[Congressional Record Volume 149, Number 109 (Tuesday, July 22, 2003)]
[Senate]
[Pages S9718-S9736]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CARPER (for himself, Mr. Nelson of Nebraska, and Ms. 
        Collins):
  S. 1443. A bill to amend part A of title IV of the Social Security 
Act to reauthorize the temporary assistance to needy families program, 
and for other purposes; to the Committee on Finance.
  Mr. CARPER. Mr. President, I come to the floor to take this time to 
talk about the reauthorization of welfare reform, the reform launched a 
half dozen years ago. The authorization for those reforms has expired 
once, has been renewed for a year, and will expire again at the end of 
this year.
  When Bill Clinton ran for President in 1992, he said a number of 
things for which he is remembered. He said: It is the economy, stupid. 
And it is always the economy, stupid, as far as I am concerned. But he 
also said we ought to change welfare as we know it. And we have.
  Welfare reform was very much needed in the mid-1990s. A lot of people 
who ended up on welfare stayed there for long periods of time. And one 
of the reasons why they stayed there for so long was because they and 
their families were better off being on welfare than not. If people on 
welfare went to work, they lost some things. They lost maybe health 
care for their kids, eligibility for food stamps, nutritional support 
for their families, affordable housing. They certainly had to pay more 
for affordable housing.
  And what would they gain by going to work and getting off welfare? 
The right to pay taxes: State income taxes, Federal income taxes, 
Social Security taxes, Medicare taxes, and others. After losing those 
certain things and gaining the right to pay those taxes, they would 
have to deal with the costs included in childcare. Who is going to take 
care of my kids? How will I pay for it? How will I get to work? Is 
there transportation? Is there transit? Do I have a car? Is it a 
working car? If I don't, how do I get one or pay for it or maintain it?
  The reforms adopted in 1996 were actually endorsed by the National 
Governors Association which served as a catalyst for the adoption of 
Federal law. There were a number of principles that underscored or 
underwrote that welfare reform initiative of the mid-1990s. The first 
was work first. We should not place emphasis on finding people for jobs 
that may not exist. We ought to help people to go to work first.
  The second principle was, work ought to pay more than welfare. People 
actually ought to be better off because somebody in that family is 
going to work every day.
  The third principle was really a tough love principle. There ought to 
be limits on the amount of time that people could be on welfare. States 
could make it more stringent but a 5-year cap on the amount of time 
people spent on welfare should be the law of the land. We should have a 
tough love approach. There ought to be a certain toughness in what we 
are doing.
  People should show up for job interviews. They should take the jobs 
offered. They should not be able to walk away from the jobs. If they do 
those kinds of things, they would face, in a number of States, the 
likelihood of being sanctioned for their refusal or inability to go to 
work and continue to work.
  We also said that we realize there are some people on welfare who 
will never come off. For reasons physiological, they are going to be 
dependent forever. We allowed the States to recognize some percentage--
I think 20 percent--of the caseload of people who will not go to work.

[[Page S9719]]

  We said that it might be a smart idea to have a rainy day fund, in 
case the economy falls off a cliff or we have a lot more people who 
show up and need a welfare payment. So we provided for a rainy day 
fund.
  Finally, we said there are really four critical elements that need to 
be addressed in order for people to get off welfare and stay off 
welfare for an extended period of time. No. 1, there had to be a job to 
go to. No. 2, they have to have a way to get to the job. No. 3, there 
has to be health care for the kids. If the kids get sick, parents are 
not going to go to work. There has to be minimal health care for the 
family. People will not go to work if there is nobody to take care of 
their kids. So there needs to be some assistance given for childcare.
  By most standards, the welfare reforms we began a half dozen years 
ago are regarded as a success. The rolls are down by roughly half 
across the country, including Delaware. Many families who used to be on 
welfare are now working and those families are, for the most part, 
better off. In those families where somebody is going to work every 
day, that parent sets an example for their children that there is an 
expectation to go to work, that there is dignity with work, and we are 
expected to be self-aligned and self-sufficient, if we are 
psychologically able to do that.
  I have heard the old adage, ``If it ain't broke, don't fix it.'' Some 
people said that about the welfare reforms to be adopted in 1996--that 
they were not broke and we ought not to fix them. Other people said we 
ought to change it substantially, which is what we did in 1996. Some 
would like to go back to a situation that existed prior to that time. 
Others would like to go to an even tougher love arrangement, with the 
emphasis on toughness and not a whole lot of love involved.
  Rather than saying if it ain't broke, don't fix it, I think the 
better approach is to say this: If it is not perfect, make it better. 
The reforms we adopted 6 years ago can be improved upon and we can make 
it better.
  I want to talk about a proposal Senator Nelson and I will be 
offering. As former Governors of our States, we believe it will build 
on the changes adopted in 1996. It would make the system better and 
make it one that is more likely to help people get off welfare and stay 
off for an extended period of time, and hopefully forever.
  When we adopted the welfare reforms of 1996, we decided to take 
welfare, which had been an entitlement program, and make it a block 
grant program. I believe it provided that $16.5 million would be 
distributed to States in block grants and States could apportion that 
money out, to be used for a variety of things, including cash welfare 
payments, childcare assistance, health care, and other things. They 
could also use the money for transportation assistance. We put a 5-year 
limit on the amount of time people, under Federal law, could be 
eligible for welfare benefits. We also said in that law that we want 
States to eventually increase their work participation rates.
  If you look at the welfare caseload, the percentage of people doing 
work or work-like activities, we wanted that to increase so by 2002 the 
work participation would have gone up 50 percent from wherever it 
started. That is where it is today; the work participation rate is 50 
percent.
  We give a credit to States that moved people off of welfare since the 
mid to late 1990s. So if they have moved people off welfare, States can 
get a credit toward the work participation rate, with the 50-percent 
mandate.
  As it turned out, when they moved half of the people off of the 
welfare rolls and the work participation rate is 50 percent effectively 
by moving people off welfare to work, in most of the States we have 
eliminated de facto the work participation rate. Most States have a 
zero work participation rate as a result.

  Our bill changes that in a couple of ways. It gradually raises from 
50 percent to 70 percent, in 5-percent increments each year, the work 
participation rate, so that by 2008, today's rate would go up to 70 
percent.
  We provide for something called an employment credit. The employment 
credit provides a credit to States against its work participation rate 
for doing a couple of things. One, for moving people to work. Two, they 
get bonus credit for moving people to work at better paying jobs. Also, 
States can earn partial credit against the work participation rate if 
people are doing at least 16 hours of core work activities.
  Under the current Federal law, a workweek for people who have kids 
over the age of 6 is 30 hours in order to count toward the work 
participation rate. Under current law, if a person has a child under 6, 
they need to be working 20 hours in order to count toward the States' 
work participation requirement.
  Senator Nelson and I would change that a little bit. We say that--
there is one thing we don't change. If you have a child under the age 
of 6, it is still 20 hours. If they are over the age of 6, we expect 
them to be working 32 hours, 8 of which can be activities other than 
core work activities. An example would be assistance for substance 
abuse, or anything that is deemed to be eliminating the barrier toward 
employment. If a person doesn't have a high school degree, they can be 
working toward their GED, and that counts as part of that 8 hours. But 
24 hours of the 32 would have to be a core work activity. I will give 
you some examples: private sector work, public sector work, community 
service, and vocational education.
  Senator Nelson and I also made a modification with respect to 
education and training. Under current law, vocational education counts 
up to--I believe you count it toward your work participation rate for 
12 months. We make that 24 months. We put in a cap. If you had 100 
people on your caseload, no more than 30 percent of that 100 people who 
are involved in vocational education training or postsecondary can be 
counted toward a State's work participation rate. We extend from 12 
months to 24 months those who are participating in vocational credit.
  If you want people to go to work, you have to make sure there is help 
on the childcare side. If we are going to raise the hours, we expect 
the people to do work or work-like activities. If we are going to raise 
the work participation rate, we have to provide additional assistance. 
There is an extra $6 billion that we provide for childcare over the 5-
year period.
  In addition, we raise the social service block grant to a fully 
authorized level over a 5-year period of time. On the transportation 
side, as I mentioned earlier, unless people can get to work--we can 
have all the caps and participation rates we want but unless people can 
get to work, they are not going to be able to get off welfare and stay 
off of welfare.
  In our legislation, we provide under current law where States can use 
the TANF block grant for transportation assistance. We provide 
authorizing language for another $15 million in authorization for 
transportation. If you live in a rural area and there is no 
transportation, States can help people buy cheaper but working cars to 
get where they need to go.
  We make a change with respect to transitional health care. Under 
current law, if I am on welfare and then I go to work, I lose my health 
care. I can get 12 months of transitional assistance from Medicaid. We 
raise that. We give States the discretion to raise that to 24 months.
  I see Senator Grassley has risen to speak. I will finish my remarks. 
I say this to him. I appreciate very much his effort in leading the 
Finance Committee. Senator Nelson and I have actually been privileged 
to be Governors of our States--8 years apiece--at the time we launched 
welfare reform. We learned a lot from those experiences. We think it is 
germane to the debate that is coming soon in the next steps in welfare 
reform. We hope to be part of the debate--maybe not in your committee 
but certainly when we get the bill to the floor. As much as I 
understand what is taking shape here, I think there are common elements 
in what Senator Grassley is seeking to do and what Senator Nelson and I 
propose to do. We look very much forward to engaging with the chairman 
in the work he is doing now and with that which is going to be brought 
to the floor later this year.
  Mr. President, I ask unanimous consent that the text of this bill 
that Senator Nelson and I are introducing be printed in the Record.

[[Page S9720]]

  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1443

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Building on Welfare Success 
     Act of 2003''.

     SEC. 2. TABLE OF CONTENTS.

       The table of contents of this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. References.
Sec. 4. Findings.

                             TITLE I--WORK

Sec. 101. Increase in minimum participation rates.
Sec. 102. Increase in number of hours required for work and work-
              related activities.
Sec. 103. Treatment of rehabilitative services as an additional work 
              activity.
Sec. 104. Education and training.
Sec. 105. Authority to establish parents as scholars programs.
Sec. 106. Replacement of caseload reduction credit with employment 
              credit.
Sec. 107. Elimination of separate work participation rate for 2-parent 
              families.
Sec. 108. State option to count a caregiver of a family member with a 
              disability or chronic illness as engaged in work.

                 TITLE II--FAMILY PROMOTION AND SUPPORT

 Subtitle A--Family Formation Fund and Teen Pregnancy Prevention Grants

Sec. 201. Promotion of family formation.
Sec. 202. Ban on imposition of stricter eligibility criteria for 2-
              parent families.
Sec. 203. Teen pregnancy prevention grants.
Sec. 204. Teen pregnancy prevention resource center.
Sec. 205. Establishing national goals to prevent teen pregnancy.

        Subtitle B--Child Support Distribution to Families First

                Chapter 1--Distribution Of Child Support

Sec. 211. Distribution of child support collected by States on behalf 
              of children receiving certain welfare benefits.

                    Chapter 2--Expanded Enforcement

Sec. 221. Decrease in amount of child support arrearage triggering 
              passport denial.
Sec. 222. Use of tax refund intercept program to collect past-due child 
              support on behalf of children who are not minors.
Sec. 223. Garnishment of compensation paid to veterans for service-
              connected disabilities in order to enforce child support 
              obligations.
Sec. 224. Mandatory review and adjustment of child support orders for 
              families receiving TANF.
Sec. 225. Improved interstate enforcement.

                        Chapter 3--Miscellaneous

Sec. 231. Report on undistributed child support payments.
Sec. 232. Use of new hire information to assist in administration of 
              unemployment compensation programs.
Sec. 233. Immigration provisions.
Sec. 234. Increase in payment rate to States for expenditures for 
              short-term training of staff of certain child welfare 
              agencies.

                   Subtitle C--Responsible Fatherhood

Sec. 241. Responsible fatherhood grants.
Sec. 242. National clearinghouse for responsible fatherhood programs.
Sec. 243. Block grants to States to encourage media campaigns.

                      TITLE III--STATE FLEXIBILITY

Sec. 301. State option to assist legal immigrant families.
Sec. 302. Optional coverage of legal immigrants under the medicaid 
              program and title XXI.
Sec. 303. 5-year extension and simplification of the transitional 
              medical assistance program (TMA).
Sec. 304. Definition of assistance.
Sec. 305. Clarification of authority of States to use TANF funds 
              carried over from prior years to provide TANF benefits 
              and services.
Sec. 306. Authority to use TANF funds for housing benefits.

                 TITLE IV--RESOURCES AND ACCOUNTABILITY

Sec. 401. Reauthorization of State family assistance grants.
Sec. 402. Reauthorization of supplemental grants for population 
              increases.
Sec. 403. Contingency fund.
Sec. 404. Child care.
Sec. 405. Restoration of funding for the social services block grant.
Sec. 406. Competitive grants for public-private partnerships for 
              educational opportunities for career advancement.
Sec. 407. Grants to improve access to transportation.
Sec. 408. Pathway to self-sufficiency grants to improve coordination of 
              assistance for low-income families.
Sec. 409. Transitional jobs programs.
Sec. 410. GAO study on impact of ban on SSI benefits for legal 
              immigrants.
Sec. 411. Ensuring TANF funds are not used to displace public 
              employees; application of workplace laws to welfare 
              recipients.
Sec. 412. Data collection and reporting.

                         TITLE V--MISCELLANEOUS

Sec. 501. Effective date.

     SEC. 3. REFERENCES.

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

     SEC. 4. FINDINGS.

       Congress makes the following findings:
       (1) The Personal Responsibility and Work Opportunity 
     Reconciliation Act of 1996 (Public Law 104-193; 110 Stat. 
     2105) was a fundamental change to reform the Federal welfare 
     system to shift it from an entitlement program into a 
     transition program to help families move from welfare to work 
     and personal responsibility.
       (2) Since enactment of the 1996 welfare reform law, welfare 
     cash assistance caseloads have dropped dramatically, by 
     approximately 50 percent, and approximately \2/3\ of welfare 
     recipients who have left the cash assistance rolls have left 
     for work.
       (3) Another sign of reform and progress is that funding has 
     shifted from providing monthly cash assistance for parents to 
     stay at home to over \1/2\ of the funding targeted to pay for 
     work supports, such as child care, transportation, job 
     placement, limited job training, or other priorities.
       (4) Investments in child care and transportation, and 
     health care access will help continue this success and move 
     more people from welfare to work.
       (5) While many families have moved from welfare to work, 
     many families struggle in low-wage jobs and have trouble 
     getting promised supports such as medicaid, child care, food 
     stamps, and other supports available under programs intended 
     to help families.
       (6) Child poverty rates in the United States have improved 
     but they could be lower and they remain high when compared to 
     the rates of other developed countries. More must be done to 
     reduce child poverty in our Nation.
       (7) State flexibility has been critical to the success of 
     the 1996 welfare reform law and will be important for States 
     to provide a broad range of services to address parents on 
     welfare with barriers to employment. State flexibility also 
     is important for States to continue successful welfare 
     programs that have cut the caseload in half since 1996.
       (8) Children deserve to be raised in supportive homes, 
     preferably with 2 loving parents. It is crucial to end 
     policies that discriminate against serving 2-parent families 
     within the welfare system. It is also important to support 
     innovative programs to encourage full participation in child 
     support and child rearing by noncustodial parents.
       (9) Despite declining national and State rates, 35 percent 
     of 10 girls in the United States get pregnant at least once 
     by age 20, nearly 900,000 girls get pregnant each year, and 
     there are nearly 500,000 teen births each year. The national 
     teen birth rate for Hispanic teen girls - the fastest growing 
     group - is declining the slowest.
       (10) If teen birth rates had stayed at the 1991 peak level, 
     there would have been at least 800,000 additional babies born 
     to teenagers.

                             TITLE I--WORK

     SEC. 101. INCREASE IN MINIMUM PARTICIPATION RATES.

       The table set forth in section 407(a)(1) (42 U.S.C. 
     607(a)(1)) is amended--
       (1) in the item relating to fiscal year 2002--
       (A) by striking ``or thereafter'' and inserting ``2003, or 
     2004''; and
       (B) by striking the period; and
       (2) by adding at the end the following:

      ``2005......................................................55   
       2006.......................................................60   
       2007.......................................................65   
       2008 or thereafter......................................70.''.  

     SEC. 102. INCREASE IN NUMBER OF HOURS REQUIRED FOR WORK AND 
                   WORK-RELATED ACTIVITIES.

       Section 407(c)(1) (42 U.S.C. 607(c)(1)), as amended by 
     section 107(3), is amended--
       (1) in the matter preceding the table set forth in that 
     paragraph, by striking ``20 hours'' and inserting ``24 
     hours''; and
       (2) in the table--
       (A) in the item relating to fiscal year 2000, by striking 
     ``or thereafter'' and inserting ``, 2001, 2002, or 2003'';
       (B) by striking the period at the end; and
       (C) by adding at the end the following:

       2004 or thereafter......................................32.''.  

     SEC. 103. TREATMENT OF REHABILITATIVE SERVICES AS AN 
                   ADDITIONAL WORK ACTIVITY.

       (a) In General.--Section 407(d) (42 U.S.C. 607(d)) is 
     amended--
       (1) in paragraph (11), by striking ``and'' at the end;
       (2) in paragraph (12), by striking the period and inserting 
     ``; and''; and
       (3) by adding at the end the following:

[[Page S9721]]

       ``(13)(A) rehabilitative services, such as adult basic 
     education, participation in a program designed to increase 
     proficiency in the English language, or, in the case of an 
     individual determined by a qualified medical, mental health, 
     or social services professional as having a physical or 
     mental disability, substance abuse problem, or other problem 
     that requires rehabilitative services, substance abuse 
     treatment, mental health treatment, or other rehabilitative 
     services, provided that the provision of such services is a 
     requirement of the individual's individual responsibility 
     plan under section 408(b) (not to exceed 3 months out of any 
     24-month period, or, if such services for a longer period of 
     time is a requirement of the individual's plan under section 
     408(b), up to 6 months, but only if, during the last 3 months 
     of such 6 months, such services are combined with work or 
     job-readiness activities); and
       ``(B) for purposes of counting toward the minimum average 
     number of hours per week specified in subsection (c)(1), 
     services described in subparagraph (A), the provision of 
     which is a requirement of the individual's individual 
     responsibility plan under section 408(b), until an individual 
     successfully completes such services (and without regard to 
     the time limits for the receipt of such services for purposes 
     of subparagraph (A).''.
       (b) Conforming Amendments.--Section 407(c)(1) (42 U.S.C. 
     607(c)(1)), as amended by sections 102 and 107(3), is amended 
     by striking ``or (12)'' and inserting ``(12), or (13)(A)''.

     SEC. 104. EDUCATION AND TRAINING.

       (a) Increase in Months for Vocational Educational Training 
     To Count as a Work Activity.--Section 407(d)(8) is amended to 
     read as follows:
       ``(8) vocational educational training (not to exceed 24 
     months with respect to any individual);''.
       (b) State Option To Treat Participants in Postsecondary 
     Education Program Established by the State as Engaged In 
     Work.--Section 407(c)(2) (42 U.S.C. 607(c)(2)) is amended by 
     adding at the end the following:
       ``(E) State option to treat participants in postsecondary 
     education program established by the State as engaged in 
     work.--In the case of a State that elects to establish a 
     postsecondary education program under section 404(l), the 
     State may include, for purposes of determining monthly 
     participation rates under subsection (b)(1)(B)(i), all 
     families that include an individual participating in such 
     program during the month as being engaged in work for the 
     month, so long as each such individual is in compliance with 
     the requirements of that program.''.
       (c) Elimination of Recipients Completing Secondary School 
     From Limit on Number of TANF Recipients Participating in 
     Vocational Educational Training.--
       (1) In general.--Section 407(c)(2)(D) (42 U.S.C. 
     607(c)(2)(D)) is amended to read as follows:
       ``(D) Limitation on number of persons who may be treated as 
     engaged in work by reason of participation in vocational 
     educational training.--For purposes of determining monthly 
     participation rates under subsection (b)(1)(B)(i), not more 
     than 30 percent of the number of individuals in all families 
     in a State who are treated as engaged in work for a month may 
     consist of individuals who are determined to be engaged in 
     work for the month by reason of participation in vocational 
     educational training (determined without regard to 
     individuals described in subparagraph (C) or participating in 
     a program referred to in subparagraph (E)).''.
       (2) Conforming amendment.--Section 407(c)(2)(C)(ii) (42 
     U.S.C. 607(c)(2)(C)(ii) is amended by inserting ``including 
     vocational educational training'' after ``employment''.

