[House Report 107-465]
[From the U.S. Government Publishing Office]
107th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 107-465
======================================================================
PROVIDING FOR CONSIDERATION OF H.R. 4735, PERSONAL RESPONSIBILITY,
WORK, AND FAMILY PROMOTION ACT OF 2002
_______
May 15 (legislative day, May 14), 2002.--Referred to the House Calendar
and ordered to be printed
_______
Ms. Pryce of Ohio, from the Committee on Rules, submitted the following
R E P O R T
[To accompany H. Res. 421]
The Committee on Rules, having had under consideration
House Resolution 421, by a nonrecord vote, report the same to
the House with the recommendation that the resolution be
adopted.
summary of provisions of the resolution
The resolution provides for the consideration of H.R. 4735,
the Personal Responsibility, Work, and Family Promotion Act of
2002, under a modified closed rule. The rule waives all points
of order against consideration of the bill.
The rule provides two hours of debate in the House, with 50
minutes equally divided and controlled by the chairman and
ranking minority member of the Committee on Ways and Means, 40
minutes equally divided and controlled by the chairman and
ranking minority member of the Committee on Education and the
Workforce, and 30 minutes equally divided and controlled by the
chairman and ranking minority member of the Committee on Energy
and Commerce.
The rule makes in order the amendment printed in this
report, if offered by Representative Cardin of Maryland or his
designee, which shall be considered as read, and shall be
separately debatable for one hour equally divided and
controlled by the proponent and an opponent. The rule waives
all points of order against the amendment printed in the
report.
Finally, the rule provides one motion to recommit with or
without instructions.
COMMITTEE VOTES
Pursuant to clause 3(b) of House rule XIII the results of
each record vote on an amendment or motion to report, together
with the names of those voting for and against, are printed
below:
Rules Committee record vote No. 90
Date: May 14, 2002.
Measure: H.R. 4735.
Motion by: Mr. McGovern.
Summary of motion: To make in order the amendment offered
by Mr. Becerra, to remove the five-year ban in the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996
that prevents states from using federal Temporary Assistance
for Needy Families (TANF) funds to serve legal immigrants in
the U.S. Require that the sponsor's income be deemed in
determining a legal immigrant's eligibility for TANF during the
individual's first three years in the U.S.
Results: Defeated 3 to 6.
Vote by Members: Linder--Nay; Pryce--Nay; Diaz-Balart--Yea;
Hastings (WA)--Nay; Myrick--Nay; Reynolds--Nay; McGovern--Yea;
Hastings (FL)--Yea; Dreier--Nay.
Rules Committee record vote No. 91
Date: May 14, 2002.
Measure: H.R. 4735.
Motion by: Mr. McGovern.
Summary of motion: To make in order the amendment offered
by Mr. George Miller of California, to increase the funding for
the Child Care and Development Block Grant by $11.5 billion
over the next 5 years. Increase the quality set-aside in CCDBG
from 4 percent to 12 percent and create an incentive grant
program for states to increase their provider payment rates.
Expand services to nearly one million more low-income working
families.
Results: Defeated 2 to 7.
Vote by Members: Linder--Nay; Pryce--Nay; Diaz-Balart--Nay;
Hastings (WA)--Nay; Myrick--Nay; Reynolds--Nay; McGovern--Yea;
Hastings (FL)--Yea; Dreier--Nay.
Rules Committee record vote No. 92
Date: May 14, 2002.
Measure: H.R. 4735.
Motion by: Mr. Hastings of Florida.
Summary of motion: To make in order the amendment offered
by Mrs. Clayton, to strike the food stamp program from the
superwaiver and strikes the proposed five state block grant of
the food stamp program.
Results: Defeated 2 to 8.
Vote by Members: Linder--Nay; Pryce--Nay; Diaz-Balart--Nay;
Hastings (WA)--Nay; Myrick--Nay; Sessions--Nay; Reynolds--Nay;
McGovern--Yea; Hastings (FL)--Yea; Dreier--Nay.
Rules Committee record vote No. 93
Date: May 14, 2002.
Measure: H.R. 4735.
Motion by: Mr. Hastings of Florida.
Summary of motion: To make in order the amendment offered
by Mr. Levin, to replace the caseload reduction credit with an
enhanced employment credit which measures state progress in
moving people from welfare to work. States would receive
partial credit for helping TANF recipients obtain part time
work, full credit for helping them obtain full time work, and
extra credit for helping them obtain higher paying jobs that
can help eliminate the possibility they will need TANF
assistance in the future.
Results: Defeated to 2 to 8.
Vote by Members: Linder--Nay; Pryce--Nay; Diaz-Balart--Nay;
Hastings (WA)--Nay; Myrick--Nay; Sessions--Nay; Reynolds--Nay;
McGovern--Yea; Hastings (FL)--Yea; Dreier--Nay.
SUMMARY OF THE AMENDMENT MADE IN ORDER
Cardin--Democratic Substitute. Expands state flexibility to
provide training and education to welfare recipients (such
activities would count for up to 24 months against a state's
participation requirement). Increases to 70 percent the number
of welfare recipients that are required to be engaged in work-
related activities. Provides states with an employment credit
that would reduce a state's participation requirement according
to the number of welfare recipients that have left welfare for
work over the last six months. Maintain the current-law
requirement on total participation hours (30 per week with a
State option to go higher) with a requirement that 24 hours be
in certain activities. Maintain the current 20-hour requirement
for mothers with young children. Maintains the current five-
year time limit on TANF benefits. Increases mandatory funding
for child care by $11 billion over the next five years and
increase TANF for inflation. Removes various barriers to
serving legal immigrants, including the current ban on states
providing Federally-funded TANF benefits to immigrant families.
Includes reducing poverty and increasing self-sufficiency as a
new purpose of the TANF program and provide financial bonuses
to states reducing child poverty.
TEXT OF THE AMENDMENT MADE IN ORDER
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Next Step in Reforming Welfare
Act''.
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. Amendment of Social Security Act.
TITLE I--CONTINUATION OF CERTAIN GRANTS
Sec. 101. Family assistance grants.
Sec. 102. Bonus to reward high performance States.
Sec. 103. Extension of supplemental grants.
Sec. 104. Additional grants for States with low Federal funding per poor
child.
Sec. 105. Contingency Fund.
Sec. 106. Eligibility of Puerto Rico, the United States Virgin Islands,
and Guam for the supplemental grant for population increases,
the Contingency Fund, and mandatory child care funding.
Sec. 107. Direct funding and administration by Indian tribes.
TITLE II--POVERTY REDUCTION
Sec. 201. Additional purpose of TANF program.
Sec. 202. Child poverty reduction grants.
Sec. 203. Review and conciliation process.
Sec. 204. Replacement of caseload reduction credit with employment
credit.
Sec. 205. States to receive partial credit toward work participation
rate for recipients engaged in part-time work.
Sec. 206. TANF recipients who qualify for supplemental security income
benefits removed from work participation rate calculation for
entire year.
Sec. 207. State option to include recipients of substantial child care
or transportation assistance in work participation rate.
Sec. 208. Effective date.
TITLE III--REQUIRING AND REWARDING WORK
Sec. 301. Effect of wage subsidies on 5-year limit.
Sec. 302. Child care.
Sec. 303. Competitive grants to improve access to various benefit
programs.
Sec. 304. Assessments for TANF recipients.
Sec. 305. Applicability of workplace laws.
Sec. 306. Work participation requirements.
Sec. 307. Hours of work-related activities.
Sec. 308. State option to require receipients to engage in work for 40
hours per week.
Sec. 309. Revision and simplification of the transitional medical
assistance program (tma).
Sec. 310. Ensuring TANF funds are not used to displace public employees.
TITLE IV--HELPING WELFARE LEAVERS CLIMB THE EMPLOYMENT LADDER
Sec. 401. State plan requirement on employment advancement.
Sec. 402. Employment Advancement Fund.
Sec. 403. Elimination of limit on number of TANF recipients enrolled in
vocational education or high school who may be counted towards
the work participation requirement.
Sec. 404. Counting of up to 2 years of vocational or educational
training (including postsecondary education), work-study, and
related internships as work activities.
Sec. 405. Limited counting of certain activities leading to employment
as work activity.
Sec. 406. Clarification of authority of States to use TANF funds carried
over from prior years to provide TANF benefits and services.
Sec. 407. Definition of assistance.
TITLE V--PROMOTING FAMILY FORMATION AND RESPONSIBLE PARENTING
Sec. 501. Family Formation Fund.
Sec. 502. Distribution of child support collected by States on behalf of
children receiving certain welfare benefits.
Sec. 503. Elimination of separate work participation rate for 2-parent
families.
Sec. 504. Ban on imposition of stricter eligibility criteria for 2-
parent families; State opt-out.
Sec. 505. Extension of abstinence education funding under maternal and
child health program.
TITLE VI--RESTORING FAIRNESS FOR IMMIGRANT FAMILIES
Sec. 601. Treatment of aliens under the TANF program.
Sec. 602. Optional coverage of legal immigrants under the medicaid
program and SCHIP.
Sec. 603. Eligibility of disabled children who are qualified aliens for
SSI.
TITLE VII--ENSURING STATE ACCOUNTABILITY
Sec. 701. Inflation adjustment of maintenance-of-effort requirement.
Sec. 702. Ban on using Federal TANF funds to replace State and local
spending that does not meet the definition of qualified State
expenditures.
TITLE VIII--IMPROVING INFORMATION ABOUT TANF RECIPIENTS AND PROGRAMS
Sec. 801. Extension of funding of studies and demonstrations.
Sec. 802. Longitudinal studies of employment and earnings of TANF
leavers.
Sec. 803. Inclusion of disability status in information States report
about TANF families.
Sec. 804. Annual report to the Congress to include greater detail about
State programs funded under TANF.
Sec. 805. Enhancement of understanding of the reasons individuals leave
State TANF programs.
Sec. 806. Standardized State plans.
Sec. 807. Study by the Census Bureau.
Sec. 808. Access to welfare; welfare outcomes.
TITLE IX--EFFECTIVE DATE
Sec. 901. Effective date.
SEC. 3. AMENDMENT OF SOCIAL SECURITY ACT.
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.
TITLE I--CONTINUATION OF CERTAIN GRANTS
SEC. 101. FAMILY ASSISTANCE GRANTS.
(a) In General.--Section 403(a)(1)(A) (42 U.S.C.
603(a)(1)(A)) is amended by striking ``1996'' and all that
follows through ``2002'' and inserting ``2003 through 2007''.
(b) Inflation Adjustment.--Section 403(a)(1) (42 U.S.C.
603(a)(1)) is amended--
(1) in subparagraph (B)--
(A) by striking ``means the greatest of--''
and inserting ``means, with respect to a fiscal
year specified in subparagraph (A) of this
paragraph--
``(i) the greatest of--'';
(B) by redesignating each of clauses (i),
(ii)(I), (ii)(II), and (iii) as subclauses (I),
(II)(aa), (II)(bb), and (III), respectively;
(C) by indenting each of the provisions
specified in subparagraph (B) of this paragraph
2 additional ems to the right;
(D) by striking the period and inserting ``;
multiplied by''; and
(E) by adding at the end the following:
``(ii) 1.00, plus the inflation
percentage (as defined in subparagraph
(F) of this paragraph) in effect for
the fiscal year specified in
subparagraph (A) of this paragraph.'';
and
(2) by adding at the end the following:
``(F) Inflation percentage.--For purposes of
subparagraph (B) of this paragraph, the
inflation percentage applicable to a fiscal
year is the percentage (if any) by which--
``(i) the average of the Consumer
Price Index (as defined in section
1(f)(5) of the Internal Revenue Code of
1986) for the 12-month period ending on
September 30 of the immediately
preceding fiscal year; exceeds
``(ii) the average of the Consumer
Price Index (as so defined) for the 12-
month period ending on September 30,
2001.''.
