[Congressional Record Volume 169, Number 147 (Tuesday, September 12, 2023)]
[Senate]
[Pages S4394-S4397]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

  SA 1096. Mr. LEE submitted an amendment intended to be proposed to 
amendment SA 1092 submitted by Mrs. Murray (for herself and Ms. 
Collins) and intended to be proposed to the bill H.R. 4366, making 
appropriations for military construction, the Department of Veterans 
Affairs, and related agencies for the fiscal year ending September 30, 
2024, and for other purposes; which was ordered to lie on the table; as 
follows:

        On page 208 of the amendment, insert between lines 6 and 7 
     the following:

              TITLE VIII--POVERTY MEASUREMENT IMPROVEMENT

     SEC. 801. IMPROVING THE MEASUREMENT OF POVERTY IN THE UNITED 
                   STATES.

       (a) Definitions.--In this section:
       (1) Federal benefit.--The term ``Federal benefit'' means a 
     benefit, refundable tax credit, or other form of assistance 
     provided under any of the following programs:
       (A) Earned Income Tax Credit (refundable portion).
       (B) Child Tax Credit (refundable portion).
       (C) Supplemental Security Income.
       (D) Temporary Assistance for Needy Families.
       (E) Title IV-E Foster Care.
       (F) Title IV-E Adoption Assistance.
       (G) Medicaid.
       (H) SCHIP.
       (I) Indian Health Services.
       (J) PPACA refundable premium assistance and cost sharing 
     tax credit.
       (K) Assets for Independence program.
       (L) Supplemental Nutrition Assistance Food Program.
       (M) School Breakfast.
       (N) School Lunch.
       (O) Women, Infants, and Children (WIC) Food Program.
       (P) Child and Adult Care Food Program.
       (Q) The Food Distribution Program on Indian Reservations 
     (FDPIR).
       (R) Nutrition Program for the Elderly.
       (S) Seniors Farmers' Market Nutrition Program.
       (T) Commodity Supplemental Food Program.
       (U) Section 8 Housing.
       (V) Public Housing.
       (W) Housing for Persons with Disabilities.
       (X) Home Investment Partnership Program.
       (Y) Rural Housing Service.
       (Z) Rural Housing Insurance Fund.
       (AA) Low-Income Home Energy Assistance Program.
       (BB) Universal Service Fund Low Income Support Mechanism 
     (subsidized phone services).
       (CC) Pell Grants.
       (DD) Supplemental Educational Opportunity Grants.
       (EE) American Opportunity Tax Credit (refundable portion).
       (FF) Healthy Start.
       (GG) Job Corps.
       (HH) Head Start (including Early Head Start).
       (II) Weatherization Assistance.
       (JJ) Chafee Foster Care Independence Program.
       (KK) Child Care Subsidies from the Child Care and 
     Development Fund.
       (LL) Child Care from the Temporary Assistance for Needy 
     Families Block Grant.
       (MM) Emergency Assistance to Needy Families with Children.
       (NN) Senior Community Service Employment Program.
       (OO) Migrant and Seasonal Farm Workers Training Program.
       (PP) Indian and Native American Employment and Training 
     Program.
       (QQ) Independent Living Education and Training Vouchers.
       (2) Resource unit.--The term ``resource unit'' means all 
     co-resident individuals who are related by birth, marriage, 
     or adoption, plus any co-resident unrelated children, foster 
     children, and unmarried partners and their relatives.
       (3) Market income.--The term ``market income'' means 
     individual income from the following:
       (A) Earnings.
       (B) Interest.
       (C) Dividends.
       (D) Rents, royalties, and estates and trusts.
       (E) The monetary value of employer-sponsored health 
     insurance benefits.
       (F) Other forms of income, as determined by the Director.
       (4) Entitlement and other income.--The term ``entitlement 
     and other income'' means income from the following:
       (A) Unemployment (insurance) compensation.
       (B) Workers' compensation.
       (C) Social Security.
       (D) Veterans' payments and benefits.
       (E) Survivor benefits.