     SEC. 105. AUTHORITY TO ESTABLISH PARENTS AS SCHOLARS 
                   PROGRAMS.

       Section 404 (42 U.S.C. 604) is amended by adding at the end 
     the following:
       ``(l) Authority to Establish Parents as Scholars 
     Programs.--
       ``(1) In general.--A State to which a grant is made under 
     section 403 may use the grant to establish a parents as 
     scholars program under which an eligible participant may be 
     provided support services described in paragraph (4) based on 
     the participant's need in order to complete the program.
       ``(2) Definition of eligible participant.--
       ``(A) In general.--In this subsection, the term `eligible 
     participant' means an individual who receives assistance 
     under the State program funded under this part and satisfies 
     the following requirements:
       ``(i) The individual is enrolled as a full-time student in 
     a postsecondary 2- or 4-year degree program.
       ``(ii) The individual does not have a marketable bachelor's 
     degree.
       ``(iii) The individual does not have the skills necessary 
     to earn at least 85 percent of the median wage for the State 
     or locality in which the individual resides.
       ``(iv) The individual is--

       ``(I) pursuing a degree that will improve the individual's 
     ability to support the individual's family, considering the 
     local labor market and employment opportunities; and
       ``(II) demonstrating an ability to succeed in the 
     educational program that has been chosen.

       ``(v) The individual participates in a combination of 
     education, training, study or worksite experience for an 
     average of not less than 20 hours per week (including time 
     spent studying at 150 percent of time spent in class).
       ``(vi) After the first 24 months of participation in the 
     program, the individual--

       ``(I) works not less than 15 hours per week (in addition to 
     school and study time); or
       ``(II) engages in a combination of class hours, study hours 
     (including time spent studying at 150 percent of time spent 
     in class) and work for a total of not less than 32 hours per 
     week.

       ``(vii) During the period the individual participates in 
     the program, the individual--

       ``(I) maintains not less than a 2.0 grade point average;
       ``(II) attends classes as scheduled;
       ``(III) reports to the individual's caseworker for the 
     program any changes that might affect the individual's 
     participation;

       ``(IV) provides the individual's caseworker with a copy of 
     any financial aid award letters; and
       ``(V) provides the individual's caseworker with the 
     individual's semester grades as requested.

       ``(B) Definition of full-time student.--
       ``(i) In general.--For purposes of subparagraph (A)(i), an 
     individual shall be considered a full-time student if such 
     individual is taking courses having the number of hours 
     needed under the requirements of the educational institution 
     in which the individual is enrolled, to complete the 
     requirements of a degree within the usual timeframe of 2 or 4 
     years, as applicable.
       ``(ii) Exception.--The State may, for good cause, modify 
     the number of hours required under clause (i) to allow 
     additional time, not to exceed 150 percent of the usual 
     timeframe required for completion of a 2- or 4-year degree, 
     for an individual to complete a degree and be considered a 
     full-time student under a program established under this 
     subsection.
       ``(3) Modification of eligible participant requirements.--A 
     State may, for good cause, modify the requirements for an 
     eligible participant set forth in paragraph (2)(A).
       ``(4) Support services described.--For purposes of 
     paragraph (1), the support services described in this 
     paragraph include 1 or more of the following during the 
     period the eligible participant is in the program established 
     under this subsection:
       ``(A) Child care for children under age 13 or for children 
     who are physically or mentally incapable of caring for 
     themselves.
       ``(B) Transportation services, including--
       ``(i) mileage at a set rate per mile or reimbursement for 
     public or private transportation;
       ``(ii) payment for automotive repairs, not to exceed $500 
     per academic year on a vehicle registered to the eligible 
     participant; and
       ``(iii) reimbursement for vehicle liability insurance, not 
     to exceed $300, for the eligible participant's vehicle.
       ``(C) Payment for books and supplies to the extent that 
     such items are not covered by grants and loans, not to exceed 
     $750 per academic year.
       ``(D) Such other expenses, not to exceed $500, that the 
     State determines are necessary for the eligible participant 
     to complete the program established under this subsection and 
     that are not covered by any other available support services 
     program.''.

     SEC. 106. REPLACEMENT OF CASELOAD REDUCTION CREDIT WITH 
                   EMPLOYMENT CREDIT.

       (a) Employment Credit to Reward States in Which Families 
     Leave Welfare for Work; Additional Credit for Families With 
     Higher Earnings.--
       (1) In general.--Section 407(b) (42 U.S.C. 607(b)), as 
     amended by section 107(2)(A), is amended by inserting after 
     paragraph (1) the following:
       ``(2) Employment credit.--
       ``(A) In general.--The participation rate determined under 
     paragraph (1) of a State for a fiscal year shall be increased 
     by the lesser of--
       ``(i) the number of percentage points (if any) of the 
     employment credit for the State for the fiscal year; or
       ``(ii) the number of percentage points (if any) by which 
     the participation rate, so determined, is less than 100 
     percent.
       ``(B) Calculation of credit.--
       ``(i) In general.--The employment credit for a State for a 
     fiscal year is an amount equal to--

       ``(I) twice the average quarterly number of families with 
     an adult that ceased to receive assistance under the State 
     program funded under this part during the preceding fiscal 
     year (but only if the adult did not receive such assistance 
     for at least 2 months after the cessation) and that was 
     employed during the calendar quarter immediately succeeding 
     the quarter in which the payments ceased; divided by
       ``(II) the average monthly number of families that include 
     an adult who received cash payments under the State program 
     funded under this part during the preceding fiscal year.

       ``(ii) Special rule for former recipients with higher 
     earnings.--In calculating the employment credit for a State 
     for a fiscal year, a family that,in the quarter in which the 
     wage was examined, earned at least 50 percent of the average 
     quarterly wage in the State (determined on the basis of State 
     unemployment data) shall be considered to be 1.5 families.
       ``(C) Regulations.--The Secretary may prescribe such 
     regulations as may be necessary to carry out this paragraph.
       ``(D) Reports on amount of credit.--Not later than 6 months 
     after the end of each calendar quarter, the Secretary shall 
     report to Congress and each State the amount of the 
     employment credit for the State for the quarter. The 
     Secretary may carry out this

[[Page S9722]]

     subparagraph using funds made available under this part for 
     research.''.
       (2) Authority of secretary to use information in national 
     directory of new hires.--Section 453(i) (42 U.S.C. 653(i)) is 
     amended by adding at the end the following:
       ``(5) Calculation of employment credit for purposes of 
     determining state work participation rates under tanf.--The 
     Secretary may use the information in the National Directory 
     of New Hires for purposes of calculating State employment 
     credits pursuant to section 407(b)(2).''.
       (3) Elimination of caseload reduction credit.--Section 
     407(b), as amended by paragraph (1) and section 107(2)(A), is 
     amended by striking paragraph (3) and redesignating 
     paragraphs (4) and (5) as paragraphs (3) and (4), 
     respectively.
       (b) States to Receive Partial Credit Toward Work 
     Participation Rate for Recipients Engaged in Part-Time 
     Work.--Section 407(c)(1) (42 U.S.C. 607(c)(1)), as amended by 
     section 107(3), is amended by adding at the end the following 
     flush sentence: ``For purposes of subsection (b)(1)(B)(i), a 
     family that does not include a recipient who is participating 
     in work activities for an average of 32 hours per week during 
     a month but includes a recipient who is participating in such 
     activities during the month for an average of at least 50 
     percent of the minimum average number of hours per week 
     specified for the month in the table set forth in this 
     subparagraph shall be counted as a percentage of a family 
     that includes an adult or minor child head of household who 
     is engaged in work for the month, which percentage shall be 
     the number of hours for which the recipient participated in 
     such activities during the month divided by the number of 
     hours of such participation required of the recipient under 
     this section for the month.''.
       (c) TANF Recipients Who Qualify for Supplemental Security 
     Income Benefits Removed from Work Participation Rate 
     Calculation for Entire Year.--Section 407(b)(1)(B)(ii) (42 
     U.S.C. 607(b)(1)(B)(ii)) is amended--
       (1) in subclause (I), by inserting ``who has not become 
     eligible for supplemental security income benefits under 
     title XVI during the fiscal year'' before the semicolon; and
       (2) in subclause (II), by inserting ``, and that do not 
     include an adult or minor child head of household who has 
     become eligible for supplemental security income benefits 
     under title XVI during the fiscal year'' before the period.
       (d) Effective Date.--The amendments made by this section 
     take effect on October 1, 2005.

     SEC. 107. ELIMINATION OF SEPARATE WORK PARTICIPATION RATE FOR 
                   2-PARENT FAMILIES.

       Section 407 (42 U.S.C. 607) is amended--
       (1) in subsection (a)--
       (A) in the heading of paragraph (1), by striking ``All 
     families'' and inserting ``In general''; and
       (B) by striking paragraph (2);
       (2) in subsection (b)--
       (A) by striking paragraph (2);
       (B) in paragraph (4), by striking ``paragraphs (1)(B) and 
     (2)(B)'' and inserting ``paragraph (1)(B)''; and
       (C) in paragraph (5), by striking ``rates'' and inserting 
     ``rate''; and
       (3) in subsection (c)(1)--
       (A) by striking ``General rules.--'' and all that follows 
     through ``For purposes'' in subparagraph (A) and inserting 
     ``General rule.--For purposes''; and
       (B) by striking subparagraph (B).

     SEC. 108. STATE OPTION TO COUNT A CAREGIVER OF A FAMILY 
                   MEMBER WITH A DISABILITY OR CHRONIC ILLNESS AS 
                   ENGAGED IN WORK.

       Section 407(c)(2) (42 U.S.C. 607(c)(2)) is amended by 
     adding at the end the following:
       ``(E) State option to count a caregiver of a family member 
     with a disability or chronic illness as engaged in work.--
       ``(i) In general.--If a State determines that a recipient 
     is needed to provide care for a child with a physical or 
     mental disability or chronic illness (as defined by the 
     State), or an adult relative with a physical or mental 
     disability or chronic illness (as so defined), the State may 
     deem the recipient to be engaged in work for purposes of 
     determining the monthly participation rate under subsection 
     (b)(1)(B)(i).
       ``(ii) Inclusion in individual responsibility plan; annual 
     review.--The need to provide care described in clause (i) 
     shall be specified in the recipient's individual 
     responsibility plan established under section 408(b) and 
     reviewed not less than annually.
       ``(iii) Engagement in other activity.--Nothing in clause 
     (i) or (ii) shall be construed as prohibiting a State from 
     determining that, taking into consideration the needs of the 
     child or adult relative with a physical or mental disability 
     or chronic illness, an adult recipient who provides care for 
     such child or adult relative can engage in some other 
     additional work activity, or another activity that may lead 
     to work, for all or a portion of the time required to meet 
     the work requirement under the State program funded under 
     this part.''.

                 TITLE II--FAMILY PROMOTION AND SUPPORT

 Subtitle A--Family Formation Fund and Teen Pregnancy Prevention Grants

     SEC. 201. PROMOTION OF FAMILY FORMATION.

       Section 403(a) (42 U.S.C. 603(a)) is amended by adding at 
     the end the following:
       ``(6) Family formation grants.--
       ``(A) Authority.--
       ``(i) In general.--The Secretary shall award competitive 
     grants to States, Indian tribes, nonprofit entities, and 
     charitable or religious organizations for the cost of 
     developing and implementing healthy marriage promotion 
     programs.
       ``(ii) Application.--A State, Indian tribe, nonprofit 
     entity, or a charitable or religious organization desiring a 
     grant under this paragraph shall submit an application to the 
     Secretary at such time, in such manner, and containing such 
     information as the Secretary may require.
       ``(B) Permissible activities.--Funds provided under a grant 
     awarded under this paragraph may be used for programs or 
     activities that are designed to promote healthy and stable 
     marriage, including the following:
       ``(i) Voluntary marriage and relationship skills education 
     programs for nonmarried pregnant women and nonmarried 
     expectant fathers.
       ``(ii) Voluntary premarital education and marriage and 
     relationship skills education for engaged couples and for 
     couples interested in marriage.
       ``(iii) Voluntary marriage enhancement and marriage and 
     relationship skills education programs for married couples 
     including mediation services and couples counseling.
       ``(iv) Teen pregnancy prevention programs, including the 
     prevention of repeat pregnancies.
       ``(v) Domestic violence prevention programs for training 
     and technical assistance activities to be provided to other 
     entities funded under this subparagraph.
       ``(C) Grants selection criteria.--
       ``(i) In general.--The Secretary shall promulgate for 
     public comment criteria for selecting grant proposals to be 
     funded under subparagraph (B). Such criteria shall--

       ``(I) set forth a grant review process that includes 
     independent experts, including individuals with expertise in 
     programs for low-income families, programs addressing teen 
     pregnancy prevention, programs addressing teen parenting or 
     youth development, programs addressing domestic violence, 
     program research, and program administration, and shall be 
     designed to ensure that an individual shall not be involved 
     in the grant selection process if such involvement would pose 
     a conflict of interest for the individual;
       ``(II) specify grantee qualifications and requirements, 
     including a requirement that grant applications provide 
     financial information, including a copy of the applicant's 
     most recent audit report, and shall require grantees to agree 
     to maintain such records, make such reports, and cooperate 
     with such reviews or audits as the Secretary may find 
     necessary for purposes of oversight of project activities and 
     expenditures;
       ``(III) require grant proposals to identify community 
     support and include a plan to collaborate with appropriate 
     public and community-based organizations and service 
     providers; and
       ``(IV) require grant proposals to describe the methods the 
     applicant plans to use to recruit project participants and 
     the applicant's plan to evaluate project implementation, 
     operation, and outcomes, and to demonstrate that there is a 
     sufficient number of potential participants to conduct the 
     evaluation.

       ``(ii) Oversight of evaluations.--The Secretary shall 
     ensure that there is an appropriate evaluation for all grant 
     proposals funded under subparagraph (B), including use of 
     random assignment in appropriate instances.
       ``(D) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there is 
     appropriated for making grants under this paragraph--
       ``(i) for fiscal year 2004, $75,000,000;
       ``(ii) for fiscal year 2005, $100,000,000;
       ``(iii) for fiscal year 2006, $150,000,000;
       ``(iv) for fiscal year 2007, $175,000,000; and
       ``(v) for fiscal year 2008, $200,000,000.''.

     SEC. 202. BAN ON IMPOSITION OF STRICTER ELIGIBILITY CRITERIA 
                   FOR 2-PARENT FAMILIES.

       (a) Prohibition.--Section 408(a) (42 U.S.C. 608(a)) is 
     amended by adding at the end the following:
       ``(12) Ban on imposition of stricter eligibility criteria 
     for 2-parent families.--In determining the eligibility of a 
     2-parent family for assistance under a State program funded 
     under this part, the State shall not impose a requirement 
     that does not apply in determining the eligibility of a 1-
     parent family for such assistance.''.
       (b) Penalty.--Section 409(a) (42 U.S.C. 609(a)) is amended 
     by adding at the end the following:
       ``(15) Penalty for imposition of stricter eligibility 
     criteria for 2-parent families.--
       ``(A) In general.--If the Secretary determines that a State 
     to which a grant is made under section 403 for a fiscal year 
     has violated section 408(a)(12) during the fiscal year, the 
     Secretary shall reduce the grant payable to the State under 
     section 403(a)(1) for the immediately succeeding fiscal year 
     by an amount equal to 5 percent of the State family 
     assistance grant.
       ``(B) Penalty based on severity of failure.--The Secretary 
     shall impose reductions under subparagraph (A) with respect 
     to a fiscal year based on the degree of noncompliance.''.

[[Page S9723]]

     SEC. 203. TEEN PREGNANCY PREVENTION GRANTS.

       Section 403(a)(2) (42 U.S.C. 603(a)(2)) is amended to read 
     as follows:
       ``(2) Grants to prevent teen pregnancy.--
       ``(A) Submission of plan.--
       ``(i) In general.--Each State that submits a plan that 
     meets the requirements of clause (ii) shall be entitled to 
     receive from the Secretary a teen pregnancy prevention grant 
     in the amount determined under subparagraph (B) for each of 
     fiscal years 2004 through 2008.
       ``(ii) Plan requirements.--A plan meets the requirements of 
     this clause if the plan--

       ``(I) describes the State's numerical goal for reducing 
     teen pregnancy and teen births;
       ``(II) identifies the strategies to be used to achieve such 
     goal; and
       ``(III) describes the efforts the State will make to 
     involve young men, as well as young women, in delaying 
     pregnancy and parenting.

       ``(iii) Set-aside for grants to indian tribes.--Not less 
     than an amount equal to 1.5 percent of the amount 
     appropriated under subparagraph (G) for a fiscal year shall 
     be used for the purpose of awarding grants to Indian tribes 
     under this paragraph in such manner, and subject to such 
     requirements, as the Secretary, in consultation with such 
     tribes, determines appropriate.
       ``(B) Grant amount.--
       ``(i) In general.--The Secretary shall allot to each State 
     with a plan approved under subparagraph (A) an amount equal 
     to--

       ``(I) with respect to fiscal year 2004, the amount that 
     bears the same ratio to the amount of funds appropriated 
     under subparagraph (G) for such fiscal year as the proportion 
     of births in the State to teens under age 20 bears to the 
     number of such births in all States; and
       ``(II) with respect to each of fiscal years 2005 through 
     2008, the amount that bears the same ratio to 50 percent of 
     the amount of funds appropriated under subparagraph (G) for 
     each such fiscal year as the proportion of births in the 
     State to teens under age 20 bears to the number of such 
     births in all States.

       ``(ii) Incentive funds.--In addition to the amount 
     determined for a State under clause (i)(II), in the case of a 
     State that is a high achieving State (as defined in clause 
     (iii)), the Secretary shall allot to such high achieving 
     State with respect to each of fiscal years 2005 through 2008, 
     the amount that bears the same ratio to 50 percent of the 
     amount of funds appropriated under subparagraph (G) for each 
     such fiscal year as the proportion of teens under age 20 in 
     the high achieving State bears to the number of such teens in 
     all such high achieving States.
       ``(iii) Definition of high achieving state.--In this 
     paragraph, the term `high achieving State' means a State that 
     has achieved an annual decline in the teen birth rate for the 
     State as compared to the preceding year (or the most recent 
     year for which data is available) of at least 2.5 percent.
       ``(iv) Determination of teen birth rates.--For purposes of 
     this subparagraph, the teen birth rate for a State shall be 
     determined on the basis of the birth rate per 1,000 women, 
     ages 15 through 19, who reside in the State.
       ``(C) Use of funds.--
       ``(i) In general.--A State shall use funds provided under a 
     grant made under this paragraph to implement teen pregnancy 
     prevention strategies that--

       ``(I) are abstinence-first, as defined in clause (ii)(I);
       ``(II) replicate or substantially incorporate the elements 
     of 1 or more teen pregnancy prevention programs, including 
     certain youth development programs and service learning 
     programs, that have been proven effective (on the basis of 
     rigorous scientific research as defined in clause (ii)(III));
       ``(III) delay or decrease sexual activity, increase 
     contraceptive use among sexually active teens, or reduce 
     teenage pregnancies without increasing risky behaviors; and
       ``(IV) incorporate outreach or media programs.

       ``(ii) Design and implementation flexibility.--States and 
     Indian tribes receiving a grant under this paragraph shall 
     have flexibility to determine how to use funds made available 
     under the grant to design and implement the teen pregnancy 
     prevention strategies described in clause (i).
       ``(iii) Definitions.--In this paragraph:

       ``(I) Abstinence-first.--The term `abstinence-first' means 
     a strategy that strongly emphasizes abstinence as the best 
     and only certain way to avoid pregnancy and sexually 
     transmitted infections and that discusses the scientifically 
     proven effectiveness, benefits, and limitations of 
     contraception and other approaches in a manner that is 
     medically accurate, as defined in subclause (II).
       ``(II) Medically accurate.--The term `medically accurate' 
     means information that is supported by research recognized as 
     accurate and objective by leading medical, psychological, 
     psychiatric, or public health organizations and agencies and, 
     where relevant, is published in a peer-reviewed journal (as 
     defined by the American Medical Association).
       ``(III) Rigorous scientific research.--The term `rigorous 
     scientific research' means research that typically uses 
     randomized control trials and other similar strong 
     experimental designs.

