be in substantial compliance 
     with other requirements of the child support enforcement 
     program. The waiver must also meet the following conditions: 
     (1) must be designed to improve the financial well-being of 
     children or otherwise improve the operation of the child 
     support enforcement program, (2) may not permit modifications 
     in the child support enforcement program which would have the 
     effect of disadvantaging children in need of support, and (3) 
     must not result in increased cost to the federal government 
     under the TANF program; or the State provides assurances to 
     the Secretary that steps will be taken to otherwise improve 
     the State's child support enforcement program.
       House bill
       The authority of the Secretary to waive certain data 
     processing requirements and to provide Federal funding for a 
     wider range of State data system activities is expanded to 
     include waiving the single statewide system requirement under 
     certain conditions and providing Federal funds to develop and 
     enhance local systems linked to State systems. To qualify, a 
     State must demonstrate that it can develop an alternative 
     system that: Can help the State meet the paternity 
     establishment requirement and other performance measures; can 
     submit required data to HHS that is complete and 
     reliable; substantially complies with all requirements of 
     the child support enforcement program; achieves all the 
     functional capacity for automatic data processing outlined 
     in the statute; meets the requirements for distributing 
     collections to families and governments, including cases 
     in which support is owed to more than one family or more 
     than one government; has one and only one point of contact 
     for interstate case processing and intrastate case 
     management; is based on standardized data elements, forms, 
     and definitions that are used throughout the State; can be 
     operational in no more time than it would take to achieve 
     an operational single statewide system; and can process 
     child support cases as quickly, efficiently, and 
     effectively as would be possible with a single statewide 
     system.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     9. Federal payments under waiver provision
       Present law
       To be approved for a waiver, a State must demonstrate that 
     the proposed project: (1) is designed to improve the 
     financial well-being of children or otherwise improve the 
     operation of the child support program; (2) does not permit 
     modifications in the child support program that would have 
     the effect of

[[Page S7316]]

     disadvantaging children in need of support; and (3) does not 
     result in increased cost to the Federal government under the 
     TANF program.
       House bill
       In addition to the various waiver requirements described in 
     provision #8 above, and to the requirements in current law, 
     the State must submit to the Secretary separate estimates of 
     the costs to develop and implement both a single statewide 
     system and the alternative system being proposed by the State 
     plus the costs of operating and maintaining these systems for 
     5 years from the date of implementation. The Secretary must 
     agree with the estimates. If a State elects to operate such 
     an alternative system, the State would be paid the 66 percent 
     federal administrative reimbursement only on expenditures 
     equal to the estimated cost of the single statewide system.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.

                Title II. Child Support Incentive System


                 Sec. 201. Incentive Payments to states

     1. Amount of incentive payments
       Present law
       Each State receives an incentive payment equal to at least 
     6 percent of the State's total amount of child support 
     collected on behalf of TANF families for the year, plus at 
     least 6 percent of the State's total amount of child support 
     collected on behalf of non-TANF families for the year. [Note: 
     P.L. 98-378, the Child Support Enforcement Amendments of 
     1984, stipulates that political subdivisions of a State that 
     participate in the costs of support enforcement must receive 
     an appropriate share of any incentive payment given to the 
     State. P.L. 98-378 also requires States to develop criteria 
     for passing through incentives to localities, taking into 
     account the efficiency and effectiveness of local programs.]
       House bill
       The incentive payment for a State for a given year is 
     calculated by multiplying the incentive payment pool for the 
     year by the State's incentive payment share for the year.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     2. Incentive payment pool
       Present law
       No provision.
       House bill
       The incentive payment pool is equal to the CBO estimate of 
     incentive payments for each year under current law. 
     Specifically, the amounts (in millions) for fiscal years 2000 
     through 2008 respectively are: $422, $429, $450, $461, $454, 
     $446, $458, $471 and $483. Specifying these amounts in the 
     statute assures that the incentive payments will be budget 
     neutral. After 2008, the incentive payment pool increases 
     each year by an amount equal to the rate of inflation.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     3. Calculating incentive payments
       Present law
       The maximum incentive payment for a State could reach a 
     high of 10 percent of child support collected on behalf of 
     TANF families plus 10 percent of child support collected on 
     behalf of non-TANF families. There is a limit, however, on 
     the incentive payment for non-TANF child support collections. 
     The incentive payments for such collections may not exceed 
     115 percent of incentive payments for TANF child support 
     collections.
       House bill
       In addition to the incentive payment pool, incentive 
     calculations are based on the five factors defined below. The 
     general approach is to pay to each State its share of the 
     incentive payment pool based on the quality of its 
     performance on the five incentive performance measures. The 
     five computational factors are:
       (1) State collections base is used to ensure that incentive 
     payments are proportional to the amount of child support 
     collected by the State; collections for welfare cases are 
     given double the weight of collections for nonwelfare 
     cases in the calculations;
       (2) Maximum incentive base amount is simply a device to 
     give extra weight to three of the five incentive performance 
     measures because these measures are thought to be more 
     important to State performance. Specifically, paternity 
     establishment, establishment of support orders, and 
     collections on current support receive full weight in the 
     calculations, while collections on past-due support and the 
     cost-effectiveness performance level receive a weight of only 
     75 percent of the other three measures;
       (3) Applicable percentage is the actual measure of 
     performance effectiveness and is determined by looking up the 
     raw performance level in a table; there is a different table 
     for each of the five performance measures (see below);
       (4) Incentive base amount is the total of the applicable 
     percentages for each of the five performance measures 
     multiplied by their respective maximum incentive base amounts 
     (either 1.00 or 0.75);
       (5) State incentive payment share is a percentage 
     calculated by using the four factors defined above. This 
     measure specifies the percentage share of the annual payment 
     pool that each State receives. The State incentive payment 
     share takes into account the State's performance on all five 
     incentive performance measures, the weighting of the five 
     incentive performance measures, its collections in the TANF 
     and non-TANF caseloads, and its performance relative to other 
     States.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     4. Data used to calculate ratios required to be complete and 
         reliable
       Present law
       No provision.
       House bill
       The payment on each of the five performance measures is 
     zero unless the Secretary determines that the data submitted 
     by the State for each measure is complete and reliable.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     5. State collections base
       Present law
       Although the collections base terminology is not used, the 
     incentive payment is based on total child support collected 
     on behalf of TANF families (i.e., TANF collections) plus 
     total child support collected on behalf of non-TANF families 
     (i.e., non-TANF collections).
       House bill
       The collections base for a fiscal year is the sum of two 
     categories of child support collections by the State. The 
     first category is collections on cases in the State child 
     support welfare caseload. This category includes families 
     that are currently or were formerly receiving benefits from 
     TANF (or its predecessor program Aid to Families with 
     Dependent Children), from Medicaid under Title XIX, or from 
     foster care under Title IV-E. Total collections from this 
     category are doubled in the State collections base 
     calculation. The second category is collections from all 
     other families receiving services from the State child 
     support enforcement program.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     6. Determination of applicable percentages for paternity 
         establishment performance level
       Present law
       No provision.
       House bill
       The paternity establishment performance level for a State 
     for a fiscal year is, at the option of the State, either the 
     paternity establishment percentage of cases in the child 
     support program or the paternity establishment percentage of 
     all births in the State. In both cases, the paternity 
     establishment percentage is obtained by dividing the cases in 
     which paternity is established by the total number of 
     nonmarital births. The applicable percentage is then 
     determined in accord with the table in new section 
     458A(b)(6)(A) of the Social Security Act (see Table 1 below).
       Special rule for computing the applicable percentage for 
     paternity establishment: If the paternity establishment 
     performance level of a State is less than 50 percent but 
     exceeds by at least 10 percentage points the paternity 
     establishment performance level of the State for the 
     immediately preceding fiscal year, then the applicable 
     percentage for the State paternity establishment performance 
     level is 50 percent.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     7. Determination of applicable percentages for child support 
         order performance level
       Present law
       No provision.
       House bill
       The support order performance level for a State for a 
     fiscal year is the percentage of cases in the child support 
     program for which there is a support order. The applicable 
     percentage is then determined in accord with the table in new 
     section 458A(b)(6)(B) of the Social Security Act (see Table 2 
     below).
       Special rule for computing the applicable percentage for 
     child support orders: If the support order performance level 
     of a State is less than 50 percent but exceeds by at least 5 
     percentage points the support order performance level of the 
     State for the immediately preceding fiscal year, then the 
     applicable percentage for the State's support order 
     performance level is 50 percent.
       Senate amendment
       Same
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.