SEC. 102. BONUS TO REWARD HIGH PERFORMANCE STATES.
Section 403(a)(4) (42 U.S.C. 603(a)(4)) is amended--
(1) in subparagraph (D), by striking
``$1,000,000,000'' and inserting ``$1,800,000,000'';
(2) in subparagraph (E), by striking ``and 2003'' and
inserting ``2003, 2004, 2005, 2006, and 2007''; and
(3) in subparagraph (F), by striking ``2003
$1,000,000,000'' and inserting ``2002 $800,000,000, and
for fiscal years 2003 through 2007 $1,000,000,000,''.
SEC. 103. EXTENSION OF SUPPLEMENTAL GRANTS.
Section 403(a)(3) (42 U.S.C. 603(a)(3)) is amended--
(1) in subparagraph (A)--
(A) by striking ``and'' at the end of clause
(i);
(B) by striking the period at the end of
clause (ii) and inserting ``; and''; and
(C) by adding at the end the following:
``(iii) for each of fiscal years 2003
through 2007, a grant in an amount
equal to the amount required to be paid
to the State under this paragraph in
fiscal year 2001.'';
(2) in subparagraph (E), by striking ``1998'' and all
that follows and inserting ``2003 through 2007
$1,597,250,000 for grants under this paragraph.''; and
(3) by striking subparagraph (G).
SEC. 104. ADDITIONAL GRANTS FOR STATES WITH LOW FEDERAL FUNDING PER
POOR CHILD.
Section 403(a) (42 U.S.C. 603(a)) is amended by adding at the
end the following:
``(6) Additional grants for states with low federal funding
per poor child.--
``(A) In general.--The Secretary shall make a
grant pursuant to this paragraph to a State--
``(i) for fiscal year 2003, if the
State is an inadequately poverty-funded
State for fiscal year 2002; and
``(ii) for any of fiscal years 2004
through 2007, if the State is an
inadequately poverty-funded State for
any prior fiscal year after fiscal year
2002.
``(B) Inadequately poverty-funded state.--For
purposes of this paragraph, a State is an
inadequately poverty-funded State for a
particular fiscal year if--
``(i) the total amount of the grants
made to the State under paragraph (1),
paragraph (3), and this paragraph for
the particular fiscal year, divided by
the number of children in poverty in
the State with respect to the
particular fiscal year is less than 75
percent of the total amount of grants
made to all eligible States under
paragraph (1), paragraph (3), and this
paragraph for the particular fiscal
year, divided by the total number of
children living in poverty in all
eligible States with respect to the
particular fiscal year; and
``(ii) the total of the amounts paid
to the State under this subsection for
all prior fiscal years that have not
been expended by the State by the end
of the preceding fiscal year is less
than 50 percent of State family
assistance grant for the particular
fiscal year.
``(C) Amount of grant.--The amount of the
grant to be made under this paragraph to a
State for a particular fiscal year shall be--
``(i) if the particular fiscal year
is fiscal year 2003, an amount equal
to--
``(I) the number of children
in poverty in the State for the
then preceding fiscal year,
divided by the total number of
children in poverty in all
States that are inadequately
poverty-funded States for the
then preceding fiscal year;
multiplied by
``(II) the amount
appropriated pursuant to
subparagraph (G) for the
particular fiscal year; or
``(ii) if the particular fiscal year
is any of fiscal years 2004 through
2007, an amount equal to--
``(I) the amount required to
be paid to the State under this
paragraph for the then
preceding fiscal year; plus
``(II) if the State is an
inadequately poverty-funded
State for the then preceding
fiscal year--
``(aa) the number of
children in poverty in
the State for the then
preceding fiscal year,
divided by the total
number of children in
poverty in all States
that are inadequately
poverty-funded States
for the then preceding
fiscal year; multiplied
by
``(bb) the amount
appropriated pursuant
to subparagraph (G) for
the particular fiscal
year.
``(D) Use of grant.--A State to which a grant
is made under this paragraph shall use the
grant for any purpose for which a grant made
under this part may be used.
``(E) Definitions.--In this paragraph:
``(i) Children in poverty.--The term
`children in poverty' means, with
respect to a State and a fiscal year,
the number of children residing in the
State who had not attained 18 years of
age and whose family income was less
than the poverty line then applicable
to the family, as of the end of the
fiscal year.
``(ii) Poverty line.--The term
`poverty line' has the meaning given
the term in section 673(2) of the
Omnibus Budget Reconciliation Act of
1981, including any revision required
by such section.
``(F) Family income determinations.--For
purposes of this paragraph, family income
includes cash income, except cash benefits from
means-tested public programs and child support
payments.
``(G) 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--
``(I) $65,000,000 for fiscal
year 2003;
``(II) $130,000,000 for
fiscal year 2004;
``(III) $195,000,000 for
fiscal year 2005;
``(IV) $260,000,000 for
fiscal year 2006; and
``(V) $325,000,000 for fiscal
year 2007.
``(ii) Availability.--Amounts made
available under clause (i) shall remain
available until expended.''.
SEC. 105. CONTINGENCY FUND.
(a) In General.--Section 403(b) (42 U.S.C. 603(b)) is
amended--
(1) in paragraph (2), by striking ``1997'' and all
that follows and inserting ``2003 through 2007 such
sums as are necessary for payments under this
subsection''; and
(2) in paragraph (3), by striking subparagraph (C)
and inserting the following:
``(C) Limitation on monthly payment to a
state.--The total amount paid to a single State
under subparagraph (A) during a fiscal year
shall not exceed 20 percent of the State family
assistance grant.''.
(b) Application of Regular Maintenance of Effort
Requirement.--Section 409(a)(10) (42 U.S.C. 609(a)(10)) is
amended by striking ``100 percent of historic State
expenditures (as defined in paragraph (7)(B)(iii) of this
subsection)'' and inserting ``the applicable percentage (as
defined in paragraph (7)(B)(ii) of this subsection) of
inflation-adjusted historic State expenditures (as defined in
paragraph (7)(B)(vi) of this subsection)''.
(c) Modification of Unemployment Test To Become Needy
State.--Section 403(b)(5)(A) (42 U.S.C. 603(b)(5)(A)) is
amended to read as follows:
``(A) the average rate of total unemployment
in the State (seasonally adjusted) 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 the preceding fiscal year; or''.
(d) Modification of Food Stamp Test To Become Needy State.--
Section 403(b)(5)(B) (42 U.S.C. 603(b)(5)(B)) is amended to
read as follows:
``(B) 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 the preceding
fiscal year.''.
(e) Simplification of Reconciliation Formula.--Section
403(b)(6) (42 U.S.C. 603(b)(6)) is amended to read as follows:
``(6) Annual reconciliation.--
``(A) In general.--Notwithstanding paragraph
(3), if the Secretary makes a payment to a
State under this subsection in a fiscal year,
then the State shall remit to the Secretary,
within 1 year after the end of the first
subsequent period of 3 consecutive months for
which the State is not a needy State, an amount
equal to the amount (if any) by which--
``(i) the maintenance of effort level
(as defined in subparagraph (B)(i) of
this paragraph) for the fiscal year,
plus the State contribution (as defined
in subparagraph (B)(ii) of this
paragraph) in the fiscal year; exceeds
``(ii) the qualified State
expenditures (as defined in section
409(a)(7)(B)(i)) in the fiscal year.
``(B) Definitions.--In subparagraph (A):
``(i) Maintenance of effort level.--
The term ``maintenance of effort
level'' means, with respect to a State
and a fiscal year, an amount equal to
the applicable percentage of historic
State expenditures (as defined in
section 409(a)(7)(B)) for the fiscal
year.
``(ii) State contribution.--The term
`State contribution' means, with
respect to a fiscal year--
``(I) the total amount paid
to the State under this
subsection in the fiscal year;
multiplied by
``(II) 1 minus the greater of
75 percent or the Federal
medical assistance percentage
for the State (as defined in
section 1905(b)), divided by
the greater of 75 percent or
the Federal medical assistance
percentage for the State (as
defined in section 1905(b)).''.
(f) Increase in Number of Months for Which State May Qualify
for Payments.--Section 403(b)(4) (42 U.S.C. 603(b)(4)) is
amended by striking ``2-month'' and inserting ``3-month''.
SEC. 106. ELIGIBILITY OF PUERTO RICO, THE UNITED STATES VIRGIN ISLANDS,
AND GUAM FOR THE SUPPLEMENTAL GRANT FOR POPULATION
INCREASES, THE CONTINGENCY FUND, AND MANDATORY
CHILD CARE FUNDING.
(a) Supplemental grant for population increases.--
(1) In general.--Section 403(a)(3)(D)(iii) (42 U.S.C.
603(a)(3)(D)(iii)) is amended by striking ``and the
District of Columbia.'' and inserting ``, the District
of Columbia, Puerto Rico, the United States Virgin
Islands, and Guam. For fiscal years beginning after the
effective date of this sentence, this paragraph shall
be applied and administered as if the term `State'
included the Commonwealth of Puerto Rico, the United
States Virgin Islands, and Guam for fiscal year 1998
and thereafter.''.
(2) Grant payment disregarded for purposes of section
1108 limitation.--Section 1108(a)(2) (42 U.S.C.
1308(a)(2)) is amended by inserting ``, or any payment
made to the Commonwealth of Puerto Rico, the United
States Virgin Islands, or Guam under section
403(a)(3)'' before the period.
(b) Contingency Fund.--
(1) In general.--Section 403(b)(7) (42 U.S.C.
603(b)(7)) is amended by striking ``and the District of
Columbia'' and inserting ``, the District of Columbia,
the Commonwealth of Puerto Rico, the United States
Virgin Islands, and Guam.''.
(2) Grant payment disregarded for purposes of section
1108 limitation.--Section 1108(a)(2) (42 U.S.C.
1308(a)(2)), as amended by subsection (a)(2) of this
section, is amended by inserting ``or 403(b)'' after
``403(a)(3)'' before the period.
(c) Child Care Entitlement Funds.--
(1) In general.--Section 418(d) (42 U.S.C. 618(d)) is
amended by striking ``and the District of Columbia''
and inserting ``, the District of Columbia, the
Commonwealth of Puerto Rico, the United States Virgin
Islands, and Guam''.
(2) Amount of payment.--
(A) General entitlement.--Section 418(a)(1)
(42 U.S.C. 618(a)(1)) is amended by striking
``the greater of--'' and all that follows and
inserting the following:
``(A) in the case of the Commonwealth of
Puerto Rico, the United States Virgin Islands,
and Guam, 60 percent of the amount required to
be paid to the State for fiscal year 2001 under
the Child Care and Development Block Grant Act
of 1990; or
``(B) in the case of any other State, the
greater of--
``(i) the total amount required to be
paid to the State under section 403 for
fiscal year 1994 or 1995 (whichever is
greater) with respect to expenditures
for child care under subsections (g)
and (i) of section 402 (as in effect
before October 1, 1995); or
``(ii) the average of the total
amounts required to be paid to the
State for fiscal years 1992 through
1994 under the subsections referred to
in clause (i).'';
(B) Allotment of remainder.--Section
418(a)(2)(B) (42 U.S.C. 618(a)(2)(B)) is
amended to read as follows:
``(B) Allotments to states.--Of the total
amount available for payments to States under
this paragraph, as determined under
subparagraph (A) of this paragraph--
``(i) an amount equal to 65 percent
of the amount required to be paid to
each of the Commonwealth of Puerto
Rico, the United States Virgin Islands,
and Guam for fiscal year 2001 under the
Child Care and Development Block Grant
Act of 1990, shall be allotted to the
Commonwealth of Puerto Rico, the United
States Virgin Islands, and Guam,
respectively; and
``(ii) the remainder shall be
allotted among the other States based
on the formula used for determining the
amount of Federal payments to each
State under section 403(n) of this Act
(as in effect before October 1,
1995).''.