       ``(D) Subgrant or contract recipients.--A State to which a 
     grant is made under this paragraph for a fiscal year may 
     award subgrants or contracts to--
       ``(i) State or local nonprofit coalitions working to 
     prevent teenage pregnancy;
       ``(ii) State, local, or tribal agencies;
       ``(iii) schools;
       ``(iv) entities that provide after school programs;
       ``(v) nonprofit community or faith-based organizations; or
       ``(vi) other organizations designated by the State.
       ``(E) Supplementation of funds.--A State to which a grant 
     is made under this paragraph for a fiscal year shall use 
     funds provided under the grant to supplement and not supplant 
     funds that would otherwise be available to the State for 
     preventing teen pregnancy.
       ``(F) Data reporting.--A State to which a grant is made 
     under this paragraph for a fiscal year shall cooperate with 
     the Secretary to collect information and report on outcomes 
     of programs funded under the grant, as specified by the 
     Secretary.
       ``(G) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there are 
     appropriated for making grants under this paragraph--
       ``(i) for fiscal year 2004, $50,000,000; and
       ``(ii) for each of fiscal years 2005 through 2008, 
     $100,000,000.''.

     SEC. 204. TEEN PREGNANCY PREVENTION RESOURCE CENTER.

       (a) Authority To Establish.--
       (1) In general.--The Secretary of Health and Human Services 
     (in this section referred to as the ``Secretary'') shall make 
     a grant to a nationally recognized, nonpartisan, nonprofit 
     organization that meets the requirements described in 
     paragraph (2) to establish and operate a national teen 
     pregnancy prevention resource center (in this section 
     referred to as the ``Resource Center'') to carry out the 
     purposes and activities described in subsection (b).
       (2) Contractor requirements.--The requirements described in 
     this paragraph are the following:
       (A) The organization has at least 7 years of experience in 
     working with diverse sectors of society to reduce teen 
     pregnancy.
       (B) The organization has a demonstrated ability to work 
     with and provide assistance to a broad range of individuals 
     and entities, including teens, parents, the entertainment and 
     news media, State, tribal, and local organizations, networks 
     of teen pregnancy prevention practitioners, businesses, faith 
     and community leaders, and researchers.
       (C) The organization is research-based and has capabilities 
     in scientific analysis and evaluation.
       (D) The organization has comprehensive knowledge and data 
     about teen pregnancy prevention strategies.
       (E) The organization has experience carrying out activities 
     similar to the activities described in subsection (b)(2).
       (b) Purposes and Activities.--
       (1) Purposes.--The purposes of the Resource Center are to--
       (A) provide information and technical assistance to States, 
     Indian tribes, local communities, and other public or private 
     organizations seeking to reduce rates of teen pregnancy;
       (B) support parents in their essential role in preventing 
     teen pregnancy by equipping parents with information and 
     resources to promote and strengthen communication with their 
     children; and
       (C) assist the entertainment media industry by providing 
     information and helping that industry develop content and 
     messages for teens and adults that can help prevent teen 
     pregnancy.
       (2) Activities.--The Resource Center shall carry out the 
     purposes described in paragraph (1) through the following 
     activities:
       (A) Synthesizing and disseminating research and information 
     regarding effective and promising practices to prevent teen 
     pregnancy.
       (B) Developing and providing information on how to design 
     and implement effective programs to prevent teen pregnancy.
       (C) Helping States, local communities, and other 
     organizations increase their knowledge of existing resources 
     that can be used to advance teen pregnancy prevention 
     efforts, build their capacity to access such resources, and 
     develop partnerships with other programs and funding streams.
       (D) Linking organizations working to reduce teen pregnancy 
     with experts and peer groups, including the creation of 
     technical assistance networks.
       (E) Providing consultation and resources on how to reduce 
     teen pregnancy through a broad array of strategies, including 
     enlisting the help of various sectors of society such as 
     parents, other adults (such as coaches, teachers, and 
     mentors), community or faith-based groups, the entertainment 
     and news media, business, and teens themselves.
       (F) Assisting organizations seeking to reduce teen 
     pregnancy in their efforts to work with all forms of media 
     and to reach a variety of audiences (such as teens, parents, 
     and ethnically diverse groups) to communicate effective 
     messages about preventing teen pregnancy, including messages 
     that focus on abstinence, responsible behavior, family 
     communication, relationships, and values.
       (G) Providing resources for parents and other adults that 
     help to foster strong connections with children, which has 
     been proven effective in reducing sexual activity and teen 
     pregnancy, including online access to research, parent 
     guides, tips, and alerts

[[Page S9724]]

     about upcoming opportunities to use the entertainment media 
     as a discussion starter.
       (H) Working directly with individuals and organizations in 
     the entertainment industry to provide consultation and serve 
     as a source of factual information on issues related to teen 
     pregnancy prevention.
       (c) Media Campaigns.--
       (1) In general.--The organization operating the Resource 
     Center may use a portion of the funds appropriated to carry 
     out this section to develop and implement media campaigns 
     directly or through grants, contracts, or cooperative 
     agreements with other entities. Such campaigns may include 
     the production and distribution of printed materials and 
     messages for print media, television and radio broadcast 
     media, the Internet, or such other media as may be 
     appropriate for reaching large numbers of young people, 
     parents, and community leaders.
       (2) Matching.--To the extent possible, funds used to 
     develop and implement media campaigns under this subsection 
     should be matched with non-Federal resources, including in-
     kind contributions, from public and private entities.
       (d) Collaboration With Other Organizations.--The 
     organization operating the Resource Center shall collaborate 
     with other organizations that have expertise and interest in 
     teen pregnancy prevention and that can help to reach out to 
     diverse audiences.
       (e) Evaluation.--
       (1) Reservation and availability of funds.--Of the amount 
     appropriated under subsection (f) for fiscal year 2004, 
     $5,000,000 shall be reserved for use by the Secretary of 
     Health and Human Services to prepare an interim and final 
     report summarizing and synthesizing outcomes and lessons 
     learned from the activities funded under this section. Funds 
     reserved under the preceding sentence shall remain available 
     for expenditure through fiscal year 2008.
       (2) Required information.--Each report required under 
     paragraph (1) shall include--
       (A) a rigorous scientific evaluation of at least 3 such 
     activities that are selected to represent a diversity of 
     strategies; and
       (B) an assessment of the ability to replicate and expand 
     activities that have proven effective on a smaller scale.
       (f) Authorization of Appropriations.--There are authorized 
     to be appropriated to the Secretary of Health and Human 
     Services to carry out this section, $10,000,000 for each of 
     fiscal years 2004 through 2008.

     SEC. 205. ESTABLISHING NATIONAL GOALS TO PREVENT TEEN 
                   PREGNANCY.

       Section 905 of the Personal Responsibility and Work 
     Opportunity Reconciliation Act of 1996 (42 U.S.C. 710 note) 
     is amended to read as follows:

     ``SEC. 905. ESTABLISHING NATIONAL GOALS TO PREVENT TEEN 
                   PREGNANCY.

       ``(a) In General.--Not later than January 1, 2004, the 
     Secretary of Health and Human Services shall establish a 
     national goal of reducing teen pregnancy by at least 25 
     percent by January 1, 2014.
       ``(b) Report.--Not later than June 30, 2004, and annually 
     thereafter, the Secretary of Health and Human Services shall 
     report to Congress with respect to the progress that has been 
     made in meeting the national goal established under 
     subsection (a).''.

        Subtitle B--Child Support Distribution to Families First

                CHAPTER 1--DISTRIBUTION OF CHILD SUPPORT

     SEC. 211. DISTRIBUTION OF CHILD SUPPORT COLLECTED BY STATES 
                   ON BEHALF OF CHILDREN RECEIVING CERTAIN WELFARE 
                   BENEFITS.

       (a) Modification of Rule Requiring Assignment of Support 
     Rights as a Condition of Receiving TANF.--Section 408(a)(3) 
     (42 U.S.C. 608(a)(3)) is amended to read as follows:
       ``(3) No assistance for families not assigning certain 
     support rights to the state.--A State to which a grant is 
     made under section 403 shall require, as a condition of 
     paying assistance to a family under the State program funded 
     under this part, that a member of the family assign to the 
     State any right the family member may have (on behalf of the 
     family member or of any other person for whom the family 
     member has applied for or is receiving such assistance) to 
     support from any other person, not exceeding the total amount 
     of assistance so paid to the family, which accrues during the 
     period that the family receives assistance under the 
     program.''.
       (b) Increasing Child Support Payments to Families and 
     Simplifying Child Support Distribution Rules.--
       (1) Distribution rules.--
       (A) In general.--Section 457(a) (42 U.S.C. 657(a)) is 
     amended to read as follows:
       ``(a) In General.--Subject to subsections (e) and (f), the 
     amounts collected on behalf of a family as support by a State 
     pursuant to a plan approved under this part shall be 
     distributed as follows:
       ``(1) Families receiving assistance.--In the case of a 
     family receiving assistance from the State, the State shall--
       ``(A) pay to the Federal Government the Federal share of 
     the amount collected, subject to paragraph (3)(A);
       ``(B) retain, or pay to the family, the State share of the 
     amount collected, subject to paragraph (3)(B); and
       ``(C) pay to the family any remaining amount.
       ``(2) Families that formerly received assistance.--In the 
     case of a family that formerly received assistance from the 
     State:
       ``(A) Current support.--To the extent that the amount 
     collected does not exceed the current support amount, the 
     State shall pay the amount to the family.
       ``(B) Arrearages.--Except as otherwise provided in an 
     election made under 434(34), to the extent that the amount 
     collected exceeds the current support amount, the State--
       ``(i) shall first pay to the family the excess amount, to 
     the extent necessary to satisfy support arrearages not 
     assigned pursuant to section 408(a)(3);
       ``(ii) if the amount collected exceeds the amount required 
     to be paid to the family under clause (i), shall--

       ``(I) pay to the Federal Government, the Federal share of 
     the excess amount described in this clause, subject to 
     paragraph (3)(A); and
       ``(II) retain, or pay to the family, the State share of the 
     excess amount described in this clause, subject to paragraph 
     (3)(B); and

       ``(iii) shall pay to the family any remaining amount.
       ``(3) Limitations.--
       ``(A) Federal reimbursements.--The total of the amounts 
     paid by the State to the Federal Government under paragraphs 
     (1) and (2) of this subsection with respect to a family shall 
     not exceed the Federal share of the amount assigned with 
     respect to the family pursuant to section 408(a)(3).
       ``(B) State reimbursements.--The total of the amounts 
     retained by the State under paragraphs (1) and (2) of this 
     subsection with respect to a family shall not exceed the 
     State share of the amount assigned with respect to the family 
     pursuant to section 408(a)(3).
       ``(4) Families that never received assistance.--In the case 
     of any other family, the State shall pay the amount collected 
     to the family.
       ``(5) Families under certain agreements.--Notwithstanding 
     paragraphs (1) through (3), in the case of an amount 
     collected for a family in accordance with a cooperative 
     agreement under section 454(33), the State shall distribute 
     the amount collected pursuant to the terms of the agreement.
       ``(6) State financing options.--To the extent that the 
     State's share of the amount payable to a family pursuant to 
     paragraph (2)(B) of this subsection exceeds the amount that 
     the State estimates (under procedures approved by the 
     Secretary) would have been payable to the family pursuant to 
     former section 457(a)(2)(B) (as in effect for the State 
     immediately before the date this subsection first applies to 
     the State) if such former section had remained in effect, the 
     State may elect to use the grant made to the State under 
     section 403(a) to pay the amount, or to have the payment 
     considered a qualified State expenditure for purposes of 
     section 409(a)(7), but not both.
       ``(7) State option to pass through additional support with 
     federal financial participation.--
       ``(A) In general.--Notwithstanding paragraphs (1), a State 
     shall not be required to pay to the Federal Government the 
     Federal share of an amount collected on behalf of a family 
     that is not a recipient of assistance under the State program 
     funded under part A, to the extent that the State pays the 
     amount to the family.
       ``(B) Recipients of tanf for less than 5 years.--
       ``(i) In general.--Notwithstanding paragraphs (1), a State 
     shall not be required to pay to the Federal Government the 
     Federal share of an amount collected on behalf of a family 
     that is a recipient of assistance under the State program 
     funded under part A and, if the family includes an adult, 
     that has received the assistance for not more than 5 years 
     after the date of enactment of this paragraph, to the extent 
     that--

       ``(I) the State pays the amount to the family; and
       ``(II) subject to clause (ii), the amount is disregarded in 
     determining the amount and type of the assistance provided to 
     the family.

       ``(ii) Limitation.--Of the amount disregarded as described 
     in clause (i)(II), the maximum amount that may be taken into 
     account for purposes of clause (i) shall not exceed $400 per 
     month, except that, in the case of a family that includes 2 
     or more children, the State may elect to increase the maximum 
     amount to not more than $600 per month.
       ``(8) States with demonstration waivers.--Notwithstanding 
     the preceding paragraphs, a State with a waiver under section 
     1115, effective on or before October 1, 1997, the terms of 
     which allow pass-through of child support payments, may pass 
     through payments in accordance with such terms with respect 
     to families subject to the waiver.''.
       (B) State plan to include election as to which rules to 
     apply in distributing child support arrearages collected on 
     behalf of families formerly receiving assistance.--Section 
     454 (42 U.S.C. 654) is amended--
       (i) by striking ``and'' at the end of paragraph (32);
       (ii) by striking the period at the end of paragraph (33) 
     and inserting ``; and''; and
       (iii) by inserting after paragraph (33) the following:
       ``(34) include an election by the State to apply section 
     457(a)(2)(B) of this Act or former section 457(a)(2)(B) of 
     this Act (as in effect for the State immediately before the 
     date this paragraph first applies to the State) to the 
     distribution of the amounts

[[Page S9725]]

     which are the subject of such sections, and for so long as 
     the State elects to so apply such former section, the 
     amendments made by subsection (b)(1)(A) of section 211 of the 
     Building on Welfare Success Act of 2003 shall not apply with 
     respect to the State, notwithstanding subsection (f)(1) of 
     such section 211.''.
       (C) Approval of estimation procedures.--Not later than the 
     date that is 6 months after the date of enactment of this 
     Act, the Secretary of Health and Human Services, in 
     consultation with the States (as defined for purposes of part 
     D of title IV of the Social Security Act), shall establish 
     the procedures to be used to make the estimate described in 
     section 457(a)(6) of such Act.
       (2) Current support amount defined.--Section 457(c) (42 
     U.S.C. 657(c)) is amended by adding at the end the following:
       ``(5) Current support amount.--The term `current support 
     amount' means, with respect to amounts collected as support 
     on behalf of a family, the amount designated as the monthly 
     support obligation of the noncustodial parent in the order 
     requiring the support.''.
       (c) Ban on Recovery of Medicaid Costs for Certain Births.--
     Section 454 (42 U.S.C. 654), as amended by subsection 
     (b)(1)(B), is amended--
       (1) by striking ``and'' at the end of paragraph (33);
       (2) by striking the period at the end of paragraph (34) and 
     inserting ``; and''; and
       (3) by inserting after paragraph (34) the following:
       ``(35) provide that the State shall not use the State 
     program operated under this part to collect any amount owed 
     to the State by reason of costs incurred under the State plan 
     approved under title XIX for the birth of a child for whom 
     support rights have been assigned pursuant to section 
     408(a)(3), 471(a)(17), or 1912.''.
       (d) State Option To Discontinue Pre-1997 Support 
     Assignments.--Section 457(b) (42 U.S.C. 657(b)) is amended to 
     read as follows:
       ``(b) Continuation of Assignments.--
       ``(1) State option to discontinue pre-1997 support 
     assignments.--
       ``(A) In general.--Any rights to support obligations 
     assigned to a State as a condition of receiving assistance 
     from the State under part A and in effect on September 30, 
     1997 (or such earlier date on or after August 22, 1996, as 
     the State may choose), may remain assigned after such date.
       ``(B) Distribution of amounts after assignment 
     discontinuation.--If a State chooses to discontinue the 
     assignment of a support obligation described in subparagraph 
     (A), the State may treat amounts collected pursuant to such 
     assignment as if such amounts had never been assigned and may 
     distribute such amounts to the family in accordance with 
     subsection (a)(4).
       ``(2) State option to discontinue post-1997 assignments.--
       ``(A) In general.--Any rights to support obligations 
     accruing before the date on which a family first receives 
     assistance that are assigned to a State under part A and in 
     effect before the implementation date of this section may 
     remain assigned after such date.
       ``(B) Distribution of amounts after assignment 
     discontinuation.--If a State chooses to discontinue the 
     assignment of a support obligation described in subparagraph 
     (A), the State may treat amounts collected pursuant to such 
     assignment as if such amounts had never been assigned and may 
     distribute such amounts to the family in accordance with 
     subsection (a)(4).''.
       (e) Conforming Amendments.--
       (1) Section 404(a) (42 U.S.C. 604(a)) is amended--
       (A) by striking ``or'' at the end of paragraph (1);
       (B) by striking the period at the end of paragraph (2) and 
     inserting ``; or''; and
       (C) by adding at the end the following:
       ``(3) to fund payment of an amount pursuant to clause (i) 
     or (ii) of section 457(a)(2)(B), but only to the extent that 
     the State properly elects under section 457(a)(6) to use the 
     grant to fund the payment.''.
       (2) Section 409(a)(7)(B)(i) (42 U.S.C. 609(a)(7)(B)(i)) is 
     amended--
       (A) in subclause (I)(aa), by striking ``457(a)(1)(B)'' and 
     inserting ``457(a)(1)''; and
       (B) by adding at the end the following:

       ``(V) Portions of certain child support payments collected 
     on behalf of and distributed to families no longer receiving 
     assistance.--Any amount paid by a State pursuant to clause 
     (i) or (ii) of section 457(a)(2)(B), but only to the extent 
     that the State properly elects under section 457(a)(6) to 
     have the payment considered a qualified State expenditure.''.

       (3) Tax offset authority.--Section 6402(c) of the Internal 
     Revenue Code of 1986 (relating to authority to make credits 
     or refunds) is amended--
       (A) in the first sentence, by striking ``the Social 
     Security Act'' the second place it appears and inserting 
     ``such Act''; and
       (B) by striking the third sentence and inserting the 
     following: ``The Secretary shall apply a reduction under this 
     subsection first to an amount certified by the State as past 
     due support under section 464 before any other reductions 
     allowed by law.''.
       (f) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     take effect on October 1, 2004, and shall apply to payments 
     under parts A and D of title IV of the Social Security Act 
     for calendar quarters beginning on or after such date, and 
     without regard to whether regulations to implement such 
     amendments (in the case of State programs operated under such 
     part D) are promulgated by such date.
       (2) State option to accelerate effective date.--In 
     addition, a State may elect to have the amendments made by 
     this section apply to the State and to amounts collected by 
     the State, on and after such date as the State may select 
     that is after the date of enactment of this Act and before 
     October 1, 2004.

                    CHAPTER 2--EXPANDED ENFORCEMENT

     SEC. 221. DECREASE IN AMOUNT OF CHILD SUPPORT ARREARAGE 
                   TRIGGERING PASSPORT DENIAL.

       Section 452(k) (42 U.S.C. 652(k)) is amended by striking 
     ``$5,000'' and inserting ``$2,500''.

     SEC. 222. USE OF TAX REFUND INTERCEPT PROGRAM TO COLLECT 
                   PAST-DUE CHILD SUPPORT ON BEHALF OF CHILDREN 
                   WHO ARE NOT MINORS.

       Section 464 (42 U.S.C. 664) is amended--
       (1) in subsection (a)(2)(A), by striking ``(as that term is 
     defined for purposes of this paragraph under subsection 
     (c))''; and
       (2) in subsection (c)--
       (A) in paragraph (1)--
       (i) by striking ``(1) Except as provided in paragraph (2), 
     as used in'' and inserting ``In''; and
       (ii) by inserting ``(whether or not a minor)'' after ``a 
     child'' each place it appears; and
       (B) by striking paragraphs (2) and (3).

     SEC. 223. GARNISHMENT OF COMPENSATION PAID TO VETERANS FOR 
                   SERVICE-CONNECTED DISABILITIES IN ORDER TO 
                   ENFORCE CHILD SUPPORT OBLIGATIONS.