       (F) Disability benefits (not including benefits under the 
     Supplemental Security Income program).
       (G) Pension or retirement income.
       (H) Alimony.
       (I) Child support.
       (J) Financial assistance from outside of the household.
       (K) Medicare.
       (5) Entitlement and earned unit income.--The term 
     ``entitlement and earned unit income'' means the sum of all 
     market income and entitlement and other income.
       (6) Income tax data.--The term ``income tax data'' means 
     return information, as such term is defined under section 
     6103(b)(2) of the Internal Revenue Code of 1986.
       (7) Administering agency.--The term ``administering 
     agency'' means a State or Federal agency responsible for 
     administering a Federal benefit.
       (8) Total resource unit income.--The term ``total resource 
     unit income'' means, with respect to a resource unit, an 
     amount equal to--
       (A) the sum of--
       (i) all market income attributable to members of the unit;
       (ii) all entitlement and other income attributable to 
     members of the unit; and
       (iii) an amount, or cash equivalent, of all Federal 
     benefits received by members of the unit; minus
       (B) all State and Federal income and payroll taxes 
     attributable to members of the unit.
       (9) Earned resource unit income.--The term ``earned 
     resource unit income'' means, with respect to a resource 
     unit, all market income attributable to members of the unit.
       (10) Personally identifiable information.--The term 
     ``personally identifiable information'' means any information 
     that identifies an individual or could reasonably be used to 
     identify an individual that is--
       (A) collected pursuant to a survey conducted by the Bureau 
     of the Census; or
       (B) disclosed to the Bureau of the Census by an 
     administering agency for the purpose of carrying out 
     subsection (b).
       (11) Director.--The term ``Director'' means the Director of 
     the Bureau of the Census.
       (b) Verification of Data Collected in the Annual Social and 
     Economic Supplement to the Current Population Survey.--
       (1) In general.--Beginning in fiscal year 2024, in order to 
     more accurately determine the extent of poverty in the United 
     States and the anti-poverty effectiveness of Federal benefit 
     programs, the Director shall collect, in addition to the data 
     collected under the Annual Social and Economic Supplement to 
     the Current Population Survey, data from the appropriate 
     administering agencies related to the following:
       (A) Participation in any Federal benefit program and the 
     monetary or cash equivalent value of such benefit for an 
     individual, where possible, and otherwise for resource units 
     or households.
       (B) The total amount of market income for individuals.
       (C) The total amount of entitlement and other income for 
     individuals.
       (D) Payment of income taxes and payroll taxes for 
     individuals.
       (E) Total resource unit income.
       (F) Total earned resource unit income.
       (G) Any other information about benefits or income received 
     by individuals that the Director determines necessary to 
     carry out this section and that is not included in the data 
     relating to participation in Federal benefit programs or 
     market income for individuals.
       (2) Administering agency data.--Not later than 6 months 
     after receiving a request from the Director, the head of each 
     administering agency shall make available to the Director 
     such data (including income tax data) as the Director shall 
     require for the purpose of carrying out this subsection and 
     for the purposes outlined in section 6 of title 13, United 
     States Code.
       (3) Publication of data.--
       (A) Rates and other data.--
       (i) Report.--The Director shall submit to Congress, not 
     later than January 1, 2025, a report detailing the 
     implementation of this section, including--