(3) Grant payment disregarded for purposes of section
1108 limitation.--Section 1108(a)(2) (42 U.S.C.
1308(a)(2)), as amended by subsections (a)(2) and
(b)(2) of this section, is amended by striking ``or
403(b)'' and inserting ``, 403(b), or 418''.
(d) Effective Date.--The amendments made by this section
shall take effect on October 1, 2002, and shall apply to
expenditures for fiscal years beginning with fiscal year 2003.
SEC. 107. DIRECT FUNDING AND ADMINISTRATION BY INDIAN TRIBES.
(a) Tribal Family Assistance Grant.--Section 412(a)(1) (42
U.S.C. 612(a)(1)) is amended by striking ``1997, 1998, 1999,
2000, and 2001'' and inserting ``2003 through 2007''.
(b) Grants for Indian Tribes That Received JOBS Funds.--
Section 412(a)(2) (42 U.S.C. 612(a)(2)) is amended by striking
``1997, 1998, 1999, 2000, and 2001'' and inserting ``2003
through 2007''.
TITLE II--POVERTY REDUCTION
SEC. 201. ADDITIONAL PURPOSE OF TANF PROGRAM.
Section 401(a) (42 U.S.C. 601(a)) is amended--
(1) by striking ``and'' at the end of paragraph (3);
(2) by striking the period at the end of paragraph
(4) and inserting ``; and''; and
(3) by adding at the end the following:
``(5) reduce the extent and severity of poverty and
promote self-sufficiency among families with
children.''.
SEC. 202. CHILD POVERTY REDUCTION GRANTS.
Section 403(a) (42 U.S.C. 603(a)) is further amended by
adding at the end the following:
``(7) Bonus to reward states that reduce child
poverty.--
``(A) In general.--Beginning with fiscal year
2003, the Secretary shall make a grant pursuant
to this paragraph to each State for each fiscal
year for which the State is a qualified child
poverty reduction State.
``(B) Amount of grant.--
``(i) In general.--Subject to this
subparagraph, the amount of the grant
to be made to a qualified child poverty
reduction State for a fiscal year shall
be an amount equal to--
``(I) the number of children
who had not attained 18 years
of age by the end of the then
most recently completed
calendar year and who resided
in the State as of the end of
such calendar year, divided by
the number of such children who
resided in the United States as
of the end of such calendar
year; multiplied by
``(II) the amount
appropriated pursuant to
subparagraph (F) for the fiscal
year.
``(ii) Limitations.--
``(I) Minimum grant.--The
amount of the grant to be made
to a qualified child poverty
reduction State for a fiscal
year shall be not less than
$1,000,000.
``(II) Maximum grant.--The
amount of the grant to be made
to a qualified child poverty
reduction State for a fiscal
year shall not exceed an amount
equal to 5 percent of the State
family assistance grant for the
fiscal year.
``(iii) Pro rata increase.--If the
amount available for grants under this
paragraph for a fiscal year is greater
than the total amount of payments
otherwise required to be made under
this paragraph for the fiscal year,
then the amount otherwise payable to
any State for the fiscal year under
this paragraph shall, subject to clause
(ii)(II), be increased by such equal
percentage as may be necessary to
ensure that the total of the amounts
payable for the fiscal year under this
paragraph equals the amount available
for the grants.
``(iv) Pro rata reduction.--If the
amount available for grants under this
paragraph for a fiscal year is less
than the total amount of payments
otherwise required to be made under
this paragraph for the fiscal year,
then the amount otherwise payable to
any State for the fiscal year under
this paragraph shall, subject to clause
(ii)(I), be reduced by such equal
percentage as may be necessary to
ensure that the total of the amounts
payable for the fiscal year under this
paragraph equals the amount available
for the grants.
``(C) Use of grant.--A State to which a grant
is made under this paragraph shall use the
grant for any purpose for which a grant made
under this part may be used.
``(D) Definitions.--In this paragraph:
``(i) Qualified child poverty
reduction state.--The term `qualified
child poverty reduction State' means,
with respect to a fiscal year, a State
if--
``(I) the child poverty rate
achieved by the State for the
then most recently completed
calendar year for which such
information is available is
less than the lowest child
poverty rate achieved by the
State during the applicable
period; and
``(II) the average depth of
child poverty in the State for
the then most recently
completed calendar year for
which such information is
available is not greater than
the average depth of child
poverty in the State for the
calendar year that precedes
such then most recently
completed calendar year.
``(ii) Applicable period.--In clause
(i), the term `applicable period'
means, with respect to a State and the
calendar year referred to in clause
(i)(I), the period that--
``(I) begins with the
calendar year that, as of
October 1, 2002, precedes the
then most recently completed
calendar year for which such
information is available; and
``(II) ends with the calendar
year that precedes the calendar
year referred to clause (i)(I).
``(iii) Child poverty rate.--The term
`child poverty rate' means, with
respect to a State and a calendar year,
the percentage of children residing in
the State during the calendar year
whose family income for the calendar
year is less than the poverty line then
applicable to the family.
``(iv) Average depth of child
poverty.--The term `average depth of
child poverty' means with respect to a
State and a calendar year, the average
dollar amount by which family income is
exceeded by the poverty line, among
children in the State whose family
income for the calendar year is less
than the applicable poverty line.
``(v) Poverty line.--The term
`poverty line' has the meaning given
the term 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.
``(E) Family income determinations.--For
purposes of this paragraph, family income
includes cash income, child support payments,
government cash payments, and benefits under
the Food Stamp Act of 1977 that are received by
any family member, and family income shall be
determined after payment of all taxes and
receipt of any tax refund or rebate by any
family member.
``(F) Appropriations.--
``(i) In general.--Out of any money
in the Treasury of the United States
not otherwise appropriated, there are
appropriated for each of fiscal years
2003 through 2007 $150,000,000 for
grants under this paragraph.
``(ii) Availability.--Amounts made
available under clause (i) shall remain
available until expended.''.
SEC. 203. REVIEW AND CONCILIATION PROCESS.
(a) Requirement.--Section 408(a) (42 U.S.C. 608(a)) is
amended by adding at the end the following:
``(12) Review and conciliation process
requirements.--A State to which a grant is made under
section 403 shall not impose a sanction against a
person under the State program funded under this part,
unless the State--
``(A) has attempted at least twice (using at
least 2 different methods) to notify the person
of the impending imposition of the sanction,
the reason for the proposed sanction, the
amount of the sanction, the length of time
during which the proposed sanction would be in
effect, and the steps required to come into
compliance or to show good cause for
noncompliance;
``(B) has afforded the person an
opportunity--
``(i) to meet with the caseworker
involved or another individual who has
authority to determine whether to
impose the sanction; and
``(ii) to explain why the person did
not comply with the requirement on the
basis of which the sanction is to be
imposed;
``(C) has considered and taken any such
explanation into account in determining to
impose the sanction;
``(D) has specifically considered whether
certain conditions exist, such as a physical or
mental impairment, domestic violence, or
limited proficiency in English, that
contributed to the noncompliance of the person;
and
``(E) in determining whether to impose the
sanction, has used screening tools developed in
consultation with individuals or groups with
expertise in matters described in subparagraph
(D).''.
(b) Penalty.--Section 409(a) (42 U.S.C. 609(a)) is amended by
adding at the end the following:
``(15) Penalty for failure of state to use review and
conciliation process.--
``(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.''.
SEC. 204. 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(a) (42 U.S.C. 607(a)),
as amended by section 503 of this Act, is amended by
adding at the end the following:
``(2) Employment credit.--
``(A) In general.--The minimum participation
rate otherwise applicable to a State under this
subsection for a fiscal year shall be reduced
by the number of percentage points in the
employment credit for the State for the fiscal
year, as determined by the Secretary--
``(i) using information in the
National Directory of New Hires, or
``(ii) with respect to a recipient of
assistance under the State program
funded under this part who is placed
with an employer whose hiring
information is not reported to the
National Directory of New Hires, using
quarterly wage information submitted by
the State to the Secretary not later
than such date as the Secretary shall
prescribe in regulations.
``(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
that ceased to receive cash
payments under the State
program funded under this part
during the most recent 4
quarters for which data is
available and that were
employed during the calendar
quarter immediately succeeding
the quarter in which the
payments ceased, plus, at State
option, the number of families
that received a non-recurring
short-term benefit under the
State program funded under this
part during the preceding
fiscal year and that were
employed in during the calendar
quarter immediately succeeding
the quarter in which the non-
recurring short-term benefit
was so received; 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, plus, if the State
elected the option under
subclause (I), the number of
families that received a non-
recurring short-term benefit
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,
during the preceding fiscal year,
earned at least 33 percent of the
average wage in the State (determined
on the basis of State unemployment
data) shall be considered to be 1.5
families.
``(C) Publication of amount of credit.--Not
later than August 30 of each fiscal year, the
Secretary shall cause to be published in the
Federal Register the amount of the employment
credit that will be used in determining the
minimum participation rate applicable to a
State under this subsection for the immediately
succeeding fiscal year.''.
(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(a)(2).''.
(b) Elimination of Caseload Reduction Credit.--Section 407(b)
(42 U.S.C. 607(b)) is amended by striking paragraph (3) and
redesignating paragraphs (4) and (5) as paragraphs (3) and (4),
respectively.
SEC. 205. STATES TO RECEIVE PARTIAL CREDIT TOWARD WORK PARTICIPATION
RATE FOR RECIPIENTS ENGAGED IN PART-TIME WORK.
Section 407(c)(1)(A) (42 U.S.C. 607(c)(1)(A)), as amended by
section 307 of this Act, 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 30 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.''.
SEC. 206. 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.
SEC. 207. STATE OPTION TO INCLUDE RECIPIENTS OF SUBSTANTIAL CHILD CARE
OR TRANSPORTATION ASSISTANCE IN WORK PARTICIPATION
RATE.
(a) In General.--Section 407(a)(1) (42 U.S.C. 607(a)), as
amended by sections 503 and 306 of this Act, is amended by
inserting ``(including, at the option of the State, a family
that includes an adult who is receiving substantial child care
or transportation benefits, as defined by the Secretary, in
consultation with directors of State programs funded under this
part, which definition shall specify for each type of benefits
a threshold which is a dollar value or a length of time over
which the benefits are received, and take account of large one-
time transition payments, except any family taken into account
under paragraph (2)(B)(i)(I))'' before the colon.
(b) State Option.--Section 407(b)(1)(B)(i) (42 U.S.C.
607(b)(1)(B)(i)) is amended--
(1) in clause (i), by inserting ``plus, at the option
of the State, the number of families that include an
adult who is receiving substantial child care or
transportation benefits, as determined under section
407(a)(1)'' before the semicolon.
(2) in subclause (ii)(I), by inserting ``including,
if the State has elected to include families with an
adult who is receiving substantial child care or
transportation benefits under clause (i), the number of
such families'' before the semicolon.
(c) Data Collection and Reporting.--Section 411(a)(1)(A) of
such Act (42 U.S.C. 611(a)(1)(A)) is amended in the matter
preceding clause (i) by inserting ``(including any family with
respect to whom the State has exercised its option under
section 407(a)(1))'' after ``assistance''.
SEC. 208. EFFECTIVE DATE.