[[Page S7317]]

     8. Determination of applicable percentages for collections on 
         current child support due performance level
       Present law
       No provision.
       House bill
       The current support payment performance level for a State 
     for a fiscal year is the total amount of current support 
     collected during the fiscal year from all cases in the child 
     support program (both welfare and non-welfare cases) divided 
     by the total amount owed on support which is not overdue. The 
     applicable percentage is then determined in accord with the 
     table in new section 458A(b)(6)(C) of the Social Security Act 
     (see Table 3 below).
       Special rule for computing the applicable percentage for 
     current payments: If the current payment performance level is 
     less than 40 percent but exceeds by at least 5 percentage 
     points the current payment performance level of the State for 
     the immediately preceding fiscal year, then the applicable 
     percentage for the State's current payment performance level 
     is 50 percent.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     9. Determination of applicable percentages for collections on 
         child support arrearages performance level
       Present law
       No provision.
       House bill
       The arrearages payment performance level for a State for a 
     fiscal year is the total number of cases in the State child 
     support program that received payments on past-due child 
     support divided by the total number of cases in the State 
     child support program in which a payment of child support is 
     past-due. The applicable percentage is then determined in 
     accord with the table in new section 458A(b)(6)(D) of the 
     Social Security Act (see Table 4 below).
       Special rule for computing the applicable percentage for 
     arrears: If the arrearages payment performance level of a 
     State for a fiscal year is less than 40 percent but exceeds 
     by at least 5 percentage points the arreages payment 
     performance level for the immediately preceding fiscal year, 
     then the applicable percentage for the State's arrearages 
     performance level is 50 percent.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     10. Determination of applicable percentages for cost-
         effectiveness performance level
       Present law
       Incentive payments are made according to the collection-to-
     cost ratios (ratio of TANF collections to total child support 
     enforcement administrative costs and ratio of non-TANF 
     collections to total child support enforcement administrative 
     costs) shown below.

        Collection-                                   Incentive payment
        to-cost ratio:                               received (percent)
Less than 1.4 to 1..................................................6.0
At least 1.4 to 1...................................................6.5
At least 1.6 to 1...................................................7.0
At least 1.8 to 1...................................................7.5
At least 2.0 to 1...................................................8.0
At least 2.2 to 1...................................................8.5
At least 2.4 to 1...................................................9.0
At least 2.6 to 1...................................................9.5
At least 2.8 to 1..................................................10.0

       For purposes of calculating these ratios, interstate 
     collections are credited to both the initiating and 
     responding States. In addition, at State option, laboratory 
     costs (for blood testing, etc.) to establish paternity may be 
     excluded from the State's administrative costs in calculating 
     the State's collection-to-cost ratios for purposes of 
     determining the incentive payment.
       House bill
       The cost-effectiveness performance level for a State for a 
     fiscal year is the total amount collected during the fiscal 
     year from all cases in the State child support program 
     divided by the total amount expended during the fiscal year 
     on the State child support program. The applicable percentage 
     is then determined in accord with the table in new section 
     458A(b)(6)(E) of the Social Security Act (see Table 5 below).
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     11. Treatment of interstate collections.
       Present law
       As noted above, in computing incentive payments, child 
     support collected by one State at the request of another 
     State (i.e., interstate collections) are credited to both the 
     initiating State and the responding State. State expenditures 
     on special interstate projects carried out under section 
     455(e) of the Social Security Act must be excluded from the 
     incentive payment calculation.
       House bill
       In computing incentive payments, support collected by a 
     State at the request of another State is treated as having 
     been collected by both States. State expenditures on a 
     special interstate project carried out under section 455(e) 
     are excluded from incentive payment calculations.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     12. Administrative provisions
       Present law
       The Secretary's incentive payments to States for any fiscal 
     year are estimated at or before the beginning of such year 
     based on the best information available. The Secretary makes 
     such payments on a quarterly basis. Each quarterly payment 
     must be reduced or increased to the extent of overpayments or 
     underpayments for prior periods.
       House bill
       The Secretary's incentive payments to States are based on 
     estimates computed from previous performance by the States. 
     Each year, the Secretary must make quarterly payments based 
     on these estimates. Each quarterly payment must be reduced or 
     increased to the extent of overpayments or underpayments for 
     prior periods.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     13. Regulations
       Present law
       Not applicable.
       House bill
       The Secretary of Health and Human Services must prescribe 
     regulations necessary to implement the incentive payment 
     program within 9 months of the date of enactment. These 
     regulations may include directions for excluding certain 
     closed cases and cases over which the State has no 
     jurisdiction.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     14. Reinvestment
       Present law
       No provision.
       House bill
       States must spend their child support incentive payments to 
     carry out their child support enforcement program or to 
     conduct activities approved by the Secretary which may 
     contribute to improving the effectiveness or efficiency of 
     the State child support enforcement program.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     15. Transition rule
       Present law
       Not applicable.
       House bill
       The new incentive system is phased in over 2 years 
     beginning in fiscal year 2000. In fiscal year 2000, 1/3rd of 
     each State's incentive payment is based on the new incentive 
     system and 2/3rds on the old system. In fiscal year 2001, 2/
     3rds of each State's incentive payment is based on the new 
     incentive system and
     1/3rd on the old system. The new system is fully operational 
     in fiscal year 2002.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     16. Review
       Present law
       No provision.
       House bill
       The Secretary of Health and Human Services must conduct a 
     study of the implementation of the incentive payment program 
     in order to identify problems and successes of the program. 
     An interim report must be presented to Congress not later 
     than March 1, 2001. By October 1, 2003, the Secretary must 
     submit a final report. Recommendations for changes that the 
     Secretary determines would improve program operation should 
     be included in the final report.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     17. Study
       Present law
       No provision.
       House bill
       The Secretary, in consultation with State IV-D directors 
     and representatives of children potentially eligible for 
     medical support, must develop a new medical support incentive 
     measure based on effective performance. A report on this new 
     incentive measure must be submitted to Congress not later 
     than October 1, 1999.
       Senate amendment
       Same.