       (I) the availability of related data;
       (II) the quality of the data; and
       (III) the methodology proposed for assigning dollar values 
     to the receipt of noncash Federal benefits.

       (ii) Tables and graphs.--The Director shall produce tables 
     and graphs showing for each year the poverty rates and 
     related data calculated using data collected under paragraph 
     (1), including--

       (I) the total resource unit income for survey respondents;
       (II) the total earned resource unit income for survey 
     respondents;
       (III) the total of all amounts described in subparagraphs 
     (A) through (G) of paragraph (1) that are received by survey 
     respondents;
       (IV) a breakdown of the amount of income taxes and payroll 
     taxes attributable to survey respondents; and
       (V) for 2027 and subsequent years, poverty rates calculated 
     using updated poverty thresholds as described in clause 
     (iii).

       (iii) Updated poverty thresholds.--For 2027 and subsequent 
     years, the Director shall, in addition to the official 
     poverty line (as defined by the Office of Management and 
     Budget) and the supplemental poverty measure, provide an 
     alternative poverty measure that uses the personal 
     consumption expenditure price index (as published by the 
     Bureau of Economic Analysis) and accounts for the

[[Page S4395]]

     data collected under paragraph (1). The Director shall 
     provide a comparison of the official poverty line (as defined 
     by the Office of Management and Budget), the supplemental 
     poverty measure rate as defined by the Bureau of the Census, 
     and the alternative poverty rate created using the 
     alternative poverty measure under this section.
       (iv) Rule of construction.--The Office of Management and 
     Budget shall not use the additional data collected by the 
     Director pursuant to paragraph (1) for purposes of defining 
     the official poverty line.
       (B) Confidentiality.--Consistent with the provisions of 
     sections 8, 9, and 23(c) of title 13, United States Code, the 
     Director shall ensure the confidentiality of information 
     furnished to the Director under this subsection.
       (c) Protection and Disclosure of Personally Identifiable 
     Information.--
       (1) In general.--The security, disclosure, and 
     confidentiality provisions set forth in sections 9 and 23 of 
     title 13, United States Code, shall apply to personally 
     identifiable information obtained by the Bureau of the Census 
     pursuant to this section.
       (2) Restricted access to personally identifiable 
     information.--Access to personally identifiable information 
     collected to supplement the restricted-use Current Population 
     Survey Annual Social and Economic Supplements in accordance 
     with subsection (b)(1) shall be available only to those who 
     have access to the Current Population Survey data with the 
     permission of the Bureau of the Census and in accordance with 
     any other applicable provision of law.
       (3) Penalties.--Any individual who knowingly accesses or 
     discloses personally identifiable information in violation of 
     this section shall be guilty of a felony and upon conviction 
     thereof shall be fined in an amount of not more than $300,000 
     under title 18, United States Code, or imprisoned for not 
     more than five years, or both.
       (d) State Reporting of Federal Data.--Beginning with the 
     first full calendar year that begins after the date of 
     enactment of this Act, with respect to any Federal benefit 
     that is administered at the State level by a State 
     administering agency, such State administering agency shall 
     submit each year to the Federal administering agency 
     responsible for administering the benefit at the Federal 
     level a report that identifies each resource unit that 
     received such benefits during such year by the personally 
     identifiable information of the head of the resource unit and 
     the amount, or cash equivalent, of such benefit received by 
     such resource unit.

     SEC. 802. COMMISSION ON VALUATION OF GOVERNMENT BENEFITS.

       (a) Establishment.--There is established within the United 
     States Census Bureau a commission, to be known as the 
     ``Commission on Valuation of Federal Benefits'' (referred to 
     in this section as the ``Commission'').
       (b) Composition.--
       (1) In general.--The Commission shall be composed of 8 
     members, of whom--
       (A) 2 members shall be appointed by the majority leader of 
     the Senate;
       (B) 2 members shall be appointed by the minority leader of 
     the Senate;
       (C) 2 members shall be appointed by the Speaker of the 
     House of Representatives; and
       (D) 2 members shall be appointed by the minority leader of 
     the House of Representatives.
       (2) Co-chairs.--Of the members of the Commission--
       (A) 1 co-chair shall be designated by the majority leader 
     of the Senate; and
       (B) 1 co-chair shall be designated by the Speaker of the 
     House of Representatives.
       (3) Qualifications.--Each member appointed to the 
     Commission shall have experience in--
       (A) quantitative policy research; and
       (B) welfare or poverty studies.
       (c) Initial Meeting.--Not later than 60 days after the date 
     on which the last member is appointed under subsection (b), 
     the Commission shall hold an initial meeting.
       (d) Quorum.--Six members of the Commission shall constitute 
     a quorum.
       (e) No Proxy Voting.--Proxy voting by members of the 
     Commission shall be prohibited.
       (f) Staff.--The Director of the Census Bureau shall appoint 
     an executive director of the Commission.
       (g) Travel Expenses.--Members of the Commission shall serve 
     without pay, but shall receive travel expenses in accordance 
     with sections 5702 and 5703 of title 5, United States Code.
       (h) Duties of Commission.--
       (1) Recommendations.--
       (A) In general.--The Commission shall produce 
     recommendations for the valuation of Federal benefits listed 
     under section 801(a)(1) for the purpose of United States 
     Census Bureau estimates of the Federal Poverty Level, 
     including non-cash benefits.
       (2) Report.--
       (A) In general.--Not later than 270 days after the date of 
     enactment of this Act, the Commission shall submit to 
     Congress a report of the recommendations required under 
     paragraph (1), including a detailed statement of methodology 
     and reasoning behind recommendations.
       (B) Public availability.--The report required by 
     subparagraph (A) shall be made available on an internet 
     website of the United States Government that is available to 
     the public.
       (i) Powers of Commission.--On request by the executive 
     director of the Commission, the head of a Federal agency 
     shall furnish information to the Commission.
       (j) Termination of Commission.--The Commission shall 
     terminate 90 days after the date on which the Commission 
     submits the report under subsection (h)(2).
       (k) Authorization of Appropriations.--There is authorized 
     to be appropriated $1,000,000 to carry out this section.