(a) In General.--Except as provided in subsection (b), the
amendments made by sections 204 through 207 shall take effect
on October 1, 2003.
(b) State Option To Phase-in Replacement of Caseload
Reduction Credit With Employment Credit and Delay Applicability
of Other Provisions.--A State may elect to have the amendments
made by sections 204(b) and 205 through 207 of this Act not
apply to the State program funded under part A of title IV of
the Social Security Act until October 1, 2004, and if the State
makes the election, then, in determining the participation rate
of the State for purposes of sections 407 and 409(a)(3) of the
Social Security Act for fiscal year 2004, the State shall be
credited with \1/2\ of the reduction in the rate that would
otherwise result from applying section 407(a)(2) of the Social
Security Act (as added by section 204(a)(1) of this Act) to the
State for fiscal year 2004 and \1/2\ of the reduction in the
rate that would otherwise result from applying such section
407(b)(2) to the State for fiscal year 2004.
TITLE III--REQUIRING AND REWARDING WORK
SEC. 301. EFFECT OF WAGE SUBSIDIES ON 5-YEAR LIMIT.
Section 408(a)(7) (42 U.S.C. 608(a)(7)) is amended by adding
at the end the following:
``(H) Limitation on meaning of `assistance'
for families with income from employment.--For
purposes of this paragraph, at the option of
the State, a benefit or service provided to a
family during a month under the State program
funded under this part shall not be considered
assistance under the program if--
``(i) during the month, the family
includes an adult or a minor child head
of household who has received at least
such amount of income from employment
as the State may establish; and
``(ii) the average weekly earned
income of the family for the month is
at least $100.''.
SEC. 302. CHILD CARE.
(a) Increase in Entitlement Funding.--Section 418(a)(3) (42
U.S.C. 618(a)(3)) is amended--
(1) by striking ``and'' at the end of subparagraph
(E);
(2) by striking the period at the end of subparagraph
(F) and inserting a semicolon; and
(3) by adding at the end the following:
``(G) $3,967,000,000 for fiscal year 2003;
``(H) $4,467,000,000 for fiscal year 2004;
``(I) $4,967,000,000 for fiscal year 2005;
``(J) $5,467,000,000 for fiscal year 2006;
and
``(K) $5,967,000,000 for fiscal year 2007.''.
(b) Amendments to the Child Care and Development Block Grant
Act of 1990.--
(1) Authorization of appropriations.--Section 658B of
the Child Care and Development Block Grant Act of 1990
(42 U.S.C. 9858) is amended to read as follows:
``SEC. 658B. AUTHORIZATION OF APPROPRIATIONS; AMOUNTS AVAILABLE FOR
INCENTIVE GRANTS TO IMPROVE QUALITY OF CHILD CARE
SERVICES.
``(a) Authorization of Appropriations.--There are authorized
to be appropriated to carry out this subchapter $2,350,000,000
for fiscal year 2003 and such sums as may be necessary for
fiscal years 2004 through 2007.
``(b) Amounts Available for Incentive Grants To Improve
Quality of Child Care Services.--Of the amount made available
to carry out this subchapter, $500,000,000 shall be used for
each of the fiscal years 2003 through 2007 to make grants under
section 658H.''.
(2) State plan requirements.--Section 658E(c)(2) of
the Child Care and Development Block Grant Act of 1990
(42 U.S.C. 9858c(c)(2)) is amended--
(A) in subparagraph (A)--
(i) in clause (ii) by striking
``and'' at the end;
(ii) in clause (iii) by adding
``and'' at the end; and
(iii) by inserting after clause (iii)
the following:
``(iv) in order to help ensure that
parents have the freedom to choose
quality center-based child care
services, the State shall make
significant effort to develop contracts
with accredited child care providers in
low-income and rural communities;'';
(B) by amending subparagraph (D) to read as
follows:
``(D) Consumer education information.--
Certify that the State will collect and
disseminate to parents of eligible children and
the general public, consumer education
information that will promote informed child
care choices, and describe how the State will
inform parents receiving assistance under a
State program funded under part A of title IV
of the Social Security Act (42 U.S.C. 601 et
seq.) and other low-income parents about
eligibility for assistance under this
subchapter.'';
(C) by amending subparagraph (H) to read as
follows:
``(H) Meeting the needs of certain
populations.--Demonstrate the manner in which
the State will meet the specific child care
needs of families who are receiving assistance
under a State program under part A of title IV
of the Social Security Act, families who are
attempting through work activities to
transition off of such assistance program,
families with children with disabilities and
other special needs, low-income families not
receiving cash assistance under a State program
under part A of title IV of the Social Security
Act, and families that are at risk of becoming
dependent on such assistance.''; and
(D) by adding at the end the following:
``(I) Availability of staff.--Describe how
the State will ensure that staff from the lead
agency described in section 658D will be
available, at the offices of the State program
funded under part A of title IV of the Social
Security Act, to provide information about
eligibility for assistance under this
subchapter and to assist individuals in
applying for such assistance.
``(J) Eligibility redetermination.--
Demonstrate that each child that receives
assistance under this subchapter in the State
will receive such assistance for not less than
1 year before the State redetermines the
eligibility of the child under this subchapter.
``(K) Supplement not supplant.--Provide
assurances that the amounts paid to a State
under this subchapter shall be used to
supplement and not supplant other State or
local funds expended or otherwise available to
support payments for child care assistance and
to increase the quality of available child care
for eligible families under this subchapter.''.
(3) Payment rates.--Section 658E(c)(4)(A) of the
Child Care and Development Block Grant Act of 1990 (42
U.S.C. 9858c(c)(4)(A)) is amended--
(A) by striking ``such access'' and inserting
``equal access to comparable quality and types
of services''; and
(B) by adding at the end the following:
``(i) Market rate surveys (that
reflect variations in the cost of child
care services by locality) shall be
conducted by the State not less often
than at 2-year intervals, and the
results of such surveys shall be used
to implement payment rates that ensure
equal access to comparable services as
required by this subparagraph.
``(ii) Payment rates shall be
adjusted at intervals between such
surveys to reflect increases in the
cost of living, in such manner as the
Secretary may specify.
``(iii) Payment rates shall reflect
variations in the cost of providing
child care services for children of
different ages and providing different
types of care.''.
(4) Child care accountability improvements.--Section
658G of the Child Care and Development Block Grant Act
of 1990 (42 U.S.C. 9858e) is amended to read as
follows:
``SEC. 658G. CHILD CARE ACCOUNTABILITY IMPROVEMENTS.
``(a) Activities To Improve the Quality of Child Care.--A
State that receives funds to carry out this subchapter shall
reserve and use not less than 12 percent of the funds for
improvements in the quality of child care services provided in
the State and in political subdivisions of the State.
``(1) Not less than 35 percent of the funds reserved
under this subsection shall be used for activities that
are designed to increase the quality and supply of
child care services for children from birth through 3
years of age.
``(2) Funds reserved under this subsection shall be
used for 1 or more activities consisting of--
``(A) providing for the development,
establishment, expansion, operation, and
coordination of, child care resource and
referral services;
``(B) making grants or providing loans to
eligible child care providers to assist the
providers in meeting applicable State and local
child care standards and recognized
accreditation standards;
``(C) improving the ability of State or local
government, as applicable, to monitor
compliance with, and to enforce, State and
local licensing and regulatory requirements
(including registration requirements)
applicable to child care providers;
``(D) providing training and technical
assistance in areas relating to the provision
of child care services, such as training
relating to promotion of health and safety,
promotion of good nutrition, provision of first
aid, recognition of communicable diseases,
child abuse detection and prevention, and care
of children with disabilities and other special
needs;
``(E) improving salaries and other
compensation paid to full-time and part-time
staff who provide child care services for which
assistance is made available under this
subchapter;
``(F) making grants or providing financial
assistance to eligible child care providers for
training in child development and early
education;
``(G) making grants or providing financial
assistance to eligible child care providers to
support delivery of early education and child
development activities;
``(H) making grants or providing financial
assistance to eligible child care providers to
make minor renovations to such providers'
physical environments that enhance the quality
of the child care services they provide;
``(I) improving and expanding the supply of
child care services for children with
disabilities and other special needs;
``(J) increasing the supply of high quality
inclusive child care for children with and
without disabilities and other special needs;
``(K) supporting the system described in
paragraph (2);
``(L) providing technical assistance to
family child care providers and center-based
child care providers to enable them to provide
appropriate child care services for children
with disabilities; and
``(M) other activities that can be
demonstrated to increase the quality of child
care services and parental choice.''.
``(b) Child Care Resource and Referral System.--The State
shall use a portion of the funds reserved under subsection (a)
to support a system of local child care resource and referral
organizations coordinated by a statewide, nonprofit, community-
based child care resource and referral organization. The local
child care resource and referral system shall--
``(1) provide parents in the State with information
and support concerning child care options in their
communities;
``(2) collect and analyze data on the supply of and
demand for child care in political subdivisions within
the State;
``(3) develop links with the business community or
other organizations involved in providing child care
services;
``(4) increase the supply and improve the quality of
child care in the State and in political subdivisions
in the State;
``(5) provide (or facilitate the provision of)
specialists in health, mental health consultation,
early literacy services for children with disabilities
and other special needs, and infant and toddler care,
to support or supplement community child care
providers;
``(6) provide training or facilitate connections for
training to community child care providers; or
``(7) hire disability specialists, and provide
training and technical assistance to child care
providers, to effectively meet the needs of children
with disabilities.
(5) Incentive grants to states.--The Child Care and
Development Block Grant Act of 1990 (42 U.S.C. 9858 et
seq.) is amended by inserting after section 658G the
following:
``SEC. 658H. INCENTIVE GRANTS TO STATES.
``(a) Authority.--
``(1) In general.--The Secretary shall use the amount
made available under section 658B(b) for a fiscal year
to make grants to eligible States in accordance with
this section.
``(2) Annual payments.--The Secretary shall make an
annual payment for such a grant to each eligible State
out of the allotment for that State determined under
subsection (c).
``(b) Eligible States.--
``(1) In general.--In this section, the term
`eligible State' means a State that--
``(A) has conducted a survey of the market
rates for child care services in the State
within the 2 years preceding the date of the
submission of an application under paragraph
(2); and
``(B) submits an application in accordance
with paragraph (2).
``(2) Application.--
``(A) In general.--To be eligible to receive
a grant under this section, a State shall
submit an application to the Secretary at such
time, in such manner, and accompanied by such
information, in addition to the information
required under subparagraph (B), as the
Secretary may require.
``(B) Information required.--Each application
submitted for a grant under this section
shall--
``(i) detail the methodology and
results of the State market rates
survey conducted pursuant to paragraph
(1)(A);
``(ii) describe the State's plan to
increase payment rates from the initial
baseline determined under clause (i);
``(iii) describe how the State will
increase payment rates in accordance
with the market survey results, for all
types of child care providers who
provide services for which assistance
is made available under this
subchapter;
``(iv) describe how rates are set to
reflect the variations in the cost of
providing care for children of
different ages, different types of
care, and in different localities in
the State; and
``(v) describe how the State will
prioritize increasing payment rates for
care of higher-than-average quality,
such as care by accredited providers,
care that includes the provision of
comprehensive services, care provided
at nonstandard hours, care for children
with disabilities and other special
needs, care in low-income and rural
communities, and care of a type that is
in short supply.
``(3) Continuing eligibility requirement.--The
Secretary may make an annual payment under this section
to an eligible State only if--
``(A) the Secretary determines that the State
has made progress, through the activities
assisted under this subchapter, in maintaining
increased payment rates; and
``(B) at least once every 2 years, the State
conducts an update of the survey described in
paragraph (1)(A).