[[Page S7318]]

       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     18. Technical and conforming amendments
       Present law
       No provision.
       House bill
       This section contains two technical and conforming 
     amendments.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     19. Elimination of current incentive program
       Present law
       No provision. (The current incentive payment system is a 
     permanent provision of law.)
       House bill
       The current incentive program under section 458 of the 
     Social Security Act is repealed on October 1, 2001. On that 
     date, section 458A is redesignated as section 458.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.
     20. General effective date
       Present law
       The current incentive payment system took effect on October 
     1, 1985.
       House bill
       Except for the elimination of the current incentive program 
     (see provision #19 above), the amendments made by this 
     legislation take effect on October 1, 1999.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment.

                     Title III. Adoption Provisions


sec. 301. more flexible penalty procedure to be applied for failing to 
                  permit interjurisdictional adoption

       Present law
       Under section 474(e) of the Social Security Act (as 
     established by P.L. 105-89), a State is not eligible for any 
     foster care or adoption assistance payments under Title IV-E 
     if the Secretary finds that the State has denied or delayed a 
     child's adoptive placement when an approved family is 
     available outside the jurisdiction with responsibility for 
     handling the child's case, or the State has failed to grant 
     an opportunity for a fair hearing to anyone who alleges that 
     a violation of this provision was denied by the State or not 
     acted upon promptly.
       House bill
       The current penalty of losing all Federal Title IV-E funds 
     for violating the jurisdictional provision is dropped and a 
     new penalty is substituted. Under the new penalty, States 
     that violate the adoption provision would receive a penalty 
     equal to 2 percent of the Federal funds for foster care and 
     adoption under Title IV-E of the Social Security Act for the 
     first violation, 3 percent for the second violation, and 5 
     percent for the third and subsequent violations.
       Senate amendment
       Same.
       Agreement
       The agreement follows the House bill and the Senate 
     amendment. The intent of a major provision of the Adoption 
     and Safe Families Act of 1997 is to remove 
     interjurisdictional barriers to adoption to ensure that 
     States facilitate timely permanent placements for children. 
     Any State policy or practice that denies a child the 
     opportunity to be adopted across State or county 
     jurisdictions is in clear violation of the Act. The 
     Department of Health and Human Services must develop a 
     comprehensive monitoring strategy to uncover state 
     violations. The new penalties for violating the 
     interjurisdictional provision are aimed at enforcing State 
     plan violations by reducing for a fiscal quarter the amount 
     of money payable to the State by 2 percent for the first 
     violation, 3 percent for the second violation, and 5 percent 
     for the third and subsequent violations. Congress expects the 
     Secretary to carefully monitor changes in State policy on 
     interjurisdictional barriers and to use the new penalties 
     enacted by Congress if necessary.
       The Adoption and Safe Families Act of 1997 does not prevent 
     a State from making efforts to preserve or reunify a family 
     in cases of aggravated circumstances, as long as the child's 
     health and safety are the paramount considerations. In 
     addition, the Adoption and Safe Families Act of 1997 
     establishes a new requirement that States must initiate 
     termination of parental rights proceedings in specific cases 
     that are outlined in the law. However, the law only requires 
     States to initiate such proceedings and does not mandate the 
     outcome. Moreover, the law provides that States are not 
     required to initiate termination of parental rights in 
     certain cases, including when there is a compelling reason to 
     conclude that such proceedings would not be in the child's 
     best interest. Thus, the State retains the discretion to make 
     case-by-case determinations regarding whether to seek 
     termination of parental rights.

                    Title IV. Technical Corrections


 sec. 401. elimination of barriers to the effective Establishment and 
                  Enforcement of Medical Child Support