     SEC. 803. GAO REPORTS ON EFFECT OF SUPPLEMENTARY DATA ON 
                   CALCULATION OF POVERTY RATES AND RELATED 
                   MEASURES.

       Not later than January 1, 2028, and every 2 years 
     thereafter, the Comptroller General of the United States 
     shall submit to Congress a report that compares the poverty 
     rates and related measures calculated under the Annual Social 
     and Economic Supplement to the Current Population Survey with 
     the poverty rates and related measures calculated using the 
     data collected under section 801(b)(1).

     SEC. 804. RULE OF CONSTRUCTION.

        Nothing in this title shall be construed to affect the 
     eligibility of an individual or household for a Federal 
     benefit.

     SEC. 805. RULE OF CONSTRUCTION.

        Nothing in this title shall be construed to affect the 
     eligibility of an individual or household for a Federal 
     benefit.

  TITLE IX--MODIFICATIONS TO SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM

     SEC. 901. WORK REQUIREMENTS.

       (a) Declaration of Policy.--Section 2 of the Food and 
     Nutrition Act of 2008 (7 U.S.C. 2011) is amended by adding at 
     the end the following: ``Congress further finds that it 
     should also be the purpose of the supplemental nutrition 
     assistance program to increase employment, to encourage 
     healthy marriage, and to promote prosperous self-sufficiency, 
     which means the ability of households to maintain an income 
     above the poverty level without services and benefits from 
     the Federal Government.''.
       (b) Definition of Food.--Section 3(k) of the Food and 
     Nutrition Act of 2008 (7 U.S.C. 2012(k)) is amended by 
     striking ``means (1)'' and inserting ``means the following 
     foods, food products, meals, and other items, only if the 
     food, food product, meal, or other item is essential, as 
     determined by the Secretary: (1)''.
       (c) General Work Requirements.--Section 6(d)(1)(A) of the 
     Food and Nutrition Act of 2008 (7 U.S.C. 2015(d)(1)(A)) is 
     amended, in the matter preceding clause (i), by striking 
     ``60'' and inserting ``65''.
       (d) Hour-Based Work Requirement.--Section 6(o) of the Food 
     and Nutrition Act of 2008 (7 U.S.C. 2015(o)) is amended--
       (1) in paragraph (1)(C), by striking ``other than a 
     supervised job search program or job search training 
     program'' and inserting ``including an in-person supervised 
     job search program'';
       (2) in paragraph (3)--
       (A) in subparagraph (A), by striking ``50'' and inserting 
     ``64'';
       (B) by striking subparagraph (C); and
       (C) by redesignating subparagraphs (D) and (E) as 
     subparagraphs (C) and (D), respectively;
       (3) in paragraph (4)(A)--
       (A) in the matter preceding clause (i), by striking 
     ``area'' and inserting ``county or county equivalent'';
       (B) in clause (i), by striking ``or'' and inserting 
     ``and''; and
       (C) by striking clause (ii) and inserting the following:
       ``(ii) is not located within a labor market area, as 
     determined by data published by the Bureau of Labor 
     Statistics, that has an unemployment rate of over 10 
     percent.'';
       (4) in paragraph (6)(D), by striking ``15 percent'' and 
     inserting ``5 percent'';
       (5) by redesignating paragraph (7) as paragraph (8);
       (6) by inserting after paragraph (6) the following:
       ``(7) Work or work preparation hours requirement for 
     married couples with children.--The total combined number of 
     hours of work or work preparation activities under 
     subparagraphs (A), (B), and (C) of paragraph (2) for both 
     spouses in a married couple household with 1 or more children 
     over the age of 6 shall not be greater than the total number 
     of hours required under those subparagraphs for a single head 
     of household.''; and
       (7) by inserting after paragraph (8) (as so redesignated) 
     the following:
       ``(9) Minimum wage rule.--The limitation under subsection 
     (d)(4)(F)(i) shall not apply to any work requirement, 
     program, or activity required under this subsection.''.