       Section 459(h) (42 U.S.C. 659(h)) is amended--
       (1) in paragraph (1)(A)(ii)--
       (A) in subclause (IV), by striking ``or'' after the 
     semicolon;
       (B) in subclause (V), by inserting ``or'' after the 
     semicolon; and
       (C) by adding at the end the following:

       ``(VI) subject to paragraph (3), other than periodic 
     benefits or payments described in subclause (V), by the 
     Secretary of Veterans Affairs as compensation for a service-
     connected disability paid by the Secretary to a former member 
     of the Armed Forces;'';

       (2) in paragraph (1)(B)(iii), by striking ``subparagraph 
     (A)(ii)(V)'' and inserting ``subclauses (V) and (VI) of 
     subparagraph (A)(ii)''; and
       (3) by adding at the end the following:
       ``(3) Limitations with respect to compensation paid to 
     veterans for service-connected disabilities.--
       ``(A) Alimony and child support.--Compensation described in 
     paragraph (1)(A)(ii)(VI) shall not be subject to withholding 
     pursuant to this section--
       ``(i) for payment of alimony; or
       ``(ii) for payment of child support if the individual is 
     fewer than 60 days in arrears in payment of the support.
       ``(B) Limitation.--Not more than 50 percent of any payment 
     of compensation described in subparagraph (A) may be withheld 
     pursuant to this section.''.

     SEC. 224. MANDATORY REVIEW AND ADJUSTMENT OF CHILD SUPPORT 
                   ORDERS FOR FAMILIES RECEIVING TANF.

       (a) In General.--Section 466(a)(10)(A)(i) (42 U.S.C. 
     666(a)(10)(A)(i)) is amended in the matter preceding 
     subclause (I)--
       (1) by striking ``parent, or,'' and inserting ``parent 
     or''; and
       (2) by striking ``upon the request of the State agency 
     under the State plan or of either parent,''.
       (b) Effective Date.--The amendments made by subsection (a) 
     shall take effect on October 1, 2005.

     SEC. 225. IMPROVED INTERSTATE ENFORCEMENT.

       (a) Adoption of Uniform State Laws.--Section 466(f) (42 
     U.S.C. 666(f)) is amended--
       (1) by striking ``January 1, 1998'' and inserting ``October 
     1, 2004''; and
       (2) by striking ``August 22, 1996'' and inserting ``January 
     1, 2002''.
       (b) Full Faith and Credit for Child Support Orders.--
     Section 1738B of title 28, United States Code, is amended--
       (1) by striking subsection (d) and inserting the following:
       ``(d) Continuing Exclusive Jurisdiction.--
       ``(1) In general.--Subject to paragraph (2), a court of a 
     State that has made a child support order consistently with 
     this section has continuing, exclusive jurisdiction to modify 
     its order if the order is the controlling order and--
       ``(A) the State is the child's State or the residence of 
     any individual contestant; or
       ``(B) if the State is not the residence of the child or an 
     individual contestant, the contestants consent in a record or 
     in open court that the court may continue to exercise 
     jurisdiction to modify its order.
       ``(2) Requirement.--A court may not exercise its 
     continuing, exclusive jurisdiction to modify the order if the 
     court of another State, acting in accordance with subsections 
     (e) and (f), has made a modification of the order.'';
       (2) in subsection (e)(2)--
       (A) in subparagraph (A), by striking ``because'' and all 
     that follows through the semicolon and inserting ``pursuant 
     to paragraph (1) or (2) of subsection (d);'' and
       (B) in subparagraph (B), by inserting ``with jurisdiction 
     over at least 1 of the individual contestants or that is 
     located in the child's State'' after ``another State'';
       (3) in subsection (f)--
       (A) in the subsection heading, by striking ``Recognition of 
     Child Support Orders''

[[Page S9726]]

     and inserting ``Determination of Controlling Child Support 
     Order'';
       (B) in the matter preceding paragraph (1), by striking 
     ``shall apply'' and all that follows through the colon and 
     inserting ``having personal jurisdiction over both individual 
     contestants shall apply the following rules and by order 
     shall determine which order controls:''
       (C) in paragraph (1), by striking ``must be'' and inserting 
     ``controls and must be so'';
       (D) in paragraph (2), by striking ``must be recognized'' 
     and inserting ``controls'';
       (E) in paragraph (3), by striking ``must be recognized'' 
     each place it appears and inserting ``controls'';
       (F) in paragraph (4)--
       (i) by striking ``may'' and inserting ``shall''; and
       (ii) by striking ``must be recognized'' and inserting 
     ``controls''; and
       (G) by striking paragraph (5);
       (4) by striking subsection (g) and inserting the following:
       ``(g) Enforcement of Modified Orders.--If a child support 
     order issued by a court of a State is modified by a court of 
     another State which properly assumed jurisdiction, the 
     issuing court--
       ``(1) may enforce its order that was modified only as to 
     arrears and interest accruing before the modification;
       ``(2) may provide appropriate relief for violations of its 
     order which occurred before the effective date of the 
     modification; and
       ``(3) shall recognize the modifying order of the other 
     State for the purpose of enforcement.'';
       (5) in subsection (h)--
       (A) in paragraph (1), by striking ``and (3)'' and inserting 
     ``, (3), and (4)'';
       (B) in paragraph (2), by inserting ``the computation and 
     payment of arrearages, and the accrual of interest on the 
     arrearages,'' after ``obligations of support,''; and
       (C) by adding at the end the following:
       ``(4) Prospective application.--After a court determines 
     which is the controlling order and issues an order 
     consolidating arrears, if any, a court shall prospectively 
     apply the law of the State issuing the controlling order, 
     including that State's law with respect to interest on 
     arrears, current and future support, and consolidated 
     arrears.''; and
       (6) in subsection (i), by inserting ``and subsection (d)(2) 
     does not apply'' after ``issuing State''.

                        CHAPTER 3--MISCELLANEOUS

     SEC. 231. REPORT ON UNDISTRIBUTED CHILD SUPPORT PAYMENTS.

       Not later than 6 months after the date of 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 procedures that the States use generally to 
     locate custodial parents for whom child support has been 
     collected but not yet distributed due to a change in address. 
     The report shall include an estimate of the total amount of 
     such undistributed child support and the average length of 
     time it takes for such child support to be distributed. The 
     Secretary shall include in the report recommendations as to 
     whether additional procedures should be established at the 
     Federal or State level to expedite the payment of 
     undistributed child support.

     SEC. 232. USE OF NEW HIRE INFORMATION TO ASSIST IN 
                   ADMINISTRATION OF UNEMPLOYMENT COMPENSATION 
                   PROGRAMS.

       Section 453(j) (42 U.S.C. 653(j)) is amended by adding at 
     the end the following:
       ``(7) Information comparisons and disclosure to assist in 
     administration of unemployment compensation programs.--
       ``(A) In general.--If a State agency responsible for the 
     administration of an unemployment compensation program under 
     Federal or State law transmits to the Secretary the name and 
     social security account number of an individual, the 
     Secretary shall, if the information in the National Directory 
     of New Hires indicates that the individual may be employed, 
     disclose to the State agency the name, address, and employer 
     identification number of any putative employer of the 
     individual, subject to this paragraph.
       ``(B) Condition on disclosure.--The Secretary shall make a 
     disclosure under subparagraph (A) only to the extent that the 
     Secretary determines that the disclosure would not interfere 
     with the effective operation of the program under this part.
       ``(C) Use of information.--A State agency may use 
     information provided under this paragraph only for purposes 
     of administering a program referred to in subparagraph 
     (A).''.

     SEC. 233. IMMIGRATION PROVISIONS.

       (a) Nonimmigrant Aliens Ineligible To Receive Visas and 
     Excluded From Admission for Nonpayment of Child Support.--
       (1) In general.--Section 212(a)(10) of the Immigration and 
     Nationality Act (8 U.S.C. 1182(a)(10)) is amended by adding 
     at the end the following:
       ``(F) Nonpayment of child support.--
       ``(i) In general.--Any nonimmigrant alien is inadmissible 
     who is legally obligated under a judgment, decree, or order 
     to pay child support (as defined in section 459(i)(2) of the 
     Social Security Act), and whose failure to pay such child 
     support has resulted in an arrearage exceeding $2,500, until 
     child support payments under the judgment, decree, or order 
     are satisfied or the nonimmigrant alien is in compliance with 
     an approved payment agreement.
       ``(ii) Waiver authorized.--The Secretary of Homeland 
     Security may waive the application of clause (i) in the case 
     of an alien, if the Secretary--

       ``(I) has received a request for the waiver from the court 
     or administrative agency having jurisdiction over the 
     judgment, decree, or order obligating the alien to pay child 
     support that is referred to in such clause; or
       ``(II) determines that there are prevailing humanitarian or 
     public interest concerns.''.

       (2) Effective date.--The amendment made by this subsection 
     shall take effect 180 days after the date of enactment of 
     this Act.
       (b) Authorization To Serve Legal Process in Child Support 
     Cases on Certain Arriving Aliens.--
       (1) In general.--Section 235(d) of the Immigration and 
     Nationality Act (8 U.S.C. 1225(d)) is amended by adding at 
     the end the following:
       ``(5) Authority to serve process in child support cases.--
       ``(A) In general.--To the extent consistent with State law, 
     immigration officers are authorized to serve on any alien who 
     is an applicant for admission to the United States legal 
     process with respect to any action to enforce or establish a 
     legal obligation of an individual to pay child support (as 
     defined in section 459(i)(2) of the Social Security Act).
       ``(B) Definition.--For purposes of subparagraph (A), the 
     term `legal process' means any writ, order, summons, or other 
     similar process, which is issued by--
       ``(i) a court or an administrative agency of competent 
     jurisdiction in any State, territory, or possession of the 
     United States; or
       ``(ii) an authorized official pursuant to an order of such 
     a court or agency or pursuant to State or local law.''.
       (2) Effective date.--The amendment made by this subsection 
     shall apply to aliens applying for admission to the United 
     States on or after 180 days after the date of enactment of 
     this Act.
       (c) Authorization To Share Child Support Enforcement 
     Information To Enforce Immigration and Naturalization Law.--
       (1) Secretarial responsibility.--Section 452 (42 U.S.C. 
     652) is amended by adding at the end the following:
       ``(m) If the Secretary receives a certification by a State 
     agency, in accordance with section 454(36), that an 
     individual who is a nonimmigrant alien (as defined in section 
     101(a)(15) of the Immigration and Nationality Act) owes 
     arrearages of child support in an amount exceeding $2,500, 
     the Secretary may, at the request of the State agency, the 
     Secretary of State, or the Secretary of Homeland Security, or 
     on the Secretary's own initiative, provide the certification 
     to the Secretary of State and the Secretary of Homeland 
     Security in order to enable them to carry out their 
     responsibilities under sections 212(a)(10) and 235(d) of such 
     Act.''.
       (2) State agency responsibility.--Section 454 (42 U.S.C. 
     654), as amended by section 211(c), is amended--
       (A) by striking ``and'' at the end of paragraph (34);
       (B) by striking the period at the end of paragraph (35) and 
     inserting ``; and''; and
       (C) by inserting after paragraph (35) the following:
       ``(36) provide that the State agency will have in effect a 
     procedure for certifying to the Secretary, in such format and 
     accompanied by such supporting documentation as the Secretary 
     may require, determinations that nonimmigrant aliens owe 
     arrearages of child support in an amount exceeding $2,500.''.

     SEC. 234. INCREASE IN PAYMENT RATE TO STATES FOR EXPENDITURES 
                   FOR SHORT-TERM TRAINING OF STAFF OF CERTAIN 
                   CHILD WELFARE AGENCIES.

       Section 474(a)(3)(B) of the Social Security Act (42 U.S.C. 
     674(a)(3)(B)) is amended by inserting ``, or State-licensed 
     or State-approved child welfare agencies providing 
     services,'' after ``child care institutions''.

                   Subtitle C--Responsible Fatherhood

     SEC. 241. RESPONSIBLE FATHERHOOD GRANTS.

       Part D of title IV of the Social Security Act (42 U.S.C. 
     651 et seq.) is amended by adding at the end the following:

     ``SEC. 469C. RESPONSIBLE FATHERHOOD GRANTS.

       ``(a) Grants to States To Conduct Demonstration Programs.--
       ``(1) Authority to award grants.--
       ``(A) In general.--The Secretary shall award grants to up 
     to 10 eligible States to conduct demonstration programs to 
     carry out the purposes described in paragraph (2).
       ``(B) Eligible state.--For purposes of this subsection, an 
     eligible State is a State that submits to the Secretary the 
     following:
       ``(i) Application.--An application for a grant under this 
     subsection, at such time, in such manner, and containing such 
     information as the Secretary may require.
       ``(ii) State plan.--A State plan that includes the 
     following:

       ``(I) Project description.--A description of the types of 
     projects the State will fund under the grant, including a 
     good faith estimate of the number and characteristics of 
     clients to be served under such projects and how the State 
     intends to achieve at least 2 of the purposes described in 
     paragraph (2).
       ``(II) Coordination efforts.--A description of how the 
     State will coordinate and cooperate with State and local 
     entities responsible for carrying out other programs that

[[Page S9727]]

     relate to the purposes intended to be achieved under the 
     demonstration program, including as appropriate, entities 
     responsible for carrying out jobs programs and programs 
     serving children and families.
       ``(III) Records, reports, and audits.--An agreement to 
     maintain such records, submit such reports, and cooperate 
     with such reviews and audits as the Secretary finds necessary 
     for purposes of oversight of the demonstration program.

       ``(iii) Certifications.--The following certifications from 
     the chief executive officer of the State:

       ``(I) A certification that the State will use funds 
     provided under the grant to promote at least 2 of the 
     purposes described in paragraph (2).
       ``(II) A certification that the State will return any 
     unused funds to the Secretary in accordance with the 
     reconciliation process under paragraph (4).
       ``(III) A certification that the funds provided under the 
     grant will be used for programs and activities that target 
     low-income participants and that not less than 50 percent of 
     the participants in each program or activity funded under the 
     grant shall be--

       ``(aa) parents of a child who is, or within the past 24 
     months has been, a recipient of assistance or services under 
     a State program funded under this part and is described in 
     section 454(4)(A)(i); or
       ``(bb) parents, including an expectant parent or a married 
     parent, whose income (after adjustment for court-ordered 
     child support paid or received) does not exceed 150 percent 
     of the poverty line.

       ``(IV) A certification that programs or activities funded 
     under the grant will be provided with information regarding 
     the prevention of domestic violence and that the State will 
     consult with representatives of State and local domestic 
     violence centers.
       ``(V) A certification that funds provided to a State under 
     this subsection shall not be used to supplement or supplant 
     other Federal, State, or local funds that are used to support 
     programs or activities that are related to the purposes 
     described in paragraph (2).

       ``(C) Preferences and factors of consideration.--In 
     awarding grants under this subsection, the Secretary shall 
     take into consideration the following:
       ``(i) Diversity of entities used to conduct programs and 
     activities.--The Secretary shall, to the extent practicable, 
     achieve a balance among the eligible States awarded grants 
     under this subsection with respect to the size, urban or 
     rural location, and employment of differing or unique methods 
     of the entities that the States intend to use to conduct the 
     programs and activities funded under the grants.
       ``(ii) Priority for certain states.--The Secretary shall 
     give priority to awarding grants to eligible States that 
     have--

       ``(I) demonstrated progress in achieving at least 1 of the 
     purposes described in paragraph (2) through previous State 
     initiatives; or
       ``(II) demonstrated need with respect to reducing the 
     incidence of out-of-wedlock births or absent fathers in the 
     State.

       ``(2) Purposes.--The purposes described in this paragraph 
     are the following:
       ``(A) Promoting responsible fatherhood through marriage 
     promotion.--To promote marriage or sustain marriage through 
     such activities as counseling, mentoring, disseminating 
     information about the benefits of marriage and 2-parent 
     involvement for children, enhancing relationship skills, 
     education regarding how to control aggressive behavior, 
     disseminating information on the causes of domestic violence 
     and child abuse, marriage preparation programs, premarital 
     counseling, marital inventories, skills-based marriage 
     education, financial planning seminars, including improving a 
     family's ability to effectively manage family business 
     affairs by means such as education, counseling, or mentoring 
     on matters related to family finances, including household 
     management, budgeting, banking, and handling of financial 
     transactions and home maintenance, and divorce education and 
     reduction programs, including mediation and counseling.
       ``(B) Promoting responsible fatherhood through parenting 
     promotion.--To promote responsible parenting through such 
     activities as counseling, mentoring, and mediation, 
     disseminating information about good parenting practices, 
     skills-based parenting education, encouraging child support 
     payments, and other methods.
       ``(C) Promoting responsible fatherhood through fostering 
     economic stability of fathers.--To foster economic stability 
     by helping fathers improve their economic status by providing 
     such activities as work first services, job search, job 
     training, subsidized employment, job retention, job 
     enhancement, and encouraging education, including career-
     advancing education, dissemination of employment materials, 
     coordination with existing employment services such as 
     welfare-to-work programs, referrals to local employment 
     training initiatives, and other methods.
       ``(3) Restriction on use of funds.--No funds provided under 
     this subsection may be used for costs attributable to court 
     proceedings regarding matters of child visitation or custody, 
     or for legislative advocacy.
       ``(4) Reconciliation process.--
       ``(A) 3-year availability of amounts allotted.--Each 
     eligible State that receives a grant under this subsection 
     for a fiscal year shall return to the Secretary any unused 
     portion of the grant for such fiscal year not later than the 
     last day of the second succeeding fiscal year, together with 
     any earnings on such unused portion.
       ``(B) Procedure for redistribution.--The Secretary shall 
     establish an appropriate procedure for redistributing to 
     eligible entities that have expended the entire amount of a 
     grant made under this subsection for a fiscal year any amount 
     that is returned to the Secretary by eligible States under 
     subparagraph (A).
       ``(5) Amount of grants.--
       ``(A) In general.--Subject to subparagraph (B), the amount 
     of each grant awarded under this subsection shall be an 
     amount sufficient to implement the State plan submitted under 
     paragraph (1)(B)(ii).
       ``(B) Minimum amounts.--No eligible State shall--
       ``(i) in the case of the District of Columbia or a State 
     other than the Commonwealth of Puerto Rico, the United States 
     Virgin Islands, Guam, American Samoa, and the Commonwealth of 
     the Northern Mariana Islands, receive a grant for a fiscal 
     year in an amount that is less than $1,000,000; and
       ``(ii) in the case of the Commonwealth of Puerto Rico, the 
     United States Virgin Islands, Guam, American Samoa, and the 
     Commonwealth of the Northern Mariana Islands, receive a grant 
     for a fiscal year in an amount that is less than $500,000.
       ``(6) Definition of state.--In this subsection the term 
     `State' means each of the 50 States, the District of 
     Columbia, the Commonwealth of Puerto Rico, the United States 
     Virgin Islands, Guam, American Samoa, and the Commonwealth of 
     the Northern Mariana Islands.
       ``(7) Authorization of Appropriations.--There is authorized 
     to be appropriated $20,000,000 for each of fiscal years 2004 
     through 2008 for purposes of making grants to States under 
     this subsection.
       ``(b) Grants to Eligible Entities To Conduct Demonstration 
     Programs.--
       ``(1) Authority to award grants.--
       ``(A) In general.--The Secretary shall award grants to 
     eligible entities to conduct demonstration programs to carry 
     out the purposes described in (a)(2).
       ``(B) Eligible entity.--For purposes of this subsection, an 
     eligible entity is a local government, local public agency, 
     community-based or nonprofit organization, or private entity, 
     including any charitable or faith-based organization that 
     submits to the Secretary the following:
       ``(i) Application.--An application for a grant under this 
     subsection, at such time, in such manner, and containing such 
     information as the Secretary may require.
       ``(ii) Project description.--A description of the programs 
     or activities the entity intends to carry out with funds 
     provided under the grant, including a good faith estimate of 
     the number and characteristics of clients to be served under 
     such programs or activities and how the entity intends to 
     achieve at least 2 of the purposes described in subsection 
     (a)(2).
       ``(iii) Coordination efforts.--A description of how the 
     entity will coordinate and cooperate with State and local 
     entities responsible for carrying out other programs that 
     relate to the purposes intended to be achieved under the 
     demonstration program, including as appropriate, entities 
     responsible for carrying out jobs programs and programs 
     serving children and families.
       ``(iv) Records, reports, and audits.--An agreement to 
     maintain such records, submit such reports, and cooperate 
     with such reviews and audits as the Secretary finds necessary 
     for purposes of oversight of the demonstration program.
       ``(v) Certifications.--The following certifications:

       ``(I) A certification that the entity will use funds 
     provided under the grant to promote at least 2 of the 
     purposes described in subsection (a)(2).
       ``(II) A certification that the entity will return any 
     unused funds to the Secretary in accordance with the 
     reconciliation process under paragraph (3).
       ``(III) A certification that the funds provided under the 
     grant will be used for programs and activities that target 
     low-income participants and that not less than 50 percent of 
     the participants in each program or activity funded under the 
     grant shall be--

       ``(aa) parents of a child who is, or within the past 24 
     months has been, a recipient of assistance or services under 
     a State program funded under this part and is described in 
     section 454(4)(A)(i); or
       ``(bb) parents, including an expectant parent or a married 
     parent, whose income (after adjustment for court-ordered 
     child support paid or received) does not exceed 150 percent 
     of the poverty line.