       Present law
       P.L. 104-193 required Employee Retirement Income Security 
     Act (ERISA) plan administrators to honor health insurance 
     orders (i.e. medical support orders) issued by courts or 
     administrative agencies. It appears that many ERISA plan 
     administrators interpreted the statutory language as 
     requiring the actual receipt of a copy of the order itself. 
     Since it is the practice of many CSE agencies to simply 
     notify the ERISA plan administrator that an order has been 
     issued for a case, many plan administrators did not 
     recognize the administrative notice as sufficient to meet 
     the requirements of current law. Currently only 60% of all 
     national child support orders include a medical support 
     component. In its 1996 review of state child support 
     enforcement programs, GAO reported that at least 13 states 
     were not consistently petitioning to include medical 
     support in its general support orders, and 20 states were 
     not enforcing existing medical support orders.
       House bill
       No provision.
       Senate amendment
       The Senate amendment requires the Secretaries of the 
     Departments of Health and Human Services and Labor to design 
     and implement a National Standardized Medical Support Notice. 
     Proposed regulations would be required no later than 180 days 
     after the date of enactment, and final regulations no later 
     than 1 year after the Date of enactment. State child support 
     enforcement agencies would be required to use this 
     standardized form to communicate the issuance of a medical 
     support order, and employers would be required to accept the 
     form as a ``qualified medical support order'' under the 
     Employee Retirement Income Security Act (ERISA). The 
     Secretaries would jointly establish a medical support working 
     group, not later than 90 days after the date of enactment, to 
     identify and make recommendations for the removal of other 
     barriers to effective medical support. The working group's 
     report on recommendations for appropriate measures to address 
     the impediments to effective enforcement of medical support 
     is due to the Secretary of Health and Human Services, and the 
     Congress, no later than 18 months after the date of 
     enactment. The Secretary of Labor, in consultation with the 
     Secretary of Health and Human Services, would be required to 
     submit to Congress, not later than one year after the date of 
     enactment of this bill, a report containing recommendations 
     for any additional ERISA changes necessary to improve medical 
     support enforcement.
       Agreement
       Medical child support is an essential part of any general 
     child support order because it ensures a child will have 
     access to quality private health care coverage to which she 
     or he would not have access even if available to the 
     noncustodial parent through the employer at reasonable costs. 
     It also prevents the misuse of Federal programs such as 
     Medicaid and the State Children's Health Insurance Program as 
     a backdoor alternative for parents who shirk their medical 
     child support responsibilities. Although ERISA already 
     requires that employers enforce medical child support orders 
     if those orders meet certain criteria laid out in that 
     statute (which qualifies them as Qualified Medical Child 
     Support Orders or QMSCOs), effective enforcement of 
     medical child support is still thwarted by (1) a lack of 
     standardized communication between the state child support 
     enforcement agencies, parents' employers, and the plan 
     administrators of parents' health insurance plans and (2) 
     uniform process for enforcement. Streamlining the medical 
     support process for ERISA plans and non-ERISA plans alike 
     is essential to ensure that all children receive the 
     medical support for which they are eligible and to which 
     they are entitled.
       The agreement follows the Senate provision on medical 
     support with changes. The agreement requires that the Medical 
     Child Support Working Group be established within 60 days 
     after the date of enactment. It is expected that 
     representatives of states, employers, advocacy groups, IV-D 
     agencies and associations, experts in ERISA, and others who 
     must administer this process be invited to participate in the 
     working group. The working group is required to submit its 
     recommendations for appropriate measures to address the 
     impediments to effective enforcement of medical support as 
     well as recommendations on other issues as specified in the 
     statute, to the Secretaries of Health and Human Services and 
     Labor no later than 18 months after the date of enactment. 
     The Secretary of HHS should use its child support technical 
     assistance budget for special projects (per Section 452(j) of 
     the Title IV-D program under the Social Security Act (42 
     U.S.C. 652(j) as authorized by Section 354(a) of the Personal 
     Responsibility and Work Opportunity Reconciliation Act of 
     1996) to hire an outside facilitator to moderate and staff 
     Workgroup proceedings. The Secretaries are required to submit 
     their joint report to Congress no later than 2 months after 
     they receive the recommendations of the working group.
       In general, the agreement would follow the Senate provision 
     with respect to the development and promulgation by 
     regulation of a

[[Page S7319]]

     National Medical Support Notice to be issued by the States as 
     a means of ensuring that the medical support provisions in a 
     child support order are properly carried out. States' use of 
     the National Medical Support Notice will ensure enrollment of 
     the child in available health care coverage, as appropriate. 
     The National Medical Support Notice (1) is to conform to the 
     provisions specified in section 609(a)(3) of ERISA 
     (irrespective of whether the group health plan is covered by 
     reason of section 4 of such Act), and (2) is to include a 
     separate and easily severable employer withholding notice 
     (which can be made severable in any reasonable manner and not 
     limited to perforated paper). Interim regulations for the 
     National Medical Support Notice would be required within 10 
     months of the date of enactment, and final regulations no 
     later than 1 year after the issuance of the interim 
     regulations.
       The agreement requires State Child Support Enforcement 
     agencies to use the National Medical Support Notice to 
     transfer notice of provision of health care coverage for the 
     child to the non-custodial parent's employer (unless 
     alternative coverage is allowed for in any order of the court 
     or other entity issuing the order). The employer is then 
     required, within 20 business days, to send the national 
     notice, excluding the employer withholding notice, to the 
     appropriate plan providing health care coverage for which the 
     child is eligible. The employer withholding notice is also to 
     inform the employer of applicable provisions of state law 
     (and related information) requiring the employer to withhold 
     any employee contributions due as may be required to 
     enroll the child under such plan.
       The agreement requires all plan administrators who receive 
     an appropriately completed National Medical Support Notice to 
     comply with such notice. The plan administrator is then to 
     report back to the State within 40 business days of the date 
     of the Notice whether coverage is available, whether the 
     child is covered and the date of coverage, and if the child 
     is not covered and coverage is available, any steps needed to 
     enroll the child under the plan. The agreement also requires 
     the plan administrator to provide to the custodial parent (or 
     substituted official) any forms or documents (including any 
     health care cards and claim forms) necessary to enroll the 
     child in coverage and ensure access to such coverage. Nothing 
     in this provision is to be construed as requiring a covered 
     group health plan to provide benefits (or eligibility for 
     such benefits) which are not otherwise provided under the 
     terms of the plan.
       It is expected that federal plans will also comply with 
     these requirements.
       The agreement also applies the requirements of the National 
     Medical Support Notice to certain other plans that are not 
     covered under section 609 of ERISA.


            sec. 402. safeguard of new employee information

       Present law
       No provision.
       House bill
       No provision.
       Senate amendment
       The Senate amendment would impose a fine of $1,000 for each 
     act of unauthorized access to, disclosure of, or use of 
     information in the National Directory of New Hires. It would 
     also require that data entered into the National Directory of 
     New Hires be deleted 24 months after the date of entry for 
     individuals who have a child support order. For an individual 
     who does not have a child support order, the data would be 
     required to be deleted after 12 months.
       Agreement
       The agreement follows the Senate amendment with 
     modifications. The $1,000 fine is retained and the Social 
     Security Administration (SSA), which maintains the New Hires 
     data base under contract with HHS, must delete the New Hire 
     and wage and unemployment compensation data within 24 months 
     after receipt. However, HHS will not have access to the wage 
     and unemployment compensation data after 12 months for 
     individuals who have not been found to have a child support 
     order. The Secretary may retain data on a sample of cases for 
     research purposes. In addition, the Secretary must inform 
     Congress within 90 days after enactment of the purposes for 
     which the New Hire and wage and unemployment compensation 
     data will be used. The Secretary must also inform Congress at 
     least 30 days before the data is to be used for a purpose not 
     specified in the original report. Within 3 years after 
     enactment, the Secretary must report to Congress on the 
     accuracy of New Hire data and the effectiveness of the 
     procedures designed to safeguard the New Hire information.


  sec. 403. conforming amendments regarding the collection and use of 
 social security numbers for the purposes of child support enforcement

       Present law
       Federal law (section 205(c)(2)(C) allows any State (or 
     subdivision of the State) to use Social Security account 
     numbers in the administration of any tax, public assistance, 
     driver's license, or motor vehicle registration laws within 
     its jurisdiction to identify individuals affected by such 
     laws.
       House bill
       No provision.
       Senate amendment
       The Senate amendment revises the current statute to reflect 
     the social security numbers also must be used by the agencies 
     administering the renewal of professional licenses, driver's 
     licenses, occupational licenses, or recreational licenses to 
     respond to requests for information from Child Support 
     Enforcement agencies; and that all divorce decrees, support 
     orders, paternity determinations and paternity 
     acknowledgments must include the social security number of 
     the applicable individuals for the purpose of responding to 
     requests for information from Child Support Enforcement 
     agencies.
       Agreement
       The agreement follows the House bill; i.e., no provision.