     SEC. 902. EMPLOYMENT AND TRAINING PROGRAM OUTCOMES REPORTING.

       Not later than 1 year after the date of enactment of this 
     Act, the Secretary of Agriculture shall submit to Congress a 
     report, using data from the most recent 5 fiscal years 
     available, detailing the outcomes of beneficiaries of the 
     supplemental nutrition assistance program established under 
     the Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.) 
     (referred to in this section as ``SNAP'') who participate in 
     employment and training programs (as defined in section 
     6(d)(4)(B) of that Act (7 U.S.C. 2015(d)(4)(B))) for each of 
     those 5 years that includes the following information:
       (1) The number and percentage of SNAP beneficiaries in each 
     State who participated in an employment and training program 
     compared to the number and percentage of SNAP beneficiaries 
     in each State who did

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     not participate in an employment and training program.
       (2) The number and percentage of SNAP beneficiaries in each 
     State who obtained a job while participating in an employment 
     and training program compared to the number and percentage of 
     SNAP beneficiaries in each State who obtained a job but did 
     not participate in an employment and training program.
       (3) The number and percentage of SNAP beneficiaries in each 
     State who retained a job for 6 months, 1 year, and 5 years 
     after completing an employment and training program and 
     obtaining a job compared to the number and percentage of SNAP 
     beneficiaries in each State who retained a job for 6 months, 
     1 year, and 5 years but did not complete an employment and 
     training program prior to obtaining that job.
       (4) The increase or decrease in wages, if applicable, for 
     SNAP beneficiaries in each State who retained a job for 6 
     months, 1 year, and 5 years after completing an employment 
     and training program and obtaining a job compared to the 
     increase or decrease in wages, if applicable, for SNAP 
     beneficiaries in each State who retained a job for 6 months, 
     1 year, and 5 years but did not complete an employment and 
     training program prior to obtaining that job.
       (5) The number and percentage of SNAP beneficiaries who--
       (A) previously participated in an employment and training 
     program;
       (B) after that participation, obtained a job or stopped 
     receiving SNAP benefits; and
       (C) after regaining eligibility for SNAP benefits, 
     reentered an employment or training program.
       (6) The average duration that SNAP beneficiaries in each 
     State participated in an employment and training program.
       (7) A breakdown of--
       (A) the types of employment and training activities offered 
     by the employment and training program of each State; and
       (B) the types of jobs that States are preparing employment 
     and training program participants to obtain.

     SEC. 903. STATE MATCHING FUNDS.

       Section 4 of the Food and Nutrition Act of 2008 (7 U.S.C. 
     2013) is amended by adding at the end the following:
       ``(d) State Matching Funds.--
       ``(1) In general.--Each State that participates in the 
     supplemental nutrition assistance program shall, as a 
     condition of participation, be required to contribute 
     matching funds in an amount equal to, of the funds received 
     from the Secretary by the State for program administration--
       ``(A) for fiscal year 2024, 10 percent;
       ``(B) for fiscal year 2025, 15 percent;
       ``(C) for fiscal year 2026, 20 percent;
       ``(D) for fiscal year 2027, 25 percent;
       ``(E) for fiscal year 2028, 30 percent;
       ``(F) for fiscal year 2029, 35 percent;
       ``(G) for fiscal year 2030, 40 percent;
       ``(H) for fiscal year 2031, 45 percent; and
       ``(I) for fiscal year 2032 and each fiscal year thereafter, 
     50 percent.
       ``(2) Additional contributions permitted.--Nothing in this 
     subsection prevents a State from contributing matching funds 
     in an amount greater than the amount required under paragraph 
     (1) for the applicable fiscal year.''.

     SEC. 904. ELIGIBILITY.

       Section 5(a) of the Food and Nutrition Act of 2008 (7 
     U.S.C. 2014(a)) is amended--
       (1) in the second sentence, by inserting ``that are limited 
     to families whose income and resources satisfy financial need 
     criteria established in accordance with subsections (c) and 
     (g) by the State for receipt of the benefits'' after ``(42 
     U.S.C. 601 et seq.)''; and
       (2) by inserting after the second sentence the following: 
     ``To be deemed eligible for participation in the supplemental 
     nutrition assistance program under this subsection, a 
     household shall receive a cash or noncash means-tested public 
     benefit for at least 6 consecutive months valued at not less 
     than $50.''.