       ``(IV) A certification that the entity will consult with 
     representatives of State and local domestic violence centers.
       ``(V) A certification that funds provided to an entity 
     under this subsection shall not be used to supplement or 
     supplant other Federal, State, or local funds provided to the 
     entity that are used to support programs or activities that 
     are related to the purposes described in subsection (a)(2).

       ``(C) Preferences and factors of consideration.--In 
     awarding grants under this subsection, the Secretary shall, 
     to the extent practicable, achieve a balance among the 
     eligible entities awarded grants under this subsection with 
     respect to the size, urban or rural location, and employment 
     of differing or unique methods of the entities.
       ``(2) Restriction on use of funds.--No funds provided under 
     this subsection may be

[[Page S9728]]

     used for costs attributable to court proceedings regarding 
     matters of child visitation or custody, or for legislative 
     advocacy.
       ``(3) Reconciliation process.--
       ``(A) 3-year availability of amounts allotted.--Each 
     eligible entity that receives a grant under this subsection 
     for a fiscal year shall return to the Secretary any unused 
     portion of the grant for such fiscal year not later than the 
     last day of the second succeeding fiscal year, together with 
     any earnings on such unused portion.
       ``(B) Procedure for redistribution.--The Secretary shall 
     establish an appropriate procedure for redistributing to 
     eligible entities that have expended the entire amount of a 
     grant made under this subsection for a fiscal year any amount 
     that is returned to the Secretary by eligible entities under 
     subparagraph (A).
       ``(4) Authorization of Appropriations.--There is authorized 
     to be appropriated $30,000,000 for each of fiscal years 2004 
     through 2008 for purposes of making grants to eligible 
     entities under this subsection.''.

     SEC. 242. NATIONAL CLEARINGHOUSE FOR RESPONSIBLE FATHERHOOD 
                   PROGRAMS.

       Section 469C of the Social Security Act, as added by 
     section 241, is amended by adding at the end the following:
       ``(c) Media Campaign National Clearinghouse for Responsible 
     Fatherhood.--
       ``(1) Media campaign and national clearinghouse.--
       ``(A) In general.--From any funds appropriated under 
     paragraph (3), the Secretary shall contract with a nationally 
     recognized, nonprofit fatherhood promotion organization 
     described in paragraph (2) to--
       ``(i) develop, promote, and distribute to interested 
     States, local governments, public agencies, and private 
     entities a media campaign that encourages the appropriate 
     involvement of both parents in the life of any child of the 
     parents, with a priority for programs that specifically 
     address the issue of responsible fatherhood; and
       ``(ii) develop a national clearinghouse to assist States 
     and communities in efforts to promote and support marriage 
     and responsible fatherhood by collecting, evaluating, and 
     making available (through the Internet and by other means) to 
     other States information regarding the media campaigns 
     established under subsection (d).
       ``(B) Coordination with domestic violence programs.--The 
     Secretary shall ensure that the nationally recognized 
     nonprofit fatherhood promotion organization with a contract 
     under subparagraph (A) coordinates the media campaign 
     developed under clause (i) of such paragraph and the national 
     clearinghouse developed under clause (ii) of such paragraph 
     with a national, State, or local domestic violence program.
       ``(2) Nationally recognized, nonprofit fatherhood promotion 
     organization described.--The nationally recognized, nonprofit 
     fatherhood promotion organization described in this paragraph 
     is an organization that has at least 4 years of experience 
     in--
       ``(A) designing and disseminating a national public 
     education campaign, as evidenced by the production and 
     successful placement of television, radio, and print public 
     service announcements that promote the importance of 
     responsible fatherhood, a track record of service to Spanish-
     speaking populations and historically underserved or minority 
     populations, the capacity to fulfill requests for information 
     and a proven history of fulfilling such requests, and a 
     mechanism through which the public can request additional 
     information about the campaign; and
       ``(B) providing consultation and training to community-
     based organizations interested in implementing fatherhood 
     outreach, support, or skill development programs with an 
     emphasis on promoting married fatherhood as the ideal.
       ``(3) Authorization of appropriations.--There is authorized 
     to be appropriated $5,000,000 for each of fiscal years 2004 
     through 2008 to carry out this subsection.''.

     SEC. 243. BLOCK GRANTS TO STATES TO ENCOURAGE MEDIA 
                   CAMPAIGNS.

       (a) In General.--Section 469C of the Social Security Act, 
     as added by section 241 and amended by section 242, is 
     amended by adding at the end the following:
       ``(d) Block Grants to States for Media Campaigns Promoting 
     Responsible Fatherhood.--
       ``(1) Definitions.--In this subsection:
       ``(A) Broadcast advertisement.--The term `broadcast 
     advertisement' means a communication intended to be aired by 
     a television or radio broadcast station, including a 
     communication intended to be transmitted through a cable 
     channel.
       ``(B) Child at risk.--The term `child at risk' means each 
     young child whose family income does not exceed the poverty 
     line.
       ``(C) Poverty line.--The term `poverty line' has the 
     meaning given such term in section 673(2) of the Omnibus 
     Budget Reconciliation Act of 1981 (including any revision 
     required by such section) that is applicable to a family of 
     the size involved.
       ``(D) Printed or other advertisement.--The term `printed or 
     other advertisement' includes any communication intended to 
     be distributed through a newspaper, magazine, outdoor 
     advertising facility, mailing, or any other type of general 
     public advertising, but does not include any broadcast 
     advertisement.
       ``(E) State.--The term `State' means each of the 50 States, 
     the District of Columbia, the Commonwealth of Puerto Rico, 
     the United States Virgin Islands, Guam, American Samoa, and 
     the Commonwealth of the Northern Mariana Islands.
       ``(F) Young child.--The term `young child' means an 
     individual under age 5.
       ``(2) State certifications.--Not later than October 1 of 
     each of fiscal year for which a State desires to receive an 
     allotment under this subsection, the chief executive officer 
     of the State shall submit to the Secretary a certification 
     that the State shall--
       ``(A) use such funds to promote the formation and 
     maintenance of married 2-parent families, strengthen fragile 
     families, and promote responsible fatherhood through media 
     campaigns conducted in accordance with the requirements of 
     paragraph (4);
       ``(B) return any unused funds to the Secretary in 
     accordance with the reconciliation process under paragraph 
     (5); and
       ``(C) comply with the reporting requirements under 
     paragraph (6).
       ``(3) Payments to states.--For each of fiscal years 2004 
     through 2008, the Secretary shall pay to each State that 
     submits a certification under paragraph (2), from any funds 
     appropriated under paragraph (8), for the fiscal year an 
     amount equal to the amount of the allotment determined for 
     the fiscal year under paragraph (7).
       ``(4) Establishment of media campaigns.--Each State 
     receiving an allotment under this subsection for a fiscal 
     year shall use the allotment to conduct media campaigns as 
     follows:
       ``(A) Conduct of media campaigns.--
       ``(i) Radio and television media campaigns.--

       ``(I) Production of broadcast advertisements.--At the 
     option of the State, to produce broadcast advertisements that 
     promote the formation and maintenance of married 2-parent 
     families, strengthen fragile families, and promote 
     responsible fatherhood.
       ``(II) Air-time challenge program.--At the option of the 
     State, to establish an air-time challenge program under which 
     the State may spend amounts allotted under this section to 
     purchase time from a broadcast station to air a broadcast 
     advertisement produced under clause (i), but only if the 
     State obtains an amount of time of the same class and during 
     a comparable period to air the advertisement using non-
     Federal contributions.

       ``(ii) Other media campaigns.--At the option of the state, 
     to conduct a media campaign that consists of the production 
     and distribution of printed or other advertisements that 
     promote the formation and maintenance of married 2-parent 
     families, strengthen fragile families, and promote 
     responsible fatherhood.
       ``(B) Administration of media campaigns.--A State may 
     administer media campaigns funded under this subsection 
     directly or through grants, contracts, or cooperative 
     agreements with public agencies, local governments, or 
     private entities, including charitable and faith-based 
     organizations.
       ``(C) Consultation with domestic violence assistance 
     centers.--In developing broadcast and printed advertisements 
     to be used in the media campaigns conducted under 
     subparagraph (A), the State or other entity administering the 
     campaign shall consult with representatives of State and 
     local domestic violence centers.
       ``(D) Non-federal contributions.--In this subsection, the 
     term `non-Federal contributions' includes contributions by 
     the State and by public and private entities. Such 
     contributions may be in cash or in kind. Such term does not 
     include any amounts provided by the Federal Government, or 
     services assisted or subsidized to any significant extent by 
     the Federal Government, or any amount expended by a State 
     before October 1, 2003.
       ``(5) Reconciliation process.--
       ``(A) 3-year availability of amounts allotted.--Each State 
     that receives an allotment under this subsection shall return 
     to the Secretary any unused portion of the amount allotted to 
     a State for a fiscal year not later than the last day of the 
     second succeeding fiscal year together with any earnings on 
     such unused portion.
       ``(B) Procedure for redistribution of unused allotments.--
     The Secretary shall establish an appropriate procedure for 
     redistributing to States that have expended the entire amount 
     allotted under this subsection any amount that is--
       ``(i) returned to the Secretary by States under 
     subparagraph (A); or
       ``(ii) not allotted to a State under this section because 
     the State did not submit a certification under paragraph (2) 
     by October 1 of a fiscal year.
       ``(6) Reporting requirements.--
       ``(A) Monitoring and evaluation.--Each State receiving an 
     allotment under this subsection for a fiscal year shall 
     monitor and evaluate the media campaigns conducted using 
     funds made available under this subsection in such manner as 
     the Secretary, in consultation with the States, determines 
     appropriate.
       ``(B) Annual reports.--Not less frequently than annually, 
     each State receiving an allotment under this subsection for a 
     fiscal year shall submit to the Secretary reports on the 
     media campaigns conducted under this subsection at such time, 
     in such manner, and containing such information as the 
     Secretary may require.
       ``(7) Amount of allotments.--

[[Page S9729]]

       ``(A) In general.--Except as provided in subparagraph (B), 
     of the amount appropriated for the purpose of making 
     allotments under this subsection for a fiscal year, the 
     Secretary shall allot to each State that submits a 
     certification under paragraph (2) for the fiscal year an 
     amount equal to the sum of--
       ``(i) the amount that bears the same ratio to 50 percent of 
     such funds as the number of young children in the State (as 
     determined by the Secretary based on the most recent March 
     supplement to the Current Population Survey of the Bureau of 
     the Census before the beginning of the calendar year in which 
     such fiscal year begins) as bears to the number of such 
     children in all States; and
       ``(ii) the amount that bears the same ratio to 50 percent 
     of such funds as the number of children at risk in the State 
     (as determined by the Secretary based on the most recent 
     March supplement to the Current Population Survey of the 
     Bureau of the Census before the beginning of the calendar 
     year in which such fiscal year begins) bears to the number of 
     such children in all States.
       ``(B) Minimum allotments.--No allotment for a fiscal year 
     under this subsection shall be less than--
       ``(i) in the case of the District of Columbia or a State 
     other than the Commonwealth of Puerto Rico, the United States 
     Virgin Islands, Guam, American Samoa, and the Commonwealth of 
     the Northern Mariana Islands, 1 percent of the amount 
     appropriated for the fiscal year under paragraph (8); and
       ``(ii) in the case of the Commonwealth of Puerto Rico, the 
     United States Virgin Islands, Guam, American Samoa, and the 
     Commonwealth of the Northern Mariana Islands, 0.5 percent of 
     such amount.
       ``(C) Pro rata reductions.--The Secretary shall make such 
     pro rata reductions to the allotments determined under 
     subparagraph (A) as are necessary to comply with the 
     requirements of subparagraph (B).
       ``(8) Authorization of Appropriations.--There is authorized 
     to be appropriated $20,000,000 for each of fiscal years 2004 
     through 2008 for purposes of making allotments to States 
     under this subsection.''.
       (b) Evaluation.--
       (1) In general.--The Secretary of Health and Human Services 
     shall conduct an evaluation of the impact of the media 
     campaigns funded under section 469C(d) of the Social Security 
     Act, as added by subsection (a).
       (2) Report.--Not later than December 31, 2006, the 
     Secretary of Health and Human Services shall report to 
     Congress the results of the evaluation under paragraph (1).
       (3) Funding.--Of the amount appropriated in accordance with 
     section 469C(d)(8) of the Social Security Act (as added by 
     subsection (a)) for fiscal year 2004, $1,000,000 of such 
     amount shall be transferred and made available for purposes 
     of conducting the evaluation required under this subsection, 
     and shall remain available until expended.

                      TITLE III--STATE FLEXIBILITY

     SEC. 301. STATE OPTION TO ASSIST LEGAL IMMIGRANT FAMILIES.

       (a) State Option.--
       (1) In general.--Section 403(c)(2) of the Personal 
     Responsibility and Work Opportunity Reconciliation Act of 
     1996 (8 U.S.C. 1613(c)(2)) is amended by adding at the end 
     the following:
       ``(M) At State option, assistance, benefits, or services 
     under a State program funded under part A of title IV of the 
     Social Security Act (42 U.S.C. 601 et seq.).''.
       (2) Conforming amendment.--Section 408(e) (42 U.S.C. 
     608(e)) is amended to read as follows:
       ``(e) Eligibility of Certain Aliens.--Except as provided in 
     subsection (f), at State option, a State may provide 
     assistance, benefits, or services to a qualified alien (as 
     defined in subsections (b) and (c) of section 431 of the 
     Personal Responsibility and Work Opportunity Reconciliation 
     Act of 1996 (8 U.S.C. 1641)) under the State program funded 
     under this part in the same manner and to the same extent as 
     a citizen of the United States would be provided such 
     assistance, benefits, or services.''.
       (b) Attribution of Sponsor's Income and Resources to 
     Aliens.--
       (1) In general.--Section 408(f) (42 U.S.C. 608(f)) is 
     amended--
       (A) in the heading, by striking ``Non-213A'' and inserting 
     ``Sponsored'';
       (B) by striking ``The following'' and all that follows 
     through the colon and inserting ``The following rules shall 
     apply in determining whether an alien sponsored under section 
     213A of the Immigration and Nationality Act (and, at the 
     option of the State, a non-213A alien) is eligible for cash 
     assistance under the State program funded under this part, or 
     in determining the amount of such assistance to be provided 
     to a sponsored alien:'';
       (C) in paragraph (1)--
       (i) in the matter preceding subparagraph (A), by striking 
     ``non-213A'' and inserting ``sponsored'';
       (ii) in subparagraph (B), by inserting ``(or, a greater 
     amount as determined by the State)'' before the period; and
       (iii) in the heading of subparagraph (C), by striking 
     ``non-213a'' and inserting ``sponsored'';
       (D) by striking paragraph (5) and inserting the following:
       ``(5) Exceptions.--This subsection shall not apply to an 
     alien who is--
       ``(A) a minor child if the sponsor of the alien or any 
     spouse of the sponsor is a parent of the alien child; or
       ``(B) described in subsection (e) or (f) of section 421 of 
     the Personal Responsibility and Work Opportunity 
     Reconciliation Act of 1996 (8 U.S.C. 1631).''; and
       (E) by adding at the end the following:
       ``(7) Inapplicability to family members who are not 
     sponsored aliens.--Income and resources of a sponsor which 
     are deemed under this subsection to be the income and 
     resources of any alien individual in a family shall not be 
     considered in determining the need of other family members 
     except to the extent such income or resources are actually 
     available to such other family members.
       ``(8) Rule of construction.--For purposes of section 421 of 
     the Personal Responsibility and Work Opportunity 
     Reconciliation Act of 1996 (8 U.S.C. 1631), the State program 
     funded under this part is not a Federal means-tested public 
     benefits program.''.
       (2) Conforming amendments.--Section 423(d) of the Personal 
     Responsibility and Work Opportunity Reconciliation Act of 
     1996 (8 U.S.C. 1183a note) is amended by adding at the end 
     the following:
       ``(12) Assistance, benefits, or services under part A of 
     title IV of the Social Security Act except for cash 
     assistance provided to a sponsored alien who is subject to 
     deeming pursuant to section 408(f) of that Act.''.
       (c) State Authority To Provide State and Local Public 
     Benefits for Certain Aliens.--Section 411(d) of the Personal 
     Responsibility and Work Opportunity Reconciliation Act of 
     1996 (8 U.S.C. 1621(d)) is amended--
       (1) in the heading, by inserting ``and Other'' before 
     ``Aliens''; and
       (2) by inserting ``or who otherwise is not a qualified 
     alien (as defined in subsections (b) and (c) of section 
     431)'' after ``United States''.

     SEC. 302. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS UNDER THE 
                   MEDICAID PROGRAM AND TITLE XXI.

       (a) Medicaid Program.--Section 1903(v) (42 U.S.C. 1396b(v)) 
     is amended--
       (1) in paragraph (1), by striking ``paragraph (2)'' and 
     inserting ``paragraphs (2) and (4)''; and
       (2) by adding at the end the following:
       ``(4)(A) A State may elect (in a plan amendment under this 
     title) to provide medical assistance under this title for 
     aliens who are lawfully residing in the United States 
     (including battered aliens described in section 431(c) of the 
     Personal Responsibility and Work Opportunity Reconciliation 
     Act of 1996) and who are otherwise eligible for such 
     assistance, within any of the following eligibility 
     categories:
       ``(i) Pregnant women.--Women during pregnancy (and during 
     the 60-day period beginning on the last day of the 
     pregnancy).
       ``(ii) Children.--Children (as defined under such plan), 
     including optional targeted low-income children described in 
     section 1905(u)(2)(B).
       ``(B)(i) In the case of a State that has elected to provide 
     medical assistance to a category of aliens under subparagraph 
     (A), no debt shall accrue under an affidavit of support 
     against any sponsor of such an alien on the basis of 
     provision of assistance to such category and the cost of such 
     assistance shall not be considered as an unreimbursed cost.
       ``(ii) The provisions of sections 401(a), 402(b), 403, and 
     421 of the Personal Responsibility and Work Opportunity 
     Reconciliation Act of 1996 shall not apply to a State that 
     makes an election under subparagraph (A).''.
       (b) Title XXI.--Section 2107(e)(1) (42 U.S.C. 1397gg(e)(1)) 
     is amended by adding at the end the following:
       ``(E) Section 1903(v)(4) (relating to optional coverage of 
     permanent resident alien children), but only if the State has 
     elected to apply such section to that category of children 
     under title XIX.''.
       (c) Effective Date.--The amendments made by this section 
     take effect on October 1, 2003, and apply to medical 
     assistance and child health assistance furnished on or after 
     such date.

     SEC. 303. 5-YEAR EXTENSION AND SIMPLIFICATION OF THE 
                   TRANSITIONAL MEDICAL ASSISTANCE PROGRAM (TMA).

       (a) Option of Continuous Eligibility for 12 Months; Option 
     of Continuing Coverage for Up To an Additional Year.--
       (1) Option of continuous eligibility for 12 months by 
     making reporting requirements optional.--Section 1925(b) (42 
     U.S.C. 1396r-6(b)) is amended--
       (A) in paragraph (1), by inserting ``, at the option of a 
     State,'' after ``and which'';
       (B) in paragraph (2)(A), by inserting ``Subject to 
     subparagraph (C):'' after ``(A) Notices.--'';
       (C) in paragraph (2)(B), by inserting ``Subject to 
     subparagraph (C):'' after ``(B) Reporting requirements.--'';
       (D) by adding at the end the following new subparagraph:
       ``(C) State option to waive notice and reporting 
     requirements.--A State may waive some or all of the reporting 
     requirements under clauses (i) and (ii) of subparagraph (B). 
     Insofar as it waives such a reporting requirement, the State 
     need not provide for a notice under subparagraph (A) relating 
     to such requirement.''; and
       (E) in paragraph (3)(A)(iii), by inserting ``the State has 
     not waived under paragraph (2)(C) the reporting requirement 
     with respect to such month under paragraph (2)(B) and if'' 
     after ``6-month period if''.