 sec. 404. clarification of definition regarding high-volume automated 
              administrative enforcement of child support

       Present law
       Federal law (section 466(a)(14) of the Social Security Act, 
     as amended by section 5550 of P.L. 105-33) requires States to 
     conduct ``high-volume automated administrative enforcement,'' 
     to the same extent as used for intrastate cases, in response 
     to a request made by another state to enforce a child support 
     order and promptly report the results of such enforcement 
     procedures to the requesting state. Federal law also defines 
     ``high-volume automated administrative enforcement.''
       House bill
       No provision.
       Senate amendment
       The Senate amendment eliminates the definition of ``high-
     volume automated administrative enforcement'' from the 
     statute.
       Agreement
       The agreement replaces the definition of ``high-volume 
     automated administrative enforcement'' in current law with a 
     clearer definition. The new definition requires states, upon 
     request from another state in an interstate case, to use 
     automated data matches with financial institutions and other 
     entities to locate the obligor's assets and, when assets are 
     discovered, to seize these asset through levy or other 
     appropriate process. The agreement also includes a provision 
     allowing the Secretary, through the Federal Parent Locator 
     Service, to help States work with financial institutions 
     doing business in 2 or more states. The Secretary may send 
     identifying information to such financial institutions on all 
     individuals who owe past-due child support in any state. The 
     financial institutions will then transmit back to the 
     Secretary the identifying information on individuals who owe 
     past-due support for whom they have accounts; the Secretary 
     will transmit this information back to the state that 
     submitted the identifying information. The State will take 
     appropriate actions to seize the assets. This provision does 
     not allow the Secretary to have access to any financial 
     information on individuals holding accounts in these 
     financial institutions. Multi-state financial institutions 
     that respond to requests for information from the Secretary 
     are not expected to respond to such requests from any state 
     for which they have accepted information from the Secretary. 
     However, states that now conduct these data matches with 
     financial institutions that do business in 2 or more states 
     may continue such procedures until January 1, 2000. This 
     provision is not intended to prohibit a State from requiring 
     any financial institution doing business in the State to 
     report account information directly to the State for purposes 
     other than child support enforcement. Financial institutions 
     that provide identifying information to the Secretary or 
     seize assets at the request of States are not liable under 
     State or Federal law for such actions.


              sec. 405. general accounting office reports

       Present law
       No provision.
       House bill
       No provision.
       Senate amendment
       The Senate amendment would require the Comptroller General 
     of the United States (i.e., the General Accounting Office) to 
     report to Congress, no later than December 31, 1998, on the 
     feasibility of implementing an instant check system for 
     employers to use in identifying individuals with child 
     support orders. The report is to include a review of the use 
     of the Federal Parent Locator Service, including the Federal 
     Case Registry of Child Support Orders and the National 
     Directory of New Hires, and the adequacy of the privacy 
     protections.
       Agreement
       The agreement follows the Senate amendment.


 sec. 406. technical corrections (this provision is section 401 of the 
                              house bill)

       Present law
       Under section 473A of the Social Security Act (as 
     established by P.L. 105-89), States may receive financial 
     incentives for increasing their number of adoptions of foster 
     children, above an annual base level. In determining the base 
     levels for each State, the Secretary will use data from the 
     Adoption and Foster Care Analysis and Reporting System 
     (AFCARS). However, in determining the base levels for fiscal 
     years 1995 through 1997, the Secretary may use alternative 
     data sources, as reported by a State by November 30, 1997, 
     and approved by the Secretary by March 1, 1998.

[[Page S7320]]

       Under Section 466(a)(13) of the Social Security Act (as 
     established by P.L. 104-193 and amended by P.L. 105-33), 
     states must have procedures requiring that the social 
     security number of an applicant for a professional license, 
     driver's license, occupational license, recreational, or 
     marriage license be recorded on the application. In 
     addition, the social security number of a person subject 
     to a divorce decree, support order, or paternity 
     determination or acknowledgment must be placed in the 
     records relating to the matter. Also social security 
     numbers must be recorded on death certificates. The 
     statute permits the state to use a number other than the 
     social security number in some cases. If a state chooses 
     this option, it must still keep the social security number 
     of the applicant on file.
       The Illegal Immigration Reform and Immigrant Responsibility 
     Act of 1996 required States to collect social security 
     numbers on applications for State licenses for purposes of 
     checking the identity of immigrants by October 1, 2000.
       House bill
       The current law on alternative data sources to calculate 
     the adoption incentive amount only allowed the use of data 
     reported by States by November 30, 1997 and approved by the 
     Secretary by March 1, 1998. The new provision provides States 
     with an additional 5 months to report data (until April 30, 
     1998) and the Secretary with an additional 4 months to 
     approve the data (until July 1, 1998).
       The House bill changes the January 1, 1998 date in the 1996 
     welfare reform law pertaining to State licenses to October 1, 
     2000, or such earlier date as the State selects.
       Senate amendment
       Same.
       Agreement
       The Agreement follows the House bill and the Senate 
     amendment with some additional technical amendments. The 
     State data reporting on child support enforcement required 
     under section 469 of the Social Security Act is simplified. 
     The provision on eligibility for services in the Welfare-to-
     Work program authorized by section 403(a)(5) of the Social 
     Security Act is clarified by allowing states to provide 
     services to noncustodial parents of children who meet the 
     qualifications for benefits under the program. Two sections 
     of the Child Support Enforcement statute at Title IV-D of the 
     Social Security Act regarding the use of the Federal Parent 
     Locator Service (FPLS) are clarified. Language on use of the 
     FPLS for making or enforcing child custody or visitation 
     orders is removed from section 453 where it had been placed 
     inadvertently by legislation enacted in 1997. The language on 
     use of the FPLS in cases of parental kidnaping, child 
     custody, or parental visitation is located in section 463. 
     This statute requires States to receive and transmit to the 
     Secretary requests from authorized persons (State agents, 
     attorneys, or courts). The provisions of section 463, which 
     carefully balance the rights of children, custodial parents, 
     and noncustodial parents, are intended to ensure that the 
     FPLS is used in an even-handed fashion to assist both parents 
     in achieving access to their children under appropriate 
     circumstances. States must honor the requests of noncustodial 
     parents to have access, through local courts, to information 
     in the FPLS if the procedures of section 463 are followed.