     SEC. 905. COMPLIANCE WITH FRAUD INVESTIGATIONS.

       Section 6(d) of the Food and Nutrition Act of 2008 (7 
     U.S.C. 2015(d)) is amended by adding at the end the 
     following:
       ``(5) Compliance with fraud investigations.--To be eligible 
     to participate in the supplemental nutrition assistance 
     program, an individual shall cooperate with any investigation 
     into fraud under that program, including full participation 
     in any--
       ``(A) meeting requested by fraud investigators; and
       ``(B) administrative hearing.''.

     SEC. 906. AUTHORIZED USERS OF ELECTRONIC BENEFIT TRANSFER 
                   CARDS.

       Section 7(h) of the Food and Nutrition Act of 2008 (7 
     U.S.C. 2016(h)) is amended by adding at the end the 
     following:
       ``(15) Authorized users.--
       ``(A) In general.--A State agency shall register--
       ``(i) at least 1 member of a household issued an EBT card 
     as an authorized user of the card; and
       ``(ii) an authorized representative of a household as an 
     authorized user of the EBT card issued to the household.
       ``(B) Limit.--Not more than 5 individuals shall be 
     registered as authorized users, including the authorized 
     representative of a household, on an EBT card.
       ``(C) Unauthorized use.--
       ``(i) In general.--An EBT card shall not be used by any 
     individual who is not an authorized user of the EBT card.
       ``(ii) 2 unauthorized uses.--If an EBT card has been used 2 
     times by an unauthorized user of the EBT card, the head of 
     the household to which the EBT card is issued shall be 
     required to review program rights and responsibilities with 
     personnel of the State agency.
       ``(iii) 4 unauthorized uses.--If an EBT card has been used 
     4 times by an unauthorized user of the EBT card, the State 
     agency shall suspend benefits for the household to which the 
     EBT card is issued for 1 month.
       ``(iv) 6 unauthorized uses.--If an EBT card has been used 6 
     times by an unauthorized user of the EBT card, the State 
     agency shall suspend benefits for the household to which the 
     EBT card is issued for 3 months.
       ``(v) 7 or more unauthorized uses.--If an EBT card has been 
     used 7 or more times by an unauthorized user of the EBT card, 
     the State agency shall suspend benefits for the household to 
     which the EBT card is issued for 1 month per unauthorized 
     use.
       ``(vi) Administration.--Any action taken under clauses (ii) 
     through (v) shall be consistent with sections 6(b) and 
     11(e)(10), as applicable.''.

     SEC. 907. REAUTHORIZATION OF MEDIUM- OR HIGH-RISK RETAIL FOOD 
                   STORES AND WHOLESALE FOOD CONCERNS.

       Section 9(a)(2)(A) of the Food and Nutrition Act of 2008 (7 
     U.S.C. 2018(a)(2)(A)) is amended by striking ``; and'' and 
     inserting ``, which, in the case of a retail food store or 
     wholesale food concern for which there is a medium risk or 
     high risk of fraudulent transactions, as determined by the 
     fraud detection system of the Food and Nutrition Service, 
     shall be annually; and''.

     SEC. 908. STATE ACTIVITY REPORTS.

       Section 11 of the Food and Nutrition Act of 2008 (7 U.S.C. 
     2020) is amended by adding at the end the following:
       ``(y) State Activity Reports.--The Secretary shall publish 
     for each fiscal year a report describing the activity of each 
     State in the supplemental nutrition assistance program, which 
     shall contain, for the applicable fiscal year, substantially 
     the same information as is contained in the report published 
     by the Food and Nutrition Service entitled `Supplemental 
     Nutrition Assistance Program State Activity Report Fiscal 
     Year 2016' and published September 2017.''.

     SEC. 909. DISQUALIFICATION BY STATE AGENCY.