[[Page S9730]]

       (2) State option to extend eligibility for low-income 
     individuals for up to 12 additional months.--Section 1925 (42 
     U.S.C. 1396r-6) is further amended--
       (A) by redesignating subsections (c) through (f) as 
     subsections (d) through (g), respectively; and
       (B) by inserting after subsection (b) the following new 
     subsection:
       ``(c) State Option of Up To 12 Months of Additional 
     Eligibility.--
       ``(1) In general.--Notwithstanding any other provision of 
     this title, each State plan approved under this title may 
     provide, at the option of the State, that the State shall 
     offer to each family which received assistance during the 
     entire 6-month period under subsection (b) and which meets 
     the applicable requirement of paragraph (2), in the last 
     month of the period the option of extending coverage under 
     this subsection for the succeeding period not to exceed 12 
     months.
       ``(2) Income restriction.--The option under paragraph (1) 
     shall not be made available to a family for a succeeding 
     period unless the State determines that the family's average 
     gross monthly earnings (less such costs for such child care 
     as is necessary for the employment of the caretaker relative) 
     as of the end of the 6-month period under subsection (b) does 
     not exceed 185 percent of the official poverty line (as 
     defined by the Office of Management and Budget, and revised 
     annually in accordance with section 673(2) of the Omnibus 
     Budget Reconciliation Act of 1981) applicable to a family of 
     the size involved.
       ``(3) Application of extension rules.--The provisions of 
     paragraphs (2), (3), (4), and (5) of subsection (b) shall 
     apply to the extension provided under this subsection in the 
     same manner as they apply to the extension provided under 
     subsection (b)(1), except that for purposes of this 
     subsection--
       ``(A) any reference to a 6-month period under subsection 
     (b)(1) is deemed a reference to the extension period provided 
     under paragraph (1) and any deadlines for any notices or 
     reporting and the premium payment periods shall be modified 
     to correspond to the appropriate calendar quarters of 
     coverage provided under this subsection; and
       ``(B) any reference to a provision of subsection (a) or (b) 
     is deemed a reference to the corresponding provision of 
     subsection (b) or of this subsection, respectively.''.
       (b) State Option To Waive Receipt of Medicaid for 3 of 
     Previous 6 Months To Qualify for TMA.--Section 1925(a)(1) (42 
     U.S.C. 1396r-6(a)(1)) is amended by adding at the end the 
     following: ``A State may, at its option, also apply the 
     previous sentence in the case of a family that was receiving 
     such aid for fewer than 3 months, or that had applied for and 
     was eligible for such aid for fewer than 3 months, during the 
     6 immediately preceding months described in such sentence.''.
       (c) 5-Year Extension of Sunset for TMA.--
       (1) In general.--Subsection (g) of section 1925 (42 U.S.C. 
     1396r-6), as redesignated under subsection (a)(2)(A), and as 
     amended by section 7 of the Welfare Reform Extension Act of 
     2003 (Public Law 108-040), is amended by striking ``2003'' 
     and inserting ``2008''.
       (2) Conforming amendment.--Section 1902(e)(1)(B) (42 U.S.C. 
     1396a(e)(1)(B)), as so amended, is amended by striking 
     ``2003'' and inserting ``2008''.
       (d) CMS Report on Enrollment and Participation Rates Under 
     TMA.--Section 1925 (42 U.S.C. 1396r-6), as amended by 
     subsections (a)(2)(A) and (c), is amended by inserting after 
     subsection (f) the following:
       ``(g) Additional Provisions.--
       ``(1) Collection and reporting of participation 
     information.--Each State shall--
       ``(A) collect and submit to the Secretary, in a format 
     specified by the Secretary, information on average monthly 
     enrollment and average monthly participation rates for adults 
     and children under this section; and
       ``(B) make such information publicly available.
     Such information shall be submitted under subparagraph (A) at 
     the same time and frequency in which other enrollment 
     information under this title is submitted to the Secretary. 
     Using such information, the Secretary shall submit to 
     Congress annual reports concerning such rates.''.
       (e) Coordination of Work.--Section 1925(g) (42 U.S.C. 
     1396r-6(g)), as added by subsection (d), is amended by adding 
     at the end the following new paragraph:
       ``(2) Coordination with administration for children and 
     families.--The Administrator of the Centers for Medicare & 
     Medicaid Services, in carrying out this section, shall work 
     with the Assistant Secretary for the Administration for 
     Children and Families to develop guidance or other technical 
     assistance for States regarding best practices in 
     guaranteeing access to transitional medical assistance under 
     this section.''.
       (f) Elimination of TMA Requirement for States That Extend 
     Coverage to Children and Parents Through 185 Percent of 
     Poverty.--
       (1) In general.--Section 1925 (42 U.S.C. 1396r-6) is 
     further amended by inserting after subsection (g), as added 
     by subsection (d), the following:
       ``(h) Provisions Optional for States That Extend Coverage 
     to Children and Parents Through 185 Percent of Poverty.--A 
     State may meet (but is not required to meet) the requirements 
     of subsections (a) and (b) if it provides for medical 
     assistance under section 1931 to families (including both 
     children and caretaker relatives) the average gross monthly 
     earning of which (less such costs for such child care as is 
     necessary for the employment of a caretaker relative) is at 
     or below a level that is at least 185 percent of the official 
     poverty line (as defined by the Office of Management and 
     Budget, and revised annually in accordance with section 
     673(2) of the Omnibus Budget Reconciliation Act of 1981) 
     applicable to a family of the size involved.''.
       (2) Conforming amendments.--Section 1925 (42 U.S.C. 1396r-
     6) is further amended, in subsections (a)(1) and (b)(1), by 
     inserting ``, but subject to subsection (h),'' after 
     ``Notwithstanding any other provision of this title,'' each 
     place it appears.
       (g) Requirement of Notice for All Families Losing TANF.--
     Subsection (a)(2) of section 1925 (42 U.S.C. 1396r-6) is 
     amended by adding at the end the following flush sentences:
     ``Each State shall provide, to families whose aid under part 
     A or E of title IV has terminated but whose eligibility for 
     medical assistance under this title continues, written notice 
     of their ongoing eligibility for such medical assistance. If 
     a State makes a determination that any member of a family 
     whose aid under part A or E of title IV is being terminated 
     is also no longer eligible for medical assistance under this 
     title, the notice of such determination shall be supplemented 
     by a 1-page notification form describing the different ways 
     in which individuals and families may qualify for such 
     medical assistance and explaining that individuals and 
     families do not have to be receiving aid under part A or E of 
     title IV in order to qualify for such medical assistance. 
     Such notice shall further be supplemented by information on 
     how to apply for child health assistance under the State 
     children's health insurance program under title XXI and how 
     to apply for medical assistance under this title.''.
       (h) Extending Use of Outstationed Workers To Accept 
     Applications for Transitional Medical Assistance.--Section 
     1902(a)(55) (42 U.S.C. 1396a(a)(55)) is amended by inserting 
     ``and under section 1931'' after ``(a)(10)(A)(ii)(IX)''.
       (i) Effective Dates.--
       (1) In general.--Except as provided in this subsection, the 
     amendments made by this section shall apply to calendar 
     quarters beginning on or after October 1, 2003.
       (2) Notice.--The amendment made by subsection (g) shall 
     take effect 6 months after the date of enactment of this Act.
       (3) Delay permitted for state plan amendment.--In the case 
     of a State plan for medical assistance under title XIX of the 
     Social Security Act which the Secretary of Health and Human 
     Services determines requires State legislation (other than 
     legislation appropriating funds) in order for the plan to 
     meet the additional requirements imposed by the amendments 
     made by this section, the State plan shall not be regarded as 
     failing to comply with the requirements of such title solely 
     on the basis of its failure to meet these additional 
     requirements before the first day of the first calendar 
     quarter beginning after the close of the first regular 
     session of the State legislature that begins after the date 
     of enactment of this Act. For purposes of the previous 
     sentence, in the case of a State that has a 2-year 
     legislative session, each year of such session shall be 
     deemed to be a separate regular session of the State 
     legislature.

     SEC. 304. DEFINITION OF ASSISTANCE.

       Section 419 (42 U.S.C. 619) is amended by adding at the end 
     the following:
       ``(6) Assistance.--
       ``(A) In general.--The term `assistance' means cash 
     benefits and does not include child care or other support 
     services.
       ``(B) Exception.--The term `assistance' does not include a 
     payment to or for an individual or family on a short-term, 
     nonrecurring basis (as defined by the State in accordance 
     with regulations prescribed by the Secretary) or any other 
     benefit or service excluded from the definition of assistance 
     under section 260.31 of title 45 of the Code of Federal 
     Regulations (as in effect on June 1, 2002).''.

     SEC. 305. CLARIFICATION OF AUTHORITY OF STATES TO USE TANF 
                   FUNDS CARRIED OVER FROM PRIOR YEARS TO PROVIDE 
                   TANF BENEFITS AND SERVICES.

       Section 404(e) (42 U.S.C. 604(e)) is amended to read as 
     follows:
       ``(e) Authority To Carry Over Certain Amounts for Benefits 
     or Services or for Future Contingencies.--A State or tribe 
     may use a grant made to the State or tribe under this part 
     for any fiscal year to provide, without fiscal year 
     limitation, any benefit or service that may be provided under 
     the State or tribal program funded under this part.''.

     SEC. 306. AUTHORITY TO USE TANF FUNDS FOR HOUSING BENEFITS.

       (a) In General.--Section 404 (42 U.S.C. 604) is amended by 
     inserting at the end the following:
       ``(l) Use of Funds for Supplemental Housing Benefits.--
       ``(1) In general.--The provision by a State of supplemental 
     housing benefits to or on behalf of an individual eligible 
     for assistance under the State program funded under this 
     part, using funds from a grant made under section 403(a) of 
     this title, shall not be considered to be the provision of 
     assistance to the individual under the State program funded 
     under this part for any purpose except in determining the 
     allowability of the expenditure under section 401(a)(1).
       ``(2) Permitted use of funds.--A State may not use any part 
     of the funds from a

[[Page S9731]]

     grant made under section 403 to supplant rather than 
     supplement State expenditures on housing-related programs.
       ``(3) Definition of supplemental housing benefits.--In this 
     subsection, the term `supplemental housing benefits' means 
     payments made to or on behalf of an individual to reduce or 
     reimburse the costs incurred by the individual for housing 
     accommodations, and the receipt of which does not reduce the 
     amount of assistance, benefits, or services an individual 
     would otherwise receive under the State program funded under 
     this part or under a program funded with qualified State 
     expenditures (as defined in section 409(a)(7)(B)(i)).''.
       (b) State Plan.--Section 402(a)(1)(B) (42 U.S.C. 
     602(a)(1)(B)) is amended by adding at the end the following:
       ``(v) The document shall describe--

       ``(I) the primary problems that families receiving 
     assistance and families who have recently stopped receiving 
     assistance under the State program funded under this part 
     experience in securing and retaining adequate, affordable 
     housing and the estimated extent of each such problem, 
     including the price of such housing in various areas of the 
     State that include a large proportion of recipients of 
     assistance under the State program;
       ``(II) the steps that have been and will be taken by the 
     State and other public or private entities that administer 
     housing programs in the State to address the problems 
     described in subclause (I);
       ``(III) the methods the State has adopted to identify 
     barriers to work posed by the living arrangement, housing 
     cost, and housing location of families eligible for the State 
     program funded under this part; and
       ``(IV) the services and benefits that have been or will be 
     provided by the State or other public or private entities to 
     help families overcome the barriers so identified.''.

                 TITLE IV--RESOURCES AND ACCOUNTABILITY

     SEC. 401. REAUTHORIZATION OF STATE FAMILY ASSISTANCE GRANTS.

       (a) In General.--Section 403(a)(1) (42 U.S.C. 603(a)(1)), 
     as amended by section 3(a) of the Welfare Reform Extension 
     Act of 2003 (Public Law 108-040), is amended--
       (1) in subparagraph (A), by striking ``1996'' and all that 
     follows through ``2003'' and inserting ``2004 through 2008''; 
     and
       (2) in subparagraph (C), by striking ``for fiscal year 
     2003'' and inserting ``for each of fiscal years 2004 through 
     2008''.
       (b) Direct Funding and Administration By Indian Tribes.--
       (1) Tribal family assistance grant.--Section 412(a)(1)(A) 
     (42 U.S.C. 612(a)(1)(A)), as amended by section 3(h) of the 
     Welfare Reform Extension Act of 2003 (Public Law 108-040), is 
     amended by striking ``1997, 1998, 1999, 2000, 2001, 2002, and 
     2003'' and inserting ``2004 through 2008''.
       (2) Grants for indian tribes that received jobs funds.--
     Section 412(a)(2)(A) (42 U.S.C. 612(a)(2)(A)), as so amended, 
     is amended by striking ``1997, 1998, 1999, 2000, 2001, 2002, 
     and 2003'' and inserting ``2004 through 2008''.
       (c) Matching Grants for the Territories.--Section 
     1108(b)(2) (42 U.S.C. 1308(b)(2)), as so amended, is amended 
     by striking ``1997 through 2003'' and inserting ``2004 
     through 2008''.
       (d) Maintenance of Effort Penalty.--Section 409(a)(7) (42 
     U.S.C. 609(a)(7)), as amended by section 3(g) of the Welfare 
     Reform Extension Act of 2003 (Public Law 108-040) is 
     amended--
       (1) in subparagraph (A) by striking ``fiscal year 1998, 
     1999, 2000, 2001, 2002, 2003, or 2004'' and inserting 
     ``fiscal year 2004, 2005, 2006, 2007, 2008, or 2009''; and
       (2) in subparagraph (B)(ii), by striking ``1997 through 
     2003'' and inserting ``2004 through 2008''.
       (e) Federal Loans for State Welfare Programs.--Section 
     406(d) (42 U.S.C. 606(d), as amended by section 3(f) of the 
     Welfare Reform Extension Act of 2003 (Public Law 108-040) is 
     amended by striking ``1997 through 2003'' and inserting 
     ``2004 through 2008''.

     SEC. 402. REAUTHORIZATION OF SUPPLEMENTAL GRANTS FOR 
                   POPULATION INCREASES.

       Section 403(a)(3)(H) (42 U.S.C. 603(a)(3)(H)), as amended 
     by section 3(d) of the Welfare Reform Extension Act of 2003 
     (Public Law 108-040), is amended--
       (1) in clause (i), by striking ``2002 and 2003'' is 
     amended--
       (1) in the subparagraph heading, by striking ``of grants 
     for fiscal year 2002'';
       (2) in clause (i), by striking ``2002 and 2003'' and 
     inserting ``2004 through 2008'';
       (3) in clause (ii), by striking ``2003'' and inserting 
     ``2008''; and
       (4) in clause (iii), by striking ``2002 and 2003'' and 
     inserting ``2004 through 2008''.

     SEC. 403. CONTINGENCY FUND.

       (a) Contingency Funding Available to Needy States.--Section 
     403(b) (42 U.S.C. 603(b)) is amended--
       (1) by striking paragraphs (1) through (3) and inserting 
     the following:
       ``(1) Contingency fund grants.--
       ``(A) Payments.--Subject to subparagraph (C), each State 
     shall receive a contingency fund grant for each eligible 
     month in which the State is a needy State under paragraph 
     (3).
       ``(B) Monthly contingency fund grant amount.--For each 
     eligible month in which a State is a needy State, the State 
     shall receive a contingency fund grant equal to the higher of 
     $0 and the applicable percentage (as defined in subparagraph 
     (D)(i)) of the product of--
       ``(i) the estimated cost of an additional recipient family 
     (as defined in subparagraph (D)(ii)); and
       ``(ii) the increase in the number of families receiving 
     assistance under the State program funded under this part or 
     a program funded with qualified State expenditures (as 
     defined in subparagraph (D)(iv)).
       ``(C) Limitation.--The total amount paid to a single State 
     under subparagraph (A) during a fiscal year shall not exceed 
     the amount equal to 15 percent of the State family assistance 
     grant (as defined under subparagraph (B) of subsection (a)(1) 
     and increased under subparagraph (E) of that subsection).
       ``(D) Definitions.--In this paragraph:
       ``(i) Applicable percentage.--The term `applicable 
     percentage' means the higher of--

       ``(I) 75 percent; and
       ``(II) the sum of the Federal medical assistance percentage 
     for the State (as defined in section 1905(b)) plus 8 
     percentage points.

       ``(ii) Estimated cost of an additional recipient family.--
     The term `estimated cost of an additional recipient family' 
     means the amount equal to 120 percent of the basic assistance 
     cost (as defined under clause (iii)) for families receiving 
     assistance under the State program funded under this part or 
     under a program funded with qualified State expenditures (as 
     defined in section 409(a)(7)(B)(i)).
       ``(iii) Basic assistance cost.--

       ``(I) In general.--The term `basic assistance cost' means 
     the amount equal to the maximum cash assistance grant for a 
     family consisting of 3 individuals under the State program 
     funded under this part.
       ``(II) Rule for states with more than 1 maximum level.--In 
     the case of a State that has more than 1 maximum cash 
     assistance grant level for families consisting of 3 
     individuals, the basic assistance cost shall be the amount 
     equal to the maximum cash assistance grant level applicable 
     to the largest number of families consisting of 3 individuals 
     receiving assistance under the State program funded under 
     this part or a State program funded with qualified State 
     expenditures (as defined in section 409(a)(7)(B)(i)).

       ``(iv) Increase in the number of families receiving 
     assistance under the state program funded under this part or 
     a program funded with qualified state expenditures.--The term 
     `increase in the number of families receiving assistance 
     under the State program funded under this part or a program 
     funded with qualified State expenditures' means the increase 
     in--

       ``(I) the number of families receiving assistance under the 
     State program funded under this part and under a program 
     funded with qualified State expenditures (as defined in 
     section 409(a)(7)(B)(i)) in the most recent month for which 
     data from the State are available; as compared to
       ``(II) the lower of the average monthly number of families 
     receiving such assistance in either of the 2 completed fiscal 
     years immediately preceding the fiscal year in which the 
     State qualifies as a needy State.

       ``(E) Appropriation.--Out of any money in the Treasury of 
     the United States not otherwise appropriated, there are 
     appropriated for the period of fiscal years 2004 through 
     2008, such sums as are necessary for making contingency fund 
     grants under this subsection in a total amount not to exceed 
     $2,000,000,000.'';
       (2) by redesignating paragraph (4) as paragraph (2); and
       (3) in paragraph (2), as so redesignated--
       (A) by striking ``(3)(A)'' and inserting ``(1)''; and
       (B) by striking ``2-month'' and inserting ``3-month''.
       (b) Modification of Definition of Needy State.--Section 
     403(b) (42 U.S.C. 603(b)) is further amended--
       (1) by striking paragraphs (5) through (7);
       (2) by redesignating paragraph (8) as paragraph (5); and
       (3) by inserting after paragraph (2) (as redesignated by 
     subsection (a)(2)) the following:
       ``(3) Initial determination of whether a state qualifies as 
     a needy state.--
       ``(A) In general.--For purposes of paragraph (1), a State 
     will be initially determined to be a needy State for a month 
     if the State satisfies at least 2 of the following:
       ``(i) The--

       ``(I) average rate of total unemployment in the State for 
     the period consisting of the most recent 3 months for which 
     data are available has increased by the lesser of 1.5 
     percentage points or by 50 percent over the corresponding 3-
     month period in either of the 2 most recent preceding fiscal 
     years; or
       ``(II) average insured unemployment rate for the most 
     recent 3 months for which data are available has increased by 
     1 percentage point over the corresponding 3-month period in 
     either of the 2 most recent preceding fiscal years.

       ``(ii) As determined by the Secretary of Agriculture, the 
     monthly average number of households (as of the last day of 
     each month) that participated in the food stamp program in 
     the State in the then most recently concluded 3-month period 
     for which data are available exceeds by at least 10 percent 
     the monthly average number of households (as of the last day 
     of each month) in the State that participated in the food 
     stamp program in the corresponding 3-month period in either 
     of the 2 most recent preceding fiscal years, provided that 
     the Secretary makes a determination that the State's increase 
     in the

[[Page S9732]]

     number of such households was due, in large measure, to 
     economic conditions rather than an expansion of program 
     eligibility requirements.
       ``(iii) As determined by the Secretary, the monthly average 
     number of families that received assistance under the State 
     program funded under this part or under a program funded with 
     qualified State expenditures (as defined in section 
     409(a)(7)(B)(i)) in the most recently concluded 3-month 
     period for which data are available from the State increased 
     by at least 10 percent over the number of such families that 
     received such benefits in the corresponding 3-month period in 
     either of the 2 most recent preceding fiscal years, provided 
     that the Secretary makes a determination that the State's 
     increased caseload was due, in large measure, to economic 
     conditions rather than an expansion of program eligibility 
     requirements.
       ``(B) Duration.--
       ``(i) In general.--A State that qualifies as a needy 
     State--

       ``(I) under subparagraph (A)(i), shall be considered a 
     needy State until the factor which was used to meet the 
     definition of needy State under that subparagraph for the 
     most recently concluded 3-month period for which data are 
     available, falls below the level attained for such factor in 
     the 3-month period in which the State first qualified as a 
     needy State under that subparagraph;
       ``(II) under subparagraph (A)(ii), shall be considered a 
     needy State until the average monthly number of households 
     participating in the food stamp program for the most recently 
     concluded 3-month period for which data are available 
     nationally falls below the food stamp base period level; and
       ``(III) under subparagraph (A)(iii), shall be considered a 
     needy State until the number of families receiving assistance 
     under the State program funded under this part or under a 
     program funded with qualified State expenditures (as defined 
     in section 409(a)(7)(B)(i)) for the most recently concluded 
     3-month period for which data are available falls below the 
     TANF base period level.