                    Title V. Immigration Provisions


    Sec. 501. Aliens Ineligible to Receive Visas and Excluded from 
               Admission for Nonpayment of Child Support

       Present law
       No comparable provision. The Immigration and Nationality 
     Act (INA) enumerates a number of reasons why an alien may be 
     ineligible to receive visas and excluded from admission, 
     including the likelihood of becoming a public charge, but 
     failure to pay child support is not among them.
       House bill
       Amends the INA to makes inadmissible any alien legally 
     obligated to pay child support whose failure to pay has 
     resulted in an arrearage exceeding $5,000, until child 
     support payments are made or the alien is in compliance with 
     an approved payment agreement. Extends applicability to 
     aliens previously admitted for permanent residence (i.e., as 
     immigrants) who are seeking readmission. Authorizes the 
     Attorney General to waive inadmissibility in a given case if 
     he or she: (1) has received a waiver request from the court 
     or administrative agency with jurisdiction over the child 
     support case; and (2) determines that granting the waiver 
     would substantially increase the likelihood that past and 
     future child support payments would be made.
       Senate amendment
       No provision.
       Agreement
       The agreement follows the Senate amendment except that the 
     Secretary of HHS is required to write a report, after 
     consulting with the Immigration and Naturalization Service 
     (INS), on the feasibility of enacting the provision on child 
     support enforcement against aliens in the House bill. The 
     report, which must be delivered to Congress within 6 months 
     of enactment, must include an assessment of whether the INS 
     can effectively implement the requirements of the House 
     provision.


  Sec. 502. Effect of Nonpayment of Child Support on Establishment of 
                          good Moral Character

       Present law
       No comparable provision in the reasons given in the INA for 
     a determination that an alien is not a person of good moral 
     character; such a determination is necessary for an immigrant 
     to naturalize.
       House bill
       Amends the INA to preclude a finding of good moral 
     character, and thus naturalization, if a person obligated to 
     pay child support has failed to do so, with the opportunity 
     to overcome this either by meeting the child support 
     obligation or complying with an approved payment agreement.
       Senate amendment
       No provision.
       Agreement
       The agreement follows the Senate amendment; i.e., no 
     provision


 sec. 503. authorization to serve legal process in child support cases 
                       on certain arriving aliens

       Present law
       No comparable provision among the functions Immigration and 
     Naturalization Service (INS) officers are authorized by the 
     INA to perform during the inspections process.
       House bill
       Amends the INA to authorize INS officers, to the extent 
     consistent with state law, to serve an applicant for 
     admission with a writ, order, or summons in a child support 
     case.
       Senate amendment
       No provision.
       Agreement
       The agreement follows the Senate Amendment; i.e., no 
     provision.


sec. 504. authorization to obtain information on child support payments 
                               by aliens

       Present law
       No comparable provision.
       House bill
       Amends the Social Security Act to authorize the Secretary 
     of HHS to respond to requests by the Attorney General or the 
     Secretary of State with information which, in the opinion of 
     the HHS Secretary, may aid them in determining whether an 
     alien owes child support.
       Senate amendment
       No provision.
       Agreement
       The agreement follows the Senate amendment; i.e., no 
     provision.

                                 TABLE 1
------------------------------------------------------------------------
If the paternity establishment performance level
                      is--                            The applicable
-------------------------------------------------      percentage is
   At least (percent)    But less than (percent)
------------------------------------------------------------------------
               80                                             100
               79                       80                      98
               78                       79                      96
               77                       78                      94
               76                       77                      92
               75                       76                      90
               74                       75                      88
               73                       74                      86
               72                       73                      84
               71                       72                      82
               70                       71                      80
               69                       70                      79
               68                       69                      78
               67                       68                      77
               66                       67                      76
               65                       66                      75
               64                       65                      74
               63                       64                      73
               62                       63                      72
               61                       62                      71
               60                       61                      70
               59                       60                      69
               58                       59                      68
               57                       58                      67
               56                       57                      66
               55                       56                      65
               54                       55                      64
               53                       54                      63
               52                       53                      62
               51                       52                      61
               50                       51                      60
                0                       50                       0
------------------------------------------------------------------------


                                 TABLE 2
------------------------------------------------------------------------
 If the support order establishment performance
                   level is--                         The applicable
-------------------------------------------------      percentage is
   At least (percent)    But less than (percent)
------------------------------------------------------------------------
               80                                             100
               79                       80                      98
               78                       79                      96
               77                       78                      94
               76                       77                      92
               75                       76                      90
               74                       75                      88
               73                       74                      86
               72                       73                      84
               71                       72                      82
               70                       71                      80
               69                       70                      79
               68                       69                      78
               67                       68                      77
               66                       67                      76
               65                       66                      75
               64                       65                      74
               63                       64                      73
               62                       63                      72
               61                       62                      71
               60                       61                      70
               59                       60                      69
               58                       59                      68
               57                       58                      67
               56                       57                      66
               55                       56                      65
               54                       55                      64
               53                       54                      63
               52                       53                      62
               51                       52                      61
               50                       51                      60
                0                       50                       0
------------------------------------------------------------------------


[[Page S7321]]


                                 TABLE 3
------------------------------------------------------------------------
  If the current payment performance level is--
-------------------------------------------------     The applicable
   At least (percent)    But less than (percent)       percentage is
------------------------------------------------------------------------
               80                                             100
               79                       80                      98
               78                       79                      96
               77                       78                      94
               76                       77                      92
               75                       76                      90
               74                       75                      88
               73                       74                      86
               72                       73                      84
               71                       72                      82
               70                       71                      80
               69                       70                      79
               68                       69                      78
               67                       68                      77
               66                       67                      76
               65                       66                      75
               64                       65                      74
               63                       64                      73
               62                       63                      72
               61                       62                      71
               60                       61                      70
               59                       60                      69
               58                       59                      68
               57                       58                      67
               56                       57                      66
               55                       56                      65
               54                       55                      64
               53                       54                      63
               52                       53                      62
               51                       52                      61
               50                       51                      60
               49                       50                      59
               48                       49                      58
               47                       48                      57
               46                       47                      56
               45                       46                      55
               44                       45                      54
               43                       44                      53
               42                       43                      52
               41                       42                      51
               40                       41                      50
                0                       40                       0
------------------------------------------------------------------------


                                 TABLE 4
------------------------------------------------------------------------
 If the arrearage payment performance level is--
-------------------------------------------------     The applicable
   At least (percent)    But less than (percent)       percentage is
------------------------------------------------------------------------
               80                                             100
               79                       80                      98
               78                       79                      96
               77                       78                      94
               76                       77                      92
               75                       76                      90
               74                       75                      88
               73                       74                      86
               72                       73                      84
               71                       72                      82
               70                       71                      80
               69                       70                      79
               68                       69                      78
               67                       68                      77
               66                       67                      76
               65                       66                      75
               64                       65                      74
               63                       64                      73
               62                       63                      72
               61                       62                      71
               60                       61                      70
               59                       60                      69
               58                       59                      68
               57                       58                      67
               56                       57                      66
               55                       56                      65
               54                       55                      64
               53                       54                      63
               52                       53                      62
               51                       52                      61
               50                       51                      60
               49                       50                      59
               48                       49                      58
               47                       48                      57
               46                       47                      56
               45                       46                      55
               44                       45                      54
               43                       44                      53
               42                       43                      52
               41                       42                      51
               40                       41                      50
                0                       40                       0
------------------------------------------------------------------------