       Section 12 of the Food and Nutrition Act of 2008 (7 U.S.C. 
     2021) is amended by adding at the end the following:
       ``(j) Disqualification by State Agency.--
       ``(1) In general.--Except as provided in paragraph (4), a 
     State agency shall permanently disqualify from participation 
     in the supplemental nutrition assistance program an approved 
     retail food store or wholesale food concern convicted of--
       ``(A) trafficking in food instruments (including any 
     voucher, draft, check, or access device (including an 
     electronic benefit transfer card or personal identification 
     number) issued in lieu of a food instrument under this Act); 
     or
       ``(B) selling firearms, ammunition, explosives, or 
     controlled substances (as defined in section 102 of the 
     Controlled Substances Act (21 U.S.C. 802)) in exchange for 
     food instruments (including any item described in 
     subparagraph (A) issued in lieu of a food instrument under 
     this Act).
       ``(2) Notice of disqualification.--The State agency shall--
       ``(A) provide the approved retail food store or wholesale 
     food concern with notification of the disqualification; and
       ``(B) make the disqualification effective on the date of 
     receipt of the notice of disqualification.
       ``(3) Prohibition of receipt of lost revenues.--A retail 
     food store or wholesale food concern shall not be entitled to 
     receive any compensation for revenues lost as a result of 
     disqualification under this subsection.
       ``(4) Exceptions in lieu of disqualification.--
       ``(A) In general.--A State agency may permit a retail food 
     store or wholesale food concern that, but for this paragraph, 
     would be disqualified under paragraph (1), to continue to 
     participate in the supplemental nutrition assistance program 
     if the State agency determines, in its sole discretion, 
     that--
       ``(i) disqualification of the retail food store or 
     wholesale food concern, as applicable, would cause hardship 
     to participants in the supplemental nutrition assistance 
     program; or
       ``(ii)(I) the retail food store or wholesale food concern 
     had, at the time of the violation under paragraph (1), an 
     effective policy and program in effect to prevent violations 
     described in paragraph (1); and
       ``(II) the ownership of the retail food store or wholesale 
     food concern was not aware of, did not approve of, and was 
     not involved in the conduct of the violation.
       ``(B) Civil penalty.--If a State agency under subparagraph 
     (A) permits a retail food store or wholesale food concern to 
     continue to participate in the supplemental nutrition 
     assistance program in lieu of disqualification, the State 
     agency shall assess a civil penalty in an amount determined 
     by the State agency, except that--
       ``(i) the amount of the civil penalty shall not exceed 
     $10,000 for each violation; and
       ``(ii) the amount of civil penalties imposed for violations 
     investigated as part of a single investigation may not exceed 
     $40,000.
       ``(C) Reporting.--
       ``(i) To the secretary.--If a State agency under 
     subparagraph (A) permits a retail food

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     store or wholesale food concern to continue to participate in 
     the supplemental nutrition assistance program in lieu of 
     disqualification, the State agency shall annually submit to 
     the Secretary a report describing the justification of the 
     State agency for that action.
       ``(ii) To congress.--The Secretary shall annually submit to 
     Congress a report compiling the information contained in 
     reports submitted to the Secretary under clause (i).''.

     SEC. 910. RETENTION OF RECAPTURED FUNDS BY STATES.

       Section 16(a) of the Food and Nutrition Act of 2008 (7 
     U.S.C. 2025(a)) is amended--
       (1) in the second sentence, by striking ``The officials'' 
     and inserting the following:
       ``(3) Prohibition.--The officials'';
       (2) in the first sentence--
       (A) by redesignating paragraphs (1) through (9) as 
     subparagraphs (A) through (I), respectively; and
       (B) by striking ``section 17(n): Provided, That the 
     Secretary'' and inserting the following: ``section 17(n).
       ``(2) Administration on indian reservations and in native 
     villages.--
       ``(A) In general.--The Secretary'';
       (3) in paragraph (2) (as so designated)--
       (A) in subparagraph (A), by striking ``35 percent'' and 
     inserting ``50 percent''; and
       (B) by adding at the end the following:
       ``(B) Use of retained amounts for fraud investigations.--
     The value of funds or allotments recovered or collected 
     pursuant to sections 6(b) and 13(c) that are retained by a 
     State under subparagraph (A) in excess of 35 percent shall be 
     used by the State for investigations of fraud in the 
     supplemental nutrition assistance program.''; and
       (4) by striking the subsection designation and all that 
     follows through ``Subject to'' in the matter preceding 
     paragraph (2) (as so designated) and inserting the following:
       ``(a) Administrative Cost-Sharing.--
       ``(1) In general.--Subject to''.
                                 ______