       ``(ii) Seasonal variations.--Notwithstanding subclauses 
     (II) and (III) of clause (i), a State shall be considered a 
     needy State--

       ``(I) under subparagraph (A)(ii), if with respect to the 
     State, the monthly average number of households participating 
     in the food stamp program for the most recent 3-month period 
     for which data are available nationally falls below the food 
     stamp base period level and the Secretary determines that 
     this is due to expected seasonal variations in food stamp 
     receipt in the State; and
       ``(II) under subparagraph (A)(iii), if, with respect to a 
     State, the monthly average number of families receiving 
     assistance under the State program funded under this part or 
     under a program funded with qualified State expenditures (as 
     defined in section 409(a)(7)(B)(i)) for the most recently 
     concluded 3-month period for which data are available 
     nationally falls below the TANF base period level and the 
     Secretary determines that this is due to expected seasonal 
     variations in assistance receipt in the State.

       ``(iii) Food stamp base period level.--In this 
     subparagraph, the term `food stamp base period level' means 
     the monthly average number of households participating in the 
     food stamp program that corresponds to the most recent 3-
     month period for which data are available at the time when 
     the State first was determined to be a needy State under this 
     paragraph.
       ``(iv) TANF base period level.--In this subparagraph, the 
     term `TANF base period level' means the monthly average 
     number of families receiving assistance under the State 
     program funded under this part or under a program funded with 
     qualified State expenditures (as defined in section 
     409(a)(7)(B)(i)) that corresponds to the most recent 3 months 
     for which data are available at the time when the State first 
     was determined to be a needy State under this paragraph.
       ``(4) Exception.--
       ``(A) In general.--Notwithstanding paragraph (3), a State 
     that has unobligated TANF reserves from prior fiscal years 
     that equal more than 25 percent of the total amount of grants 
     received by the State under subsection (a) (other than 
     welfare-to-work grants made under paragraph (5) of that 
     subsection prior to fiscal year 1999) but not yet obligated 
     as of the end of the preceding fiscal year shall not be a 
     needy State under this subsection.
       ``(B) Definition of unobligated tanf reserves.--In 
     subparagraph (A), the term `unobligated TANF reserves' means 
     the lessor of--
       ``(i) the total amount of grants made to the State 
     (regardless of the fiscal year in which such funds were 
     awarded) under subsection (a) (other than welfare-to-work 
     grants made under paragraph (5) of that subsection prior to 
     fiscal year 1999) but not yet obligated as of the end of the 
     preceding fiscal year; and
       ``(ii) the total amount of grants made to the State under 
     subsection (a) (other than welfare-to-work grants made under 
     paragraph (5) of that subsection prior to fiscal year 1999) 
     but not yet obligated as of the end of the preceding fiscal 
     year, plus the difference between--

       ``(I) the pro rata share of the fiscal year grants to be 
     made under subsection (a) to the State (other than such 
     welfare-to-work grants); and
       ``(II) current year obligations of the total amount of 
     grants made to all States under subsection (a) (regardless of 
     the fiscal year in which such funds were awarded) (other than 
     such welfare-to-work grants) through the end of the most 
     recent calendar quarter.''.

       (c) Clarification of Reporting Requirements.--Paragraph (5) 
     of section 403(b) (42 U.S.C. 603(b)), as redesignated by 
     subsection (b)(2), is amended by striking ``on the status of 
     the Fund'' and inserting ``on the States that qualified for 
     contingency funds and the amount of funding awarded under 
     this subsection''.

     SEC. 404. CHILD CARE.

       Section 418(a) (42 U.S.C. 618(a)), as amended by section 4 
     of the Welfare Reform Extension Act of 2003, is amended--
       (1) in paragraph (1), in the matter preceding subparagraph 
     (A), by inserting ``and remaining after the reservation 
     described in paragraph (4),'' after ``paragraph (3)'';
       (2) in paragraph (3)--
       (A) by striking ``and'' at the end of subparagraph (E);
       (B) in subparagraph (F), by striking ``2002 and 2003'' and 
     inserting ``2002 through 2006;''; and
       (C) by adding at the end the following:
       ``(G) $3,217,000,000 for fiscal year 2007;
       ``(H) $3,717,000,000 and 2008.'';
       (3) by redesignating paragraph (5) as paragraph (7); and
       (4) by inserting after paragraph (4) the following:
       ``(5) Additional general entitlement grants.--
       ``(A) Appropriation.--
       ``(i) In general.--For additional grants under paragraph 
     (1), there is appropriated--

       ``(I) $750,000,000 for each of fiscal years 2004 and 2005; 
     and
       ``(II) $1,000,000,000 for each of fiscal years 2006 through 
     2008.

       ``(ii) Amounts in addition to other amounts appropriated; 
     availability.--Amounts appropriated under this subparagraph 
     for a fiscal year shall be in addition to amounts 
     appropriated under paragraph (3) for such fiscal year and 
     shall remain available without fiscal year limitation.
       ``(B) Additional grant.--In addition to the grant paid to a 
     State under paragraph (1) for each of fiscal years 2004 
     through 2008, the Secretary, after reserving the amount 
     described in paragraph (4) and subject to the requirement 
     described in paragraph (6), shall pay each State an amount 
     equal to the same proportion of such amount as the proportion 
     of the State's grant under paragraph (1) to the total amount 
     appropriated for State grants under paragraph (1) for such 
     fiscal year.
       ``(6) Requirement for grant increase.--Notwithstanding 
     paragraphs (1), (2), or (5), the aggregate amount paid to a 
     State under this section for each of fiscal years 2004 
     through 2008 may not exceed the aggregate amount paid to the 
     State under this section for fiscal year 2003 unless the 
     State ensures that the level of State expenditures for child 
     care for such fiscal year is not less than the sum of the 
     level of State expenditures for child care that were matched 
     under a grant made to the State under paragraph (2) and that 
     the State expended to meet its maintenance of effort 
     obligation under paragraph (2) for fiscal year 2003.''.

     SEC. 405. RESTORATION OF FUNDING FOR THE SOCIAL SERVICES 
                   BLOCK GRANT.

       (a) Restoration of Funds for the Social Services Block 
     Grant.--Section 2003(c) (42 U.S.C. 1379b(c)) is amended--
       (1) in paragraph (10), by striking ``and'';
       (2) in paragraph (11), by striking ``and each fiscal year 
     thereafter.'' and inserting ``; and''; and
       (3) by adding at the end the following:
       ``(12) $1,750,000,000 for fiscal year 2004;
       ``(13) $1,800,000,000 for fiscal year 2005;
       ``(14) $1,900,000,000 for fiscal year 2006;
       ``(15) $2,100,000,000 for fiscal year 2007; and
       ``(16) $2,800,000,000 for fiscal year 2008 and each fiscal 
     year thereafter.''.
       (b) Restoration of Authority To Transfer up to 10 Percent 
     of TANF Funds.--Section 404(d)(2) (42 U.S.C. 604(d)(2)) is 
     amended to read as follows:
       ``(2) Limitation on amount transferable to title xx 
     programs.--A State may use not more than 10 percent of the 
     amount of any grant made to the State under section 403(a) 
     for a fiscal year to carry out State programs pursuant to 
     title XX.''.

     SEC. 406. COMPETITIVE GRANTS FOR PUBLIC-PRIVATE PARTNERSHIPS 
                   FOR EDUCATIONAL OPPORTUNITIES FOR CAREER 
                   ADVANCEMENT.

       (a) Authority To Award Grants.--
       (1) In general.--The Secretary of Health and Human Services 
     and the Secretary of Labor (in this section referred to as 
     the ``Secretaries'') jointly shall award grants in accordance 
     with the requirements of this section for each fiscal year 
     for which an amount is appropriated to carry out this section 
     for projects proposed by eligible applicants to encourage the 
     formation of public-private partnerships to provide 
     educational opportunities for individuals who receive 
     assistance under the temporary assistance to needy families 
     program funded under part A of title IV of the Social 
     Security Act (42 U.S.C. 601 et seq.) and for individuals who 
     have ceased to receive assistance under that program.
       (2) Criteria.--The Secretaries shall award grants under 
     this section based on the following:
       (A) The potential effectiveness of the proposed project in 
     carrying out the activities described in subsection (e).

[[Page S9733]]

       (B) Evidence of the ability of the eligible applicant to 
     leverage private, State, and local resources to carry out 
     such activities.
       (C) Evidence of the ability of the eligible applicant to 
     coordinate with other organizations at the State and local 
     level in carrying out such activities.
       (b) Definition of Eligible Applicant.--In this section, the 
     term ``eligible applicant'' means--
       (1) a public educational institution;
       (2) an employer; or
       (3) a local or regional consortium that includes employers 
     or employer associations, education and training providers, 
     local chambers of commerce, or providers of social services.
       (c) Application.--Each eligible applicant desiring a grant 
     under this section shall submit an application to the 
     Secretaries at such time, in such manner, and that includes--
       (1) evidence, including letters of support, demonstrating 
     that the applicant will work with the State in carrying out 
     the activities described in subsection (e); and
       (2) such other information as the Secretaries may 
     reasonably require.
       (d) Determination of Amount of Grants; Availability of 
     Funds.--
       (1) In general.--In determining the appropriate amount of a 
     grant to be awarded under this section, the Secretaries shall 
     provide an eligible applicant with an approved application an 
     amount sufficient to ensure that the project has a reasonable 
     opportunity to be successful, taking into account--
       (A) the number and characteristics of the individuals to be 
     served by the project;
       (B) the job opportunities and job growth in the area to be 
     served by the project;
       (C) the poverty rate for such area; and
       (D) such other factors as the Secretaries deem appropriate.
       (2) Maximum amount.--No eligible applicant shall receive a 
     grant of more than $5,000,000 per year.
       (3) Availability of funds.--Funds provided under a grant 
     awarded under this section for a fiscal year shall remain 
     available for use by the eligible applicant through the end 
     of the succeeding fiscal year.
       (e) Use of Funds.--An eligible applicant awarded a grant 
     under this section shall enter into an agreement with the 
     State or local agency responsible for administering the 
     temporary assistance to needy families program in the area 
     where the eligible applicant is located to provide 
     individuals described in subsection (a) with--
       (1) educational credits or opportunities based upon the 
     length of the individual's employment;
       (2) educational credits or opportunities based upon the 
     individual's commitment to becoming employed; or
       (3) education and training opportunities for career 
     advancement.
       (f) Reports.--
       (1) Project reports.--Each eligible applicant awarded a 
     grant under this section shall submit to the Secretaries such 
     information and data regarding the recipients participating 
     in the project funded under such grant and outcomes for such 
     recipients as the Secretaries may require.
       (2) Report to congress.--The Secretaries shall submit 
     annual reports to Congress on the information and data 
     submitted under paragraph (1).
       (g) Authorization of Appropriations.--There are authorized 
     to be appropriated to carry out this section, $25,000,000 for 
     each of fiscal years 2004 through 2008.

     SEC. 407. GRANTS TO IMPROVE ACCESS TO TRANSPORTATION.

       (a) In General.--Section 403(a) (42 U.S.C. 603(a)), as 
     amended by section 201, is amended by adding at the end the 
     following:
       ``(7) Grant to improve access to transportation.--
       ``(A) Purposes.--The purposes of this paragraph are to--
       ``(i) assist low-income families with children obtain 
     dependable, affordable automobiles to improve their 
     employment opportunities and access to training; and
       ``(ii) provide incentives to States, Indian tribes, local 
     governments, and nonprofit entities to develop and administer 
     programs that provide assistance with automobile ownership 
     for low-income families.
       ``(B) Definitions.--In this paragraph:
       ``(i) Locality.--The term `locality' means a municipality 
     that does not administer a State program funded under this 
     part.
       ``(ii) Low-income family with children.--The term `low-
     income family with children' means a household that is 
     eligible for benefits or services funded under the State 
     program funded under this part or under a program funded with 
     qualified State expenditures (as defined in section 
     409(a)(7)(B)(i)).
       ``(iii) Nonprofit entity.--The term `nonprofit entity' 
     means a school, local agency, organization, or institution 
     owned and operated by 1 or more nonprofit corporations or 
     associations, no part of the net earnings of which inures, or 
     may lawfully inure, to the benefit of any private shareholder 
     or individual.
       ``(C) Authority to award grants.--The Secretary may award 
     grants to States, Indian tribes, counties, localities, and 
     nonprofit entities to promote improving access to dependable, 
     affordable automobiles by low-income families with children.
       ``(D) Grant approval criteria.--The Secretary shall 
     establish criteria for approval of an application for a grant 
     under this paragraph that include consideration of--
       ``(i) the extent to which the proposal, if funded, is 
     likely to improve access to training and employment 
     opportunities and child care services by low-income families 
     with children by means of car ownership;
       ``(ii) the level of innovation in the applicant's grant 
     proposal; and
       ``(iii) any partnerships between the public and private 
     sector in the applicant's grant proposal.
       ``(E) Use of funds.--
       ``(i) In general.--A grant awarded under this paragraph 
     shall be used to administer programs that assist low-income 
     families with children with dependable automobile ownership, 
     and maintenance of, or insurance for, the purchased 
     automobile.
       ``(ii) Supplement not supplant.--Funds provided to a State, 
     Indian tribe, county, or locality under a grant awarded under 
     this paragraph shall be used to supplement and not supplant 
     other State, county, or local public funds expended for car 
     ownership programs.
       ``(iii) General rules governing use of funds.--The rules of 
     section 404, other than subsection (b) of that section, shall 
     not apply to a grant made under this paragraph.
       ``(F) Application.--Each applicant desiring a grant under 
     this paragraph shall submit an application to the Secretary 
     at such time, in such manner, and accompanied by such 
     information as the Secretary may reasonably require.
       ``(G) Reversion of funds.--Any funds not expended by a 
     grantee within 3 years after the date the grant is awarded 
     under this paragraph shall be available for redistribution 
     among other grantees in such manner and amount as the 
     Secretary may determine, unless the Secretary extends by 
     regulation the time period to expend such funds.
       ``(H) Limitation on administrative costs of the 
     secretary.--Not more than an amount equal to 5 percent of the 
     funds appropriated to make grants under this paragraph for a 
     fiscal year shall be expended for administrative costs of the 
     Secretary in carrying out this paragraph.
       ``(I) Evaluation.--The Secretary shall, by grant, contract, 
     or interagency agreement, conduct an evaluation of the 
     programs administered with grants awarded under this 
     paragraph.
       ``(J) Authorization of appropriations.--There is authorized 
     to be appropriated to the Secretary to make grants under this 
     paragraph, $20,000,000 for each of fiscal years 2004 through 
     2008.''.
       (b) Improving Use of TANF Funds for Car Ownership Matching 
     Funds.--Section 404(h)(2)(B) of the Social Security Act (42 
     U.S.C. 608(h)(2)(B)) is amended by adding at the end the 
     following:
       ``(iv) Automobile purchase or maintenance.--At the option 
     of the State, costs with respect to the purchase or 
     maintenance of an automobile.''.

     SEC. 408. PATHWAY TO SELF-SUFFICIENCY GRANTS TO IMPROVE 
                   COORDINATION OF ASSISTANCE FOR LOW-INCOME 
                   FAMILIES.

       (a) Definitions.--In this section:
       (1) Eligible applicant.--The term ``eligible applicant'' 
     means a State or local government agency or a nonprofit 
     entity.
       (2) Secretary.--The term ``Secretary'' means the Secretary 
     of Health and Human Services.
       (3) State.--The term ``State'' means each of the 50 States 
     of the United States, the District of Columbia, the 
     Commonwealth of Puerto Rico, American Samoa, Guam, and the 
     United States Virgin Islands.
       (4) Support program for low-income families.--The term 
     ``support program for low-income families'' means a program 
     designed to provide low-income families and noncustodial 
     parents who need help with obtaining employment and 
     fulfilling child support obligations to children receiving 
     assistance under the temporary assistance to needy families 
     program established under part A of title IV of the Social 
     Security Act (42 U.S.C. 601 et seq.) with assistance or 
     benefits to enable the family or noncustodial parent to 
     become self-sufficient and includes--
       (A) the temporary assistance to needy families program 
     established under part A of title IV of the Social Security 
     Act (42 U.S.C. 601 et seq.);
       (B) the food stamp program established under the Food Stamp 
     Act of 1977 (7 U.S.C. 2011 et seq.);
       (C) the medicaid program funded under title XIX of the 
     Social Security Act (42 U.S.C. 1396 et seq.);
       (D) the State children's health insurance program (SCHIP) 
     funded under title XXI of the Social Security Act (42 U.S.C. 
     1397aa et seq.);
       (E) the child care program funded under the Child Care 
     Development Block Grant Act of 1990 (42 U.S.C. 9858 et seq.);
       (F) the child support program funded under part D of title 
     IV of the Social Security Act (42 U.S.C. 651 et seq.);
       (G) the earned income tax credit under section 32 of the 
     Internal Revenue Code of 1986;
       (H) the low-income home energy assistance program (LIHEAP) 
     established under the Low-Income Home Energy Assistance Act 
     of 1981 (42 U.S.C. 8621 et seq.);
       (I) the special supplemental nutrition program for women, 
     infants, and children (WIC) established under section 17 of 
     the Child Nutrition Act of 1966 (42 U.S.C. 1786);
       (J) programs under the Workforce Investment Act of 1998 (29 
     U.S.C. 2801 et seq.);
       (K) programs supporting low-income housing assistance 
     programs; and
       (L) any other Federal, State, or locally funded program 
     designed to provide family and work support to low-income 
     families.

[[Page S9734]]

       (b) Authority To Award Grants.--
       (1) In general.--The Secretary may award grants to eligible 
     applicants to--
       (A) improve the coordination of support programs for low-
     income families and noncustodial parents described in 
     subsection (a)(4); and
       (B) conduct outreach to such families and noncustodial 
     parents to promote enrollment in such programs.
       (2) Preference.--In awarding grants under this section, the 
     Secretary shall give preference to eligible applicants that 
     include in the application submitted under subsection (c) 
     documentation demonstrating that the eligible applicant will 
     collaborate with other Federal, State, or local agencies or 
     nonprofit entities in carrying out activities under the 
     grant.
       (c) Application.--Each eligible applicant desiring a grant 
     under this section shall submit an application to the 
     Secretary at such time, in such manner, and accompanied by 
     such information as the Secretary may require.
       (d) Annual Reports.--
       (1) In general.--The Secretary shall submit an interim and 
     final report to Congress describing the uses of grant funds 
     awarded under this section.
       (2) Dates for submission.--With respect to the reports 
     required under paragraph (1), the Secretary shall submit--
       (A) the interim report, not later than December 31, 2006; 
     and
       (B) the final report, not later than December 31, 2009.
       (e) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $50,000,000 for 
     the period of fiscal years 2004 through 2008.
       (f) Annual Assessment of Regional Labor Markets To Target 
     Higher Entry Level Wage Opportunities in Industries 
     Experiencing Labor Shortages.--
       (1) In general.--An State to which a grant is made under 
     this section annually shall conduct an assessment of its 
     regional labor markets that includes the following:
       (A) Labor market.--The assessment shall--
       (i) identify industries or occupations that have or expect 
     growth, the loss of skilled workers, or that have a demand 
     for a subset of workers;
       (ii) identify the entry-level education and skills 
     requirements for the industries or occupations that have or 
     anticipate a need for workers; and
       (iii) analyze the entry-level wages and benefits in 
     identified industries or occupations.
       (B) Job seekers.--The assessment shall create a profile of 
     the characteristics of the unemployed and underemployed 
     residents of the State, including educational attainment, 
     barriers to employment, geographic concentrations, and access 
     to needed support services.
       (C) Education and training infrastructure.--The assessment 
     shall create a profile of the State's available education, 
     training, and support services to prepare workers for the 
     identified industries or occupations.
       (D) Aligning industries and job seeker needs.--The 
     assessment shall compare the characteristics of the 
     identified industries or occupations to the profiles created 
     under subparagraphs (B) and (C).
       (2) Provision of information to localities.--The State 
     shall share with local political subdivisions of the State--
       (A) information regarding the existence of higher entry-
     wage job opportunities in industries experiencing labor 
     shortages; and
       (B) opportunities for collaboration with institutions of 
     higher education, community-based organizations, and economic 
     development and welfare agencies.
       (3) Data.--A State may use data available as of the date 
     the State begins an assessment under paragraph (1) to conduct 
     such assessment if such data provides the information 
     necessary to conduct the assessment described in that 
     paragraph.
       (4) Reports.--
       (A) State reports.--Each State to which a grant is made 
     under this section annually shall submit a report to the 
     Secretary that contains the assessment required under 
     paragraph (1).
       (B) Report to congress.--The Secretary annually shall 
     submit a report to Congress compiling the State reports 
     submitted under subparagraph (A).