                                 TABLE 5
------------------------------------------------------------------------
If the cost effectiveness performance level is--
-------------------------------------------------     The applicable
        At least              But less than            percentage is
------------------------------------------------------------------------
             5.00                                             100
             4.50                     4.99                      90
             4.00                     4.50                      80
             3.50                     4.00                      70
             3.00                     3.50                      60
             2.50                     3.00                      50
             2.00                     2.50                      40
             0.00                     2.00                       0
------------------------------------------------------------------------

  Mr. GRASSLEY. It has come to my attention that some States are 
engaging in policies or practices that could create interjurisdictional 
barriers to adoption, such as discontinuance of the registration of 
waiting families with adoption exchanges outside the State, refusal to 
share home studies across State lines, and refusal to respond to out-
of-state inquiries. The Adoption and Safe Families Act (P.L. 105-89), 
enacted last year, explicitly established that States shall not take 
any action that would deny or delay a child's adoption when an approved 
family is available outside the child's jurisdiction. In light of these 
recent reports, I urge the Department of Health and Human Services to 
closely monitor State policy and practice with regard to interstate 
adoptions to determine compliance with the new law, to immediately 
report any change of policy or practice in this area to the States, and 
to impose the full penalty on States which are out of compliance.
  I have been told by some organizations which represent the States' 
interests that they consider Sec. 202 of Public Law 105-89 to be 
ambiguous and that the Adoption and Safe Families Act did not 
necessarily prohibit creating barriers to adoption. Let me make this 
very clear, while the Adoption and Safe Families Act does not 
specifically declare that States shall not create barriers to adoption, 
Congresssional intent is clear that any action that delays an adoption, 
when an approved family is available, would be a violation of the law. 
Thus, policies that might result in such delays would be inconsistent 
with the law's intent. Particularly when viewed in the context of the 
entire Adoption and Safe Families Act, which is designed to promote and 
expedite adoptions, there can be no confusion about Congressional 
intent. In addition, this requirement is not inconsistent with other 
provisions in federal child welfare law that require States to recruit 
a diverse pool of potentially adoptive families, nor should it 
discourage States from developing adoptive families within their own 
borders. The overall goal is to place children for adoption with 
approved families without any unnecessary delay. Simply put, the law 
establishes that States shall not discriminate in adoptive placements 
on the basis of geography.
  Let me give you examples of created barriers: any refusal to return 
phone calls from outside the agency's jurisdiction; the suggestion that 
agencies have a property right which permits them to withhold a 
homestudy from a preadoptive family; the imposition of conditions on 
families from outside the jurisdiction which are different in quantity 
or quality from conditions imposed on families within the jurisdiction; 
or, the refusal to accept home studies performed by duly licensed 
social workers from another jurisdiction without good cause to believe 
those social workers are dishonest or incompetent.
  We have a national crisis on our hands. Thousands of children are 
waiting for families to adopt them. If we don't recognize this, 
children will continue to live out their childhoods in foster care. 
Territory and turf should not come between waiting children and 
adoptive families. Any barrier created to deny or delay an adoptive 
placement is an injustice. Although States can spend hundreds of 
dollars recruiting adoptive families, they need to remember, they do 
not own these families. Their recruitment efforts contribute to a 
national recruitment effort for the nation's waiting children, not just 
their State's children. I recognize that many states are pulling out 
all the stops for kids. But they cannot do all the work. We all must do 
everything we can to ensure that children are united with loving, 
nurturing families, and we cannot let geography get in the way.
  Mr. ROCKEFELLER. Mr. President, I am pleased to join my colleagues in 
support of the Child Support Performance and Incentive Act of 1998. It 
is my firm belief that this legislation will significantly improve the 
financial stability, health and well-being of millions of American 
children. My most sincere thanks to Senators Snowe, Kerry, Jeffords and 
Dodd, who co-sponsored the Child Support Performance Improvement Act of 
1997, the bill that laid much of the groundwork for this legislation in 
the Senate. I would like to thank Senator Jim Jeffords in particular 
for his help in securing the inclusion of vital medical child support 
enforcement provisions in this legislation. I would also like to 
express my appreciation to my colleagues Senators Ted Kennedy and Dan 
Coats for their unwavering commitment to children and for their work on 
securing better medical child support enforcement.
  There is no doubt that child support penalties and incentives 
payments simply do not generate the flash and natural interest that 
other children's issues do. The Child Support Performance and Incentive 
Act of 1998 addresses some very complicated financing formulas, complex 
interactions between the Federal government and state child support 
enforcement agencies and hidden budget implications. Despite its plain 
wrapping, however, effective child support enforcement is one of the 
most important roles the Federal government plays in facilitating a 
real continuum of quality benefits and services for children in this 
country.
  In my role as Governor of West Virginia and later as Senator and 
Chairman of the National Commission on Children, my ultimate goal has 
always been the same: to make sure that all children receive the 
specialized supports necessary to address a wide range of financial, 
emotional and medical needs. Child support is one of the most vital 
sources of support for millions of American children, and the Child 
Support Performance and Incentive Act of 1998 strengthens state 
enforcement of

[[Page S7322]]