``(4) Requirement of matching funds.--
``(A) In general.--To be eligible to receive
a grant under this section, the State shall
agree to make available State contributions
from State sources toward the costs of the
activities to be carried out by a State
pursuant to subsection (d) in an amount that is
not less than 20 percent of such costs.
``(B) Determination of state contributions.--
State contributions shall be in cash. Amounts
provided by the Federal Government may not be
included in determining the amount of such
State contributions.
``(c) Allotments to Eligible States.--The amount made
available under section 658B(b) for a fiscal year shall be
allotted among the eligible States in the same manner as
amounts are allotted under section 658O(b).
``(d) Use of Funds.--An eligible State that receives a grant
under this section shall use the funds received to
significantly increase the payment rate for the provision of
child care assistance in accordance with this subchapter up to
the 150th percentile of the market rate survey described in
subsection (b)(1)(A).
``(e) Evaluations and Reports.--
``(1) State evaluations.--Each eligible State shall
submit to the Secretary, at such time and in such form
and manner as the Secretary may require, information
regarding the State's efforts to increase payment rates
and the impact increased rates are having on the
quality of, and accessibility to, child care in the
State.
``(2) Reports to congress.--The Secretary shall
submit biennial reports to Congress on the information
described in paragraph (1). Such reports shall include
data from the applications submitted under subsection
(b)(2) as a baseline for determining the progress of
each eligible State in maintaining increased payment
rates.
``(f) Payment Rate.--In this section, the term `payment rate'
means the rate of reimbursement to providers for subsidized
child care.''.
(6) Administration, enforcement, and evaluation.--
Section 658I of the Child Care and Development Block
Grant Act of 1990 (42 U.S.C. 9858g) is amended--
(A) in the heading by striking ``AND
ENFORCEMENT'' and inserting ``, ENFORCEMENT,
AND EVALUATION'';
(B) in subsection (a)(3) by inserting before
the period at the end ``and including the
establishment of a national training and
technical assistance center specializing in
infant and toddler care and their families'';
and
(C) by adding at the end the following:
``(c) Federal Administration and Evaluation Activities.--The
Secretary shall--
``(1) establish a national data system through
grants, contracts or cooperative agreements to develop
statistics on the supply of, demand for, and quality of
child care, early education, and non-school-hours
programs, including use of data collected through child
care resource and referral organizations at the
national, State, and local levels; and
``(2) prepare and submit to Congress an annual report
on the supply of, demand for, and quality of child
care, early education, and non-school-hours programs,
using data collected through State and local child care
resource and referral organizations and other
sources.''.
(7) Reports.--Section 658K(a) of the Child Care and
Development Block Grant Act of 1990 (42 U.S.C.
9858i(a)) is amended--
(A) in paragraph (1)(B)--
(i) in clause (ix) by striking
``and'' at the end;
(ii) in clause (x) by adding ``and''
at the end; and
(iii) by inserting after clause (x)
the following:
``(xi) whether the child care
provider is accredited by a national or
State accrediting body;''; and
(B) in paragraph (2)--
(i) in the matter preceding
subparagraph (A) by striking
``aggregate data concerning'';
(ii) in subparagraph (D) by striking
``and'' at the end;
(iii) in subparagraph (E) by adding
``and'' at the end; and
(iv) by indenting the left margin of
subparagraphs (A) through (E) 2 ems to
the right and redesignating such
subparagraphs as clauses (i) through
(v), respectively;
(v) by inserting after clause (v), as
so redesignated, the following:
``(vi) findings from market rate
surveys, disaggregated by the types of
services provided and by the sub-State
localities, as appropriate;''; and
(vi) by inserting before clause (i),
as so redesignated, the following:
``(A) information on how all of the funds
reserved under section 658G were allocated and
spent, and information on the effect of those
expenditures, to the maximum extent
practicable; and
``(B) aggregate date concerning--''.
(8) Definitions.--Section 658P(4)(C) of the Child
Care and Development Block Grant Act of 1990 (42 U.S.C.
9858n(4)(C)) is amended--
(A) in clause (i) by striking ``or'' at the
end;
(B) in clause (ii) by striking the period and
inserting ``; or''; and
(C) by adding at the end the following:
``(iii) is a foster child.''.
(9) Conforming amendments.--The Child Care and
Development Block Grant Act of 1990 (42 U.S.C. 9858 et
seq.) is amended--
(A) in section 658E(c)(3)--
(i) in subparagraph (B) by striking
``through (5) of section 658A(b)'' and
inserting ``through (6) of section
658A(c)''; and
(ii) in subparagraph (D) by striking
``1997 through 2002'' and inserting
``2003 through 2007'';
(B) in section 658K(a)(2) by striking
``1997'' and inserting ``2003''; and
(C) in section 658L--
(i) by striking ``July 31, 1998'' and
inserting ``October 1, 2004'';
(ii) by striking ``Economic and
Educational Opportunities'' and
inserting ``Education and the
Workforce''; and
(iii) by striking ``Labor and Human
Resources'' and inserting ``Health,
Education, Labor, and Pensions''.
(c) Applicability of State or Local Health and Safety
Standards to Other TANF Child Care Spending.--Section 402(a)
(42 U.S.C. 602(a)) is amended by adding at the end the
following:
``(8) Certification of procedures to ensure that
child care providers comply with applicable state or
local health and safety standards.--A certification by
the chief executive officer of the State that
procedures are in effect to ensure that any child care
provider in the State that provides services for which
assistance is provided under the State program funded
under this part complies with all applicable State or
local health and safety requirements as described in
section 658E(c)(2)(F) of the Child Care and Development
Block Grant Act of 1990.''.
(d) Availability of Child Care for Parents Required to
Work.--Section 407(e)(2) (42 U.S.C. 607(e)(2)) is amended by
striking ``6'' and inserting ``13''.
SEC. 303. COMPETITIVE GRANTS TO IMPROVE ACCESS TO VARIOUS BENEFIT
PROGRAMS.
(a) Purposes.--The purposes of this section are to--
(1) inform low-income families with children about
programs available to families leaving welfare and
other programs to support low-income families with
children;
(2) provide incentives to States and counties to
improve and coordinate application and renewal
procedures for low-income family with children support
programs; and
(3) track the extent to which low-income families
with children receive the benefits and services for
which they are eligible.
(b) Definitions.--In this section:
(1) Locality.--The term locality means a municipality
that does not administer a temporary assistance for
needy families program funded under part A of title IV
of the Social Security Act (42 U.S.C. 601 et seq.) (in
this section referred to as ``TANF'').
(2) Low-income family with children support
program.--The term ``low-income family with children
support program'' means a program designed to provide
low-income families with assistance or benefits to
enable the family to become self-sufficient and
includes--
(A) TANF;
(B) the food stamp program established under
the Food Stamp Act of 1977 (7 U.S.C. 2011 et
seq.) (in this section referred to as ``food
stamps'');
(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.); and
(K) any other Federal or State funded program
designed to provide family and work support to
low-income families with children.
(3) Nonprofit.--The term ``nonprofit'', as applied to
a school, agency, organization, or institution means a
school, 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.
(4) Secretary.--The term ``Secretary'' means the
Secretary of Health and Human Services.
(5) State.--The term ``State'' means each of the
several States of the United States, the District of
Columbia, the Commonwealth of Puerto Rico, American
Samoa, Guam, and the United States Virgin Islands.
(c) Authorization of Grants.--
(1) States and counties.--
(A) In general.--The Secretary is authorized
to award grants to States and counties to pay
the Federal share of the costs involved in
improving the administration of low-income
family with children support programs,
including simplifying application,
recertification, reporting, and verification
rules, and promoting participation in such
programs.
(B) Federal share.--The Federal share shall
be 80 percent.
(2) Nonprofits and localities.--The Secretary is
authorized to award grants to nonprofits and localities
to promote participation in low-income family with
children support programs, and distribute information
about and develop service centers for low-income family
with children support programs.
(d) Grant Approval Criteria.--
(1) In general.--The Secretary, in consultation with
the Secretary of Agriculture, shall establish criteria
for approval of an application for a grant under this
section that include consideration of--
(A) the extent to which the proposal, if
funded, is likely to result in improved service
and higher participation rates in low-income
children's support programs;
(B) an applicant's ability to reach hard-to-
serve populations;
(C) the level of innovation in the
applicant's grant proposal; and
(D) any partnerships between the public and
private sector in the applicant's grant
proposal.
(2) Separate criteria.--Separate criteria shall be
established for the grants authorized under paragraphs
(1) and (2) of subsection (c).
(e) Uses of Funds.--
(1) States and counties.--
(A) Improvements in programs.--Grants awarded
to States and counties under subsection (c)(1)
shall be used to--
(i) simplify low-income family with
children support program application,
recertification, reporting, and
verification rules;
(ii) create uniformity in eligibility
criteria for low-income family with
children support programs;
(iii) develop options for families to
apply for low-income family with
children support programs through the
telephone, mail, facsimile, Internet,
or electronic mail, and submit any
recertifications or reports required
for such families through these
options;
(iv) co-locate eligibility workers
for various low-income family with
children support programs at
strategically located sites;
(v) develop or enhance one-stop
service centers for low-income family
with children support programs,
including establishing evening and
weekend hours at these centers; and
(vi) improve training of staff in
low-income families with children
support programs to enhance their
ability to enroll eligible applicants
in low-income family with children
support programs, provide case
management, and refer eligible
applicants to other appropriate
programs.
(B) Customer surveys.--
(i) In general.--A grant awarded to a
State or county under subsection (c)(1)
shall be used to carry out a customer
survey.
(ii) Model surveys.--The customer
survey under clause (i) of this
subparagraph shall be modeled after a
form developed by the Secretary under
subsection (g).
(iii) Reports to secretary.--Not
later than 1 year after a State or
county is awarded a grant under
subsection (c)(1), and annually
thereafter, the State or county shall
submit a report to the Secretary
detailing the results of the customer
survey carried out under clause (i) of
this subparagraph.
(iv) Reports to public.--A State or
county receiving a grant under
subsection (c)(1) and the Secretary
shall make the report required under
clause (iii) of this subparagraph
available to the public.
(v) Public comment.--A State or
county receiving a grant under
subsection (c)(1) shall accept public
comments and hold public hearings on
the report made available under clause
(iv) of this subparagraph.
(C) Tracking systems.--
(i) In general.--A grant awarded to a
State or county under subsection (c)(1)
shall be used to implement a tracking
system to determine the level of
participation in low-income family with
children support programs of the
eligible population.
(ii) Reports.--Not later than 1 year
after a State or county is awarded a
grant under subsection (c)(1), and
annually thereafter, the State or
county shall submit a report to the
Secretary detailing the effectiveness
of the tracking system implemented
under clause (i) of this subparagraph.
(D) In-person interviews.--A State or county
awarded a grant under subsection (c)(1) may
expend funds made available under the grant to
provide for reporting and recertification
procedures through the telephone, mail,
facsimile, Internet, or electronic mail.
(E) Jurisdiction-wide implementation.--
(i) In general.--A grant awarded to a
State or county under subsection (c)(1)
shall be used for activities throughout
the jurisdiction.
(ii) Exception.--A State or county
awarded a grant under subsection (c)(1)
may use grant funds to develop one-stop
service centers and telephone, mail,
facsimile, Internet, or electronic mail
application and renewal procedures for
low-income family with children support
programs without regard to the
requirements of clause (i) of this
subparagraph.
(F) Supplement not supplant.--Funds provided
to a State or county under a grant awarded
under subsection (c)(1) shall be used to
supplement and not supplant other State or
county public funds expended to provide support
services for low-income families.