     SEC. 409. TRANSITIONAL JOBS PROGRAMS.

       Section 403(a) (42 U.S.C. 603(a)), as amended by section 
     407(a), is amended by adding at the end the following:
       ``(8) Transitional jobs grants.--
       ``(A) Purpose.--The purpose of this paragraph is to provide 
     funding so that States and localities can create and expand 
     transitional jobs programs that--
       ``(i) combine time-limited employment that is subsidized 
     with public funds, with skill development and barrier removal 
     activities, pursuant to an individualized plan;
       ``(ii) provide job development and placement assistance to 
     individual program participants to help them move from 
     subsidized employment in transitional jobs into unsubsidized 
     employment, as well as retention services after the 
     transition to unsubsidized employment; and
       ``(iii) serve recipients of assistance under the State 
     program funded under this part and other low-income 
     individuals who have been unable to secure employment through 
     job search or other employment-related services because of 
     limited skills, experience, or other barriers to employment.
       ``(B) Limitations on use of funds.--
       ``(i) Allowable activities.--An entity to which funds are 
     provided under this paragraph shall use the funds to operate 
     transitional jobs programs consistent with the following:

       ``(I) An entity which secures a grant to operate a 
     transitional jobs program (in this subparagraph referred to 
     as a `program operator'), under this paragraph shall place 
     eligible individuals in temporary, publicly subsidized jobs. 
     Individuals placed in such jobs shall perform work directly 
     for the program operator, or at other public and nonprofit 
     organizations (in this subparagraph referred to as `worksite 
     employers') within the community. Funds provided under this 
     paragraph shall be used to subsidize 100 percent of the wages 
     paid to program participants as well as employer-paid payroll 
     costs for such participants.
       ``(II) Transitional jobs programs shall provide paid 
     employment for not less than 30, nor more than 40 hours per 
     week, except that a parent with a child under the age of 6, a 
     child who is disabled, or a child with other special needs, 
     or an individual who for other reasons cannot successfully 
     participate for 30 to 40 hours per week, may, at State 
     discretion, be allowed to participate for more limited hours, 
     but not less than 20 hours per week.
       ``(III) Program operators shall provide case management 
     services and ensure that appropriate education, training, and 
     other services are available to program participants 
     consistent with an individual plan developed for each such 
     participant.
       ``(IV) Program operators shall provide job placement 
     assistance to help program participants obtain unsubsidized 
     employment, and shall provide retention services for 12 
     months after entry into unsubsidized employment.

       ``(V) In any work week in which a program participant is 
     employed at least 30 hours, not less than 20 percent, nor 
     more than 50 percent of scheduled hours shall involve 
     participation in education or training activities designed to 
     improve the participant's employability and potential 
     earnings, or other services designed to reduce or eliminate 
     any barriers that may impede the participant's ability to 
     secure unsubsidized employment.
       ``(VI) The maximum duration of any placement in a 
     transitional jobs program shall not be less than 6 months, 
     nor more than 24 months. Nothing in this subclause shall be 
     construed to bar a program participant from moving into 
     unsubsidized employment at a point prior to the maximum 
     duration of the program. States may approve programs of 
     varying durations consistent with this subclause.
       ``(VII) Program participants shall be paid at the rate paid 
     to unsubsidized employees of the worksite employer (or 
     program operator where work is performed directly for the 
     program operator) who perform comparable work at the worksite 
     where the individual is placed. If no other employees perform 
     the same or comparable work then wages shall be set, at a 
     minimum, at 50 percent of the Lower Living Standard Income 
     Level (in this subparagraph referred to as the `LLSIL'), as 
     specified in section 101(24) of the Workforce Investment Act 
     of 1998, for a family of 3 based on 35 hours per week.
       ``(VIII) Program participants shall receive supervision 
     from the worksite employer or program operator consistent 
     with the goal of addressing the limited work experience and 
     skills of program participants.

       ``(ii) Consultation.--An application submitted by an entity 
     seeking to become a program operator shall include an 
     assurance by the applicant that the transitional jobs program 
     carried out by the applicant shall--

       ``(I) provide in the design, recruitment, and operation of 
     the program for broad-based input from the community served 
     and potential participants in the program and community-based 
     agencies with a demonstrated record of experience in 
     providing services, prospective worksite employers, local 
     labor organizations representing employees of prospective 
     worksite employers, if these entities exist in the area to be 
     served by the program, and employers, and membership-based 
     groups that represent low-income individuals; and
       ``(II) prior to the placement of program participants, 
     consult with the appropriate local labor organization, if 
     any, representing employees in the area who are engaged in 
     the same or similar work as that proposed to be carried out 
     by such program.

       ``(iii) Eligibility for other work supports.--Program 
     participants shall be eligible for subsidized child care, 
     transportation assistance, and other needed support services 
     on the same basis as other recipients of cash assistance 
     under the State program funded under this part.
       ``(iv) Wages not considered assistance.--Wages paid to 
     program participants shall not be considered to be assistance 
     for purposes of section 408(a)(7).
       ``(v) Private sector placements.--Not more than 50 percent 
     of the total number of such participants in transitional jobs 
     in a State at any time may be placed at worksite employers 
     which are private, for-profit entities.
       ``(C) General eligibility.--
       ``(i) In general.--Not less than \2/3\ of the participants 
     in a transitional jobs program funded under a grant made 
     under this paragraph during a fiscal year shall be 
     individuals who are, at the time they enter the program--

[[Page S9735]]

       ``(I) receiving assistance under the State program funded 
     under this part;
       ``(II) not receiving assistance under the State program 
     funded under this part, but who are unemployed, and who were 
     recipients of such assistance within the immediately 
     preceding 12-month period;
       ``(III) custodial parents of a minor child who meet the 
     financial eligibility criteria for assistance under the State 
     program funded under this part; or
       ``(IV) noncustodial parents with income below 150 percent 
     of the poverty line (as defined in section 673(2) of the 
     Omnibus Budget Reconciliation Act of 1981, including any 
     revision required by such section, applicable to a family of 
     the size involved).

       ``(ii) Limitation.--Not more than \1/3\ of all participants 
     in a transitional jobs program funded under this paragraph 
     during a fiscal year shall be individuals who have attained 
     at least age 18 with an income below 150 percent of the 
     poverty line (as defined in section 673(2) of the Omnibus 
     Budget Reconciliation Act of 1981, including any revision 
     required by such section, applicable to a family of the size 
     involved) who are not eligible under clause (i). An 
     individual who is an ex-offender shall be eligible to 
     participate in a transitional jobs program funded under this 
     paragraph.
       ``(iii) Methodology.--The Secretary may use any reasonable 
     methodology in calculating whether program participants 
     satisfying the requirements of clause (i), constitute \2/3\ 
     or more of all participants, and whether program participants 
     satisfying the requirements of clause (ii) constitute not 
     more than \1/3\ of all such participants in a fiscal year.
       ``(iv) Authority to provide work-related services to 
     individuals who have reached the 5-year limit.--A program 
     operator under this paragraph may use the funds to provide 
     transitional job program participation to individuals who, 
     but for section 408(a)(7), would be eligible for assistance 
     under the program funded under this part of the State in 
     which the program operator is located.
       ``(D) Relationship to other provisions of this part.--
       ``(i) Rules governing use of funds.--The provisions of 
     section 404 (other than subsection (f) thereof) shall not 
     apply to a grant made under this paragraph.
       ``(ii) Administration.--Section 416 shall not apply to the 
     programs under this paragraph.
       ``(iii) Prohibition against use of grant funds for any 
     other fund matching requirement.--An entity to which funds 
     are provided under this paragraph shall not use any part of 
     the funds to fulfill any obligation of any State or political 
     subdivision under subsection (b) or section 418 or any other 
     provision of this Act or other Federal law.
       ``(iv) Deadline for expenditure.--An entity to which funds 
     are provided under this paragraph shall remit to the 
     Secretary of Labor any part of the funds that are not 
     expended within 3 years after the date on which the funds are 
     so provided.
       ``(v) Regulations.--Within 90 days after the date of 
     enactment of this paragraph, the Secretary of Labor, after 
     consultation with the Secretary of Health and Human Services, 
     shall prescribe such regulations as may be necessary to 
     implement this paragraph.
       ``(vi) Reporting requirements.--The Secretary of Labor, in 
     consultation with the Secretary of Health and Human Services, 
     shall establish requirements for the collection and 
     maintenance of financial and program participant information 
     and the reporting of such information by entities carrying 
     out activities under this paragraph. Such reporting 
     requirements shall include, at a minimum, that States report 
     disaggregated data on individual program participants that 
     include the following:

       ``(I) Demographic information about the program participant 
     including education level, literacy level, and prior work 
     experience.
       ``(II) Identity of the program operator that provides or 
     provided services to the program participant, and the 
     duration of participation.
       ``(III) The nature of education, training or other services 
     received by the program participant.
       ``(IV) Reasons for the program participant's leaving the 
     program.
       ``(V) Whether the program participant secured unsubsidized 
     employment during or within 60 days after the employment of 
     the participant in a transitional job, and if so, details 
     about the participant's unsubsidized employment including 
     industry, occupation, starting wages and hours, and 
     availability of employer sponsored health insurance and sick 
     and vacation leave.

       ``(vii) Additional reporting requirements.--States shall 
     collect and report followup data for a sampling of program 
     participants reflecting their employment and earning status 
     12 months after entering unsubsidized employment.
       ``(E) National competitive grants.--
       ``(i) In general.--The Secretary of Labor shall award 
     grants in accordance with this paragraph, in fiscal years 
     2003 through 2007, for transitional jobs programs proposed by 
     eligible applicants, based on the following:

       ``(I) The extent to which the proposal seeks to provide 
     services in multiple sites that include sites in more than 1 
     State.
       ``(II) The extent to which the proposal seeks to provide 
     services in a labor market area or region that includes 
     portions of more than 1 State.
       ``(III) The extent to which the proposal seeks to provide 
     transitional jobs in a State.
       ``(IV) The extent to which the applicant proposes to 
     provide transitional jobs in either rural areas or areas 
     where there are a high concentration of residents with income 
     that is less than the poverty line.
       ``(V) The effectiveness of the proposal in helping 
     individuals who are least job ready move into unsubsidized 
     jobs that provide pathways to stable employment and livable 
     wages.

       ``(ii) Eligible applicants.--In this paragraph, the term 
     `eligible applicant' means--

       ``(I) a Workforce Investment Board for a local workforce 
     area in a State;
       ``(II) a political subdivision of a State;
       ``(III) a State;
       ``(IV) an Indian tribe; or
       ``(V) a private entity.

       ``(iii) Funding.--Subject to subparagraphs (F) and (G), of 
     the amount appropriated in subparagraph (H) for a fiscal 
     year, $25,000,000 of such amount shall be used to make grants 
     under this paragraph for that fiscal year.
       ``(F) Funding for indian tribes.--1.5 percent of the amount 
     appropriated in subparagraph (H) for each fiscal year shall 
     be reserved for grants to Indian tribes.
       ``(G) Funding for evaluations of transitional jobs 
     programs.--1.5 percent of the amount appropriated in 
     subparagraph (H) for each fiscal year shall be reserved for 
     use by the Secretary to carry out subparagraph (I).
       ``(H) Appropriations.--
       ``(i) In general.--Out of any money in the Treasury of the 
     United States not otherwise appropriated, there are 
     appropriated for grants under this paragraph, $25,000,000 for 
     each of fiscal years 2004 through 2008.
       ``(ii) Availability.--The amounts made available pursuant 
     to clause (i) shall remain available for such period as is 
     necessary to make the grants provided for in this paragraph.
       ``(I) Evaluation of transitional jobs programs.--The 
     Secretary, in consultation with the Secretary of Labor--
       ``(i) shall develop a plan to evaluate the extent to which 
     transitional jobs programs funded under this paragraph have 
     been effective in promoting sustained, unsubsidized 
     employment for each group of eligible participants;
       ``(ii) may evaluate the use of such grants by such 
     grantees/ as the Secretary deems appropriate, in accordance 
     with an agreement entered into with the grantees after good-
     faith negotiations; and
       ``(iii) should include the following outcome measures in 
     the plan developed under clause (i):

       ``(I) Placements in unsubsidized employment.
       ``(II) Placements in unsubsidized employment that last for 
     at least 12 months, and the extent to which individuals are 
     employed continuously for at least 12 months.
       ``(III) Earnings of individuals who obtain employment at 
     the time of placement.
       ``(IV) Earnings of individuals 1 year after placement.
       ``(V) The occupations and industries in which wage growth 
     and retention performance is greatest.
       ``(VI) Average expenditures per participant.''.

     SEC. 410. GAO STUDY ON IMPACT OF BAN ON SSI BENEFITS FOR 
                   LEGAL IMMIGRANTS.

       (a) Study.--The Comptroller General of the United States 
     shall conduct a study to determine the impact of the 
     prohibition under section 402 of the Personal Responsibility 
     and Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 
     1612) with respect to the eligibility of qualified aliens (as 
     defined in section 431 of such Act (8 U.S.C. 1641)) for 
     benefits under the supplemental security income program under 
     title XVI of the Social Security Act (42 U.S.C. 1381 et 
     seq.), including supplementary payments pursuant to an 
     agreement for Federal administration under section 1616(a) of 
     such Act (42 U.S.C. 1382e) and payments pursuant to an 
     agreement entered into under section 212(b) of Public Law 93-
     66.
       (b) Report.--Not later than 1 year after the date of 
     enactment of this Act, the Comptroller General shall submit a 
     report to Congress on the study conducted under subsection 
     (a) that includes such recommendations for legislative action 
     as the Comptroller General determines appropriate.

     SEC. 411. ENSURING TANF FUNDS ARE NOT USED TO DISPLACE PUBLIC 
                   EMPLOYEES; APPLICATION OF WORKPLACE LAWS TO 
                   WELFARE RECIPIENTS.

       (a) Welfare-to-Work Worker Protections.--
       (1) In general.--Section 403(a)(5)(I) (42 U.S.C. 
     603(a)(5)(I)) is amended--
       (A) by striking clauses (i) and (iv);
       (B) by redesignating clauses (v) and (vi) as clauses (iv) 
     and (v), respectively; and
       (C) by inserting before clause (ii), the following:
       ``(i) Nondisplacement.--

       ``(I) In general.--An adult in a family receiving 
     assistance under a State program funded under this part, in 
     order to engage in a work activity, shall not displace any 
     employee or position (including partial displacement, such as 
     a reduction in the hours of nonovertime work, wages, or 
     employment benefits) or fill any unfilled vacancy.
       ``(II) Prohibitions.--A work activity engaged in under a 
     program operated with funds provided under this paragraph 
     shall not impair any existing contract for services, be 
     inconsistent with any existing law, regulation, or collective 
     bargaining agreement, or infringe upon the recall rights or 
     promotional opportunities of any worker.

[[Page S9736]]

       ``(III) No supplanting of other hires.--A work activity 
     engaged in under a program operated with funds provided under 
     this paragraph shall be in addition to any activity that 
     otherwise would be available and shall not supplant the 
     hiring of an employed worker not funded under such program.
       ``(IV) Enforcing antidisplacement protections.--

       ``(aa) In general.--The State shall establish and maintain 
     an impartial grievance procedure to resolve any complaints 
     alleging violations of the requirements of subclause (I), 
     (II), or (III) within 60 days of receipt of the complaint 
     and, if a decision is adverse to the party who filed such 
     grievance or no decision has been reached, provide for the 
     completion of an arbitration procedure within 75 days of 
     receipt of the complaint or the adverse decision or 
     conclusion of the 60-day period, whichever is earlier.
       ``(bb) Appeals.--Appeals may be made to the Secretary who 
     shall make a decision within 75 days.
       ``(cc) Remedies.--Remedies for a violation of the 
     requirements of subclause (I), (II), or (III) shall include 
     termination or suspension of payments, prohibition of the 
     placement of the participant, reinstatement of an employee, 
     and other relief to make an aggrieved employee whole.
       ``(dd) Limitation on placement.--If a grievance is filed 
     regarding a proposed placement of a participant, such 
     placement shall not be made unless such placement is 
     consistent with the resolution of the grievance pursuant to 
     this subclause.''.
       (2) State plan requirement.--Section 402(a)(1)(A) (42 
     U.S.C. 602(a)(1)(A)) is amended by adding at the end the 
     following:
       ``(vii) In the case of a State that receives a welfare-to-
     work grant under section 403(a)(5), ensure compliance with 
     the nondisplacement requirements of subparagraph (I)(i) of 
     that section.''.
       (b) Application of Workplace Laws to Welfare Recipients.--
     Notwithstanding any other provision of law, workplace laws, 
     including the Fair Labor Standards Act of 1938 (29 U.S.C. 201 
     et seq.), the Occupational Safety and Health Act of 1970 (29 
     U.S.C. 651 et seq.), title VII of the Civil Rights Act of 
     1964 (42 U.S.C. 2000e et seq.), and the Americans with 
     Disabilities Act of 1990 (42 U.S.C. 12101 et seq.), shall 
     apply to an individual who is a recipient of assistance under 
     the temporary assistance to needy families program funded 
     under part A of title IV of the Social Security Act (42 
     U.S.C. 601 et seq.) in the same manner as such laws apply to 
     other workers. The fact that an individual who is a recipient 
     of assistance under the temporary assistance to needy 
     families program is participating in, or seeking to 
     participate in work activities under that program in 
     satisfaction of the work activity requirements of the 
     program, shall not deprive the individual of the protection 
     of any Federal, State, or local workplace law.

     SEC. 412. DATA COLLECTION AND REPORTING.

       Section 411(a)(1)(A) (42 U.S.C. 611(a)(1)(A)) is amended in 
     the matter preceding clause (i), by striking ``(except for 
     information relating to activities carried out under section 
     403(a)(5))'' and inserting `` (and in complying with this 
     requirement, the Secretary shall require not more than 10 
     States to ensure that the following case record information 
     is reported in a manner that permits analysis of such 
     information by race, ethnicity or national origin, primary 
     language, gender, and educational level, including analysis 
     using a combination of these factors, and shall submit an 
     annual report to Congress containing such data)''.

                         TITLE V--MISCELLANEOUS

     SEC. 501. EFFECTIVE DATE.

       (a) In General.--Except as otherwise provided, the 
     amendments made by this Act shall take effect on the date of 
     enactment of this Act, and shall apply to payments under 
     parts A and D of title IV of the Social Security Act for 
     calendar quarters beginning on or after such date, without 
     regard to whether regulations to implement the amendments are 
     promulgated by such date.
       (b) Delay Permitted if State Legislation Required.--In the 
     case of a State plan under section 402(a) or 454 of the 
     Social Security Act (42 U.S.C. 602(a), 654) which the 
     Secretary of Health and Human Services determines requires 
     State legislation (other than legislation appropriating 
     funds) in order for the plan to meet the additional 
     requirements imposed by the amendments made by this Act, the 
     State plan shall not be regarded as failing to comply with 
     the requirements of such section 402(a) or 454 solely on the 
     basis of the failure of the plan to meet such additional 
     requirements before the 1st day of the 1st calendar quarter 
     beginning after the close of the 1st regular session of the 
     State legislature that begins after the date of enactment of 
     this Act. For purposes of the previous sentence, in the case 
     of a State that has a 2-year legislative session, each year 
     of such session shall be deemed to be a separate regular 
     session of the State legislature.
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