these obligations in a variety of areas. I am proud of the fact that my 
state works hard to enforce its child support obligations and does an 
excellent job. It is my hope that this legislation will encourage West 
Virginia and other states do their job even more effectively.
  One of the most important and, unfortunately, overlooked areas of 
child support is the enforcement of medical child support (that is, 
health insurance or medical costs covered by the non-custodial parent). 
Since 1984, Federal law has required state child support enforcement 
agencies to pursue medical support as part of every child support 
order. Despite this requirement, only 60% of national child support 
orders contain a medical support component. In its 1996 review of state 
child support enforcement programs, GAO found that at least 13 states 
were not consistently petitioning to include medical support in their 
general support orders, and 20 states were not enforcing existing 
medical support orders at all.
  Such limited enforcement of medical support is dismal, particularly 
in light of the fact that health insurance and premiums provided 
through a non-custodial parent's health plan are often a child's only 
chance for comprehensive medical care. My colleagues and I have worked 
very hard to make sure that Federal programs such as Medicaid and the 
Children's Health Insurance Program provide quality health care for 
children whose families cannot afford to cover them. While no one could 
care more about these Federal programs than I do, they are not designed 
to be and should not be misused as a backdoor for parents who shirk 
their medical support responsibilities.
  Unfortunately, effective medical child support enforcement is 
thwarted by a lack of standardized communication between state child 
support enforcement agencies and the employers and plan administrators 
responsible for the non-custodial parent's health plan. This is 
particularly true for health plans that are governed by the Employment 
Retirement Income Security Act (ERISA) which represent 50% of all 
employer health plans. With 700,000 children dependent on medical 
support through ERISA-governed plans and an additional 1,000,000 
children dependent on medical support through non-ERISA governed 
medical plans, it is essential that communication between states, 
employers, and plan administrators be as efficient as possible.
  The Child Support Performance and Incentive Act of 1998 seeks to 
improve enforcement of medical support in two ways. First, it orders 
the Secretary of the Department of Health and Human Services to develop 
a medical support incentive measure which would base a percentage of 
each qualified state's annual Federal incentives payment on its ability 
to establish and enforce medical child support. If implemented by 
Congress, this sixth performance measure would be added to the first 
five already included in this legislation: (1) establishment of 
paternity; (2) establishment of child support orders; (3) enforcement 
of current child support orders; (4) enforcement of back child support 
(or ``arrearages''); and (5) cost effectiveness. Once HHS develops this 
medical child support incentive measure, Congress has the 
responsibility to make sure it becomes part of the overall incentives 
program.
  The Child Support Performance and Incentive Act of 1998 also takes 
another important step towards effective medical support enforcement by 
requiring the Secretaries of the Department of Human Services and the 
Department of Labor to develop a National Medical Support Notice as a 
means of enforcing the health care provisions of a child support order. 
Under this new requirement, all states would be required to use and all 
employers and plan administrators would be required to accept the 
National Medical Support Notice as a qualified medical child support 
order under ERISA.
  This standardization is an essential step in ensuring that everyone 
is on the same page when it comes to providing eligible children with 
the health care coverage they deserve. The legislation also requires 
HHS and DoL to bring together a Medical Child Support Work Group 
composed of employers, plan administrators, state child support 
directors, and child advocates which will recommend additional ways to 
remove the remaining barriers to effective medical support. We have 
also required that HHS and DoL submit their recommendations for further 
legislative solutions to improve medical support, including any 
necessary changes to ERISA.
  With $15 to $25 billion each year in uncollected child support, we 
have a long way to go to strengthen our national and state child 
support systems. I am hopeful, however, that the changes brought about 
in this legislation make significant progress towards the ultimate goal 
of ensuring child support for every child who is entitled to it. In 
that regard, I am particularly pleased that medical child support 
enforcement is finally receiving the attention it deserves in the 
context of these broader changes.
  Mr. JEFFORDS. Mr. President, yesterday the House of Representatives 
passed H.R. 3130, the Child Support bill by unanimous consent. Today, 
the Senate will pass the same bill. One provision in the bill affects 
qualified medical child support orders, a provision in the Employee 
Retirement Income Security Act (ERISA), and a matter under the 
jurisdiction of the Committee on Labor and Human Resources. Senators 
Kennedy, Coats and myself were conferees on that provision.
  I would like to express my appreciation to Senator Roth for including 
a description of the changes we agreed upon in his explanatory 
material. It is terribly important that this explanation be made a part 
of the legislative history on medical child support orders..
  There are 700,000 children in the United States today who are 
eligible for medical support from a non-custodial parent. All too often 
when the States attempt to enforce a medical child support order, the 
plan sponsors have had fiduciary concerns regarding some aspect of the 
medical support order and, consequently medical benefits were denied to 
the child. Hopefully, this legislation will alleviate those concerns 
and more children will be covered under private health benefit plans. 
The legislation requires the Departments of Health and Human Services 
and Labor to quickly promulgate a model Medical Support Order form that 
States must use to collect medical support for children. It also 
requires those Secretaries to appoint and to collaborate with a Working 
Group to improve the process by which these medical support orders are 
implemented.
  I am happy that we were able to reach agreement on this important 
language. I want to take this opportunity to thank Senators Kennedy and 
Coats, and their staff, for all their assistance. Also, I thank 
Chairman Bill Goodling of the House Workforce Committee, Chairman Bill 
Roth of the Senate Finance and Senator Jay Rockefeller, for their help 
and guidance in reaching an agreement. In particular, Mr. Bill 
Sweetnam, Senior Counsel to the Finance Committee and Ms. Mary Bissell 
of Senator Rockefeller's staff provided the technical expertise, 
knowledge of State programs and support we needed to finish the job.
  I look forward to the Labor and Human Resources Committee exercising 
its oversight authority to see that this legislation is properly 
implemented and that we work toward improving collection of medical 
child support for every child to which such support is legitimately 
owed.
  Mr. MOYNIHAN. Mr. President, I rise today in support of H.R. 3130, 
the Child Support Performance and Incentive Act of 1998. This 
legislation contains two important components to improve child support 
collections: a better system of making incentive payments to states for 
their performance in collecting child support and a new penalty system 
to help ensure that state child support systems meet basic data 
processing standards. While both of these components are rather 
technical, they do represent concrete steps forward and should result 
in thousands of children--many of them poor--receiving critical 
financial assistance from absent parents, something all too many poor 
children do not receive today.
  In addition, the bill contains provisions to improve enforcement of 
the medical aspects of child support and to help ensure data privacy. 
These latter provisions we owe to the hard work of my colleagues 
Senator Rockefeller and Senator Baucus, and I thank them for these 
improvements to the legislation.

[[Page S7323]]

  Mr. President, I urge H.R. 3130 be passed.
  Mr. GRAHAM. Mr. President, I would like to commend the efforts of the 
conferees of the Child Support Performance and Incentive Act of 1998 
for the hard work they have done to secure passage of child support 
reform legislation. The legislation that has passed the House and 
Senate represents a significant victory for children who are getting 
the support they need from both parents. I am pleased that the 
conferees accepted a provision offered by Senator Grassley and I to 
further enhance the states' efforts along with banks to streamline the 
matching process that is required to gather financial information to 
support our children.
  The changes we have proposed through this provision will allow the 
Federal Parent Locator Service to aid our State agencies in their 
collection efforts. Financial institutions doing business in two or 
more States would be able to use the Federal Parent Locator Service to 
assist them in matching data for child support enforcement purposes. 
The language included in this provision will provide a structure for a 
centralized and coordinated matching process, thereby streamlining data 
matches for the financial institutions and state child support 
enforcement programs. We believe that such measures will prevent the 
duplication of efforts by states and banks and assist us in the 
ultimate aim of getting more money to more children more quickly.
  Mr. LOTT. Mr. President, I ask unanimous consent that the Senate 
concur to the amendments of the House to the amendments of the Senate 
to the bill.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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