(2) Nonprofits and localities.--A grant awarded to a
nonprofit or locality under subsection (c)(2) shall be
used to--
(A) develop one-stop service centers for low-
income family with children support programs in
cooperation with States and counties; or
(B) provide information about and referrals
to low-income family with children support
programs through the dissemination of materials
at strategic locations, including schools,
clinics, and shopping locations.
(f) Application.--
(1) In general.--Each applicant desiring a grant
under paragraph (1) or (2) of subsection (c) shall
submit an application to the Secretary at such time, in
such manner, and accompanied by such information as the
Secretary may reasonably require.
(2) States and counties.--
(A) Non-federal share.--Each State or county
applicant shall provide assurances that the
applicant will pay the non-Federal share of the
activities for which a grant is sought.
(B) Partnerships.--Each State or county
applicant shall submit a memorandum of
understanding demonstrating that the applicant
has entered into a partnership to coordinate
its efforts under the grant with the efforts of
other State and county agencies that have
responsibility for providing low-income
families with assistance or benefits.
(g) Duties of the Secretary.--
(1) Survey form.--The Secretary, in cooperation with
other relevant agencies, shall develop a customer
survey form to determine whether low-income families--
(A) encounter any impediments in applying for
or renewing their participation in low-income
family with children support programs; and
(B) are unaware of low-income family with
children support programs for which they are
eligible.
(2) Reports.--
(A) Annual reports.--Not later than 1 year
after the date of enactment of this Act, and
annually thereafter, the Secretary shall submit
a report to Congress describing the uses of
grant funds awarded under this section.
(B) Results of tracking systems and
surveys.--The Secretary shall submit a report
to Congress detailing the results of the
tracking systems implemented and customer
surveys carried out by States and counties
under subsection (e) as the information becomes
available.
(h) Miscellaneous.--
(1) Matching funds.--Matching funds required from a
State or county awarded a grant under subsection (c)(1)
of this section may--
(A) include in-kind services and expenditures
by municipalities and private entities; and
(B) be considered a qualified State
expenditure for purposes of determining whether
the State has satisfied the maintenance of
effort requirements of the temporary assistance
for needy families program under section
409(a)(7) of the Social Security Act (42 U.S.C.
609(a)(7)).
(2) Limitation on expenditures.--Subject to paragraph
(3) of this subsection, not more than 20 percent of a
grant awarded under subsection (c) shall be expended on
customer surveys or tracking systems.
(3) Reversion of funds.--Any funds not expended by a
grantee within 2 years after awarded a grant 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 2-year
time period to expend funds.
(4) Nonapportionment.--Notwithstanding any other
provision of law, a State, county, locality, or
nonprofit awarded a grant under subsection (c) is not
required to apportion the costs of providing
information about low-income family with children
support programs among all low-income family with
children support programs.
(5) Administrative costs of the secretary.--Not more
than 5 percent of the funds appropriated to carry out
this section shall be expended on administrative costs
of the Secretary.
(i) Authorization of Appropriations.--There is authorized to
be appropriated to carry out this section $500,000,000 for the
period of fiscal years 2003 through 2007.
SEC. 304. ASSESSMENTS FOR TANF RECIPIENTS.
Section 408(b) (42 U.S.C. 608(b)) is amended--
(1) by striking paragraph (1) and inserting the
following:
``(1) Assessment.--The State agency responsible for
administering the State program funded under this part
shall, for each recipient of assistance under the
program who is a head of household, make an initial
assessment of the skills, prior work experience, and
circumstances related to the employability of the
recipient, including physical or mental impairments,
proficiency in English, child care needs, and whether
the recipient is a victim of domestic violence.'';
(2) in paragraph (2)(A), by striking ``may develop''
and inserting ``shall develop''; and
(3) by striking paragraph (4).
SEC. 305. APPLICABILITY OF WORKPLACE LAWS.
Section 408 (42 U.S.C. 608) is amended by adding at the end
the following:
``(h) No individual engaged in any activity funded in whole
or in part by the TANF program shall be subjected to
discrimination based on race, color, religion, sex, national
origin, age, or disability, nor shall such an individual be
denied the benefits or protections of any Federal, State or
local employment, civil rights, or health and safety law
because of such individual's status as a participant in the
TANF program.''.
SEC. 306. WORK PARTICIPATION REQUIREMENTS.
Section 407(a)(1) (42 U.S.C. 607(a)), as amended by section
503 of this Act, is amended to read as follows:
``(1) In general.--A State to which a grant is made
under section 403 for a fiscal year shall achieve a
minimum participation rate equal to not less than--
``(A) 50 percent for fiscal year 2003;
``(B) 55 percent for fiscal year 2004;
``(C) 60 percent for fiscal year 2005;
``(D) 65 percent for fiscal year 2006; and
``(E) 70 percent for fiscal year 2007 and
each succeeding fiscal year.''.
SEC. 307. HOURS OF WORK-RELATED ACTIVITIES.
Section 407(c)(1)(A) (42 U.S.C. 607(c)(1)(A)) is amended by
striking ``20'' and inserting ``24''.
SEC. 308. STATE OPTION TO REQUIRE RECEIPIENTS TO ENGAGE IN WORK FOR 40
HOURS PER WEEK.
Section 407(c)(1)(A) (42 U.S.C. 607(c)(1)(A)) is amended by
adding at the end the following flush sentence:
``At the option of a State, the State may
require, a recipient not referred to in
paragraph (2)(B) to engage in work for an
average of 40 hours per week in each month in a
particular fiscal year.''.
SEC. 309. REVISION 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''.
(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); 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) Elimination of Sunset for TMA.--
(1) Subsection (g) of section 1925 (42 U.S.C. 1396r-
6), as redesignated under subsection (a)(2), is
repealed.
(2) Section 1902(e)(1) of such Act (42 U.S.C.
1396a(e)(1)) is amended by striking ``(A)
Nothwithstanding'' and all that follows through
``During such period, for'' in subparagraph (B) and
inserting ``For''.
(d) CMS Report on Enrollment and Participation Rates Under
TMA.--Section 1925, as amended by subsections (a)(2) and (c),
is amended by adding at the end the following new subsection:
``(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), 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 is further amended by
adding at the end the following new subsection:
``(h) Provisions Optional for States That Extend Coverage to
Children and Parents Through 185 Percent of Poverty.--A State
may (but is not required to) meet the requirements of
subsections (a) and (b) if it provides for medical assistance
under this title (whether under section 1931, through a waiver
under section 1115, or otherwise) 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.--Such section 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 such section is amended by adding after
and below subparagraph (B), the following:
``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 one-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.''.
(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) Except as provided in this
subsection, the amendments made by this section shall apply to
calendar quarters beginning on or after October 1, 2001,
without regard to whether or not final regulations to carry out
such amendments have been promulgated by such date.
(2) The amendment made by subsection (g) shall take effect 6
months after the date of the enactment of this Act.
(3) 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
the enactment of this Act. For purposes of the previous
sentence, in the case of a State that has a 2-year legislative
session, each year of such session shall be deemed to be a
separate regular session of the State legislature.
SEC. 310. ENSURING TANF FUNDS ARE NOT USED TO DISPLACE PUBLIC
EMPLOYEES.
(a) Welfare-to-Work Worker Protections.--Section 403(a)(5)(I)
(42 U.S.C. 603(a)(5)(I)) is amended--
(1) by striking clauses (i) and (iv);
(2) by redesignating clauses (v) and (vi) as clauses
(iv) and (v), respectively; and
(3) by inserting before clause (ii) the following:
``(i) Nondisplacement.--A State shall
establish and maintain such procedures
as are necessary to do the following
with respect to activities funded in
whole or in part under this part:
``(I) Prohibit the placement
of an individual in a work
activity specified in section
407(d) from resulting in the
displacement of 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, or
performing work when any other
individual is on layoff from
the same or any substantially
equivalent job).
``(II) Prohibit the placement
of an individual in a work
activity specified in section
407(d) which would impair any
contract for services, be
inconsistent with any
employment-related State or
local law or regulation, or
collective bargaining
agreement, or infringe on the
recall rights or promotional
opportunities of any worker.
``(III) Maintain an impartial
grievance procedure to resolve
any complaints alleging
violations of subclause (I) or
(II) within 60 days after
receipt of the complaint, and
if a decision is adverse to the
party who filed such a
grievance or no decision has
been reached, provided for the
completion of an arbitration
procedure within 75 days after
receipt of the complaint or the
adverse decision or conclusion
of the 60-day period, whichever
is earlier. The procedures
shall include a right to a
hearing. The procedures shall
include remedies for violations
of the requirement that shall
include termination or
suspension of payments,
prohibition of the participant,
reinstatemt of an employee, and
other appropriate relief. The
procedures shall specifiy that
if a direct work activity
engaged in by a recipient of
assistance under the State
program funded under this part
involves a placement in a State
agency or local government
agency pursuant to this section
and the agency experiences a
net reduction in its overall
workforce in a given year,
there is a rebuttable
presumption that the placement
has resulted in displacement of
the employees of the agency in
violation of this
subparagraph.''.
(b) State Plan Requirement.--Section 402(a) (42 U.S.C.
602(a)) is amended by adding at the end the following:
``(5) A plan that outlines the resources and
procedures that will be used to ensure that the State
will establish and maintain the procedures described in
section 403(a)(5)(I)(i).''.
TITLE IV--HELPING WELFARE LEAVERS CLIMB THE EMPLOYMENT LADDER
SEC. 401. STATE PLAN REQUIREMENT ON EMPLOYMENT ADVANCEMENT.
(a) In General.--Section 402(a)(1)(A) (42 U.S.C.
602(a)(1)(A)) is amended by adding at the end the following:
``(vii) Establish goals and take
action to improve initial earnings, job
advancement, and employment retention
for individuals in and individuals
leaving the program.''.
(b) Inclusion in Annual Reports of Progress in Achieving
Employment Advancement Goals.--Section 411(b) (42 U.S.C.
611(b)) is amended--
(1) by striking ``and'' at the end of paragraph (3);
(2) by striking the period at the end of paragraph
(4) and inserting ``; and'' ; and
(3) by adding at the end the following:
``(5) in each report submitted after fiscal year
2003, the progress made by the State in achieving the
goals referred to in section 402(a)(1)(A)(vii) in the
most recent State plan submitted pursuant to section
402(a).''.
SEC. 402. EMPLOYMENT ADVANCEMENT FUND.
Section 403(a) (42 U.S.C. 603(a)) is further amended by
adding at the end the following:
``(8) Employment advancement fund.--
``(A) In general.--The Secretary shall
provide grants to States and localities for
research, evaluation, technical assistance, and
demonstration projects that focus on--
``(i) improving wages for low-income
workers, regardless of whether such
workers are recipients of assistance
under a State program funded under this
part, through training and other
services; and
``(ii) enhancing employment prospects
for recipients of such assistance with
barriers to employment, such as a
physical or mental impairment, a
substance abuse problem, or limited
proficiency in English.
``(B) Administration.--
``(i) Allocation of funds.--The
Secretary shall allocate at least 40
percent of the funds made available
pursuant to this paragraph for projects
that focus on the matters described in
subparagraph (A)(i), and at least 40
percent of the funds for projects that
focus on the matters described in
subparagraph (A)(ii).
``(ii) Diversity of projects.--The
Secretary shall attempt to provide
funds under this paragraph for diverse
projects from geographically different
areas.
``(C) Aid under this paragraph not
`assistance'.--A benefit or service provided
with funds made available under this paragraph
shall not, for any purpose, be considered
assistance under a State program funded under
this part.
``(D) Appropriation.--Out of any money in the
Treasury of the United States not otherwise
appropriated, there are appropriated for each
of fiscal years 2003 through 2007 $150,000,000
for grants under this paragraph.''.
SEC. 403. ELIMINATION OF LIMIT ON NUMBER OF TANF RECIPIENTS ENROLLED IN
VOCATIONAL EDUCATION OR HIGH SCHOOL WHO MAY BE
COUNTED TOWARDS THE WORK PARTICIPATION REQUIREMENT.
Section 407(c)(2) (42 U.S.C. 607(c)(2)) is amended by
striking subparagraph (D).
SEC. 404. COUNTING OF UP TO 2 YEARS OF VOCATIONAL OR EDUCATIONAL
TRAINING (INCLUDING POSTSECONDARY EDUCATION), WORK-
STUDY, AND RELATED INTERNSHIPS AS WORK ACTIVITIES.
Section 407(d)(8) (42 U.S.C. 607(d)(8)) is amended to read as
follows:
``(8) not more than 24 months of participation by an
individual in--
``(A) vocational or educational training
(including postsecondary education), at an
eligible educational institution (as defined in
section 404(h)(5)(A)) leading to attainment of
a credential from the institution related to
employment or a job skill;
``(B) a State or Federal work-study program
under part C of title IV of the Higher
Education Act of 1965 or an internship related
to vocational or postsecondary education,
supervised by an eligible educational
institution (as defined in section
404(h)(5)(A)); or
``(C) a course of study leading to adult
literacy, in which English is taught as a
second language, or leading to a certificate of
high school equivalency, if the State considers
the activities important to improving the
ability of the individual to find and maintain
employment.''.
SEC. 405. LIMITED COUNTING OF CERTAIN ACTIVITIES LEADING TO EMPLOYMENT
AS WORK ACTIVITY.
(a) In General.--Section 407(d) (42 U.S.C. 607(d)) is
amended--
(1) by striking ``and'' at the end of paragraph (11);
(2) by striking the period at the end of paragraph
(12) and inserting ``; and''; and
(3) by adding at the end the following:
``(13) Up to 6 months of participation (as determined
by the State) in services designed to improve future
employment opportunities, including substance abuse
treatment services, services to address sexual or
domestic violence, and physical rehabilitation and
mental health services.''.
(b) Conforming Amendment.--Section 407(c)(1) (42 U.S.C.
607(c)(1)) is amended by striking ``and (12)'' each place it
appears and inserting ``(12), and (13)''.
SEC. 406. 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--
(1) in the subsection heading, by striking
``Assistance'' and inserting ``benefits or services'';
and
(2) after the heading, by striking ``assistance'' and
inserting ``any benefit or service that may be
provided''.
SEC. 407. DEFINITION OF ASSISTANCE.
(a) In General.--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 payment, by cash, voucher, or other
means, to or for an individual or family for
the purpose of meeting a subsistence need of
the individual or family (including food,
clothing, shelter, and related items, but not
including costs of transportation or child
care).
``(B) Exception.--The term `assistance' does
not include a payment described in subparagraph
(A) to or for an individual or family on a
short-term, nonrecurring basis (as defined by
the State).''.
(b) Conforming Amendments.--
(1) Section 404(a)(1) (42 U.S.C. 604(a)(1)) is
amended by striking ``assistance'' and inserting
``aid''.
(2) Section 404(f) (42 U.S.C. 604(f)) is amended by
striking ``assistance'' and inserting ``benefits or
services''.
(3) Section 408(a)(5)(B)(i) (42 U.S.C.
608(a)(5)(B)(i)) is amended in the heading by striking
``assistance'' and inserting ``aid''.
TITLE V--PROMOTING FAMILY FORMATION AND RESPONSIBLE PARENTING
SEC. 501. FAMILY FORMATION FUND.
Section 403(a)(2) (42 U.S.C. 603(a)(2)) is amended to read as
follows:
``(2) Family formation fund.--
``(A) In general.--The Secretary shall
provide grants to States and localities for
research, technical assistance, and
demonstration projects to promote and fund best
practices in the following areas:
``(i) Promoting the formation of 2-
parent families.
``(ii) Reducing teenage pregnancies.
``(iii) Increasing the ability of
noncustodial parents to financially
support and be involved with their
children.
``(B) Allocation of funds.--In making grants
under this paragraph, the Secretary shall
ensure that not less than 30 percent of the
funds made available pursuant to this paragraph
for a fiscal year are used in each of the areas
described in subparagraph (A).
``(C) Consideration of domestic violence
impact.--In making grants under this paragraph,
the Secretary shall consider the potential
impact of a project on the incidence of
domestic violence.
``(D) Appropriation.--Out of any money in the
Treasury of the United States not otherwise
appropriated, there are appropriated for each
of fiscal years 2003 through 2007 $100,000,000
for grants under this paragraph.''.
SEC. 502. 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 providing assistance to a family under the
State program funded under this part, that a member of
the family assign to the State any rights the family
member may have (on behalf of the family member or of
any other person for whom the family member has applied
for or is receiving such assistance) to support from
any other person, not exceeding the total amount of
assistance paid to the family under the program, 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 (d) and (e), 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.--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 (4), 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 share of the amount payable to a family for a
month 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 for the month pursuant to former
section 457(a)(2) (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) and (2), 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 and disregards the payment for purposes
of paying benefits under the State program
funded under part A.
``(B) Recipients of tanf for less than 5
years.--Notwithstanding paragraphs (1) and (2),
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 that has
received the assistance for not more than 5
years after the date of the enactment of this
paragraph, to the extent that the State pays
the amount to the family.''.
(B) Approval of estimation procedures.--Not
later than October 1, 2002, 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) is amended--
(1) by striking ``and'' at the end of paragraph (32);
(2) by striking the period at the end of paragraph
(33) and inserting ``; and''; and
(3) by inserting after paragraph (33) the following:
``(34) 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 Certain Support
Assignments.--Section 457(b) (42 U.S.C. 657(b)) is amended by
striking ``shall'' and inserting ``may''.
(e) Conforming Amendments.--
(1) Section 409(a)(7)(B)(i)(I)(aa) (42 U.S.C.
609(a)(7)(B)(i)(I)(aa)) is amended by striking
``457(a)(1)(B)'' and inserting ``457(a)(1)''.
(2) 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.''.
(3) Section 409(a)(7)(B)(i) (42 U.S.C.
609(a)(7)(B)(i)) is amended 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.''.
(f) Effective Date.--
(1) In general.--Except as provided in paragraph (2)
of this subsection and section 901(b) of this Act, the
amendments made by this section shall take effect on
October 1, 2006, 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.
(2) State option to accelerate effective date.--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 the enactment of this
Act and before the effective date provided in paragraph
(1).
SEC. 503. ELIMINATION OF SEPARATE WORK PARTICIPATION RATE FOR 2-PARENT
FAMILIES.
Section 407 (42 U.S.C. 607) is amended--
(1) in subsection (a), by striking paragraph (2); and
(2) in subsection (b)--
(A) by striking paragraphs (2) and (3);
(B) in paragraph (4), by striking
``paragraphs (1)(B) and (2)(B)'' and inserting
``paragraph (1)(B)'';
(C) in paragraph (5), by striking ``rates''
and inserting ``rate''; and
(D) by redesignating paragraphs (4) and (5)
as paragraphs (2) and (3), respectively.
SEC. 504. BAN ON IMPOSITION OF STRICTER ELIGIBILITY CRITERIA FOR 2-
PARENT FAMILIES; STATE OPT-OUT.
(a) Prohibition.--Section 408(a) (42 U.S.C. 608(a)) is
further amended by adding at the end the following:
``(13) Ban on imposition of stricter eligibility
criteria for 2-parent families.--
``(A) In general.--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) State opt-out.--Subparagraph (A) shall
not apply to a State if the State legislature,
by law, has elected to make subparagraph (A)
inapplicable to the State.''.
(b) Penalty.--Section 409(a) (42 U.S.C. 609(a)) is further
amended by adding at the end the following:
``(16) 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)(13) 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.''.
SEC. 505. EXTENSION OF ABSTINENCE EDUCATION FUNDING UNDER MATERNAL AND
CHILD HEALTH PROGRAM.
(a) In General.--Section 510(d) (42 U.S.C. 710(d)) is amended
by striking ``2002'' and inserting ``2007''.
(b) Purpose of Allotments.--For each of the fiscal years 2003
through 2007, section 510(b)(1) of the Social Security Act is
deemed to read as follows: ``(1) The purpose of an allotment
under subsection (a) to a State is to enable the State to
provide abstinence education, and at the option of the State--
``(A) programs that the State defines as an
appropriate approach to abstinence education that
educates those who are currently sexually active or at
risk of sexual activity about methods to reduce
unintended pregnancy or other health risks; and
``(B) where appropriate, mentoring, counseling, and
adult supervision to promote abstinence from sexual
activity, with a focus on those groups which are most
likely to bear children out-of-wedlock.''.
(c) Medically and Scientifically Accurate Information.--For
each of the fiscal years 2003 through 2007, there is deemed to
appear in the matter preceding subparagraph (A) of section
510(b)(2) of such Act the phrase ``a medically and
scientifically accurate educational'' in lieu of the phrase
``an educational'', and there is deemed to appear after and
below subparagraph (H) of such section the following:
``For purposes of this section, the term `medically accurate',
with respect to information, means information that is
supported by research, recognized as accurate and objective by
leading medical, psychological, psychiatric, and public health
organizations and agencies, and where relevant, published in
peer review journals.''.
(d) Effective Models for Programs.--For each of the fiscal
years 2003 through 2007, section 510 of such Act is deemed to
have at the end the following subsection:
``(e)(1) None of the funds appropriated in this section shall
be expended for a program unless the program is based on a
model that has been demonstrated to be effective in reducing
unwanted pregnancy, or in reducing the transmission of a
sexually transmitted disease or the human immunodeficiency
virus.
``(2) The requirement of paragraph (1) shall not apply to
programs that have been approved and funded under this section
on or before April 19, 2002.''.
(e) Comparative Evaluation of Abstinence Education
Programs.--
(1) Study.--The Secretary of Health and Human
Services (referred to in this subsection as the
``Secretary'') shall, in consultation with an advisory
panel of researchers identified by the Board on
Children Youth and Families of the National Academy of
Sciences, conduct an experimental study directly or
through contract or interagency agreement which
assesses the relative efficacy of two approaches to
abstinence education for adolescents. The study design
should enable a comparison of the efficacy of an
abstinence program which precludes education about
contraception with a similar abstinence program which
includes education about contraception. Key outcomes
that should be measured in the study include rates of
sexual activity, pregnancy, birth, and sexually
transmitted diseases.
(2) Report.--Not later than 5 years after the date of
the enactment of this Act, the Secretary shall submit a
report to Congress the available findings regarding the
comparative analysis.
(3) Funding.--For the purpose of carrying out this
subsection, there are authorized to be appropriated
such sums as may be necessary for each of the fiscal
years 2003 through 2007.
TITLE VI--RESTORING FAIRNESS FOR IMMIGRANT FAMILIES
SEC. 601. TREATMENT OF ALIENS UNDER THE TANF PROGRAM.
(a) Exception to 5-Year Ban for Qualified Aliens.--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:
``(L) Benefits under the Temporary Assistance
for Needy Families program described in section
402(b)(3)(A).''.
(b) Benefits Not Subject to Reimbursement.--Section 423(d) of
the Personal Responsibility and Work Opportunity Reconciliation
Act of 1996 (8 U.S.C. 1138a note) is amended by adding at the
end the following:
``(12) Benefits 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(h) of the Social Security Act.''.
(c) Treatment of Aliens.--Section 408 (42 U.S.C. 608) is
amended by adding at the end the following:
``(h) Special Rules Relating to the Treatment of 213A
Aliens.--
``(1) In general.--In determining whether a 213A
alien is eligible for cash assistance under a State
program funded under this part, and in determining the
amount or types of such assistance to be provided to
the alien, the State shall apply the rules of
paragraphs (1), (2), (3), (5), and (6) of subsection
(f) of this section by substituting `213A' for `non-
213A' each place it appears, subject to section 421(e)
of the Personal Responsibility and Work Opportunity
Reconcilation Act of 1996, and subject to section
421(f) of such Act (which shall be applied by
substituting `section 408(h) of the Social Security
Act' for `subsection (a)').
``(2) 213A alien defined.--An alien is a 213A alien
for purposes of this subsection if the affidavit of
support or similar agreement with respect to the alien
that was executed by the sponsor of the alien's entry
into the United States was executed pursuant to section
213A of the Immigration and Nationality Act.''.
(d) Effective Date and Applicability.--
(1) Effective date.--The amendments made by this
section shall take effect October 1, 2002.
(2) Applicability.--The amendments made by this
section shall apply to benefits provided on or after
the effective date of this section.
SEC. 602. OPTIONAL COVERAGE OF LEGAL IMMIGRANTS UNDER THE MEDICAID
PROGRAM AND SCHIP.
(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 new paragraph:
``(4)(A) A State may elect (in a plan amendment under this
title) to provide medical assistance under this title,
notwithstanding sections 401(a), 402(b), 403, and 421 of the
Personal Responsibility and Work Opportunity Reconciliation Act
of 1996, for aliens who are lawfully residing in the United
States (including battered aliens described in section 431(c)
of such Act) and who are otherwise eligible for such
assistance, within either or both 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) 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.''.
(b) SCHIP.--Section 2107(e)(1) (42 U.S.C. 1397gg(e)(1)) as
amended by section 803 of the Medicare, Medicaid, and SCHIP
Benefits Improvement and Protection Act of 2000, as enacted
into law by section 1(a)(6) of Public Law 106-554, is amended
by redesignating subparagraphs (C) and (D) as subparagraph (D)
and (E), respectively, and by inserting after subparagraph (B)
the following new subparagraph:
``(C) Section 1903(v)(4) (relating to
optional coverage of categories of permanent
resident alien children), but only if the State
has elected to apply such section to the
category of children under title XIX.''.
(c) Effective Date.--The amendments made by this section take
effect on October 1, 2002, and apply to medical assistance and
child health assistance furnished on or after such date.
SEC. 603. ELIGIBILITY OF DISABLED CHILDREN WHO ARE QUALIFIED ALIENS FOR
SSI.
(a) In General.--Section 402(a)(2) of the Personal
Responsibility and Work Opportunity Reconciliation Act of 1996
(8 U.S.C. 1612(a)(2)) is amended by inserting after
subparagraph (K) the following new subparagraph:
``(L) SSI exception for disabled children.--
With respect to eligibility for benefits for
the specified Federal program described in
paragraph (3)(A), paragraph (1) shall not apply
to a child who is considered disabled for
purposes of the supplemental security income
program under title XVI of the Social Security
Act.''.
(b) Effective Date.--The amendment made by this section shall
take effect on October 1, 2002, and apply to benefits furnished
on or after such date.
TITLE VII--ENSURING STATE ACCOUNTABILITY
SEC. 701. INFLATION ADJUSTMENT OF MAINTENANCE-OF-EFFORT REQUIREMENT.
Section 409(a)(7) (42 U.S.C. 609(a)(7)) is amended--
(1) in subparagraph (A), by inserting ``inflation-
adjusted'' before ``historic State expenditures''; and
(2) in subparagraph (B), by adding at the end the
following:
``(vi) Inflation-adjusted historic
state expenditures.--The term
`inflation-adjusted historic State
expenditures' means, with respect to a
fiscal year, historic State
expenditures with respect to the fiscal
year, multiplied by the sum of 1.00
plus the inflation percentage (as
defined in section 403(a)(2)(F)) in
effect for the fiscal year.''.
SEC. 702. BAN ON USING FEDERAL TANF FUNDS TO REPLACE STATE AND LOCAL
SPENDING THAT DOES NOT MEET THE DEFINITION OF
QUALIFIED STATE EXPENDITURES.
(a) Prohibition.--Section 408(a) (42 U.S.C. 608(a)) is
further amended by adding at the end the following:
``(14) Ban on using federal tanf funds to replace
state or local spending that does not meet the
definition of qualified state expenditures.--A State to
which a grant is made under section 403 and a sub-State
entity that receives funds from such a grant shall not
expend any part of the grant funds to supplant State or
local spending for benefits or services which are not
qualified State expenditures (within the meaning of
section 409(a)(7)(B)(i)).''.
(b) Penalty.--Section 409(a) (42 U.S.C. 609(a)) is further
amended by adding at the end the following:
``(17) Penalty for using federal tanf funds to
replace state or local spending that does not meet the
definition of qualified state expenditures.--
``(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)(14) 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.''.
TITLE VIII--IMPROVING INFORMATION ABOUT TANF RECIPIENTS AND PROGRAMS
SEC. 801. EXTENSION OF FUNDING OF STUDIES AND DEMONSTRATIONS.
Section 413(h)(1) (42 U.S.C. 613(h)(1)) is amended by
striking ``2002'' and inserting ``2007''.
SEC. 802. LONGITUDINAL STUDIES OF EMPLOYMENT AND EARNINGS OF TANF
LEAVERS.
Section 413 (42 U.S.C. 613) is amended--
(1) in subsection (h)(1)--
(A) by striking ``and'' at the end of
subparagraph (C);
(B) by striking the period and inserting ``;
and''; and
(C) by adding at the end the following:
``(E) the cost of conducting the studies
described in subsection (k).''; and
(2) by adding at the end the following:
``(k) Longitudinal Studies of Employment and Earnings of TANF
Leavers.--
``(1) In general.--The Secretary, directly or through
grants, contracts, or interagency agreements shall
conduct a study in each eligible State of a
statistically relevant cohort of individuals who leave
the State program funded under this part during fiscal
year 2003 and individuals who leave the program during
fiscal year 2005, which uses State unemployment
insurance data to track the employment and earnings
status of the individuals during the 3-year period
beginning at the time the individuals leave the
program.
``(2) Reports.--The Secretary shall annually publish
the findings of the studies conducted pursuant to
paragraph (1) of this subsection, and shall annually
publish the earnings data used in making determinations
under section 407(b).''.
SEC. 803. INCLUSION OF DISABILITY STATUS IN INFORMATION STATES REPORT
ABOUT TANF FAMILIES.
Section 411(a)(1)(A) (42 U.S.C. 611(a)(1)(A)) is amended by
adding at the end the following:
``(xviii) Whether the head of the
family has a significant physical or
mental impairment.
SEC. 804. ANNUAL REPORT TO THE CONGRESS TO INCLUDE GREATER DETAIL ABOUT
STATE PROGRAMS FUNDED UNDER TANF.
Section 411(b)(3) (42 U.S.C. 611(b)(3)), as amended by
section 401(b)(1) of this Act, is amended to read as follows:
``(3) the characteristics of each State program
funded under this part, including, with respect to each
program funded with amounts provided under this part or
with amounts the expenditure of which is counted as a
qualified State expenditure for purposes of section
409(a)(7)--
``(A) the name of the program;
``(B) whether the program is authorized at a
sub-State level (such as at the county level);
``(C) the purpose of the program;
``(D) the main activities of the program;
``(E) the total amount received by the
program from amounts provided under this part;
``(F) the total of the amounts received by
the program that are amounts the expenditure of
which are counted as qualified State
expenditures for purposes of section 409(a)(7);
``(G) the total funding level of the program;
``(H) the total number of individuals served
by the program, and the number of such
individuals served specifically with funds
provided under this part or with amounts the
expenditure of which are counted as qualified
State expenditures for purposes of section
409(a)(7); and
``(I) the eligibility criteria for
participation in the program;''.
SEC. 805. ENHANCEMENT OF UNDERSTANDING OF THE REASONS INDIVIDUALS LEAVE
STATE TANF PROGRAMS.
(a) Development of Comprehensive List of Case Closure
Reasons.--The Secretary of Health and Human Services shall
develop, in consultation with States and policy experts, a
comprehensive list of reasons why individuals leave State
programs funded under this part. The list shall be aimed at
substantially reducing the number of case closures under the
programs for which a reason is not known.
(b) Inclusion in Quarterly State Reports.--Section
411(a)(1)(A)(xvi) (42 U.S.C. 611(a)(1)(A)(xvi)) is amended--
(1) by striking ``or'' at the end of subclause (IV);
(2) by striking the period at the end and inserting
``; or''; or
(3) by adding at the end the following:
``(VI) a reason specified in
the list developed under
section 805(a) of the Next Step
in Reforming Welfare Act.''.
SEC. 806. STANDARDIZED STATE PLANS.
Within 6 months after the date of the enactment of this Act,
the Secretary of Health and Human Services, after consulting
with the States, shall establish a standardized format which
States shall use to submit plans under section 402(a) of the
Social Security Act for fiscal year 2004 and thereafter.
SEC. 807. STUDY BY THE CENSUS BUREAU.
(a) In General.--Section 414(a) (42 U.S.C. 614(a)) is amended
to read as follows:
``(a) In General.--The Bureau of the Census shall implement a
new longitudinal survey of program dynamics, developed in
consultation with the Secretary and made available to
interested parties, to allow for the assessment of the outcomes
of continued welfare reform on the economic and child well-
being of low-income families with children, including those who
received assistance or services from a State program funded
under this part, and, to the extent possible, shall provide
State representative samples.''.
(b) Appropriation.--Section 414(b) (42 U.S.C. 614(b)) is
amended by striking ``1996,'' and all that follows through
``2002'' and inserting ``2003 through 2007''.
SEC. 808. ACCESS TO WELFARE; WELFARE OUTCOMES.
Section 411 (42 U.S.C. 611) is amended by adding at the end
the following:
``(c) Annual Reports on Welfare Access and Outcomes.--
``(1) State reports.--Not later than January 1 of
each fiscal year, each eligible State shall collect and
report to the Secretary, with respect to the preceding
fiscal year, the following information:
``(A) The number of applications for
assistance from the State program funded under
this part, the percentage that are approved
versus those that are disapproved, and the
reasons for disapproval, broken down by race.
``(B) A copy of all rules and policies
governing the State program funded under this
part that are not required by Federal law, and
a summary of the rules and policies, including
the amounts and types of assistance provided
and the types of sanctions imposed under the
program.
``(C) The types of occupations of, types of
job training received by, and types and levels
of educational attainment of recipients of
assistance from the State program funded under
this part, broken down by gender and race.
``(2) Use of sampling.--A State may comply with this
subsection by using a scientifically acceptable
sampling method approved by the Secretary.
``(3) Report to the congress.--Not later than June 1
of each fiscal year, the Secretary shall prepare and
submit to the Committee on Ways and Means of the House
of Representatives and the Committee on Finance of the
Senate, publish in the Federal Register, and make
available to the public a compilation of the reports
submitted pursuant to paragraph (1) for the preceding
fiscal year.''.
TITLE IX--EFFECTIVE DATE
SEC. 901. EFFECTIVE DATE.
(a) In General.--Except as provided in sections 208 and
502(f) and in subsection (b) of this section, the amendments
made by this Act shall take effect on October 1, 2002, 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 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 the enactment
of this Act. For purposes of the previous sentence, in the case
of a State that has a 2-year legislative session, each year of
such session shall be deemed to be a separate regular session
of the State legislature.